Emotional Intelligence in Financial Planning with James Woodfall & Sam Oakes

Unlock the secrets of emotional intelligence in financial planning with James Woodfall, our special guest and ex-financial planner turned EQ expert. Discover how emotional intelligence stacks up against traditional IQ in shaping successful careers in financial planning. Learn why EQ is a game-changer in recruitment, training, and its profound impact on the bottom line.

James explains why emotional intelligence is crucial for navigating high-stakes financial conversations. We delve into the science behind neuroplasticity and how mindfulness techniques can catalyse personal and professional growth. Witness the transformational power of empathy and self-awareness in enhancing job performance and client relationships.

Furthermore, we explore the future of financial planning where AI and emotional insights converge. Imagine AI-driven CRM systems revolutionising client management through tailored, anticipatory service. James provides a glimpse into building in-house EI experts and the exciting possibilities of AI-enhanced emotional intelligence assessments. This episode is a treasure trove of insights for anyone keen to elevate their emotional intelligence and thrive in the dynamic world of financial planning.

here's a couple of recommendations from James:

Vanguard paper mentions behavioral coaching, and that advisers need to recognise clients' emotions:

Emotions Revealed by Paul Ekman is a great read for those interested in emotions and behavior.

The Coaching Habit by Michael Bungay Stanier is recommended for asking better questions. We spoke about why giving advice or asking questions are not optimal first responses, this book contains some good content about why. It's primarily for leaders, but with a few tweaks the questions are great to use with clients. 

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Chapters

• 0:00 Exploring Emotional Intelligence in Finance
• 11:11 Understanding Emotional Intelligence in Finance
• 24:14 Enhancing Empathy Through Understanding Emotions
• 29:44 EQ vs IQ in Financial Planning
• 41:44 Measuring Emotional Intelligence in Recruitment
• 47:50 Training Emotional Intelligence in the Workplace
• 1:01:22 The Impact of Emotional Intelligence
• 1:06:45 Emotional Intelligence in Financial Planning
• 1:16:03 Implementing Emotional Intelligence in Financial Planning
• 1:25:09 CRM Integration and Financial Planning Connectivity

Transcript

Speaker 1: 0:00

Hello and welcome to the Financial Planner Life podcast. I'm Sam Oakes and today I've got James Woodfall on the podcast. He's an ex-financial planner. He ran his own business for over a decade. He's now working in emotional intelligence and today we dig deep around emotional intelligence. Put it up against IQ and exactly what is emotional intelligence, how this can impact the recruitment and the training of staff within a financial planning business and affect the bottom line. This is a fantastic episode future thinking, different thought process, outside of the box, about how you can improve your journey within your financial planning career, not just for you, but for your staff as well if you're a business owner. I hope you enjoy it, james. Thank you so much for joining me today on the Financial Planner Life podcast. How are you Good? Yeah, it's great to be invited on. Thanks. Are you feeling emotionally?

Speaker 2: 1:05

intelligent today. Yeah, um, prior to us talking, I I did my body scan. You know I did sort of 10 minutes of mindfulness, you know, thinking about am I in the right state for this conversation? So, yeah, I'm feeling top form, so whatever I used to do that a lot actually.

Speaker 1: 1:20

yeah, I used to do that a lot. I used to have my little um sound bowl actually I don't know where it is now, I think it down now I've moved my office into my house but I used to do a little sound bowl and I used to come in, sit at my podcast ready to do a podcast and get my sound bowl out and do that and then meditate for 10 minutes and I did find it actually put me into a really relaxed state of mind and allowed me to be ready to be open as well. It allowed me to be open and not in my head thinking should I say, what, should I do? It was more about okay, um, you can remain open and let the conversation flow. So I think the whole getting yourself into a good headspace, meditation and the body scan works really, really well. When it comes to the mindfulness something I've practiced quite a lot over the years, actually, um, do you, do you meditate?

Speaker 2: 2:07

uh, yeah, so the. I use an app, um called waking up. Okay, it's by a neuroscientist who studied, uh, meditation for I don't know, 20, 30 years. It's really, really good and um.

Speaker 2: 2:20

The thing I like about it is there's a, there's a daily meditation on there so you can do, you know, 10 minutes or you can. You can do a bit longer than that, and they just expand it with silence, which is good, um. But there's about when you, when you sign up for it, there's a 30 day um, it's basically like a 30 day course of how to meditate properly. So over that 30 days, you do it every single day and they teach you various different techniques about, um, about how to do it. So some of it is you sit with your sit with your eyes closed. Some of it's you sit with your eyes open. You know, look at sort of wide visual field, um, and that's quite, that's quite interesting.

Speaker 2: 2:55

The. The thing I really like about it is it's it's got like all these little sort of podcasts type um sort of bits of content in there. So people who talk about emotions, so they'll get, say some, you know some people who study emotions academically, they'll come along, they'll talk about emotions. Uh, you get people they can't um matt walker on um, you know why we sleep, so they have people talking about procrastination, productivity, um, it's a real, real good resource that you get, and I think the first 30 days I think it's probably free, but then you can sign up for, I think, a subscription or I think there's a lifetime membership. I think that's what I did. It's about £300 or £400. And it's just brilliant value and I think it's yeah, I highly recommend that one.

Speaker 1: 3:38

That's fantastic. What was the name again?

Speaker 2: 3:41

Waking Up.

Speaker 2: 3:46

Waking Up again, uh waking up, waking up, I'm gonna get that one. Yeah, it's really good. Um, yeah, I want to get. The thing I liked about it, with the style of meditation as well, is I throw my headspace in the car mat, um, and it's just a small thing. But with this one it's guided meditation, but there's no music in the background. So, you know, you get that sort of ethereal, you know. With some of the rest, like, ah ha ha ha, I find that really awkward.

Speaker 2: 4:08

The guy who does the guided meditations on this, he'll drop it and say, right, if you're trying too hard to meditate, just stop, just be aware that this is it, this is consciousness. Just sit in the space and just chill out. And then he'll be quiet for two minutes and I really like that, and the I also. I like that. He's a neuroscientist, um, so I like that. There's actually you've got this kind of highly, highly ancient tradition, um, but uh, they're also sort of combining it with. Well, actually there's now quite a lot of study going on into looking at how meditation and mindfulness affects the brain.

Speaker 2: 4:52

So, well, that's my gig, that's my brand, because I'm fascinated by that.

Speaker 1: 4:55

That's really cool and that's why you're here today. We're going to talk about that. I love Andrew Huberman and the Huberman Lab as well being a neuroscientist lab, as well being a neuroscientist, and it's where I first heard about neuroplasticity, the ability for us to actually change our brains and the way that we think with new neurological pathways. And when people say like a leopard never changes its spots, it's like we actually can change, and I think that's going to be topic of conversation today with you, isn't it? We're going to talk about that. Let's just kick things off first of all, to give some people on this podcast a bit of context, that you know what you're talking about and that you have experience of working within the financial planning profession, so just give us a little bit of an overview of your history up to today's date.

Speaker 2: 5:42

Yeah, sure. So I spent 15 years as a financial advisor, for so I was. I was 21, 22 I think, um, when I started, uh at barclays. So they used to have a financial advisor academy, um, which is barclays financial planning back in the day. So I did that for a couple of years and then there was there was think a day. They put everyone in office and said, right, you're all done, didn't go home. So that was quite interesting early start in the career.

Speaker 2: 6:14

And then I went and worked for HSBC as an employee advisor and did that for four years and then set up my own business under St James' Space partnership 10 years ago last month actually and I ran that business for nearly nine years and it was a great business. We had a good number of clients, good funds and arrangement. I had a good back office team, a power planner, support staff and two advisors in the business and it was all going well and we were. We were doing really, really good work and utilizing uh, you know cash flow modeling tools, you know doing financial planning. Um, like a few years, a few years before I exited, we effectively looked at doing sort of fee only financial planning that wasn't related to products. So we had a, had a service where we would take clients through and just build a, build a financial plan for them, write them a decent report and they could go away and implement themselves if they, if they wanted to um. So it's great and I think the I was.

Speaker 2: 7:18

I was really into actually looking at how do I become a better financial planner. So I went through kind of a process of doing a coaching diploma. So I did an executive coaching diploma about five years ago and then I got interested in um. So one of the things that happened when I did the coaching diploma was they. They talked about different levels of listening. So, like it's an active listening and this comes from co-active coaching. They were talking about sort of there's three levels of listening and the third level was, uh, like read the room. And I kind of came away from that thinking how do you read a room? Is that? There's no real instructions with it, and I I came across a master's program which was, I think, in communication, behavior and credibility analysis, run through partnership with a company called the emotion intelligence academy you want to do a lot of work with now and the manchester university so effectively.

Speaker 2: 8:14

I did that four years ago, so graduated two years ago and throughout that program it was a deep dive into looking at communication, behavior, analysis, motion intelligence, a bit of investigative interviewing, criminology but really I was trying to sort of uncover look, how can I become a better advisor, how can I understand and read clients' behavior so that I can communicate the work and work they could do with them and the value that brings in a far more compelling way way. So it was good, um, but then I think the um two years ago what happened was I I had some health issues, um, or, and I basically went to, uh, I went in for like a, a really decent mot, like a full body mri, you know good, so a set of bloods to check. I was in good shape and I went into that thinking actually I was going to come out. You know, clean bill of health, nothing wrong with you. Off you go. But I came out with this report that you know basically said you need to go and see a neurosurgeon. I was like, okay, well, that's interesting news. And I went and saw this guy and he said look, you've got two aneurysms in your brain and if we don't sort them out at some point in your life they could burst and kill you. So I was like, okay, sit back in the chair. It's like, what the hell do I do with that information?

Speaker 2: 9:38

Um, so the main decision was is that I had to had to exit business. My daughter was due to be born the the end of that year and it just made sense just to. I didn't want to risk, you know, going into major surgery and thinking, well, is the business going to be there when I come back? So I had to wind it down, you know, pass the clients over to some colleagues in the service, and that was that. So I effectively had last year off, um, you know, in and out hospital and was thinking about, well, what do I do next?

Speaker 2: 10:12

And while I was doing the master's program, um, in the second year you do a, a dissertation. So you're marked on a dissertation, effectively, and my dissertation was in, uh, looking at the relationship between emotion, intelligence and job performance in financial bars. And as I was going through that, looking at what the research literature says about that and doing my own research and study with a cohort financial planners, I found that there was a link between emotion, intelligence scores and sales performance and client retention and number of client referrals that advisors are getting. And I just thought, well, that's really really interesting, because one of the other things that the literature said about emotion intelligence is that it's a skill and ability that you can teach. So, um, just purely by deductive reasoning, I thought, well, if you can teach it, then you've got a platform for training people that should lead to improvements in job performance. So I thought that was really interesting. And last year I just thought, well, what am I going to do next if it's not going back into financial planning? And I just thought, well, that.

Speaker 1: 11:21

That's an interesting story. I'm going to go back to that day that you were told that you had two aneurysms, right, and you went in for that mot. I think a lot of us often think I really want to go for an mot um health check, but I'm there's also this part of you that thinks I don't want to find out if there's anything wrong with me. Now your experience of that and going through it and what would your advice be? Would it be go and have an mot for your health check, because you never know, or you know, going through the process yourself and having going through that scary situation right, it's bloody scary by the sounds of it what advice would you have for somebody who's thinking about going for a health check mot?

Speaker 2: 12:09

so it's interesting. I learned um a huge amount about aneurysms, um, because it's quite, it's quite interesting when you, when you go and see the surgeon, they effectively said, well, there's different types of surgery we can do, but you've got to make the decision, and I don't know whether it's just a symptom of the fact that we live in a world that's quite litigious. So you know, they they effectively, um, you know, want you to make the call about what you do. But it means that I had to do a huge amount of my own research, um, and one of the things that I found, especially with aneurysms, is that the NHS routinely don't scam for them, because something like five in a hundred will have them, and most are totally benign and so small that they'll never cause any issue or rupture risk or rock to risk.

Speaker 2: 13:01

But I think this is kind of the point you're getting to is that the anxiety that comes with knowing is something we can't cope with, and so that kind of is, if you're going for an MOT, you could find something which is totally benign but that might just get in your head and you just think, hang on, it's always in the back of your mind, um, but I would, I would say the reason I did it was because, um, I was, I got quite into this.

Speaker 2: 13:34

You know the idea of preventative health, um, and actually make it, and the decisions that you make today about things like diet, exercise, you know, mindfulness, cutting out alcohol, sleeping well, and you know they're all really, really important for longevity and I and I thought, well, actually you know full body scans and you know, getting a good set of diagnostics to kind of look at what's going on was was kind of included within, within that kind of reading and things I was interested in. So I wouldn't say don't do it. I would say do it, but be prepared that if there is, you know something that you just gotta you've got to be mindful about how you're gonna deal with that and it changed your life and it changed your direction of your life as well.

Speaker 1: 15:02

It's led you down the pathway of now doing something completely different. So sometimes the world and the universe presents some interesting learnings that send you off on a different pathway and now send you down, uh, the route of being an emotional intelligence expert. Now, I think everybody's heard the term emotional intelligence at some point, but I wonder how many people actually truly can describe what emotional intelligence actually is. So for the good of me, who does use it on a regular basis, and probably a lot of our listeners, can you just describe and explain what emotional intelligence actually is?

Speaker 2: 15:40

Yeah, it's a good point because I think there's lots of definitions out there. It's a concept that's been around for over 30 years now, so I think it started being developed in the 80s and there's still now no universal agreement within the academic community about what it is. But there was a recent definition by my colleague, cliff lansley, the emotion intelligence academy, um, from 2020, and he, if he went out and got agreement I think 75 plus agreement from you know, scientists who study emotions and emotion intelligence that this is a good definition. So he basically defined it as an ability, and that's important. It's an ability, so, rather than it being a trait like, say, a personality trait, which is you're either extroverted or you're introverted and that's how you are, it's an ability which means that with training, with education, with coaching, you can develop it. So it's an ability to perceive, and that basically means reading and understanding others. Reading and understanding others' behavior and how emotions affect their behavior, understanding that, which is hypothesizing and being able to interpret you know what's behind those behaviors and influencing so our own and others. So we don't just apply emotional intelligence to our interactions with others, we also apply it to ourselves. So part of that, looping back to mindfulness, what mindfulness really does for you is. It increases, I think, your perception of what's going on in your own body. So you recognize, I think, emotions in yourself through mindfulness practice and you get better at that. So understanding and influencing one another's emotions across a range of different contexts, because it's not just professional, it can be personal, and the kind of outcome here is that it guides our thinking and actions, um to help us, you know, and others, achieve their goals.

Speaker 2: 17:36

So you can break emotion intelligence down a bit further and just say well, it's made up of um four quadrants, effectively, so if you there's two kind of call up, sort of meta, you know. Meta, which is self and other, break self down into self-awareness, which is understanding emotions in yourself, and self-management, which is tools and strategies for how you manage emotions in yourself. So, for example, it could be um, you know that you, you know you learn how to um, you know, recognize when you're becoming, you know, fearful about something, and maybe you can introduce a strategy like cognitive appraisal, for example, you know, where you kind of appraise the situation and just think well, what is it that's causing me to be afraid, and is that a rational, logical response, or is it an emotional response. Actually, is it the right response for the situation? So that is kind of the self-management sort of element of some of these abilities. And it's like with anger. You know, trigger for anger is, I think, barrier in the way of a goal. So you use that kind of analogy of when someone cuts you up in traffic, you're on the horn, you're out the window swearing and really that reaction of you doing that is kind of that. You use that metaphor of the chimp. So you read that, that chimp paradox by Stephen Peters, but that's the chimp reacting, you know, before the human. And usually what happens is you calm down and you just think I probably shouldn't have done that.

Speaker 2: 19:13

So sometimes that self-management is just recognizing the emotion as it arises, maybe putting the brakes on it and just saying well, actually it's not appropriate for me to kind of let anger out the bag in this situation, but in others it might be. You know, in some contexts you know it is. You know, if you're in the street with your family, someone comes up, starts harassing you, clenching your fists and maybe telling them to back off, showing them that you're a threat to them or ready to be a threat to them. That's appropriate in the right situation. So you're utilizing emotions intelligently and really. That's that's, um, that's one element in terms of self. Other is then, once you can do it with yourself and you can recognize, understand and influence yourself you, then what then happens is your, your level of understanding and empathy for others goes through the roof.

Speaker 2: 20:07

Um, because then what you can do is you can start to identify emotional behaviors in other you know and in other people, and then you can start hypothesizing about what's behind that, and then you can apply influence you know to to guide people towards, towards the right outcomes. And this is really important, I think, in in financial planning contexts. Um, because ultimately, what do financial planners do day in, day out as part of part of the decisions that they have with clients? And it's deal with emotion and emotion. You can't separate emotion from the job role.

Speaker 2: 20:44

You know whether it's emotion in finance about the emotions that affect decisions around risk, um, but more often than not, it's actually the emotions that just come with dealing with life. You know dealing with a client who's grieving. You know dealing with a client who's dealing with stress and moving home. Dealing with you know the kind of you know big changes in life, you know. Selling a business, starting a business All of that, you know, involves, involves emotion, and advisors ability to perform is intrinsically linked to their ability to get clients to trust them. And the way that they do that is by being very, very by paying careful attention to clients emotions and empathizing and showing that they understand. And when they do that trust, trust grows um. And when they don't pick up on those cues, it's not good for relationships very interesting.

Speaker 1: 21:40

I went on a very I've gone on this journey in my life and I think one of the most amazing tools I've ever learned is the ability to self-reflect. And when I'm able to self-reflect, I'm able to be aware of what part of self is being affected. I can identify when part of self is being affected. It might be my security instincts or my sex instincts or my social instincts or my ego. And when I started to work out when, in specific scenarios, that part of self was being affected, I was then able to observe how I reacted in those situations. And what was interesting to me was my emotional regulation was often almost childlike. It was very childlike in some scenarios how I reacted to situations. It was. There was no regulation I couldn't see. All I could feel was my emotion. I couldn't distinguish between fact, fiction, emotion. It was just I was in the emotion. And yeah, this happened to me when I went through a 12-step process with AA five years ago and they have this thing called Step 4, where you've got to write down all your resentments and write down all your fears and you've got to look at what part of self is being affected and then you look at it and you review it and then you then get the mirror out and think, well, what part did I play in that? How did I what you know? It could be a harm, it could be a fear, it could be a resentment. So you take a little look at the part that you played in it, first of all to distinguish whether or not you could have done things differently or reacted a different way. And then there's like a section about harm. So if you cause somebody some harm, maybe through your own actions or through a fear or through a resentment or through a belief that was wrong and actually it was down to me, then I owed an apology to that person. So it's a really interesting concept and I suppose it's written. You know it's down in cognitive cognitive behavioral therapy is essentially what it is and it when they first brought it out with aa it wasn't that cbt came out a lot later on. So it was quite interesting to see it when they produced this kind of structure, how ahead of cT it actually was. But technically it was like cognitive behavioral therapy.

Speaker 1: 23:53

So when I started looking at CBT, then you can kind of look at all the different cognitive distortions that come up and the scenarios like what's the, you know like? I can't think of them now, but when you're compare and despair despair, for instance you know these things will come up and then how that makes you react. But actually, when you categorize all these different thoughts and these things that trigger these emotions, there's only a few of them. So you can start to categorize these feelings that are coming into your head, these emotions, into these like smaller amount of category. It's not that complicated. And then when, when you can do that and you can instantly put it into a category, you can then put that thought on trial and then, when it's on trial trial, you can decide whether or not judge a jury it's true or not? Is it false evidence appearing real?

Speaker 1: 24:42

And when I started learning that process and I did it on myself, it took time and energy to to work it out, but then it took me out of self and then allowed me to then see things from other people's perspective and I could then put myself in the other person's shoes is where I then started to build empathy and understanding for others, more so than I ever had done. And also, I always had empathy. But again, if you don't know how to categorize it within yourself? How can you help, how can you categorize it within somebody else? How can you approach somebody in a way that would manage the emotion that they're going through, or the feelings that they're going through, without experiencing it upon yourself? Like know thyself first before I can help somebody else. Does that make sense?

Speaker 2: 25:24

it absolutely makes sense. Um, and I think empathy is is, you know, there's there's different, there's different levels of empathy. There's one interesting model which I came across which is a mirror science model which effectively looks at the development of empathy in children and said well, I think everyone's born with this sort of ability to empathise with others and there's a development path, I think, up to about four years old, where children will say if you put a bunch of children in a room, two or three-year-olds, one of them starts crying, the rest of them will start crying, and maybe the first one started crying because someone took a toy away, but the rest of them start crying because they pick up on the other's emotional state and they share it. So it's like a mirroring effect and then, past a certain age, they effectively realise that actually that feeling state isn't you know the trigger, for it wasn't theirs. So I think we've all got this kind of inborn ability to kind of empathise. And there's individual differences between you know, differences between how people empathize as well, but we have this kind of different levels of empathy, sort of cognitive empathy, which is, you know, I kind of understand, you know how you're feeling, and then this is all shared empathy, which is actually, I feel it too, and we can do that as adults, so we kind of retain that ability to kind of share state with others.

Speaker 2: 26:51

But I agree, I think the there is kind of an element of you can be a bit you have to be a bit careful with your language and I think there is that very dangerous statement of you. Know, someone comes to you with something really serious and you go I know exactly how you feel and I don't know if you've ever had that, but you kind of go, no, you don't. Um, so you have to be a bit careful. You know with um, you know how you show empathy, but, um, I think, yeah, language and empathy is really, really important, but I think you can throw away yeah, I know exactly how you feel from your. Interesting on that point then, because I think that happens a lot and I think you can throw away.

Speaker 1: 27:30

Yeah, I know exactly how you feel from your interesting on that point, then, because I think that happens a lot and I think it's a natural way we want to show that we understand, but actually it can make the other person feel uncomfortable. So could it be something like that sounds awful now, how did that? How did how did that feel to you like is it more about then asking them a question and pushing it back on them to get them to tell you how they felt, but you've acknowledged that it must have been uncomfortable for them, and then you're asking them for their experience of that uncomfortable situation.

Speaker 2: 28:03

Yeah. So I think there are different ways of responding and I think some people, and especially advisors, they kind of naturally, gradually sort of gravitate towards asking a question, um, for further understanding, and maybe that comes from fact finding or just thinking well, what part of my job is to understand the client and ask, ask questions. But if you, if your first response is asking a question, which is what's called a searching response, you're actually dismissing someone's emotions. So, really, whose agenda is it? And if you're asking a question in response to someone telling you a story about something that's difficult to them, really that's sort of dismissing their emotion for your benefit, because you're just interested in finding out more information and you might think well, I'm doing it with good reason and that's because my question might help the other person think and understand, and fair enough.

Speaker 2: 29:03

But actually you're better off acknowledging the emotion before you ask that additional searching question. So if someone says look, I've got this scenario, yeah, absolutely, your first response is far safer, being that must have been really difficult for you Because you're acknowledging it. You're acknowledging the emotion. There's no agenda there. You're effectively because you might not have to say anything else after that. The person might just, you might just sit in silence and the person might go actually, yeah, yeah, and they might say something else, but it's called holding space.

Speaker 1: 29:44

So rather than dismissing it, so let's just um make a distinction very quickly between eq and iq, um what would you consider to be the main differences and why, in your opinion, is one better to focus on the other?

Speaker 2: 30:08

um, well, I think I think eq does does have its, you know, does have some of its, some of its origins, you know, in iq. So so IQ's been around for over 100 years and it's pretty rock solid in terms of the kind of volume of research that's out over the last 100 years. But again, there's still, even after 100 years, not total agreement in the academic space about what IQ is. But there's one theory which says, well, look, you can break it down, and I think this is quite good as a kind of about what IQ is. But there's one theory which says, well, look, you can break it down, and I think this is quite good as a kind of a understanding what what IQ is. You can break it down into fluid intelligence, which, if you, you know, like those verbal numerical reasoning tests, you know that you do they throw sort of novel problems at you and it's timed and it's how many you get right within a certain time. That's pretty much what fluid intelligence is. It's your ability to solve novel problems at speed. Um, and that declines as you age. Um, and I'd say I've learned a lot about this because I'm doing a master's in psychology. At the moment I'm just about to go to my second year. Um, keep learning, yeah, um, so fluent intelligence declines. Um, crystallized intelligence is the other other aspects of iq and you can call that knowledge and experience. So that increases across lifetime. Um, and I remember when I was at st james's place, um, chartered advisors, I think, probably earned about 30 percent more than non-chartered on average. So knowledge and experience we call that crystallized intelligence that increases across your lifespan. Interestingly, something I found in the research is fluid intelligence declines. So probably about 25 onwards. But you can slow the rate of decline through strength training. So go out and buy a kettlebell and pull a bar and just lift those every day and it'd be great for you. It'll slow down that rate of decline. But I think so.

Speaker 2: 32:11

Ei or EQ on the other side of things, that increases across the lifespan. And so one of those theories about why that is is that as you go through life you experience more of these, the highs and lows of emotions that come with life events. So life throws stuff at you when you deal with it and you learn from that. So we have something called emotional learning. So it's a bit like you were saying about the exercise that you did about looking at what your emotional triggers were for, for example, and reflecting about that. So the emotions have universal themes, that kind of trigger them. But we also have our own personal learned triggers and we learn coping strategies and mechanisms to deal with emotions. So EQ does increase across lifespan. So EQ does increase across lifespan.

Speaker 2: 32:59

But one of the main things that differentiates IQ and EQ is IQ can't be trained. So all of those brain training apps and stuff that say that if you sit here and do Sudoku you'll get smarter, it's nonsense. You just get better at doing Sudoku or you just get better at brain training apps. It doesn't transfer, so it doesn't increase fluid intelligence. But EQ can be increased with training and I think especially in kind of recruitment, with AI as an ability.

Speaker 2: 33:33

For example. You've got sort of IQ tests and those verbal numerical reason tests that companies use when you're recruiting, say, a financial planner or financial advisor. It's relatively pointless because everyone's got financial planning exams, some have got charters or some have got exams above that like CFP. So IQ has already been. The playing field has been leveled by the fact that the bar, the entry bar, is already high because everyone so financial advisors, planners you're already smart enough because you have to. You have to have been smart enough to pass the exams. So actually iq doesn't matter as much in terms of job performance with um within the financial planning profession, whereas eq does, because you can be the best qualified advisor out there. But if you can't empathize, you can't communicate, you can't regulate and manage your own emotions and stress that comes with the demands of the role. You're not going to be as successful as someone who can do all those things very interesting.

Speaker 1: 34:35

Yeah, that's very interesting. So you've done a lot of research, haven't you?

Speaker 2: 34:41

Yeah, yeah, but I would say I'm still scratching the surface with it because it's a huge topic.

Speaker 1: 34:49

Okay, can you just sort of share some of the research and what it says about EI and job performance in financial planning?

Speaker 2: 34:59

Yeah, and so when I was in my dissertation, part of that is you do a literature review, so you have to look at well, what does the research say about EI and job performance generally. And EI predicts job performance and that's kind of a blanket statement across many, many job roles. But when you kind of narrow it down and you look at well which job roles does it have more of an impact on? It's really those job roles which means that you deal with emotion as part of the job role. You know day in, day out, if emotion is part of the role, like financial services, then EI actually matters even more than it does for, say, you know another job where it's you're not dealing with emotions, it turns out. So the research is pretty conclusive to say that if you deal with emotion as part of the job role, ei massively helps and predicts job performance.

Speaker 2: 35:53

Some interesting things that I found there was a study looking at as you increase job complexity. This was in the 90s. As you look at increasing job complexity, how does sales performance, individual sales performance vary from bottom performer to top performer within firms, and they actually found that there was something like 120 times difference in financial advisors. So there's this huge gap between, say, top and bottom performers, that there was something like 120 times difference in financial advisors. So there's this huge gap between, say, top and bottom performance. And they placed financial advice at the top of the tree in terms of the most complex job that was out there and they looked at multiple different job roles for this. And I found that interesting because I just thought actually you kind of underestimate actually how demanding the job role is Because you've got especially if you throw in running a business to that as well um, so it's an incredibly demanding and complex job role. Um, so I think the ei and job performance generally says um, you know, predicts performance.

Speaker 2: 36:57

If we look specifically at the financial advisor role, if there have been some studies, including my own research, which were actually specifically looked at financial planning, there was one study which correlated it with sales performance. So they looked at over 700 advisors this was in the US and looked at their sales performance and they put them through an EI test and correlated that with their sales and actually found that as you increase, increase the I scores themselves, great sales performance goes up. There's another study which looked at term client retention, client referrals, and found that both of those go up as as the I scores increase. And then my own research I effectively found a similar result. So looking at client retention and EI, it was a small sample but yeah, there was a statistically significant relationship between client retention and EI scores for the advisors.

Speaker 2: 37:50

But one other thing I kind of stumbled across in the literature was I think a lot of listeners would be familiar with the sort of the Vanguard research about Advisor Alpha. You know there's this one or 2% per annum on offer that advisors can deliver through behavioral coaching. And I think the authors in that paper they said well, behavioral coaching is in order to do this. An advisor can act as like an emotional circuit breaker, helping their clients kind of navigate the emotions of financial decisions, helping their clients kind of navigate the emotions of financial decisions. But also they stated I'm paraphrasing here, but they stated that advisors need to be able to perceive and preempt clients' emotional triggers. And so if you think back to what I was explaining about the different quadrants of AI, what the authors of the Vanguard paper around how you deliver behavioural coaching are saying is, effectively, advisors need EI in order to be effective behavioural coaches. That's what stood out from that to me and I think there was another good study which I think was really, really key in terms of my development and thinking about the need for bringing EI training into financial services was that it has been done before.

Speaker 2: 39:10

About 20 years ago or 25 years ago, american Express ran an AI development program in the US for their financial advisors and they did this over four years, and so they effectively what they did was they got a cohort of financial advisors and they did this over four years, and so they effectively what they did was they got a cohort of financial advisors each year for four years.

Speaker 2: 39:25

They put them through emotional intelligence tests. They put them through a one-day workshop where they were being taught really, self-management skills and reframing, you know, cognitive reappraisal, you know some of the reflective things that you were talking about. They, um you know some of the reflective things that you were talking about. They were taught those, those types of interventions and they also did um a number of different things. So they measured sales performance. They measured uh trait anger, which is like a questionnaire you can look at how frequently you're you're triggered by anger, for example. They did another one on perceived stress, health outcomes, um, and then they ran this program for a year. So after the workshop each advisor got an individual development plan which looked at what areas specific to them that they needed to apply, learning to change their behavior, and then they had four coaching calls throughout the following 12 months and they were getting on average and this is over the kind of control group which was other advisors in the company an average of 25 uplift in sales from this development program.

Speaker 2: 40:27

So I think the range was about 18, you know the lowest cohort to 46 in the largest cohort. So that's. I found that just exciting because I thought, well, that was done 20 years ago. And when I was doing the, doing the research, research, when I had that light bulb moment it was like, well, it's so obvious that this is how advisors should be trained, in terms of that soft skills that sits along technical skills. I'm not a big fan of soft skills, by the way, because I think there's nothing soft about dealing with a grieving client. It's hard. Those difficult conversations are challenging. I'm not a fan of the term soft skills, but it had been done and I just thought, well, someone else is going to be running this training program, is going to be doing this, and the answer was no. So I just thought, well, there's a gap that I can fill.

Speaker 1: 41:17

I love that. Soft skills, right, it's a word that gets thrown around to describe it. What would you use instead?

Speaker 2: 41:27

I think hard intelligence is probably a better term. So you know, it's a hard intelligence, it's not a soft skill. Okay, it's not a nice to have.

Speaker 2: 41:37

It helps you deal with the difficult things, stress. You know grievances and it's not just dealing with clients, it could be. You know you run a business you have to do performance reviews for. You know you have to recruit people. Um, you know, I think ei in recruitment is is really important as well. I think um because it's an ability. Um, you know, when you're assessing candidates, for example, you know qualifications are helpful but they're not going to tell you if people have got those skills to empathize, communicate effectively. Verbal numerical reasoning doesn't work because everyone's smart enough anyway yeah personality tests.

Speaker 2: 42:13

Companies use those quite a lot.

Speaker 2: 42:14

So, like the hogans or disc, you know things like that yeah um, they're all self-report measures on the whole, which basically means that if you're the candidate, you get to decide what the answers are to the question, so you can just answer it in a way that you think is going to get you the job. So you can go yeah, of course I'm hardworking, of course I'm creative, whereas an EI test that's ability-based you can't cheat that. You either have the ability or you can't cheat that. You, you either have the ability or you don't. Um, but actually testing provides a really good baseline for training because it sort of says well, look, here's where you are, here's your strengths and weaknesses. Let's convert that into an individual developer plan and let's turn that into, you know, let's maybe put in some coaching, coaching calls and actually look at how do you, how do you change?

Speaker 1: 42:59

james, I'm really interested in the recruitment side obviously. I've just come into hoxton, I've got a background in recruitment, um, and we're always looking for new ways to attract the right talent into the business and fit the right talent into the business. But the conversation you're having, the points you're raising about the research and the impact it has on the bottom line when you start to actually train and measure emotional intelligence I think it makes total sense to do that at the beginning of the journey in the in the recruitment process. Could you just share with us some ideas around what companies can do right now to start measuring this emotional intelligence or checking it in the recruitment process?

Speaker 2: 43:40

yeah, so I think one of the services that, um, that I offer is is, uh, it is an emotional intelligence assessment. Yeah, um. So let's say, the company had, um, five candidates that they'd shortlisted and they just thought, well, actually, these, these five, are brilliant, you know, with their past, you know, whatever interview stages are, we're really struggling to narrow it down um, we could put them through an emotional intelligence assessment and then I could whatever interview stages are, we're really struggling to narrow it down we can put them through an emotion intelligence assessment and then I can sit down with the hiring managers, look at the scores and reports and give them some feedback around what strengths and weaknesses of each candidate to help them make a bit of a better decision.

Speaker 1: 44:15

Is it something that has to be done with a person in the process, or can this be done through video? Can it be done through recording stuff? Is AI starting to catch up with machine learning? Is that starting to catch up with this whole concept of emotional intelligence and recruitment?

Speaker 2: 44:37

I think, and you so. I'm just trying to understand the question. There is this on the interpretation of score, or is it on the assessment.

Speaker 1: 44:45

I'm interested in measuring emotional intelligence. Yeah, we talked about recruitment and that actually, in the recruitment process, measuring emotional intelligence is um better than things like personality tests etc. Yeah, how do I do that? I want to do that today. I want to do it today, right now. Would I have to have someone like yourself in the process, who's like an emotional intelligence expert and you're involved in it, or is there a program or a test that can be done? How do we measure emotional intelligence in the recruitment process?

Speaker 2: 45:24

good, um, okay, so the measurement, the measurement tool it doesn't necessarily need need me to administer a test. For example, um, the, the emotion intelligence measure measurement tool that I use is was developed by motion intelligence academy. Um, which I use, was developed by Motion Intelligence Academy, which I work quite closely, and the tool works on the basis of the score is added up between three different elements of the assessment. So participants go through the assessment. They'll do a self-report initially.

Speaker 2: 45:58

Participants go through the assessment. They'll do a self-report initially. So the first section they'll go through is looking at self-report questions about emotions. They'll then invite people to do a 360 analysis. So they'll maybe select two or three people who will rate them on those questions and then they'll also complete a knowledge-based, ability-based test, which includes things like situational judgment tests, um, of how would you react to this type of situation. And the reason that you need all three of those is because, well, I've mentioned it before about personalities that if you just give people self-report potential or bias, that they'll just answer it in the way that they think is favorable yeah so self-report um requires honesty, um, and there is this.

Speaker 2: 46:48

And also it requires people to have really really razor sharp perception of their own um, of where they are and their own strengths and weaknesses. And we don't all have that um the 360 does. What that does is it does well, okay, you've rated yourself this way. How do others perceive you? And that's really important for ei because, again, it's not just about you, it's about how you interact with others. So you might answer it and say I'm really good at um, managing anger or managing stress, and other people might say, well, no, you're not um. But so you get this kind of difference in scores between self and other um.

Speaker 2: 47:26

But really the the big one is is how do you score on the ability tests? Because if you, if you say you're good um, you have to perform at the same level, otherwise it knocks your score down. So you have to be self-aware of your abilities and have that match up with the ability test. So the assessment triangulates all three of those to give you an EI score and then the interpretation of those scores. There's no reason that firms couldn't interpret the reports themselves, but sometimes it helps to have an expert to say well, actually, here's what the report says, and if the decision is, it's a big decision for a role that's high stakes enough that you need to get it right. Maybe you want to bring in an expert just to compare the two reports and give their opinion and just think, well, actually, what this candidate has got, these strengths and weaknesses this candidate has got these strengths and weaknesses.

Speaker 1: 48:27

This candidate also those strengths and weaknesses. If, um if, for example, you wanted to train emotional intelligence like train the trainer, so you said about getting an expert in, is that something companies could actually do? Could they do like a course on it and then have like an emotional intelligence expert within the hr and talent attraction team, for example?

Speaker 2: 48:42

so one of the things that one of the things that I've been working on is is um, developing an emotional intelligence training program. So that's so. I've got a website that should be live over the next couple of months and I've got some time in the studio in in two weeks time to record the, the knowledge element of that training program. So once the website's launched over the next couple of months, there'll be a learning management system and portal where people can go in and access the course that gives them the knowledge and understanding to develop the skills in EI and then apply that to their job.

Speaker 2: 49:19

What we're looking at doing long term with that is absolutely doing that is, instead of me delivering it or, you know, people going in and buying it online is for larger companies who say, well, we want someone in house as an expert, and that's one of the things that's on the on the to-do list long term is to yeah is to have a train the trainer program where we come in, and you know we. To yeah is to have a train the trainer program where we come in and you know we we take someone through the the train the trainer program so that they can they can access the assessment tools, they can interpret the reports, they can coach, mentor in-house. Um so yeah, that's absolutely something that's that's on the agenda very interesting.

Speaker 1: 49:54

I really like the sound of that one. Definitely keep me in the loop with that, james, because I I think this is brilliant. I think this is definitely something that, hoxton, we want to get stuck in into also. I've got the academy. I think it's a brilliant thing to try to adopt and adapt into the academy as well. And I think most onboarding, most companies who are onboarding new advisors, will want to know about this um and want to start implementing it, because recruitment's a bit crap in financial planning it's, it's.

Speaker 1: 50:21

And when you're saying like one of the most, you go back to your kind of list of come lift a list of different job types and financial planning being the most trickiest one at the top and the most requirement for emotional intelligence, um, and I think the more we bring ai in and tools in, they're going to take away some of the jobs that take us away from being in front of clients, in front of people the more there's going to be a need for us to be more emotionally intelligent. And I think having a high level of emotional intelligence is going to make you more marketable in the future as a financial planner or as an employee, as a person in general, because I think what's going to be happening with the future? All the mundane jobs will start to be taken away and what it's going to do is push us more closer together as human beings, and we're even going to get on and we're going to hate each other and tear each other apart. So it's the person who's got that high level of emotional intelligence is going to win. Right, because not only are they capable of managing their own emotions, but they're capable of also managing other people's and recognizing it as well. So it becomes it becomes a huge skill, doesn't it?

Speaker 1: 51:22

It becomes this amazingly like sort of the more I work on my emotional intelligence, the the further I've gone in my career. It's as simple as that. You know. It's had such a positive impact on me. What's what's interesting for me is I don't know how to measure it apart from a byproduct of it is that my life's getting better, that I'm happier, that I get on with people better, that my job enjoyment is higher, that I'm being paid more. Um, I'm doing more interesting work and I've got more responsibility and I can cope with it better. Yeah, these are great measurements, but I would love to. Can you actually like, let's say you get 100 people in a room. Right, could you? Could you literally grade from top to bottom who's the most intelligent in emotionally?

Speaker 2: 52:06

if you did an assessment, yeah, so.

Speaker 1: 52:09

So you could come into my business with 300 people in it and you could literally create a league table of who's got the highest level of motion intelligent and who hasn't, and then we can look at that and go right, these people need to work on their emotional intelligence so.

Speaker 2: 52:22

So this is one of the conclusions that I made when I did the, when I did my dissertation. Is that um? So it's a bit so I've got to tell you something else before before I can answer this. So one of the things with um, so do you remember I said there's about 120 times difference between top and bottom performance in in that that study, when looking at advisor performance Because advisor performance whenever I'm just assuming that advisors have got uncapped earnings I see something I'm making here. So if you've got a firm that's got, say, 300 advisors, let's assume those advisors have got uncapped earnings, they're self-employed or they're fee earners.

Speaker 2: 52:59

What happens is your distribution of performance is a bell curve, like height, for example. Um, you know, and the bell curve is that right. So heights, you know everyone's five foot, not. You know the average for men is like five foot nine, um, and then you kind of you've got who are really, really tall, as you go that way, and you've got some people who are short, as you go that way, but everyone's kind of within an average height.

Speaker 2: 53:29

And for companies where you've got, say, people who sell things and they produce things on their own fees, it is not not that shape. It's this shape flat massively up, and so what that basically means is that at the top end here you've got you've got effectively a small number of people it's the square root of the number of people in the organization but there's a small number of people who do a hugely disproportionate amount of the total production. And then you've got just below that you've got people who have got the potential to become those people. So they're on the upward a bit of that curve. And then you've got people down here, sort of on this on the flat bit, and this is being pretty ruthless.

Speaker 2: 54:13

But if I was running a company with 300 advisors in it, I'd spend all of my training budget on the people that have got the potential to move further up the curve, because that's where you're going to see the biggest increase in company productivity. So you could do an assessment of 300 people. You could let the people who are already killing it leave them alone Like they're successful. Don't mess with that. You know who they are. Leave them to it. They've worked out how to do it and it's the 20 percent maybe below that.

Speaker 1: 54:45

That's where you want to spend yeah, maybe 80 percent of your training budget and that's, and the testing that's in place that you can also offer, that you're working on, is a way to identify that, that percentage of people that really need this extra support, training and development around EQ.

Speaker 2: 55:02

Yeah, absolutely, because it could be that, let's say, you've got someone in there who just needs a bit of help with recognizing unpromotions in others, or they need a bit of help with self-management. You give them that knowledge, you train the skills, you drop in a bit of coaching to make sure that they take the knowledge and apply it at work to change the behavior. Yeah, and all of a sudden they might go from a you know, say a you know top 25 percent to a top five or ten percent do?

Speaker 1: 55:31

do we have any idea around time scales of implementation of um starting to work on your emotional intelligence, or EQ, to productivity going up?

Speaker 2: 55:43

So if you look at the American Express figures I gave you, that was a 12-month program 12 months okay.

Speaker 2: 55:49

So what I've done with the development program that I've worked on is it starts with an assessment and then you go through a three. If we're running it face to face, it's a three-day. Three-day workshop, yeah, um to get people on the knowledge, but then, with american express, the learning came from having um four quarterly coaching calls to apply the learning. So having the knowledge and just attending the workshop or doing reading is one thing, but it's not going to lead to performance unless it leads to behaviour change.

Speaker 1: 56:32

Which is the accountability part, the checking in with the school leader.

Speaker 2: 56:34

Personal development plans, identifying actions for improvement, then actually following through and doing the work that leads to behaviour change, because if you, if you don't do anything differently, don't expect an increase, increasing performance. American express they did that within 12 months. Um so so.

Speaker 1: 56:52

So how many check-ins did they have? Sorry, four, yeah, four every year, yeah and then there was like, say, with those check-ins, what were they checking in on specifically?

Speaker 2: 57:05

um, I don't think the detail was in the paper, but I wouldn't be surprised if they were looking at, um the pdp plans that they set up, so those individual personal development plans, um, and they were looking at how people would make progression against those developer plans. It's the type of thing that you would do normally as a performance coach you would tick off things that have gone well and boost confidence via highlighting successes, you would discuss and identify areas for improvement and you would constantly be updating and redoing that PDP plan.

Speaker 1: 57:46

So like the most impactful way to start looking at EQ within a financial planning business. Right? Can I make an assumption and correct me if I'm wrong, or add some more meat to the bones? Would it be looking at the recruitment process at the very, very beginning, and would it be looking at what your current let's say your current financial planners EQ actually is and identifying the area where you can make the biggest improvement? Would they be the two areas that you would implement EQ into a financial planning business that wants to grow?

Speaker 2: 58:20

so I think, yeah, it's.

Speaker 2: 58:22

I think assessment is a good starting point, yeah, and then, once you've done the assessment, you can look at um, what training needs are there, and then you could effectively deliver the, the knowledge-based workshops, which gives people the knowledge, and then really you you've.

Speaker 2: 58:42

You can then identify what individual support is needed for people that are going through the program. And because EQ it varies, some people are naturally very high scorers, so you don't really need to invest as much in development behavior change with the people who are scoring high naturally than you would do with, say, people who need a bit of help increasing their score. And I would say one of the things that I think will be on the online course, when that's available, is so we'll test at the beginning, we'll teach and then at the end of the learning programme you get an option to, I think, do unlock the other, I think, a couple of parts of the assessment and if your ei score is above a certain benchmark, you get a certificate in applied emotional intelligence for financial planners. So I want that to be a qualification that people can take out and take to companies and say, um, I have any, an eq score of 140 plus, because that might just give them the edge when they're applying for a job how long would that then take to get that qualification?

Speaker 2: 59:55

um so effectively. The I mean if they. It depends how long it takes them to go through the, through the, the workshop um in their own time, but the it's probably gonna be about eight hours. I think you've recorded, recorded material, so it's not like some kind of year-long course or anything like that.

Speaker 1: 1:00:18

It can be done pretty quickly and actually it becomes quite um interesting, especially on that new entrant level as well.

Speaker 1: 1:00:25

So a new like, for example, look at my academy right, I'm pull people into it who are currently working in different professions at the moment. They come into my academy, they start doing their cii qualifications and they start learning some of the other skills required to be a financial planner and they connect the community. But actually if they also do this within it, that's that's really powerful, because when they end up going out to market themselves to companies to take them on, they can say look, I've done the financial plan life EQ test. So I really love the idea, I love the sound of that. I think it's amazing. I think that should definitely be in academies and in general and companies that are hiring people and um companies that are hiring people, I think also as well. It comes in really handy as well for, let's say, somebody is coming into that company that may be coming straight from university um that might not have had that length of time in life to build eq um as quickly or as through experience.

Speaker 1: 1:01:19

Right, so that's a really great. Why don't they teach this stuff in school? Do you know what I would love to learn all of this in school like this, because it's like I'm looking at run into 12 steps. I was like why the hell did they not just teach this in in school? Because it would have made like I try to teach my daughter, you know, I get it, she's young and I'm gradually teaching her things around resentments and fears and our emotions and we talk and we listen and we open up.

Speaker 1: 1:01:45

But it's like none of that shit was taught to me in school and I was desperately somebody who needed it.

Speaker 1: 1:01:50

You know, I needed that emotional intelligence because I was so energetic and such a thinker and such a I mean it was distractible and all of those things you know, and I was, I was energetic and I needed to be able to understand my mind and and also I grew up in a quick bit of a crazy environment. So I, you know, I you just kind of get stuck into school and they chuck you down the book learning style, don't they? And I think, you know, do that as opposed to actually be a good human being and understand, like, how others think and how you think, like, and that's going to actually have huge amounts more value in your life than just sticking your head in a book. You know, it's my personal opinion, right. Ever since I've, ever since I've hyper focused on emotional intelligence, mindfulness, my life is vastly improved, vastly improved, and I'm not the most academic of people, so if I can do it, others can definitely do this and improve their lives as well it's um, it is, it's a skill.

Speaker 2: 1:02:41

I mean the.

Speaker 2: 1:02:43

When I was going through the, the, the kind of the, the msc, and learning about you know motions and triggers, and uh, it was during that time that covid hit and we all had to go in and get you know our vaccines and up until that point I'd had like a lifelong needle phobia, you know.

Speaker 2: 1:03:03

But I can, I can pinpoint to use a, use, a pun. Yeah, um, the point in my childhood I think, when I was pinned down in a doctor's surgery to be given a, to be given a vaccine, yeah, from that point onwards, um, I just had this huge fear of you know dentists and just really injections, blood tests, you know I was like the blood would drain out my face, you know I'd feel sick and you know that real kind of like intense phobia response, um, but actually it's, it's emotional. That is what emotional learning is is that you get a scenario, you get intense emotions and they effectively you, you get this kind of um, it's like a, a conditioned stimulus. Is that the minute you see a needle, the fear as a case it's in the drive it's running.

Speaker 2: 1:03:52

Yeah, Um but learning mindfulness, learning how emotions worked um, appreciating that they were reactions and that they just appear in consciousness and that you can observe them and that then you can appraise them and then react and decide whether you want to let them rule you or you rule them. Um, I'm not scared of it anymore. Like I walked into that first vaccine, sat in, sat in the waiting room, shut my eyes for 10 minutes, went in no fear response. So this is what I mean is that it's and I only learned how to do that by being taught the skills to be able to master that.

Speaker 1: 1:04:37

Yeah.

Speaker 2: 1:04:37

Control of it rather than it have control of me.

Speaker 1: 1:04:41

Yeah, I went through a similar scenario. He used to show me a needle I would literally pass out. I remember as a kid in the doctor's surgery and he was like, yeah, I'm gonna have to give him injection.

Speaker 1: 1:04:49

I was like I'm just gonna go to the toilet a minute and I remember I locked myself in the doctor's toilet. My mom was like can you come out? I was like there's no way in the world I'm coming out if he's gonna stick a needle in me. And that was from being a kid and having this booster yeah, injection when I was near to africa and it was horrendous. But as life's gone on and I've kind of adapted, I've I've got a real tolerance now actually for that type of thing. I was in dubai actually and I had a bloody neat infection in my finger and they had to tear my nail off and like drain it all it was, it was and I was just like, yeah, go for it. I knew that it was going to be horrible and painful, but I knew also it wasn't going to be forever and it's more painful to keep that infection there. I could lose my finger and all that sort of stuff.

Speaker 1: 1:05:28

So you kind of rationalize things a lot more as you get older. You emotionally kind of regulate, don't you? Yeah, I wasn't in that childlike emotion that I was feeling when I was six years old, locking myself in that toilet anymore, so it's really, really good. How do you, um, how do let's just get on to the bit like before we kind of end this podcast episode like I talked to you all day, but how okay? So let's just look at the, the impact that this could have on financial planners. Then, yeah, so it looks like on the recruitment perspective, but what about financial planners in their day jobs? How is it going to improve their lives if they work on eq?

Speaker 2: 1:06:03

I think two elements really is. Let's just talk about stress, because that follows on nicely for what we've just been talking about. It's a demanding role, it's a stressful role and I think exactly what we've just been talking about recognizing and managing that translates into into job performance, um, so that's that self, self-awareness and self-management element, um, and ultimately that's you know, the kind of that's what american express focused on. You know they, they were giving people interventions to understand emotions of themselves, you know, and sort of do that reappraisal element. Well, so there's that element is understanding yourself makes you more aware of how you look after yourself, and the minute that you kind of focus on that, you get the right habits in place.

Speaker 2: 1:06:59

You know, you start, um, if you, if you are stressed, for example, you just think, well, actually maybe I need to. You know what one hypothesize, what is it that's going on? Um, what can I do about it? You know, do I need to take a break? You know, do I? You know, do I need to? You know, go for a walk? You know, at lunchtime, you know, whatever it is, but if you get sort of better at sort of tuning in with with yourself and coming up with the tools for managing it, you can you can.

Speaker 2: 1:07:22

You can translate that into job performance. But I'd say the big payoff is understanding others, because that's a massive part of the financial planner role is building rapport with clients early, because that's key for them. Opening up and sharing information with you. It's going to help you do a great job for them. Running that kind of discussion about hopes, fears, goals, wants.

Speaker 2: 1:07:51

Having that discussion and communicating with clients about their plans in a financial planning context, you need to understand and recognize and respond to emotions there to build trust and then dealing with the difficult conversations that come. So a client comes to you and they're annoyed about performance. You know negotiating fees. You know if you run a business negotiating. You know buying another business, negotiating, selling your business, eventually Building and managing a team as well, you know. You then become a leader. You know of a business. You need AI to recruit people and attract them so that they follow you, and that's one of the things that this was in.

Speaker 2: 1:08:33

I think the research that I did as well is that one thing that sort of separates entrepreneurs and managers is that entrepreneurs are really, really good at recognizing their weaknesses and hiring people that have got strengths. You know that that complement and actually inspiring people to to kind of follow them. But you don't do that by being a micromanager or being dismissive of your colleagues emotions. So if you're on this journey, if you're, you've got a financial. You know you want to be a financial planner who's going to eventually run their own business. Ei is going to help you from beginning to end okay, beautiful.

Speaker 1: 1:09:10

Yeah, I love it.

Speaker 1: 1:09:11

I'm definitely going to continue our conversation anyway and explore this further because, yeah, 100, this needs to be implemented at hoxton.

Speaker 1: 1:09:20

I think it would have so much value and because we're such a young company I think I going for six years, we've got young people in it. I think you know, being able to implement this early doors in the, in the recruitment process, from the very, very beginning and all the way through, I think it's going to be powerful. I think it also just from a so you've got a recruitment side but then, once you've gone through the recruitment side, you're then moving in, in then to the training side and that's where it goes. It goes from recruitment into training and then it goes into on the job. So to measure that emotional intelligence and to train it and develop it throughout the career of an individual that works within your business and to monitor it, I think is powerful. And if you can track it and you can monitor it and you can look back over one year, two year, three year, the impact that that's actually had, that is exciting. That, to me, is really exciting.

Speaker 2: 1:10:11

Especially if you run those sort of train, the trainer programs as well, because so, for example, like when I was employed, we used to have once a month your manager would come and sit in a meeting room with you and they'd observe your meeting, you know, with your client and they'd make some notes.

Speaker 2: 1:10:28

But if you've got someone in the room who was a trained emotion seller, who's a trained emotion intelligence trainer, who's gonna learn the skills of perceiving and recognizing emotions, um, they're gonna be be, they're going to have a different um, like a third, a third eye in the meeting. Um, and that's immensely useful for feeding back to the advisor about areas for development, because it might be the most be like look, did you see that that client had a slight facial, micro facial expression of fear when you mentioned, um, their investment performance to be in front of? No, I missed that. But okay, you need to follow up and maybe have a conversation another day about how your client is feeling about their portfolio at the moment, and all of this is about massively enhancing the client experience. So I think actually having someone sat in a meeting room who's trained to you know, to observe and pick up on these things as well, is massively key, but do we?

Speaker 1: 1:11:26

have emotions. We've got AI right. We've got machine learning, so the ability for me to sit down with you, right, and we're talking to each other machine learning would be able to observe our body language, our language, what we we say, how we say it, how we respond, and then create a measurement and a score at the end of emotional intelligence. Are we there yet? Have we got anything like that? You're aware of? That's out there because that's powerful, because the more, the more we're actually also on, because, from a compliance perspective as well, I reckon, like if you were measuring, like a, how you're interacting with the client, are you saying the right things? Are you recognizing vulnerabilities in clients as well?

Speaker 1: 1:12:11

Because it's a big thing, yeah, recognizing vulnerable clients, but then to actually use it as a training tool around emotional intelligence is powerful as well. And if I was on a call let's say I'm doing 10 calls, uh, 10 video calls a week right now at the beginning of that week mine was a score of 56 on emotional intelligence and it actually measured it and gave me back some feedback and I would then improve, try and improve my score on the next go and then the next go, and then over that week I can actually measure my score going up, but it's all done through machine learning and is there? Are we there yet? Is that futuristic, or is that actually happening, or what?

Speaker 2: 1:12:51

I'm just thinking of a way to answer this that doesn't take half an hour, Because that's quite a big question.

Speaker 1: 1:12:56

that one Is it Right.

Speaker 2: 1:13:00

So the reason that it's quite a big topic is when what we teach on the Emotional Intelligence program is six channels that we use to communicate. So there's the face, facial expressions. There's the voice, which is pitch, pitch, tone volume. There's our body language. There's our verbal content. There's our verbal style, which is how we're interacting, and then there's our psychophysiology. So psychophysiology is things like how emotions also affect our physiology. So if you think about stress response I mentioned that draining from the face with the sort of neophobia if you were sat in a room with me watching me have that, you would see my face get paler. So I'll give you an example For a machine to be able to do that, you would have to have a thermal camera in the room that would need to measure pupil dilation, breathing rate, it would need thermal imaging to see where blood flow is going.

Speaker 2: 1:14:02

Because actually, as an observer, you can pick up on these things. Say, for example, if I'm talking to you and all of a sudden your ears change colour and go red, I might think hang on a minute. Why are you? Why has your blood pressure gone up? Because your blood pressure, you've got small capillaries in your ears. So if your blood pressure goes up, the blood's forced to the surface and your ears will change colour. If I can perceive that and pick up on that, and maybe there's a few other markers across those other channels, I might think well, actually you're experiencing something here. So you have to gather data from all those six channels, know how to read them and know how to interpret them. And don't forget that it's not going to make a diagnosis and say this person's experiencing this.

Speaker 2: 1:14:45

It's a hypothesis and the only way that you're going to test that hypothesis is by interacting with the individual opposite. You and just basically been saying, like I said, sam, I noticed you seem a bit, a bit unsettled. I'm not saying you is a change color. You might be settled, um, is you know? Is everything okay? Is there something about this conversation that's not sitting right with you and that might just prompt you to go? Actually, I wasn't going to say it, but this has been on my mind. Okay, and that's what I mean about this perceive. And then it enhances the interaction and maybe you get a bit more information that enhances and strengthens the relationship.

Speaker 1: 1:15:23

The good news is you've got a book coming out soon, in October. What's the name of the book?

Speaker 2: 1:15:28

The working title at the moment is the Heart of Finance Excellent Emotion Intelligence for Financial Planners.

Speaker 1: 1:15:36

Fantastic and just give us a brief overview of what that will actually cover.

Speaker 2: 1:15:40

Yeah. So I've co-authored that with Cliff Lansley from the Emotion Intelligence Academy, who's got a PhD in EI, and so what we've done is we've come together and we've blended kind of practitioner and academic experience and the book has been written in a way that we get foundations and definitions out of the way, so we give people sort of technical bits they need to understand and then we look at the client journey. So what do you do in preparing for meetings from the AI perspective? In that first meeting, in a planning meeting, if you're having sort of a goals-based financial planning discussion, presenting your solutions, so it talks about vulnerable clients in there as well. And then ongoing service.

Speaker 2: 1:16:20

So how do you build AI into your ongoing service strategy? And I think that's one of the things which I think could be a real growth area. You know you mentioned about AI machine learning. I think the bit that the machine can't do yet is that human interaction element. But what I think is really exciting is us getting into this world where you've got a highly emotionally intelligent advisor who comes out of a meeting under with a deep level of understanding about their clients fears, triggers, you know, hopes, wants, dreams. They put that in their crm system which has got ai linked to it, that ai pops up and just goes um okay, markets are moved or legislation's changed.

Speaker 2: 1:16:59

These are your top clients in terms of most likely to be anxious about, about what's going on pick the phone up to them and just reassure them, because now you're using your crm um and you're as part of your business process, to create an emotionally intelligent business, and so that, I think, is really cool yeah, wow, an emotional and actually emotional intelligent business yeah yeah, that's amazing yeah, that's your room. Could deliver that is that?

Speaker 1: 1:17:28

is that like in place now?

Speaker 2: 1:17:31

I mean there's no reason why you couldn't do it. You could just categorize clients in terms of I mean the way that I wrote this in the book, because I was like, look, the things you, you want to, you want to be, um, pay real attention to is anxious clients and, at the end of that, impulsive clients. So impulsive clients are going to be the ones that come to you and just say you know, I've got this idea, what should I do with it?

Speaker 1: 1:17:47

and just go okay, calm down so is this based on, like our interpretation of the client, or is there a way to implement it into the fact?

Speaker 2: 1:17:55

find that actually picks that up um, it's our interpretation of the client. But but I mean, the part of what you would do is that you would have, you could build into your, say, client fat, find or however you have, say, a risk discussion or or the questions that you ask about as goals part of a goals based, you know, planning discussion. You could build into that a discussion about emotions, triggers, what the client's own personal triggers are might be around money, and you know, collect that and just say, well, look, if I'm building a bespoke communication strategy for you, what would that look like? Do you want long reports from me? Do you want bullet points? Do you want videos? You know, do you want infographics so that you're thinking about, well, actually am I presenting information in a way that the client wants to receive as well? And then you're building, you can build into the service strategy how frequently and what type of communication the person is going to want to have from you.

Speaker 2: 1:18:51

Very interesting and it's back to that piece I said about all vanguard said, about to be an effective behavioral coach, you've got to anticipate clients triggers and you've got to anticipate the things that might make the client stray from the course. You know that financial plan that you've laid out for them. So it's not just about doing that once a year. You've got to think well, actually throughout the year, what could, what could come up throughout the year?

Speaker 1: 1:19:16

that is the only client's ability to stick in the plan also when you said there about the way that they interpret information, right, that's so cool because if you understand their preference and how best to respond based on their emotions, with ai and automation, there is nothing to say that when the announcement or bulletin comes out, right that it's written in a script, that that can automatically go into a video of me where it changes my mouth and the script then uses my tone of voice and creates a video straight away.

Speaker 1: 1:19:55

So if somebody prefers someone's kind of oh no, they're going to probably be a bit flappy at the moment because the markets are changing, but they love to see me face to face because it gives them reassurance and comfort then it will trigger that the video bang from the, from the bulletin to the video, to being in their mobile phone on a whatsapp saying hey, sam, don't worry about the markets. You might have read today that this is happening, but the other person might want an email drop in their lap or they might want to text or they might want to be direct. You know that's like insane when you start kind of connecting how that would actually work based on the emotional profiling of your clients. That's amazing, like that's. That's another level, isn't it really?

Speaker 2: 1:20:35

well, I think that's the future, isn't it? So you know, robo, robo advice, you know ai is going to get going to get better, and I think so. I think I think there's one hypothesis that actually financial advice businesses in the future. They deal with fewer clients, but they have a far better understanding of them and they deliver far more for fewer.

Speaker 1: 1:20:58

Yeah, I like it. You've definitely found a bit of a niche here, haven't you? Is there many people in the UK doing this, like what you're doing, or is it mainly US?

Speaker 2: 1:21:10

I don't know. I think there are very few people that are looking at combining emotional intelligence with financial planning and actually looking at developing training programs that are designed to lead to performance increases.

Speaker 1: 1:21:26

Have you linked in with timeline? No, you should definitely link in with timeline, like reach out like I don't mind. I think I know that hannah in marketing abraham I've seen. Obviously his presentations are always very good but from a behavioral perspective this ties in beautifully and they're so forward thinking that I think they would lap it up, mate.

Speaker 2: 1:21:49

Yeah, well, I think the behavioral element. I think there's a lot of you know good high quality content out there about behavioral finance and advisors I speak to generally about behavioral finance tend to say the same thing, which is it's really interesting. I love reading about it. I'm fascinated about how cognitive psychology affects may affect how my clients make decisions. I'm not 100% sure about what I do with that and that's why I think EI fills that gap. Is that EI is about giving you the skills to be in a meeting and read and respond live, and I think that's got far more utility. I think, kind of like behaviour evidence Analysis.

Speaker 1: 1:22:39

Yeah, behaviour evidence and EQ, all kind of.

Speaker 2: 1:22:43

It ties together, yeah.

Speaker 1: 1:22:46

Ties together beautifully, doesn't it? Oh, I really love it, mate. Really love it, mate, I love it. I'm really pleased to come on the podcast.

Speaker 1: 1:22:49

That's really got my brain thinking, I mean, I could keep going yeah, I know it's got my brain thinking, you know it's got me, it's got me whirling away and you know I'm so, I'm so pleased I'm in financial planning now, working within financial planning, and I'm in quite a luxury really in the job that I'm job pleased I'm in financial planning now, working within financial planning, and I'm in quite a luxury really in the job that I'm in is that I can influence things.

Speaker 1: 1:23:09

Yeah, and also I've got a background in recruitment as well, and obviously I understand financial planning, I understand financial planners and I can come in with a bit more of a creative sort of style, if you like, and look at ways that we can improve things dial, if you like and look at ways that we can improve things. And I think when people have been in the world of financial planning for so long, it's often difficult to change your perception or your thinking about doing things, and I just feel like this is like really cool. So I definitely want to know more and I definitely want to kind of, what I would love from you, right, is same as probably anybody else listening to this podcast is like where can I find more information about this? Where can I? You know what? Where is there like a roadmap to what can be done so I can implement this in our business in the right way? How do we work with you? Thank, you.

Speaker 2: 1:23:51

Well, I think the um. I've got a new website. It's going to be launched over the next next couple of months and when that's launched there should be the um online course that people can go and go and go and do themselves. Yeah, that's, that's going to be for individuals who want to, who want to engage with the learning um. They can go and go and do that and work through it in their own time.

Speaker 2: 1:24:15

Um next year I still work out let's do this is that I'll I want to run a series of kind of face-to-face workshops. So I think the face-to-face learning environment is brilliant. But I just need to kind of sort calendar out when I'm going to do that. So we've got our second baby on the way in September. So end of the year we're going to have two under two in the house. It's going to be mad, but I'm really looking forward to it. So next year I want to get back to get some live workshops in the diary. That again, this will be for individuals. They'll book on and we'll run a cohort of probably 12 to 25-ish. But for businesses that want to do something in-house, let's have a conversation. Well, I think actually anyone who wants to have a chat about it. My diary's open and let's talk.

Speaker 1: 1:25:09

I think we've got our own CRM at Hoxton. It's really good, it's all built in-house and we've also got our own app as well for clients, which is all interlinked. It's really like they're so tech-focused it's ridiculous. I've got about 25 people in the tech team. I might be interested in you actually speaking to the tech developer and sort of talking about the CRM integration and your ideas around CRM integration. I think that would be quite a cool conversation to have. Anyway, I think it would be interesting and it might spark some real interest. So I think I'll try and sort that out for you, um, and see what you think as well.

Speaker 1: 1:25:47

Um, and obviously the benefit that I think people, the benefit you have, is that you've come from financial planning. Right, you're not, and it's not to say that someone who's come outside of the profession can't add value, but I think that your lived experience of it is, um, it's hugely beneficial. And also you've run a business so you can kind of relate, so that's good. Yeah, amazing, listen, appreciate your time. Today I've just had to cancel a meeting because I'm just more interested in talking to you, whoopsie daisy. So, um, thank you so much for your time.

Speaker 1: 1:26:17

I found that really really interesting. It's given me so many ideas, um, and it's you just sent me off on a bit of a tangent in my mind, so really, really appreciate that. Send me a load of hyperlinks to things that I can look into, um and research, um, and I'll put that on the show notes as well, or anything where people can find you and connect with you and stuff. So send me that across and I'll make sure that goes on the show notes. But I also, for my own benefit, I'm really interested in getting stuck into this. It's really really interesting yeah.

Speaker 2: 1:26:45

Well, linkedin is probably the one that we're most active on, so it's easy to get hold of me on LinkedIn. All right, so the emails, james, at raiseyoureicomuk, we can get that from my LinkedIn profile Beautiful. But I mean, yeah, what I'll do is I'll email and send over some links to just things that I think are, you know, a good starting point for people to get interested in this. Maybe a couple of books as well that I think are worth a read yeah, do it.

Speaker 1: 1:27:13

Send me a link. Send me a link and I'll put it into the show notes and I'll put your contact details in there.