Advising Clients Ethically

Whether you call yourself an advisor or consultant (or not), David has seven core ethical principles that should govern advisory work.

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"Advising Clients Ethically" article on Punctuation.com

Transcript

Blair: We're back, David. Did you miss me?

David: [chuckles] I had the happiest month of my life, it was so great, except for when you texted me.

Blair: The listener doesn't know because the episodes kept dropping, but Blair disappeared for a month.

David: Yes. I missed it, because even if we didn't regularly talk to each other as friends, this is always the excuse to catch up.

Blair: We've already chewed up 30 minutes of the podcast time just catching up, so this is going to be a short episode, people. The topic today, David's topic, is advising ethically. You stole my topic. I wanted to do one on advising clients unethically. Fine, we'll do it your way.

David: Like our proposal episode.

[laughter]

David: Oh yes, advising clients ethically. You notice what I chose in the title, I didn't say consulting clients ethically.

Blair: Why is that?

David: I don't think people would believe that it applies to them.

Blair: You don't think there's such a thing as ethical consulting? Is that your point?

[laughter]

David: That's not what I meant. There's this, I think probably deserved reputation for consultants, and people tell jokes about consultants, and I love those jokes, too. They don't want to think of themselves as consultants because of that sort of dirty laundry about them. They'll sometimes call themselves advisors because advisors doesn't have the same sort of dirty, dark alley feel as consultants. If I use one word or the other, I see a different reaction.

Blair: I've noticed that you use the word advisor in place of where I would use consulting. I don't have the dirty reaction to consulting.

David: Yes, I guess part of this issue too is that I want listeners to honestly believe that they are advisors, or if they're a little more mature consultants, they're advisors. I don't want that to surprise anybody. Whoever you are listening to this, and if you've listened to this podcast regularly, you are an advisor, whether you think of yourself as one or not. I have fantastic admiration for this, because when I think of advisors, I think of standing in front of a room, convincing people who are skeptical, and you have nothing tactile to hide behind.

You're almost standing naked in front of them metaphorically and trying to get them to think differently. That kind of skill is amazing. I had some very different, very physical, dangerous jobs in my early life. One was reading meters in the bad section of town because I was a low guy in the totem pole. I got the bad sections of town where they would chain their dogs up to the gas meter, so I couldn't get to it or working in a foundry one time.

The people, not me, but the people that had been there a long time, they're very, very skilled. They're very, very smart, but they're not taking the same kind of risk of standing naked in front of a room of 20 people. Didn't you tell me one time you did that when you were in your 20s?

Blair: [laughs] Oh, sorry, I wasn't supposed to tell that story.

David: It's a story, or people are going to fill it in for themselves, man.

Blair: Yes, whatever. You're talking about you landed in the wrong airport. I said, my first business flight in my career, I got on a plane to the wrong city back in the day when airlines would let that happen. Then I was in a room full of 20 people, but that was when I got on the plane to the right city.

David: Okay. You were in your 20s, you're by yourself, nobody else from the agency is there, and you're making a presentation to them. Were you nervous back then?

Blair: Yes, and it was silly because it was to city government. The mayor was in the room, and then 20, 30 other people, I didn't know what they did. The receptionist was in the room, it was like everybody who worked for this medium-sized city in Canada was in this room, and here's 22-year-old Blair doing a pitch by himself after having flown to the wrong city initially. Anyway, we are digressing. We can come back to that.

David: Okay. If we run out of stuff, we'll come back to that.

Blair: [laughs] Yes. You have admiration for our audience, for these advisors, but there's this issue of ethics and why do you feel like we need to bring up how to do this ethically?

David: The odd thing is we don't really have any training in consulting. There's no course like that, right? There's business school and so on.

Blair: I think there's probably 200 courses at $29 each available online.

David: Oh, right. Yes, I'm not talking about those. I'm talking about how to deliver expertise. There just aren't that many real courses around that. The focus is on developing the expertise. We just pick things up. It's often an extension of who we are. Who we are is how we show up, at least that's the way it should be. We worked for somebody and learned a lot from them, and some of it was really good, and some of it wasn't all that good. I don't know that we talk enough about the ethics of advising.

I guess you could apply this to selling too or whatever, but I'm thinking more about, "Okay, the client's already in place, and you are advising them." I call this the first room stuff before you start all the implementation that follows. What are the principles that you would follow to be an ethical advisor? I'm not pretending that these are the only ones. They're just the ones that come to my mind.

Blair: All right. You have a list of seven core principles of advising clients ethically. The first one, you start with don't over-promise. That seems like a pretty safe place to start.

David: Because we all do it.

Blair: Do you think so? Do you think it's endemic?

David: I think over-promising is on a sliding chronological scale.

Blair: You over-promise early in your career, is your point?

David: Yes, exactly. In fact, every one of us remembers at least one instance where we make some promise. Maybe you were in person in a sales meeting, and you make some promise to drag the client across the finish line, and you get back in your car, and you get on your mobile phone, you call somebody back in the office and say, "You will not believe what I just said we could do."

Blair: [laughter]

David: That's over-promising. You do a lot more of it at the beginning than you do later. I think some of that is fine, but I don't know how long you should be able to do that. It should drop, drop, drop. I would think after four or five years or something, you're not over-promising at all. That's the source of a lot of your credibility. Don't over-promise.

Blair: At some point, you're the sage, the wise old sage, and you're managing expectations rather than trying to get people excited.

David: Yes, because you remember how empty it feels to not meet someone's expectations. You just want to set those appropriately.

Blair: Yes. Second on your list is to listen. You have listened and then sort. What do you mean by that?

David: Yes, because I wanted to make a big distinction between the really appropriate concept you talk about a lot, that you're either presenting, or you're present. We need to stop talking and all of that, and we've had a number of episodes about that that have been fantastic. Here I want to highlight something different. You obviously can't sort unless you listen, but the focus is on sorting. The client comes to you, they're already a client, and this is a new project or something, and they just start explaining what it is they need or what they think the issue is and so on.

Your job is to absorb all of that, make sure that nothing gets said that you can't recall later. Mainly you're sorting, deciding which of the symptoms they're trying to solve are really relevant. It's very much like when you go to a fantastic physician, you're sitting there, she's asking you questions, and you're telling her all of the things that you think are symptoms. She's not doing this in a way that you would notice because it would seem disrespectful, but in her head, she's saying, "No, no, no, oh yes, that, that right there. No, yes, that one too."

As every symptom that you roll off your tongue comes out, she says, "This is what we ignore, this is what we work on." While listening is a really, really critical score, I think there are a lot of advisors who aren't all that good at sorting. They give equal weight to what clients say. Ideally, the client would just make one sentence, and then they would only be allowed to answer your questions, but that's just not the way the world works. Because most of the time it's a 30-minute conversation. You knew exactly what was needed and how to answer this 2.5 minutes in, but you have to listen for the rest of the 27.5. Anyway, it's the skill of sorting that I wanted to call attention to.

Blair: What's important to pay attention to and what's not. You're the metaphor king. Your metaphor, it's like a breaststroke in the water around Manhattan.

David: Right, where you're pussying irrelevant stuff out of the way.

Blair: Yes. Your mind isn't drifting. You are keenly aware of everything that is happening around you and discerning what's important and what's not. After listen and sort, you've got another take on listening. Listen for a long time.

David: Right. Which is related, right? That's part of what it means to listen is to keep resisting the urge to talk, which we talked a lot about when I interviewed you on a recent episode.

Blair: About not talking.

David: About not talking. Where, I don't know, you talked almost the whole time. On this one, I want to draw attention to something else, too. Just like before, yes, you listen obviously, but it's really about sorting. Here you listen for a long time, but as soon as you are fairly confident that you have the right thing to say next, don't blurt it out but try to turn that around with questions or different sort of expiration paths. Get the client to come to that conclusion before you do. Again, I don't want to pretend that these are the seven magical things.

They're just things that I think set you apart as an expert advisor in your work versus one that isn't. It's listening, and I think of this one as holding an inner tube underwater. The minute you let go, it just spurts right to the top and splashes everybody. That's what it's like when you're trying not to talk, and you finally let yourself talk. You let the inner tube fly up into the air. Well, just hold it a little bit longer and see if you can redirect the conversation so that they come to the conclusion on their own before you just blurt it out to them. That's this one.

Blair: All right, you're two for two on excellent metaphors here. The topic is advising clients ethically. You have seven core principles. The first is don't over-promise. The second is listen and sort. The third is listen for a long time. The fourth is acknowledge what you don't know.

David: Yes, this is different than don't over-promise because over-promising relates to what you're going to do. Here I want to talk about what you don't know. I really just want to give you one little way to think about this. One of the reasons your clients hire you is because of your external objectivity. They feel like they're just too close to the problem, and they want somebody else just to take a fresh look at things and see if they can see something that may be staring them right in the face, or maybe they see all these things, but they don't know how to prioritize or what banner to hang everything under or whatever.

That's one of the reasons they hire you. You come in mentally prepared to be the expert like you should, but you have to live with this friction. I think it's a real friction that we should not be embarrassed about, but we naturally are. That friction is being so externally objective that you can't ever be expected to know everything about the firm. As you make safe assertions along the way, you have to expect to be wrong because you don't have all the information to correct yourself, and if you did, you wouldn't be an external objective advisor.

It's in the very essence of being external. The very essence of that means you're going to be wrong sometimes, and you have to live with that. When that happens, just admit it and say, "Oh, yes, one of the disadvantages of being on the outside. That's how I saw it, but I see what you're saying." That's the point here.

Blair: It's not only what you don't know, but what you got wrong. In addition to being wrong, I think there's also this idea of surprise. Sometimes as an expert, you feel like you've seen it all, "I know all the patterns," but if you really do have an objective outside take, then this idea that information is surprise. You tell me if you put this in the same category of what you don't know. I'll just try this on myself. Sometimes as an outside advisor, I get really complacent.

"I've seen it all. I've seen all the patterns There's nothing that you're going to say that's going to surprise me." Then when I see or hear something for the first time, I'm actually thrown back. I've never thought of it. This is new. This is the first time I've experienced it. I think my natural inclination is just to cover up that surprise. Tell me if I'm reading this right, but I should put that on the table. I haven't heard that before. That's interesting. You've thrown me with that one. This is new.

David: Right. They want to pick up from your comments that this is a really unique specific application and that you're actually open to learning something. One way to think about it is, okay, I bring the same tool chest to every engagement, and there's never a time when I don't have a tool that I need, but the tools get used in very unique combinations, and sometimes those combinations bring a new realization to me that's really refreshing.

Sometimes even if you find that you have a client who disagrees with you a lot, you can turn that around and say, "I want to admit here. You might be right." Also what strikes me is that this is the first time I think I've ever seen that. That doesn't come across as defensive, but it also opens the gate to a slightly different perspective

Blair: I think in my mind, it leads to a related issue as well. Every once in a while, maybe fairly commonly, you as an advisor will hear from a prospective client in a sales call. It's like "No, no, you don't understand. We're different." You're thinking, "Aah, yes, you're different like the 300 other firms exactly like yours I've worked with in the last two years," or whatever it goes through your head. I'm not admitting that these horrible thoughts go through my head.

David: Please don't confess on my behalf. I'm okay with [crosstalk]

Blair: They think, "Now I really need to dig deeper because we're different," and you're rolling it as an advisor. You're rolling your eyes. You're not that different. I can see from the outside you're not that different. In a moment where you realize, "Oh, you actually are different." It's probably reassuring to the client for you to say, "Oh, yes, what? This is different. You are a unique case." Because I think everybody wants to believe that they are different.

If the advisor sees them as different, sees their situation as unique, while there is some comfort in the fact that, yes, I've seen this problem before, if they firmly believe that this is a unique situation, and you can't have possibly seen it before, I think there's probably some comfort in you admitting, "Hmm, that's interesting. Really have not seen this type of rash before. You are different."

David: Right. You went right to the doctor thing. It surprised me. How many clients do you talk about their rashes with? If I've been doing this for 30 years, am I a better advisor now than I was then? Well, I hope. Okay, well, how did I become better? It wasn't just from reading. It was from getting corrected in slow ways, nudged into a deeper path, right? When those moments happen, admit it, become human, and you'll get a lot more credibility about being right when you do admit that you're wrong too, like we talked about earlier.

Blair: Principle Number 5, it's not a contest. What do you mean by that? Not a contest between who for what?

David: Advisors by definition, I think, are confident. If you're not, then you're just not a good advisor. It's just nobody's going to listen to you. You're not used to being wrong or corrected. You think of yourself as a leader. Then somebody says something that would imply either a mild or even worse, a strong disagreement. Immediately, you feel that reaction rising inside you. That's a defensive reaction that helps nobody. If you win this contest where one of your clients is disagreeing with you, well, how does you winning help them? Because you're not going to convince them.

Your outlook should always be, "Hey, listen, in this engagement, let's always look for the truth, wherever it comes from." There will be times when maybe I didn't see something correctly or whatever, and I expect you to tell me, but it's about not winning, it's about finding the truth and being open to learning all the time. I have a huge problem with this. If there's one of these seven that I have to work on the most, it would definitely be this one.

Blair: That's humility. As you're talking about it, I'm thinking of specific scenarios where I've gotten into trouble over this, thinking it's like, I'm going to overpower the client with my correct observation or understanding of the situation. You talk about the sliding scale over time. I suspect there's this sliding scale where early on it's easier to be humble because you're keenly aware of what you don't know, and later on, it becomes harder to not make it a contest to show up with some humility and vulnerability.

David: Oh, good point. Yes, it's so obvious you're wrong in the early days. There's nothing you can do about it.

[laughter]

Blair: Statistically, you're probably wrong on almost everything. All right, moving along in our Seven Core Principles of Advising Clients Ethically, we've done five. Number six is recognize the client's valuable role. What, the client has a role in these engagements?

David: Yes, I know. The first thing I thought of when I wrote this was your comment about you're not a partner with your client. Is that how you say it? I don't remember.

Blair: Yes, you don't partner with your clients.

David: Right. I wasn't trying to address that sort of an issue. I was talking more about how you can't see yourself as a white knight. You need to see yourself as one of the two parties that's going to solve this. I hear people say, and I just cringe, it's like, "We're going to know more about your business than you do." It's like, "What? That's bullshit."

Blair: Yes.

David: It just sounds so arrogant, and it's just not true in anybody's world. What might be true, or at least this is something that you could strive for, you wouldn't necessarily have to say this unless you were asked, or it came up naturally, but you might strive to be the outside advisor that knows their firm better than any other outside advisor. That's a worthy goal. In accomplishing great things together, you are going to have to bring three things to the table.

That external objectivity we talked about a minute ago. Second, seeing the patterns, because you've seen the inside of 60 firms like theirs, and this is only their second job in the industry, so it's 2 to 60. Third, the courage to speak the truth in an appropriate sort of human way, because a lot of the things that you're going to say when you're working with clients are not new news. It's like most everybody knows it except for the person that needs to know it, and the people who do know it just don't have the courage to jeopardize their jobs, and I understand that.

You're speaking that truth courageously inside. You're doing those three things, but they are bringing deep expertise in this company's history, knowing the politics that operate within this organization, knowing what they've tried and failed at before you step on something. Anyway, I just think it's really useful to view the client's valuable role and to acknowledge it.

Blair: The trade-offs the client has to make in deciding to take or implement your advice, it reminds me of guidance that I give to our clients as a rationale for putting forward multiple options in a proposal. That is, even if you're the best salesperson in the world, the likelihood that you have uncovered all of the trade-offs that this person needs to make in the decision to hire you or engage you or accept your proposal, it's very, very low. You just have to assume. There's a bunch of stuff about the business and this person's role in the business and their history and what they're worried about that you haven't uncovered.

You just have to respect that. Again, back to this idea of humility, the client's bringing all of this knowledge about what's going on, and some of it's getting in the way and your job as the observer is to just put it aside and say, "Well, this isn't important, but let's just put this over here." There's the depth of experience and the reality of the client's situation that you probably can appreciate as an advisor.

David: Yes. You're only going to pick that up by listening carefully, too.

Blair: Yes. All right. What's the last one on our list here?

David: This is my superpower is empathy.

[laughter]

David: I can't even say it with a straight face. Be empathetic about courage that they will require to make these changes. It's so easy for you to make these pronouncements about what they should do, and you're probably correct, and you're also probably courageous in saying it, but you know how easy it is for you to do that compared with how easy it is for them to do what you're recommending, whatever that is. Pair this with what I said just a minute ago, they often know what needs to be done. You sometimes are not telling them all that much new information. You're giving them the courage to act on it and maybe some support and some clarity and so on.

They haven't lacked primarily information, which is what you think you're selling. They've lacked the courage to do it, and you can help. It does not stop just with the right advice. It has to be wrapped in change management too or nothing changes except what's in their brain. I feel like as advisors, we over-index to just telling the truth rather than helping them see how this is going to work. Personally, I don't have the patience to be in change management, but I have a deep respect for that field, and it starts by being empathetic so that they are not going to fight your recommendation.

Blair: Yes, that's a good one. All right. We're talking about seven core principles of advising clients ethically. Number 1, don't over-promise. Number 2, listen and sort. Number 3, listen for a long time. Number 4, acknowledge what you don't know. Number 5, it's not a contest. Number 6, recognize the client's valuable role. Number 7, be empathetic about courage they will require. Do you have any parting words of advice for people thinking about these core principles or measuring whether or not they're currently putting them into practice?

David: Yes, I think advising is a great opportunity to learn about yourself. I didn't learn a lot about myself working on the hotline at a foundry or our Donnelly's running the catalog trimming machine or reading gas meters. I didn't learn a lot about myself, but I learned a lot about myself advising because I can see the reactions, and I can say later, "Why did that happen, David? What's going on here?" It's just a constant refinement of who you are. It's a great field to be in because it rewards the best humans who are outward-looking and know how to conduct themselves, and I don't know, that's it. That's all I got to say, but I love the field.

Blair: That's a great place to end. Thank you, David.

David: Thank you, Blair.