Improving Investor Behavior: Reframing your business mindset

For business owners, improving investor behavior can mean more than a focus solely on financial instruments. The intent of this column has been improving investor behavior, which often discusses market investments like equities, bonds, and other financial assets. But it’s important to consider how our investor behavior applies to other critical areas of our lives, namely in the ownership and running of a business.

As an independent financial adviser, I’m in a unique spot. I own a business and am responsible for running that business while helping my clients think about running theirs. I have a dual perspective, both as an advisor and as a business owner. So this week, I want to cross over into the business world and encourage you to consider how your investment behavior (i.e., the beliefs and attitudes you have about your business) and possibly the most valuable asset you have, your employees, might be affecting your results.

Mid-March, I was faced with the same decision that many other business owners were. With the economy and society locking down around us, what were we going to do? Many in our firm, and people on my immediate team, were among the high-risk population.

The two parts of our business, which I like to refer to as our “frontstage” (meeting with clients, presentations, events) and “backstage” (everything that has to happen to make sure our frontstage looks beautiful and performs flawlessly) had unique challenges in working remotely. For our local clientele, meeting face-to-face would be impossible, not only for our safety but also for theirs. Our out-of-town clients were more accustomed to Zoom meetings, which we have been holding since 2014. On the backend, we are in a highly regulated industry meaning many of the tools for cloud storage and remote working, enjoyed by other businesses, have barriers.

Furthermore, my disposition was what my team would call “old-school.” It was always important that my staff be in the office working, connecting, and serving clients. Even after working with a business coach for the better part of 20 years, who persistently encouraged me to reconsider my “time and effort” mentality in favor of one based on “results,” I stuck with what I knew. Behavior is a difficult thing to change, and I am no exception. My mindset needed to change.

So here we are in mid-March with a choice I had to make. Weighing the risks for our team and clients, we shifted to operating remotely. The grand experiment had begun. Would we be able to serve our clients with the same attention to detail and responsiveness for which we’re known? Would our clients, some of whom are unfamiliar with online video meetings and presentations (especially as market volatility peaked), adapt? Heck, how would I access files remotely that we are accustomed to accessing in the office?

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Like many business owners and investors, these fears proved to be largely in my head. As the month progressed, my team quickly found solutions and implemented them. When you get out of the way and let your team work, magic happens. Using tools like Microsoft 365 and Zoom, we were not only able to keep our backstage running smoothly, but improve our frontstage, offering clients the ability to connect with us and have their questions answered at an incredible speed. This was all while keeping everyone safe and healthy. We were even able to host a client event, giving them the opportunity to come by a restaurant and pick up a to-go meal while we accepted donations to a local food bank for those in need, all without them getting out of their car.

Like everyone, the COVID challenge forced us, forced me, to innovate and adapt my behavior and change my mindset. When we go to renew our lease in a couple of years, we may reduce our space, ultimately improving our bottom line. Team members and partners traded their 30-minute commute for a 30-second commute.

They are more productive, healthier and happier. They can have lunch with their spouse and family. These benefits were obfuscated because of a blind spot I had that my team needed to be in the office to serve our clients best. Think about your thinking. What is your mindset? Are you a “time and effort” or a “results” oriented owner?

Our story has a happy ending, but that’s not the case for many businesses. Restaurants can’t serve food over Zoom, and it’s hard to be an onsite travel guide from your couch. But for the business owners who are still trying to make it work, I’d encourage you to examine your beliefs, behavior and mindset. What innovations are lying just out of reach?

Remember, your team members are the frontline with your clients and customers; encourage them, listen to what they have to say. Look at what you do; re-think your product or service. Be open to new ideas. This attitude shift was once a luxury, a “let me think about that.” COVID has made it a necessity. Those business owners fortunate enough to have the ability and agility to respond have an opportunity to reconsider how they do business, and hopefully innovate their way to a better future for their staff and clients.

What is your mindset? Have you thought about your thinking?

Steve Booren is the founder of Prosperion Financial Advisors in Greenwood Village. He is the author of “Intelligent Investing: Your Guide to a Growing Retirement Income,” published in March 2019.

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