The issue of promises made and kept is important in all areas of business. For example, when a company claims that its widget does X, consumers expect it to actually do X. If it doesn’t, the company will have a big problem on its hands.
Take the financial services industry. Although at a macro level this industry has a good record of keeping its promises, individual advisors sometimes make promises they have no business making. A classic case is when they project unrealistic or deceptive performance results. Recently, Business Week shined a spotlight on what it calls “401(k) predators.” These advisors put on seminars for corporate employees on how to retire early using their existing 401(k) savings. Problem is, to lure clients, they project unrealistic investment returns (14% in one case) and promote aggressive withdrawals from 401(k) accounts. Can’t you just see the approaching train wreck?
We can never understand why advisors use unrealistic projections. Since investment asset classes all have a range of reasonable and expected results, which most clients accept, why jeopardize your business by projecting results that teeter on the leading (bleeding?) edge of the bell curve?
Another type of broken promise is when advisors fail to follow through on commitments made as a financial professional. These are the promises contained in the National Ethics Association Ethics Pledge . . . things such as doing comprehensive fact-finding before recommending a solution, fully disclosing their background and product details, and providing ongoing service reviews.
Not following through on these fundamentals can be as damaging as hyping results. That’s because clients feel let down when their advisor says one thing during the sales process and behaves differently afterward. This disconnect, much like a politician’s broken promises, generates ill will—and encourages client defections. In extreme cases, they can even produce lawsuits and errors-and-omissions insurance claims.
Bottom line, keeping promises is fundamental to your business success. Here are some techniques that can keep you safe:
- Never promise something you can’t fulfill.
- Always under promise and over deliver.
- View your client promises as a sacred trust.
- Get better organized so you don’t forget the promises you made.
If you can do these basic things, you will develop a reputation for being a businessperson of integrity . . . someone whose word outlives the average political promise and who will rarely, if ever, see the inside of a courtroom.