Emotional Intelligence: The “Untouchable” Differentiator in an AI World

Speaker A: Foreign. Welcome to the latest episode of our podcast series for financial advisors. Today's episode is Emotional Intelligence, the Untouchable Differentiator in an AI World. It's a conversation with James Woodfall, communication and behavior specialist from Raise youe ei. I'm Mindy diamond and this is the Diamond Podcast for financial advisors. At, uh Diamond Consultants, we help elite advisors identify the right environment for their businesses to thrive, whether that's at a wirehouse, boutique or independent firm. With nearly three decades of experience, we've guided thousands of advisors and represented more than a quarter of a trillion dollars in assets transitioned and each year one in four advisors managing a billion dollars or more. Who change Firms are our clients. Our process is education driven and based on building relationships, starting as your strategic partner. Well before you're even thinking of a move to schedule a confidential conversation, call us at 908-879-1002. Wondering why advisors change firms and where they're headed? Our transition, going up or down? Those very questions and more inspired us to create our annual Advisor Transition Report. It's the award winning data driven resource designed for advisors that connects the dots between the motivations around movement and the firm's appetite for top talent. Arm yourself with the knowledge you need to make smart decisions. Download your copy@diamond-consultants.com transitionreport. For years, advisors have competed on expertise. The, uh, ability to solve problems, deliver answers, and provide guidance clients couldn't easily find on their own. But today, those answers are becoming easier to access. Via artificial intelligence and tools like ChatGPT, Claude and Perplexity, AI can generate planning ideas, summarize complex topics, and answer questions in seconds. As the technology continues to improve, it raises an important question. If information becomes increasingly commoditized, what will clients continue to value most? My guest today, James Woodfall, is the founder of the training firm Raise youe AI and a former wealth management business owner. James now helps advisors, leaders and organizations strengthen the communication and behavioral skills that drive trust, influence and performance skills rooted in emotional intelligence, or ei, something that AI cannot authentically replicate. What's interesting about James's perspective is that he doesn't view emotional intelligence as a soft skill. He views it as a business skill, one that impacts how advisors build rapport, earn referrals, lead teams, deepen client relationships, and ultimately differentiate themselves in an increasingly competitive marketplace that includes human and machine driven advice. Our conversation explores why rapport is the foundation of trust, how emotional intelligence can be developed like any other professional skill, and why advisors who learn to create authentic human connection and may be best positioned to thrive alongside AI, not compete against it, or as James puts it, remain untouchable in the face of a changing world. Because while technology may continue to reshape how advice is delivered, the experience of being understood, trusted and guided by another human being remains remarkably difficult to replicate. So let's get to it. James, thank you for joining me today, especially coming all the way from the uk. I'm grateful.

Speaker B: Thanks for having me on.

Speaker A: So let's start at the beginning. You're a different kind of guest for us and a topic that is near and dear to my heart because I'm always all about emotional intelligence and eq. But it's a topic that sometimes can feel a little squishy to some folks. So tell us a little bit about your background and really how you got into the world of wealth management.

Speaker B: I got into wealth management, probably worse by accident. When I was, I think about 19 years old, I got a job in a bank because I was living with a different job. So it was the first company that would take me. So I ended uh, up working in a bank as a, as a cashier in a branch. And then after sort of a series of different career moves, I ended up running my own wealth management firm for about nine years, which I sold about three and a half years ago. Around the time that I was selling it, I did my first master's degree in communication and behavior analysis. And that's when I started sort of taking a bit of a deep dive into understanding emotional intelligence and behavior and communication. But really the I, uh, started that journey before I sold my wealth management company. And really the goal was how can I become a better financial advisor to my clients by having a better understanding of their psychology, behavior around money so that I could communicate with them more effectively, help them build better plans. So I had a bit of a, uh, like a lot of people I speak to in wealth management, they fell into it.

Speaker A: So a lot to unpack there. And I'm fascinated by your story. Tell us a little bit about how you began to use or leverage emotional intelligence. You say you got into it and were fascinated by it because it was a way of helping your clients. So talk to us a little bit about that. How did you begin to see the impact long before you started this business?

Speaker B: To go back a couple of steps to ah, that the. When I started the business it was very transactional. You'd sit down with a client, you sort of find out about what sort of assets they have, what type of plans they have. Already and you look for kind of gaps where you could optimize things or there's a product which they need, which didn't have. But I moved kind of away from that type of service to a financial planning LED service. So where actually before we get talking about, well, how do we, how do we structure your world? We spent a lot of time building a plan in cashflow modeling software. So the one that I used was run by a company called Voyant. And essentially I built a cashflow, a cash flow plan for the clients which would map out kind of based on assumptions, what age they would reach financial independence, and then that then would then move on to, well, how do we optimize your holdings? Now, what occurred to me pretty quickly in offering that service is that the outputs from that type of exercise are only ever as good as the inputs. So you're really relying on the client to be able to come up with the answers to the questions that you ask them to make the financial plan work. And, um, in my experience, quite a lot of the time you sit down with these people and you ask them, imagine you're retired. You know, what does an ideal week look like for you? So what I realized is actually I was asking clients a lot of questions which no one had ever asked them before, such as, if you're going to retire, imagine you retired tomorrow. What does your ideal week look like? Very rarely did we go. We get asked that day to day, especially not from friends, you know, family members certainly. So I went off and actually did a diploma in coaching. So I thought initially, I want to become better at actually getting people to think about the future and think about plans. And in doing that, I kind of ended up wanting to take a bit of a deeper dive into understanding behavior at a higher level. So that led me on to say, doing a Master's impacts on clients, though, is that I recap and must, and me as well, is that I became a far better listener first. So I stopped, I listened first, I stopped making so many assumptions, as I found I had about people. And really, I think that changed the dynamic in terms of me constant, I suppose, dictating to people about what they should be doing. Because of course, that's what a good advisor does, isn't it? It's advice. You switch around into actually getting. Making sure you've got a deep understanding of people's hopes, fears, you know, goals, dreams. And then ultimately you can help them better in terms of optimizing their financial plans and wealth.

Speaker A: Yeah, a hundred percent of what you just said. Speaks to me in a big way because that is 100% our philosophy. Most recruiters, I don't mean it disparagingly, but most recruiters in general are pretty transactional. They see a hammer, they see a nail. So a recruiter sees a financial advisor, and he's a means to an end, to, uh, making a deal, to a transaction. And our whole approach from day one was never about seeing you financial advisor as a transaction, but rather, first and foremost, wanting to understand what's important to you. And we get told all the time that we were asking questions that nobody ever asked them before. And I want to hear, I want to unpack it more because I love what you're saying. The goal, as far as I see it, is not just to ask a bunch of questions nobody asked before, but it's to ask questions as a means to an end. To start out by asking questions that make somebody comfortable, that tell them that you care about them. Then it's about asking questions that they've never been asked before. Because the answers to a question like, how do you see yourself behaving in retirement? Has everything to do with how much money they'll need to retire. So one informs the other. In our world, asking somebody, what are the things that spark you and what are the things that really don't, and what will you do with this information? And all those sorts of questions are questions many people had never been asked before, especially if somebody was looking at them as a transaction. And yet it's what deepens relationships. It's what creates trust, and it's what allows you to identify me as a recruiter, identify the best solution or the best opportunity for someone. So do you agree with that? Is there anything that's. That I'm off about? No.

Speaker B: M. That's exactly the point. I think I'm asking better questions as a wealth manager, talking to your client, because ultimately this is, I suppose, one of the things which comes from understanding emotional intelligence is that for most of us, we make decisions, emotion first, and then we justify with logic and reasoning and which is basically back to front. You know, advisors start with logical reasoning and then expect people to make a buying decision. And so a lot of the time, especially with things like retirement savings, for example, because it's so far, because it's in the future, it's over there. First year is 10, 20 years away. People think, oh, why would I give up so much money a month now for something which is so far in the future that I can't comprehend it yet? But if you Start framing the questions in a way which gets to kind of the. You really. What you want to uncover is if you wake up at three in the morning and you can't get back to sleep, what's on your mind? Because if you can uncover that emotion that sits all that kind of pain or problem, then you deal with emotion first, logic second.

Speaker A: And it tells you what you need to solve for. Right. If slowness does. What keeps me up is I'm worried I'm going to outlive my money. And you know, that's your true north in terms of how you begin to tackle that. They're thinking about the future. They want you to focus on the long term. Right. Is that sort of what you get from that? What's the typical answer you get to that question? That one in particular for retirement planning,

Speaker B: it's usually clusters around. I'm not sure I'm making the right decision. There's lots of options and they're complicated. But really, actually, am I going to have enough money? Am I going to run out? Because it's there. Um, it's the big question, isn't it? How long are you going to live and how much. How much are you going to need?

Speaker A: Right. As I was preparing for this interview, I think I know the answer because I'm a person that lives in this world that believes fully in. I don't have a degree in behavioral finance, but I'm big on emotional intelligence, connecting, developing trust and that I don't have any right to sell anybody anything or suggest anything unless I've connected on an interpersonal level. But I don't know that everybody believes that. So help us, our listeners, to understand why does this matter to financial advisors? So if I'm. I'm going to give you two examples. I'm a younger advisor that has, say, five to 10 years in the business, say $100 million or £100 million under management and is looking to really build a business. How and why does the concept of emotional intelligence of EQ matter to me? And then I'm going to ask you the same question again with respect to someone who manages a billion dollars or a billion pounds, how and why does it matter?

Speaker B: Yeah, I think probably the starting point is let's just clear up, I suppose, some definitions so that we kind of understand what we're talking about. When we say emission terms, it's an EQ because I suppose, let's think of it M. Let's call EQ the measurement and emotional intelligence is the concept. So the definition of emotional Intelligence is, it's an ability and uh, it's this ability to understand and influence emotions in ourselves and others. So within ourselves, can we, can we perceive and understand our own emotions? You know, what turns them on, you know, what triggers them? You know, can we, can we do something about that? Can we recognize it, manage it in the right context? You know, either initiate, you know, ratios in the right context? And can we do that when we're talking to other people? So are we good at perceiving people's emotions within different contexts? And are we good at influencing and utilizing that information to help us communicate more effectively? So these are skills which you require, which requires, you know, regard within those two roles to m to make you effective. So one of the things that we've Learned from probably 30 years of people studying emotional intelligence is that if emotion is involved within the job role, emotional intelligence correlates with job performance and has a meaningful impact on the difference between an average and a big performer. So regardless of whether it's one of the two scenarios that you've said, performance improvements are always on the table. But one of the things which tends to happen as you kind of move from sort of, say, up in terms of money that you're managing is the stakes get higher. So quite often you actually need a much, far higher degree of self management, you know, a higher degree of self awareness, a higher degree of ability to perceive emotions in others and to be able to communicate with influence. Because quite often as you are dealing with as well, clients who are more affluent, there's a correlation between actually the skills that your clients have and the skills that they expect you to have as an advisor. So higher you kind of go up that sort of ladder in terms of value, the more effective you need to be. So that's where that sort of cue measurement, if you had to sit down and do an EQ assessment, for example, you need to be scoring way above average the higher up you get.

Speaker A: How will somebody begin to notice that? Developing the emotional intelligence muscle, developing the quantity of eq, how will that begin to show up and impact their business?

Speaker B: There's a couple of ways. And I think it really does show up in self awareness and self management and awareness and understanding of others. So one of the things which will show up in terms of that awareness and understanding of others is can you build trusted relationships quickly? So like those skills that we were talking about before about asking better questions and listening, especially the first, you know, first time you meet a new prospective clone, if you can really turn your ears on and get very, very curious about the person that you're talking to. Rapport building is one of the foundational things for trust building. If you get rapport building right, one of the goals should be to find common ground early. Because the minute that you can build a connection with people and you start uncovering things that you've got in common, it kind of starts signaling to people that actually you're someone who is like them on their side and that they're someone that you can trust. Now, people who get this right, they tend to close more clients and they tend to gain more referrals or recommendations to other clients. And when I used to run my business, referrals was the largest source of new clients every single year. All the other different marketing streams, they didn't produce anything near referrals. And I think back to, if you look back to the kind of retirement example, if you can really get an answer to that question of, you wake up at 3:00am, um, what's on your mind? What's the you know, what stuff? And you getting back to sleep, if you can uncover that and solve that for a client, it's far easier to articulate that to a friend than it is for them to kind of explain the technicalities of what you did with their retirement teams. But it's easier to articulate. You should absolutely go and see James. You know, we were worried about whether we're saving an hour if he solved. That is brilliant. You know, you need to go and see him. That's what I mean is that they're able to articulate the emotional outcome.

Speaker A: Even though what we're talking about here is someone making the case that strengthening one's emotional intelligence will make you a better advisor, easier to say. That sounds logical, but you're connecting it to. You're saying that someone who actually gets this right, gets it better, is going to create more of an instant rapport rooted in trust and likely grow their business because it makes them more referable. And those are things that certainly every young advisor wants, but every advisor wants. So let me switch the tables a second. I get why a young advisor with a hundred million who wants to get to a billion, why this is really important. They want to do everything they can to really make themselves the most referable. But let's take the advisor that's on the back nine that has been doing this 30 years, manages a billion and a half of pounds, dollars in assets under management, is growing by referrals. And it's an organic referral stream. Like it's A business that feeds itself. So while everybody always needs to be in business development mode, they feel like they've cracked the code, they've got it covered. How and why does this concept impact a senior advisor, someone with a much bigger, more robust book of business?

Speaker B: Yeah, it's interesting. So if we take a bit of a step back and um, look at kind of a bit about what some of the research says about the impacts of emotional intelligence. There have been some studies done within financial services about the impact of uh, AI training on business outcomes. So there was a study done probably around about between sort of 2000, 2004 with Ameriprise and they put their agents through a year long emotional intelligence development program. And it was interesting, they measured at the beginning of the program eq, so what some of the EQ score was. But they measure things like health, you know, anger, trait anger. So were people how people experience anger, stress and burnout. So they're measuring all sorts of things other than EQ just to see what the impact of EQ training was. Now EQ scores went up, sales went up, I think on average of about 24% across four cohorts. But things like stress, burnout, uh, health outcomes, perceived health outcomes, you know, people are asked to rate, how do you rate your health? You know, that went up angle experience of anger went down as people become better at managing it. So as you look at the kind of example that you described, I would sort of say that as kind of someone who's in that stage of the career where they may not have the capacity to take on more clients. So just think, well, actually I don't want an uplift of 20%, 24% in sales because I might not process that. But one of the things which I suppose the kind of AI research shows actually is that it impacts your quality of life. And there is finding which is quite common in research, is that actually scores correlate with age. So as we go through life and we have sort of ups, downs, highs, lows, and we learn from those, we learn from our emotional experience. And that, you know, hypothesis is it feeds into our EQ score. So you've probably got people at that later stage of their kind of career who actually probably have had experience which has developed their emotional intelligence. They've got mature kind of sort of standing, which means that they might not necessarily need to go out and find new clients. They've got experience which, you know, it's kind of help them develop client relationships, but they might want to sort of take a step back at quality of life. You know, if they're experiencing stress, burnout, pressure, EQ can help absolutely do all of those. The other thing which is quite common as well, is that if they're playing any sort of leadership part within that business, now let's say if they're a business owner, EQ absolutely is a, um, is key for leadership performance. So making sure that you've, you're building a team of people around you who can help you develop the business. And actually EI and leadership's one of the biggest areas where, where research has been focused. Yeah, but I think one of the other things we've got to say is that we've all got blind spots. It doesn't matter where we are in, in life. You know, we've all got things that I suppose that we could be better at. And actually shining a lens on those and improving our self awareness is something that you can develop at all stages.

Speaker A: A lot of people in our industry, whether it be a recruiter or an advisor themselves, believe that efficiency or being most effective and efficient is the true north. And that uh, to ask what may feel like unnecessary or ancillary questions that don't directly get to help me to figure out what your asset allocation is so that I can grow your portfolio may feel ancillary. And so is that one of the most common objections you get when somebody say, comes to you and they're uh, thinking about retaining you and they're wondering what the benefit is?

Speaker B: Well, I think people and firms I tend to talk to one of the. There's a couple of common things that are coming to mind now. One is pressure around fees. So how can I make sure I'm articulating my value in a time where clients are more informed? They can go on AI and they can. They come to meetings prepared with answers and they're challenging back around the value that advisors can provide. So getting back, I suppose, and the answer is, funny enough is actually if you've designed your service around kind of a proposition which makes yourself easy to replace by someone else who can do it for the same or cheap price, you know, with the promise of better performance or even in the years coming, you know, a robo advisor, it's going to be challenging to retain and grow clients. But uh, I'm not particularly worried about AI. The other types of firms that come to me is to say, look, we've identified actually that we need to think differently about our business model, what we do and who we serve, because it's going to be easier than it's ever been for clients to come up to do this, some of these things themselves. But absolutely. What is untouchable, I think, is this ability to create a human connection, to sit down and discuss a range of different options. You know, do I do X, do I do Y? What are the trade offs? If I choose that over that, and to uncover those things which, as I said, really keep people up at night and solve for them, I think it's going to be quite hard to replicate that, uh, digitally.

Speaker A: So I want to get to a. And that you hit the nail on the head. And I want to delve deeper into it. What every advisor is looking for. They may not worry about pressure around fees. They may not be kept up at night. They have a practice or a business that's worked for, well all these years and is growing organically, and it's more than good enough. But anybody who isn't concerned about the potential impact of AI on their business and whether they're a financial advisor or recruiter or anybody else is living under a rock. So the goal for everyone should be to make yourself untouchable, and you hit it on the head. It's the ability to create human connection. So I want to ask you something. It occurs to me you talk a lot about learning to ask the right questions. In some cases, the questions that a client never been asked before makes sense to me. But I think the real skill, I mean, I imagine anybody can teach you a list of questions to ask. The real skill comes in is knowing what to do with that information. So let's assume that someone says, an advisor, says you ask that smart question. What keeps you up at night? What do you think about at 3:00am um, pressure around fees. I find people, clients asking me, prospects ask me all the time what sort of value I can add, whether it be in the land of AI or competitively, whatever it is. Pressure on fees, what do you do? So you've asked the smart question, but what do you teach? How will you do with that information?

Speaker B: It's a mindset, I think, because having just say a list of questions, I don't think is really helpful to any advisor when you're trading them. And yet I find I do, I do get people who can say, well, look, uh, what questions should we ask? You know, have you got a list of questions that you would ask? I kind of hold back giving those out because I think that, well, that's what I would say. As you know, it's not necessarily going to land the same way you say it. The Mindset I'm trying to teach advisors is to adopt a kind of a curious mindset. So m not asking questions for questions sake, but if I'm talking to someone, what I want to do is I want to understand how are you thinking? How do you see the problem? What assumptions are you making? What things do you believe which maybe don't line up with how things are in reality or you know, God's objectives or whatever it is. So I'm trying to understand how you think. And that's. That requires not asking questions off a list of great questions to ask comes off of understanding. The format for that is utilizing open questions to gather information, to check assumptions that might sit behind them. Because actually understanding those assumptions is really, really useful. And to then summarize and you know, play back to someone that you're talking to so that you can demonstrate that you're listening and you deeply understand them and being able to sort of summarize and be able to sort of succinctly put their words into kind of a well, what do we do next about

Speaker A: this and why does it matter? I love that because what I always say is it's art, not science. AI could give you a list of. If I put in the topic of emotional intelligence and give me a list of 10 smart questions to ask relative to X, what are the questions I would ask someone from an emotional perspective that demonstrates I have strong emotional perspective relative to pressure around fees. AI could spit out the questions, but I think you're 100% right. The real key is being a good listener, uh, and meeting someone where they are. And it's not about a prescribed or canned list of questions that demonstrate you have strong emotional intelligence. It's much more about asking the right next question, saying the right thing, the validating statement afterwards and, and not as a means to an end, not as a means to a transaction, not as just a way of checking the box. I have emotional intelligence, but really because demonstrating that you deeply care and I like what you said, the notion of a changed mindset. Do people get that right away? I guess what I'm asking is financial advisors, while smart ones who are looking to make themselves untouchable by AI will get that concept. They're looking to differentiate themselves and they're looking to hone the skills that AI can't bring to the table. But at the same time, financial advisors are number oriented and goal oriented. And so how long does it typically take to begin to see or how do you paint the picture about getting from here to there, connecting the dots between strengthening your changing your mindset, strengthening your emotional intelligence, and seeing raw results.

Speaker B: Well, uh, it's about behavior change, isn't it? Like any kind of behavior change, there has to be a few things at play. One is that you have to have kind of a good understanding of where you are right now, what things you're good at, but what things you need to work on. And then effectively, the things you need to work on, you need a plan of how you're going to work on them. So I think commonly how you develop these kind of relational skills is that you need to be able to get close to what does the kind of goal look like? Where am I headed? If I get this right, what's it going to look like? And then you need to kind of have a plan to get from A to B. And actually part of that plan has to be built around good feedback. And I was quite lucky when during my career, I worked for two large banks before I started my firm. And I had really, really good training from managers that I work with almost on a monthly basis, would come and sit in my client meetings and then feedback to me about what I could have done better. And so actually, if you're going to really commit to, uh, developing, I suppose, relational skills and becoming more emotionally intelligent, you need help from someone within your firm or externally to come in and actually observe you by trying out new things and giving you feedback. Now, of course, you could do some of that yourself. You know, if you're doing a virtual meeting, you could hit record, play it back, be your own analyst. But quite often we can't see that ourselves. But if you've got a third party, you know, they can watch you in action quite quickly. They can hone in and say, well, actually, you could have asked a different question here. Or actually, if you'd phrase that like this, you might have got a bit more information or the client closed down when you ask that question. So actually, then you start to create that behavior change. So feedback, I think, is one thing, but actually aligning it with really values, I think. So one of the things that I suppose is quite important for behavior change is that we're motivated to do things when we strongly believe it's the right thing to do. So I think, which is why it can be quite difficult for a firm, um, to bring in with a team of advisors and say, well, we're going to roll out emotion. Sounds like training, because you'll get some, some advice going. This is brilliant.

Speaker A: You know, eye roll, I would imagine eye roll Is the. Can be a lot of the response. Right.

Speaker B: You get a lot of resistance because some people see it as a criticism and just think, well, actually I'm good at that. I don't need trading in that take very much.

Speaker A: And because if efficiency in getting to a goal is the true north, I mean, I think the mindset shift you're talking about is going from believing that, getting to the goal in by just asking the right numbers and dealing in data. Changing that from. It's about building a relationship which ultimately will impact the amount you manage and how you grow and how you connect and all of that stuff. But for people that are goal oriented, linear in their thinking, I imagine this can be not just felt as a criticism, but hard to embrace.

Speaker B: Oh yeah, no, I think we kind of view the brain as kind of a black box. Or do you get people I speak to, they go, you know, mental health isn't real and you know, all of this is psychobabble. But for the people that I've had feedback from, not. And this is even for people I haven't trained. I wrote a book about 18 months ago about the topic which, which talks about kind of emotional intelligence within the finance context. I've had people contact me on LinkedIn and say, look, I read your book, I've been following your content for a while. I've put some of the ideas to work and I'm now getting my, my manager and their manager contact me and say, what are you doing differently? Because all of a sudden they're opening up conversations with clients that they couldn't before, doing business with clients where they couldn't before. And all it is is that this kind of focus on, um, the client, the relationship, building that connection. And all of a sudden you start seeing that, you know, convert into more sales opportunities.

Speaker A: Yes. And more. Yes. Because that's always been our philosophy, my philosophy from starting the business and our philosophy. And I couldn't agree with you more, you articulated it probably as did it. I got to it instinctively. You have research behind it, et cetera. By the way, for our listeners, we will link your book in the notes for this episode. If anybody's interested in buying it. But you hit the nail on the head, so. Or you took the words out of my mouth. In terms of. Next question, who are your clients? Are they individual advisors? Are they independent RIAs? Are they Morgan Stanley and Merrill lynch? And what kind of work do you do for them?

Speaker B: So I do, I do probably. There's probably two parts to our business. One is the kind of Consulting training part, which is going into firms, typically kind of firms that were, you know, the owner marriage, you know, typically, you know, where the owner still has a, either is still advising or has a big impact on um, the behaviors of the advice team that sit underneath them. And really I work on a kind of a consultancy basis. So rather than kind of go in and just you know, provide ei uh training, what I do is effectively start with understanding the business. So exactly as I've been talking to you about the process I used to follow as an advisor, uh, it's the same process I follow when I'm working with practices is I want to find out what's going well in the business, you know, where are the blockers, what's not going so well. And I'm um, a social science researcher. So I'd want to spend some time in the business actually doing a bit of a deep dive and maybe speaking to the team, you know, while the owner's not in the ring and finding out a bit about, you know, how they're seeing things. Because ultimately what that will do is it allows me to kind of look at thematically kind of extracting what types of training interventions might move the needle within the business. And then I put that all into a report for businesses and say look, this is what I think we should be doing. Some of that might be me working one to one, you know, doing that uh, coaching, observing, training with particular people in the business who have been highlighted as requiring development. Or it might be group training, might be taking the whole team through a training program and then following up helping build those developer plans and then being there supporting with the kind of one to ones as they kind of bed in that behavior change. So that's one part of the business, the other part of the business is working for the larger kind of firms. So I've done a bit of work for Fidelity this year and last year and they, they, they're looking to ah, hire me as a kind of uh, a, an authority expert on the topic to put together training programs that go out to the advisors that they work with. So it's kind of the two aspects like an external speaker, uh, trainer that's kind of brought in by some of the larger companies. And then the other one is kind of a bit more hands on, you know, applying not only the science but my experience of having been there and you know, and run a business.

Speaker A: Right. So are the big firms like uh, so you mentioned Fidelity, like are the Wirehouses, Merrill Morgan, ubs, Wells Fargo, are they embracing this. Are the big banks embracing it or is this largely in the RIA space right now?

Speaker B: In the UK there's been a huge kind of interest in um, emotional intelligence, behavioral finance, relational skills. And I've seen a lot of the kind of people who are quite influential in the UK are actually based in the US and so I think there's a bit of, you know, good bit of crossover. We've got good people who are kind of sort of specialists in looking at the retirement piece from a retirement transition about how do you support people through, you know, what is profound psychological transition. So I think the RAAs are really interested in it as a topic. Then, uh, you know, we've got, the larger institutions are interested in it either as the RRAs are clients of theirs and they want to be seen to providing, you know, thought leadership to the RIAs and helping them kind of develop these skills. But also we've got some quite large companies in the UK now here. Um, like the banks for example. The banks or the whole exited the advice market in around about 2012, 2013 and then this year they're starting to come back. So they've had 15 years, you know, nearly out of the market and they're coming back because they're spotting opportunity for face to face advice. So I think actually, you know, it's a hot topic now and I think kind of all segments of the market are looking at how do they develop non technical skills, uh, to help them succeed in the future.

Speaker A: Can someone who was not born with strong eq, can they learn this?

Speaker B: Absolutely. One of the interesting things about EQ is it's not like IQ for example. Iq, you know, is our sort of cognitive ability. There was some good research that was done probably about I think 2016, which look at all these sort of brain training apps like if you do Sudoku, do you get smarter, you get better at Sudoku, but it doesn't translate into performance, uh, on another, you know, you don't get better at crosswords from doing Sudoku, for example. So the IQs are pretty much fixed and there's not a lot we can do about that. But EQ has been shown to be a trainable ability. So regardless of where you are now, if you understand your strengths and weaknesses and put a plan together for improvement, everyone has the ability to improve their eq. And it's not like personality, for example, where it's quite hard to shift the dial. Like let's say if you're quite strongly introverted and you find social situations difficult, if you kind of took that approach and said, well, look, can we make you extremely extroverted? You know, the answer will be, well, probably not. But eq, you know, absolutely helps see that person. Because noticing that you feel uncomfortable in, say, a networking situation, if you have to do that professionally, having the tools in the bag to manage that thinly and throw yourself into the experience, that's EQ in action. So doesn't matter of kind of your baseline of where you are, EQ can have a big impact on your ability to perform across a range of different contexts. Homework, you know, with friends.

Speaker A: Yeah. Let's talk about your comment that eq, or strong emotional intelligence, is what can make an advisor untouchable by AI. And I assume the premise being that I can't replace human relationship. It may be able to come up with the questions, but at least for today, it lacks the ability to know what to do with that information and to create the human connection. Talk to me more about that. How and why is that? I mean, is that part of why people are coming to you, because they're worried about AI encroaching on their business?

Speaker B: Where we are at the moment is actually AI. Let's look at healthcare for a second. Chatbots in healthcare have actually been outperforming humans in some respects. So there's a type of therapy called cognitive behavior therapy that's been run with AI agents and patients. And as researchers have shown that actually disclosure, uh, has increased when patients are speaking to a chatbot. Because cognitive behavior therapy is like, you know, it's guided, you know, as a method, it's a methodology to it. But disclosure increases. And this theory behind that is, is that people open up more when they don't feel like they're being judged by another person. So that's interesting because that's sort of saying to us, well, actually, people are trusting AI agents. They have quite, very, very personal information. And, uh, people are already kind of getting that feeling of empathy with AI agents. Because if you tell an agent something deeply personal and it says, you know, that must have been really difficult for

Speaker A: you, for example, it does that well, it gives you wonderful feedback about how great you are or what a smart question you just asked.

Speaker B: Yeah, but it's synthetic. It's not real empathy. It's synthetic empathy. Whilst we might feel actually this, we get that feeling that we're being understood, it's not real. And I think the advisor's edge is. Look, I think where we might end up with this is that if you kind of take a step back and you do this kind of exercise of what's my ideal client? You know, the ideal client is, I think now is someone who is still time poor. So yes, an AI agent might be able to interview you, you know, build a financial plan. But do you really want to spend the time doing that or do you have any inclination to do that? No. Well, that's a perfect client who would hire an advisor. They value human relationships. Obviously the, when we, when we do get AI entering the advice market, it's going to be at a lower price point. So actually we're now talking about a difference between experience. So the experience of being with an advisor comes at a premium. So that experience is going to be what people are going to pay additional value for. So it's the experience of dealing with a human, the experience of dealing with a human who can talk them through complex information or options, help them understand their thinking and apply judgment, connect with those emotions, these. But there's a whole range of information that we, we get when we're talking face to face, which AI doesn't have access to. So back to that retirement example. Uh, if we say, well, look, M, I've modeled your plan. If we do X, Y and Z, you're not going to run out of money when you retire, you're going to be okay. And then the person, usually what they do is they sigh with relief, which is actually the emotion of joy, but relief is actually happiness. So that sigh of relief and that sort of softening of muscle tension in the body that you see when you're face to face with another person, AI

Speaker A: quant doesn't get that data and how powerful is that? So why does that matter? If I say I have X, I need Y, I have X number of years until I retire, will I have enough money to retire the way I want to? AI can spit that answer out faster than any financial advisor and it'll come back hopefully saying yes. They'll know that I will experience relief and joy because I'll write back saying, great news. It'll say, yes, that is fabulous news. It'll tell me why I'm relieved and all that sort of stuff. So why does that matter?

Speaker B: I think fundamentally it comes back to trust. For those people who can get that quick answer, they'll go, yeah, that's great. But there'll be some people in kind of go, yeah, fine, I'll take that answer at face value. There'll be other people who go, well, what have you made a mistake? Quite interesting. They're actually people will, you know, get the Same answer from a human advisor. And they'll trust it more. And I think one of those things is because we're wired for connection. So when empathy develops, it's quite interesting, something which you see in young children, for example, is when we develop very, uh, early stage, from about three or four years old, before children have learned to self regulate their emotions. You see emotional contagion in groups of children, you know, happen quite rapidly. You get one child who say, gets a toy taken away from them and starts crying. And then all the other children at the same age in the nursery start crying. Now none of those other ones are crying because they're sad. They're crying because we have these things called mirror neurons, which means we pick up and mirror the emotional state of people around us. So you actually get an experience of shared feeling. And especially if you've got strong rapport, strong relationship, you actually share emotions of the people around you. Now of course, as we kind of grow out of um, that developmental stage, we learn this ability to understand that actually what we're feeling isn't, oh, isn't, isn't happening to us, it's happening to someone else. But have you ever been around? My favorite example for this is if my wife is on a bad day at work, as she comes home and starts slamming the door and banging me cupboards, I start to feel anger because it's rubbing off, it's in the room. So it's this shared understanding that uh, I think is where the value is. And so absolutely the answer might be faster and quicker, but for some clients, they value that experience of having that answer delivered by someone who understands them.

Speaker A: And I think so. The point is that there will be clients or prospects that will value the efficiency of AI that don't necessarily need the face to face, that don't necessarily. They just want the answer. They want the answers to the test. They don't care how you got there. But what you're talking about is finding the clients that really value the human connection. And if that's what in fact is going to make advisors untouchable, then they need to make sure that they really strengthen this skill.

Speaker B: It's not just the arts of it, it's the whole experience that's wrapped around that. So obviously last year, and my wife took me to a restaurant and we had a lovely, lovely meal and on the menu there was this cup of coffee and the beans were like the, one of the rarest beans in the world. They're the ones that get eaten by this little animal in the Jungle and it creeps them out and, and then the beans get roasted. But it was about £40 for this cup of coffee. I thought, well, I'm going to have that. But that's the experience, isn't it? You know, I could get a cup of coffee at McDonald's. But actually the experience of this, you know, something which is rare, exclusive, delivered in an amazing environment, that's what you're paying for. So you've got to remember that actually if experience dictates a lot of what we value as well, so because if we, all of our decisions were made on price, Ferrari wouldn't have a business because everyone would just be buying the cheapest car that does the job. You're going to think advisors, you know, are going to kind of operate in this space where they need to think about the whole package, as in the experience that's delivered on the advice.

Speaker A: But it speaks to the notion of any advisor that isn't thinking about AI's impact on his business and how to reshape or rewire the business, even just rewiring the value proposition, retooling their value proposition. How they explain their value and what they do needs to change because they're competing not only with uh, the advisor that sits next to them or down the hall, but they're competing with AI. How about as AI, as you see, AI develop. So fast forward five years, you and I are talking about where AI is today. But AI is God knows where it'll be five years from now. So how do you foresee, do you still foresee the advisor being untouchable if they get this right five or ten years from now?

Speaker B: I don't think it's financial advice that's unique with this because I think it's, you know, any profession where at the moment, you know, human judgment and understanding are values. Healthcare for example, same thing. Doctors follow sort of consultancy process. You know, you've got sort of like tax, legal, a whole range of professions which are all grappling with the same problem. So I think in five years time, I think the answer is, is that we just don't know what AI will look like. But certainly at the moment, if you track what, you know, color Claude are doing, you know, with sort of cowork and what Perplexity is doing with its source skills and add ons, a lot of it is actually at the moment geared up to freeing up the advisor's time so that they can spend more time with clients. So I think the kind of, at the moment this sort of trend is looking like AI companies want to support advisors to be way more efficient so that they can deal with more clients. But in five years time, who knows? I think probably one of the biggest leaps that will happen is when AI is no longer working from say, just a transcript. If it gets out of that kind of chat where you can actually kind of interact with an AI agent like you and I are talking, I think that's going to provide a different experience because then, uh, you're moving it from, you know, as I said, that kind of structure where somebody's sat there tapping away at a keyboard, having a conversation with a chat bot effectively to actually having a conversation with an embodied agent, you know, with a face, gestures, you know, a voice, you know, that will, I think will start to change things a little bit.

Speaker A: Yeah, well, it will be an interesting future for sure. This has been a fascinating conversation. I really enjoyed it and, um, thank you so much for sharing so graciously. Is there anything to wrap up that I didn't ask you that if that you would want an advisor to know about this concept or anything you're thinking about?

Speaker B: I think we've taken a pretty, you know, uh, a broad sweep and then a deep dive into certain areas. What an rma, I think really probably how to get started. You know, I think probably one of the, I mean you mentioned, obviously, you know, I've got a book that, that you share the links to, which is fantastic. Audiobooks available to that as well on, you know, on Spotify or to wherever audiobooks are listed. But I think there's a lot of good advice in that about how to get started. So I think, you know, for people who are looking at kind of that, that next step of what do we do? It'd be, yeah, pick up a book and have a bit of a deep dive if you want to skip the book and come straight to, you know, having a conversation with me. Then I wrote a weekly email which goes out once a week, which is just my news topic. So very much like, you know, we've been talking today. You know, I share ideas on that once a week or on LinkedIn. You know, I'm um, around on LinkedIn as well.

Speaker A: Good. Well, we will link all of it so everyone knows how to find you. Thank you again for being so gracious. Love the topic, love the work that you're doing, love that there's a need for it and can't wait to see where you go from here, really.

Speaker B: No, enjoyed it. Thank you. Thank you.

Speaker A: M. As a financial advisor, you hold yourself to the highest standards of integrity, honesty and credibility. You are successful because you take your professional responsibility seriously and are dedicated to your clients. But are you living your best business life life? Are your goals aligned with your firms or could a better option exist? Should I Stay or Should I Go? Is a book written with you in mind. It's a self guided journey that walks you through the key steps that we take with our advisor clients. This strategic thought process and roadmap to professional self discovery is designed to help you ask the right questions and think critically and objectively whether you're considering change or not. Learn how to get your copy@ah diamond-consultants.com thebook.