Anxiety is at the core of the hand-holding call. But the question is whose anxiety, the client's or the broker's?
During periods of market volatility and market sell-offs, many brokers reach for the phone to comfort clients and allay their anxiety. In the past several months, brokers have spent considerable time hand-holding their clients. Many believe this is a necessary ingredient of good service.
When a broker initiates a hand-holding call, he or she assumes the client is fearful and concerned about their investments. The broker takes on the role of the parent who holds the child's hand while navigating him or her through their fears. The assumption is that the broker is familiar with this scary territory while the client is not.
Additionally, hand-holding calls often are initiated as a disarming technique. The broker is concerned the client will be angry, and the call is intended to head off this resentment. The broker believes the client will be less critical if they call to reassure them and alleviate their anxiety.
Anxiety is at the core of the hand-holding call. But the question is whose anxiety, the client's or the broker's? It is not always easy to tell if the broker calls to ease the client's anxiety or their own.
Let's look at some of the assumptions underlying hand-holding in an effort to understand clients' reactions and needs.
There are two types of client attitudes toward hand-holding. One type loves, needs, wants and demands hand-holding calls. The other type has no particular need for such a call. Clients who like hand-holding calls fall into two further categories: satiable and insatiable.
Satiable clients feel good that you have called since they feel you are attentive and are aware of what is happening. If your intention is to reinforce the working alliance, your mission will be readily accomplished.
Insatiable clients are another matter. They want the hand-holding calls, but they never seem to quite calm their anxiety. Your attempts to reassure them never penetrate and take hold.
The diagnosis of the two types can be made as soon as you hang up the phone. With the satiable clients, you feel good and perhaps relieved. With the insatiable clients, you feel a bit agitated and despondent. They might feel better, but you feel worse.
Satiable clients like to be called but do not necessarily expect to be called. They would just as soon hear your recommendations as receive the hand-holding.
Insatiable clients are not looking for reassurance. They are looking for a guarantee that all your recommendations will be profitable, sooner rather than later. They want you to predict the future and tell them the markets will recover. However, this is a double-bind. If you predict the future, they will remain anxious and unconvinced since they know it is unrealistic. And if you don't predict the future, they will remain anxious, feeling you cannot fully protect them.
If you accept their framing, you are entering into an enduring cycle of hand-holding calls. One call leads to another, which leads to another and another in perpetuity. Furthermore, many clients will become “frozen in place.” You will have a difficult time convincing them to do anything. Their anxiety takes over. You will have to call more, and they will do less. They wait for the perfect moment to act, which remains elusive. In frustration, you call less. As you call less, they get more anxious and resistant.
We'll continue next month with Part II.
Theodore Kurtz is a psychoanalyst based in Cold Spring Harbor, N.Y. He coaches brokers in overcoming performance issues. He can be reached at [email protected].
