Investments of retirement savings in stocks and units trusts made under the Central Provident Fund Investment Scheme (CPFIS) have taken quite a hammering in the global market meltdown.
Nearly half of all CPFIS investors who sold their Ordinary Account investments in the year ended Sept 30 - 440,000 CPF members, or 49 per cent - have lost money, up from 43 per cent a year earlier.
One such investor, school teacher Ms Catherine Lee, 40, got cold feet after her CPFIS investment lost 30 per cent. She could not stomach any more losses. 'I made a loss of $10,000 after selling off my unit trust investment in September. The market was very volatile. I preferred to bite the bullet and realise the loss rather than to wait and see.'
Another 279,000 or 31 per cent of OA investors made modest profits but would have been better off, or done just as well, leaving the cash to earn the Ordinary Account 2.5 per cent interest rate. This was up from 29 per cent a year earlier.
Only about 174,000 members, or 20 per cent - down from 28 per cent - made profits from their CPF savings over and above the 2.5 per cent they could have earned anyway.
For everyone else, who left their investments in place rather than sell, the picture was also quite bleak.
Overall, CPFIS investments in stocks, units trusts and property funds were well in the red, on paper. Only bonds, as well as gold, were in the black.
The CPF board attributed the poor performance to the financial meltdown which has hurt investment returns.
'The market has turned sharply from the bull market in 2007 to a bear market this year. Well-known financial institutions taking massive write-down coupled with a series of collapses such as Bear Stearns, Fannie Mae, Freddie Mae, Lehman Brothers and AIG injected much panic and volatility in the market,' it said.
Straits Times 22 Dec 2008
Monday, December 29, 2008
Saturday, December 27, 2008
The Concerns of the Prospective Agent
“You can make more than $100,000 in your first year of work.” “There is no limit to your income, and if you work hard, you can make millions by the time you retire.” “Nobody determines or stop you from making all the money you wish to have unlike a salaried job.”
Why do these recruitment pitches ring hollow in today’s increasing sophisticated labor force? It may work many years ago, but it is no longer effective in attracting candidates to the life insurance industry. People generally know that if you succeed in life insurance sales you can make plenty of money…but the big question is can they make it. If you can’t do the job successfully, the promise of riches carries little promise for them.
Don’t for a moment forget that persuading people to start a career that pays solely on commission is asking them to take great leap of faith, particularly if they already have a decent job even though it may not the most satisfying one. So your first task as a recruiter is to address their deepest concerns in taking up this new challenging career. Starting a new career is momentous decision, one that is not reached until all questions, doubts and uncertainties are cleared or clarified. This is not to say that all risks have to be eliminated. People understand that there are risks involved in any career change but they need to understand the risks involved and how they can mitigate them.
When recruiting fresh candidates (those who have never been in insurance/investment sales or have less than 1 year of experience), the 3 primary concerns of the candidate are:
1. Can I do it? What are the skills and knowledge I need to succeed? Do I have the aptitude to do well in this business?
2. Can you help me succeed? What kind of training and support do I get to help me succeed? What’s your track record of helping new agents succeed? What’s the reputation of your company in the industry?
3. Is it worth doing? If I am reasonably satisfied that I can succeed (by you addressing point 1&2), should I embark on this career change? How would my family, relatives and friend perceive my career change? What’s my career path or direction? How would I be remunerated (yes, money is still important, albeit it is one of the many concerns)? What are the non-monetary perks and incentives?
Address these 3 concerns effectively, you are more than half-way there! Hey who say recruitment is easy!
Why do these recruitment pitches ring hollow in today’s increasing sophisticated labor force? It may work many years ago, but it is no longer effective in attracting candidates to the life insurance industry. People generally know that if you succeed in life insurance sales you can make plenty of money…but the big question is can they make it. If you can’t do the job successfully, the promise of riches carries little promise for them.
Don’t for a moment forget that persuading people to start a career that pays solely on commission is asking them to take great leap of faith, particularly if they already have a decent job even though it may not the most satisfying one. So your first task as a recruiter is to address their deepest concerns in taking up this new challenging career. Starting a new career is momentous decision, one that is not reached until all questions, doubts and uncertainties are cleared or clarified. This is not to say that all risks have to be eliminated. People understand that there are risks involved in any career change but they need to understand the risks involved and how they can mitigate them.
When recruiting fresh candidates (those who have never been in insurance/investment sales or have less than 1 year of experience), the 3 primary concerns of the candidate are:
1. Can I do it? What are the skills and knowledge I need to succeed? Do I have the aptitude to do well in this business?
2. Can you help me succeed? What kind of training and support do I get to help me succeed? What’s your track record of helping new agents succeed? What’s the reputation of your company in the industry?
3. Is it worth doing? If I am reasonably satisfied that I can succeed (by you addressing point 1&2), should I embark on this career change? How would my family, relatives and friend perceive my career change? What’s my career path or direction? How would I be remunerated (yes, money is still important, albeit it is one of the many concerns)? What are the non-monetary perks and incentives?
Address these 3 concerns effectively, you are more than half-way there! Hey who say recruitment is easy!
The Age of the Digital Native
Sooner or later, the financial services representative has to deal with this coming generation of consumers, the tech savvy generation.
Actually, there are about 200 million reasons to believe it. That's the rough number of kids around the world that currently have Internet access. Marc Prensky, a writer and video-game developer, coined the term "digital native" to describe the cohorts that are coming of age in the Internet era. The rest of us he aptly identifies as “digital immigrants." Like most immigrants, we often struggle to understand the incomprehensible customs of the natives.
Reared on social media, always on Internet connections, cell-phone cameras, Facebook, and YouTube, digital natives live on the same planet as digital immigrants, but inhabit a very different universe. They can concentrate on multiple projects simultaneously, they collaborate seamlessly and spontaneously with people they've never met, and most important, they create media with the same avidity that previous generations consumed it. This is the net generation, a demographic perfectly adapted to a future in which online communities will supplant the conventional corporation.
How do you, the financial services representative, relate to this group of people, how do you communicate and collaborate with them will be the new challenge for prospecting in the digital age.
Actually, there are about 200 million reasons to believe it. That's the rough number of kids around the world that currently have Internet access. Marc Prensky, a writer and video-game developer, coined the term "digital native" to describe the cohorts that are coming of age in the Internet era. The rest of us he aptly identifies as “digital immigrants." Like most immigrants, we often struggle to understand the incomprehensible customs of the natives.
Reared on social media, always on Internet connections, cell-phone cameras, Facebook, and YouTube, digital natives live on the same planet as digital immigrants, but inhabit a very different universe. They can concentrate on multiple projects simultaneously, they collaborate seamlessly and spontaneously with people they've never met, and most important, they create media with the same avidity that previous generations consumed it. This is the net generation, a demographic perfectly adapted to a future in which online communities will supplant the conventional corporation.
How do you, the financial services representative, relate to this group of people, how do you communicate and collaborate with them will be the new challenge for prospecting in the digital age.
SMART Goals
Each goal you create should be SMART: Specific, Measurable, Attainable, Relevant, and Timed with a deadline. Let’s clarify the concept of a SMAR'T goal.
Specific. The goal must be clearly defined with parameters that state who, what, when, where, and how. Specific goals help you stay focused on one thing at a time. For example, stating that you want to become a member of a networking group is fine, but you can define your goal more clearly by saying that you want to become a member of a specific chamber or a particular association.
Measurable. The goal must include a way of measuring the results. This typically means that there is a number associated with the goal, such as how many or what percentage—some quantifiable way to measure progress toward the goal. Stating that you want to receive more referrals this year is neither specific nor measurable; it’s more useful to say specifically that you want a 30 percent increase to your referral business from a networking group.
Attainable. Each goal that you create must be within reach. It should not be so far-fetched that it’s out of your vision. To determine whether a goal is attainable, consider what you accomplish this year. Then consider what you have coming up next year that may either impede or improve your ability to meet a specific goal. Finally consider everything that needs to be done to accomplish your goal. When all is said and done, do you honestly feel that with hard work, dedication, and focus, you can meet this goal. If so, write it down and commit to achieving it..
Relevant. The goal must have relevance and meaning for you; otherwise, you will not be motivated to accomplish it. What will be the outcome if you meet a particular goal? Will you make more money? Will you have a higher quality of life? Will you be able to save for retirement more comfortably? Will you get a promotion or a raise? Will you save time in the long run? Whatever your personal motivation, ensure that your goals tap into it. Doing so will inspire you every day to keep striving toward the finish line.
Timed. Speaking of a finish line, the goal must have a deadline or completion date assigned to it. Without one, You will lose your focus and your desire to meet your goal in a timely manner. Our human competitive nature draws us to the finish line. We need to aim for a target. For example, stating that you want a 30 percent increase in your referral business from your participation in a networking group is indeed specific and measurable, but how long will it take, and when will you measure it? Stating that you want a 30 percent increase in your annual referral business from the association by December 31 will be much more effective, because it contains a deadline.
When you put all of these elements together, you might end up with a goal statement that looks like one of these:
I will become a member of the ABC Chamber by June 30
I will achieve a 30 percent increase in my annual referral business from networking in (a certain networking group by December 31).
Specific. The goal must be clearly defined with parameters that state who, what, when, where, and how. Specific goals help you stay focused on one thing at a time. For example, stating that you want to become a member of a networking group is fine, but you can define your goal more clearly by saying that you want to become a member of a specific chamber or a particular association.
Measurable. The goal must include a way of measuring the results. This typically means that there is a number associated with the goal, such as how many or what percentage—some quantifiable way to measure progress toward the goal. Stating that you want to receive more referrals this year is neither specific nor measurable; it’s more useful to say specifically that you want a 30 percent increase to your referral business from a networking group.
Attainable. Each goal that you create must be within reach. It should not be so far-fetched that it’s out of your vision. To determine whether a goal is attainable, consider what you accomplish this year. Then consider what you have coming up next year that may either impede or improve your ability to meet a specific goal. Finally consider everything that needs to be done to accomplish your goal. When all is said and done, do you honestly feel that with hard work, dedication, and focus, you can meet this goal. If so, write it down and commit to achieving it..
Relevant. The goal must have relevance and meaning for you; otherwise, you will not be motivated to accomplish it. What will be the outcome if you meet a particular goal? Will you make more money? Will you have a higher quality of life? Will you be able to save for retirement more comfortably? Will you get a promotion or a raise? Will you save time in the long run? Whatever your personal motivation, ensure that your goals tap into it. Doing so will inspire you every day to keep striving toward the finish line.
Timed. Speaking of a finish line, the goal must have a deadline or completion date assigned to it. Without one, You will lose your focus and your desire to meet your goal in a timely manner. Our human competitive nature draws us to the finish line. We need to aim for a target. For example, stating that you want a 30 percent increase in your referral business from your participation in a networking group is indeed specific and measurable, but how long will it take, and when will you measure it? Stating that you want a 30 percent increase in your annual referral business from the association by December 31 will be much more effective, because it contains a deadline.
When you put all of these elements together, you might end up with a goal statement that looks like one of these:
I will become a member of the ABC Chamber by June 30
I will achieve a 30 percent increase in my annual referral business from networking in (a certain networking group by December 31).
Business Week Poll: What Investors Are Thinking
The views of U.S. investors in the aftermath of the financial crisis:
If you have to choose the one investment that you think would be the best to make right now, what would it be?
1. Common stock
2. Government bonds
3. Real estate
4. Mutual funds
5. Bank or savings or loan deposits
6. Moneny market funds
7. Gold or other precious metals
In the long run, what sort of total returns (capital gains plus dividends) do you expect the stock market to produce for you?
49%: 5% to below 10% a year
24%: 10% to below 12% a year
10%: below 5% a year
8%: 12% to below 15% a year
5%: 15% or higher a year
4%: don't invest in stocks
How helpful or harmful has your adviser's advice been throughout the past year?
Very helpful: 23%
Somewhat helpful: 35%
Neither helpful nor harmful: 29%
Somewhat harmful: 10%
Very harmful: 3%
Extracted from: Special Issue: Investment Outlook, Business Week Dec 29, 2008
If you have to choose the one investment that you think would be the best to make right now, what would it be?
1. Common stock
2. Government bonds
3. Real estate
4. Mutual funds
5. Bank or savings or loan deposits
6. Moneny market funds
7. Gold or other precious metals
In the long run, what sort of total returns (capital gains plus dividends) do you expect the stock market to produce for you?
49%: 5% to below 10% a year
24%: 10% to below 12% a year
10%: below 5% a year
8%: 12% to below 15% a year
5%: 15% or higher a year
4%: don't invest in stocks
How helpful or harmful has your adviser's advice been throughout the past year?
Very helpful: 23%
Somewhat helpful: 35%
Neither helpful nor harmful: 29%
Somewhat harmful: 10%
Very harmful: 3%
Extracted from: Special Issue: Investment Outlook, Business Week Dec 29, 2008
Sunday, December 7, 2008
Solutions Focus
It might sound obvious that to improve people's performance we need to focus their thinking on solutions, rather than problems. Yet it’s surprising how little we do this in practice. Somehow people always prefer to go straight to the problems.
There's nothing inherently wrong with focusing on problems. The issue is that there is simply a more useful place to put our attention, which is onto solutions.
Focusing on problems leads us to the past. It leads us to try to change what can't be change. Focusing on problems leads to blame, excuses, and justifications. It's complicated, slow, and often drains our mental energy. Focusing on solutions, however, immediately creates energy in our mind. We open up ideas and possibilities. If we want people to come up with great ideas, to think well, to reach their potential as financial planners, we want them focused on solutions most of the time. This doesn't mean we don't address problems—far from it; it means we address them by analyzing the way forward, instead of their causes. Let me illustrate this with the following examples:
Why didn't you hit your targets? (Problem)
What do you need to do next time to hit your targets? (Solution)
Why did this happen? (Problem)
What do you want to achieve? (Solution)
Where did it all start to go wrong? (Problem)
What do you need to do to move this forward? (Solution)
Why do you think you're not good at this? (Problem)
How can you develop strength in this area? (Solution)
What's wrong with your team? (Problem)
What does your team need to do to succeed? (Solution)
Why did you do that? (Problem)
What do you want to do next? (Solution)
Who is responsible for this? (Problem)
Who can achieve this? (Solution)
Why isn’t this working? (Problem)
What do we need to do to make this work? (Solution)
You might notice the word “why" in many of the problem-focused questions, yet there's no use of that word around solutions. Being conscious of removing the word why" from our conversion can be a great way to remember to focus on solutions.
Looking at the examples above, even though there's only a slight difference in the wording of the questions, when you take a solutions focus, you end up having very different conversations than when you focus on the problem.
Research from the field of solutions-focused therapy is showing that focusing on solutions is a fast and effective way of addressing quite real problems. Take a look at this quote from The Solutions Focus: It is often easier to start something new than to stop something. Anything that is a habit, it is by definition difficult to stop. And, if change is encouraged by positive reinforcement, it is much easier to be aware of when you are taking the reinforceable action than to know when you are not doing whatever it is that you want to give up.”
Problems disappear into the background as solutions develop. This makes sense when you go back to the principle that our wirings drives our perceptions: the more we focus on the solutions, we see these solutions becoming real.
There's nothing inherently wrong with focusing on problems. The issue is that there is simply a more useful place to put our attention, which is onto solutions.
Focusing on problems leads us to the past. It leads us to try to change what can't be change. Focusing on problems leads to blame, excuses, and justifications. It's complicated, slow, and often drains our mental energy. Focusing on solutions, however, immediately creates energy in our mind. We open up ideas and possibilities. If we want people to come up with great ideas, to think well, to reach their potential as financial planners, we want them focused on solutions most of the time. This doesn't mean we don't address problems—far from it; it means we address them by analyzing the way forward, instead of their causes. Let me illustrate this with the following examples:
Why didn't you hit your targets? (Problem)
What do you need to do next time to hit your targets? (Solution)
Why did this happen? (Problem)
What do you want to achieve? (Solution)
Where did it all start to go wrong? (Problem)
What do you need to do to move this forward? (Solution)
Why do you think you're not good at this? (Problem)
How can you develop strength in this area? (Solution)
What's wrong with your team? (Problem)
What does your team need to do to succeed? (Solution)
Why did you do that? (Problem)
What do you want to do next? (Solution)
Who is responsible for this? (Problem)
Who can achieve this? (Solution)
Why isn’t this working? (Problem)
What do we need to do to make this work? (Solution)
You might notice the word “why" in many of the problem-focused questions, yet there's no use of that word around solutions. Being conscious of removing the word why" from our conversion can be a great way to remember to focus on solutions.
Looking at the examples above, even though there's only a slight difference in the wording of the questions, when you take a solutions focus, you end up having very different conversations than when you focus on the problem.
Research from the field of solutions-focused therapy is showing that focusing on solutions is a fast and effective way of addressing quite real problems. Take a look at this quote from The Solutions Focus: It is often easier to start something new than to stop something. Anything that is a habit, it is by definition difficult to stop. And, if change is encouraged by positive reinforcement, it is much easier to be aware of when you are taking the reinforceable action than to know when you are not doing whatever it is that you want to give up.”
Problems disappear into the background as solutions develop. This makes sense when you go back to the principle that our wirings drives our perceptions: the more we focus on the solutions, we see these solutions becoming real.
Monday, December 1, 2008
Emotional Intelligence
Probably the most important competencies of a financial planner are those of emotional intelligence (EI). The model introduced by Daniel Goleman focuses on EI as a wide array of competencies and skills that drive leadership performance. Goleman's model outlines four main EI constructs:
1. Self-awareness — the ability to read one's emotions and recognize their impact on oneself.
2. Self-management — involves controlling one's emotions and impulses and adapting to changing circumstances.
3. Social awareness — the ability to sense, understand, and react to others' emotions while comprehending social networks.
4. Relationship management — the ability to inspire, influence, and develop others while managing conflict.
Goleman includes a set of emotional competencies within each construct of EI. Emotional competencies are not innate talents, but rather learned capabilities that must be worked on and developed to achieve outstanding performance. Goleman posits that individuals are born with a general emotional intelligence that determines their potential for learning emotional competencies.
1. Self-awareness — the ability to read one's emotions and recognize their impact on oneself.
2. Self-management — involves controlling one's emotions and impulses and adapting to changing circumstances.
3. Social awareness — the ability to sense, understand, and react to others' emotions while comprehending social networks.
4. Relationship management — the ability to inspire, influence, and develop others while managing conflict.
Goleman includes a set of emotional competencies within each construct of EI. Emotional competencies are not innate talents, but rather learned capabilities that must be worked on and developed to achieve outstanding performance. Goleman posits that individuals are born with a general emotional intelligence that determines their potential for learning emotional competencies.
Saturday, November 29, 2008
Active Listening
Active listening is an acquired skill that is critical to your sales success. It is more than just listening, it is:
1. Listen
2. Don't interrupt
3. Don't finish the other person's sentences
4. Don't say "I knew that"
5. If the other person praises you, just say "Thank you"
6. Don't be distracted. Don't let your attention or eyes wander elsewhere while the other person is talking
7. Maintain your end of the dialogue by asking intelligent questions that (a) show you're paying attention, (b) move the conversation forward, and (c) require the other person to talk (while you listen)
8. Eliminate any striving to impress the other person with how smart or funny you are. Your only aim to let the other person feel that he or she is accomplishing that
1. Listen
2. Don't interrupt
3. Don't finish the other person's sentences
4. Don't say "I knew that"
5. If the other person praises you, just say "Thank you"
6. Don't be distracted. Don't let your attention or eyes wander elsewhere while the other person is talking
7. Maintain your end of the dialogue by asking intelligent questions that (a) show you're paying attention, (b) move the conversation forward, and (c) require the other person to talk (while you listen)
8. Eliminate any striving to impress the other person with how smart or funny you are. Your only aim to let the other person feel that he or she is accomplishing that
Friday, November 28, 2008
Organize Your Priorities
We all have a lot we want to accomplish and don't know where to start. You want it all and you want it now. Where do you start? You're going to have to choose to do one thing first. You may be able to solve more than one problem at a time, but if you try to tackle them all at once, you'll be overwhelmed. You have to put your objectives in order of importance and plan to start at the top of the list.
Whether you have 3 goals or 30, you have to assign an order to each goal, putting the most important at the top of the list. Only you can decide what that order will be. Examine each one and choose which is most important and should come first. The more time you put into prioritizing now, the more time and energy you'll save down the road.
Prioritizing your goals will clarify which ones demand your immediate attention and which are not quite as urgent. All goals are not created equal, so sorting them out is essential. To achieve success, you need to know what you're aiming for. In order to get what you want, you first must clarify what it is you want and in what order you want it. And it is also essential to do this exercise on paper (or computer), it will improve significantly the probability of you taking the necessary follow-up actions to achieve the goal.
Whether you have 3 goals or 30, you have to assign an order to each goal, putting the most important at the top of the list. Only you can decide what that order will be. Examine each one and choose which is most important and should come first. The more time you put into prioritizing now, the more time and energy you'll save down the road.
Prioritizing your goals will clarify which ones demand your immediate attention and which are not quite as urgent. All goals are not created equal, so sorting them out is essential. To achieve success, you need to know what you're aiming for. In order to get what you want, you first must clarify what it is you want and in what order you want it. And it is also essential to do this exercise on paper (or computer), it will improve significantly the probability of you taking the necessary follow-up actions to achieve the goal.
Goal Obsession: The Good Samaritan
A classic example of the adverse consequence of goal obsession was the "Good Samaritan" research done by Darly and Batson at Princeton in 1973. In this widely-referenced study, one group of theology students was told that they were to go across campus to deliver a sermon on the topic of the Good Samaritan. As part of the research, some of these students were told that they were late and needed to hurry up. They believe people would be waiting for them to arrive. Along their route across campus to the chapel, Darly and Batson had hired an actor to play the role of a "victim" who was coughing and suffering. 90% of the late students in Princeton Theology Seminary ignored the needs of a suffering person in their haste to get across campus. As the study reports, " Indeed, on several occasions, a seminary student going to give his talk on the parable of the Good Samaritan literally stepped over the victim as he hurried on his way!"
What's the implication of this study on our own focus on goals? Do our drive to achieve our goals overwhelm the principles of mutually-beneficial relationship, clients' interest and family harmony? We have to ask ourselves "Am I achieving a task at the expense of our values and longer term aspirations?"
What's the implication of this study on our own focus on goals? Do our drive to achieve our goals overwhelm the principles of mutually-beneficial relationship, clients' interest and family harmony? We have to ask ourselves "Am I achieving a task at the expense of our values and longer term aspirations?"
Tuesday, November 25, 2008
Delayed Gratification
Imagine that you are a four-year-old nursery school student. Your teacher explains that you’ll be playing a new game today. She offers you a single tasty marshmallow that you can eat immediately. However, if don’t eat it right away, she will give you two marshmallows when she returns from an errand. What do you do? Do you take the sure thing and gobble the goodie in front of you? Or do you fight temptation, delay gratification, and reap the double pleasure of two marshmallows?
Most four-year-olds and virtually all younger children choose the immediate over the delayed reward and eat the single marshmallow within seconds of being left alone with it. Psychologist Walter Mischel conducted this simple study at Stanford University’s Bing Nursery School.
So what? A big what! When they were interviewed years later, as eighteen-year-olds, the children who had delayed gratification had developed a range of superior emotional and social competencies compared with the children who had eaten the treat immediately. They were better able to deal with adversity and stress, and they were more self-confident, diligent and self-reliant. Mischel and his team also discovered the intellectual ability of children who controlled their impulses was markedly higher than those who did not. The third of the children who were able to control their impulses at age 4 scored 210 total points higher on verbal and math SAT scores than the impulsive four-year-olds! How big a difference is that? It is as large as the average difference between the abilities of economically advantaged and disadvantaged children. It is the larger than the difference between the abilities of children from families whose parents have graduate degrees and children whose parents did not finish high school. The ability to delay gratification at age 4 is twice as a predictor of later of SAT scores as IQ. Poor impulse control is also a better predictor of juvenile delinquency than IQ.
Most four-year-olds and virtually all younger children choose the immediate over the delayed reward and eat the single marshmallow within seconds of being left alone with it. Psychologist Walter Mischel conducted this simple study at Stanford University’s Bing Nursery School.
So what? A big what! When they were interviewed years later, as eighteen-year-olds, the children who had delayed gratification had developed a range of superior emotional and social competencies compared with the children who had eaten the treat immediately. They were better able to deal with adversity and stress, and they were more self-confident, diligent and self-reliant. Mischel and his team also discovered the intellectual ability of children who controlled their impulses was markedly higher than those who did not. The third of the children who were able to control their impulses at age 4 scored 210 total points higher on verbal and math SAT scores than the impulsive four-year-olds! How big a difference is that? It is as large as the average difference between the abilities of economically advantaged and disadvantaged children. It is the larger than the difference between the abilities of children from families whose parents have graduate degrees and children whose parents did not finish high school. The ability to delay gratification at age 4 is twice as a predictor of later of SAT scores as IQ. Poor impulse control is also a better predictor of juvenile delinquency than IQ.
Monday, November 24, 2008
Change or Die
How difficult is it for people to change their normal way of life? Change to be a better husband or father, to be a better boss or employee, to be fitter or healthier person. No problem you may think. Think again…and again.
FAST magazine in May 2005 published an article titled ‘Change or Die’. This is what Dr. Edward Miller, the dean of the medical school and CEO of the hospital at Johns Hopkins University has to say "If you look at people after coronary-artery bypass grafting two years later, 90% of them have not changed their lifestyle. And that's been studied over and over and over again. And so we're missing some link in there. Even though they know they have a very bad disease and they know they should change their lifestyle, for whatever reason, they can't." In other words, your chance of changing is nine to one against you, even if your life depends on it.
The conventional wisdom says that crisis is a powerful motivator for change. But severe heart disease is among the most serious of personal crises, and it doesn't motivate -- at least not nearly enough. Nor does giving people accurate analyses and factual information about their situations. What works? Why, in general, is change so incredibly difficult for people? What is it about how our brains are wired that resists change so tenaciously? Why do we fight even what we know to be in our own vital interests?
Dr. Dean Ornish, a professor of medicine at the University of California at San Francisco and founder of the Preventative Medicine Research Institute, in Sausalito, California, provides some answers in his successful program. "Providing health information is important but not always sufficient," he says. "We also need to bring in the psychological, emotional, and spiritual dimensions that are so often ignored." Why does the Ornish program succeed while the conventional approach has failed?
For starters, Ornish recasts the reasons for change. Doctors had been trying to motivate patients mainly with the fear of death, he says, and that simply wasn't working. For a few weeks after a heart attack, patients were scared enough to do whatever their doctors said. But death was just too frightening to think about, so their denial would return, and they'd go back to their old ways. The patients lived the way they did as a day-to-day strategy for coping with their emotional troubles. "Telling people who are lonely and depressed that they're going to live longer if they quit smoking or change their diet and lifestyle is not that motivating," Ornish says. "Who wants to live longer when you're in chronic emotional pain?"
So instead of trying to motivate them with the "fear of dying," Ornish reframes the issue. He inspires a new vision of the "joy of living" -- convincing them they can feel better, not just live longer. That means enjoying the things that make daily life pleasurable, like making love or even taking long walks without the pain caused by their disease. "Joy is a more powerful motivator than fear," he says.
Pioneering research in cognitive science and linguistics has pointed to the paramount importance of framing. George Lakoff, a professor of those two disciplines at the University of California at Berkeley, defines frames as the "mental structures that shape the way we see the world." The big challenge in trying to change how people think is that their minds rely on frames, not facts. "Neuroscience tells us that each of the concepts we have -- the long-term concepts that structure how we think -- is instantiated in the synapses of the brain," Lakoff says. "Concepts are not things that can be changed just by someone telling us a fact. We may be presented with facts, but for us to make sense of them, they have to fit what is already in the synapses of the brain. Otherwise, facts go in and then they go right back out. They are not heard, or they are not accepted as facts, or they mystify us: Why would anyone have said that? Then we label the fact as irrational, crazy, or stupid."
Reframing alone isn't enough, of course. That's where Dr. Ornish's other astonishing insight comes in. Paradoxically, he found that radical, sweeping, comprehensive changes are often easier for people than small, incremental ones.
For example, he says that people who make moderate changes in their diets get the worst of both worlds: They feel deprived and hungry because they aren't eating everything they want, but they aren't making big enough changes to quickly see an improvement in how they feel, or in measurements such as weight, blood pressure, and cholesterol. But the heart patients who went on Ornish's tough, radical program saw quick, dramatic results, reporting a 91% decrease in frequency of chest pain in the first month. "These rapid improvements are a powerful motivator," he says. "When people who have had so much chest pain that they can't work, or make love, or even walk across the street without intense suffering find that they are able to do all of those things without pain in only a few weeks, then they often say, 'These are choices worth making.' "
Another vital factor is to give people the multifaceted support they need. That's a big reason why 90% of heart patients can't change their lifestyles but 77% of Ornish's patients could -- because he buttressed them with weekly support groups with other patients, as well as attention from dieticians, psychologists, nurses, and yoga and meditation instructors.
Neuroscience, a field that has exploded with insight, has a lot more to say about changing people's behavior -- and its findings are guardedly optimistic. Scientists used to believe that the brain became "hardwired" early in life and couldn't change later on. Now researchers such as Dr. Michael Merzenich, a professor at the University of California at San Francisco, say that the brain's ability to change -- its "plasticity" -- is lifelong.
What lessons do we have here on changing ourselves? And also for managers on strategies to help their reps improve their performance. How do we reframe the issue of getting out of poverty into achieving a grander lifestyle by helping others. How do we perform radical, widespread changes rather pursue small, incremental changes in our behavior. And let’s not forget the support infrastructure that needs to be in place to ensure feedback and positive reinforcement to our efforts to improve.
FAST magazine in May 2005 published an article titled ‘Change or Die’. This is what Dr. Edward Miller, the dean of the medical school and CEO of the hospital at Johns Hopkins University has to say "If you look at people after coronary-artery bypass grafting two years later, 90% of them have not changed their lifestyle. And that's been studied over and over and over again. And so we're missing some link in there. Even though they know they have a very bad disease and they know they should change their lifestyle, for whatever reason, they can't." In other words, your chance of changing is nine to one against you, even if your life depends on it.
The conventional wisdom says that crisis is a powerful motivator for change. But severe heart disease is among the most serious of personal crises, and it doesn't motivate -- at least not nearly enough. Nor does giving people accurate analyses and factual information about their situations. What works? Why, in general, is change so incredibly difficult for people? What is it about how our brains are wired that resists change so tenaciously? Why do we fight even what we know to be in our own vital interests?
Dr. Dean Ornish, a professor of medicine at the University of California at San Francisco and founder of the Preventative Medicine Research Institute, in Sausalito, California, provides some answers in his successful program. "Providing health information is important but not always sufficient," he says. "We also need to bring in the psychological, emotional, and spiritual dimensions that are so often ignored." Why does the Ornish program succeed while the conventional approach has failed?
For starters, Ornish recasts the reasons for change. Doctors had been trying to motivate patients mainly with the fear of death, he says, and that simply wasn't working. For a few weeks after a heart attack, patients were scared enough to do whatever their doctors said. But death was just too frightening to think about, so their denial would return, and they'd go back to their old ways. The patients lived the way they did as a day-to-day strategy for coping with their emotional troubles. "Telling people who are lonely and depressed that they're going to live longer if they quit smoking or change their diet and lifestyle is not that motivating," Ornish says. "Who wants to live longer when you're in chronic emotional pain?"
So instead of trying to motivate them with the "fear of dying," Ornish reframes the issue. He inspires a new vision of the "joy of living" -- convincing them they can feel better, not just live longer. That means enjoying the things that make daily life pleasurable, like making love or even taking long walks without the pain caused by their disease. "Joy is a more powerful motivator than fear," he says.
Pioneering research in cognitive science and linguistics has pointed to the paramount importance of framing. George Lakoff, a professor of those two disciplines at the University of California at Berkeley, defines frames as the "mental structures that shape the way we see the world." The big challenge in trying to change how people think is that their minds rely on frames, not facts. "Neuroscience tells us that each of the concepts we have -- the long-term concepts that structure how we think -- is instantiated in the synapses of the brain," Lakoff says. "Concepts are not things that can be changed just by someone telling us a fact. We may be presented with facts, but for us to make sense of them, they have to fit what is already in the synapses of the brain. Otherwise, facts go in and then they go right back out. They are not heard, or they are not accepted as facts, or they mystify us: Why would anyone have said that? Then we label the fact as irrational, crazy, or stupid."
Reframing alone isn't enough, of course. That's where Dr. Ornish's other astonishing insight comes in. Paradoxically, he found that radical, sweeping, comprehensive changes are often easier for people than small, incremental ones.
For example, he says that people who make moderate changes in their diets get the worst of both worlds: They feel deprived and hungry because they aren't eating everything they want, but they aren't making big enough changes to quickly see an improvement in how they feel, or in measurements such as weight, blood pressure, and cholesterol. But the heart patients who went on Ornish's tough, radical program saw quick, dramatic results, reporting a 91% decrease in frequency of chest pain in the first month. "These rapid improvements are a powerful motivator," he says. "When people who have had so much chest pain that they can't work, or make love, or even walk across the street without intense suffering find that they are able to do all of those things without pain in only a few weeks, then they often say, 'These are choices worth making.' "
Another vital factor is to give people the multifaceted support they need. That's a big reason why 90% of heart patients can't change their lifestyles but 77% of Ornish's patients could -- because he buttressed them with weekly support groups with other patients, as well as attention from dieticians, psychologists, nurses, and yoga and meditation instructors.
Neuroscience, a field that has exploded with insight, has a lot more to say about changing people's behavior -- and its findings are guardedly optimistic. Scientists used to believe that the brain became "hardwired" early in life and couldn't change later on. Now researchers such as Dr. Michael Merzenich, a professor at the University of California at San Francisco, say that the brain's ability to change -- its "plasticity" -- is lifelong.
What lessons do we have here on changing ourselves? And also for managers on strategies to help their reps improve their performance. How do we reframe the issue of getting out of poverty into achieving a grander lifestyle by helping others. How do we perform radical, widespread changes rather pursue small, incremental changes in our behavior. And let’s not forget the support infrastructure that needs to be in place to ensure feedback and positive reinforcement to our efforts to improve.
Relationship between Recruitment and Performance
Some managers regard recruitment as more important than performance management. Recruit as many people as possible…let those who can't perform leave and replacing them with those who can. This erroneous practice is based on the assumption that: the supply of good candidates is plentiful and you can recruit easily, and recruitment and performance are unrelated issues.
Performance and recruitment are not mutually exclusive because one of best sources of recruitment is recommendations from your existing reps…and they will only recommend their friends and clients only if they are succeeding and they feel that the agency environment is conducive for growth. If they feel negative, or even neutral, of their agency culture and their own performance, it is highly unlikely that they will take the initiative of helping you recruit people.
Performance and recruitment are not mutually exclusive because one of best sources of recruitment is recommendations from your existing reps…and they will only recommend their friends and clients only if they are succeeding and they feel that the agency environment is conducive for growth. If they feel negative, or even neutral, of their agency culture and their own performance, it is highly unlikely that they will take the initiative of helping you recruit people.
Commitment to Follow-Through
Even when a sales system is well-designed, it doesn’t guarantee successful implementation if the culture within the team is not performance-oriented. The analogy is joining a well-equipped fitness club to lose weight…if the commitment is weak, you would not persist and your objective will not be met.
On the other hand, if the commitment is strong, you would not only lose weight but you may be able to develop a nice physique due to the wide range of the equipments that allow you to develop your muscles. In a high performance sales team, the sales manager ensures that the sales team embraced and follow through on the sales system. The high adoption of the sales system a cause or an effect is immaterial…what is important is that high performance sales teams adopt sales system that work for them.
On the other hand, if the commitment is strong, you would not only lose weight but you may be able to develop a nice physique due to the wide range of the equipments that allow you to develop your muscles. In a high performance sales team, the sales manager ensures that the sales team embraced and follow through on the sales system. The high adoption of the sales system a cause or an effect is immaterial…what is important is that high performance sales teams adopt sales system that work for them.
Sunday, November 23, 2008
Objectives of SPM
SPM is an integrated system to facilitate the improvement of sales results of Financial Services Representatives (Reps) in the following areas:
1. Systematic Planning
2. Self-organization System for Prospecting and Activity Tracking
3. Evidenced-based Coaching by Managers
4. Professional Advisory Process
5. Client Relationship Management
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