Market Volatility: Does the Wait-and-See Approach to Communication Work?
Crisis situations are realities that every business or organization must be prepared to deal with — whether it’s a market downturn like the one we saw this past spring, or a major global event such as the coronavirus pandemic. Often, business and organizational leaders are required to respond to these situations right away, even when they don’t have all of the information needed to make important decisions.
As a financial advisor, you may have considered adopting a “wait-and-see” approach to communicating with your clients in the face of major crises or events. The big question is: does this approach work?
Here are a few important things to know before deciding to deploy or ditch the “wait-and-see” strategy.
The “Wait-and-See” Approach Is Reactive Rather Than Proactive
The worst time to start preparing for a crisis is after it has already occurred. Yet, this is what the “wait-and-see” strategy advocates — waiting to see how the crisis will unfold to act instead of having a pre-crisis plan in place before disaster strikes.
This leaves you and your clients with little control over the risks and uncertainties associated with particular crisis situations. Even worse, it leaves your clients wondering if you are overseeing their assets with the care they expect.
You May Appear Insensitive to Your Clients’ Woes
In times of crisis, your clients rely on you for guidance and reassurance. They want a qualified person to tell them that, somehow, they’ll weather the storm.
As soon as you learn that something’s wrong, quickly turn your focus on client touchpoints and how you can help address their problems and concerns. Use every communication channel you’re on to let them know that you empathize with their predicament and also to suggest what they can do to survive the hard times.
Being as proactive as possible tells your clients that you care about what’s happening to them and their businesses and that you’re playing an active role in helping them stay afloat.
Providing your clients with as much useful information as you can is always better than doing nothing. Avoiding action because you fear doing the wrong thing will only leave your clients feeling abandoned and stressed.
Since every mistake you make may come back to haunt you, it’s important to bear in mind that facts are incredibly important when you’re communicating to your clients.
You May Easily Become Irrelevant to Your Clients
Today’s domestic and global markets have become more fluid than ever before, thanks to a variety of major structural shifts, including economic realignment, technological advances, increased competition, changing demographic trends, and new consumer needs.
As you avoid action to see what will happen next, your clients can turn to local or international professionals for help with handling their crisis situation. As a result, you may lose your relevance to clients and end up in the path of rapid demise during or after the crisis.
You May End up Passing up Great Opportunities
In every crisis situation, there are risks and opportunities. However, only business leaders that have a growth mindset can see the opportunities that lie beyond the risks they face.
The “wait-and-see” approach to managing a crisis makes it seem like the benefit of saying “no” and avoiding action always outweighs saying “yes” and taking action. Yet, the potential gain from saying “yes” and taking action may sometimes be greater than the cost of the perceived risk and expense.
In a world where every business is constantly looking for ways to carve out an edge over the competition, failing to be proactive in a time of crisis could very well be a pitfall for your business.
The Waiting Game Is Over
Quite understandably, gathering all of the accurate information you need to effectively communicate with your clients during crisis situations is no easy task. However, this isn’t the time to go MIA. Instead, it’s the perfect time to maintain constant communication with your clients.
The “wait-and-see” mindset requires you to wait and see what will happen next before you can reach out to your clients. While this approach may have worked well in the past, it may not be suitable for today’s highly digitized and volatile business landscape. Avoiding action in crisis situations may only serve to give other businesses the chance to get ahead while your clients’ businesses face the risk of closure.
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