This article appears in the February 2022 issue of Advisor’s Edge magazine. Subscribe to the print edition, read the digital edition or read the articles online.
This year opened with office returns delayed (again) for many financial workers. If the pandemic’s first year was a scramble to survive and the second was a rush to adapt, the third may require more sober planning about the future of work as cracks appear in on-the-fly solutions adopted many months ago.
A CFA Institute report offers insight into those nagging challenges. Last year, the institute surveyed global financial professionals about how they’re working and how they want to work. The first in a series of reports focused on hybrid work.
In Canada, more than half of financial workers (55%) said they’ve been more efficient working remotely, but only 36% said the same about those they supervise.
That 19% perception gap raises questions not only about the meaning and value of efficiency, but about how remote work affects trust.
Rebecca Fender, one of the report’s authors, noted a possible tension between efficiency and effectiveness in remote work environments. “Can you be as effective?” she asked in an interview. “I think the jury’s still out, whereas you can definitely be more efficient.”
Sales teams in the survey reported an increase in productivity because they couldn’t travel, saving considerable time. But they also reported that it was harder to win new clients and build trust.
One risk manager described in the report how he used to listen for signals on the trading desk that something was happening, monitoring colleagues’ emotions. “If it was too quiet or if it was too loud, he knew there was something amiss,” Fender said. “I think it’s those sorts of signals that could be missed [in a remote setting].”
Overall, the report said, the pain points from remote work were in “high-trust activities.”
Some wealth managers noted that video calls provide glimpses into their clients’ lives they wouldn’t otherwise get. But certain conversations with clients are among the “high-trust activities” causing remote pain.
“People appreciate the efficiency of video calls. But without an established relationship, people recognize that, over time, those relationships can weaken,” Fender said.
One of the reasons is that, just as the risk manager looked for signals on the trading room floor to determine if something was wrong, people are constantly looking for signals when deciding whether to trust someone. This also helps explain why we perceive ourselves as efficient remote workers but often are less generous in our assessments of colleagues.
An article last year in the Harvard Business Review said lower trust in remote work settings may exist because “we unconsciously interpret a lack of physical contact as a signal of untrustworthiness.”
Part of adapting to hybrid work will be determining when to book an inefficient face-to-face meeting in order to gain the harder-to-measure benefit of building trust. The CFA report noted that it’s more difficult when working remotely to notice if something is troubling an employee, making retention a challenge. Could the same be true for advisors and clients?
Advisors have hustled to build their books while working remotely over the last two years. Are those new relationships as solid as the bonds with pre-pandemic clients? Is a client who’s never met their advisor in person as likely to stick it out when the market goes south?
Fender said the pandemic has only reinforced the need for advisors to develop soft skills, a requirement that pre-dated Covid-19 as investment management became more automated. Learning to communicate virtually — to convey empathy and hold people’s attention over a screen — is top of the list. “Layer on the distance factor and it really does mean you need to have those skills,” she said.
Advisors have been creative about engaging with clients during the pandemic, hosting backyard meetings or going for walks. That creativity needs to continue. Efficient meetings aren’t always the most effective ones.
Mark Burgess is managing editor of Advisor’s Edge. Email him at email@example.com.