WEALTHTECH INSIDER: Three Real-World Applications of Advisor-Client Personality Tests


By Dr. Daniel Crosby

It’s no secret the discipline of wealth management has moved toward building relationships, understanding client goals, and the kind of work that generations past might have dismissed as “soft skills.” More advisor firms and institutions are formalizing the study of human behavior with tools like personality tests. The exact language may differ, whether it’s the DISC study categorizing people as types of birds, the Myers-Briggs Type Indicator, or the Big Five (often abbreviated as OCEAN), but the desire to “know thyself” is almost as old as human knowledge itself.

But what do you actually do with that knowledge?

The results of these personality or leadership assessments can feel ethereal and difficult to get your arms around. But this knowledge lends itself to tangible action in building bridges with clients, prospects, and coworkers. In my experience, here are some of the doors that open for financial professionals who commit to honest evaluations of themselves:

Moving away from ‘good’ and ‘bad’

Most modern personality tests stop short of assigning positive or negative values to common traits. For instance, the “Agreeableness” trait of the Big Five assessment runs on a spectrum from friendly compassion to critical rationality. An advisor who is too accommodating may not be able to rein in a client from acting out of fear or other short-term impulses. But an advisor who is too critical may drive away clients rather than trying to understand their motivations and goals.

There is no one true personality profile of a successful advisor. Understanding your strengths and limits will help you build more meaningful ties with others.

Walking outside your own biases

While there is no such thing as a perfectly unbiased viewpoint, understanding broad categories of personality traits – and your place within them – is an important first step to stepping outside of your own biases and building empathy with other people.

Many personality models lend themselves to “Z-Model Decision Making,” in which a leader is encouraged to examine an issue from every axis of a personality model. Drawing again from Agreeableness in the Big Five assessment, the Z-Model would prompt you to look at an issue from the vantage of someone who values friendship and consensus-building, and then look at it again through the lens of a more distant, rational perspective.

This is a formal way of “putting yourself in someone else’s shoes.” As our workforce and range of clientele both grow more diverse in every way, this kind of empathy is crucial for long-term engagement and success.

Understanding what motivates people

If you have a hammer, all your problems start to look like nails. And if you know your way around a personality model, you can observe others to guess at how that model would express their personality traits.

Do you have a client who spends time alone between your calls? They might be introverts. Do they view deadlines as strongly-worded suggestions at best? They might be more flexible and spontaneous – with all of the strengths and drawbacks that implies.

Much of the value of a modern advisor is tied to understanding what motivates clients and keeping them on track to accomplish what they care about. Understanding yourself can do wonders to improve your ability to collaborate with other people.

Dr. Daniel Crosby is Chief Behavioral Officer at Orion Advisor Solutions, and a psychologist and behavioral finance expert who helps organizations understand the intersection of mind and markets.