Contributed By: Shivani Chopra, CFA
“If we enter into commitments, it encourages us to do more though it might not guarantee performance” said Jim Keene, CFA- Founder and MD of Atherton Consulting group, LLC at the Speaker Session organised by IAIP Delhi on Apr 9th 2016. The event titled “Influencing without Formal Authority” was designed for professionals who do not have the sole authority to make investment decisions and discussed the meaning, importance and tools to aid in successful influencing.
So, what does it mean to influence and why is it important? To influence is to motivate and enable others to change. Research shows that 9% of working people have job descriptions as true sales. Other 91% spend approximately 40% of their work time trying to influence decisions. Examples include preparing presentations, having conversations with bosses, getting securities included in a portfolio, helping teams collaborate better, etc. These decisions help us to invest capital, assign roles and utilize resources. As we work in knowledge worker driven business with less hierarchy and greater interdependence, this topic becomes extremely relevant in our work life. Different people will have different opinions. The more we learn to interact with different personalities, the more effective we will become. Jim shared six strategies from the classic book “The Psychology of Persuasion” by Dr. Robert Cialdini which was originally written for marketers and showed how these can be used for investment and business decisions.
The Six Ethical Principles of Influence:
- Reciprocation: We feel an obligation to give back to others after they have given to us. Be the first one to give service, information and concessions. Jim mentioned that combined performance is better than individual actions.
- Power of Consistency and Commitment: When people commit publicly, it will be more valuable. So start small and build public commitments.
- Social Proof: Here effective networking is the key. Unleash people power by showing responses/testimonials of similar others and past successes. As an example, a venture capitalist while making a funding decision in a start-up might be influenced by opinions of other venture capitalists, debt team, past success rate of the founders, etc.
- Liking: Just the way we feel happy to see our friends regularly liking, commenting and sharing our Facebook posts, the strategy of liking, complimenting and co-operating works well in organizations too. People want to associate with others having similar interests.
- Authority: People with deep domain knowledge are able to influence better. One can portray authority through professionalism, industry knowledge and credibility. Also research shows that chances of influencing go higher when we acknowledge our shortcomings first.
- Scarcity: People can be persuaded by the situations that create scarcity like limited time offer advertisements. Investor decisions can be influenced by emphasizing genuine scarcity, highlighting unique features and exclusive information.
After having learnt the principles that affect human behaviour, comes the million dollar question,” How can we harness the power of influence to bring a positive change in others like a fellow employee or perhaps our own selves?” The leadership book “Influencer: The Power to Change Anything” attempts to provide an answer. It delivers a proven model and highlights six sources of influence- Personal Motivation, Personal Ability, Social Motivation, Social Ability, Structural Motivation and Structural Ability. If we wish to change the persistent and resistant views of people, we must come up with innovative ways to create new experiences and new motives. Make change inevitable! Jim shared his own success story of completing a triathlon, a milestone he thought he didn’t have the ability to achieve. However with the encouragement of his coach he was able to surpass his own limits.
To organise our thinking and create a workable model, an influencing template can be used which addresses the stakeholder needs and concerns vs. our needs and plans. This template is used in practise as a tool for continuous planning and action. Later the participants were asked to choose the strategies which they will use while responding to certain situations. The important conclusion from this exercise was to show that there cannot be one strategy that will work alone. We must use multiple strategies liberally. These tools work best in long term when we try, test and adapt them to our own circumstances.
Jim ended the session by offering a free thirty minutes feedback/consultation to the participants who will fill out the Personal Influencing Plan Template. Now that’s a shining example of Reciprocation strategy!