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December 03, 2018 at 03:23 PM
Logic is critical to effective financial planning, to be sure. So what better expert to turn to for honing logical thinking skills than the great French philosopher-mathematician-scientist who said: “I think, therefore I am”?
Indeed, Rene Descartes’ “Cartesian logic,” based on four simple questions, can help advisors uncover clients’ needs and concerns, thus leading to the best investment solutions, Raphael Lapin, Harvard-trained negotiation and mediation specialist, tells ThinkAdvisor in an interview.
Used in the initial client consultation or proposing a specific investment or making changes in a portfolio, the questions act to elicit productive discussion and help clients see a decision’s consequences “from a 360-degree perspective,” says Lapin.
His Los Angeles-based Lapin Negotiation Services, pivoting on methodology taught at Harvard Law School, provides training, coaching and dispute resolution for clients that include AT&T, Microsoft, Yahoo and individual financial advisors.
As for posing Descartes’ four questions — Lapin calls them a powerful technique to not only see the consequences of an action or inaction but the “anti-consequences” too — they are:
- What would happen if you did X?
- What would happen if you didn’t do X?
- What won’t happen if you did X?
And the fourth — the most challenging and tantalizing of all:
What won’t happen if you didn’t do X?
The questions need not be asked in a cluster nor in sequence; they may be sprinkled, as needed, throughout a discussion.
Lapin is author of “Working With Difficult People” (DK Penguin 2009), a guide to the art of compromise and negotiation. His training for firms and individuals focuses on a proprietary “Investigative Selling Approach.”
ThinkAdvisor recently interviewed the consultant, on the phone from his Wilshire Blvd. office. He discussed Cartesian logic as a way to “obtain critical information toward building satisfactory outcomes.” Interesting math factoid: Descartes is credited with co-inventing analytic geometry, which uses algebra for problem-solving.
Here are excerpts from our interview:
THINKADVISOR: Which of the four questions is apt to prompt the most interesting response?
RAPHAEL LAPIN: The last question, “What won’t happen if you didn’t do X?” because it really convolutes and twists your mind. It forces you to think in a way that you wouldn’t otherwise. It’s quite a difficult exercise to contort your mind into thinking what won’t happen if you didn’t do something. But when you start thinking that way, often you’ll see new angles to an [issue].
Why is it so hard to contemplate that question?
Our minds are conditioned to think about what will happen — what are the consequences? We’re not conditioned to think about: What are the anti-consequences?
When would a financial advisor use these questions?
One scenario is in the initial client consultation before they’re providing financial solutions. If the advisor is putting together a letter of engagement but the client isn’t sure, the advisor can say, “I don’t want to pressure you, but maybe I can be helpful in analyzing this for you. Let’s talk a little about what’s likely to happen if we went ahead with this relationship — and what’s not likely to happen.”
