Do good guys always finish last?
Not according to the Lennick Aberman Group in Minneapolis, a performance-enhancement consultancy. It recently led a study commissioned by Minneapolis-based Ameriprise Financial Services. The findings: Good guys in financial services—advisors who demonstrate high "moral competency"—finish first by making more money for their clients in the long term.
The study examined the client-portfolio returns of 22 Ameriprise financial advisors who were chosen based on their high performance. It evaluated their returns for the four years beginning in 2001. Researchers also interviewed the advisors and coded the transcripts of those conversations for signs of specific moral competencies: integrity, service orientation, concern for order and quality, teamwork, self-confidence, and achievement orientation. Integrity outweighed all other factors in separating the 12 top performers in the group from the other 10, whose investment returns—while good—were significantly lower. The top 12 advisors outperformed the Standard & Poor's 500 by an average of 73 percent over the four years evaluated.
But what is moral competency, and is it really any different than just plain doing a good job?
"It is possible for someone to do a good job without being morally competent," says Rick Aberman, a founding partner of Lennick Aberman Group. "Moral intelligence is knowing right from wrong, and moral competency is doing what's right under pressure. And having integrity, one of the moral competencies, is the ability to walk the talk, being consistent about what you say you're about."
He cites an example familiar to many financial advisors: A client wants to make an investment that doesn't jive with his or her long-term strategy. An advisor could make the investment, making money for himself and, in the short term, making the client happy—in essence, "doing a good job." But advisors who have a high level of integrity stand their ground and even risk losing the client because that investment doesn't fit with the long-term plan.
The study raises questions: Would the same principles apply to performance in other fields? An implied "yes" comes in the form of the re-release this summer of Moral Intelligence: Enhancing Business Performance and Leadership Success, a 2005 book by Doug Lennick, another of Lennick Aberman's founders. And can such a small study sample yield meaningful results? Lennick Aberman Group say its results were "highly statistically significant," and proof that so-called soft skills matter.
"When it comes down to it, if all talent is equal, what differentiates one from another?" Aberman asks. "It's the emotional and moral competencies, the soft skills, that make hard results."
