The Level of Customer Orientation Behaviour in Financial Planners in Malaysia

Customer orientation behaviour’ refers to an employee’s tendency or predisposition to meet a customer’s needs during service encounters, and has become a prime variable of interest for organizations to promote their products or services nowadays. In the financial planning industry in particular, customer orientation behaviour was conceptualised as a behavioural construct of financial planners in practising marketing concepts to assist customers in making financial decisions to satisfy their needs. To serve customers better, financial planners ought to understand customers’ needs and wants. Besides, financial planners must always prioritize customers’ best interests by adopting customer orientation behaviour when rendering financial planning services. Financial planners with a high level of customer orientation will help customers to make holistic financial decisions by diagnosing their financial needs and offering the solutions that satisfy those needs. Often, such customer-oriented behaviours require the financial planners to sacrifice immediate business gains in favour of customers’ best interest, fostering long-term relationships with the customers.

Indeed, in Malaysia, the level of customer orientation behaviour among financial planners is encouraging. The plausible reason for the common adoption of customer orientation behaviour among financial planners is mainly due to a more educated and knowledgeable population in the country which has led to a higher demand for financial planning services. According to Bank Negara Malaysia’s Financial Sector Blueprint, as the country shifts towards a higher income status, the financial needs of Malaysians have become more varied and sophisticated, increasing demands for more high-quality and innovative financial services. Because of the multiplicity and complexity of financial products in the marketplace, customers need to rely on financial planners to get the best advice, suggestions, and recommendations. It has been found that customers were more satis!ed in developing financial plans with financial planners compared to those who did not engage such services. Therefore, financial planners must exhibit customer orientation behaviour to cater to those demands.

Further, the increased competition and the fast-changing environment in the marketplace may also have caused financial firms to encourage their
financial planners to adopt customer orientation financial firms try to satisfy the needs, provide quality services and maintain excellent interpersonal relationship with their customers by eliciting customer orientation behaviour in their professional conduct. Therefore, financial planners need to change their focus from product pushing to a needs-based approach in financial planning. Financial planning as a profession has laid down a strong foundation for the emergence of a needs-based advisory approach during customer engagement, stimulating the adoption of customer orientation behaviour as compared to the conventional product selling approach. “Placing the client’s interest first” is ranked as the most important domain customers valued in financial planners, suggesting that customer orientation behaviour is vital to influence the performance of financial planners.

Correspondingly, financial planners ought to deliver customer-oriented services to cater to the complex needs of their customers. In this respect, financial planners are urged to be customer centric, meaning they must be trained to take care of their customers’ interest first before their own. Practitioner bodies in Malaysia have promoted customer orientation behaviour among financial planners by reminding financial planners to always put the interest of the customers first before their commissions. This could also explain the high level of customer orientation behaviour of financial planners in Malaysia.

Interestingly, the adoption of customer orientation behaviour has not been influenced by the gender, ethnicity, age, income, education level, and financial planning experience of financial planners in Malaysia. That is, regardless of the financial planners’ demographic differences, they showed a similar level of customer orientation behaviour. This has been due to financial planners, regardless of those constructs, having to adhere to the professional codes of ethics in their practices. With the financial planning industry still in the infant stage even after not more than 20 years in the country, those constructs were not examined in the context of their influence on the customer orientation behaviour of financial planners in Malaysia.

Demonstrating customer orientation behaviour is now being aggressively promoted in the financial planning industry in Malaysia. Knowing the nature and impact of customer orientation behaviour on the financial planning industry, financial planners are encouraged to adopt customer orientation behaviour in their professional practices. Given the increase in the standard of living along with the complexity of financial instruments, it is timely that the customer orientation behaviour of financial planners is given due attention. This is paramount to the development of the !nancial planning industry in Malaysia.

Share this post

Share on facebook
Share on twitter
Share on linkedin
Share on email

You may like

Asset Management

What is Personal Financial Engineering?

Personal Financial Engineering (PFE) refers to the use of mathematical and statistical techniques to solve financial problems systematically, as defined by Investopedia. This article explains