Hugh Massie is a global pioneer in the practical application of behavioral insights. A “reformed CPA” and serial entrepreneur, Hugh has since 2001 focused his efforts on his role as CEO and Founder of Atlanta-based DNA Behavior International. It is a behavioral sciences company employing data and technology solutions to enable individuals and organizations to discover and leverage strengths. Hugh’s “behaviorally smart” solutions have impacted more than 1.5 million people/year in 125 countries and 11 languages, including leaders 2,500+ businesses and 20,000 financial advisors.
How did you get into the industry?
When I’d finished my college degree in commerce, specializing in accounting and economics, I jumped straight into the big wide world of Arthur Andersen as a chartered accountant. Within 5 years of starting my career, I had the good fortune to get sent to work in Singapore and Thailand for 4 years. As a young man from Australia, this was very exciting environment. In some ways, I was very much on my own, unsupervised in this environment and able to soak up a very deep cultural experience. When I returned to Sydney, where I thought I would be living for the rest of my life, I realized the Asian experience had made me restless and that working in a corporate environment wasn’t for me. That’s when, at the age of 30, I branched out on my own.
I already knew I had the entrepreneurial and pioneering spirit. I’d already begun to do some deals and sensed I was a risk-taker. Even though I had some uncertainty when I left Arthur Andersen, I set up a financial services business to work with high-net-worth families.
What I realized is, a few years into that, I wasn't as satisfied dealing with the money side of all that. I was more interested in the human dynamic side. I wanted to know what made my clients tick, but also what made me tick. A friend asked me a great question - what are you really passionate about? That one question made me realize I wanted to help people all over the world to become more self-empowered. That’s what took me into the human behavioral journey. Not teaching them stocks or bonds but teaching people about themselves.
I knew human behavior and how they made life, financial and investment decisions was an area of interest, so I went on the journey of building my own system to uncover this. Friends linked me with contacts in Atlanta and so I came here 40 times in four years, pulled out my checkbook and got on to building a system between 2001 and 2006. And, bingo, I'm here; I'm here to stay. I'm even an American citizen now and part of the Atlanta community and the global community still. So, that's sort of been the journey to get me to where I am today.
Any emerging industry trends?
Well there’s no question the financial sector is under great scrutiny, not just in terms of regulatory oversight but also the way they advise their clients. Even though Behavioral Finance was being talked about in the 70s, the whole subject came into prominence in 2002 when Daniel Kahneman won the Nobel Prize for his work on Prospect Theory, and more so in 2011 when he published his book, Thinking Fast and Slow. This brought the whole subject of behavioral finance to the forefront of the financial services industry.
As we all know, the financial industry moves slowly, and frankly it’s taken highly reported fraud cases to really shake up the sector.
Just observing people and traditional risk profiling doesn’t get below the surface of investors. This is where their actual behavior is hidden, and financial advisors must know how to uncover what is happening as investors think through decisions. There are years of psychological research that has documented behaviors and biases in decision making. It’s crucial for financial advisors to understand this, so they can guide and advise investors accurately.
The Financial sector is by no means alone in this area of needing to deliver open, transparent and accurate advice. Understanding how to communicate with people crosses every area of life. From the Doctor speaking to parents about their sick child to the sales clerk in your local furniture store. If there is no deep understanding of how people communicate with each other, messages will be missed at best and distorted at worst.
Any industry opportunities or challenges?
We are currently working in the whole area of hiring. We are not a recruitment firm. But recognize the mistakes made at the hiring stage and are working with many businesses to introduce our tools and services.
Hirers, Recruiters and HR departments must become “behaviorally “smart.” They will need to employ new methodologies in the hiring process. Matching the natural talents, not just to the role, to teams, management and organizational strategies is a key to organizational and business success. They need to get below the surface of candidates to identify true behaviors, passions, values, and purpose to help ensure you haven’t hired a potential rogue.
We’ve found that a light bulb moment for many HR departments, when we’re talking to them about recruitment, is that a candidate can complete a 15-minute online questionnaire that will deliver significant insight that’s measurable and reveals hidden behavior that could be revealed under pressure or find talents not identified in resumes.
Getting hiring wrong is expensive and destructive to businesses – so the hiring area definitely needs some attention.
We also work extensively in corporate governance. Again, you only have to pick up a newspaper to see how many “issues” that make the headlines began in the board room. The #metoo campaign opened the eyes of the world to inappropriate behavior that could and should have been identified and challenged at previous points, from recruiting to the board level. When behaviors like this are linked with positional authority, it’s a recipe for disaster. But it can be identified and managed.
Inspiration for the business idea, and your vision for the Business?
In my career as an international wealth mentor I saw many wide-ranging clients making financial decisions with varying degrees of success. Some made consistently good choices, while others repeatedly made poor decisions that minimized the return on investments. This puzzled me so I determined to understand why this behavior occurred. What I discovered was interesting, in that people asking for advice in terms of their finances are actually talking about their lives. They’re unknowingly engaging their financial personality, trying to line up their life issues, hopes, dreams and goals with their finances. This journey of discovery is why I started the business. I see the future of the business empowering every person whether investor, advisor, entrepreneur, business leader, parent to be able to understand themselves and why they make the life choices they do. I see the ability to do this at the touch of a button on every and any device.
What's next for the Business in the near future?
There are two forces driving our business right now:
1. The demand for customized experiences – the end user out there (e.g. investor client or employee) wants to feel understood and connected with a customized experience delivered to them. Businesses have gotten to the Innovation 2.0 level, which is smarter technology to make the experience slick and user friendly. However, Innovation 3.0 is where the game will get played out when technology is used to enable the business to serve each client uniquely. Our systems enable our enterprise users and strategic partners to deliver customized experiences. The key for us is to ensure our system and pricing is flexible enough to enable this to happen at a cost-efficient level.
2. The demand for behavioral insight at a scalable level – following on from point 1, more business leaders recognize the power of behavioral insights and are prepared to design solutions which leverage this. You are seeing more behaviorally driven apps coming. We are setting ourselves up as the “behavioral chip” which powers these apps. Some of them we are incubating.
Your key initiatives for the success of the Business?
One of the key strategies has been to make understanding personality/decision making simple to understand and easier to access. Making a potentially complicated subject easier to grasp and apply, without losing the integrity or validity of the product. So, now we have much simpler reports with the key information delivered in one page and immediately accessible online in technology apps through API data transfer. Further, we have built apps and integrations which mean that the behavioral insights are powering downstream workflows, as well as decision-making.
A big area for us is working with big data to make it little data – in other words putting personality into big data so that it can be better applied at the individual level.
Your most difficult moment at the Business? (and what did you learn?)
There are challenges and obstacles every day. I believe a huge obstacle has been market timing. Whilst human behavioral concepts have been around since BC with Pythagoras, how to apply them on a scalable basis has not been recognized and people have not known how to. Further, the field of behavioral finance, in which we are a leader, was a foreign language 17 years ago when we started. Today, at least people know what it is and recognize the power of mastering it in serving clients. Similar could be said of human behavior generally in regular business areas like hiring, team building and leader development. Beyond market timing, the obstacles have always been in building the right partnerships (one of those threatened the business for a while) and building a team who is passionate about what we do. I am a very big believer in start slow and finish big. Patience is important and managing the instinct to go into overdrive too early can create too much pressure with the wall being hit too early.
Ideal experience for a customer/client?
I suspect it would be much like my own when birthing the concept of the DNA Behavior and that is having an aha moment when, particularly, in the field of investing I realized that my financial advisor wasn’t connecting wealth creation with my life goals. Further, I was not getting communicated with very well – I had solutions pushed down my throat rather than having the options laid out for me to decide. That for me was the time when I realized that if the client/advisor role was built on a platform of “know, engage and grow” with a customized approach to who I uniquely am, the advice I would receive would not only build wealth, but enable me to successfully pursue life goals. That’s when I first voiced the phrase – now commonly used – “understanding people before numbers.” The number one thing for all of us is to feel understood. The client experience must have people walking away feeling understood.
How do you motivate others?
Every person I hire, every client I engage with, is treated as an individual. They complete the Business DNA Natural Discovery Process and, depending on the role they will fill, is positioned in a role which has been subjected to benchmarking to ensure the fit is correct. I have found that this approach not only sets up staff, partnerships and clients for success, it also enables each to bring their own individual talents to the relationship. Then on an ongoing basis every person is managed and evaluated to their strengths. So, they are rewarded more for using their strengths but nevertheless managing their struggles. If down the track, we find someone of good character and work ethic is struggling in a role we work to re-position them into a better fit for their talents and skills. Also, we have a leadership development program for executives using our Business DNA Leadership 360 Discovery Process. This gets to the heart of a person’s performance drive and de-railers. Further, it helps them better balance results and relationships with higher EQ levels. Attrition is low, sickness is low, ability to work effectively together is high and, perhaps most importantly, as each knows the inherent behavior and communication style of the other, there is mutual respect and trust.
Career advice to those in your industry?
The first and most foundational point is that you must know your purpose, values, passions and core talents. Then, knowing this, you must communicate it loud and clear to everyone. A great leader will always help guide you up the pathway if you are personally clear about yourself. Frankly, it is more motivating for everyone. Thereafter, I have learned the importance of not just understanding my leadership style, but also how to manage it, especially under pressure. I firmly believe that our service of using the Business DNA Leadership 360 Discovery Process begins with us as a company and so annually everyone in the business completes this process on me (and the same is done for the C-Suite leaders).
The objective is to create a heightened self-awareness of my leadership strengths and struggles to use for my development purposes. In addition, the specific insights are applied to improve workplace effectiveness, enabling me to be a better leader, and to develop and grow my relationship with my staff in a more positive manner. The focus is to help me more productively apply my strengths and manage my struggles so they do not become weaknesses and reduce my overall effectiveness.
I know I’m an entrepreneur – it’s validated for me and can be for others. Knowing this helped me build my business. I could manage my behavior and know the milestones where I needed to bring others in, and through the DNA Behavior Natural Discovery process, could engage people who were able to fill the gaps in me. That’s been the secret of my success – gathering talent around me. People who grabbed my vision and complimented what I was wanting to build.