The Meaning of Words

When I qualified as a tax lawyer, I had to learn, really quickly, how to read and understand tax legislation. Despite having a degree in psychology and passing all the exams to become a lawyer, reading tax legislation is hard. I had to go back to basics - where was the verb in the clause, what was the object, and what was the subject? I also had to understand complex situations. One of the first tasks I was set was to determine the VAT treatment on an interest rate swap!

But it was also fun. 

If you could arrange events so that a transaction qualified for a relief or benefit, then you could avoid tax - it was called tax planning, even if you ended up where you started.

However, over the years, case law began to erode what was initially considered a fundamental human right that tax law was determined by legislation and had to be certain. Case law first addressed arrangements that led to a return to the original position. The cases made it clear that the intermediate steps could be ignored for tax purposes. Then, case law started to blur the distinction between avoidance, which fell within the words of the legislation, and evasion, which clearly fell outside the rules and was wrong.

Finally, legislation was enacted in 2020 with the General Anti-Abuse Rule, or GAAR. If a series of transactions is put into place to avoid tax, then they could be ignored. Grumph.

The importance of words is a fundamental aspect of the law in this country. This is evident everywhere, as seen in the words used in leases, such as the distinction between a residence and a dwelling, in contracts, case law, and legislation. 

Apart from in tax the most most critical use of words is in a Will or Succession Plan because the person who has written the words can no longer be asked what they meant by them and so the wording is highly technical, such as the difference in using the word ‘shall’ rather than ‘may’.

In everyday communication, especially conveying emotions or feelings, the use of words is considered to be as low as 7%. 55% of meaning is conveyed through body language and 38% through tone.

This must be right. If words played a larger part in communication, then no one would understand irony, and much of our humour would be lost. The definition of irony is the expression of meaning by using language that conveys typically the opposite, either for fun - ‘The irony is that I thought he could help me’ - or for emphasis ‘Don’t overdo the gratiitude’.

Tone is also fundamental.

For example, menacing words are often conveyed through the tone of voice, such as ‘We wouldn’t want to see you get hurt, would we?!’ Expressions of love are also expressed more through tone than through words, as seen in affectionate phrases like ‘My little cabbage’ or ‘Nasty Boy’.

Words used to influence are also well understood psychologically. 

In the book written by the FBI kidnap negotiator Chris Voss ‘Never Split the Difference’ he starts all negotiations with ‘mirroring’. This is to repeat what the kidnapper is saying without agreeing with them. For example, ‘So you want one million pounds for the release of your hostage’. In telling them what he has been told, Chris wants the kidnapper to say ‘That’s right’. This is the sign he looks for, which signals that rapport he has been built. For Chris, this experience often indicates a turning of the tide in his favour as a negotiator.

In my work for clients, I adopted a similar approach. I first set out the problem as perceived by the client. I would then set out the benefits of what the client could expect by taking advice, putting the details and ‘workings’ in the schedule.

The expression ‘That’s right’ is a world apart from ‘You’re right’. An example would be ‘You wouldn’t want to go back to jail?’  If the response is ‘‘You’re right.’ This signifies that you have lost the connection completely.

Apart from the use of facts in mirroring, focus should be on the benefits to persuade. A fact could be ‘we have excellent risk profiling techniques’, rather than ‘We manage your money so you can sleep at night’, a benefit. Look at the ads promoting investment managers - rarely do they focus on the benefit for the clients.

Most professional advisers rely on networking with other professionals to win business. but again too much focus is on the facts surrounding their skill sets rather than on their clients.  

The art of persuasion is to understand the psychology behind communication and then to use the methods identified to win business effectively and efficiently using Client Mapping. 

If professionals want to be profitable they need to understand the psychology of human behaviour and use the tools at their disposal to win business strategically.

Caroline’s Club offers an online training program, complemented by in-person coaching sessions, for its members. This drills down into many other examples of human behaviour to get what you want, whether cross-selling, upselling or developing good working habits.

A good place to start is to book a 30-minute Workshop on Strategic Networking. This takes you through why it is so hard to convey what you do for your clients to your network and shows you how you can crack this mould using some simple-to-use techniques and the tools we can provide as members of our Club. 

If you would like to find out more, contact me and book your slot for our FREE 30 minute presentation on how to win business strategically.