Bleeding Trust from Every Sales Interaction

Last week saw an impressive uptick in conversations about trust in companies. While United may be the strongest case for bleeding trust today, it’s not limited to them. It’s the massive PR mishaps that grab our attention – but that’s misleading. Trust can affect every business – including yours.

It’s not just about the big, egregious faux pas that loses our customers’ trust in an instant. It’s much more about the myriad little, every-day, seemingly trivial ways that add up – ending in a virtual hemorrhage of trust. In no particular order, let me identify a few.

Customer Tales of Woe

In Goodbye Avis, Hello Uber, danah boyd chronicled death by a thousand cuts at the hand of Avis Car Rental. Her rental car got a flat tire at 10 p.m. in Los Angeles, just seven miles from Los Angeles International Airport (LAX). A customer service phone rep said he didn’t know how long it would take to get an exchange. He said he’d text her. An hour later, she had not received a text, so she called again. They said it would take four hours. Outraged, she pushed back. OK, they said, 90 minutes.

They then suggested she leave the car with the keys in it and get a taxi. She left the car but got a ride from friends to her destination. Avis texted that they’d arrive at 4 a.m. They didn’t. She called again, and Avis blamed the towing company. They said it would take 30 minutes. Ninety minutes later a tow truck arrived.

At 4 p.m. the following day she called to make sure Avis had gotten the car. Nope. They said she was still liable. Roadside assistance told her to call customer service, who said to call the LAX counter directly, who passed her call on to the manager, whose call went to voice mail. He didn’t return the call. And, it went on.

The Avis tale may sound exceptional. But I bet you have your own horror stories to relate that are just as bad. And you probably reacted the same way danah did – by changing suppliers, even though she’d been a loyal customer for years.

One Cut at a Time

Not all customer horror stories have 15 fails in a row in a 24-hour period. But it doesn’t matter. Like little cuts, they can add up, and each one adds its own traumatic toll.

  • I went to trade in a car. We had a deal until the salesman noted a discrepancy on the CarFax report. I said I’d fix it. It took six weeks to fix, but I did get it fixed. However, the salesman never called to ask how things were coming along. Result: I bought my new car elsewhere.
  • A friend went to a store at 5:55 p.m. The manager was inside, locking up for the evening. When my friend pointed to the “Hours: 8AM – 6PM” stenciled on the door and pointed to her watch, the manager shrugged his shoulders and turned away.
  • At my daughter’s wedding, I asked if we could borrow a golf cart for 20 minutes to ferry the bride and groom across the wet lawn for photos so as not to get her wedding dress wet. “Sorry, we can’t afford the liability,” was the answer we received.
  • A friend who does small group communication training sessions is routinely asked by large companies to purchase liability insurance to indemnify MegaCo Inc. against any possible harm or claim of harm from anyone for any reason arising out of his delivering a half-day communication training session. (Many of you face the same exact extortionate policy of your customers offloading “risk” to you and having you pay for the privilege.)
  • Some years ago I had a great first sales discussion with a client about doing training to increase trust in their sales process. At the end of the call, he said, “This is great, we have a deal. Now, I presume you’ll grant us our customary 15% discount?” This after having discussed how to help his salespeople to stop cutting prices.
  • I’ll never forget the brokerage office head who, on hearing about my upcoming talk on being a trusted advisor, said, “Hey, anything that’ll increase my share of wallet, I’m all for it!”
  • I constantly receive offers to write articles for my blog in return for links. Ninety-nine percent of the time, they show no awareness of the subject matter of my blog, much less a sense for what quality levels of content might be expected.
  • Customer service scripts are increasingly being loaded with fake empathy and inappropriate apologies: “Oh, I know you feel,” “Oh, I do apologize for the power outage you experienced. …” No. Don’t pretend-feel. An acknowledgement is critical, but apologizing for things you didn’t do is phony.
  • A corporate online feedback site was generating error messages, sending me “not-deliverable” emails. Acting the good business citizen, I called the corporate 800 customer service number to tell them. The customer service rep told me, “The feedback page is not our department.” When at my suggestion she connected me to that department, they insisted on giving me an incident number so I could track my concern going forward. Wait – my concern?
  • On a United Airlines flight from Chicago to Charlotte, North Carolina, two aircraft were taken off the gate due to equipment problems. The third aircraft finally left three hours late. I emailed the airline. I got back a generic apology and a voucher redeemable against future miles—no acknowledgement of the particular issue, much less suggestions about dealing with it. (That reminds me of my cable company: after showing up three hours late, they’re trained to quickly offer you a $20 rebate – a fair deal only if your time is worth less than $7 per hour).

I could go on and on. And so could you. The cut-cut, drip-drip of such low-level, tedious violations of basic customer relationships adds up. It results in listless relationships at best and cynicism, surliness, and passive-aggressive hostility at worst. Finally, we customers jump ship when the opportunity presents itself.

This isn’t “just” about customer service. There is a steel cable linking all customer experiences – sales, service, whatever – with future sales. How everyone treats customers in all ways at all times is a big driver of trust and thus of revenue.

But you already get that point. The more urgent point is this: how can you be sure you’re not imposing such semi-conscious bloodletting on your customers? Here are two ideas.

1. Follow the 10% rule. At every customer interaction point, take 10% more time to close out the interaction in a trust-creating way.

  • If you couldn’t help someone after a five-minute call, then take 30 seconds to suggest an alternate vendor.
  • If you’re going to spend 15 minutes writing an exploratory letter, then spend another two minutes to find some value-add to include in it.
  • If a potential customer walks out the door after an inconclusive interaction, take a note about a content-specific way to follow up in two weeks with an email or phone call.

You think you don’t have 10% more time? Please. Consider how much you put at risk the other 90% of time you did spend by failing to leave a trust-based impression.

2. Personalize responses in some way. Buying is emotionally triggered, and that’s as true for B2B sales as it is for B2C. Don’t let your last impression be the customer seeing dollar signs in your eyeballs.

  • Responding immediately, or in some hugely fast way, is a powerful tool for showing you’re paying attention when someone reaches out to you. Just don’t automate the response. Fast and customized is a powerful combination.
  • If you are responding to an error, don’t minimize it – but also don’t over-accept responsibility for things beyond your control. Acknowledge, explain what must have happened, and – most important – say what you are going to do on your own to ensure it doesn’t happen again.

Sales don’t just happen during selling. They’re a predictable result of your entire mode of relationship with your customers at all times.

Trust, Honesty and Authenticity

A few years ago, Deborah Nixon posted an interesting question on LinkedIn. She asked: “Is there a difference between authenticity and honesty?”

She got about 35 answers. Here’s what I sent in:

Deborah, I’m sure you would agree the two terms cover a lot of territory in common. The trick with these definitional things is not to discover some underlying reality, because there is none; these are conceptual models that help us explain the world. They are good or bad insofar as they help us; so I’d suggest starting there. What’s the most useful way to distinguish the two?

One way might be to say that authenticity is largely passive, and honesty is largely active. When we say someone’s honest, we usually mean they tell the truth, and go out of their way to do it.

Sometimes we also mean that they don’t tell a lie – but that’s far from all the time. You often hear someone way ‘well, he was honest – he didn’t actually tell a lie.’ In such a case, ‘honesty’ just means I didn’t utter an untruth; it’s perfectly consistent with covering up all other kinds of truth. So the casual use of ‘honest’ may rule out sins of commission, but not sins of omission.

That’s why the legal language “the truth, the whole truth, and nothing but the truth” is required in court; to prevent the ‘honest’ witness from conveniently leaving something out, or snow-jobbing the court with irrelevancies.

Authenticity, on the other hand, I think usually implies a lack of attempt to control another’s perception. It means letting others see us as we are, warts and all. I think it also goes one more step: it means letting everyone see us in a way that’s no different from how anyone else see us: that is, we don’t play favorites in terms of constructing alternative fictions to respective people.

At a corporate level, a company might support a claim of honesty by pointing to the truthfulness of its statements, or the lack of court cases against it. Again, ‘honesty’ conveys a sense of ‘never knowingly told an untruth.’ Whether it includes consciously allowing other people to make incorrect inferences by not telling them something – well, that’s not entirely clear.

Authenticity is a whole ‘nother level. It means not hiding out, opening the door in things that are not excluded through standard rules of privacy, letting the chips fall where they may. Further, I think it usually entails a commitment to be authentic, not just a convenient lifestyle.

Seems that of the two, we might say that authenticity is broader (i.e. it encompasses being honest, but goes beyond that to proscribe sins of omission).

On a practical level, people who strive to be honest often talk of it as a struggle: to resist temptation, to not gossip, to say things that can be embarrassing if they are true.

People who choose to be authentic have, in a way, an easier time of it.  For someone who is authentic, the daily default way of life doesn’t involve decisions or will power: the default is openness, there is no issue of control vs. transparency.

Things are what they are, and there is no threat about them.

What’s trust got to do with it?  To trust a person or a company, honesty is table stakes.  If you suspect they’re lying, trust is stopped dead in its tracks.  But even if they’re honest, that’s nothing compared to authentic.

The Zombie Idea of Neuroscience in Business

A zombie idea is one that refuses to die, regardless of repeated efforts to kill  it off.  The idea that neuroscience explains trust and leadership in business is one such zombie. Authors like David Rock and Paul Zak have popularized the idea that we can “understand” themes like trust and leadership better through the wonders of neuroscience, e.g. through the “trust molecule” oxytocin and its effect on the brain.

I’ve personally tried to kill off this zombie – way back in 2007, again  in 2012, again in 2013. But I’m just a business author and blogger.

Ed Hong wrote a withering piece in The Atlantic on Paul  Zak. But The Atlantic can’t compare with night-time talk television: you’ve got to watch late night host John Oliver’s vicious take-down of Zak (skip to minute 10).

And yet – the zombie is back again.  This time, in the Harvard Business Review. In The Neuroscience of Trust Paul Zak states the case for Oxytocin as the causal agent of trust, and identifies eight “strategies” that derive from it.

Let’s be clear: this article is 95% nonsense, and an embarrassment to HBR. Yet understanding just why it is nonsense is very instructive, and not initially obvious – even to John Oliver.  The problem has little to do with neuroscience itself – but everything to do with the logic of explanation.

Zak and his ilk are creating philosophical zombies. The only successful stake through the heart (to mix the horror genre’s metaphors) will be philosophical, not scientific. Here we go.

The Zombie Claim

A typical claim of the genre about neuroscience and leadership is as follows:

For many years, the science of leadership was considered a “soft” science. While many experts in management and business understood the qualities that made a good leader and knew the activities that could help leaders become even stronger, they didn’t immediately recognize the important link between the “hard” science of neurobiology and the “soft” science of leadership.

In the HBR article, Mr Zak says that his neuroscience studies reveal eight “strategies” which “effectively create and manage a culture of trust.”

Zak says oxytocin “causes” trust. (Always be wary of claims of causality). His own lack of confidence in this conclusion is evidenced by the fact that not one of his eight “strategies” includes dosages of oxytocin in the workplace.

The truth is: It makes as much sense to say Oxytocin “causes” trust as it does to say molecules cause car crashes. And neuroscience doesn’t “explain” leadership or management any better than do stories, strategies or similes.

The Zombie Mistake(s)

Zak et al make two important errors of thinking.

The language  problem. Mr. Zak himself describes his research as aimed at answering “the most basic question: Why do two people trust each other in the first place?”  The answer, he claims, is to be found in the biochemistry of the brain – in particular the action of oxytocin.

He claims that the best explanation – the best answer to a “why” question – must come from a particular “language” of human interaction; in this case, the language of biochemistry.

On simple reflection, this is far from evident. Why should the language of biochemistry be better at “explaining” trust than the language of management? Or poetry? Or analogy by stories? Or standup comedy?

In fact, the claim that biochemistry is the best “language” of explanation is no more sensible than the claim that French is better than German.

Any phenomenon, including human emotions, can be explained in an infinite number of ways. If I raise my hand, am I a) contracting my upper arm muscles, b) initiating a handshake, or c) offering a social gesture?

The answer is all the above, and many more. Which descriptor feels better is not a function of the underlying phenomena, but of the realm of reality I’m trying to describe.

The test of a valid explanation is not to be found in the language used, but in the usefulness of that language for the case at hand.

  • If the case at hand is pharmacological, and the desire is to create new drugs, then biochemistry is indeed the right language to use. Neuroscience indeed has its place, and this is one example.
  • But if the case at hand is to understand and affect managerial behavior, then the use of chemical language adds virtually nothing. (See below for why Zak’s eight ’strategies’ fit this description).

The reductionist problem. The reductionist problem in philosophy is the belief that the continued dissection of problems into ever-finer constituent pieces will always lead to ever-more profound understanding and explanation.

If Joe appears angry at me, I might explain it by breaking it down into our past history, what happened to Joe this morning, and what I just said to him a moment ago. This might lead to a most constructive response – an empathetic inquiry, aimed at calming Joe and keeping me from a punch in the nose. So far, so good.

But breaking it down further – describing Joe’s blood type, the tension in his musculature, his level of serotonin, the grammatical structure of what I said to him – is not likely to either help Joe or prevent my face-punch. Yet reductionist thinking insists this is necessary to fully ‘explain’ what is going on, or to identify the ‘cause’ of the phenomenon in question.

Just as in the language claim, the real-world usefulness of a particular explanation is not a function of the depth of description used, but of the phenomenon requiring explanation.  To explain most management behavior, you simply don’t need to get to the level of biochemistry. You’re better off with commonsense language that describes human interactions.

The Commonsense Approach to Trust: Reciprocity. 

Mr Zak himself – in passing – quite correctly points out the fundamentally reciprocal nature of trust. One party takes a risk, and the other party then returns that trust – or not. This is indeed a critical observation about the dynamics of trust – it is a reciprocating relationship.

But it’s a commonsensical observation, almost definitional – it is something we know by life, not something we need neuroscience to prove for us.

This fundamental truth was famously stated by Henry L. Stimson: “The only way to make a man trustworthy is to trust him; and the surest way to make him untrustworthy is to distrust him.” Ernest Hemingway said the same thing: “The best way to find out if you can trust somebody is to trust them.” It was well known to Abraham Lincoln (“The people when rightly and fully trusted will return the trust,”) and to Warren Bennis (“Trust is the lubricant that makes it possible for organizations to work.”) Mr Zak himself cites Adam Smith as having said much the same.

Neither Stimson, Hemingway, Lincoln or Bennis required neuroscience to validly know whereof they spoke. Yet they clearly understood the fundamental nature of reciprocity to the functioning of trust.

Trust “strategies.” Here are the eight “strategies” or “management behaviors” (he uses both terms) that Zak identifies:

Recognize excellence; give people discretion; enable job crafting; share information broadly; intentionally build relationships; facilitate whole person growth; show vulnerability; and induce “challenge stress.”

Zak derived these strategies from experiments and surveys that analyze the production of oxytocin in various situations, and then ‘tested’ the impact of those trust-inducing behaviors on business performance.

One doesn’t need to question the validity of either his experiments or his ‘tests’ to ask a much simpler question: what does this language add to our understanding of trust in business, compared to other languages?

Now we might ask: if you wanted to list strategies of reciprocation to enhance trust, what might you do?  You might:

  1. recognize excellence, which probably results in appreciation and more excellence
  2. give people discretion in their jobs, and see if they reciprocate positively
  3. enable job crafting, to which people will reciprocate by improving performance
  4. share information broadly, which probably drives reciprocal behaviors of sharing and intelligent use of that information
  5. intentionally build relationships, which results in yet more relationship-building
  6. facilitate whole person growth, which probably results in gratitude and performance
  7. show vulnerability, to which people reciprocate by sharing their own vulnerabilities, creating more trust.

That is: seven of Zak’s eight strategies (all but “induce challenge stress”) follow self-evidently from a simple pragmatic definition of trust as a human process of reciprocation. Indeed, we can add a few that he might have missed, e.g. thanking people for favors done, or recognizing emotional states in others.

In other words: Zak’s “strategies” are commonsensical, and derived from basic principles of human interactions that even he recognizes. Neuroscience adds nothing to their understanding.

 

Let me be clear. I’m not challenging neuroscience itself. In certain spheres (like medicine or pharmacology), understanding the role of oxytocin and other chemicals in our brain and on our behavior is important, even vital. Biochemistry is the “right” language for such endeavors.

But for other fields – in particular, business – the language of biochemistry is like knitting with mittens on. It is worse than useless because it promises much and delivers little. Other languages are better suited and more productive to understanding the challenges of organizing, leading and managing groups of human beings.

And if you didn’t do it the first time, go back and watch John Oliver’s take on the same issue (he gets down to business at about minute 10:00).

Can we get rid of this zombie idea yet?

So, You Don’t Have Time To Be a Trusted Advisor?

One of the more frequent comments I get in talking about being a trusted advisor is this:

“We’d love to practice all the things you talk about, Charlie, we agree with them all.  But, we just don’t have the luxury of the kind of time it takes to get there. There are too many other demands, and we just can’t spare that kind of time.”

True or False: It takes more time to be a true trusted advisor than it takes to do just a very good job of service delivery.

Just to be clear where I stand: that statement is as false as a three dollar bill.

Trust Doesn’t Necessarily Take Time

First of all, the old truism that “trust takes time” isn’t necessarily true. Only one of the four trust equation components necessarily takes time, and that’s reliability – because by definition reliability requires a track record.

The other trustworthiness components – credibility, intimacy, and low self-orientation – can be, and often are, assessed in a few moments.  We all form very strong first impressions of people about whether they are truthful, competent, paying attention to us, of high integrity, and so forth.  Furthermore, we’re generally pretty right in those impressions, or at least we tend not to modify them greatly.

But that’s only about a single instance of trust establishment. Let’s look at trust over time.

Trust Saves Time

The fact that trust can be established quickly is only the beginning. What happens after trust is established?

Most would agree that having a trusting relationship means that things go more quickly from then on; your word is taken as bond; your advice is heeded; processes proceed more quickly; there is less double-checking, and so forth.

So, do the math. Let’s say you’ve got ten interactions with a client, and in the first one, you establish a great deal of trust. The next 9 interactions will proceed more quickly, with deeper results, than if you did the dance of distrust every time you interacted. The aggregate amount of time spent is almost certainly less, not more, in the trustworthy case.  Trust doesn’t require more time, trust saves time.

In other words, even if trust took time up front, the investment is more than paid off in future interactions by a host of benefits. But even that’s not the end.

It’s Trust Quality, not Quantity, that Counts

If you had to invest time to create trust, the ROI created would typically be very positive; it drives lower costs of sales, better time to market, and so forth. But you don’t have to invest much time. Not if you are qualitatively excellent.

Imagine two equally competent and good-willed professionals.  Over the same period of time, one does high quality client work, displays excellence, and offers good value.  The other one does the same – but in addition, becomes highly trusted. If time were the only variable, then this scenario makes no sense – given equal time and equal everything else, they should be equally trusted.

But we all know that scenario is actually quite common – one professional is frequently more trusted than another, often with even less time invested. Why is that?  What are those highly trusted people doing?  Ask yourself that question about the highly trustworthy professionals you know.

Let me suggest they don’t get there by logging more hours – they get there by higher quality trust creation. They are authentic. They take emotional risks. They pay attention. They don’t focus on driving clients toward their own desired outcomes. They go where the conversation takes them. They freely admit their blank spots. Their goal is client service, not account profitability. Their highest calling is to make things better for the client.

They are fearless, humble, generous, curious, and other-oriented.  Those are the qualities that make them trustworthy – not how many basketball games they took the client to.

You don’t have the time to be a trusted advisor? In the aggregate, there may be a positive correlation between high-trust relationships and time spent, but you’d have a hard time convincing me that time caused the trust. In fact, I think it’s more likely that trust drives the length of time.

You don’t get to be a trusted advisor by logging hours. You get there by being more trustworthy. And not only does that not take more time, it actually takes less time.

Don’t let yourself off the trust hook; you can do it with quality, not time.

In Complex Sales, Time Is on Your Side

What’s the relationship of time to sales?

Should we worry that “time’s a wasting?” Or pay more heed to “all good things in due time?”  It sounds like a trivial question, but it’s got some far-reaching implications.


In late 1964, an English group calling themselves The Rolling Stones got their first U.S. Top 10 record with a song called “Time Is On My Side.” It was a cover version of a song previously recorded by Irma Thomas, among others. The lyrics loosely proclaimed that “you’ll come running back” because “I’ll always be around,” and therefore “time is on my side.”

The Stones, it turns out, were talking about selling professional services – and more broadly, about consultative selling in general.

If you’re relatively new to business development (the preferred euphemism in services for selling), you’ve probably read several books or articles, seeking wisdom on how to better sell. And if you’re an old hand at selling (and have no time for euphemisms), you’ve probably read even more of the same.

Nearly all of those books and articles make one key assumption. It is an assumption so basic, so simple, that we don’t even notice it. It is baked into the studies, the definitions, and the very language we use to describe selling. And yet that one assumption is so profound that it affects nearly every aspect of how we approach selling.

It is the assumption that a sale is a transaction. It is a discrete event. It happens (or in any case is closed) at a point in time. It is singular. The plural of “sale” is a series of “sales,” where the whole is equal to the sum of the parts. Sales happen one at a time. And time, generally, is not on your side.

Sales as Events

Consider the implications of that viewpoint. It suggests that a sale is an event with a beginning and an end. It suggests that we can understand sales patterns by averaging the sales events. It suggests that someone who is good at selling is good at making transactions happen. And it suggests that processes for managing sales will track these events through a sales process, attaching probabilities and sizes to each sale as the leads pass through the process.

That’s pretty much every modern-day CRM program, most sales metrics and sales management processes. The defining characteristic of those systems is that they’re built around discrete, separate events. In fact, we’ve talked ourselves into a mode of thinking such that we can’t conceive of managing sales without conjuring up behavioral, trackable events. If you can’t list an action and put a date on it – it doesn’t exist.

The sale event begins with a lead event, an initial contact. It proceeds through various exchanges of questions and answers. At some point there is a more or less formal proposal made by the seller. The end of the event comes when the proposal is either accepted, rejected, or ignored. At that point, the event is considered “closed.” The buying company, unit, or person may show up again, and they may go on a contact list. But when they show up again as a buyer, the seller will consider it a separate event.

When we think of sales as events, time is generally not on your side. Time is money. Time is the denominator in measures of efficiency. Time is what’s a-wasting when you’re spending your time unproductively, i.e. not selling. Time is the unit that determines your bonus, and it is what your manager is talking about when he says, “What have you done for me lately?”

Viewed that way, the world of sales is a series of discrete events. To borrow a metaphor from subatomic physics, the modern view of sales sees sales particles, not waves.

And yet—as in physics—we don’t have a complete understanding of things unless we view things from the “wave” perspective, as well as the particle perspective.

Sales as Patterns

Sales as events may sound blindingly obvious, but consider an alternative. What if a sale didn’t describe a discrete event, but a pattern of events, or a state of relationship, or a condition? What if a sale happened over time, with no particular event being more significant than others? What if a sale were about a relationship, not a transaction? What if it were an adjective, not just a noun or a verb?

We would view selling not as about executing isolated, separate transactions, but as relationships.

We would talk mainly about the quality of the relationship with a customer. Individual sales transactions would be seen as indicators of relationship success, not as the sole driving purpose.
Relationships and transactions would trade places as ends and means. CRM systems would actually measure relationships, not just transactions, thus finally living up to their name. Sales managers would coach people on furthering customer relationships, not on check-boxing behavioral events and driving transactions through the customer organization.

Is Time On Your Side?

A critical difference between the transactional and the relationship view of sales is the role of time. Transactions happen at points in time; relationships wax and wane over time. How you spend your time varies:

  • If you view sales as transactional, then you’ll want to maximize transactions over time and view relationships as a means to that end.
  • If you view sales as relational, then you’ll want to maximize relationships over time and trust that transactions will come about as a byproduct.

Note: in the long run, the metrics converge. The longer the timeframe, the more relevant is aggregate dollar sales. The critical question is this: do you maximize long-term sales by focusing on short-term transactions, or by focusing on long-term relationships?

For some businesses, long-term revenue pretty much equals the sum of the short-term results. Possible examples are convenience stores, Wall Street trading businesses, and online ad revenue. Here the transactional view of sales works just fine.

But for many other businesses – especially professional and intangible services, and complex and high-ticket B2B sales – the reverse is true. You don’t succeed by micro-focusing on transactions, by relentlessly improving efficiency, or by scrimping on time.

Instead, you succeed by focusing on the qualitative – by improving relationships, by nurturing the conditions that lead to repeat business, loyalty, deep customer knowledge and intimacy. In the not-very-long run, that focus actually produces better results than focusing on the transactional.

The Stones were right: time is (largely) on your side. If you are prepared to be consistent, trustworthy, focused on the greater good of your client, and not blinded by the shiny object of the Next Transaction, time becomes your friend. Your customers will indeed come running back—at least as many and as often to make it a superior sales strategy.

An Open Letter to Timothy Ryan, PwC’s US Chairman Re: Oscars and Trust

Mr. Ryan,

Some days as Chairman must be fun. Others, like the Oscars the other night – not so much.

I recognize you, in fact, know a lot about trust.  There are probably particular circumstances that make the Oscar boo-boo a unique event. You may also have taken some steps like those I suggest below.

But this is such a teachable moment for the area of trust recovery that I hope you’ll forgive my suggesting Three Steps that someone in your position should consider – on principle – taking.

 

Step One. Offer to resign the Academy account. Do so unreservedly and genuinely.

  • If they accept your resignation (they probably won’t), it looks better than being fired; and hey, it did happen.
  • If they reject your resignation, you will look gracious. (And why should they let you resign – look at all they just invested in training you!)

Step Two. Tell the Academy precisely what went wrong, and precisely what you’re going to do to ensure nothing of that type, flavor or category will ever happen again.

  • Then fund somebody to start writing a paper on what implications this event has for improving audit industry practices at large.

Step Three. If anyone dares to suggest firing the poor gentleman at the heart of this most unfortunate event, tell them what the Academy will hopefully tell you: “Why would we ever let go someone in whom we just invested so much in training?” He just became one of your most valuable future cautionary story-tellers.

One of the many paradoxes about trust is that trust recovered can often end up stronger than trust unchallenged.

I’m rooting for you.

 

 

 

 

Credibility, Trust and Ignorance

Being right is vastly overrated.

Now, that doesn’t mean that lying is a good strategy. What it does mean is that in the business world, we all too easily conflate trust with credibility, and credibility with expertise.

You don’t have to look too far to find big-name sales trainers and gurus who insist that it is expertise and insights that drive sales success and trust.

I first heard this mantra back in the 70s (and if I were older, I’m sure I’d know of earlier instances).

Well, here’s some truth. People don’t trust you just because you’re smart. And they definitely don’t trust you because you’re a smart-aleck.

In fact, smart is not even a necessary condition for trust – much less a sufficient condition. Further, the role of expertise and insight doesn’t come temporally first in selling – it plays a role in marketing, and then later a role nearer the middle of the sales process.

Credibility, insight, expertise, smarts – all these things do have a role. It’s just not what you may think.

Let me explain a bit further…

——

I long ago attended a sales call with my boss. When asked by the client, “What experience do you have doing this [narrowly defined] kind of work?” he shocked me by saying, “None that I can think of; what else would be useful for us to talk about?”

How is it that we come to influence other people’s ideas? How do we more effectively get others to take our advice? How do we sell more successfully?

The overwhelming answer in the corporate world seems to be, “By getting people to see that we have the right insights and answers.” But that response is very often wrong.

“Being right” turns out to be vastly overrated. Sometimes, even an admission of ignorance is actually a better strategy.

Misconceptions About Trust – How to Gain Credibility

Most of us think something along these lines: “They’ll take my advice (or buy from me, or be persuaded by me) if they think I’m credible. They’ll think I’m credible if I look smart, have great ideas, and have experience. Therefore I’ll tell them about myself, my bright ideas, and my track record at being smart.”

Clients contribute to this subornation by asking us to talk about precisely that (not because they care about the answer, but because they just don’t know what else to ask and don’t want to take the risk of looking foolish themselves).

But credibility isn’t the only element driving trust. And experience and smarts aren’t the only ways to get credibility. Think of the arrogance implicit in saying “let me tell you why I’m the best” before the customer feels you even know their situation. (This is a description of 98 out of 100 cold call emails you get from email “marketers”).

For example, consider humility. Being willing to acknowledge obvious ignorance creates rather than destroys credibility.  The ability to say, as my boss did, “I don’t know,” is an astonishing comment. It communicates ignorance, yes – but it also communicates radical honesty (who is about to doubt an admission of ignorance!).

  • It communicates a sense of self-confidence (“I am secure enough in my worth and my value to admit exactly what I do and don’t know”).
  • It communicates a clear customer-focus – it says, “You asked a good question, and you deserve a straight, no-spin-control answer. Here it is.”
  • It communicates a focus on the long-term – it says, “If this particular piece of knowledge is key, then I may not win this job; but by being always transparent about what I do know, clients will always know they can trust what I say.”

By contrast, leading with smarts alone just says, “I am a database with a protein user interface.”

The Role of Truth

The point is not to adopt a profession of ignorance as a tactic. Nor is it to pursue ignorance as policy. It’s to tell the truth. Your credibility is not just a function of expertise: it’s a result of a complex set of calculations made by someone when they decide whether to believe and trust you when you say something.

Even if people believe you—credibility—that isn’t enough to get you trusted. They must also trust your motives, your understanding of their situation, and your ability to empathize—as they see it.

True credibility comes from letting people see you as you are—not as you would wish they would see you. Transparency trumps expertise. The more you insist on how much you know, the less we believe you: “the lady doth protest too much.” The more willing you are to honestly admit your limitations, the more we believe you. It’s a paradox thing.

No one expects an advisor or salesperson to be perfect—we just want to know where their biases or blind spots lie, whether they know their own biases – and whether they’re capable of admitting them.

That way we can make up our own minds about how much to trust them.

Letting our clients make that decision is, itself, a driver of trust.

Selling from Inside Your Client’s Shoes

You know the phrase, “Walk a mile in someone else’s shoes.” It’s short for empathy, understanding the Other so well you can intuit what it feels like to take a long walk—wearing their footwear, no less.

Let’s adapt that idea to selling. What if you could understand your client so well that you could intuit how it feels to be sitting in their seat in a sales meeting, sensing every nuance along the way?

Shall we give it a try?

Sales Meeting Time T-minus-10

It’s 10 minutes before meeting time. You arrive early, and the receptionist ushers you into the conference room and offers you coffee. You nervously drum your fingers on the laptop you brought to introduce yourself and your firm to Claudio and Taciana. They are CEO and COO, respectively, of the relatively new marketing automation firm C3PX. You spoke by phone with Taciana to set up this meeting. You’re optimistic, marshaling your nervous energy as you mentally rehearse your key points for the nth time.

Claudio. Meanwhile, Claudio wonders if he has time to call his 19-year-old daughter at college. Actually, whether to call her at all. Things are not well between the two of them—they haven’t been since he and his wife divorced last year. Teenage girls can be so—difficult. And it seemed like she so often took sides with her mother.

Meanwhile, C3PX is doing well—sometimes too well. Claudio just signed another line of credit extension. The good news was the firm’s credit was good. The bad news is he wants to pay down some debt, but there was always a need to invest in some new software or process. The meeting in 10 minutes may be another example—a necessary expense, but not welcome in terms of cash flow.

Claudio hopes Taciana can take the lead on this. He’s been leaning a lot on her lately. Is he holding up his end of the bargain? Or is it welcome to her—a chance to grow into the business? But what if she’s growing too fast and taking over some of Claudio’s roles as CEO?

Taciana. Taciana is running late. She’s just finished a meeting with HR, and she is concerned the experienced hire recruiting program is short of target. She wonders if she’ll need to postpone the ops team call this afternoon until tomorrow, though she did that last week as well. Is she getting a little overloaded? Does it show?

Taciana has mixed feelings about this meeting. On one hand, she genuinely liked the phone call she had with you. She felt you sounded sharp, competent, and confident. But she can’t help worrying about your service offering.

Does C3PX really need your kind of service at this point in its growth? You offer some great services, but with them comes another level of complexity. Are the benefits worth it? Should they get along for another 12 to 18 months? What if some new technology comes along and leap-frogs your offering?

Also, is this going to be yet another Taciana-solo project? “Sure, I’m the COO,” she thinks, “but that doesn’t mean I have to do everything. Am I leveraged enough? Will Claudio think I’m empire-building if I try to delegate? But if I don’t, how am I going to get time to spend with my husband? We’ve been trying to get more time together; he has a demanding job, too. I hope Claudio takes the lead in this meeting.”

Sales Meeting Time T = 0

It’s time. You take a last look at your phone just as the door opens. In walk Claudio and Taciana.

You all smile and shake hands, then pass out business cards. You each reject offers of more coffee and strategically settle into your chairs, all the while smiling and uttering meaningless phrases in non-committal tones.

The meeting commences.

Like all meetings, it commences on multiple levels. There is the overt agenda to be discussed. There are first impressions, flooding each of you as you quickly take into account the others’ appearance, sound, bearing, and manner. Are you who they expected? What’s different? What does that mean?

And are they who you expected? What did you misjudge? What did you get right? Can you afford to focus on that and pay attention to what’s being said? Do they seem a little rushed? What does that mean? Are they going to sit through your deck, or should you skip it? When should you bring up price?

You can ask them to tell you a bit about their situation, but you can’t do too much of that. These days no one has time for someone who hasn’t done their homework. Yet neither can you waste time proving you’ve done your homework. What does it mean that they placed their iPhone next to them? And so on.

Behind the Scenes

The internal dialogue is endless—and that’s just yours! What about the dialogue inside Taciana’s and Claudio’s heads? How important is this inner cacophony? And what should you do about it? Ignore it? Address it? If you choose to address it, how do you do it?

The truth is those internal dialogues are not trivial. They are important. You need to address them. Most of all this is a great opportunity cleverly disguised as an awkward social moment. You can dramatically affect the whole sale, and the whole relationship, by how you conduct yourself in the first few minutes regarding these internal dialogues.

Small Talk Isn’t Small

The idle chit-chat we engage in is a potent social ritual. The point is not to find out that you both went to Ohio State or love basketball or have kids. Those are proxies.

The real issue at stake is whether they can trust you—in a very specific sense of that word. It’s what we call “intimacy” in the trust equation. Do they feel safe being who they are in your presence? Do you laugh at the right moments—with the right kind of laugh? Do you wince at the right statements—like when Taciana mentions meeting overload? When they say, “Tell us about yourself,” do you remember that mostly they’re just being nice and then turn the conversation to them?

Do you have the emotional courage to raise your eyebrows when Claudio says, “Teenagers—am I right?” and invite further comment should he choose to go there? When one of them raises price concerns, do you respond with curiosity and say, “Tell me what’s behind that concern?” Or do you reply with a canned defense of your value-for-price? Do you have the nerve to say, “I’m sensing a little bit of stress from each of you. Is this decision a source of concern to you?”

This isn’t about your value proposition. It isn’t about proposing challenging questions or asserting your qualifications. But it’s critical. The buyer/seller interaction is many things, but it’s first and foremost human. First impressions matter, and not just about clothes and looks.

What buyers want is to feel at ease, trusting, and confident they can be authentically themselves with you and not have to look over their shoulders when dealing with you.

Buyers make up their mind about this subconsciously, and they do it very quickly. Trust in this sense doesn’t take time; it takes courage, connection, and empathy. Don’t be afraid to let your guard down. Doing so shows others that can do the same with you from the get-go.

This article first appeared on RainToday.

Read Part Two of this post, here. 

Trust Takes a Long Time to Create, a Short Time to Destroy. Not.

There are two kinds of mistakes we make with trust. One is to trust mistakenly – the other is to fail to trust at all. One is a failure of commission, the other a failure of omission.

The former gets all the press – but it’s the latter that is the bigger problem.

Let me explain.

——

One of the bigger myths about trust this one: “Trust takes a long time to create, but only a moment to destroy.” There’s no need to name names here, but you can see examples of it here and here and here and here.

Here’s why that myth isn’t merely annoying, but positively harmful as well.

The Truth.

Let’s start with the truth. Most human relationships, like most emotions, take roughly as long to get over as they took to develop. Marriages or friendships don’t end overnight. There may be a flash point, a straw that breaks the camel’s back. But we cut slack for people we trust. We don’t dump them abruptly.

If trust were lost in a minute, many victims of relationship abuse would leave their abuser at the first incident; but things are often a little more complicated than that.

If trust died quickly, the SEC would have investigated Bernie Madoff when Harry Markopolos first lodged charges against him. If trust died quickly, the steady drip drip drip of evidence at Penn State, Enron, and Wells Fargo would have ended at the first drip.

Most examples of “trust lost quickly” turn out to be either just the last drip in a long series of drips – or a delusion about trust’s existence in the first place (you don’t “violate the trust” of a subscriber to your email list by sending them a worthless referral; the relationship you have with a name on your email list may be many things, but “trust-based” is probably a stretch).

Trust formed quickly can be lost quickly; trust formed at a shallow level can be lost at the same level.  But trust formed deeply, or over time, takes deeper violations, or a longer time, to be lost. The pattern looks more like a standard bell curve than a cliff.

But, you might say, so what?  Why is that harmful? What’s the big deal? 

The Harm.

If you believe that trust can be lost in a moment, then you likely believe you must be cautious and careful about protecting it. You are likely to think about trust as a precious resource to be guarded against being tarnished. You are inclined to institute rules and procedures to protect it and to give cautionary lectures about the risk of losing trust.

Yet these are precisely the kinds of behavior that result in trust lost.

I don’t trust the man who talks with me while pointing a gun at me‬ – partly because he looks threatening to me, but also because he clearly does not trust me.

Trust, at a personal level, is like love and hate: you tend to get back what you put out. You empower what you fear. Those afraid of getting burned are the most likely to get burned.

This works at a corporate level too. I remember vividly the convenience store chain that gave monthly lie detector tests to store managers to prevent theft – and then wondered why the theft kept on happening.

I recently heard from a company wanting to modify the Trust Equation by “toning down” the component called Intimacy to something more bland, like affability or good manners. Why? They didn’t want to be seen as encouraging employees to have sexual liaisons with customers. This falls in the same category with multi-paragraph email signature caveats, and the fine print on retail customer receipts. Fear of trust not only doesn’t save trust – it actually causes low trust.

Trust is a Muscle.

Thinking of trust as something you can lose in a minute makes you cautious and unlikely to take risks. But the absence of risk is what starves trust. There simply is no trust without risk – that’s why they call it trust.

If your people aren’t empowered, if they’re always afraid of being second-guessed, then they will always operate from fear and never take a risk – and as a result, will never be trusted.

Trust is a muscle – it atrophies without use. And the repetition of the mantra “trust can be lost in a moment” just tells people not to use it.

Turns out the stupidest, craziest trust is the trust you never engaged in because you were too afraid of losing it. The smartest trust is the trust you create by taking a risk.

Building the Trust-based Organization, Part II

In last week’s “Building the Trust-based Organization Part I,” I suggested that approaches to trust at the organizational level fell into several categories. Like the parable of the blind men and the elephant, all captured some part of the puzzle, but none grasped the entirety of the issue.  The five categories I listed were:

1. Trust as communication
2. Trust as reputation
3. Trust as recipe
4. Trust as rule-making
5. Trust as shared value.

I suggested a holistic approach would have a Point of View, a Diagnosis, and a Prescription.  Here is my attempt at offering such an approach.

Organizational Trust: A Point of View

Trust relationships are asynchronous – one party, the trustor, is the one who does the trusting, and who takes the risks. The other party, the trustee, is the one whom we speak of as being trustworthy (or not). “Trust” is the result of a successful interaction between these two actors.

Trust is largely an interpersonal phenomenon. Trustworthiness is mostly personal, though we do speak of ‘trustworthy’ companies as having a track record or being reliable. Trusting, however, is a completely human action, not a corporate one.

Risk is necessary to trust: if risk is completely mitigated, we are left only with probability.

It follows that the most powerful meaning of “organizational trust” is not an organization that trusts or is trusted, but an organization that encourages personal trust relationships:

A trust-based organization is an organization which fosters and promotes the establishment of trust-based relationships between various stakeholders – employees, management, shareholders, customers, suppliers, and society.

Organizational Trust: Diagnosis

What is needed to create a trust-based organization? Since ‘trust’ is such a broad concept, it’s clear that themes like communications, regulations, and customer relationships will have a role. But to avoid a mere laundry list, what’s needed is some kind of primus inter pares relationship; or perhaps some necessary vs. sufficient distinctions.

My nomination is simple: an agreed-upon system of Virtues and Values. Virtues are personal, and represent the qualities sought out in employees and managers. Values are organizational, and reflect basic rules of relationship that ought to govern all relationships within the organization.

Some typical trust-based virtues include: candor, transparency, other-orientation, integrity, reliability, emotional intelligence, empathy.

I have suggested elsewhere Four Trust-based Organizational Values. They are expressed below in terms of customer relationships just to be specific, but they apply equally to relationships with suppliers, fellow-employees, and so forth.

  1. Lead with customer focus – for the sake of the customer. Begin interactions with other-focus rather than self-focus.
  2. Collaboration rather than self-orientation. Assume that the customer is a partner, not in opposition to us.  We are all, always, on the same side of the table.
  3. Live in the medium-to-long term, not the short term; interact with customers in relationship, not in transactional mode. Assume that all customers will be customers in perpetuity, with long memories.
  4. Use transparency as the default mode. Unless illegal or hurtful to others, share all information with customers as a general principle.

Advocates for Values.  I am not alone in citing Values as lying at the heart of the matter.McKinsey’s Marvin Bower put values at the center of his view of business, and McKinsey for many years was run from his mold. As Harvard Business School Dean McArthur said of Bower, “What made him a pioneer was that he took basic values into the business world.”

In 1953, Bower said, “…we don’t have rules, we have values…”

In 1974, he wrote, “One of the highest achievements in leadership is the ability to shape values in a way that builds successful institutions. At its most practical level, the benefit of a managed value system is that it guides the actions of all our people at all levels and in every part of our widespread empire.”

Bower’s biographer noted that Bower believed that “while financial considerations cannot be ignored, business goals must not be financial; if they are, the business will fail to serve its customers and ultimately enjoy less profit.”

The alumni of McKinsey – some, anyway – learned well. Harvey Golub said, “[values are] a powerful way to build a business…it worked for McKinsey and it worked for IDS and for American Express.”

IBM’s Lou Gerstner said: ‘“I believe that I learned from [Marvin] the importance of articulating a set of principles that drive people’s behavior and actions.”

[Note: McKinsey itself had some noticeable hiccups post-Bower. In my view, this is not an indictment of values-based management, but a sad example of how it requires constant values-vigilance].

The Case for Values.  The use of values as the basis for management is well-suited to the subject of trust, and this advantage shows up in numerous ways.

  • Values scale, in a way that performance management systems never can do.
  • Values are about relationships, in a way that incentives never can be; this makes them highly suitable to the subject matter of trust.
  • Values are infinitely teachable, in a way that value propositions or communications programs alone cannot aspire to.
  • Values are among the most un-copyable of competitive advantages.

Organizational Trust: Prescription

Managing a values-based organization will center around keeping the values vibrant. This is pointedly not done mainly through compensation and reward systems, corporate communications plans, or reputation management programs. Instead, it is done through the ways in which human beings have always influenced other human beings in relationship.  To name a few:

  1. Leading by example: trustworthy leaders show the way to their followers by their actions, not just their words
  2. Risk-taking: trusting others encourages them to be trustworthy, and, in turn, to themselves trust others
  3. Discussion: principles undiscussed are principles that die on the vine. Discussion, not one-to-many communication, is key to trust
  4. Ubiquitous articulation: trust principles should underpin many corporate decisions and actions; trust-creating leaders seize the opportunity for teaching points in every such case
  5. Recognition: Public praise for values well-lived is intrinsically motivating
  6. Confrontation: Trust-building leaders do not hesitate to overrule business decisions if they violate values, and to do so publicly in ways that teach lessons. Values, not value, are the ultimate arbiter of all actions.

To sum up: it’s a simple concept. Trust in a corporate setting is achieved by building trust-based organizations. Trust-based organizations are built to consciously increase the levels of trusting and of trustworthiness in all organizational relationships. The best approach to creating such an organization is values-based management and leadership. This is different from most approaches to management and leadership in vogue today.

The quotes about Marvin Bower were taken from:
Edersheim, Elizabeth Haas (2007-12-10). McKinsey’s Marvin Bower: Vision, Leadership, and the Creation of Management Consulting. Wiley.