The Reverse Elevator Speech: Disaster and Recovery

Trust requires that someone take a risk. Perversely, that means the avoidance of risk is tantamount to preventing trust.

One of the hardest things to do is to recognize this need in the face of mundane, everyday interactions, where it always seems that taking a risk is inappropriate.

So rather than give a mundane business example, let me do this one by metaphor.

A British account executive years ago told me the following story:

“I was going to see a potential client for what could have been an important piece of business for us. Unfortunately for me, I missed the scheduled plane by minutes, and thus was delayed by an hour. I called, and they agreed to reschedule the meeting to accommodate me.

“When I arrived, a bit flustered, the team of a half-dozen clients execs had gathered downstairs, and we all then went to the lift to go upstairs to the designated conference room.

“Unfortunately the lift was made for about four people. We all crammed into the lift, and it slowly began to climb. At that point someone – how shall I put this – well, as we English say – passed gas. The lift continued its crawling pace upward. No one, of course, said a word, nor even altered their expression. There was dead silence.

“As the doors finally opened, we all rushed to get out – all at once. And all 7 of us thereby tumbled onto each other on the floor. We all picked ourselves up, even more embarrassed, and again without saying a word to each other, made our way into the conference room.

“As I set up at the head of the room, I could feel the weight of this triple discomfort: I was late, the tumbling all over each other – and of course the ‘gas’ incident in the middle. It was all contrived to create a mutual sense of misery.

“What to do? I stood in the front of the room and said, ‘Gentlemen, little did I know this morning what a fine level of intimate relationship we should all achieve in so little time here this afternoon. I am honored indeed.”

“Well, everyone fell all over each other laughing; I had somehow managed to prick the balloon of the unspoken that hung over us like a cloud, and the rest of the day went marvelously. And oh yes, we got the sale.”

What this gentleman had done, in our nomenclature, was to Name It and Claim It; that is, to speak aloud the one thing that no one could figure out how to talk about. He did it with humor – an excellent tool – and was rewarded for the relief he caused by an appreciative relationship, and even a sale.

So What?

Charming, you think, but quite beside the point. What’s it got to do with me?

Well, as it happens, I had another conversation just last week (with, as it happens, another Englishman). He was a business development manager, tasked with what felt like an impossible burden.

“The senior partner insists on bidding a job in a sector in which we frankly have no experience. Certainly far less than anyone else. And he wants me to pretend it just doesn’t matter, or to dazzle them with bluster, or in some way to just blow through it. It’s simply not going to work, and we’ll look the fool.”

Well, yes they’ll look foolish if that’s how they go about it. They don’t recognize the relevance of the reverse elevator speech.

The solution is for the senior partner to say something like this:

“You may be wondering why a firm with so little experience in this sector is even here pitching you at all today. Certainly I wondered it! But I assure you we don’t make a habit of tilting at windmills.

“There is an angle here that I fear conventional wisdom might not point out. We’ve seen it a few times before, and it can make the difference between a run-of-the-mill project and a truly game-changing solution.

“I simply could not let the situation rest un-addressed. And that is why I am here in front of you today. Now, what we see going on here is…”

You may have picked up that there’s a ‘catch’ here.  The catch is that you actually have to have something consequential to say. If you have nothing consequential to say, then you shouldn’t be there in the first place, and you deserve what’s about to happen to you.

But if you do have something to say, the surest way to strangle it before it sees the light of day is to deny the elephant in the elevator – the lack of relevant sector experience, in this case.

Hope, they say, is not a strategy. Hoping somebody won’t notice the obvious is a strategy-killer. In such cases, not to take a risk is the biggest risk of all.

Get credit for stating the obvious, for telling the truth, and for relieving the tension that everyone feels. Put it out there. That way everyone is leaning forward on their seats, waiting to hear the idea that just might be so good as to overcome the banality of traditionalism.

Take the risk. Call out the wind in the elevator. Like a vaccination, it amounts to taking a little risk to mitigate the much larger risk staring you in the face. And you’d be surprised at how often it works.

Client Service vs. Client Servility

With every technological advance in communications, we get another chance to negotiate the boundaries between good client service and client servility.

Where do you draw the line?

Better yet: How do you draw attention to a line that’s already there, if we think about it rightly?

Most client-serving organizations I know make a pretty big deal about client service. It is right at the top of their list of stated virtues. And rightly so.

But sometimes, things can get a little twisted.

What do you make of:

o The SDR who unquestioningly responds in detail to every detailed request, without adding perspective. Regularly.

o The project manager who video-cons the team on Sunday to re-work the slide deck. Regularly.

o The senior officer who drops in on the staff meeting to “show the flag” but leaves early because “when the client calls, you know…”  Regularly.

o The salesperson who cuts price at the drop of the hat when the client demands.  Regularly.

o The VP who cancels the cleanup position on the third round interview because, “I had no choice, the client changed the date.” Regularly.

o The manager who joins the training session late and slips out to take calls between scheduled breaks, because “we’re in the middle of a really tough time for the client – they need me.”  Regularly.

The key word is, of course, regularly.  Any one of those examples can be held up as a case of client heroism.  If, that is, it’s an isolated event. But if it’s endemic – then that’s not client service, that’s client servitude.

They are not the same. Great client service is being willing and able to behave in unusual ways when faced with unusual situations; and doing them selflessly, for the sake of the client.

Being servile is quite another thing. It means seeking out options to give faux service.  Terms related to servile include sycophant, suck-up, boot-licker, and toady.

We suspect those who are servile of dishonesty – of speaking falsely in an attempt at self-aggrandizement. Their motives are suspect; which means their credibility is at risk as well.

Ironically, their servility costs them in terms of respect from the very people they are most trying to impress.  Above all, we don’t trust such people.

If we’re honest – I’ll just speak for me here – if I’m honest about it, there’s always a tiny touch of servility lurking around the edges of most client service I perform.  It’s hard to be unaware of the value of being perceived as client-serving.

The trick is to not be overcome by a need for recognition. To do the next right thing, yet to be detached from the outcome; particularly whatever benefit clearly might accrue to me from doing the right thing.

This is the heart of it.  Client service is doing good for the client.  Period.  We are not surprised when we get credit for doing it.  But expecting good from doing it is Station 1 on the slippery slope; the End-Station is doing client service  in order to get credit for doing it.

That way lies client servility.

Most clients don’t want servants at their beck and call – they want equal partners at the table who can make a plan and stick to it; who have enough respect for themselves and their own firm that they will, on occasion, push back; who take the partnership seriously enough that they will keep their own team healthy enough to deliver in the long run, rather than burn it out in a never-ending series of faux client crises.

And if you really think you have one of those rare clients who actually wants servants – then put your money where your mouth is.  Give that client to a competitor.

Stop Measuring ROI on Soft Skills Training

Many, perhaps most, of our clients tend to ask us about how they can measure the returns from Trusted Advisor workshops. However, I suspect their reasons are a little opaque. More often than not, these buyers are already persuaded of the benefits. The potential clients who are truly skeptical are rarely the ones who actually call–nor are they likely to be persuaded, even by a hard-nosed ROI calculation. 

So – why are they asking?

Let’s tackle a garden variety corporate orthodoxy: the one that says your company shouldn’t do training without a measurable return on your training investment.

Variations on the theme: if you can’t measure it, you can’t manage it; all training must be defined in terms of behavioral objectives; each objective must link to behavioral milestones, each quantifiable and financially ratable.

Let me speak plainly: Subjecting soft-skills training to pure skills-mastery financial analytics is intellectually dishonest, wrong-headed, useless at best and counter-productive at worst.

There, I said it.

Now let me explain – and offer an alternative.

There are are sprinklings of truth in the rush to measure soft-skills ROI – but they are surrounding a germ of falsehood at the heart of the matter.

The ROI-behavioral view of training is fine for pure cognitive or pure behavioral skills. If your focus is on teaching Mandarin to oil company execs, mastering the report generation functions of CRM systems, or teaching XML programming, you can stop reading this now.

But if you’re talking about communications skills, trust, customer relationships, listening, negotiation, speaking, giving and receiving feedback, consultative thinking, influencing, persuasion, team-building and collaboration, then read on.  There are at least four problems with measuring “return” on these kinds of programs.

First problem: definitions. We evaluate golf coaching by lowered golf scores—neat, clean, unarguable. But try defining “good communication.” Or trust. Or negotiation. You might as well define the taste of water, or the quality of love. To accept behavioral indicators (“she smiles, she touches me”) is to miss an essence.

Second: causality. All causality is unprovable, though we know when to accept it anyway. “I had 3 lessons with a golf coach, and cut my score by 8 strokes. It was the coaching—you can quote me!”

But what if I take one course in trust, and another in listening. Suppose my sales go up next year by 50%. Which course did it? Or did my company’s 70% growth have something to do with it? Or my happy new marriage? Too many variables.

Third: the Hawthorne effect. (Or, the Heisenberg Principle in physics). Sometimes the act of measuring alters the measurement of the thing being measured. If I know I’m being graded on listening, I’ll do whatever it is I think that you think makes me look like I’m listening. Which destroys real listening.

If you hype net-promoter scores, many will game the scoring – thus reducing the genuineness that underlay the original idea.

Fourth: the perversion of individual measurement. Most soft skills deal with our relationships to others. The drive to individually behavioralize, then metricize, has the effect of killing relationships by focusing on the individual – an ironic outcome for relationship-targeting training.

Suppose a course teaches focusing more on the customer, listening, helping others achieve their goals, helping teammates grow – worthy objectives, found in many programs.

The usual reason to define those results financially is to evaluate them financially. Thus someone – somewhere between the CEO and the person getting trained – is responsible for deciding to do more, or less, relationship-building programs – by using short-term individual measurements, often with short-term incentives.

Hence the perversity: training people to focus on relationships, by measuring and rewarding them individually.

“The more unselfish you are, the more money we’ll give you for being unselfish.
“The more you get rated as providing ‘excellent customer service,’ the more we’ll pay you” (which leads to pathetic begging by CSRs)
“The more you focus on others, the more we’ll pay you.
“Quick, get over here, I want to genuinely listen to you so I can raise my quarterly bonus and get promoted.”

Raise this perversity to the level of an industry over decades, and you can understand why pharmaceutical and brokerage companies have accrued such low ratings on trust.

So what’s the answer? Simple. And you don’t even have to give up your addiction to metrics.

Just measure subjective rankings.

Ask people these simple questions, over time:

1. Would you do that training again?
2. Would you recommend others attend?
3. Would you include it in your budget?
4. How do you rate that training compared to these other five programs?

You can run regressions, chi-squares and segmentations on that data to your heart’s content – as long as it’s measuring subjective data in ranking terms. Just stop trying to monetize interpersonal relationships by measuring ROI on soft skills training.

And for those of you still interested in seeing some data – I recommend our Trust360 multi-rater assessment tool. It’s not going to measure your ROI from a soft-skill training, but when you run a program as a before and after, you’ll be able to see and track key, measurable changes and improvements as a result of a soft-skill program. We recommend running a Trust360 in advance of a program and then again, for the same group, about 6 months later. Our clients who have done so have seen measurable results that still focus on the changes in soft skills, how the program and the Trust360 provided key insight to allow participants to really get to the root of the trust-building in relationships.

Give it a go – talk to us about it. What’s the downside?

 

How Trusted Advisors (Should) Think About “Business Development”

When you think of business development, what is the first thing that comes to mind about the purpose behind it?

If you thought “to drive sales,” then this post is for you.

It’s a special kind of person who finds his or her way into an expertise-based advisory career. They are, of course, what we call “smart”—meaning cognitively talented, analytical, with high IQs. They are also often driven, motivated, and high achievers.

What doesn’t get mentioned as often is that they also tend to have high standards—for their work, and for themselves. These high standards are reflected in ideas like devotion to customer service, ethical behavior, and commitment to quality.

And if there’s any one thing that feels contradictory to all those fundamental beliefs, it is probably business development.

I don’t know a single professional who started out wanting to be in ”business development.” For starters, the phrase itself feels like a contrivance. Isn’t “business development” just a softer word for ”sales?” (Note it’s even phrased in the passive voice, to distance itself from “develop business”).

Customers, we believe instinctively, resist being ”sold.” The dictionary is loaded with secondary and tertiary meanings of “sales” that suggest selling is manipulative, conniving, even morally offensive. Our customers work from that dictionary. They tell us—and we want to believe—that they buy from us because of our quality and our ethical devotion to service.

That’s what it means to work in a meritocracy, and a big reason we signed up. If customers don’t buy from us, it was because someone else beat us on quality and expertise. (Or, of course, on price). And again, that is what our customers tell us.

This is why the ”business development” professionals’ message is so distasteful. They seem to suggest that customers don’t buy on quality and price; that having the best expertise doesn’t guarantee the sale. And that, worst of all, customers are making buy decisions based soft criteria and emotions, and not being honest with us, or even with themselves, about it.

The whole matter is profoundly distasteful. We don’t like to think that we’re selling our time for money to begin with. We particularly don’t like to think that people are buying us for reasons other than expertise. And we recoil from being lumped together with car salesmen in such obfuscatory phrases as “business development.”

What’s a poor professional to do?

The answer—amazingly—is at once simple, profound, and easily accessed. It lies in fundamentally redefining the purpose of business development, beginning in our own minds.

The Purpose of Business Development

For most people, the purpose or goal of business development is obvious: to get the customer to buy something. Indeed, that’s what most people believe, which is precisely the source of the problem. It all starts there, and heads downhill fast.  Here’s why.

Those who believe the purpose of business development is to get the customer to buy have made three key assumptions:

  • That the purpose is one-sided, meaning all about the business developer.
  • That value to the customer is per se irrelevant, as long as it’s enough to result in a sale.
  • That the process is essentially competitive, and you fail if you don’t get the result, whether the loss is to a competitor or to the ubiquitous DND (Did Not Decide).

Those assumptions just fuel customers’ paranoia. They enforce the notion that business developers do not have their customers’ best interests at heart, that ‘the deal’ is all that matters, and that you can’t trust anything business developers say. It’s the kind of attitude that fuels traditional sales wisdom like “buyers are liars,” and “there are no be-backs.”

And those are just the key assumptions. There is a host of secondary implications which also follow from believing the purpose of business development is to get the customer to buy. For example, it suggests that efficiency is key—that business developers should work to qualify and prioritize their leads so they don’t waste unproductive time. For example, it suggests that you should be very careful about giving anything away. And especially it suggests that you should never, ever refer a competitor.

All of these are equally pernicious beliefs. It’s easy to characterize them as just traits of used car salesmen, but they’re taught in many ways by well-respected business development programs. Of course, that doesn’t make them better. They are still the source of all the negativity held by so many about business development. Softening the word doesn’t change the truth; “sell” is usually a four-letter word no matter how you spell it.

Fortunately, there is great news: It doesn’t have to be this way.

The Striking Alternative: A New Mindset

Try this simple statement on for size:

The purpose of business development is to improve the customer’s outcomes

There, does that sound more comfortable?

But wait! There are radical implications. It means, for example, that if the services don’t improve things for the customer, then you shouldn’t sell it to them. That’s a little bit radical.

Much more radically, it means that if a competitor truly has a superior solution for a given customer, you as the business developer should actually recommend the competitor. (Rest assured that the willingness to do so endears you so strongly to the customer that you’ll virtually guarantee future sales).

But even those aren’t the really radical implications. The Big Implication is that— properly conceived—there is virtually no difference between professional, high quality, ethical delivery and professional, high-quality, ethical business development. Why? Because both aim at improving the customer’s outcomes.

The Freedom to Be of Service

It is liberating to think of business development this way. It means the best way to generate new work is the same as the best way to execute on existing work: by giving samples, by helping them define the real problem, by being open and candid about … everything.

Let’s draw out the implications of this view. See if you agree to the following two statements:

  1. “I have a professional obligation to point out issues and opportunities to my customer that I can see and that I think would be of benefit to address.”
  2. “If those issues or opportunities aren’t obvious to the customer, I have a professional obligation to explain them so they become clear.”

If your answer is “yes,” then not only have you agreed that you have an obligation to develop business, but you have succeeded in re-defining business development in an ethical and customer-focused manner. You’re doing it for them, and for the same reasons you deliver high quality, ethical, customer-focused project work. You’re just not getting paid yet.

Paradoxical Results

When you see the purpose of business development is to improve the customer’s outcomes, things change fundamentally. Your goals are no longer in conflict with your customer; they are precisely and profoundly aligned. Your customers have every reason to trust you. And the new work becomes not the goal, but a byproduct.

Here’s the ultimate paradox: If you re-conceive the purpose of business development in this way, your customers will recognize it very quickly—even instantly, in some cases—and be more inclined to give you opportunities to be of service.

Your very willingness to forego the “sale” actually increases the likelihood that they’ll “buy.”

There is one catch: You can’t work the paradox against itself. You actually have to be willing to forego “developing business” as your objective in order for it to come true. You have to mean it. After all, you can’t fake trust.

But then, why should you even try?

Competing with Colleagues

When I wrote The Trusted Advisor with David Maister and Rob Galford, it became reasonably successful within several months. (Amazingly, it still ranks #11,014 – as of this morning – on the list of all books on Amazon. That’s all books, including Harry Potter (#218), Capital (#16,000), etc. I’ll take long-sellers over best-sellers any day of the week).

With its success came a happy problem: how to parcel out the leads between the three of us? Let me be clear, the book wasn’t drowning us in leads; any one of the three of us could have happily fielded all inquiries. And while we wanted to be fair to each other, we were also all of us very clearly in competition with each other.

So the question: how do you compete with colleagues?

Competing with Colleagues

What if one of us got a lead based on the book? Did we have any obligation to pass it along to the other two? If so, how?  Should we establish a quota system, whereby each of us would get every third lead?

Should we let the market dictate things, and let whomever the client had reached out to handle the response? What if the client had written to all three of us?  Should we all respond confidentially, or in some sense share our responses?

The problem was not unique to us, though it seemed so at the time.  You may face a similar problem within your organization – who gets the lead? Who gets to present?

Or, you may come face to face with an  old friend who has changed uniforms and now works for a competitor. In any case, the tension is much the same – the sensation of being a colleague feels intensely in conflict with the sensation of being a competitor.

How do you resolve it?

The Solution

The answer to the problem came to us fairly quickly, on reflection, and I documented it as part of the Four Trust Principles in my later books. The answer lies in true focus on client needs.

In our case: we agreed that we should all respond similarly to all client inquiries, regardless of to whom they were addressed. In all cases, we would say words to the effect of:

The Trusted Advisor was written by the three of us. I suspect that each of us could do an excellent job in response to your query, and each of us would handle the work slightly differently. You would be best served by having discussions with each of us, and making up your mind on that basis.

We will each be candid with respect to our own strengths and weaknesses, and answer questions to the best of our ability about the others. Each of us will respect your decision, and we are each committed to you making the best decision possible for you.

The best decision for you is what all three of us seek, and each of us will do our best to help you reach it, regardless of your choice.

This solution made everything easier. It kept our relationship collegial. It removed any awkwardness about responding to clients. It removed any awkwardness that clients might experience in choosing whom to talk to.

And, of course, it resulted in the best decision for clients, as each of us have our own particular skills and drawbacks.

So what’s the answer?  Grindingly relentless focus on client service, and the willingness to pursue that logic wherever it leads.

Is Trustworthiness a Moral Value?

Every day, I’m a little bit blessed by the interest and the thoughtfulness of our readers. Here’s an excerpted email that got me thinking.

The Email

Dear Charlie,

I took your free Trust Quotient (TQ) assessment. As I read it, the survey is presented as an evaluation of individual trustworthiness based on, among other things, credentials and one’s certitude in advancing a position based on one’s special knowledge.

To me, that’s not a measure of trustworthiness, but of perceived self-worth as measured by credentials and salesmanship.

I think of trustworthiness as a moral value.  I sense the value being measured in this test is not trustworthiness per se, but how deeply we identify with the importance of expertise and credentials, and how well we convince others of our personal trustworthiness by those same tokens.

Reader X

My Response (partial)

Dear Reader X,

Thanks so much for taking the time to express your thoughts. I suspect you and I are in complete agreement about trustworthiness as a moral virtue.

However, I think you misunderstand the TQ in a couple of ways – regarding the use of the quiz, and regarding the idea of credibility.

Trusting the TQ

The TQ is first and foremost a self-assessment. If the results were used by third parties, for example for hiring or aptitude testing, it would render them useless, because it’s simple to skew the answers so that others would see it in a way the test-taker wanted to be seen.

However, if no one else sees it, then test-takers would only be fooling themselves and destroying a chance to build self-awareness.

Salesmanship Does Not Drive Trust

You suggest that the TQ assessment is “not a measure of trustworthiness, but of perceived self-worth as measured by credentials and salesmanship.”

A look at any recent survey shows trust has gone down. I suspect you might agree, however, that what passes for “salesmanship” has probably gone up. That, I suggest, is prima facie evidence that people perfectly well know the difference.

Does excessive “salesmanship” drive down trust? Of course it does.  You can see it in every factor of the Trust Equation, the theoretical model underlying the Trust Quotient.

When you run into a hustler or con artist:

with respect to Credibility―

    •     you don’t believe his words
    •     you don’t believe his sincerity
    •     you doubt his expertise and credentials

with respect to Reliability―

    •     you want to see outside verification: “Show me the CarFax!”
    •     you require legal contracts
    •     you examine track records

with respect to Intimacy―

    •     you hesitate to trust him with your private information
    •     you suspect his motives in trying to get close to you

with respect to Self-Orientation―

    •     you suspect he’s entirely in it for himself
    •     you see that when he pretends to be focused on you, he’s faking it.

Every part of the Trust Equation works in that case to show precisely how we do NOT trust such a person. This equation doesn’t suggest untrustworthy behavior – on the contrary, it provides the diagnostic tool to describe and identify such behavior.

Trustworthiness and Morals

I personally don’t think you can have morals without relationships – because morals have to do precisely with relationships. (Robinson Crusoe had no need of trust, or ethics – at least until Friday). And just as the least trustworthy people are those who violate relationships by lying, bullying, and trying to hustle people for their own ends, so likewise are the most trustworthy people those who honor the Other in their relationships.

That means those who:

  • are honest about what they know and about what they don’t know
  • put their knowledge in service to the Other rather than to just looking good
  • can keep confidences
  • play in the long-run relationships game, not in the short-run transactions game.

Your comments fascinated and engaged me. I thank you for your passion, and hope you’ll forgive my reacting passionately as well.

Charlie

This particular reader chose to opt out after the free portion of the TQ because she felt it was contrary to her view of trustworthiness and morals. Too bad, because I think if anything, the opposite is probably true. As a result she missed out on some really cool stuff about the TQ:

  • The Trust Temperaments—the six psychological categories that describe how you go about being trusted
  • Most importantly, very practical, extensive suggestions about how you can improve your trustworthiness.

Have a look for yourself: the full version of the TQ is free, as are the basic results. And if you choose, you can pay us a few bucks extra to get the fuller, more expanded version of the report.

Why the Talking Stick Creates Trust

The morning news is celebrating a minor triumph of civility in the United States Senate. Senator Susan Collins helped broker a (very) short-term deal by using a talking stick – a centuries-old example of early social engineering from Native Americans.

What’s interesting here is not the agreement itself, but how the use of the talking stick creates trust.

The Nature of Trust

Interpersonal trust is a bilateral, reciprocating relationship based on risk-taking. Let me unpack that in simple English.

Trust requires a trustor, and a trustee. The trustor initiates the relationship by taking a risk. The trustee then responds, or not, by being trustworthy. The players than reciprocate roles – it becomes the trustee’s turn to be the trustor. And so on.

As a visual metaphor, think of a simple handshake; one person extends their hand – the other (usually) responds in kind. A minor social ritual, but of the type that plays out dozens of times a day in simple respectful, reciprocating gestures. It is the stuff of etiquette, among other things.

The Critical Role of Listening

Trust formation follows the rule of reciprocity – but what is the currency of that reciprocity? A powerful component of it is very basic – listening. As in, “If you listen to me, I will listen to you.”

This is a familiar proposition to all of us. In sales, we have “I don’t care what you know until I know that you care.” In fields as diverse as hostage negotiation, terrorist interrogation, and suicide hotlines, we know the critical nature of listening in order to ensure the other person feels heard. (In the field of relationships, you’ve probably been on one end or the other of the familiar line, “Would you stop trying to solve the problem, I just want you to listen to me.”)

I’m not talking about “active listening,” or listening to find out the other person’s position, or to formulate a value proposition. I’m talking about something much more basic and fundamental – listening so that the other person feels heard, validated, understood. This is primal stuff.

The Talking Stick

What the talking stick does is to ritualize this fundamental human truth. The only person allowed to talk is the one holding the stick. The result – even though everyone ‘knows’ that it’s an artificial constraint – is that it works.

We are hard-wired to appreciate the civility of listening – and to respond in return. The talking stick is a physical reminder of a basic rule of trust creation: the critical role of listening. If you let me talk about my issues, I will then let you talk about yours.

It’s a rule all humans seem to respect; and a clever vehicle, even if transparent, for drawing on our better natures to create trust.

 

Leadership, Trust and Intangible Services

Where do you draw the line between general best practices and vertical industry-specific applications? The answer, of course, is it depends. Specifically, it depends on the best practice, and on the industry. But what does that mean in the general case of leadership, and the specific industry of complex intangible services?

——-

Think of all the books on leadership in business. Now think about the leaders those books routinely cite as examples. Jamie Dimon may come to mind. Other names might include Jeff Bezos, Neil Armstrong, Ray Kroc, Pat Reilly, Steve Jobs, Walt Disney, or Jack Welch.

Now take this simple test. Imagine Jack Welch running a consulting firm. Imagine Jamie Dimon as CEO of an accounting firm. Ray Kroc running a law firm? Bill Belichik at an actuarial firm? Steve Jobs a commercial banker?

If these combinations sound a little “off” to you, there is a reason. Leadership is not a one-size-fits-all proposition. Most writing on leadership assumes a single definition of “business.” But leaders in certain businesses look decidedly different. Among those distinctive businesses, I would suggest, are retailing, high technology – and complex intangible services.

Intangible services firms often waste considerable time and effort in management development – and in management itself – by focusing unduly on leadership themes that are not business-relevant. Why? Because of the unconscious belief that there must be leadership “best practices,” and therefore what’s best for Apple/IBM/Amazon/Goldman must be best for everyone else as well. But the truth is, if Jeff Bezos is king, it’s only of one particular kingdom.

For complex intangible services, relative to industry at large, some leadership traits are more important – and some less important. The relatively more important themes are trust, coaching and values. Among the relatively overrated are vision and rewards systems.

GALP (GENERALLY ACCEPTED LEADERSHIP PRINCIPLES)

The list below shows the results of an unscientific quick scan of the business leadership literature. There are fifteen topics, arranged alphabetically. Most if not all these topics fall within four components of leadership identified by Warren Bennis, probably leadership’s top guru – vision, communication, trust, and personal characteristics.

LIST OF LEADERSHIP TRAITS: VARIOUS SOURCES

  • Charisma
  • Coaching
  • Credibility
  • Expertise
  • Implementing consistent systems
  • Inspiring people to greatness
  • Integrity
  • Leading by example
  • Organizing for flexibility and responsiveness
  • Personal development
  • Story-telling
  • Team-building capabilities
  • Trust
  • Vision
  • Values

The two “biggies” in leadership for industry at large may be vision and alignment. Vision is critical for leadership in many businesses. Without the compelling vision of an original leader, what would have become of Apple, Microsoft, McDonald’s, Amazon, and WalMart? Roberto Goizueta, as Coke’s CEO, gave a perfect example of leading by vision when he spoke of “a time when every faucet is used as God intended.”

Alignment is the other major leadership theme – alignment of message, rewards, incentives, measurement, and examples of leadership behavior. This focus on alignment is similar to the focus on vision in one respect – each is about the relentless reinforcement of a single, central theme, critical to the organization and its strategy.

Pick your metaphor: leadership in industry at large is like a) turning an aircraft carrier, b) being trail-boss on a cattle-drive, c) playing 3-dimensional chess, d) all the above. Leaders combine high-level direction-setting with the coordination of tactical complexities – relentless reinforcement of a theme.

Are all those key? Yes – for industry at large.

WHY LEADERSHIP IS DIFFERENT FOR INTANGIBLE SERVICES

By contrast, the dominant metaphor for intangible services businesses is widely accepted – it’s herding cats. And that calls for very different leadership.

The list below itemizes differences between industry and intangible services. Leadership in industry, of course, focuses on tangible “things” – markets, products, technologies, competitors, market shares, brand images, placement, positioning.

But intangible services are about abstractions, and about managing relationships to get there. They’re about process, not endpoints. The focus must be more on client service than on market share or competitive triumph. Every product/customer experience is non-trivially unique. Perfection is not about zero-defects, but about unbounded excellence – and excellence has no upper limit.

The relevant sports metaphor is not football, but solo sports like baseball or basketball. Professionals are, by and large, more driven, intellectual, internal, needy, hard on themselves, abstract, aloof, sensitive, and neurotic than their general management brothers and sisters.

In industry, strategy generally drives organization. In complex intangible services, strategy is as much driven as driver. An accounting firm may “decide”  to invest in M&A work; but the real driver behind the “plan” is inevitably a partner or two who have a personal passion for the work.

Visionary leadership is great for a Coke, GE, et al. “Be number one or number two in every business we are in” means something in a business like jet engines, where the top player of 3 may have 50% market share. It’s less useful in consulting, banking or law, where there are hundreds of competitors, where the professional is the product, and every client/professional experience is unique.

COMPLEX INTANGIBLE SERVICES: DIFFERENCES

  • No physical product
  • Smaller organizations
  • Far greater individual autonomy
  • More matrix or practice management
  • Higher average salaries
  • Professional/staff, not non-exempt/exempt
  • Fewer direct reporting lines
  • Lower levels of industry concentration
  • Certification driven expertise (CPA, JD, etc.)
  • Less history of branding
  • Apprentice system of personal development
  • Less functional specialization re selling
  • More fluid, ad hoc teams
  • No upper limit to quality (e.g. no 6-sigma)

DEVELOPING LEADERS FOR INTANGIBLE SERVICES

In complex intangible services, visionary leadership is overrated. The best leaders inspire not by the relentless reinforcement of a theme, but by demonstrating a passion for client service. A vision is an idea – client service is an attitude. Visions are about goals; client service is about mindsets.

Leaders in industry capture attention; leaders in intangible services celebrate paying attention. In this one respect, intangible services businesses are more values-driven than other industries. I don’t mean social virtues, but values like client focus and collaboration.

Measurement systems also matter less. When every client situation is unique, the apprenticeship model applies; leaders must focus less on refining measurements, and more on getting the right people to do the right things – often despite the measurements, not because of them.

Leadership is less systemic and more personal. Cats are un-herdable – that’s the point of the joke. But they can be led, precisely by appealing to their cat-ness. Great leaders help people to grow, to replace their fears by cultivating curiosity, to subordinate their egos to client service, to dare to be great and constantly challenge themselves – to gain the ability to trust, and earn the right to be trusted.

Finally, leadership in intangible services is mainly about personal growth. That is not a platitude. In a business where every client/service delivery event is unique, personal growth is a strategic sine qua non. Not growth as a generic leader – growth as a human being.

A leader of cats can’t just be the Greatest Cat: (s)he has the be the one who best understands cat-ness.

Do You Trust Your Customers? Do They Trust You?

It’s popular to claim that “trust is down.” Mostly, that’s true. It’s definitely true that trust in government in the US has declined. It’s a bit less true of big business, but not enough to be proud of. Edelman basically has it right: trust is broadly on the decline.

This is mainly a business blog, so let’s focus there. My clients have lots of questions about trust, ranging from what to why to how. But most of them have one question about all others: How do we get our customers to trust us?

It’s the wrong question.

——–

A long time ago, at least as we remember it, we all had more control over our businesses and our lives. Not everything we wrote would appear instantly on the Internet. We didn’t need to mention price until we had discussed value. We largely controlled our public image.

Back then, it wasn’t hard to trust our customers. After all, we held all the cards. And our customers more or less trusted us because we appeared trustworthy.

That was then; this is now. Information now is drastically, radically free. Copyrights and trademarks are losing their protective power, and first-mover advantage lasts a nanosecond. Your brand image is determined by forces outside your control.

Nowadays it’s hard to trust our customers. They can integrate upstream, threaten us with reverse auctions, switch suppliers in a heartbeat, force us to deal with procurement, and screen us out of every advertising and promotional channel we can think of. Worst of all—they trust us less than ever before. The ingrates!

In such an environment, the natural response is to tighten control. That is precisely the wrong response. The right response is not to stand in front of the wave, but to get out your board and surf it. And ironically, the best way to get our customers to trust us may be to trust them first.

Ways We Control

Given the volatility in nearly every aspect of business over the past decade, we don’t need more scary headlines. We are all overly conscious of terrorism, intellectual property theft, out-of-control jury awards, computer hacking, identity theft, and unscrupulous business practices. The fear factor is more than adequately taken care of just by reading the headlines (online) or watching the evening news (cable, delayed so as to strip ads).

We have responded with controls. We put screens and filters on our email, phones, and social networks. We use password protection programs. We instruct our lawyers to include non-compete clauses. We require our subcontractors and customers to indemnify us against all conceivably imaginable negative events. We engineer our CRM systems to include sub-routines to cover all possible downsides to the sale.

AI and Big Data are bringing new dimensions to this dynamic. We no longer have to trust our customers to tell us what they want: we can discern it from their behaviors, from scraped data. Increasingly we can divine intentions, rather than having to trust what our customers themselves say.

We do all this to manage risk. But when we expend so much energy on the negatives, we tend to mistrust everyone—customers, employees, subcontractors, strategic partners. And the result of all that mistrust is—mistrust handed right back to us. Trust is, after all, reciprocal: what you put out, you get back.

All the stats about the decline in trust tend make us think we’re seeing a decline in trustworthiness. Often that’s true, but it also implies a shift in our propensity to trust. We have become, as a business culture, less willing to take the risks that are necessary to building a trust relationship. And when we trust less, we get less trust back.

The Dynamics of Trust and Trusting

We sometimes forget that a relationship of trust requires two players: one to do the trusting and one to be trusted. Those roles are very different, and the players have to switch back and forth between them.

All the risk lies with the trustor, the one doing the trusting. By contrast, the one being trusted (the trustee) has a largely negative task: to not appear untrustworthy. But, if all the trustee does is appear trustworthy, and never take any risks, eventually the trustor will become suspicious: “Why am I always taking all the risks here?”

Healthy trust relationships are composed of an ongoing ever-reciprocating pattern of trusting and being trusted, with the roles frequently shifting. I reach out my hand in a gesture of greeting, risking your disapproval, and you return the gesture by shaking my hand. You share some important information with me, risking my abuse of that information, and I return the gesture by ensuring that I will treat the information appropriately. It is the back and forth that forms the pattern of trust.

Trusting Customers and Trustworthy Customers

Henry Stimson is credited with saying, “The only way to make a man trustworthy is to trust him.” Other pieces of received wisdom echo the same principle: “Whether you expect good or ill of someone—that’s what you’ll get.” “No pain, no gain; no risk, no return.” But what does all this have to do with customers?

Plenty. Let’s take buying. In the old days, we controlled the information and doled it out when it suited us to suit our sales process. Buyers know they no longer have to put up with that; they can put together almost all the information necessary on their own if they have to. They now resent having to deal with salespeople to get information that should be available on the web.

So, trust your customers. Put all your information out there on the web for your customers to see. Don’t force them to wade through salespeople to get it. Instead, use those salespeople to respond to intelligent questions from customers who arrived informed on their schedule.

Don’t force your “customer service” on customers. They no longer believe “your call is very important to us” or “our menu has changed,” and they can’t stand having to repeat their problem at every step of a convoluted process built because you don’t trust your employees and reverted to low-cost automation. Instead, invest in educated, empowered, always-available support.

Don’t hold back on price until value is established. Get price out in front; trust your customer to be smart enough to ask you value questions to determine whether the trade-off is good. Don’t try to “close” your customers. That’s just another form of control. Instead, trust them to make an intelligent decision, and help them by providing useful questions.

Don’t force your customers through returns hell. Take their word for it that the jacket didn’t fit, it wasn’t the right book, or they already paid for the software.

And while you’re at it, trust your employees. Don’t start the employer/employee relationship by threatening them with lawsuits if they ever leave and try to work for a competitor. Don’t sue people who “steal” clients from you (what do you mean “your” client, anyway?). Above all, listen very carefully to them. They’re the ones who can tell you what customers are talking about.

Back to the Most Common Trust Question – How do we get our customers to trust us? By changing the question. Channeling Stimson: the best way to get customers to trust you is to first trust them.  Try focusing instead on asking, “How can we find ways to trust our customers?”

It’s not the latest insight. In fact, it may be the oldest. But it still works.

Trust, Inc.

Walgreens, the venerable (116 years old, second largest) US drugstore chain, has announced a new tagline as part of a new brand positioning strategy.  No longer will it be “At the corner of happy and healthy” – the new mantra is “Trusted Since 1901.

Well.

I wish Walgreen’s nothing but the best, and don’t doubt their good intentions. Nor are they necessarily wrong on the facts. And, Walgreens is hardly alone in wanting to trumpet their levels of trustworthiness, or their trusted relationships with customers.

However, the use of “trust” in corporate branding is problematic on at least three dimensions. Walgreens provides a good opportunity to explain why.

Cognitive Dissonance

I always tell people not to call themselves a ‘trusted advisor,’ and certainly not to incorporate the phrase into their advertising. It’s like saying “humility is my best quality.”

Trustworthiness is something of a virtue, and calling yourself virtuous just explodes the claim. It’s wonderful when other people use trust to describe you or your relationship with them – as long as it’s them saying it. (“Trust me” may be the two most trust-destroying words you can say).

Calling yourself ‘trusted’ is also different from calling yourself innovative, or respected, or high quality. Walgreens might want to take note that none of the ”Top 10 Most Trusted Brands” brands incorporate trust itself into their taglines.

They might also take note of how it’s worked our for “The Most Trusted Name in News,” whose tagline allows Donald Trump a convenient foil.

Risky Business

Claiming to be trusted is a bit like the Gary Hart strategy – daring the press to find otherwise. It’s like a red flag to a bull.

How many people will manage to dig up the fact that Walgreens made a substantial amount of money and growth during Prohibition by selling (legally) whiskey? Or that the pharmacy business managed to quickly carve out a very liberal interpretation of “medicinal purposes” during that period? Sorry, Walgreens, it’s what you’re setting yourself up for.

History aside, stuff happens. Ask BP about oil spills, or the old Union Carbide about explosions. Or, closer to home, J&J about Tylenol redux. Mis-steps are magnified, and stay in the press longer, for those who claim to be trustworthy in the first place.

Corporations are Not People

This is the biggest one. “Trust” is a word with much contextual nuance of interpretation. But one thing we can say for sure: personal trust is richer and stronger than corporate trust.

We trust people on an emotional level. We trust people based on our views of their intentions, their transparency, and their willingness to trust us.

By contrast, corporations’ intentions are usually very much self-oriented; transparency is little-practiced; and rare is the corporation without legal disclaimers governing their customer relationships. That’s not a criticism (well, it is a little bit); but it’s mainly just stating the difference between protein-based and legally-based entities and the ways we trust them.

Most corporate executives would probably agree with this in the abstract – but they ignore the implications in the particular. If they really believed it, they would be spending money on becoming more trustworthy, rather than on PR campaigns to be seen as more trustworthy, or on reputation management to change perceptions rather than underlying reality.

So What’s a Company to Do?

A company that is serious about being seen as trust-based would start by recognizing – it’s personal.

Trust is not created by spin, advertising, PR, or taglines. It is created by the collective personal behavior over time of corporate employees interacting with customers, suppliers and each other.

This means corporate trust is a culture-and-values issue – not a process-and-marketing issue.

A company that is serious about trust will, among other things:

  • figure out how to trust its customers and suppliers, often by taking some form of risk (because trust is reciprocal – we trust those who trust us);
  • invest in customer service by focusing on effectiveness, not efficiency; by using ROI, not budget variances, to measure success;
  • hire, train for, and role-model best practices for interpersonal trust, including emotional intelligence, strict truth-telling, and vulnerability;
  • consistently prioritize long-term, relationship-based behaviors over short-term, self-aggrandizing behaviors, in its compensation and promotion policies;
  • focus on ways to establish deeper relationships with stakeholders, rather than focusing on issues like NDAs, non-competes, or arbitration clauses;
  • make heroes out of people who model trust-based behavior.

We trust those more who do not protest how much we trust them.