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What Costs More Than a $1,000 Per Hour Lawyer?

Beginning just three years ago, some large firm legal fees reached that amount – about $17/minute – providing fodder for legal bloggers, and Internet articles on a variety of topics, including new marketing opportunities and excessive fees for bankruptcy matters to name just a couple. Only senior lawyers in the largest firms actually charge that much, and that’s to large companies on non-commoditized work. What about the rest of us? What makes a service worth that much to us? On my daily walks with Sam, we have a lot of epiphanies. Here’s one we came up with just before a Nor’Easter looming on the horizon. And no, this isn’t a rant about lawyers and their fees.

This is about snowplowing. I can only talk about the Boston area. Here, snowplowing costs anywhere between $35-50 per 3 inches of snow per driveway (the rest of you can fill in your own numbers). The average time per driveway – 3-5 minutes.

Here’s what’s interesting to me. Why is a homeowner willing to pay about $10/minute to anyone with a snowplow, yet would complain about that rate for most other services. I applied the Trust Equation to this question.?

  • Credibility: We’d prefer they not wreck the lawn or dig up the driveway, but if they do, well, things happen. We do want them to actually clean up the snow though.
  • Reliability: Jackpot. We’re paying for them to show up. Fast, and often if needed. If they show up relatively on time, they’re worth it. If they don’t, they’re not. Simple as that.
  • Intimacy: No need to empathize with us or share. Just do what is a straightforward job.
  • Self-orientation: If they want to tell us how great they are, it’s fine–just do the job.

This is a transaction, so Intimacy and low Self-orientation just don’t matter. However, Reliability is so important that we’re willing to pay more per minute than just about any other service we get. Credibility is important only in that the job be done reasonably well.

This made us think–where else is Reliability and Credibility so important that we’re willing to pay extraordinarily high rates so we can get it? Here’s our very short list:

a. Ambulance services. This is way out of line on a per minute basis. We’re paying for the competency to be available when we need it. Imagine if the costs were less, and they were only available at certain times. We have to pay more so they’re ready when we need them.

b. Travel–last minute. When you have to get home fast, you’ll pay multiples of the regular cost. I was in Dallas, and was required to stay 4 hours later than my flight. My round trip was about $350. My return flight 8 hours later on the same day was $1800. I wasn’t happy but I was willing to pay it. While air travel is not incredibly reliable, it’s more reliable than alternatives to travel long distances. I knew I’d get home.

Conclusion? Time sensitive needs merit higher rates, particularly where there are limited resources (like snowplows during a storm, planes to a specific destination, ambulance services), knowing you can use the service and it’s reliable is worth whatever it costs up to a point. What that point is depends on our need at the time.

Are You as Credible as You Think? Probably Not.

There are lots of ways to build trust with others (four, by our count) and Credibility is a big one. In our Trust Quotient research, Credibility shows up as second only to Reliability as the most favored way to build trust. (‘Most favored’ doesn’t mean ‘most effective,’ but that’s another blog, another day.) 

This makes sense, given the emphasis that most business people naturally place on increasing trustworthiness by demonstrating credentials, experience, and know-how.

The risk is that we stop there or—even worse—spend too much time there. Picture the March of 1,000 Slides.

There’s more to Credibility than meets the eye.

Three Dimensions of Credibility

When thinking Credibility, we mostly think words, as in what you say and how you say it. That means that having information, perspectives, opinions, and recommendations are all important—especially for people in professional services whose very existence depends on high quality advice-giving.

But there’s more. Speaking the truth matters too. A lot. As does delivering your message in a way that makes it easy for others to understand and relate to.

Top Ten List of Ways to Build Credibility

Here’s a Top 10 list of tried-and-true Credibility builders, categorized by Credibility’s three main dimensions.

Feature your expertise and credentials:

1.    Be diligent about researching your customer;

2.    Know about industry trends and information, as well as business news;

3.    Write about your areas of expertise—articles, blogs, white papers;

4.    Host events that bring key stakeholders together.

Improve your delivery:

5.    Use metaphors and stories to illustrate your point;

6.    Practice your delivery so you are clear … and clearly relaxed;

7.    Combine your words with presence—a firm handshake, eye contact (when culturally appropriate), a confident air.

Demonstrate your truthfulness:

8.    Offer your point of view when you have one;

9.    Respond to direct questions with direct answers;

10.   Be willing to tell a hard truth when it’s the right thing to do—including “I don’t know.”

 And as a bonus:

11.   Never ever lie. (This includes tiny little white lies and lies by omission.)

This last category, truthfulness, gets at one of the paradoxes of trustworthiness: The thing we’re most afraid to say is often what will build the most trust.

By the way, our clients tell us the truth-telling part pretty much applies to all cultures. Even in Asian countries, where saving face is paramount, the Trusted Advisor’s dilemma is generally less about whether to tell the truth and more about how to deliver the truth in a respectful and culturally-appropriate way.  

Credibility-Building Can Happen Lightning Fast

This expanded view of Credibility is good news for anyone new to a profession or new to a relationship. This part of trust–building your Credibility–doesn’t have to take time; being refreshingly honest can build trust in an instant.

Most clients and customers are so used to spin they will immediately take note. So you can actually leave the PowerPoint deck back at the office (or bring it as a leave-behind) and focus on engaging in a genuine, transparent, and honest conversation. Heck, you might even build some Intimacy in the process.

Take Stock and Take Action

Feeling stuck in a particular relationship? Do a credibility check. Start with the honesty dimension—it’s the least comfortable and highest payback. Ask yourself what you’re thinking and not saying, or saying to some but not to all.

 Then do something about it. You’ll be glad you did.

Trust on the Toll Road

A good friend of mine, Bob, recently lost his mother.  Following the funeral, disheveled and still in mourning he took to the road to return to Boston.  Approaching the tolls at the New York Thruway, he tried to slow down and discovered he had no brakes. 

In the split second Bob had to choose what to do, he examined his options.  Hit the cement barrier and risk getting hit from behind or go through the toll and hope the car in front of him was moving away thereby minimizing the risk of injuring someone.  He decided to put the car in park–which only slowed the car a little–and go through the toll. 

Unfortunately the car in front didn’t move away.  Luckily no one was hurt. 

When the police officer showed up, he too had a choice.  He had to determine whether it was, in fact, an accident and that Bob was telling the truth about his brakes failing, or if he was simply telling a tale to get out of a ticket by swaying responsibility. 

The officer chose a third option–he assumed Bob was trying to avoid the $1.25 toll.  What made this officer ignore the more likely choices and go for dishonesty of the third kind?  Was it Bob’s disheveled look?  Did he sound drunk? 

I can understand if the officer thought Bob was lying to avoid a ticket. He’s probably seen many people run through tolls.  What baffles me is why he would think Bob would run a toll when there was a car at the toll booth.   What made him select the most improbable scenario?

The implications for trust are profound.   We can influence our own trustworthiness by reducing our self-orientation, and increasing our credibility, reliability and intimacy. 

Yet those factors don’t operate in a rational vacuum when we consider whether to trust others.   Our upbringing, general experience, specific experiences, psychological makeup and even job responsibilities go into the mix. 

Put yourself in the shoes of the police officer.  Perhaps something similar happened in the past.  Maybe he’s heard so many excuses, that everything sounds like a variation on the theme.  Maybe he was just having a difficult day. 

Maybe he trusted someone’s story that turned out to be a lie once too often.  We want to be trusted, and we would like ourselves and others to be trusting.  We have to recognize when our own issues get in the way of trusting others.  And hope that our own hard work to be trustworthy will be enough for others to trust us. 

What happened to Bob?  The tow truck driver confirmed that the brakes failed.  

And the officer made my friend pay the toll, just in case.

Three Little Words

My mother always told me that bad luck comes in threes. At the risk of pushing my luck, I’m going to disagree with her–at least when it comes to trustworthiness. Here are three phrases, each three words long, that are an essential part of any Trusted Advisor toolkit: "That makes sense," "Tell me more," and "I don’t know."

"That Makes Sense"

Charlie speaks this phrase all the time and it’s remarkably effective. I say "speaks," rather than "uses," because it’s not a tactic; it’s a genuine expression of empathy.

When said from the heart, "That makes sense" is an incredible intimacy-builder. It’s no accident it also happens to be what relationship guru Harville Hendrix teaches couples to practice saying with each other when working through tough personal issues. Simply put, it’s validating. In a business context, "that makes sense" is particularly disarming in response to an opposing viewpoint…or something you don’t really want to hear.

Note that saying "that makes sense" is not the same as saying "I agree." With "that makes sense," you’re simply looking at the world from the other person’s vantage point and seeing how things might be pieced together. And unless you’re speaking to someone whose mental faculties are completely compromised, I promise you things do make sense over there, and there’s a way to see it, somehow or another.

"I see you’re concerned about investing a lot of money and time without being sure of the return. That makes sense."

"Sounds like it’s imperative to have the right executive sponsor in place before we move forward. That makes sense."

"It makes sense to consider all the options before you decide which firm you want to hire."

"Tell Me More"

"Tell me more" is a simple and elegant way to invite someone to share information with you. Distinct from a targeted, intellectually-impressive question, "tell me more" implies an absence of time pressure, agenda (as in motives), and a desire to show off. Its subtext: "The agenda is yours, my time is yours, and my focus is devoted to you, not me." Its beauty is in its simplicity and its other-orientation.

"I Don’t Know"

I’ve been in and around the consulting industry for close to 20 years and know very few consultants who are comfortable not knowing an answer to a question (myself included). On the contrary, we’ve convinced ourselves that clients not only want answers, they want the right answers…right away.  (See The Point of Listening is Not What you Hear but the Listening Itself.) Which leads to a lot of well-intended bad behavior, like ever-so-slightly exaggerating what we do know in order to fill in the gaps.

The alternative is having the courage to say "I don’t know" when you don’t know–being forthright in a way that appropriately conveys your overall confidence (so high, in fact, that you’re OK to admit what might be perceived as a weakness) and your commitment to find the most accurate answer. As counter-intuitive as it may be, "I don’t know" actually builds credibility (and therefore your trustworthiness) because it shows you are honest. ( For more about how the things we want to say the least usually build the most trust, read Trust and Golf: How Neither Makes Sense).

The Proof

Of course, we could add "I love you" to the list of word triplets, but then things start to get a little too squishy. (Or do they?)

I’ll end with this instead: intimacy, other-orientation, and credibility increase trustworthiness. "That makes sense," "Tell me more" and "I don’t know" improve your score on each. Therefore, three little words really can make you more trustworthy.

Quod erat demonstrandum.

P.S. By the way, with the new year upon us and so many of the usual resolutions already long-forgotten, it’s worth checking out Chris Brogan’s recent blog post, My 3 Words for 2010. Trusted Advisor Associates’ three words for the year (in draft) are Community, Rich-Soil, and Starpower. My personal ones are Leaps, Delicious, and Gravitas. And you?

 

 

 

Is it Stupid to Be Trusting?

The ever-catchy Seth Godin  highlights an ad for the new super-exclusive Visa Black Card.  So rare it’s made of carbon.  So elite that it’s limited to just you, and 2,999,999 of your closest friends. It screams exclusivity right through the mass media it’s advertised in.  

Nicholas Kristof reported last month  on how reliably un-expert experts are.  Philip Tetlock, he reports, studied 82,000 predictions by 284 experts over two decades.  The results:

“It made virtually no difference whether participants had doctorates, whether they were economists, political scientists, journalists or historians, whether they had policy experience or access to classified information, or whether they had logged many or few years of experience,” Mr. Tetlock wrote. 

Indeed, the only consistent predictor was fame — and it was an inverse relationship. The more famous experts did worse than unknown ones.

Dr. Robert Cialdini, the reigning expert in the field of influence, has identified six basic drivers of influence in human beings.  The first is reciprocity—a mutual sense of obligation triggered by the actions or words of one. 

The second and fourth are scarcity (the Black Visa Card) and authority (Jim Cramer).  It is demonstrably stupid to believe that the Black Card is exclusive, and that Cramer is a better stockpicker than the next guy.  Demonstrably.  But we believe both anyway.  (Well, not you and me, of course.  But everyone else does.  The fools.)

In sales, any number of experts will tell you that people buy from people they like, or trust; that people buy with their heart, and rationalize it with their brains.

If you’re not buying any of this, review exhibit A, Bernard Madoff.  He masterfully combined all the triggers into one slick package.  An expert, likeable, you could get in on the deal if you were special (you and your 3 million closest friends), and so forth.

A lot of people I talk to about trust throw up their hands at all this and say, “Anyone who trusts is a fool and a sucker.”  I prefer to call it human.  Trusting is not going away anytime soon; it’s too deeply imbued in our genes and is, net net, too valuable.

We can, of course, get smarter.  But the most likely result of getting “smarter” is to stupidly avoid sensible risk-taking by following the "smart" advice of someone else. 

“Smart” is a vastly over-rated virtue in the human species.  I’ll bet my Black Card on it.
 

Why Testimonials Are Over – Rated in Sales

How would you like to have Stephen R. Covey write a glowing book-jacket quote about you and your business?

What a great testimonial, right? Covey’s book The 7 Habits of Highly Successful People has sold 5 million copies since it’s copyright date of 1989. It is still—still—ranked number #85 on Amazon’s total rankings (including Harry Potter, etc.), and #1 in several sub-categories.

So a referral from Covey ought to be worth a ton. And by extension, references in general ought to be valuable, right?

Well, yes and no. And as usual, the no is more instructive than the yes.

Take the case of a new sales book: Sales Blazers, by Mark Cook. Right there on the cover, it says, “Sales Blazers is one of the most important books you will ever read.” –from the foreword by Stephen R. Covey.

"One of the most important books you’ll ever read. " That’s what Covey says, to you and to me, right there on the cover.

Now I don’t know about you—your reactions could be different than mine, to be sure—but for me, when someone tells me, flat-out, in a mass media outlet, that he knows what I will believe to be the “most important” anything in the world—watch out. That’s a red flag. I am already suspicious.

Now I’m thinking, ‘how dare you claim to know what’s important to me—much less “most important?”’ This is like TV ads that address me in the second-person singular as “America.” (“America, we know you love sports. That’s why we created pocket couch potato…”)

Lesson one about testimonials: all the testifier’s fame is put at risk if the testifier claims knowledge he doesn’t have—in this case, knowledge about me.

So now I’m predisposed to be suspicious when I check out the book. I note in the foreword that the author used to work for Covey’s son, at Covey’s company in Salt Lake City. Self-interest rears its ugly head like Putin flying over Alaska. Is this going to be an objective review? Cui bono?

I check out the (three) online reviews on Amazon. The first two are by people living in Salt Lake City. What a coincidence. (And, surprise, they’re positive).

Now I’m ticked off before I open the cover.

When I finally look at the book, it’s all about how leadership can improve revenue for a sales team.

OK, fair enough. I believe that. And I see the link between leadership and team performance. I also believe Covey knows something about that, so now he’s regaining a little credibility with me.

But as I read on, I notice the book is all about selling and revenue and achieving sales goals. Nothing about customers.

I mean nothing! I go to the index. There are 2 entries on “competitor,” and about 13 on "rewards". But “customer?” Not a one.

Now, there’s nothing wrong with leadership, revenue goals, or sales success. They’re all very relevant to sales, obviously. A book about it is perfectly valid.

But in my case—me, personally—I happen to believe very strongly that sales should be ultimately all about the customer. I mean by that—the end goal, purpose, meaning and intent of sales—is to improve life for the customer; and that if you do that, you too will succeed wildly in selling.

You don’t have to agree with my view on that, nor do Covey and Cook (and evidently they don’t).

But—if you’re going to tell me, in a mass medium, what I, me, personally, am going to consider one of the most important books I’ll ever read—then you’d better be right.

And in my case, he was wrong.

This looks like a decent book on leadership and sales force management. Is it "one of the most important books I’ll ever read?" No way, no how, not even in the ballpark with a ten-mile pole, not a chance, you-gotta-be-koidding me.

And that’s the trouble with testimonials.

If you’re asked to give a testimonial, restrict yourself to statements in the first person. If you solicit one, don’t over-estimate the impact.

But—the heck with you Charlie, you might say—’Is it working?’

See for yourself at Amazon’s ranking: At this writing, it was ranked #298,332.

For comparison, see the Top 100 sales books on Amazon, where the #100 sales book is currently ranked #27,000. Not even close.

Don’t over-estimate the power of testimonials.

And don’t squander your own precious credibility by claiming to know the customer when you don’t. A reputation is a terrible thing to waste.