Trust-based Networking and the Paradox of “Collateral Benefit”
A (seemingly) simple question: What is the goal of business networking?
- The goal of most business networking is to make new connections in order to get more business.
- The goal of trust-based networking is to help others develop their businesses. The “collateral benefit” of trust-based networking is that others then help you.
When it comes to networking, injecting trust into the picture creates a sort of paradox. It’s exactly the same paradox that arises when we think about injecting trust into selling, or advice-giving, or getting people to review your books.
That paradox was expressed well by Dale Carnegie, Zig Ziglar, and a host of others: basically, the best way to get what you want is to help others get what they want.
It’s easy to forget how radical that proposition is; and how infrequently people actually do it.
Current Networking Practice
Ask yourself: when you go to a meet-up, start looking through LinkedIn, or scan a rough lead list – how do you proceed? Here’s what usually happens:
- You search and scan in advance for those you’ve profiled as most likely to be prospects – focusing and prioritizing to narrow down a wide list of leads
- You focus on honing your elevator pitch
- During interaction, you focus on finding pain points (waiting to offer solutions at a later time).
If that roughly resembles what you do, then please take note: all three of those benign-sounding activities share one trait – they’re all about you. They are not activities that put Dale Carnegie’s insight into practice.
Trust-based Networking
What if you were to try something entirely different? For example:
- You search and scan for pairs of people both of whom you know, but who don’t know each other – and who could each benefit from the introduction
- You focus not on your elevator pitch, but on a really great question you’d like to know the answer to (better yet, ask the question in the form of a Risky Gift)
- You focus not on pain points, but on being genuinely curious and seeking perspectives.
Those are very different activities: they’re not self-focused, they’re other-focused. And, they are more likely to result in relationships and in interesting conversations. It is those relationships and conversations that result in true connections of interest – and before very long, in leads and business development conversations.
The “collateral benefit” of behaving this way is – leads and sales. In fact, more leads and more sales than if you go in with the usual self-centered approach of trying to get leads and sales directly.
But the paradox must be respected: if you engage in these other-focused activities as mere fig-leaf cover for your true goal of getting more sales – it won’t work. We all see through such base motives. You actually have to commit to the alternative goal – that of helping others.
A good test of whether you’re really committed is your choice of metrics: do you measure the result of networking by how many entries you generate for your CRM system? Or instead – by tracking how you’ve been able to benefit your new acquaintances. (Hint: what would Dale Carnegie say?)
Learn more about this strategy by viewing our Trust Matters webinar: Network Like a Trusted Advisor: Take the Work (and Stress) Out of It, delivered by our partner and co-author of The Trusted Advisor Fieldbook, Andrea Howe, together with Stewart Hirsch, our head of business development and leadership coaching (and CEO of his firm Strategic Relationships). You also might want to check out our eBook The Do’s and Don’ts of Trust-based Networking.
Answer the Question
Q. What do you do when your client or customer asks you a question?
A. Why, answer the question, of course! (Doh!)
But – what if the question itself is flawed, or incomplete, or dangerous to answer?
For example:
- What if a potential client wants to know the price before you have explained the value?
- What if a client demands to know the final recommendation before going through the analysis?
- What if a client phrases a question as a simple “go or no-go” when the issue requires nuance?
- What if a potential client asks you a very pointed and narrow question about your qualifications?
Then what do you do?
On the one hand, if you answer the question directly, you risk giving an incomplete answer. You open yourself up to a ‘gotcha’ question. Worse, you legitimize a partial or even misleading question by the mere act of responding to it.
On the other hand, if you don’t answer the question, you risk offending the client. Worse, you look like you’re trying to hide something. And, it’s likely to come off as just disrespectful.
How can you avoid disrespecting the client, while not opening yourself up to an unfair and premature judgment?
How to Answer the Question
There is a way out of this dilemma. Better yet, it not only avoids a negative – it actually helps build trust. Here’s what you say:
- Flatly and simply answer the direct question you were asked
- Pause
- If necessary, offer to answer more questions
Here are some examples: then I’ll talk about why they work.
Client: Before we dive into specifics of the situation, I want to know the price on this project.
You: Depending on several issues, around $225,000.
[Pause]
Client: Um, depending on what, for example?
Client: Before you go on to page three of the presentation, I want to know: do you recommend we close the factory, or not?
You: We recommend you close it.
[Pause]
Client: OK, why?
Client: How much experience do you have doing marketing studies for tech services companies?
You: Two prior clients in the past 18 months.
[Pause] [More Pause]
You: Is there something else it would be useful to talk about?
Note the critical role in the dialogue of the [Pause]. In the first two cases, the client is the one who fills in the quiet space. In the third – after making extra-sure of the pause – you fill in the space, by respectfully offering to answer any more questions
The Text and the Sub-text
That’s the text. The sub-text is what’s critical here.
First, the answer. It has to be simple, specific, and directly responsive. That’s because the critical sub-text is all about respect.
By being simple, specific and responsive, you are conveying to the client, “I am willing to let you take the lead here. I am not going to quibble about the relevance of your question, or its potential for revealing value. I am not going to ’spin’ my answer to suit my own needs, but rather will defer to your terms, as stated by you. I will not hedge, hem, nor haw. I respect your right, as the client, to set the agenda and ask the questions; I will reserve my own attempts to frame the issue until you are satisfied. I respect you.”
One effect of showing respect by being simple, specific and responsive is that you reduce the level of fear and aggression in the client. You are demonstrating that this conversation does not have to be a competition, and the client need have no fear about you attempting to control them.
The other effect is to validate the client, to show them that they have asked a fair question, and that you have given a fair answer. Presuming fairness and reciprocating in kind appeals to the client’s innate tendency to return like for like – fairness for fairness – vs. engaging in passive-aggressive games of controlling the agenda.
Second, the Pause. The subtext of the pause is, again, respect. It allows the client to control the agenda (by following up, by taking a new tack, or by simply abandoning the question). This offer of control is another trigger for reciprocity on the part of the client.
Usually – as in the first two examples above – the client will fill in the pause. And their response will usually be tempered by the respect you have already shown them in the simple, specific and responsive answer.
Occasionally – as in the third example above – the pause continues long enough for it to be appropriate for you to offer another comment – and yet another opportunity to show respect. You do this by making explicit what was already implicit – that you are willing to answer any questions, and to respect the client’s right to frame those questions in any form they may want.
The Result
In most cases, this “onslaught of respect” is enough to alter the tone of the entire meeting. Instead of being cautious, suspicious, and aggressive, the client is likely to reciprocate and return the favor. (The fundamental nature of reciprocity was never better phrased than by Robert Cialdini: take a listen to this podcast interview of Cialdini by Barry Ritholtz).
You can call this dynamic “give to get,” or “trust to be trusted,” or “mxqtplskz;” what you call it doesn’t matter. What matters is that by treating a loaded question with respect, you can transform the context within which that question is being asked, and thus transform the relationship.
All by just responding to the question simply and specifically – and pausing to show even more respect.
The next time a client asks you a tough question, just try it. [Pause].
The Disconnect Between Short-term Behaviors and Short-term Results
One of the most frequent trust questions I get is typically phrased as a dilemma: how can we establish trust-based long-term relationships in a culture that values short-term performance?
But rarely have I had the question posed so clearly and sharply as in a recent discussion with an investment banker. Paraphrasing, he said:
“Listen, I make no apologies for being 100% money-motivated. That’s why I’m in the business I’m in. If the firm changed our incentives tomorrow to a weekly basis, I’d be there in a heartbeat – doing what I have to do, week to week. So when you talk about long-term trust, I frankly glaze over. My timeframe is what maximizes my income – period.”
You can trust investment bankers to cut to the chase. It’s their job, and they’re very good at it.
But here’s what he missed.
There’s an unspoken assumption in his stark phrasing of the issue. That unspoken assumption is:
The best way to maximize short-term income is through short-term behaviors.
And that assumption is dead wrong. Here’s why.
The Disconnect Between Behavior and Results
The point is obvious if you think about strategy. Which approach to corporate strategy is likely to be more successful over the next five years?
- Company A, which revamps its entire corporate strategy every quarter, or
- Company B, which sets its corporate strategy over a five-year timeframe, and occasionally tunes it
Pretty clearly, changing a long-term strategy on a quarterly basis is the recipe for long-term bad results. But notice – long-term bad results happen a quarter at a time. Five years of bad performance shows up in 20 bad quarters.
The basis for strong short-term results (quarterly in this case) is long-term behavior – not short-term behavior.
What’s true for strategy is true for relationships as well. If you manage your client relationships by viewing them through the prism of quarterly (or monthly, or weekly) sales and income reports, those clients are bound to notice.
Few things destroy client relationships like a lame, semi-apologetic request like, “Could you maybe move that sale up a few weeks so I can get credit this quarter?” Clients are not stupid, and there’s no way to dress up such a self-serving request for monetization of the relationship so as to disguise what it really is. Such a request will backfire on you.
So will any such behavior that betrays your true objective – if your true objective is to treat your clients like transactional piggy banks, rather than as the long-term relationships we claim to aspire to.
Long-term Greedy
Former Goldman Sachs senior partner Gus Levy is credited with coining the phrase “long-term greedy.” In typical Wall Street fashion, the phrasing was perhaps calculated to sound offensive – but in fact, it expresses something completely commonsensical, and highly consistent with trust. I endorse it myself.
What Levy meant was that the best way to do well in the long-run – and, by implication, in each quarter on the way to the long run – is to behave in a long-term manner. That means: keeping your word, taking care of clients, acting with integrity, putting clients’ needs first – all the time.
If you behave that way – in the long-term, as a matter of habit and principle – then you will actually do far better in the long run (and by extension, in the accumulation of short-terms on the way there) than someone who is constantly seeking to optimize only the next quarter.
Note this does not necessarily have anything to do with ethics. You can be, as my investment banking friend claimed to be, 100% motivated by money, and still act in ways that are largely indistinguishable from someone whose trustworthy behavior is ethics-based. You just have to not be stupid. And Gus Levy was assuredly not stupid.
The next time you hear someone say. “I can’t do that trust stuff because all the incentives around here are short-term,” explain to them why there’s nothing wrong per se with short-term incentives. The problem is stupidly believing that short-term behavior is the best way to get there.
The best short-term results come about from operating on long-term principles – and reaping the benefits every quarter along the way.
Trust Matters, The Podcast: Building Trust When Industry Spirals Into Cutthroat Pricing (Episode 13)
The Single Biggest Thing an Advisor Can Do
Most of you reading this are advisors, in some form or another. That’s obvious if you’re a consultant, accountant, or lawyer. Also if you’re a financial planner, account manager, executive searcher, and certainly if you’re in sales.
It’s less obviously, but equally, true if you’re in one of a thousand customer-facing roles with titles like customer (-experience, -service, -success, -relationship), delivery service, pre-sales, technical support. Even if your job has a title like operations specialist, or technical project manager, or product manager, your success hinges heavily on your ability to offer good advice – and to have that advice taken.
So what’s the Single Biggest Thing an Advisor Can Do for his or her client/customer/advisee?
It’s not “add value” (almost always a narrow financial concept, and not one that guarantees acceptance of the idea). Nor is it to “challenge” the advisee (again, a challenging idea unaccepted just annoys the advisee).
Let me suggest that the Single Biggest Thing you can do for an advisee is to help them reframe their problem definition – in a way that increases value, clarity, and commitment.
Back to Roots
One of my favorite David Maister epigrams is, “The problem is never what the client said it was in the first meeting.” A tad hyperbolic? Perhaps – but my own experience has taught me that David was far nearer right than wrong.
Let’s take a few basic examples. See if these ring true.
- A potential client approaches a financial advisor, because (s)he is unsatisfied with their own track record of managing their investment portfolio, and hopes a professional can do better.
- A potential client approaches a bookkeeper, because they don’t want to become experts in QuickBooks, but their small business is rapidly demanding more such time.
- A potential client approaches a ballroom dance studio because they want their wedding dance, to their favorite song, to go perfectly.
All three of those presenting problems are reasonable on their face. And all three advisors can probably present competent answers:
- The financial advisor can almost always do a better job of portfolio balancing and risk-profiling than an amateur investor;
- Any bookkeeper is going to be more adept and efficient at bookkeeping software than a moonlighting business owner;
- Any ballroom studio can fit a dance to almost any song.
But if the advisor chooses to respond to those problem definitions as presented, there are three problems:
- Those problems are all defined at pretty low levels of value-added; basically a make-buy decision based on perceived efficiency;
- They may be what the client thinks they want, but not what the client really needs;
- Just giving people what they ask for doesn’t do much to motivate their taking your advice. (For a whimsical but right-on example of this, see Episode 6 of the reality TV-show Sell It Like Serhant).
Redefining the Problem
But what if the advisor in each case succeeds in engaging the client in a way that jointly examines the true root issue? In many cases (OK, all, David would say), the problem definition can change.
- A good financial advisor will also ask the client questions about the names in which taxable accounts are held, about the client’s use of trusts, and about educational plans for their kids. All of those have implications for the portfolio, but each of them also has profound financial implications in their own right. Many clients in such conversations realize that their real goal isn’t just better stock returns, but something more fundamental – financial security, for example.
- A good bookkeeper won’t just demonstrate Quickbooks proficiency, but will also ask about useful managerial reports, interface with the tax accountant, and plans for online payment systems. This gets the customer to think about the use of Quickbooks, not just the efficiency with which one can manipulate software.
- A good dance studio will determine whether the favorite song is really danceable by other-than-pros, and whether something else might better fit the true goal – to receive glowing comments and feel good about themselves at the close of the dance.
Redefining the problem often makes the problem definition larger, or more holistic – like the financial planner example above. But it doesn’t have to.
The point of redefining the problem is not to up-sell – it is to get the client higher value, greater clarity about their own objectives, and thereby greater commitment to actually doing something.
It’s Not About the Advice
The biggest problem advisors have is to stop thinking it’s about the advice. Being right is table stakes, jacks-for-openers. Any subject matter expert can be right – in fact, most are. The truth is, subject matter expertise in this day and age of AI is rapidly becoming automated (think robo-advisers, offshoring, and YouTube videos).
Good advisors remember that, just because the client says the problem is thus-and-so doesn’t mean that’s the problem. Which means the challenge of advising is not getting the better answer: it’s getting the client to accept that there might be a better answer.
The above examples are all from sales, but the problem is the same if you’re implementing a CRM system. The client wants it to do what the old system did: your job is to get them to see that the new system can accomplish much more, of more basic objectives.
Here’s how you don’t do it:
- Tell them you’re the expert and you know better than they do
- Show them a financial comparison of their idea and your idea
- Tell them about all your past clients who successfully took your advice.
Instead, take a page from the one profession that is built on getting people to take advice – therapists of one form or another. (This most definitely includes your best friend, when you go to them for tough life advice).
What do all good therapists do?
- They listen to you; not for clues about how to define the problem or add value, but to understand how you view the problem
- They ask questions: not 20-question-game deductive queries aimed at winnowing down the solution set, but rather aimed at getting you to see your own true objectives and motives
- They care: their objective is for you to get better, on your terms, not theirs.
Because the truth is, most of us are suspicious of our own problem definitions – even as we are defensive about them. It is not easy to get people to take advice: we all are resistant. The solution to resistance is first to find common ground – but first on their ground, not ours. Done right, we become first unthreatened, then open, then grateful and committed once we see and can accept another problem definition.
This stuff is simple. That doesn’t mean it’s easy, by a long shot. In my view, getting your advice taken is a lot harder than getting the advice right in the first place. That’s why good advice can be copied by AI; but human interaction is the provenance of getting your advice taken.
It starts by helping people redefine their own problems – on their terms.
Blurring the Line Between Sales and Marketing
I got an email from, Ralph, the 50-ish owner of a small consulting firm. He had three competing offers to buy his practice, and a few complicating life factors. He wanted advice, and asked if we could talk.
I don’t do much coaching or consulting, and he almost surely couldn’t afford my rates. Nor am I an expert in life planning, or in valuations.
But I said sure, call me in the morning, we’ll talk – no charge.
We had a very good chat for about 45 minutes.
I think I helped him. I know it was useful for him to talk to a third party able to comprehend his situation. I believe he’ll make a better decision, and I’m sure he’ll feel better about it. Value was created for him in our talk.
But How Does Free Advice Help the Advice Giver?
But what about me? I knew going in there was no chance of a sale from him – not now, not in the future, not anytime. And my rate was zero. Was this a foolish, impetuous, soft-hearted, flakey thing to do?
No. I like doing nice things, but I’m not a saint. Nor did I consider Ralph a pro bono case.
Sure, it was a nice thing to do. But, I would argue – it was also good business.
Sometimes a sales lead that we would otherwise screen out can be a good marketing investment. Sometimes you can do well by doing good. Sometimes we need to blur the line between sales and marketing.
“Ralph” will never buy from me (though other Ralph’s have done so). But he will remember what I did for him; even more, that I was willing to help.
Remember: Ralph invested time in searching for alternatives, chose me, and felt strongly enough to seek me out. He spent time to find out who I was, what I did, whether and how I might be useful to him. He was probably willing to pay for consulting. He was an educated, willing buyer, a near-client with influence on other potential clients.
For me, he was not a qualified sales lead. Instead, he was one helluva marketing resource.
Ralph now knows me – the sound of my voice, how well I think on the spot, the way I interact, my sense of humor. He knows me better than one of 200 people in an audience for a speech; much better than 500 people reading this blog, or an article of mine.
Total investment: 45 minutes. Most sales people will tell you that’s an extravagant waste of sales time, an inefficiency that is off-scale. Just think of the waste in extrapolating such activities to scale!
But most salespeople would be wrong. This is not about efficiency in selling: this is about effectiveness in marketing. (And let’s not forget, I also learned some things about valuations).
Let’s say Ralph will tell a dozen people about our discussion. Those are people who understand what each of us do, and who are first-degree connections to Ralph. That’s a powerful testimonial. Sounds like a reference to me; better yet, one freely given.
The choice is not between being “good” or making money; they often go together.
Try, for just a few hours per month, shifting your sales practices to subsidize your marketing by investing in a lead.
Don’t get lost in charge-back accounting and tit-for-tat favor-record-keeping. The benefits will eventually accrue to your firm, and to you personally. Both.