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Misconceptions about Trust-based Selling II: The Time Thing

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Last week I wrote about the first of three misconceptions people have regarding trust-based selling—the idea that it’s naïve.

This post tackles the second misconception: that trust takes too much time, both elapsed time and in aggregate. You’ve heard this one as either:

  • “trust takes time and we can’t afford to wait that long,” or
  • “trust takes such a big time commitment I’m not sure it’s worth it.”
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It takes too long; it takes too much. Neither is true.

Let’s start with “trust takes time.” How long does it take for you to read the degree on the doctor’s wall? To notice the doctor’s white coat? To share feelings with a surprisingly interesting seatmate on a transcontinental flight?

More pointedly: in a sales conversation, how long does it take to demonstrate interest, curiosity, caring, and enough self-confidence to shift the agenda on a dime in response to client interests? All these take less time than a conventional process-driven, presentation-oriented sales meeting—and create more trust.

Now let’s consider “trust takes such a big time commitment.” Behind this statement is the belief is the first belief—that people only come to trust slowly, in incremental parts, repeated frequently over time.

But trust has many dimensions: the “trust takes time” belief is mainly focused on reliability, which by definition does take elapsed time. It misses other senses of trust—credibility, integrity, intimacy, other-focus, for example. Those can be established in an event, in a moment, with a handshake, a word, a question asked at the right time in the right tone. These take very little time. And hence they don’t take a huge investment.

Let’s move away from B2B sales: consider online dating services. Do they take time? Do they require large investments of time?

Not if you consider the dating scene pre-Match.com. Think of the ability to read people’s self-descriptions, to hear about them in their own words, perhaps with video or audio, perhaps with some advance “metrics” on compatibility.

Now consider how long it took, and much invested time it took, to get to a comparable level of trust one date at a time, over days and weeks. Or consider the odds of a first date ending well in the online dating world, vs. the blind date world of not that long ago.

Rapid trust creation is not an oxymoron; if anything, it taps into something more powerful. Rather than waiting to develop trust by reputation, we can create trust by being bold, other-oriented, curious and courageous—quickly. And benefiting all.

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Note: I will be giving a webinar this Thursday, on How to Build Trust in Sales Conversations.   It’s hosted by the good people at RainToday.com.  It’s from 2 to 3:30PM US Eastern time.  Again, that sign-up address is here.  
 

Short-termism, ROI and Green Economics

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From BusinessWeek comes the painful story of an idealist butting heads with resistance and inertia. Nominally it’s a story of Green economics — identifying ways to be profitable while reducing environmental impact.

But it’s also about an emphasis on short-term economics that is not only paralyzing environmental activity, but is harming business and society.

Think of it as the triumph of payback time over ROI analysis.

Auden Schendler is a classic young outdoorsman environmentalist, full of hope that his employer, Aspen Skiing Company, will “get it” regarding his recommendations.

He recommended a $100K project to remodel the oldest lodge; it has a 7-year payback.

Too long, said the company.

OK, then, how about fluorescents in guest rooms—a 2-year payback in eco-friendly savings.

Nope, not warm enough light for guests.

OK then, how about $20K to save $10K per year in the underground garage?

No, we’d rather spend it on amenities guests notice.

It took Schendler two years to overcome resistance to the garage-light replacement, and then only after he secured a $5,000 grant from a local nonprofit. He acknowledges the strangeness of a corporation with annual revenue of about $200 million, according to industry veterans (the company declines to provide a figure), seeking charity to reduce its electricity use. With a hint of sarcasm, he notes: "This is the sort of radical action that’s needed to get people over ROI thresholds."

BW is writing about Green economics. But look at the examples.

What kind of capitalistic enterprise is passing up 50% returns on investment? The answer—a whole lot of them.

Our economy is increasingly governed by the belief that a bird in the hand is worth more than two in the bush—because that two-bird bush could blow up at any time, and besides, you just might find a four-bird bush around the corner.

Look at the forces of short-termism at work:

• The average length of ownership of a stock is down by orders of magnitude from a decade ago;
• mortgages used to be resold once or twice; now they are sliced and diced and repackaged into securities that are themselves sold over and over;
• the growth of private equity is, among other things, a shortening of the time period of evaluating a company’s worth;
• the growth in auto leasing represents a shortened ownership period;
• Real estate is increasingly a short-term investment to be “flipped;”
• Outsourcing reduces the time required to make a switch in organizations;
• Divorce rates, clothing style cycle times and TV show lifespans—all becoming shorter.

A shift toward transactions goes hand in hand with a reduced time perspective. These shifts make for more efficient markets, and reduce transactional costs (though increasing their number). But there’s a big downside: if everyone’s looking for fast hits, then no one’s around to play the long game.

Mathematically, there are three reasons payback analysis is supplanting ROI analysis:

1. Investment “owners” are turning over faster; I want mine now, thank you;
2. Uncertainty feeds the “get rich quick” mentality; why tie your money up because,hey, you never know!
3. Uncertainty also feeds perceived risk. In effect, investments are being assessed at increasing hurdle rates for farther-out timeframes (note to self—or kind reader?—check bond markets for evidence of this)

So we get more of this kind of thinking:

• Why should a private equity firm invest in anything beyond what will increase the return when the company is sold in three years?
• Why should any company invest with a longer timeframe than three years, lest it be taken over by a private equity firm?
• Why should a company invest in employees, since after all they might leave?
• Why should a company invest in customers if the payback takes over a few years?
• Why invest in branding? In training? In anything you can outsource? (And make sure the outsource contract shows a payback of at least two years).

With this kind of thinking endemic, it’s no wonder we’ve got a hard time figuring out how to reform social security, save the environment, deal with immigration, or rebuild falling bridges. It’s just not fast enough to suit us.

Thank goodness Schendler has the optimism of youth. He doesn’t know what he’s up against.