Handling the Risk of Trusting Others’ Motives

I ran across this the other day:

I am not a victim of others, but rather a victim of my expectations, choices and dishonesty. When I expect others to be what I want them to be and not who they are, when they fail to meet my expectations, I am hurt.

When my choices are based on self-centeredness, I find I am lonely and distrustful. I gain confidence in myself, however, when I practice honesty in all my affairs. When I search my motives and am honest and trusting, I am aware of the capacity for harm in situations and can avoid those that are harmful.

A friend said something similar:

When I meet people, I bring an implicit contract. In that contract, I agree to treat them with the utmost respect, in ways that I would wish to be treated. And in return, all I ask is that they treat me with the utmost respect, in ways that I would wish to be treated.

Frequently, I find they end up in breech of contract. Of course, I haven’t presented them with the contract for them to read. And so it goes without saying, they haven’t signed it. D’ya think there’s something wrong with my contracting procedures?

Looked at from this angle, to trust someone is a unilateral decision to seek a bilateral relationship. When the other responds, then you’ve got a basis for something joint—or you don’t. 

But at the outset—when the trust-risk is first taken—there is no obligation. There is thus no basis for dashed expectations, disappointment at outcomes, or resentment that people didn’t do what we had wished they would do.

Most of the time, trust offered gets reciprocated. But not all of the time. That’s why they call it trust, it always and by definition comes with risk. To expect a particular outcome in a particular instance is to insist on changing the laws of probability. You can bet that 5000 coin tosses will produce roughly 2500 tails. But if the very next coin-flip turns up heads—how crazy is it to be upset? 

This is the meaning of “an expectation is a pre-meditated resentment.” 

Do You Trust the Taxi-Driver? Or Not?

I spent last week in Denmark, 40 miles outside of Copenhagen. While nearly every Dane speaks near-perfect English, I of course stand out as an American.

I took a taxi from a resort hotel venue to the local train station. The fare was 70 kroner (about 15 dollars). I gave the driver a 200-kroner note. He gave me back 30 kroner change.

So here’s the question: If it were you in that situation, what would you instantly assume about what is going on?

Trusting vs. Being Trustworthy

Much of what we usually talk about on Trust Matters is trustworthiness, as opposed to trusting. They are not the same thing; in fact they are quite distinct.

The ability to trust strangers (as will be described in this week’s Trust Quotes interview with Eric Uslaner—tune in Wednesday) is instilled in us when we were young, and does not change easily. Trustworthiness, on the other hand, feels less risky and is more teachable.

The taxi driver incident is about trusting, not trustworthiness: and it offers a quick litmus test of your propensity to trust. Which do you instinctively assume:

  1. You assume that obviously the taxi-driver made a mental slip, thinking you had given him a 100-kroner note, rather than a 200-kroner note. It is early in the morning, perhaps he hasn’t had his coffee. You politely point out you had given him 200.
  2. You momentarily think, “What is going on here? Why did he do that?” and then just as quickly assume he probably just had a momentarily lapse. Since the 200-kroner note is still in his hand, you are comfortable pointing at it and smiling, so that he will notice his error.
  3. You are mildly annoyed: you think, “He can’t be pulling this move, can he?” You quickly realize, however, there is no risk here; you simply point out the 200-kroner note still in his hand, somewhat clumsily sitting on his lap. “I gave you 200,” you firmly point out, realizing also he had plausible deniability—if pressed, he’d almost certainly insist it was an honest mistake.
  4. Adrenaline rises in you instantly: you think, “What do you take me for, some naïve foreigner you can hustle? No way, Jose, are you getting away with this crap—not with me, you don’t.” You point directly at his hand, still guiltily holding on the to the 200-note, and say grimly with clenched teeth, “You’re short, buddy; give me the other 100, and you can forget about a tip.”

There is no right or wrong answer here, there are simply degrees of propensity to trust. Whether your answer is ‘smart’ is also situational; you may answer differently in rural Denmark at 9AM than you would in downtown Hamburg or Detroit at 2AM (and if not, you’re naïve).

Given that, if your answer is:

  1. You are very trusting, more so than the average person in the world. Depending on the situation, you may be too trusting, in fact, for your own good.
  2. You make a distinct choice to note your suspicions, but to act as if you do not have them; people read you as responding from trust, though you haven’t given up your objectivity about risk.
  3. You’re a bit suspicious. While most would not take offense at your response, neither are you likely to take advantage of some opportunities presented in life. Your basic response to life is one of caution.
  4. You believe you don’t have much control over your life, and that others know it and are out to get you before you get them. You expect little of others, and are rarely disappointed.

The interesting thing about trusting-ness is that it is catching. The way you behave toward others influences the way they respond back to you.

Whether you expect the worst of people, or the best of people, you’ll pretty much be right.

Act accordingly.

Blame is Captivity, Responsibility is Freedom

This week we will be exploring a theme: that business is both scientific and human, but that it has become far too much the former, and far too little the latter. We began it yesterday by pointing out Martin Luther King’s profound focus on relationship to others.

The title of this blogpost is a quote from Phil McGee, who writes his own intensely autobiographical blog, It’s one of his meatier nuggets, and I had occasion to use it last week.

I met with an acquaintance–Susan–who is in the middle of a large and complex initiative, putting together a consortium of independent players. The group is long on vision and expertise, but short on tactical how-to and make-it-happen ability. That’s where she comes in.

As we talked, she told me of her concerns about roles, timing and execution. We’d had this conversation before. She is probably about 90% right about it all, but has become frustrated with her inability to generate movement. "It’s like pushing on a string," she said, and she’s not wrong. Meanwhile, she was feeling unappreciated, unheard and unhappy.

What Problem Are We Trying to Solve?

But this time, as we talked, another level of the issue became clear to us both. No one was going to do what Susan was suggesting needed doing. No one, that is, except her. In fact, probably no one else could do it–only she had the skills and perspective to make it happen.

We reframed the question from "how to get others to do…" to why she shouldn’t do it herself. I asked her just that: what are you afraid of? She is honest and reasonably self-aware. She reflected just a moment and said, "I guess I’m afraid it might not work, and others would blame me."

"And?" I asked. She answered the question. "I guess there are no guarantees, and someone has to own the risk. And if others blame me–well, if I have involved them along the way, then I guess I can live with that. Blame would be their problem, I don’t need to own it." Case closed.

Blame and Freedom

Susan had been blaming others for the team’s inaction. That had deflected her attention from being responsible for her own contribution. Once she stopped blaming and took responsibility, she freed herself–from the fear of other-imposed guilt. In retrospect, Susan herself held the keys. She and only she could stop the cycle, and could do so just by assuming  her part in the whole drama.

Blame is captivity, responsibility is freedom. Susan freed herself, and she didn’t do it with processes or incentives, rules or regulations. She did it by identifying what she was and was not responsible for. That’s pretty personal stuff.  But as McGee says, most of business is just personal.

Why It’s So Hard To Collaborate

Many words are written in an attempt to describe the next new thing. These days that list includes: trust, authenticity, collaboration, holistic, personal, sustainability, engagement, and relationship capitalism.

You could make a case that the ‘most likely to succeed’ is collaboration.

Why Collaboration Seems An Obvious Winner

For one thing, the economic benefits of collaboration seem somewhat obvious. Philip Evans of BCG has written about the massive cost advantage accruing to Toyota vs. the US auto producers due to their ability to collaborate with their suppliers. Steven M.R. Covey Jr. has written about the stark cost and speed savings available to those who seek it. I’ve written about it at some length too and in fact collaboration is one of the Four Trust Principles in my own work.

Furthermore, it’s not hard to understand what collaboration looks like. It means cooperating, not fighting. Our mothers taught us that regarding our siblings, and our teachers taught us about playing nicely together in the playground. There’s a sense that ‘we know how to do this.’

So—Why Don’t We Collaborate?

We know why to do it. We know how to do it (or at least we think we do). So why don’t we do it? I learned an axiom about ten years ago from Phil McGee: if you see negativity happening, the odds are good that you’ll find fear at the heart of it. Personal fear.

At this level, I can’t presume to speak for others, so I’ll have to just put out there why I fail to collaborate. And I do fail—constantly. The more calm I get, the more I am capable of noticing just how anti-instinctive it is for me to collaborate.

Let’s say someone calls me to say, “Hi, I see you wrote something about collaboration; maybe we could collaborate on writing more about that, get to know each other, maybe work together in some way?”

My first instant reaction—if I’m honest—is negative. This person is trying to steal my thunder, trying to get something from me. I careen back and forth between dismissing the person and fearing they’ll overpower me. Are they worthy of my time? Worse yet—am I worthy of theirs?

I know the benefits: I’ll learn and grow, and have more chances for good things to happen by behaving collaboratively than not.

And I know how to do it: just say, “Hey that could be really interesting, let’s talk,” and then do so, from a place of curiosity.

And yet—those first instincts rise in me.

I’ve gotten much better at it. I almost always notice those instincts now, right away. Not that long ago, I just lived in them.

Sometimes I get over it and say/do the right thing within 30-60 seconds. Other times it may take up to a day of thinking on it before I end up doing the right thing.

Yet there are still those times I have managed to put things off indefinitely. Or others where the opportunity is now long-gone, and exists only on my should’ve guilt list.

The Logic of Avoiding Collaboration

I don’t really think it’s just me. In the face of astonishingly obvious economic benefits, and a fairly obvious set of “how-to’s,” I think the main reason we don’t collaborate is simple. Simple fear.

There are two simple approaches to lowering fear. One is to mitigate risk. The other is to stop being so fearful. The first one is getting most of the press; we need more of the second.

November Carnival of Trust is Up

Jordan Furlong, of Law21, is this month’s host of the Carnival of Trust.  He brings a most interesting perspective to it.

Most obviously, Jordan’s a lawyer.  Second, he has that bemused  Canadian perspective about things south of the border.  Finally, two of his interests shine through: innovation and collaboration.

These traits show in his choices, and in his thoughtful commentary linking his choices. 

Jordan has written about trust before.  Perhaps that’s why he moves easily among the various blogposts he has chosen to highlight in this month’s carnival.

Pop on over to the Carnival at Jordan’s site, and here’s a taste of what you’ll get:

– How recent thinking on the economics of law firms has affected client trust levels;

– The effect on trust of both in-court tactics and extra-court marketing;

– The ties linking referrals, trust, innovation and collaboration;

– The relationship between trust and risk;

– How contracts and trust are in some ways opposed.

Add to that a delightful vignette, and a dozen extra-credit mentions.

Good stuff, food for the heart and the brain alike.  Jordan has done fine work here for all thougthful people interested in the subject.

Many thanks, Jordan, for a most excellent Carnival. I invite all readers to go benefit from his hosting.


You can also look at past Carnivals, and enter your own blogposts or those of others for future carnivals by going to the Carnival of Trust homepage.




How to Be a Self-Deprecating Horn-Tooter

shucks meowcheese.comI recently ran for a seat on the condo board of the brand new community I live in. I lost. In front of about 60 people.

My reaction was a mixture of gratitude (“I think I just got spared a LOT of work”), huffiness (“How could they pass ME over?”), and a dash of embarrassment (“Oh no, I think I just looked like an IDIOT in front of a large group of people”).

In reflecting on what worked and didn’t about my little platform speech (I had three minutes to pitch myself to the group), I realized there are some important lessons about trust-based selling to tease out of my defeat.

What Worked

My dominant strategy was to lead with high Intimacy and low Self-Orientation, and to differentiate myself a bit. How? By telling them first why they might NOT want to elect me. I shared openly that I’m a first-time home buyer and had never before been on a condo board – in fact, I had just made my first condo payment ever. My self-deprecation was effective, I think, in that it got a good laugh and set their expectations about what they could and couldn’t count on me for (couldn’t: Board/home ownership expertise; could: honesty and lightheartedness).

What Didn’t Work

There was one thing I didn’t do that left my constituents understandably less than confident in my abilities. I was too humble. I fell into the trap that (sweeping generalization coming) many women do of being tentative about tooting my own horn.

Sure, I told them a little bit about my professional background (close to 20 years in consulting, the latter half with an emphasis on teaming and relationship skills, which lends itself well to community-building endeavors). But I didn’t let them know that when it comes to starting something up (new community, new board), I’m your woman.

I didn’t tell them that eight years ago I launched a business that now boasts a client roster of global companies that generate millions and billions in revenue each year. I didn’t tell them about the community service program I created that, within six months of its inception, was given a prominent mention in SELF magazine and then acquired by a national non-profit.

(Even as I write this, my brain is screaming: Enough with the tooting horns already!)

Bottom line: I didn’t think about what would be of value to them, link that to what I brought to the table, and say it out loud.

What I’d Do Next Time

Of course, this is all speculation; I might have lost because they didn’t like what I was wearing – who knows. I think it’s safe to say, though, that next time I’d be more effective (and certainly less huffy and embarrassed) by doing the following:

– Take five minutes to prepare. Think about what my fellow condo association members might really want in their first set of officers, and know what the link is to my experience and skills.

– Lead with the same opening – why you don’t want to elect me. It’s honest. Plus it’s a little contrarian, and I like that.

– Toot toot toot away. Confidently, succinctly, matter-of-factly, with an emphasis on the aspects of me that directly address their interests and concerns.

I’d leave them with a more complete picture of me–not one that’s either over- or underexposed.

Seems to me these guidelines apply no matter who we are, what we’re selling, and to whom we’re pitching the sale: prepare and be honest about both your strengths and your weaknesses.

That and choose your clothes carefully.

Trust as Risk Mitigation Strategy

Forget how you usually think of the word ‘trust.’ Think instead of ‘risk mitigation.’

“Risk mitigation” means reducing risk to an acceptable level. You’re familiar with it if you work in insurance, investment banking, natural resources, infrastructure, contracting, outsourcing, or deal internationally.

It usually comes packaged as high doses of things hard and practical: legal, financial, statistical. Here’s a typical example, this one from IASTA, a supply and spend management firm, lists seven strategies for risk mitigation. Seven ways, that is, to reduce the riskiness of your supply chain.

No surprise, it includes things like dual-sourcing, price hedging, performance-based contracts, and capacity assurance. Basically, ways to make sure your supplier does what you want them to do.

Risk Mitigation is Usually Based on Control

They are all based on the assumption that unless you control your supplier or the conditions surrounding the deal, you are at risk. And the solutions all involve controlling that risk: mainly controlling that supplier.

What’s surprising about that list—shocking, if you think about it–is the absence of trust. (I’m not picking on IASTA; it’s a good list for what it is—a list of controlling strategies). It generally beats the heck out of all the other seven.

What if you could trust your supplier? What if your supplier behaved toward you in a trustworthy manner? In general, your risk mitigation efforts will then cost a lot less, and will be more successful.

Agreement by legal negotiation, and enforcement by legal, process and accounting argumentation is costly. It causes bad blood. It reduces the felt moral obligation of each party to live up to an agreement. It causes delay. And it sure is expensive.

Risk Mitigation by Trust is Cheaper, and Creates Value

By contrast, trust creation costs less than lawyers and accountants. It can often be created more quickly. And it can be far more dependable.

More importantly: if a trustor-trustee relationship is developed, it doesn’t just cut risk mitigation costs, it positively creates whole new levels of value possibilities. Things you’d never do with an arms-length supplier suddenly become possible.

This is not crazy stuff. The truth is, it happens every day: we just don’t think of it as trust. Trust as risk mitigation happens whenever a customer and a supplier keep an informal rolling ‘tab’ of who owes whom. It happens when a client and a professional honor the spirit, rather than the letter, of an agreement. Warren Buffet did it on a grand scale when he bought McLane Distribution.

Simply put, trust is as hard-nosed a business strategy as any involving the usual suspects. There is no trust without risk: trust truly is at the heart of risk mitigation.

And it’s not that hard to do.

Trust-based Risk Mitigation Requires a Change in Belief

The main thing it requires is a belief in the massively predictable human phenomenon that people do as they are done unto. If one party behaves in a trustworthy manner, the other comes to trust. And if one party behaves in a trusting manner, the other party becomes trustworthy.

The predictability of that behavior is way better than any stock market algorithm. Yet it is astonishing how many businesses have been seduced into inherently untrusting relationships. At great cost to themselves, their supply chain, their customers, and even their shareholders.

It is far more profitable to depend on the rules of trust in human behavior, than to always rely on the rule of ‘do unto others before they do unto you.’ (Which, after all, produces an equally predictable negative counter-reaction). 

The amazing thing is that so many businesses, which claim they are focused on financial returns, continually miss this huge opportunity.  I think it’s because they are also bad at personal risk mitigation: the people who run those ‘hard-nosed’ businesses are personally fearful of constructively confronting other human beings, and of speaking the truth about themselves and others. 

People vastly overrate the risk of doing the wrong thing, while they underrate the risk of not doing the right thing.  In business, as in life.  Fear, to many, seems like the sensible attitude.  In reality, trust pays far higher returns.  In life, as in business.

Trust at O’Hare Airport

I flew Friday night from DC to Kansas City, by way of O’Hare.  That’s redundant, everything is by way of O’Hare.

We left from Gate B8.  I got to my seat, put my MacBook Air in the seatpocket ahead of me, and settled in.  After a few minutes, the pilot announced the equipment had a problem, and would we all please deplane to board another aircraft at Gate B7.

We grumbled but got up to go.  As it happened, I was last out of the plane.  I talked with another passenger for 20 minutes until we boarded the new plane.  I reached into my briefcase to put my computer in the seatpocket and—heart-drop.  I had left it in the other plane at B8.

Why You Can’t Trust Strangers

I ran out the door, back to B8.  The gate agent said the cleaning crew had not been in the plane, and it was empty, but he couldn’t allow me in—he would go look for me.   He did, and after a bit too long, returned—empty-handed.

I ran back to the plane at 7B, whereupon the pilot—same pilot, same crew—came back with me and went in himself.  No computer.

We had to leave for KC .  I filed a baggage report when I got there.  I was cautiously optimistic.  I was 98% confident I had left it in the plane, and 100% sure the only other possibility was the gate area.  I gave it 50% odds I’d see it again.

By end of Saturday, I dropped the odds to 25%.  I emailed O’Hare baggage too.  By Sunday evening, I made plans to replace the computer.  Monday afternoon, 10 minutes before walking into the computer store, I got a phone call. 

It was from Francisco Q., of West Shakespeare Street, Chicago.  He asked for me by name, and told me he had found a computer.  He said he was an employee not of United, but of an O’Hare catering service. 

He hadn’t found it in the plane or the gate area.  It was in an O’Hare parking lot, in a plastic bag.  He said a friend bought a charger (the battery was depleted), and knew how to find my name from the Mac Address Book function. 

Francisco wanted to know how I wanted him to send it to me. I said “fast,” and he agreed to do so.  I was beside myself with relief, and offered him several hundred dollars as a reward.  He said little about that.  I planned to send a check by FedEx to him the next day.

The next day he called to ask, apologetically, if I could send the money before he sent the computer, as it was going to cost him a lot to ship, and he was out the cost of the power cord too.  He asked if he could pick up the money at Western Union–the same day.

Once Burned–Do You Give Up Trusting Strangers?

I can hear what you’re thinking.  But I could hear his voice, and I had no trouble believing him.   I sent him the reward, plus reimbursement for the power cord, and gave him my FedEx account number.  (Do you know how much poor people pay in fees to use Western Union?  No wonder they stay poor).

You can draw your own conclusions about United Airlines ground employees (myself, I still don’t know)–and about Francisco Q.  In fact, you probably already have. 

So tomorrow morning, when FedEx arrives, we’ll know whether or not I was right to trust Francisco.  If I was wrong, I’m not out of pocket just a computer, but a few hundred dollars as well, and will publicly feel stupid.

If I was right, I’ll have my computer a bit faster, and feel better about the human race.  And so will Francisco.  And I think you will too.

I’ll let you know. 

Meanwhile—place your bets in the comments section below.  I’m giving heavy odds on Francisco.

Show Me the Elephant

Why is that leaders and the teams they lead often ignore their issues until they have no choice but to take action? This despite the fact that, more often than not, waiting longer limits their universe of available responses.

I work with a practice group in a professional services firm. They have regular meetings of timekeepers and staff. Lately at those meetings there was an elephant in the room – anxiety about how the economy was going to affect them. Rather than talk about what was really on their minds, they discussed administrative matters and client issues.

In a recent discussion with the practice group leader, I asked – “so what are you and your group going to to do to address the downturn?” My client hadn’t really thought about it. Like many, the leader hoped the team could ride it out. I suggested “name it and claim it." It was simple – raise the issue for the group and talk about it. Some questions to ask:

· How busy are we?
· If we keep doing things the way we are now, what will happen?
· What do we need to do differently?

In such discussions, keep nothing off the table. On the cost side, address reductions – staffing, salary and other expenses. On the revenue side, consider new business activities, think about rates and fixed fee alternatives, figure out how to get paid sooner. Address the issues that have to be addressed. Get cveryone to take ownership of the problem. Put the elephant front and center, and deal with it as a group.

What happened? People got to share their anxieties in an appropriate way, own the problem and develop a solution together. They appreciated the opportunity to think out loud with each other.

Does it really matter why we procrastinate on such issues? Fear is probably at the heart of it. But the origin doesn’t necessarily alter the action. What needs to be done is to name it, so we can claim it.

Do you have an elephant in the room that needs to be called out?

Why People Don’t Trust Trust

In broad terms, what I do for a living is teach (mainly corporate) people to be trustworthy with their business partners, customers and clients.

One of the most frequent objections I get is, “But what you’re suggesting is naïve; it’s too risky, and people will take advantage of you.”
Let me explain why this is a non-sequitur at best, and flat wrong at worst. There are three mistaken assumptions in this claim:

1. Believing that trusting and being trusted are the same
2. Believing you can earn trust without risk
3. Believing that people’s primary instinct is selfishness.

Trust is not symmetrical. To be trusted by someone is not the same thing as trusting someone. When I recommend being trustworthy to my clients, I mean things like admitting when you’re wrong, not fudging your credentials, recommending competitors if they are better for the job, and generally speaking the truth about whatever is going on with you and the other person and the situation at hand.

I have never heard anyone justify lying. But I hear lots of people say they’d never recommend a competitor, or that they’d shade the truth to win a job, or that they’d never acknowledge a situation of discomfort, or call out a dysfunctional client situation. Which as far as I’m concerned means you’re not willing to tell the truth. Which is often only marginally distinct from telling a lie.
But that’s how people talk themselves into not being trusted—that is, by coming up with excuses for not telling very much truth. Which comes across to clients and partners as hiding something. Which makes them distrust you.

Most service providers over-rate credentials and a track record, and underrate the power of telling the truth—all of it. Honesty, transparency, truth-telling, full disclosure—these are the things that lay bare motives, and convince others that nothing is being hidden.

But to the one who would be trusted, these can seem risky steps to take. Admit we made a mistake? Heavens no! They might think we are incompetent; they might be upset; they might fire us; they might not pay the bill. Better to say nothing of it, try to fix things up behind the scenes, and hope they don’t notice it.  But they always notice it. And the coverup is always worse than the crime.

There is no trust without risk. Ronald Reagan’s line “trust but verify” is a rhetorical trick. Trust with verification isn’t trust–it’s more like random drug-testing, which is what happens absent trust.

The one who would be trusted is the one who takes small, initial up front risks—risks of embarrassment, rejection, inadequacy. The one who trusts is the one who generally takes the far bigger, longer-term risk—buying the product, signing the contract.

How silly, then, to risk ruining a large, long-term deal by avoiding a small, short-term deal—out of fear. Yet it happens all the time. We can’t tell them they have a problem in purchasing management—they might be offended. So we’ll just do nothing.

It’s ironic that the largest cause of unwillingness to be trustworthy via truth-telling is the belief that the other party—the one we’d like to trust us—will screw us given the chance.
It has nothing to do with whether people are “good” or “bad,” whether they are or are not out to get you. Those odds vary by industry, geography, and other conditions.

But in almost any population (all right, so maybe Wall Street might be an exception), the willingness to behave at a level of trustworthiness beyond the norm for that population will itself tend to raise the level of trusting as a response. Simply put, people respond to trustworthiness in a reciprocal manner.

If someone behaves in a more trustworthy manner than I am accustomed to—then I am more likely to trust them than I would someone else on average.

What’s so dumb about being trustworthy?