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The Twelve Steps of Business Relationships

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Twelve-step programs are commonly known as ‘recovery’ programs – a structured approach to getting out of a problem situation.  But what if you turned that perspective on its head? What if you saw a program – particularly one with twelve steps – as something to advance you from an already-good situation to an even better, new level of life, thought, and – relationships?

Below are twelve steps to take when looking to grow strong, trust-based business relationships. Easy? Yes. Simple? Well, see for yourself.

With much respect and genuflection to the original source…

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Rarely will you see someone fail in business who has thoroughly followed these simple suggestions. Those who do fail are typically people who are incapable of being honest – with their colleagues, their customers and their partners.

Other problems may temporarily deflect you, but the ability to be rigorously honest will prove immeasurably beneficial in all your business relationships.

Twelve Steps of Business Relationships

Step 1. Accept that you have no power over people, that all your attempts at control have failed. Trying to get other people to do what you want them to do is doomed to failure, no matter how good your intentions, how right your cause, or how much benefit it would bring the other.

People just wanna be free. Go with it.

Step 2. Recognize that by yourself, you can’t succeed. Your success will inevitably be tied up in the success of other people. Not only are you not driving the bus, you are in fact just another passenger.

Step 3. Resolve that you’re going to stop trying to drive the bus – that you’ll start doing things to help other people – that you’ll focus on getting the group to succeed. When things don’t go your way, remember “your way” is what got you into this mess. Repeat steps 1 and 2.

Step 4. Make a list of all the stupid, controlling, selfish things you do to others. Be specific about whom you do them to, and what harm it does to them. Stop at ten people.

Now add to the list a few good things you do. You are, after all, worthwhile.

Step 5. Go share your list with someone you trust. Listen to what they have to say about it and learn from what they have to say. Don’t waste time arguing with them.

Step 6. Get yourself ready to stop behaving in those old ways. Think about it for a while. Make a list of the new things you’ll do. Envision yourself responding in new ways; rehearse new “lines.”

Hint: your list should probably include listening. Also, listening.

Step 7. Pick a time of your own choosing to begin the change. It could be right now, it could be next week, but not next summer. Write that date in your calendar. When it comes, step out of your old ways and start working the new.

Step 8. Think about the customers, co-workers, peers and partners you might have tried to control and what you did to them. Think of what you might have done better and plan to do better next time.

Step 9. Go back to the customers, co-workers and partners you’ve tried to control, and tell them you realize what you have done. Acknowledge your responsibility in those situations, and tell them specifically how you plan to behave differently in future.

Hint: Don’t do this if it causes upset or harm to the other person. Also:  don’t confuse this with trying to get them to forgive you – see Step 1, above.

Step 10. At each day’s end, do a mental run-through of how you did in your new approach. Note where you fell short and what you could have done better.

Then let it go and get a good night’s sleep.

Step 11. Create a little mantra for yourself, to remind you that your job is to help others, not yourself. Get out of the transaction, secure in the idea that better relationships will float all transaction boats.

Step 12. Having recognized how to apply these principles to your business affairs, give it a shot at home and in the rest of your life.  You saw that one coming, right?

Beyond the Sales Process: Interview with authors Dave Stein, Steve Andersen

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BSPangleI have known Dave Stein for many years. He’s an expert in the sales field, particularly in evaluating sales training. He has always been a clear and incisive thinker, with opinions as well-grounded in data as they are in thoughtfulness.

His new book, with Steve Andersen, is called Beyond the Sales Process: 12 Proven Strategies for a Customer-Driven World.

Dave and Steve shared some thoughts with me about the book, and about the state of selling.

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Charlie: B2B selling and buying have been transformed during the past 8 years—what changes have you seen regarding the role of trust in selling? And as salespeople seek to adapt to those changes, how are they doing?

Steve and Dave: Beginning in 2008, when the last financial crisis hit, the concept of increasing revenues as a business objective was forced onto the back burner in many companies and replaced, or at least supplemented, with a scramble to reduce costs. In the process, the procurement function in many organizations gained unprecedented power, became more strategic, and began reaching further into daily operations.

Mostly unprepared for this fundamental transformation in their customers’ business practices, many salespeople found themselves in over their heads, often floundering in their negotiations with “the new procurement.” Under pressure to produce, they responded by upping the ante, throwing more products and services at their customers, despite supply being greater than demand in most cases, and – most importantly – despite the fact that many of their customers simply weren’t interested in these additional offerings.

The result has been a dismaying drop in the degree of trust that many contemporary buyers are able to place in their suppliers.

Charlie: Shocking – who could’ve seen that coming!

Steve and Dave: Right! Anyway, throughout this challenging period we observed consistently that sales professionals and account managers who truly understood their customer’s world—their wants and needs, the potential impact of external drivers on their business objectives, and the internal challenges they faced in meeting those objectives—continued to collaborate with and create value for their customers. For those top performers, earning credibility and focusing on the customer is an approach that continued to pay off.

Charlie: Makes total sense. So, what precipitated the two of you collaborating on a book?

Steve and Dave: After meeting and working together years ago at a software company we became friends and kept in touch as our careers continued on what might be considered parallel but related trajectories. Steve eventually leveraged his experience and expertise in B2B sales to establish Performance Methods Inc. (PMI), an industry-leading sales best practices consulting organization, and Dave authored his first book, “How Winners Sell” and went on to found ES Research Group, Inc. (ESR), an independent advisory firm that focused on B2B sales training.

When Dave closed ESR several years back, Steve seized the moment and proposed that we join forces and share what we have learned and experienced with other B2B sales professionals. A co-authorship was born and it was based on a common perspective—that sales needs to evolve in order to keep up with the changes that buyers have adopted. We also share a real concern that the sales training industry all-too-often leaves the “guest of honor” off the guest lists at the sales training parties: the customer!

Charlie: Indeed – seller-centric sales training is not the right idea. In the face of that drift away from the customer, what impact do you hope this book will have on the reader?

Steve and Dave: In the past eight years, and frankly even in the period leading up to the recession, the idea of a strong, enduring customer relationship has withered and commoditization has reigned. In the fierce competition for customers, value, trust, and credibility have been pushed onto the sales “back seat,” while features, benefits, pricing, and a willingness to discount in order to win business sit up front. Overall, our observation is that this hasn’t been a period of growth for the B2B sales profession, and for that matter, for business in general.

We wrote Beyond the Sales Process because we firmly believe that it’s time to rethink what has become accepted as the new norm—that in business, relationships and trust don’t matter so much any more. We disagree: not only do they matter, but we provide evidence in the book that relationships matter now more than ever.

Charlie: As you might imagine, I couldn’t agree more.

Steve and Dave: As salespeople ourselves, we also know that it’s not enough to simply urge our B2B colleagues (who face these challenges on a daily basis) to change their approach; they must be equipped with how to make those changes. They need to know why it’s crucial to rethink their approach, and they need to know how to implement strategies that will lead to more wins and greater success for themselves, as well as for their customers.

Beyond the Sales Process provides what we refer to in the book as “actionable awareness”—proven strategies and tactics for developing, offering, and creating unique differentiable value that will directly address the customer’s external drivers, business objectives, and internal challenges, as well as their individual wants and needs. And we substantiate this by providing examples of industry-leading companies, their customers, and the actual people that are creating and co-creating this value together.

Charlie: Companies don’t focus enough on developing new business from existing clients. What do you recommend for salespeople, account managers, and sales leaders seeking to build their trustworthiness and grow their relationships with their customers?

Steve and Dave: Most sales book focus primarily on that small period of time when there’s a specific sales opportunity on the table, and that’s absolutely an important topic. But there’s another area that is too-often neglected—“after the sale,” you have an existing customer that has experienced your value. Will they want to work with you again? Did they realize the value that you and your organization promised to deliver? As the salesperson, are you going to stick around to measure and validate the impact you delivered? Are you willing to apply the lessons learned and adapt your approach?

Your past proven value can and should be leveraged to build and strengthen your future relationship with your customer and provide you with momentum for the future potential value that you will create and co-create together. The strategies we lay out in the third section of Beyond the Sales Process provide a clear roadmap for how to make this happen.

Charlie: In your book, you frequently use the word “trust.” Since you know trust is near and dear to my heart, how do you respond to those who believe that relationships in sales don’t matter much anymore? How can you make time for trust in our high-pressure, fast-paced B2B world?

Steve and Dave: We’ve interviewed hundreds of customers over dozens of years, and not a single one has ever told either of us that relationships don’t matter. Credibility is a critical success factor for the contemporary salesperson—so as far as we’re concerned, the real question to ask yourself is this: how can I expect to be successful if I don’t make time to build trust?

This is not just a theory or a philosophical argument. Over and over again, the numbers show that it is considerably more costly to pursue and acquire a new customer than it is to grow your relationship with an existing one. And, when a customer trusts that you have their best interests at heart, there’s a good chance that they’ll want to talk to you, to consult with you, and to hear what you have to say before they start developing requirements for their next specific opportunity. If you haven’t developed a relationship with your customer based on trust, you can expect to hear about their next opportunity at the same time that your competitors do, or worse, you’ll realize that your competitor may have been able to influence your customer’s thinking and view of success while you were waiting for the RFP to arrive.

Before there’s a sales opportunity, the savvy salesperson realizes that they have an opportunity to build trust and credibility by understanding the customer’s world, how they define success, and by visioning value creation together. On the other hand, once the customer is in buying mode, they’re under a great deal of pressure, they’re stressed, and the opportunity to engage differently, explore possibilities, and vision success is lost. If you haven’t already taken the time to establish customer mindshare, you are just one of many providers clamoring for your customer’s attention, and you’ve missed a golden opportunity to build trust.

Charlie: You obviously put considerable work into creating, vetting, and getting approval for your case studies. How were you able to get companies such as these to contribute with such depth? What was it was like working with these industry leaders to capture their successes and best practices?

Steve and Dave: We’ve built trust with these companies over the years, and it’s reflected not only by their full participation in the case studies but also in their willingness to have their own customers to take part. They demonstrate that the twelve proven strategies actually work by using them to create trust-based relationships with their customers themselves. They have embraced the idea that it’s not about control or manipulation, or a methodology that every reader or company has to follow in lockstep, but instead an approach that puts the customer first and creates value for everyone involved. It was an absolute pleasure to work closely with these smart and successful industry leaders, their people, and their customers to give our readers insights and actionable awareness that they can use to ensure their success with their own customers.

Charlie: The market is responding favorably to the concepts in your book, including the notion of engage, win, and grow with your customers. How is this idea more inclusive, holistic, and customer-oriented than traditional sales approaches that have been around for a while?

Steve and Dave: Focusing on benefits rather than features has long been accepted as the “right” way to peddle one’s offerings, but we think it’s an approach doesn’t go nearly far enough. How can you sell on benefits to the customer if you don’t know what they value? How do you establish credibility when it’s obvious you haven’t taken the time to understand the world in which they live? How can you build on the value you’ve created after the sale closes to grow trust and credibility, and to expand your relationship with the customer? In Beyond the Sales Process, we look at all of this, and we equip the reader to implement a new, more contemporary approach for engaging, winning, and growing your customer relationships, and for selling in the customer-driven world in which we live today.

Charlie: That’s a great statement of the value of relationships in selling, and its linkage to some of the more traditional aspects of selling. Thanks guys for taking the time with us today, and best of luck with this excellent new book.

Destroying Trust with Just a Verb

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The Associated Press decided to drop the term “illegal immigrant” from its reporting. Their point: the term ‘illegal’ should be applied to actions, but not to persons. It’s the immigration equivalent of, “hate the game, not the player.”

Of course, that’s red meat to a lion for some. Senator John McCain said, “You can call it whatever you want to, but it’s illegal. There’s a big difference…I’ll continue to call it illegal.” And so the battle is joined. Where one side sees respect, another sees absurd political correctness.

This is a worthless, useless, and totally unnecessary argument. It is also typical of a great many pretend arguments – full of energy and fury, truly signifying nothing.

And who’s the culprit? A verb. To be precise, the verb “to be.” I’m not kidding.

The Tyranny of the Verb “To Be”

In Spanish (and other Romance languages, I think), the English “to be” actually has three forms: estar, tener, and ser. Estar refers to a temporary condition: he is tired, she is in Europe, I’m sick. Tener refers to “having” a passing state – I have hunger, you have thirst, he has luck. Ser, the third form of “to be,” has to do with permanence: he is a man, you are virtuous, she is from the US.

In English, all those forms translate into one word, to be: I am, you are, he is.

Why is that a problem? Consider these interactions:

“The new Bond movie is great.” “No it isn’t, it stinks.”

“He is always negative.” “No, he’s just realistic.”

“You’re not serious.” “I am totally serious!”

“He’s an illegal.” “How can you be so judgmental?”

Because we have only one verb in English to cover so many situations, we end up bludgeoning each other. Since we can’t distinguish our several meanings, we assume others mean the same thing we do.  And when it turns out they meant something else, we chalk it up to obtuseness and  bad will on their part.

Which explains why I always have good intentions – but you! You’re always working some angle.

The American Burden

We’re not about to add two new verbs to American English (I can’t speak for the British or the Strines). But it’s not like we’re handcuffed. All we need is a little clarity of thinking.

1. Distinguish between actions and actors. The AP had this one right. You can still morally condemn people if you want – just don’t be sloppy about your definitions of morality.

2. Distinguish between your preferences and the other’s characteristics. I am not annoying – you are annoyed.

3. Avoid using personal pronouns with “to be” except for “I” and “it.” We have a right to say “I am __.”  We don’t have the same right to say “you are __” or “he is __.”  Only a rocking chair is oblivious to the difference.

I am fairly confident it’ll work for you. Unless you’re seriously pigheaded, that is.

This post first appeared on TrustMatters.

Integrity: What’s Up With That?

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Like trust, integrity is something we all talk about, meaning many different things, but always assuming that everyone else means just what we do.  That leads to some vagueness and confusion. But a careful examination of how we use the words in common language is useful.

Integrity and the Dictionary

Merriam Webster says it’s “the quality of being honest and fair,” and/or “the state of being complete or whole.”

If you’re into derivations of words (as I am), then it’s the second of these definitions that rings true. The root of “integrity” is Latin, integer.  That suggests the heart of the matter (integral), and an entirety. “Integer” also has the sense of a non-fractional number, i.e. whole, not fragmented, complete.

In manufacturing, we have the idea of “surface integrity,” the effect that a machined surface has on the performance of the product in question: integrity here means keeping a package of specified performance levels intact. Similarly, a high-integrity steel beam is one that will not break or otherwise become compromised within certain parameters of stress.

Related also to this theme of wholeness is the idea of transparency, of things being whole, complete, not hidden – in this sense, we have high integrity to the extent we appear the same way to all people. Think of the phrase “two-faced” as an example of someone without integrity. (For a somewhat different and nuanced take on this issue in cyberspace, see @danahboyd on Mark Zuckerberg and multiple online identities).

Sometimes when we say someone has integrity, we mean they act consistently, in accord with principles. We say someone has high integrity when they stick to their guns, even in the face of resistance or difficulty.

Which raises an interesting question: where’s the line between integrity and obstinacy? For that matter, can a politician who believes passionately in the art of compromise ever be considered to have high integrity?

Then there’s that other common use of integrity that has a moral overtone – honorable, honest, upright, virtuous, and decent. Some of it has to do with truth-telling; but some of it has to do with pursuing a moral code.

Yet that raises another interesting question: can a gang member or a mafioso be considered to have integrity? Can an Occupy person ever consider a Wall Streeter to have integrity? Or vice versa? There may be honor among thieves, but can there be integrity?

Integrity – Your Choice?

So which is it?  Does integrity mean you tell the truth? Does it mean you operate from values? Does it mean you always keep your word? Does it mean you live a moral life? Does it mean your life is an open book?

Let’s be clear: there is no “right” answer. Words like “integrity” mean whatever we choose to make them mean; there is no objective “meaning” that exists in a way that can be arbitrated.

But that makes it even more important that we be clear about what we do mean. It just helps in communication.

For my part, I’m going to use “integrity” mainly to mean whole, complete, transparent, evident-to-all, untainted, what-you-see-is-what-you-get.

For other common meanings of “integrity,” I’m going to stick with synonyms like credible or honest; or moral and upright; or consistent.

What do you mean when you think of integrity?

This post first appeared on TrustMatters.

When the Client Cuts Your Face Time in Half

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Are you having trouble with scheduled client meetings getting blown off?

For example: your progress update meeting with the client is scheduled for an hour, starting at 11AM. You’re hopeful it might extend to a lunch invitation.

11AM comes and goes, and the client is still in a meeting. Word comes from the client’s AA that the meeting has to move to 2PM. At 1:30, it gets kicked to 5:30 – and it’s cut to half an hour, as the client really has to leave no later than 6PM.

What do you do?

This came up in a large workshop recently; the setting was such that only a 1-minute answer was appropriate.  I gave the 1-minute answer – and I’ll include the longer answer here.

Involve the Client in Problem Resolution 

The quick answer is you start the meeting by saying something like, “Listen, it’s late in the day, and it sounds like yours has been hectic. Ending up in a review session may not be your idea of a good time. Would you rather reschedule?”

And then go with the client’s answer, whatever it is. If the client prefers to push on, then do so. And you’d better be willing to trim your presentation to 30 minutes, rather than trying to double-time it, or passive-aggressively running out of time.

The principle here is to make the client part of the problem resolution.

Involve the Client in Problem Definition

The longer answer is to make the client part of the problem definition – not just problem resolution. Why is it that a previously scheduled meeting slipped so drastically?  That it got cut in half?  That’s a discussion worth having on occasion.

Is it because the client doesn’t particularly care about an update, and it’s really your need for approval that’s driving the meeting? Are you able to specify real decisions that are needed from the client? Is this a box-ticking meeting to fulfill your internal processes? Are you trying to cover your behind? Do you know what the meeting was bumped for, and are you satisfied with the decision? Is this a meeting that neither one of you really wants, resulting in joint procrastination – and if so, what’s that about?

The answers may be perfectly innocuous, or they may uncover a deeper issue – where there’s smoke, there might be fire. The point is not about the answers – it’s about having the vulnerability and courage to re-invite the client to visit the tough questions, to define the issues jointly.

 

The Trusted Executive: John Blakey

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John Blakey is a UK-based author, speaker and executive coach. He just came out with a new book, The Trusted Executive. In this issue of Trust Matters, I chat with him about the book, and about his view of trust.

John, welcome to Trust Matters. You’ve got a new book out – The Trusted Executive. It’s your second book, right? Why did you write this book?

You could say this book is the story of my life! And hopefully, the story of all our lives at least in some part. It’s about how trust is lost and how trust can be regained.

I was reminded of this by the events of the global financial crisis of 2008-2009; a time when trust in ‘big business’ was lost and we all paid the price. A devastating event that jarred our notions of what we expect from executive leadership. Sometimes it’s helpful to forget the impact of such a breach of trust, to move on and to keep yourself busy. But other times we need to stop and think and learn the lessons we need to learn.

My own response was to first write a book called ‘Challenging Coaching’ with my colleague, Ian Day. The purpose of this book was to help the executive coaching profession learn the lessons it needed to learn from the global financial crisis. I then enrolled on an executive doctorate at Aston Business School in 2012, because I wanted to research the lessons that the wider world of business leadership needed to learn from the events of 2008-2009. This research path led me to the work on trust and I devoured the academic literature, before interviewing a host of CEOs on the topic of trust, including those in the UK, US, Europe and Asia. Gradually, my thoughts became clearer and ‘The Trusted Executive’ started to be written.

At the end of the day, I care about the reputation of business and it makes me sad that this reputation has been damaged in recent years. I have committed thirty years of my career to being a business leader, whether that be as the international managing director of a global multi-national or as an award-winning entrepreneur. Like many others, I came into business because I thought it was a force for good in the world. It seems we are at risk of losing that reputation and we need to show we care about getting that reputation back.

Excellent, thank you. I am aware, as of course are you, of the dwindling levels of trust in business these days. Say something about that?

The topic of trust has been brought to the fore by a number of recent events. Not just the global financial crisis I have just mentioned, but also the series of corporate failures and scandals that have occurred since 2008 – the events at FIFA, Volkswagen Group, Barclays Bank and BP.

Against this backdrop, the trustworthiness of business organisations continues to suffer. The 2014 Edelman Trust Barometer found that only one in five public respondents trusted business leaders to tell the truth and make ethical and moral decisions. Furthermore, only 43 per cent of respondents would trust a company CEO (compared to 62 per cent who would trust ‘someone like myself’.)

A recent paper from the Council on Business & Society summed up the mood when it stated ‘Society’s trust in corporations and their executives is dismally low, with the crisis in leadership fuelled by a relentless media cycle and a growing consumer influence through the global spread of information and viewpoints over the internet.’

Give my readers a quick story line of the book, if you would please?

The story goes like this:

In the old model of business, leaders worshipped profit and got things done through intellectual ability and authority. This worked to a degree and for a while. But transparency has broken the old model. Through globalization, diversity, technology and shifting demographics we now see through the opaque lives of organisations. As a result, we have lost trust in authority and lost trust in organisations and leaders who worship profit.

Authority as the glue of organizational life is no longer sufficiently ‘sticky’ to hold it all together. We need a new glue. The new glue of business of is partly a broader sense of purpose (results, relationships and reputation) and partly a deeper bonding of stakeholders through trust. Leaders need to take their trust-building skills to a completely new level if they are to create this new glue of 21st century business life.

Of course, the devil is in the details. What’s your view of how we do that?

Building trust is not as simple as delivering on your promises. I posit trustworthiness as ability x integrity x benevolence. For each pillar of trustworthiness, the book proposes three habits that modern leaders need to master. Typically, our understanding of trust has amounted to solving only 10% of the problem. Successful leaders will master all nine habits.

Some habits are familiar to us, such as choosing to deliver, to be honest and to be open. Others are more radical and challenging such as choosing to be morally brave, to be kind and to be humble.

Through these habits we will architect a new business model populated by trusted executives. This will be a model fit for diverse 21st century stakeholder of business and a model that will drive not just financial results but also inspiring relationships and a positive, long term reputation.

Give me a specific example, if you would? Say, a habit from the integrity section?

Under the pillar of integrity there are three habits – choosing to be honest, choosing to be open and choosing to be humble. If we take choosing to be open as an example, according to a 2014 survey of 1,600 managers in the UK by the Institute of Leadership & Management, openness is by far the most significant driver of trust. This finding was backed up by various CEO comments in my own research interviews such as ‘The first way to build trustworthiness is through open communication.

Consistent, open communication builds a belief that you are being told everything you need to be told’ and, ‘As a Chair going into a company, I get an instinct about the CEO. It’s really important what my gut feeling says about their trustworthiness. I’m testing it out all the time. I’m watching how open they are.’

But openness is not simply about telling the truth. Being open goes beyond being honest; it involves speaking the truth and then giving something more. Being open requires a leader to expose themselves and reveal some vulnerability. As Patrick Lencioni, puts it, choosing to be open involves ‘getting naked’.

In the book, I explore how leaders can show appropriate vulnerability and openness without undermining their credibility in front of their followers. At its root, this involves reframing their perception of vulnerability as a strength of the modern, 21st century leader who is focussed upon building trust rather than a weakness of the 20th century leader who was focussed upon winning battles regardless of the longer term cost to their underlying relationships.

What is your greatest wish for the book?

That it spark a debate in the boardroom regarding the role of trust in a modern business. I hope it will make CEOs and corporate leaders sit up and think again about their individual role in the trust-building challenge and so inspire them to commit to new habits for themselves and their organisations.

Beyond this, it would then be a bonus if the book’s impact leaks further outside the business realm into the worlds of education, politics, sports and parenting, where trust is also a key driver of success and sustainability.

I have a colleague in Slovakia who is writing a version of the book for 10-12 year olds which will convert the book’s messages into a parable for children based on the progress of a sports team competing in a handball tournament. I was initially surprised that he saw the relevance of the book to children, but then I suppose trust is something inherent to all successful relationships whatever your age or your profession.

How can the book help business leaders at a practical level?

It should help them to deliver outstanding results; inspire relationships; and leave a positive long term legacy.

I hope that after reading the book, business leaders will understand why trust is such an important driver of success, and why it is becoming ever more critical in a world where nothing can be hidden. The models in the book will help leaders translate this understanding into practical steps to improve their own trustworthiness and that of the organization as a whole.

On the one hand, this involves role-modelling specific behaviours on a day to day basis. On the other, it involves leading transformational change across the whole organization and instilling a culture of trust. It is both a micro and macro level challenge.

We also know that we all make mistakes. The book will help leaders recover from mistakes where trust has been damaged quickly and effectively through using proven coaching techniques that I’ve practiced myself and taught to over 120 CEOs across 22 different countries in my role as an executive coach.

If you could share only three insights about trust with a business leader what would these be?

First, I’d stress that trust matters. Whether you look at the academic research or listen to the front-line leaders, that it is clear. In 2002, Tony Simons and Judi Parks at Cornell University conducted a survey of more than 6,500 employees at 76 US and Canadian Holiday Inn hotels. They discovered that a one-eighth improvement in a hotel’s score on leadership trustworthiness led to a 2.5% increase in profitability. They concluded that ‘no other single aspect of manager behaviour that we measured had as large an impact on profits’.

Second, you cannot control trust. According to Rousseau, ‘Trust is a psychological state that comprises the intention to accept vulnerability based upon positive expectations of the intentions or behaviour of another’. It is my psychological state and my decision. Whatever you as the leader thinks, says or does, you cannot force me to trust you. However, as a leader, you can influence my decision and what influences my decision is your level of trustworthiness.

Finally, trust and authority are not the same thing. In the past, we trusted people because we were told to trust them by people in authority. When you were a child, you watched the politician speaking on TV and you might have said, “he looks a bit shifty to me”, and, no sooner had the words left your lips, your mother would snap back, “But you should trust the politicians!” “Why mum?”, “Because they are politicians”.

That is how it used to work, but this model is breaking down. As part of my research into trust, I interviewed Ben Page, CEO of the market research company, IPSOS Mori. Ben told me that their surveys reveal the level of deference to authority is dropping with each successive generation. Today, he says, only 29% of us believe that those in charge know best.

Who inspires you as a trusted executive in the business world?

There are some great role models out there, but if I had to pick one it would be Paul Polman, the CEO of Unilever. When it comes to ‘big business’, they don’t come much bigger. They have 172,000 employees, annual revenues of more than $50 billion and sell products in 190 countries.

When Polman was appointed CEO in 2009, he launched the company’s ‘Sustainable Living Plan’, which has since become a benchmark for triple bottom line thinking. The ‘Sustainable Living Plan’ aims to reduce Unilever’s environmental footprint and increase its positive social impact while also doubling sales and increasing long-term profitability. In 2014, a review of the ‘Sustainable Living Plan’ revealed the following progress:

  • Unilever’s ‘Sustainable Living’ brands accounted for half of the company’s growth and were growing at twice the rate of the rest of the business.
  • More than 55 per cent of Unilever’s agricultural raw materials were being sustainably sourced, more than half way to the 2020 target of 100 per cent.
  • CO2 emissions from energy and water in manufacturing had reduced by 37 per cent and 32 per cent per tonne of production respectively.
  • Unilever had improved the health and wellbeing of 397 million people; 40 per cent of the way towards its 2020 goal.

The punchline is that, in the same period, Unilever’s share price rose by more than 40 per cent! The story of Unilever under Paul Polman’s stewardship shows that a company can deliver results, relationships and a positive long term reputation in society as a whole. It is an inspiring story and I was privileged that Paul wrote the foreword to my book because I can think of no-one else who is currently ‘walking the talk’ as well as he does.

 

Thanks John for taking the time to share your thoughts.

 

Can Trust Replace Contracts?

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Too often trust is thought of as a nice-to-have but vaguely soft, squishy, liberal sort of relationship thingy. Not often enough do we realize it also holds the key to reducing costs and time, and to fostering innovation and new value creation.  It also mitigates risk.

It’s true: trust is highly profitable. Consider how Warren Buffett acquired McLean Distribution from Walmart. By deciding to trust the management team at Walmart, Buffett reached an agreement in a matter of days and at minimal cost, saving months and many millions in cost.

You may be saying, ‘Fine—but who’s going to double-cross Warren Buffett? It’s different for him.”

I don’t think so. Let me add my own small lesson.

To Sign a Contract? Or to Trust?

In addition to speaking and writing, I run a seminar business. I’ve spent this week training a half dozen worldwide potential trainers, sharing with them all the training manuals, approaches, ideas and concepts that I have developed over the years.

Normal procedure would be for me to have them all sign a non-disclosure agreement to protect my intellectual property, which is, after all, the source of my livelihood. Such agreements can be more or less complex. If violated, they give me the legal right to pursue redress in courts in various countries should one of my licensees/coaches/contractors abscond with my materials or be found to be using them for their own purposes without properly getting my approval or compensating me appropriately.

I could have done that.

Instead, I explained to them that I would prefer to trust them to do the right thing. We went through a 60-second ceremony. All of us raised our hands and, looking at each other, pledged two things: to respect my intellectual property in the commonsense way they felt was right; and if there was any question about what that meant, to talk to me and the rest of our team about it.

No papers. No contracts. Nothing written. Not enforceable in any court of law.

Where’s the Enforceability in Trust?

I feel more protected by this oath than I do by any legal agreement I might have signed. Why? Certainly not because it’s enforceable in a court of law.

Rather, because it’s enforceable in a higher court; the one of their conscience. Conscience is triggered by conscious, collaborative relationships between human beings.

I have no doubt that this group of people, with whom I have worked closely over several days and for months preceding this gathering, will honor the pledge. I trust them. This is partly because of who I know them to be, and also partly because I trust them.

Trust is not something you work on directly; trust is a result. It is the result of two parties interacting: one who trusts, and the other who is trusted. You can practice both trusting and being trustworthy. Probably the fastest way to make people more trustworthy is to trust them first.

Is it risky? Of course.  But I think it is less risky than relying on the rather impersonal and tenuous threads of trademark law. My recourse to legal violations is courts, which are costly, time-consuming, and generally manufacture ill-will in the pursuit of their justice.

By contrast, trusting my business relationships itself increases their trustworthiness, which also lowers my risk–and at near-zero cost. My means of enforcement is pre-installed within them in the form of their consciences.

It’s a win-win. Except maybe for the lawyers.

And frankly I think there’s room for lawyers to gain from this too. But that’s another blog.

 

This post first appeared on TrustMatters. 

The Dirty Little Secret about Subject Matter Expertise in Sales

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It may be the dirtiest little secret in professional sales. The lie we all love to tell ourselves. The truth we just hate to face up to. What secret/lie/truth is that?

The myth of the subject matter expert as key to sales success.

Sources of Mythology about Subject Matter Experts

There is no shortage of prognosticators about the increasing importance of subject matter expertise. You’ve probably seen a lot of it:

  • You may have heard from The Challenger Sale folks that if you’re not coming up with new insights about your customers’ business, then you’re a relationship wimp.
  • You may have seen the article Top Ten Trends in Sales and Business Development, which lists the rise of the subject matter expert as number one on the list.
  • You may have read the Canadian Professional Sales Association article The Rise of the Subject Matter Expert, which says B2B organizations are increasingly turning to subject matter experts.

What all of those pieces have in common is an underlying view of the buying decision as rational, calculating, value-based, and economically driven. And that’s Just. Not. True. That’s the dirty little secret.

To be precise, it’s not that buyers are irrational. Nor are economics or rational thought irrelevant. But the role we ascribe to such thinking is profoundly mislabeled by an awful lot of sales “experts.”

So, let’s get it right.

There are two types of thinking, there are two stages in B2B buying (which largely correspond to those types), and there are two logical roles in the buying process (necessity and sufficiency). When we get it right, those all drop into place, including the role of subject matter expertise.

Two Types of Thinking

Daniel Kahneman, in his book Thinking Fast and Slow, outlines two types of cognition. The first, System 1, is fast, is intuitive, and jumps to instinctive reactions or conclusions. System 2 is the slower, logically deduced, careful check. His book (and his life’s work) consists of showing over and over how much our lives are controlled by System 1, contrary to popular belief.

A similar point is made by Jonathan Haidt in his brilliant book The Righteous Mind: Why Good People Are Divided by Religion and Politics. He uses the metaphor of the elephant and the elephant driver. The latter thinks he is in charge, but in fact the elephant pretty much does what the elephant wants.

If you prefer the same idea in a far more accessible and practical manner, read Josh Waitzkin’s The Art of Learning, in which he explains how he became a junior globally ranked chess champion and then a world champion in the martial art Tai Chi Chuan.

How’d he do it? He learned the link between thinking fast and slow thinking; he learned when and how to use the elephant and when to use the elephant driver. He drilled over and over the most minute movements, strategies, and counters until they became subconscious and he could trust them with “fast thinking”—thereby reserving his “slow thinking” to focus on that one, single differentiating move.

The point is not that one is right and the other wrong. They are both necessary to human functioning, but they play different roles.

Two Stages in B2B Buying

David Maister originally observed that most B2B buying processes proceed in two stages: screening and selection. In the screening process, staff people typically “round up the usual suspects,” putting criteria on spreadsheets and evaluating who should be in the “final four.” That is a prototypical rational process—think spreadsheets, analysis, and quantitative tools—which is why it’s delegated to junior staff.

Then there’s selection. Selection is heavily instinctive, intuitive, and non-rational. Selection is done by senior people who are experienced, have confidence in their judgment, and have the track record to back it up. But of course they don’t claim clairvoyance or rely on gut feeling. No, they rationalize their instincts. To put it prosaically, people decide with their hearts, then rationalize the decision with their brains.

Two Logical Roles: Necessity and Sufficiency

Some things you must have in order to get other things. On the other hand, some things are all you need. Writing a term paper may be necessary to get an A in the course, but writing a paper alone isn’t sufficient to get that A. We often mistake necessity for sufficiency. And subject matter mastery is a classic example.

In B2B sales, it is pretty much necessary to have and demonstrate subject matter expertise. In fact, such expertise is specifically looked for in the screening process assigned to junior staff. The absence of subject matter expertise is often justification for being removed from the final list of firms invited to present.

But subject matter expertise is far from sufficient (the same is true of low price). You’ve seen plenty of cases where neither the lowest price nor the highest technical ability got the job. Instead, the job frequently goes to the seller who is “good enough” on technical (and price) terms, but who clearly has a better trusting relationship with the client.

Interestingly, often this is not stated. In fact, it’s even denied. Selection decisions, which are made with the intuitive, “fast thinking” mind are often rationalized by referring back to the “slow thinking” rational criteria that were employed during the screening phase.

Putting It Together: Revealing the Dirty Little Secret

The dirty little secret is that subject matter expertise plays two important, but precise and limited roles. The first is to screen out uncompetitive offerings up front, so that time is not wasted on providers that are least likely to win. This role is finished once the finalists are selected.

The second role is to rationalize the decisions that are made by the “fast thinking” mind, the “elephant” mind, the subconsciously competent mind that has absorbed experience and can trust its own intuition. Here the rational mind is the handmaiden of instinct and experience.

The buyer may tell you and everyone else that you won the job because of your expertise and credentials and that competitor B lost it because they weren’t as brilliant as you. But don’t you believe it.

You won because you were good enough on the expertise side of things and the client loved you. That means they felt you had integrity, they could get along with you, they could be honest with you, you’d be straight with them, and that if there were problems, they could work them out with you—and not with those other folks.

The dirty little secret is the same thing that popular girl told you in high school when you invited her out and she said, “Oh, I’m so sorry, I’m busy Friday night.” She wasn’t busy; she just didn’t want to go out with you. “Busy” was the socially acceptable excuse of high school dating. “Expertise” is the socially acceptable excuse of B2B buyers.

You gotta have it, but don’t kid yourself that it’s enough.

 

This post first appeared on RainToday.com 

How Smart People Get Stupid

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Exhibit A. Google conducted a multi-year, multi-million dollar study called Project Aristotle to determine just what distinguishes successful teams from unsuccessful ones. Tons of data were examined, decades of research studied, multiple hypotheses explored.

The answer? Drum roll: successful team members display more sensitivity toward their colleagues, e.g. granting them equal talk time.

THAT’S IT!

If you find that a stunningly unsurprising flash of the obvious, you don’t understand how things work in business these days. Here’s the reaction of one Googler to that study:

“‘Just having data that proves to people that these things are worth paying attention to sometimes is the most important step in getting them to actually pay attention…I had research telling me that it was O.K. to follow my gut,’’ she said. ‘‘So that’s what I did. The data helped me feel safe enough to do what I thought was right.’’

I’m not picking on Google; they are not unique. (And they are, indeed, really smart). But let me restate what Exhibit A is really telling us:

Millions of years of evolution have brought humans incredibly complex and exquisitely tuned neurological systems, capable of instantly intuiting not just friend vs. foe, but parsing a spectacularly wide array of emotional messages being sent out by our fellow humans.

Yet the smartest of the smart among us have determined that you can’t trust that system – unless it’s backed up by years of technological research that couldn’t have been done even just ten years ago.  Fortunately, we have now been given permission by that research to ‘trust your gut.’

It’s a wonder the human race stumbled along without that study for so many years.

 

Exhibit B. We recently got a plaintive email from a genuinely perplexed  client.

He said:

I hear constantly that being authentic is crucial. But it’s hard to get a clear grasp on the idea. It’s especially hard to figure out how I can know (instead of just feeling or believing) that I am authentic – much less know that someone else is.

Absent knowing we’re authentic, can’t anyone believing they’re authentic just claim to be so? How could anyone prove otherwise?  And since we can’t really know authenticity, doesn’t that also mean we can’t measure it, so we can’t compare it across people or time or situations?

Hasn’t someone come up with a way of getting at authenticity by way of knowing, rather than feeling or believing? I’m struggling to know how I can know I’m authentic. I hope this makes some sense.

This person’s pain is real, and deep; I don’t want to appear insensitive by citing it as a cautionary example, we can all relate to the sentiment. Yet, contrary to their hope, the query makes no good sense at all. Instead, it represents the abandonment of commonsense.

Authenticity – to pick that particular example – speaks to an alignment of beliefs and feelings with the cognitive functions that our writer called “knowing.”  When we run across someone who accesses solely their cognitive talents, we don’t think of them as authentic – we think of them as Sheldon Cooper. They are inauthentic because they are presenting not their full selves, but only their frontal cortexes to others.

“Authentic” is what we feel instantly in our pre- and sub-conscious instinctive feelings about other people. It is the same kind of feeling we get when we jump away from the speeding car, recoil at the sight of a snake, or feel our hearts tug when a puppy wags its tail at us.

An Outbreak of Reductionism

This is hardly the first outbreak of hyper-rationalization. In the social sciences it has a name – physics envy. It is particularly virulent today in neuroscience, where some, having locating certain emotions in particular areas of the brain, claim to have “explained” those emotions. Description is by far the narrowest form of explanation – it’s more akin to translation.

But the disease affects business as well. We have no trouble smiling at the naiveté of Frederick Taylor and his stopwatch, measuring people like machines. Yet we are every bit as mechanical and naive today.

Today, it is an article of faith in many of our most successful companies that “management” is a matter of decomposing goals into a series of cascading behaviors which, properly measured and carefully matched to incentives, produce an internally consistent, humming machine. All you need is a dashboard, which is easily available in the form of widgets.

The manifestation of this belief system (codified in “if you can’t measure it you can’t manage it”) is the enormous investment in training, goal-setting, reporting, progress discussion, and performance reviews – all of them non-direct value-adding processes.  All of them are built around a behavioral view of meaningfulness, a pyramid view of behaviors, and a system for metrics and incentives.

Every training department knows to use the Skinnerian language (“attendees will learn the behaviors associated with mastering the skills of XYZ…and will be rated regularly thereafter on a four-point scale of Early, Maturing, Mature, and Master.”)

Petrification by Metrification

This is precisely the technique used decades ago by Harold Geneen, who believed in rolling up data from all his subsidiaries and managing by the numbers. Except Geneen was measuring profit margins, inventory turns and capital costs. (And it turned out it was Geneen’s outsized personality, not his system, that made it work).

Today’s managers are applying the Geneen model to manage things like trust, authenticity, ethics and vulnerability – with the same tools they apply to measuring click-through rates. There is a huge mismatch. Entire organizations – and not just Left-coast tech companies – are being managed by cascading goals and KPIs, each firm with its own acronym for the process.

This continued reduction of higher order human functions to behavioral minutiae, coupled with the rats-and-cheese-in-the-maze approach to incentives, succeeds only in hollowing out those functions. Try this thought experiment: How do you incent unselfishness?

In the words of ex-consultant and CEO Jim McCurry, all this leads to “petrification by metrification.”  You don’t get the genuine article, but a fossilized replica. It may look real, but it’s checkbox stuff.

Scaling the Soft Skills

George Burns once said, “The most important thing in life is sincerity; if you can fake that, you’ve got it made.”

Ironically, the management teams who try to apply Big Data techniques to rich, basic human interactions are swimming upstream. The right way to scale soft skills and sensitivity not only looks different than the way you incent car  salespeople, but it’s a lot cheaper and faster. It has to do with leading with values, engineering conversations, and role-modeling.

But that’s fodder for another blogpost.

 

 

 

Can Trust Be Taught?

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Let’s not mince words. The answer, pretty much, is yes.

The exception is what the academics call social trust—a generalized inclination to think well or ill of the intentions of strangers in the aggregate. That kind of trust ends up being inherited from your Scandinavian grandparents (or not, from your Italian grandparents).

The rest, let’s break it down. First, enough talk about “trust.” Trust takes two to tango. One to trust, another to be trusted. They are not the same thing.

So let’s start by asking which we want to teach: to trust, or to be trustworthy?

Trusting someone is, paradoxically, often the fastest way to make that other person trustworthy—thereby creating a relationship of trust.  People tend to live up, or down, to others’ expectations. So if you can muster the ability to trust another, you’re both likely to reap big returns quickly from the resultant trust.

However: trusting can also be a high risk proposition. The vast majority of business people, on hearing “trust,” will say “that’s too risky.” In other words, they hear “trust” as meaning “trusting,” and they turn off.

On the other hand, there is being trustworthy. If you consistently behave in a trustworthy manner, others will come to trust you, and voila, you have that trusting relationship. Being trustworthy tends to take longer than trusting, but the results are just as good. And, it’s very low risk.

Let me say that again: becoming trustworthy is a low risk, high payoff proposition. This is not a hard concept for people to get, if explained right.

What does it mean to be trustworthy? The trust equation explains it: it’s a combination of credibility, reliability, intimacy, and a low level of self-orientation. You can take a self-assessment test of your own TQ, or Trust Quotient, based on the trust equation.

So the question is: can people be taught to become more credible? More reliable? More capable of emotional connectedness? More other-oriented and less self-oriented?

The answer is yes. Big picture, there are two ways to teach these things. One is to recall Aristotle’s maxim: “We are what we repeatedly do. Excellence, therefore, is not an act, but a habit.”

People can be taught truth-telling, reliability, even other-orientation to some extent by showing them the behaviors—particularly the language–of trustworthy people.

But the deeper, more powerful approach to building trustworthy people starts the other way around: by working on thoughts to drive action. As the Burnham Rosen group articulates this point  “thought drives actions which result in outcomes.”

Many disciplines outside of business know the truth and power of this approach: psychology, acting, public speaking, to name a few. Business doesn’t appreciate it enough. But commonsense does.

Trust can be taught: either by teaching trusting, or trustworthiness. The latter is lower risk, hence the most attractive approach for many in business.  And trustworthiness can be taught via a mix of skillsets and mindsets

It makes sense.