Which Path Will You Take in Modern Business Relationships?
Updated: May 7, 2021
We've heard it for many years, "it's all about relationships," "it's not what you know, it's who you know" Of course with recent events this idea is presenting us with new dynamics and new choices. Times have changed – right? Surely, it's not still all about the palm pressing and back slapping on the golf courses and in restaurants across the world? It’s no longer just about the old network, surely, we're more sophisticated now? We've moved on from these elementary ideas realizing that there must be something more. Alas, these are confusing times forcing us to choose which path to follow.
Believing that "relationships" might have been abused over the years, companies increasingly discourage business intimacy for fear of bias in buying decisions. Conversely, sellers struggling to differentiate themselves emphasize relationships even more vigorously. On top of all that millennials behave differently in communications and engagement causing us to question the very nature of future human relations. Companies continue to reduce cost by converting field sales teams to inside groups, grappling with forced remote selling further changing relationship dynamics. Trust remains elusive as people become more physically remote. It all adds up to more questions than answers.
What's in a Modern Relationship Anyway?
To be clear, while we're restricting ourselves here to business relationships, we acknowledge the difficulty in splitting the business from the personal. Relationship dynamics in business do not sit neatly to one side and are therefore prone to our subconscious, biases and human motivations. We cannot deny the existence of a natural set of dynamics in human relations that inevitably overflow into business.
That said, what are relationships, and specifically what do they mean in business? These seem like simple questions with obvious answers. They are not. There are many definitions out there we could use to frame this conversation. "Relationship selling is a sales tactic in which the seller works on building relationships with people instead of using traditional sales tactics. When enough people in your marketplace know, like, and trust you, sales are the natural result. Relationship selling is based on authenticity, genuine concern, and honesty." A more clinical and cynical definition one could not find, immediately demonstrating one of the major concerns – the disingenuous nature of the contrived form of the business relationship.
In Tony Hughes’s the Joshua Principle, Hughes maintains that we need "to build a relationship to enable the prospect to share the vision" of the solution. In other words, you cannot meaningfully share the vision of the solution with the prospect unless they can see it, and for them to see it, we must have a relationship, of some form in the first place. The challenge here is the classic "chicken and egg" – I need the opportunity to build a relationship so you can share my vision, but the prospect wants to see the vision before devoting time to that relationship.
Educator and author, J.C. Quintana notes in his book Serious Relationships – The 7 Elements of Successful Business Relationships, the similarities between the stages of development of business and personal relationships. Quintana advises that business relationships must be defined. For example, "an association between individuals or companies entered into for commercial purposes and sometimes formalized with legal contracts and agreements." He believes qualifying questions must be asked around Value; what value is expected, required, anticipated and received. He says we should ask questions around boundaries and roles; what rules and terms regulate the relationship and Risk Management; how we plan to balance the risks and rewards. These all seem like good points and questions, but I have never heard leaders, and sales teams speak in this fashion about their relationships. That's not saying that they shouldn't.
Forced Friendships – The Formal Approach
There's an awful lot of ink out there on how to find, build, manage and refine relationships. The contrived nature of this is…. well contrived, and it is easy to be naturally skeptical, suspecting the authenticity of these relationships in the first place. What we're looking at here are business relationships designed to foster business transactions. So, no surprise that they're prone to suspicion. Maybe the team at Sirius can help us frame this conversation as we return to using one of their tried, trusted and most enduring of models – The Demand Spectrum.
Sirius maintains that "all b-to-b demand creation is not created equal; there are three core demand "types." Determining the demand type drives several fundamental marketing and sales decisions. If sales and marketing can't agree on-demand type, systematic demand creation will be nearly impossible.
Maybe the framework can also help us illuminate the type of available relationships, and that is required within these three groups. In the Established Market, the dynamics look more transactional and commoditized. Nearly all companies have already made a choice and must see the value in switching. Because value and feature-benefits are premium here, differentiation is vital. As we know, differentiation is challenging these days, so while we used the word transactional earlier, (implying buying and selling here is all about price and delivery) this category could be more dependent on relationships as companies struggle to differentiate using features and benefits. Maybe the relationship is the ONLY way to achieve differentiation here.
In the New Paradigm "offerings must show how their approach is better than solutions currently being employed." Companies need to compete with the existing model as opposed to specific competitors. Sellers must focus on disrupting the status quo with confident sellers able to reassure wary buyers.
According to Sirius “New Concept" offerings require work to get buyers to recognize a need they didn’t know they had.” This takes longer and requires engaging external advisors to spread the word and POC's for beta customers. Companies must be willing to assume a thought leadership role and act accordingly to raise awareness, attracting interest in problems companies didn't know they had. Sellers must be evangelists, willing to lead with insights and challenge conventional thinking.
The Demand Type model is a useful tool to guide our thinking. It doesn't completely answer the questions on relationships in business, but it can provide us with better questions to ask. It's obvious where we fit in some cases, but confusing when we fit into multiple categories. Then you must consider recruiting and managing a hybrid sales force where some sellers are comfortable creating demand (by providing insight to prospects thereby provoking reflection) and other sellers that are deployed to manage existing demand.
People are People
We've heard many times that people buy with emotion and justify with logic. According to modern behavioral economists and psychologists, our decision-making abilities are clouded by illogic, bias, sub-conscious thoughts and unpredictability. Add the social side and need for relationships in many forms and we have a maelstrom of emotions that are difficult to make sense of. Despite taking a dispassionate approach in business, we cannot help but be drawn to certain people, attracted by certain personalities, perhaps clouding our judgment.
In his book "The Brain", David Eagleman says "Our inbuilt neural machinery drives us toward bonding with others. It urges us to form groups. This idea sheds light on the social world that surrounds us: everywhere, humans constantly form groups. We bind together through links of family, friendship, work, style, sports teams, religion, culture, skin pigment, language, hobbies, and political affiliation. It gives us comfort to belong to a group–and that fact gives us a critical hint about our species' history." Once more we return to the idea that humans are driven together accounting for the supremacy of our species.
The point here is that you cannot resist all these years of evolution. Despite all the professional purchasers, the corporate rules around impartiality, the scandals of corruption, the knowledge that what Carnegie meant was "How to Use Friends to Influence People," and the more recent behavioral changes driven by technology. You can't deny human nature. Belonging, esteem, and self-actualization (thanks Mazlov) depend on relationships. It's how we are all wired and to deny it is to deny we're human.
So what does this mean for buying and selling relationships in B2B? If we try to control and over manage this process aren't, we doomed to failure, obviously fraudsters? Our meddling in the natural world continually proves difficult, promoting unintended consequences. False attempts to build relationships are obvious. All the sales training and coaching has moved the needle infinitesimally compared to the amount of time and money invested. Why not just be yourself and let the natural course unfold in front of you?
Peggy Noonan’s commentary on the recent college admissions scandal is to the point. She reminds us that networking shouldn't be the reason to attend college; it should be about getting an education. Same in business - be professional but be yourself. Share your vision and value with the prospect. If they see it, they see it. If not, move on.
What's Changed – Trust and Technology
Society has changed, and technology has changed, and technology has changed society. But despite all these changes its unclear how much impact these have on fundamental human behavior. After all, we're talking about changes over a couple of decades having a permanent impact on human behavior that's been evolving over a couple of hundred thousand years.
Trust is a huge factor in business relationships. It seems that forces have combined over the past few years to seriously undermine our willingness to at least assume people are trustworthy until they prove otherwise – why is this?
The old structures and institutions in which we congregated created an environment that allowed us to get to know one another. Their rituals gave us insight as to how similar people were to us, and how disciplined they were in following those rituals. Think of churches, workplaces, communities in general. The very notion of the community is changing, meaning we have no point of reference and have begun to reverse our view. In other words, now we are immediately distrusting, expecting people to prove their trustworthiness.
Today bad news travels faster. In this era of hyper-connectivity there is a constant deluge of news, usually bad, as we know the media mantra of "if it bleeds, it leads." Many of those stories are about the betrayal of trust in people and organizations, which reinforces this view that people are to be treated with suspicion until they prove otherwise.
Institutions and professions that were formerly held in high regard have been found wanting of late. Whether these are the institutions of government (think financial crisis), sizable private business (think financial crisis) and individuals (examples from just the last week or so include college admission scandals, Mayor of Baltimore and the Mueller Report). One can argue that this is the result of more light by the media illuminating wrongdoing. In other words, this type of untrustworthiness is no more pervasive than it used to be but an expanding media exposes us to more of it now – constantly. This means we've always been untrustworthy, now it’s obvious.
Trust is a fundamental and profound subject, and I'll quote psychologist Dan Ariely who says that "Strict professionalism has been replaced by flexibility, individual judgment, the laws of commerce, and the urge for wealth and with it disappeared the bedrock of ethics and values on which the professions were built." Trust now plays second fiddle to political and financial expediency.
The latest generation in sales and marketing have a different relationship with the truth than I did, while they maintain that honesty, integrity, and authenticity are of the utmost importance. A while back at a networking event, we discussed some of the misleading modern sales and marketing tactics such as the telephone calls that originate from somewhere distant while showing up as a local number on your phone display (the thought being that we are more likely to answer a call originating locally). Our Millennial and Gen Z audience were OK with this, despite it being dishonest and inauthentic. Apparently, it's not dishonest or inauthentic enough. Call us old fashioned if you want, but starting a relationship with a lie never seemed like a great idea.
Technological and generational evolution might have changed the way we build and manage relationships forever, or they might be just blips in the regular cycles of human behavior unable to permanently affect our fundamental human needs and wants. Time will tell.
Books are written on the subject, so we'll only scratch the surface here, but with the advent of the web, mobile, and social media younger digital natives grow up with an entirely different view of relationships. It should not be surprising that as they become the dominant generation in the workforce that the relationship dynamics might change.
The modern business relationship has fascinating contradictions. Younger professionals take the basic lessons of relationship building (like the idea of establishing rapport) but then implement them clumsily. They don't understand that translating this into a dispersed, digital model requires thinking differently.
Trying to conduct any relationship of varying statuses (suspect, prospect, qualified, customer) in a remote model is accompanied by its own set of challenges. Companies continue to move to more inside sales roles simultaneously promoting the primacy of customer and prospect experiences. They benefit from short-term financial savings as inside teams are cheaper but can sacrifice longer-term gains from establishing the trust required for enduring relationships. The latter requires the high touch approach of a field sales group.
Digital natives are more technologically savvy than their predecessors. They don't need the "hand-holding" part of B2B relationships, relying less on the vendor for support and guidance. Modern companies approach to this was to create the “Customer Success” (great title) role. But most then overload these reps, causing them to show up late to calls, jumping off calls prematurely and always reminding you how busy they are with other customers. That's just what we all want to hear.
The Verto Verdict
The more it changes, the more it stays the same. An enduring quote perhaps, but does it reflect the landscape of business relationships? Facing this dilemma we return to two of our founding principles in that we encourage you to be balanced and thoughtful in your approach. Both are values as old as America itself. Here's our verdict…
The Sirius Demand Model reminds us that we should consider and be deliberate about the type of relationships our buyers want. That doesn't mean we have to become inauthentic, overly contrived and downright dishonest. We can be deliberate AND honest. Look at your target market through this lens to help assess how your prospect will behave and what type of relationship/s they'll prefer. We rarely hear these discussions in our clients. We do still hear the old distinctions between hunters and farmers – this is yesterday's news. We need to adopt more modern thinking. Not all salespeople are willing, or able, to challenge a prospect's view of the world or to use unconventional thinking. Most are comfortable trawling the waters and running with active demand. Only looking for active demand doesn't make them bad people, but it makes you a lousy leader if you don't recognize it and manage accordingly. You probably need both types so recruit some challengers and some "project" sellers and split your team.
Find the balance – You don't have to over plan relationships, neither do you just let them unfold at random. Often, we try too hard to reduce it all to "science" believing we can orchestrate and plan everything. The more we do this, the more unnatural acts we commit and the more uncomfortable everyone becomes. As we mentioned earlier, sometimes people just like one another, and some people are just more likable. Trying to fake that is a dangerous game, and while it is difficult to make people like you more, at least you can work on becoming less disagreeable. This is not easy and again requires balance. For example, if you're sales or marketing professional that needs to challenge conventional thinking and to confront and upset the status quo, you'll need to be comfortable making other people uncomfortable…at least a bit. As we have said, great businesses are built on leadership that embraces this type of thoughtfulness.
Beware the Great Deception – I heard some young entrepreneurs singing the praises of Dale Carnegie's "How To Win Friends and Influence People." The popular name for the book was "How to USE Friends TO Influence People" and therein lies the problem. Legitimate interpretations of Carnegie's "classic" point to its deceptive teachings. As Thorin Klosowski says in his Lifehacker book review; “On the flip-side, How to Win Friends is also packed with all kinds of subtle manipulation techniques…” Our advice is to focus on building relationships as a vehicle for communicating value and sharing a vision. If you try too hard to contrive a natural dynamic (friendship), it immediately becomes over-familiar appearing unnatural and bogus. All this does is raise suspicion.
Conventional thinking drives conventional results. Consider playing a different game. Instead of jumping on the bandwagon of moving sales to the inside maybe you need to be the contrarian. If you think relationships are significant to your buyer, then put your money where your mouth is and invest in them. Have a field sales group that's comfortable going face to face. That's a different model to where most of today's conventional business thinking will take you. People say relationships are important to them, but then refuse to invest in a field model that delivers customer intimacy. Failure to invest is a great example of the epidemic of hypocrisy in modern business, talking about the primacy of the customer experience on the one hand, while providing the cheapest mechanism possible on the other. Go with a field sales model that provides greater accessibility for your client and prospect. Train and manage your team to be more thoughtful, more expert and more challenging. This approach might be unconventional, but walking the walk of authenticity (and taking a few risks) is what separates those who make things happen from those who watch things happen.