"It makes me ill, how callously people talk about ripping clients off," said Greg Smith in his New York Times op-ed: Why I'm Leaving Goldman Sachs, March 14. On his way out after a dozen years at the firm, Smith described the environment as "toxic and destructive."
The article has been making the rounds online, with and without commentary. Trust is at issue, in the sense of the term described on Wikipedia -- a relationship of reliance. As a customer (or client), our main concern is whether we can rely on someone to do what we think they're going to do.
Because we're all so busy (read pay attention to meaningless things) and new information is coming at us fast and furious daily, we have been taught to rely on shortcuts, which are false proxies -- size, affiliations, predictability, etc. -- as a substitute for due diligence.
This is the famous misquoted quote: "nobody ever got fired for buying IBM," or hiring that [insert big brand name] firm. We're trained to make Pavlonian choices. Unless, unless we look more closely at the trust virtue:
- How many people reviewed them positively?
- Who among my circle of friends would recommend them?
- Were the transactions with people I know (or know of) in the past satisfactory?
We do it because it is easier to have trust than it is to have confidence.
The bigger questions, which we may or may not be aware of, because confidence takes work:
- Have they kept their promises in the past?
- Did they deliver when they said they would?
- Did they keep their promises every time?
Trust can be the easy choice. But there is a downside. It takes trust to trust. Has anyone done the work to have confidence or is everyone just assuming someone checked the facts? An economy built on or relying on trust alone is like a house of cards.
Even sadder, is that companies and their advisers seem more preoccupied with being trusted than having confidence in their promises.
At Brand Strategy Insider, J. Walker Smith, Executive Chairman, The Futures Company, sets apart mistrust in institutions, which he defines as rooted in misgivings about the role and position that institutions should play in people’s lives, even when such institutions are operating honestly and efficiently and transactional distrust, which is a reaction.
We diverge a little in how businesses get there.
Whilst distrust exists, the solution is not to fall for the same mistake again and focus on building trust. The idea that the solution is the opposite of the problem is a common misconception. The solution lies in creating the conditions upon which clients/customers can buy and keep buying in confidence.
Confidence comes from making the best possible promises, delivering on them, exchanging value in return and then making better promises. Promises made in confidence and not hope is what leads to strong, resilient, and enduring organizations.
Brands benefit more from confidence than trust. One way to measure the value of a brand is to measure the gap between what was promised and what was delivered. This is the brand delta. The smaller the gap, the larger the premium. But as the gap grows, the brand's value diminishes until goods and services need to be discounted.
See how there is no sentimental judgement here -- you deliver on your promises, you make better ones, you grow your business.
Tactically speaking, this is the customer or guest services person who sits down with you at a local branch of a bank and patiently navigates their own bureaucracy to get you the information you need, thus giving you confidence you have what you need. Deliver on a promise.
It's the list of top contacts the business development or marketing manager is calling on this week to start talking about your product. They return her call because she previously delivered on her promises without breaking them. When that continues, she can make better promises.
The one is available in response to you walking in with questions, the second makes their network available to respond based upon an existing relationship of confidence and credibility. Why and how don't change -- what does.
Confidence is the premium or discount to the trade.
Are clients confident they can rely on Goldman Sachs to deliver on its promises after Greg Smith's revelation? Were they before? Did the op-ed contribute to an open admission of deliberately breaking promises, thus increasing the risk for the next promisor or were clients already aware of the gap between promise made and promise delivered?
The lesson here is: Forget trust, take control of your brand by delivering on your business promises by doing what you say you do. Client/customers do decide whether you delivered on your promise or not.
How does a business create trust? Through false proxies –- size, affiliation, spin, predictability. The trust virtue is snake oil. Trust evaporates on sentiment.
How does a business build confidence? Make good promises, know how you’ll keep them and keep them every time. Confidence evaporates when you break a promise.
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