Building strong B2B relationships and building trust, in our view, are synonymous with each other these days. Perhaps in the “good old days” we readily trusted people and organizations but today is a different story.
You can blame false advertising, “fake news”, politicians broken promises, social media, slimy sales people or your own first hand experiences not mentioned in this growing list!
But, trust isn’t a given anymore.
What is Trust in Business?
Trust in business happens at the individual and organizational level. For example, let’s start with the sales rep that you rely on and who always comes through for you. She’s accessible, responsive and delivers value, even though you can’t stand the company she works. You trust her and stick with her.
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Your loyalty is to her and not the company. So, the question for the company owners is what happens if she leaves to work for a competitor?
While it’s true that client flight risk varies from industry to industry, there are mechanisms companies use to retain them. These include switching costs; regulatory compliance; purchase agreements and contract lock ins. And, these are examples of retention mechanisms that Warren Buffet refers to as an economic moat.
But, what happens if these negative mechanisms aren’t in place? Are there positive ones you can create that will help you establish an economic moat?
The answer is yes and they hinge around value exchange and trust. Value exchange and trust are examples of positive mechanisms that increase your chances of retaining your customers and getting new ones. Consider baking these in to your economic moat.
Building Trust in Business Framework. The Ingredients to Making it Happen
There are many business oriented definitions of trust but let’s keep it simple and see what the Oxford dictionary says:
“Trust is the firm belief in the reliability, truth, ability, or strength of someone or something.“ Oxford Dictionary
How do you put this definition into action? Use this framework, adapted from Stephen Covey’s Speed of Trust book, to build trust as an entrepreneur, business professional and organizationally.
You can’t go wrong focusing on building your character and competence! Let’s break this framework down.
Character Explained
Character is defined as the mental and moral qualities distinctive to an individual. I like how this trust framework breaks character into two areas: intent and integrity.
Today, showing you care, being open and transparent reflects well on individuals and brands…if done genuinely. Can an organization show its character? It can through its leadership, how it treats its stakeholders and is thought of in the public domain.
The best business professionals and ventures have character.
Competence Explained
Competence is the ability to do something successfully or efficiently. But, when it comes to professional or organizational competence we need to dig deeper! The Building Trust Framework breaks competency into two areas: capabilities and results.
Capabilities
Capabilities is the combination of observable and measurable knowledge, skills, abilities and personal attributes. These contribute to enhanced employee/professional performance and ultimately results in organizational success.
There are three levels you can use when it comes to assessing capabilities and they are: Knowledge, Experience and Expertise. Here’s how they’re defined:
Knowledge emphasizes theory and the obtainment of information and ideas
Experience, on the other hand, stresses practice, or the application of knowledge over a prolonged period of time, in order to reinforce understanding of subject matter or a certain task. Experience means you’ve done something a lot.
Expertise is even better! It means you’ve done it a lot and you do it well. We achieve expertise by doing something a lot, paying attention, and caring.
Results
If you can’t back your capabilities with results it’s more difficult to be trusted; especially right away.
At first glance you may see reputation, credibility and performance as synonymous with each other. To some degree you’d be correct. But they are distinct.
Reputation: this is more about what people know about you, or your organization. And, what comes up when people do a Google search about you or your organization. For larger companies and influencers the media factors into this as well. I’m referring to traditional (broadcast, print/online) and social media (pick a platform). Plus, word of mouth/mouse, search and your online presence help build your reputation.
Credibility: things like degrees, certifications, testimonials, references, blog posts, interviews help demonstrate your credibility. For professionals your credibility is enhanced via your professional network of quality contacts. For organizations it’s who your customers are and how well you’re regarded in your profession and the industries you serve.
Performance: there are two key things we deliver when it comes to value to customers: outputs and outcomes. Customers will pay for one or the other but ideally would like to see both. This is where performance comes in.
Summary
I wrote this post to help me and my venture, Mi6, educate and inform you on how we build, earn and bank trust. The core foundation of trust revolves around character and competence.
Whether you’re a business professional, trades person, entrepreneur or a CEO of a multinational you can use it for yourself and your organization. I hope this post has helped answer your question: What is trust in business?
This blog post written using the Mi6 Marketing Integration Framework as my guide.
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About the Author
Chris Herbert spearheads Mi6 Agency, emphasizing small business growth and entrepreneurship. On the agency's blog, he offers practical marketing insights and solutions to unique challenges faced by businesses. Herbert advocates for sustainable and responsible growth. His "Rural Entrepreneur Podcast" extends this mission, providing essential advice and experiences for entrepreneurs. He adopts a comprehensive approach, focusing on building sustainable businesses, community engagement, and active participation in entrepreneurial ventures.
