In the drive to define business management as science and systematize sales and customer interactions, firms have lost focus on a key principle of good sales and customer management: People buy from people.
Organisations do not typically buy from organisations.
Of course there are situations where organizations buy from organizations. Where the brand name is so strong, that purchases are made without strong personal contact. Though the list of big name collapses in recent years should make us wary of trusting names: Kodak, Westinghouse, Schleker, Nortel, Lehman Brothers and more. The 2008 financial crisis in particular, taught us that blindly trusting brand names, especially in banking (that historically most conservative and “relationship” oriented business), is not necessarily wise.
Coincidentally, my Smarter Selling co-author, Keith Dugdale, and I were in New York at the time of the crisis and were sitting in the offices of Bank of America on 14 September, the day they bought Merrill Lynch for a knock-down price.
The events of 2008 also taught many companies a harsh lesson in valuing the strength of relationships. As one banker commented to us:
“We thought we had strong client relationships, but when times got hard we had some nasty shocks.
Clients who had been with us for many years simply walked away.”
Post 2008, the world has focused on technology advances to drive growth, and deliver accountability. Interestingly though, while our consumer lives are increasingly free of human touch, our work lives increasingly rely on our ability to influence others across different departments, and often between organizations and across time-zones to collaborate, innovate and get things done.
To get things done, people must work with other people – and in an environment where trust in corporates (and many public figures) has been undermined, a re‐examination of the strength and value of an organization’s relationships with itself and with the outside world, is critical to valuing the overall strength of a business and its future prospects.
Taking this a step further, attributing value to the cumulative and inter‐ connected relationships of all the people in an organization; both internally (with colleagues) and externally (with customers, clients, suppliers and broader contacts) reflects an organization’s relationship capital.