trust - the secret ingredient

Trust is fundamental to any relationship, and no less so than in business (and I don't mean the Winston Peters kind). The most efficient business relationships, in fact are built on trust: those with a true partnering spirit are symbiotic, so the interests of each party are shared with the other. This means simpler commercial arrangements, faster transactions, and no disputes. Those less trusting, however, require more onerous setup, closer management, and have greater chance of issues around payment. Establishing trust in a new relationship is the secret of business development. Here's a neat formula for trust: trust = (rapport X credibility)/risk.  Trust is gained first by personal rapport - an emotional reaction to individuals and brands. This sense is then multiplied by a rational assessment of credibility (evidence of capability and experience) before the sum total is weighed against risk (of it not working out, of the other party not being what they seem).  Business proposals need to understand and reflect how trust is calculated - both in the way they are presented as well as the content they contain.

Comments

[Sean Bohan]

Love the equation but wonder where the opinionsphere affects it. Rapport? YES. Credibility? YES. What % of the Credibility variable Reputation?

Great post - thanks

[Tony]

Thanks for commenting Sean! I expect the influence of reputation on credibility (and risk) may be increasing as buyers have greater and easier access to the opinionshpere. This is a great benefit of the new transparency we operate in now - its harder for people to oversell themselves. Great point.