Do your strategic customers trust you?

INTRODUCTION

Establishing and maintaining trust is the glue that holds together any relationship. It is critical for key account management but is often not discussed.

It should be.

Whilst it is easy to get lost and absorbed by strategic frameworks, spreadsheets that analyse results and new product launch planning, one factor should always be remembered:

People buy from people, and buyers will deal with suppliers when they have people they trust from organisations that want to be trusted.

This newsletter explores trust and suggests a few models that key account managers can use to incorporate science into trust. It then applies a few tips to help them make it a valuable skill.

It asks the question:

What is trust, anyway?

Defining trust is an interesting start, especially in a business context.

When customers choose to work with suppliers, they are essentially "trusting" them to carry out tasks and activities that they have chosen not to do themselves. Reasons for this choice vary, but typically, it is because the supplier has capabilities that focus on these areas to add value by doing the tasks better, cheaper, quicker, to a higher standard or a combination of all of these things.

Regardless of the reason, the customer must trust that supply is established and maintained as expected. Service-level agreements, contracts, and pricing agreements are put in place to formalise these transactions, but trust is the human element that seals the deal.

Feltman provides a couple of quotes that describe business trust perfectly:

Defining Trust:

“The decision to rely on another party under conditions of risk“

“The intention to accept vulnerability based on a positive expectation of the intentions or behaviours of another”

Feltman: The Thin Book of Trust

When trust is fractured

Like any relationship, broken trust has damaging consequences.

In a personal relationship, breaking trust can sever a business partnership or end a marriage.

In a strategic business partnership, loss of trust can lead to several factors:

Decision-making on new proposals can be severely slowed down
Business can be lost to competitors
Business that was once secure can suddenly be put out to competitive tender
Access to strategic information becomes restricted
Supplier positioning can shift from (the inner circle to the outer circle)

In short, fractured trust can significantly hinder customer business and damage performance.

Of course, trust works both ways. If a customer behaves in a way that strains relationships with key suppliers, why should they continue to receive premium service levels or access to new products and services?

Just like any relationship, trust works both ways.

A quick and dirty way to measure trust

Since trust is a human-to-human function, it can be tricky to measure. Fortunately, work has been conducted in this area, and attempts have been made to make it more tangible.

In "The Trusted Advisor", Maister et al propose the Trust Equation - shown in Figure ( 1 ). When considering a key customer, from their perspective, they expect the factors on top of the equation to be higher. They seek:

Higher credibility - are you capable and skilled?
Higher reliability - do you deliver what you promise?
Higher intimacy - do you work hard to understand the important parts of their business?

At the bottom of the equation is self-orientation. Customers here seek:

Lower self-orientation.

Essentially, trust will diminish if your relationship is all about you (or at least your company) and the sales/results you get. This makes sense and is typical of organisations with a sales focus and short-term monthly or quarterly targets.

The perspective above is for the customer looking at the supplier. The equation also works the other way. If customers have zero interest in suppliers (usually, the red flag here is that they just demand lower prices), then trust will be strained equally.

Trust is the bedfellow of a relationship, and they both work in 2 directions.

Of course, B2B is a bit more complicated

Trust has a more interesting dynamic in B2B relationships, which adds some complexity. Relationships are hard enough when one person is dealing with another person.

But B2B involves multiple stakeholders. Of course, the Key Account Manager deals with a main stakeholder (usually the buyer), but many other relationships and connections also exist, often with more importance.

The key account manager sits at the centre of these relationships and must maintain trust across the customer business, their organisation, and other stakeholders.

Key account managers hold a lot of things together!

When dealing with the customer, the Decision-Making Unit (DMU) is often adopted to analyze relationships. This includes the buyer, decider, specifier, gatekeepers, users, and influencers. It is not always easy to understand which people in the customer organisation do which role (and some people have multiple hats!), but making this analysis is critical.

If trust is fractured within the DMU, progressing with any purchase agreement or deal will be very difficult.

Figure (2) shows the 4 main relationships that Key Account Managers must maintain trust with. They are:

Trust building with the customer DMU
Trust building with the internal (supplier organisation) functions
Trust building with the internal (supplier organisation) senior leadership team
Trust building with critical suppliers

Think about it.

A key account can represent 20% or more of a company's revenue/profit. The leadership team, investors, and other stakeholders rely on and trust the key account manager to maintain business with this strategic asset.

Do you think it's easy being a Key Account Manager?

Think again!

How to build trust like a ninja...

There are a few things to consider when looking to build trust.

Firstly, the Key Account Manager must have a strong relationship with critical stakeholders (internal and external)

Secondly, the wider organisation must do its job to deliver promises. I often hear from a Key Account Manager that they are trusted by a customer and have a strong relationship. But hey, my organisation fails to:

supply goods on time
supply the correct quality
we have horrendous systems that make admin difficult

These are typical issues. Frankly, if your organisation fails to deliver, then that is a bigger problem. Key account managers have a role in being the customer's voice and giving feedback on these issues.

The advice given here is for personal trust building. You should appreciate that some matters need wider teams and functions in your organisation to adapt.

In his book The Speed of Trust (the one thing that changes everything), Stephen Covey provides a foundation for life and business.

He argues that trust is not merely a social virtue but a hard economic driver. He posits that trust significantly impacts speed and cost in both personal and professional spheres: high trust accelerates processes and reduces expenses, while low trust slows things down and increases costs.

Covey introduces the "waves of trust," illustrating how trust radiates outward from the self to relationships, organisations, markets, and society.

The first wave, "Self-Trust," is the foundation built on credibility. This credibility comprises four cores: integrity, intent, capabilities, and results. Integrity means being honest and congruent. Intent refers to motives and agendas. Capabilities encompass talents and skills. Results represent the track record of accomplishments.

The second wave, "Relationship Trust," focuses on building trust with others. Covey outlines 13 behaviours that foster trust in relationships: talk straight, demonstrate respect, create transparency, correct wrongs, show loyalty, deliver results, get better, confront reality, clarify expectations, practice accountability, listen first, keep commitments,¹ and extend trust. These behaviours, when consistently applied, build strong, trustworthy relationships.

See Figure ( 3 ) - use this as a checklist to build your own skills to become a trust-building ninja.

The third wave, "Organizational Trust," extends these principles to a broader organisational context. Covey emphasises that organisational trust is built on alignment, systems, and symbols. Alignment means ensuring that systems and structures support trust-building behaviours. Systems should be designed to promote transparency and accountability. Symbols, such as leadership actions and communication, must reinforce the desired culture of trust.

The fourth wave, "Market Trust," addresses trust in brands and with customers. Companies that build customer trust enjoy greater loyalty, repeat business, and positive word-of-mouth. This requires delivering on promises, maintaining ethical standards, and fostering transparency.

The fifth wave, "Societal Trust," explores the broader impact of trust on society. Covey argues that high-trust societies are more prosperous and stable. He encourages individuals and organizations to contribute to building trust at a societal level.

A key concept in "The Speed of Trust" is the "trust tax" and the "trust dividend." Low trust imposes a tax, slowing down processes, increasing bureaucracy, and requiring extensive oversight. Conversely, high trust pays dividends, enabling faster decision-making, greater collaboration, and reduced costs.

Covey advocates for a proactive approach to building trust. He emphasizes that trust does not happen passively but rather through deliberate choice. He encourages readers to take responsibility for their trustworthiness and actively build trust with others. Cultivating trust at all levels can unlock significant economic and personal benefits for individuals and organizations.

What next?

Over the last few weeks, I have been applying some of these ideas to build trust. when you have a framework and a different way of looking at something, it is remarkable how your perspective can shift.

Some questions I have asked myself:

Do I trust this organisation? (customer, supplier, retailer etc)
Do I trust the people that I am dealing with?
Do they trust me?
Have I done anything to strain/break trust?
What did the other party do to strain/break trust?
What could I do to restore trust if needed?
Should I incorporate these trust principles into my KAM coaching and training (that's a yes, by the way)

To answer these questions, you have to be brutally honest with yourself!

You also have to consider whether you want to make the effort to repair and build trust. It is so much easier to carry on with a fractured relationship and just hope it goes away or fixes itself (clue—it never does).

After researching and writing this article, I have mainly adopted Covey's 13 (behaviours) tips for trust building—Figure ( 3 ).

It works for me; maybe it will for you.

More if you are interested

If you would like to know more about how to improve your approach to KAM, download my latest article:

Rethinking Key Account Management

The four blocks to ignite KAM as your strategic competitive edge.

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Rethinking Key Account Management - The 4 blocks to ignite KAM as your strategic competitive advantage.