Sales trend 1 from the Barrett 12 Sales Trends for 2019 tackles the issue of selling when trust in businesses and institutions is low.
While there has never been a better time to be alive with access to wonderful resources and opportunities, amazing innovations, advances in technology and better healthcare, that can encourage the potential for our evolution and mutual prosperity, there is a shadow of mistrust that is following us everywhere.
We have more choices than ever before, and yet, we are more wary, cynical and cautious. We are flooded with oceans of information that are polluted with fake news and so we don’t even trust ourselves to make informed decisions, let alone believe what brands and corporations are telling us. We are caught in a bind because while we need to keep moving forward, we do not know what to believe anymore which means we are questioning and second guessing everything and everyone. And it’s exhausting.
This sales trend is focused on ‘Selling in times of social mistrust’. It aims to highlight those factors and tendencies that brought us to this place of mistrust as well as looking at other emerging trends that offer a more positive, confident and trustworthy pathway forward and how we continue to sell effectively.
So what got us to this place of mistrust in the first place?
Despite all the positives, there are a number of factors, fads and ideologies that have been playing out in business and governments over the last 25-30 years that have contributed to creating this state of mistrust including:
- Profit-only business strategies focused on profit maximisation
- Win-at-all-costs hyper aggressive ‘Bro’ cultures
- Cost cutting as the ONLY way to manage business
- Race-to-the-bottom business strategies
- Privatisation of public assets
- Outsourcing and off-shoring of jobs
- Reductionist approach to the supply chain and procurement
- Unregulated markets
- The cult of growth including narrow cast definitions of success i.e. Bigger/More Is Always Better
- The obsession with GDP (gross domestic product) as the ONLY measure of growth
- Cult of the Celebrity CEO
- Celebrity culture – everyone wants to be famous
- The rise of the Individual
- Cheap credit
- The Gig economy
- Big Data
There are others we could add to the list but you probably get the picture.
This does not imply that all businesses, organisations and communities have gone down these paths; however, many have including larger corporations and bigger businesses, and some governments who, by and large, prioritised growth maximisation without stopping to think about the costs and impacts associated with such an approach.
Some of these costs and impacts include:
- Poor governance – free for all in some cases to leading bribery, corruption and criminal activity
- Prioritising shareholder return at the expense of customer fairness and care
- Hyper individualism and the culture of entitlement
- Increase in selfishness and self-obsession
- Inward facing and separation of community and obligations
- Corporate and business tax avoidance
- Exponential rise in CEO and senior management salaries and bonuses compared to salaried workers
- Slow or no wages growth for most
- Rise in inequality
- Unfair or heavily biased contracts
- Anti-competitive, predatory business practices and excessive market share in the hands of too few global corporations
- Unfettered exploitation of resources, people and the environment
- Austerity interventions
- The rise of populism in politics
It’s been a slow burn but it all seems to have conflated in recent times to create this overwhelming feeling that not everything is right, just or fair.
Human beings are, by nature, wired for fairness and so when that social contract is threatened and enough people can evidence the impact on them and others, they react by taking action to redress this.
Which is why we are now seeing interventions like the Australian Banking Royal Commission taking the banks and other financial institutions to task over their unfair, unethical and, in some cases, criminal activities and behaviour towards customers. However, this only came about because people, not corporations, agitated and demanded that their politicians stand up for them and hold the banks and financial institutions to account. The agitation started many years ago but only got traction when the scale of the issue became so large that politicians could not ignore it any longer.
Trust is the heartbeat of all relationships
Trust is the heartbeat of all relationships whether it be business, sales, friendship or society.
Without the life force of trust pumping vitality through our collective systems every day we start to wither and recoil. We become weak and anaemic. We close ourselves off and lose sight of what is real and important to our survival. Hence the current shadow of mistrust we find ourselves in.
Those organisations that value trust and trusted relationships do things to ensure that their customers, patrons, members, constituents, suppliers, employees and broader communities are central to their licence to keep on operating and ongoing mutual prosperity.
They understand that trust can be broken at any time and is a fragile system. It needs constant attention and vigilance. It must be leader led and reinforced and supported on a daily basis.
The following trends are now gaining real momentum and will have a dramatic impact on business, sales and customer relationships.
Where to from here?
It is in the last 10 years or so that the concept of Customer Centricity began to emerge. While it is now a common phrase splashed liberally across many company websites and brochures, the true nature, spirit and practice of Customer Centricity is not so common and still viewed as an intellectual concept or platitude by many. However, there are more organisations beginning to embrace these principles, values, behaviours and codes of conduct.
Those businesses who do truly embrace a genuine Customer Centric ethos across their entire value chain in everything they do will rebuild and/or develop trust much more easily with their clients, suppliers and employees than those who just pay lip service to this concept.
Until there is a bigger shift away from the prevailing business fads and trends of the last 25-30 years towards more ethical, human centred sustainable and commercially viable business models and practices that can also deliver viable growth now and over the long term, it won’t be fully embraced.
Yet, endeavours like the Banking Royal Commission could see this shift happen sooner than later because customers are finding their collective voices and the rise of the consumer activist is forcing organisations to change and adapt.
Activist Consumers, Shareholders & Constituents
More and more people are becoming better educated and more informed about the impact of the supply chain, business and consumerism on society and the environment. They are demanding that organisations and governments act and behave in more ethical, fair and sustainable ways now and for the future. The increasing urgency for action on climate change is ramping up. Just look at the Australian school children protesting in November 2018 about inaction on climate change by the Federal Government and the message it sends to the rest of us.
Whether the politicians listen or not, their futures will be affected by how we vote. If various politicians are not putting out clear policies and agendas that the majority of people want they will be voted out in favour of those that truly listen and show they care and can take decisive action.
Younger people and more informed older people are voting with their wallets and ballot cards and choosing to buy or vote from those organisation who transparently demonstrate their bona fide environmental and social intentions and credentials to doing good business: from across their supply chain and back again.
For instance, IKEA is now taking back used furniture for recycling and repurposing. Fast fashion looks as though it is on the way out because people are realising it is damaging the environment and instead are looking to hold on to or repurpose their clothes. Repair cafes are popping up all over cities where people can take their broken appliances to be repaired by volunteers who lend their expertise to keep things working so they don’t get thrown into landfill.
Social Licence to Operate (SLO), Legislation, Whistleblowers and the role of Boards and Management
Another emerging trend is the rise of the concept of ‘social licence to operate’ (SLO).
While SLOs have been around for more than 20 years, starting in the mining in and minerals sector when organisations were negotiating with communities seeking approval to set up operations or broad social acceptance, SLOs are now gaining more traction as consumer bodies, businesses, organisations and industry bodies try to find ways to navigate the social, commercial and legal contracts between consumers and organisations.
For instance, the Australian Stock Exchange Corporate (ASX) Governance Council proposed to include a “social licence to operate” in its Corporate Governance Principles and Recommendations which included significant amendments to Principle 3 changing it from:
“[a] listed entity should act ethically and responsibly” to “[a] listed entity should instil and continually reinforce a culture across the organisation of acting lawfully, ethically and in a socially responsible manner”.
The proposed new commentary for Principle 3 says that a listed entity’s social licence to operate “is one of its most valuable assets and that it can be lost or seriously damaged if the entity or its officers or employees are perceived to have acted unlawfully, unethically or in a socially irresponsible manner”. And that, “with appropriate training and reinforcement from senior management, a listed entity’s code of conduct can help to instil a culture of acting lawfully, ethically and in a socially responsible manner”.
A new recommended 3.3 proposes a whistleblower policy that “encourages employees to come forward with concerns that the entity is not acting lawfully, ethically or in a socially responsible manner and provides suitable protections if they do”.
Interestingly, shareholder groups, big super funds and the Australian Council of Superannuation Investors made submissions supporting the proposal, while former heads of the Australian Stock Exchange (ASX), an investment banker, the new chair of AMP and the Australian Institute of Company Directors publicly opposed or expressed concerns about it.
Along with this, ASIC Commissioner John Price said directors “would do well” to carefully consider a 2016 legal opinion by Noel Hutley SC and Sebastien Hartford-Davis that they could face lawsuits for failing to consider risks related to climate change. Mr Price said the advice, which was commissioned by the Centre for Policy Development (CPD) and the Future Business Council, “appears legally sound and is reflective of our understanding of the position under the prevailing case law in Australia in so far as directors’ duties are concerned”.
Company directors and senior management are either willingly or being forced to consider the consequences and impact of their decisions and actions now and into the future.
How they act will have positive or negative implications for everyone concerned.
It makes (Business) sense
Operating ethical businesses and being good for the planet and its inhabitants benefits the bottom line. There has plenty of research to support that. The best example is outdoor clothing and gear company Patagonia, but there many, many more. Business models like Share Value and Benefit Corporations accompany businesses that are leading the way.
Earlier this year, the CEO of asset manager Black Rock sent a letter to the biggest companies in the world warning their CEOs on the need to demonstrate long-term value creation and the impact their operations have in the world, and how they make a positive contribution to society.
Almost at the same time that letter went out, Danone –a French multinational food corporation- announced it had “partnered with 12 leading global banks to lower their loan rates if Danone increases its verified positive impact in the world.” Giving Danone a big advantage in accessing cheaper capital for improving their already positive environmental goals.
The new transparency and accountability are here.
There is nowhere to hide or no one else to blame.
By exposing everything to sunlight, bringing it out into the open, making people and organisations accountable, makes it easier for us to make decisions about who to trust and how we move forward.
What does this mean for sales and salespeople?
What this trend shows is that people are wanting to trust others; they need to trust and have confidence in others and in organisations and institutions in order to flourish and evolve.
Salespeople are at the front line where the seeds of trusted relationships begin; however, if we are to address the climate of mistrust we must encourage ethical, human centred sales practices and engage everyone across our organisations to be part of the chain of trust and service.
Trust, confidence and mutual prosperity can only flourish when:
- No one is taken for granted in the dynamic world of today
- Genuine engagement is encouraged and supported
- People are listened to and understood
- Appropriate action is taken to promptly address issues
- Diversity is celebrated and encouraged
- We understand that great ideas and innovations for our future usually happen at the fringes and are often brought to us by ‘outsiders’ who we may disregard initially
- Respect, kindness and collaboration are central values practised daily
- The right actions are taken for the right reasons and are inclusive of the greater good
- It is not just about Policy or Strategy but also confidence in managing the Big Picture for the betterment of all
- We recognise we are all in this together and that helping others get ahead, helps us too. We are all better off working together
- We recognise we are part of a large system of variable and nothing is perfect
- We recognise that human beings are naturally wired for fairness, curiosity and helpfulness, and not greed
Remember everybody lives by selling something.