Trust and Commitment
“Commitment and trust, rather than (or at least in addition to) power and dependence, are now central to discussions of business relationships.
Researchers and practitioners have come to view most interactions between business parties as events that occur over the course of a relationship between two or more partners.”
Not my words, but those of Rob Morgan and Shelby Hunt. We’ll come to these guys shortly.
The funny thing about business-to-business (B2B) is that it’s less about business and more about relationships. In fact, B2B is really P2P: person-to-person. People buy from people. In large organisations, the decision to go with one particular service provider over another is often down to the answer to one simple question: “Do I really want to work with this person?”
The answer to that question is usually based on the perception of whether the individual can be trusted or not. Without trust, there can be no commitment.
How Important is Price?
Large business contracts are often put out to tender. Companies will often produce a clear set of evaluation criteria to help guide the choice of service provider. Price is always one of the evaluation metrics. Even so, the final decision is often made on softer and unwritten criteria. Few decisions are made solely on the basis of price. Oftern, they are made on a combination of price and solution/ functionality. But when it comes to making the final choice to award any contract, subtle psychological elements come into play.
“OK, I know these guys seem to have the [INSERT: ‘best product’, ‘lowest price’, ‘most innovative solution’]. But what if it all goes wrong? Will they sort out the issues or will they leave me in the lurch? Will I lose my job?”
Fundamentally, we like to buy from people we think are honest, who treat us fairly and who act with integrity. In other words, we buy from people we trust. Price is generally a secondary consideration. It can’t be ignored but rarely is it the most important factor in the decision-making.
Morgan and Hunt
The Commitment-Trust Theory of Relationship Marketing quickly became a hit, not just in academic circles, but among senior business executives who were trying to identify why people were likely to do business with you.
Essentially, what Morgan and Hunt realised all those years ago is that long-term business relationships are built on a mutual and cooperative working relationship between two partner firms. Focus on Trust and Commitment if you want to foster and nurture such relationships. That’s why we built these key metrics into the heart of our Customer Relationship Quality (CRQ) methodology.
Are you interested in building trust and commitment with your key clients? Would you like to find out more about our Customer Relationship Quality (CRQ) model? If the answer to either queation is yes, please contact us.