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Accountancy and ‘The Speed Of Trust’

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1st Jun 2011
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It was a privilege to attend a half day presentation recently on ‘The Speed Of Trust’ by Stephen M R Covey – the son of the 7 habits Stephen Covey.

If you weren’t at the Institute of Mechanical Engineers in April to witness Stephen’s keynote, here’s a few thoughts relevant to growing an accountancy firm.

Why an obsession...? asks Paul Shrimpling of Remarkable Practice.

Isn’t trust the number one issue for every firm? Including yours?

I think so. Here’s why:

  1. When your CLIENTS trust you – they stay with you and recommend others to join you. If they don’t trust you they leave you for one of your competitors
  2. When your INTRODUCERS trust you – they will stay in touch and also recommend others to you. If they don’t trust you they’ll refer them to your competition
  3. When your PROSPECTIVE NEW CLIENTS trust you – they will eventually leave their current accountant and buy from you. If they don’t trust you they’ll stay put or join another firm
  4. When your TEAM trust you – they’ll wholeheartedly do their job and even go the extra mile when necessary. If they don’t trust you they’ll either undermine what you’re doing or leave

Clearly trust plays a vitally important (if ignored) role in the life of your accountancy practice.

Whoever masters the issue of trust will win out. It will be either you or your competition. So...

...becoming an expert in trust pays off...

To help you and your firm master the concept of trust here’s what I learned from Mr Covey Junior.

Trust is an economic driver

WHEN TRUST GOES UP (improves), speed also improves and costs go down.

TRUST ↑    =    SPEED ↑    COST ↓

EXAMPLE: The New York donut seller sees customers leaving his queue because he can’t serve them fast enough. He realises that giving change on each sale is the cause of the delay in serving (his bottleneck).

So he loads a basket with change, serves his customers and asks them to take their own change. He now serves twice as many customers. Customers also come back more often because they appreciate the trust and because there are no delays. Tips increased too!

WHEN TRUST GOES DOWN (declines), speed also declines and costs go up.

TRUST ↓    =    SPEED ↓    COST ↑

EXAMPLES: After 9/11 trust at airport security goes down. Instead of 30 minutes it takes 90 minutes to get through security, and if time is money then it costs us more. The added security also costs more which is ultimately reflected in the ticket price.

How can Warren Buffett conclude the purchase of a £15bn business from Walmart in just 29 days? He conducted no due-diligence which saved millions and made the deal a quick one compared to the 6-10 months it typically takes to finalise this scale of deal. I’m certain he did his research beforehand, but he asked just two questions.

Warren’s questions in the meeting? 1. Can I trust these figures? 2. Can I trust you?

Trust Works For Accountants

The more a prospective client trusts you, the quicker she will make a decision to leave her current firm and use yours. The quicker the decision to move, the less it will cost you to win each and every new client. The quicker the decision, the faster your fees and profits will grow.

Can you see how powerful and profitable it can be to build your sales and marketing efforts around improving trust with your prospective customers?

EXAMPLE: With this in mind one firm we work with is launching his book in June. He works in a specific niche (dentists) and has captured all he’s learned and turned it into a beautiful, well-written, hard-back book. Will people in his niche trust him more or less because he’s a published author and expert in the sector? The trust he will warrant in his sector will increase and the speed at which he will win (we expect) will increase. Of course we anticipate more dentists being interested in his firm too.

So what do YOU do to establish, build or restore trust?

Apply the four core competences of trust:

The word for trust in some languages is the same as the word for confidence.

Trust or confidence in you increases when you perform better at the four competences of TRUST.

COMPETENCE:

1. Results – take responsibility for results – expect to win – finish strong
2. Capabilities – talents – attitudes – skills – knowledge - style

CHARACTER:

3. Intent – examine your motives – choose abundance – declare your intent
4. Integrity – make and keep commitments to yourself and others – stand for something – be open

If any one of these is missing or lacking then trust goes down. And as you’ve already seen, if trust goes down speed goes down and costs go up.

Improve these four core competences and trust will go up, speed will go down and costs reduce.

The $64million question

How do you know if you or your business has a high trust quotient?

Answer: Look for evidence around the 13 ‘trust’ behaviours. It’s not what you say but what you do (and what you have done) that determines the level of trust you achieve.

Here’s what you do to improve trust:

“You can’t talk your way out of a problem you behaved your way into.”

Your behaviour is the evidence of your trust-worthiness and comes in 13 forms:

  • 5 behaviours are connected directly with character (intent and integrity)
  • 5 behaviours are directly connected with competence (capabilities and results)
  • 3 behaviours are connected with both character and competence

N.B. please bear in mind that any strength in the extreme is a weakness, just as it is a weakness if it doesn’t show up enough.

You can assess your trust quotient on whether you exhibit the behaviour, exhibit the opposite behaviour or exhibit the counterfeit behaviour! Grade your own trust performance on a scale of one to 10 and identify which one or two you need to focus on.

The 13 behaviours of trust

Master the four cores of trust and the 13 behaviours of trust and you’ll become more trustworthy.

Become more trustworthy and you’ll earn the associated economic benefits of a high trust reputation.

Paul Shrimpling is managing director of Remarkable Practice and author of a white paper entitled ‘The 7 big mistakes that accountants make that costs them a fortune in lost sales, lost profits and lost personal cash’. You can purhcase Stephen M R Covey’s book ‘The Speed Of Trust’ from Amazon.

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By jimeth
03rd Jun 2011 11:13

This would make the world a better place

This is an excellent article.  The world would indeed be a better place if more us valued trust and trustworthiness more highly.  This applies to business life as well as to every other area of our lives.

I think most of us have room for improvement in at least one of the 13 behaviours - I know I have in several of them.  And I can see in these 13 behaviours the reasons why there are certain people whom I really trust.  You do not have to agree with people all (or even most of) the time to trust them - they just need to behave well in these ways.

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By Paul Shrimpling
03rd Jun 2011 14:29

more on trust

Glad you found the article of use.

I highly recommend the book 'Speed Of Tust'. I also recommend the current volume I'm reading on said subject - it is also turning into a valuable insight - 'Trust-Based Selling' by Charles Green (of 'Trusted Advisor@ fame).

Paul

www.remarkablepractice.com ... inspires remarkable results in accountancy firms...

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