“Contracts just make the lawyers rich,” she said. “We don’t really need one.” He didn’t know any better, because this was literally the first deal he had ever struck. Her authoritative position on the subject made him believe that contracts were simply not necessary, and that a person’s word was the same as law.
Not long after the deal was made, she changed the terms. Not because they had agreed to do so, or that he approved any changes – she just changed them. She said the deal went one way. He thought it went another. It didn’t take long for the transaction to collapse and the parties to start talking to lawyers.
By the time I became involved, I had already heard stories of her dishonesty in other business deals. These stories came from people I knew and trusted. I wanted to give her the benefit of the doubt, this time, but already knew how it all happened and why. My job now would be to resolve the situation and then focus on educating my client for future protection. A task that was far more complicated.
Trust is a slippery issue: it’s hard to regain after you lose it. When there’s no trust, there’s no credibility. When there’s no credibility, deals disappear. Here are five easy ways to destroy your credibility in business, so avoid each one like the plague.
1. Make Promises You Don’t Intend to Keep
Contracts memorialize terms, and they can be used as reference points when a dispute arises. However, no contract in the history of contracts can preserve your credibility if you make promises you do not intend to keep. A credible reputation in business begins and ends with honesty. If you promise to do something, do it – even if the contract is silent on the subject. In my years as an attorney and consultant, I’ve seen hundreds of situations when a person promised something that wasn’t in the contract. Eventually, the promise became the relevant subject, and the person who made it said something like, “well, it’s not in the contract, so I don’t have to do that.” When you make a promise you don’t intend to keep, you destroy your credibility.
2. Take Advantage of People with Less Experience
I remember watching an old war movie where the soldiers lined up waited to engage in a “fair” battle with the other side. I also remember thinking, “why not ambush them – war isn’t fair?” It’s true, war isn’t fair and perhaps shouldn’t be. Business, however, isn’t war, despite what you’ve heard. In business, when you take advantage of a person with less experience, you demonstrate a frightening character trait. Sure, you may win the deal or negotiation, but you will lose credibility with your colleagues and competitors. It’s kind of like taking candy from a baby – it’s easy, but it’s pathetic. If you find yourself engaging in a business deal with a person with far less experience than you, and you see an opportunity to take advantage of them, consider an alternative. Encouraging them to seek input from a more experienced colleague, for example, will show that you are a person of integrity and that will lend to your credibility, not undermine it.
3. Value Your Ego Above Logic
I once watched a person incur millions of dollars in legal expenses because they couldn’t “let the other side win.” The other side did, in fact, win, and this person lost all credibility with colleagues, family, and friends. They also became essentially desitute. We’ve all seen it – the battle that is based on principle, even when it’s clear the battle is unwise, imprudent, or even downright stupid. In nearly all circumstances, it can be traced back to an inflated ego. If you are placing a higher value on your ego than you are on a prudent course of action, you are already failing. People will no longer trust your judgment because they recognize it is motivated by self-preservation and not wisdom. In some instances, credibility is lost forever.
4. Favor Winning Over Integrity
Sometimes the right choice is the one in which you lose some money. I represent an organization that received an offer to host an event. The event had been previously hosted by a competing organization that was suffering financially. My client knew that accepting the offer would force the competitor out of business, so my client declined to take the event. Contrary to what you may be thinking, my client did not lose money and opportunity. Instead, word spread that my client had made the decision to protect a competitor, which encouraged other event organizers to reach out and offer new opportunities. Likewise, the competitor reached out to my client to form bonds of cooperation that resulted in new products and other opportunities. By valuing integrity over money, my client’s credibility skyrocketed, which resulted in more opportunities than ever. The alternative would have been to put a company out of business and be named the “reigning champ” of the space. Great for the bottom line, but horrible for credibility.
5. View Business as a Zero-Sum Game
For every winner, there is also a loser. Actually, that’s how sports work, but not how business should work. In business, the paradigm is not about winning and losing, but about growing, learning, and succeeding. People on both sides of a transaction can almost always benefit, and the more you focus on longevity of relationship and wins for both sides, the more you will see that the “zero sum” game is a sham. Most business people also eventually hate to do deals with a person who can only see one winner and one loser. As I’ve said before, a zero-sum game only exists to people with no vision or ingenuity. If you want to lose credibility forever, attempt to make a loser out of every opponent in your business dealings.
What’s the alternative to destroying your credibility? Improving and nurturing it. There are many more wins available for a business person with unshakeable credibility. Don’t believe me? Try it on for size.