It’s hard for me to believe that in 2016, a full eight years after I published the original edition of Relationship Economics, I still see a broad range of professionals making naive mistakes regarding their relationships. This could be excused if the ones making the mistakes were brand new hires who don’t even know where the coffee is. It might even be understandable, if not excusable, among mid-level managers. But here’s what makes me crazy: To this day, senior executives and even board members continue to do incredibly dumb things with regards to relationships. Those who have the most call to be astute are still showing their naiveté.
I offer a refresher on Relationship Economics. Three pillars form the foundation of my approach:
- Intention. The central tenet of strategic relationships, that pillar on which all else is built, is simply to be more intentional. You cannot invest in everybody equally, so how will you be proactive about identifying, relating, nurturing, sustaining and capitalizing on your strategic relationships?
- Choice. On any given day you can only talk to so many people—20, or even 50, or for a really motivated individual, 100 different people. Which ones? And how do you know? If you aren’t following a systematic, disciplined process, you might as well be picking lottery ticket numbers. Too often people let impact on financial performance drive their priorities. I hear, “I’m following up on my people on my pipeline” if you’re in sales. Or, “I’m leveraging some media contacts” if you’re in PR, or, “I’m reaching out to my best potential investors” if you are an entrepreneur. Every one of those is myopic because it is focused on transactions, not on relationships that can truly transform your business.
- Investment. Relationships require time, effort, and resources. It takes time to pick up the phone and call somebody. It takes more time to meet them for coffee. It takes that much more time to sit down to a meal. We haven’t even talked about you leaving town yet. Almost every move you make comes at an inherent cost. You must be willing to consistently allocate the time, make the effort, and spend the resources required to invest in relationships.
Eight years after I published Relationship Economics, these three pillars stand as strong as ever. Astute executives cannot afford to overlook them.
The strategic relationship ecosystem
Over the years I have learned that relationships exist in an interconnected ecosystem. That web of connections doesn’t maintain itself; your intention, choice and investment are what keep it alive and thriving. When a connection is damaged, for example through misaligned expectations or the departure of a key relationship, you need to regain that lost ground. You must make time for repairing the misunderstanding or integrating a new relationship into your ecosystem. This requires prioritizing actions that create opportunities to reconnect, reinvigorate and reinforce that web.
You would think the HR function would be prioritizing the relationship ecosystem, but in my experience, it falls far short. HR is typically so focused on the transactional—not to devalue payroll, benefits and performance evaluations—that they neglect to help their talent develop relationship expertise early in their careers.
The ripple effect from that neglect becomes far more detrimental to the entire organization over time. Think of missed market opportunities. Think of great talent that leaves because a manager keeps angering valuable employees. Think of investments that we miss out on. Think of suppliers or partners that won’t work with us. Think of the cost of a bad hire. On and on, the ripple effects become painfully obvious. If you investigate what went wrong, if you unravel each situation, I submit you will find a causal relationship between these missed opportunities and individuals who didn’t learn about, appreciate and adopt the necessary behaviors to identify, relate, nurture, sustain and capitalize on strategic relationships.
We need more understanding of how to apply the three pillars of strategic relationships to maintain and enhance our company’s entire relationship ecosystem.
Reach more desired outcomes, faster
Beyond your educational foundation, beyond your personal pedigree, your portfolio of relationships is your biggest asset. Think about it: that portfolio opens up new opportunities. It helps us find jobs. It helps us find investors. It helps us find soul mates. Personally and professionally, your relationships accelerate your ability to get things done. And yet, they remain an underdeveloped asset for most of us.
Ask any individual who has been successful by any measure and you are likely to hear that above and beyond money, their time is their most valuable resource. Relationships can help you achieve that outcome you’re after in a month versus six, or six months versus a year, or an hour versus a day. What is the value of that time? What is the value of that relationship? Solve that equation and you will see clearly the quantifiable benefit of developing the asset that is your portfolio of strategic relationships.
Wanted: more education, early in careers
Very few people really understand the dynamics or significance of relationships. On the one hand, relationships are thought to be a soft skill, something nebulous that we all recognize is important, but not something we can teach or train. On the other hand, economics is understood to be a hard, well-defined discipline. My approach is to marry the nuances of relationships to the quantifiable methodology of economics.
To this day, unfortunately, a fundamental appreciation of the value of relationships, not to mention the skills, knowledge, and behavior that develop that asset, are still not taught in our schools. Furthermore, I’ve yet to see relationships as part of any firm’s new hire training program. It is to this day not part of executive education, not part of leadership development, not part of anybody’s career path. I cannot state strongly enough how significant appreciation of the value of strategic relationships is, early on in their careers.
As frustrating as that is, it is also a source of opportunity. Until strategic relationships are as widely appreciated and adopted as other fundamentals taught in business schools, the individuals who do master strategic relationships skills—and the companies that employ them—command a source of competitive advantage.
- Strategic relationships are built on the three pillars of intention, choice and resource investment.
- Relationships ecosystems require maintenance. We must prioritize mending misunderstandings and integrating new relationships to replace ones lost over time.
- Strategic relationships help us achieve our desired outcomes more quickly. Sadly, this is too seldom taught in schools or prioritized in talent development.
David Nour has spent the past two decades advising executives on building business relationships. In the process, he has developed Relationship Economics® - the art and science of becoming more intentional and strategic in the relationships one chooses to invest in. In a global economy that is becoming increasingly disconnected, The Nour Group, Inc. has worked with clients such as Hilton, ThyssenKrupp, Disney, KPMG and over 100 other marquee organizations. David Nour is a strategic relationship keynote speaker, consultant, and advisor that helps these companies drive profitable growth through unique returns on their strategic relationships. Nour has pioneered the phenomenon that relationships are the greatest off balance sheet asset any organizations possess, large and small, public and private. He is the author of nine books translated into eight languages, including the best-selling Relationship Economics - Revised (Wiley), ConnectAbility (McGraw-Hill), The Entrepreneur’s Guide to Raising Capital (Praeger), Return on Impact (ASAE), and the 2017 forthcoming CO-CREATE (St. Martin’s Press), an essential guide showing C-level leaders how to optimize relationships, create market gravity, and greatly increase revenue. Contact David Nour to learn more, subscribe to the Blog, sign up for the Rendezvous Newsletter or request his speaking schedule availability for your organization’s next event.