From time to time, I talk about the importance of being predictable in business, including this item about avoiding surprises. 

What happens if another party is unpredictable?  Think about this in the context of your business.  How do you feel when a supplier changes the price without notice?  What happens if a customer cancels an order, or refuses to pay for services after they have been delivered?  For many businesspeople, situations like these are seen as problems and, in some cases, they can cause significant financial challenges for customers or suppliers.

It seems to me that, trust is based on - or at least it should be based on - a variety of factors, including predictability, reliability, and knowledge.  To the extent that trust is important in one’s business, what steps might be taken to build trust?  From a training perspective how might these steps be encouraged?  How about from a process perspective?  From a human resources perspective, how can trust be encouraged?

To the extent that one believes that trust is important in business, one can build trust through steps like:

1. Communication
2. Following through on commitments
3. Engaging others in helping address the issues
4. Explaining the reason for changes, well in advance of the changes being made
5. Explaining one’s perspective so that others understand why the changes are needed and what is to be accomplished by the changes
6. Minimizing the changes that one makes, both in terms of number of distinct changes and the size of the changes that are made
7. Creating options that will help others be more successful
8. Finding ways to add value for the other parties to transactions
9. Establishing clear plans, including approaches for dealing with problems that one might reasonably expect to occur

Suppose that these steps are important, how can a firm encourages these steps?  The answers vary by context.  A few possibilities include:

1. Using a systematic approach for making changes
2. Defining a clear vision and metrics for determining whether the goals have been realized
3. Measure the results to decide if the goals have been realized
4. Maintain a regular dialogue with key members of the value web
5. Listening to concerns that customers or suppliers raise and seeking opportunities to work with them in ways that better meet their needs
6. Seek a managed evolution of business, rather than radical transformations

Taking the sort of approach described in this posting helps businesses manage the risk associated with making changes.  Most changes will be seen as natural progression and draw little attention because they are perceived as “boring.” 

Boring is a compliment, when one looks at the altenatives.  Think about the “excitement” of not knowing how one will make payroll, being uncertain if customers will be interested in one’s products, promising products that are still prototypes, or pushing the limits of one’s financial reserves.

Filed by Coleen Davis at 12:32 pm under Business Acumen, Solving Problems