Achieving Business Excellence with John Spence

Signed With a Handshake: How Trust Builds Good Companies

Recently I rehandshakecommend a great book from Bernie Swain called “What Made Me Who I Am.” I was very impressed with Bernie and his approach to business so I asked him if he would share a guest blog for my readers (that’s you). I really love what he sent, and I think you will too, it is a great testament to how important it is to build honest and real trust with your customers. Here is his article…

When you start your first business, it is hard work. The odds are against you. When you start your first business in an industry you know nothing about (other than what you read in a magazine), it is virtually impossible to succeed. And yet, that is exactly what my wife, my business partner and I did more than 35 years ago, when we hung out our shingle as the Washington Speakers Bureau.

No matter how you start, you will quickly learn some important lessons about finances, products, customer service, marketing, and, if you are like us, the need for a business plan. These are the fundamentals of any business. You also learn about the intangibles necessary to succeed, such as leadership, passion, focus, integrity and trust. You often learn these through trial and error. But I learned one of them, trust, by mistake and it became a defining moment in our company.

In our first year, we represented no one. We made no money. Then after 14 months, we signed our first speaker, Steve Bell, the news anchor for ABC’s Good Morning America. Actually, all we did was shake hands. While the practice in our industry was to sign speakers to one- or two-year written contracts, we were too excited to do any paperwork.

This meant that Steve could walk away from us at any time. Loving that idea, he told some of his friends, a group of Washington journalists, that we didn’t require signed contracts and if they went with us, they, too, could walk away.

This mistake attracted our first stable of speakers, all on a handshake. It did one other thing, totally unanticipated. It established an atmosphere of trust. We knew that we had to work hard to keep our new speakers happy or they would walk. But in turn, our hard work showed our clients how much we cared. Instead of being a mistake, our handshake agreements built a deep intimacy and a bond on which we began to rely on each other. That is the basis of trust, and it was a critical turning point for our company, where we continue to “sign” every speaker with a handshake.

We went on to become the biggest speaking bureau in the business, representing many of the world’s leading figures in government, business, sports and the arts, in addition to the media. In talking to many of our clients about the challenges they faced in their careers, I realized that we were in good company. They, too, had benefited from turning points—some intentional and some by way of happenstance—that made the difference at crucial junctures in their lives.

To be sure, not every business agreement can depend on a handshake—employee contracts and vendor agreements, for example, almost always have to be far more formal.

But every company can find ways to foster trust—by delegating responsibility, say, or establishing a compensation system that gives each employee a stake in the organization’s future. The company benefits, the employees benefit and, most important, the customers benefit.

For us, the trust we have with our speakers has spread to all personal and professional relationships in our company. “Can I trust you?” is not a question we ask, but rather, “Is this the right thing to do?”

Trust builds good organizations, just like it builds good families. By contrast, “distrust is very expensive,” as Ralph Waldo Emerson put it. It tears everything apart.

Whether you discover this truth by mistake or by design, you’ll find that trust is fundamental to the success of any group of people you bring together or lead.

Let’s shake on that.

** By the way, I also do this with many of my clients. No contract, just show up, try to help them as much as I humanly can, and they send me a check. I really like doing business that way.

Comments

  1. Bill Gemmell says:

    John, great article. Whilst the norm dictates contacts as a necessary part of business, behind the legal facade a hand shake on mutual trust anchors the relationship. I’m a firm believer in the phrase “if there is a doubt, there is no doubt” and a trusted handshake is representative
    of the same commitment.

    • I love your phrase, “if there is a doubt, there is no doubt.” I will be using that in the future!! Thanks for the comment – John

  2. Barry Hall says:

    Great post from Bernie, thanks for sharing it with us John.

  3. Thank you for sharing this, John. And thank you for writing it, Bernie. Since 1999, I have worked for every author I’ve worked for based on an email, a virtual handshake if you will, saying “Pay me after I send you the finished manuscript.” And every time I tell a fellow editor that, they look at me like I’ve lost my mind. “No deposit?” they wonder. Nope, no deposit. And yet, I’ve only been ripped off four times, and only twice was I surprised. Trust goes a long way. I’m sharing this.

    Have you read Getting Naked by Patrick Lencioni? Don’t freak out over the title. It only means you don’t have to pretend you’re perfect. But it makes a point that I really like. When a prospect needs some consulting, his first act is not to bang out a contract. It’s to just start helping, consulting, and assuming the rest will take care of itself if he does the job right. Sounds good to me. I don’t go that far, but I do give away information freely, in order to build trust. I think we’ve got an internal sense of who we can and can’t trust to honor a deal made on a handshake. So do our potential clients.

    • Michael, thank you very much for your comment. Yes, I have read Patrick’s book, it is absolutely excellent for anyone who is a consultant or independent contractor. Like you, I have done literally hundreds of projects completely on a handshake and trust, and I have only been ripped off twice twice, and neither one for that much money. I would much prefer to do business this way.