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    • Emotional Bank Accounts

    "All things being equal, people do business with people they know and trust. All things NOT being equal, people still do business with people they know and trust.”

    Reading through one the great Geoffrey Gitomer’s books lately, this quote really stuck with me because it is so true. Think about it – how did you choose your family doctor, your daycare provider, etc.? More often than not, it was because 1) you personally know and trust the person or 2) it came as a recommendation from someone you know and trust.

    So let’s break it down. What is trust? What is made up of? How is it established? Being an accountant, I am going to use a mathematical equation (sorry) known as the Trust Equation:

    T = (C + I) / R

    T = Trust, C = Credibility, I = Intimacy, R = Risk. Now some truths about the trust equation:

    1. As risk increases (choosing a doctor for an operation, choosing a financial adviser, getting advice about an important decision), the levels of intimacy and credibility must increase as well.
    2. In most cases (well, those not involving life and death decisions), intimacy far outweighs credibility (credentials/training) in importance to the decision maker.

    Dr. Stephen Covey in his masterpiece The 7 Habits of Highly Effective People describes how people build intimacy in their relationships – by making deposits in emotional bank accounts. Just like a normal bank account, people can make deposits and withdrawals from the emotional bank accounts held with other people. Often, a small withdrawal from an emotional bank account with someone can wipe out years of deposits. Also, deposits need to be made frequently and consistently with the people we deal with on a day-in, day-out basis. So here are the five types of deposits or withdrawals we can make every day:

    1. Common courtesies: the little things are big things. Holding the door for someone, letting someone merge into busy traffic, general politeness. They may seem like nothing, but without them it is not possible to make more significant deposits.
    2. Keep promises: Do what you say when you said you would do it. Don’t promise things that you know aren’t realistic – they can be huge withdrawals.
    3. Violate expectations: watch out! We’re not just talking about explicit expectations here, but implicit as well. Put yourself in the other party’s shoes – what are their implicit needs and expectations in the situation?
    4. Personal duplicity: We all do it – talk about our boss or so-and-so with a co-worker. Confessing their sins. It may seem harmless at the time, but what happens when that co-worker is under the gun? They know you are now talking about them with someone else - you have a reputation. It’s critical to establish and maintain your character in these situations.
    5. Apologize – hey, nobody’s perfect. Recognize when you have made a withdrawal from someone’s emotional bank account and correct it. Doing this can change a small withdrawal to a HUGE deposit.

    So what kind of deposits are YOU making with your customers, co-workers, friends and family?  

    03/30/2012