Profit from Ties

THERE are two very different generic perspectives on sales — either salesmen are heroes who make sure the business survives, or they are rather sad figures who expose the fallacy of “capitalism”.

In Philip Broughton’s book Life’s A Pitch, he argues that “we are all selling all the time” — not just in business, but in our relationships with others, when building friendships, buying and selling goods every day. In almost everything we do, there is an element of “selling”.

Whether we like it or not, selling is as old as trade itself, and trade is as old as mankind. As soon as our forefathers started trading with each other, selling was essentially born.

The same goes for relationships. When our very early ancestors began to realise that their survival rate increased when they organised themselves and began to live in small communities built around relationships that would help everyone to survive better, the idea of social relationships were essentially born too.

It is, however, important to note that these early relationships were mutually interdependent and were essentially about survival.

In modern times, some of these social relationships seem to have moved to Facebook and other social networking sites, but these relationships are not necessarily interdependent, and therefore the more traditional values around friendship and relationships are not necessarily the same either.

It is thought that since people started to live in communities, evolution helped to develop our brains to build strong relations with up to a few hundred people at maximum, with whom we could relate to personally and about whom we could remember lots of details.

However, as sophisticated as we have become since, evolution is not that fast and we can still only hold enough data for a certain number of close friends and family.

Research has shown that among the top five happiness factors, “family relationships” comes up top, followed by “financial situation” and “work”, followed by “community and friends”.

The work factor is not so much about salary as it is about providing meaning and the relationships we build at work, and making friends is generally very important to most people too. In essence, we need other people, and we need to be needed. We build relationships with people around us to fulfil that need, and these relationships are generally positive.

With regard to the connection between sales and relationships, we may not like the idea that relationships can be profitable, but in business, things that don’t make a profit don’t survive — it is as simple as that!

During the 1990s, marketing people came up with the idea of building lasting relationships with customers, and today we refer to it as “customer relationship management” or CRM.

CRM is basically a marketing, database and relationship-building tool, which hopes to build relationships that help the business to launch products that the customer actually wants, improve its service system, build customer loyalty and, therefore, gain more sales and opportunities for cross-selling too.

The database element is essentially managing all the data and knowledge, which gets accumulated for potentially up to millions of customers. The knowledge we as individuals store in our brains for our personal relationships now gets data-mined and stored on computers for customers. CRM is big business and many companies are pondering about how to manage their customer relationships.

The Chinese term “Guanxi” is often claimed to be the lifeblood of how Chinese business is conducted, and the equivalent in the West would probably be referred to as “personal relationships” or “connections”.

It is widely recognised that relationships in general are important for conducting business — whether in the West or in the East. However, the importance and expectations of the personal relationship may vary greatly.

There is no doubt that relationships are important for us as individuals as well as for business, and in business the aim is to provide profits through sales. If sales are built on relationships with customers, then these are essentially profitable relationships.

It is therefore fitting to conclude that if all businesses are built on sales, then sustainable sales are built on profitable relationships.

Article by Niels Kemp Rasmussen, senior consultant, Training Edge International. He specialises in helping clients uncover hidden potential and increasing performance in their organisations. 

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