Relationship Economics, a Refresher!

What makes some professionals more successful than others? Who do some professionals never quite seem to reach their full potential? How do some sellers make President’s Club year after year? Sales professionals and their leaders try to answer these questions but often disagree. To many, it must be the product, the market, the lack of sales training, or a piece of RevOps technology that our competitors have and we don’t. We dive into obscure languages such as MQLs, SQLs, MEDPICS, and NRR. And the news the doom and gloom peddlers feed us do little more than propagate a narrative that somehow success is increasingly less attainable.

Do products, the macro market conditions, continued sales training and development, and the latest sales tech platforms help, of course. But there is connective tissue, a prevailing topic that, regrettably, isn’t taught in our schools. It’s seldom part of interviewing, hiring, onboarding, or performance evaluations. It’s somehow assumed that we’ll all pick it up through osmosis. We know what it looks like, and we’re in awe of people who do it effortlessly and successfully. But throughout our careers, we’re never quite sure if we’ve mastered it. Welcome to Relationship Economics®.

Relationship Economics® - derived from the infusion of the perceived “soft skill” of engaging and influencing others, with the ancient term used by Ancient Greeks meaning ‘management of the household,’ as the building blocks of our economy, emphasizes a systematic approach to identifying, building, nurturing, and leveraging personal and professional relationships to achieve business goals, increase efficiency, and create a competitive advantage.

This approach is not just about networking or making contacts for immediate gain; it's about strategically investing in relationships as a critical asset, much like investing in skills or technology to achieve long-term, sustainable value. Here are several fundamental principles that may be worthwhile for you to consider:

• Strategic Relationships: It’s essential to be selective about which relationships to invest in, focusing on those that can bring the most value to an organization. This includes understanding the potential of each relationship and how it aligns with strategic goals.

• Quantifiable Value: I suggest that relationships can and should be assessed in terms of the value they bring to an organization. This value isn't just financial but also information, influence, and innovation.

• Portfolio Management: A relationship portfolio should be managed like a financial one. This means investing in diverse relationships, balancing short—and long-term returns, and continuously assessing the portfolio's performance.

• Relationship Currency™: There is a give-and-take in the economy of relationships; I’ve long talked about the 'currency' of these exchanges. This could include mutual support, information sharing, and other non-monetary value exchanges that build mutual trust and respect. This concept drives our favor economy.

• Lifecycle of Relationships: Relationships are dynamic and can change over time. When you understand and proactively navigate their lifecycle, from creation and development to maintenance and even possible decline and revitalization, you’ll be profoundly more efficient and effective in your relationship investments.

• Personal and Professional Growth: Developing one's skills and values is crucial to Relationship Economics because it enhances what one can offer within each relationship. Continuous personal and professional development is a key part of contributing to relationships meaningfully.

• Networking with Purpose: I strongly advocate for intentional networking that is aligned with personal and professional objectives rather than networking for its own sake. Let me add intelligent networking here, as most professionals abhor small talk!

• Technology Leverage: Using technology to maintain and enhance relationships is also part of Relationship Economics. This means using tools like CRM systems, social media, and data analytics to better understand and serve your portfolio of relationships. The biggest challenge for many, and an opportunity for Avnir, is that CRM has forgotten the R.

• Adaptability: Being adaptable in how relationships are managed, recognizing when patterns of interaction need to change, and being open to new ways of connecting with others.

As we wrap up ‘23 and embark on the headwinds, uncertainty, fear, doubt, chaos, if not continued volatility that we all face in ‘24, I would submit that Relationship Economics is the definitive relevance with significant applicability in today's hyper-connected business world, where the ability to collaborate, influence, and create value through relationships can be one’s only significant differentiator. It encourages individuals and organizations to think strategically about their relationships, invest in them wisely, and leverage them for mutual benefit over the long term.