Truth is a Down Payment on Loyalty

Scott Monty, a noted speaker and writer on leadership, recently wrote about loyalty in a blog post, “Why Does Truth Matter, Anyway?”

Truth begets loyalty from your customers, from your employees, from your investors—from anyone you build a relationship with. It’s a long game, though. Relationships always are.

But loyalty doesn’t come from transactions; loyalty comes from being able to trust someone from repeated actions over time. Such feelings are built, not made.

Another way of thinking about truth is through transparency. A little transparency can go a long way.

Honesty leads to transparency.
Transparency leads to trust.
Trust leads to loyalty.
Loyalty means retention.

That got me to thinking about how I dealt with my own employees to keep them interested and invested in the company.

It wasn’t a trick. It was a rather simple technique:

Once a month, I would meet with everybody and give them a state of the company breakdown — the good, the bad, and the ugly.

I would tell them what I thought the next 90 days or 6 months were going to be like, the successes and the failures, the opportunities and the challenges

Even though many of them weren’t listening or didn’t care, they recognized that I was still sharing the information. If I missed a month, they would remind me of it.

Most importantly, they recognized that I was being honest and forthright with them.

But the people who cared stuck with it. They listened intently, and they were loyal to the company because I was being honest and transparent with them. So they trusted me and the things I told them.

And those who didn’t care just moved on.

The Correlation Between A Players and C Players and the People Who Care

I’ve written before about how every company has A players, B players, and C players. And that formula follows the Pareto Principle — that 20 percent of your staff (the A and B players) generate 80 percent of the results, and vice versa.

I have noticed in all of the companies that I have led that the C players generally didn’t care about the company. Their interest was purely in earning a paycheck, not in building a career.

The problem is, I couldn’t make them more interested. No one could, except for the people themselves. Your people have to generate their interest themselves. No amount of honesty and transparency, training, or pre-game motivational speeches will get someone to become interested in your vision and your plan.

That comes from the people themselves.

That means you have to find the people who are interested and nurture and harness that interest. Show them that their interest will pay off. Give them a reason to stay interested and motivated to support your vision and your plan.

But while you can’t make someone become interested in your vision, the reverse is certainly true.

What Happens If You’re Not Honest?

While you can’t turn B’s into A’s or C’s into B’s just by being honest, you can certainly do the exact opposite.

You can turn your A players into B’s and B’s into C’s if you’re not honest.

If you lie to them, if you don’t give them the complete picture, or take an action that enriches yourself and hurts them, you’re going to damage their loyalty. (Such as giving the executives a big year-end bonus but nothing to the front-line workers.)

Do this even just once, and you will lose more people because the opposite of what Scott Monty said is true:

Dishonesty leads to duplicity.
Duplicity leads to distrust.
Distrust leads to apathy.
Apathy means turnover.

This Happens With Customers, Too

This is also how you lose customers.

The minute a customer catches you in a lie, they will never, ever trust you again. If you lie about why a shipment is going to be late, or you just never tell them, they’re not going to trust you.

If they don’t trust you, they won’t be loyal to you. And that means you’ll lose them the first time someone offers them a better deal, or even just tells them the truth.

But it has also been my experience that if you are blunt with people, they may not like it, but they certainly appreciate it. If they know you’re being honest, that will at least make your bad news easier to take.

I remember when I first took over Robroy, there was a particular distributor who just had a hate on for us. I don’t know why he was so angry, but he was. For one thing, he threatened to sue us for price fixing.

I went to his operation and met with him. I was very open with him and said we do not price fix, ever, and I was happy to show him.

I also said, “If you don’t feel we’re being responsive or that we’re being irresponsible, just return all your inventory and I’ll give you a credit for it. We’ll all go on our merry way, and no harm done.”

He decided that maybe we weren’t price-fixing and that I didn’t need to take all his inventory back. In fact, our relationship not only improved, it turned into a good and positive one, and we worked together very well for many years.

Part of that was because he knew he needed us more than we needed him. But more importantly, he realized that I was being open and honest with him. I was telling him the truth — that we didn’t price fix — but that I was telling the truth about taking his inventory back and giving him a credit.

He knew that if I wasn’t lying about price fixing, I also wasn’t lying about ending the relationship.

In the end, it was my willingness to tell him the truth that saved the relationship and turned it into a great one that benefitted both companies.

I’ve been a manufacturing executive, as well as a sales and marketing professional, for a few decades. Now I help companies turn around their own business, including pivoting within their industry. If you would like more information, please visit my website and connect with me on Twitter, Facebook, or LinkedIn.

Photo credit: NoName_13 (Pixabay, Creative Commons 0)