While many managers have embraced virtual meetings to replace face-to-face meetings in the wake of the CoVID-19 pandemic, building new business relationships online presents a special set of challenges. Since successful relationships are built on trust, it’s important to try to address the pitfalls of virtual interactions.
As described in our book, Finding Trust in the Global EconomyJust before the pandemic, we interviewed 82 managers from four regions of the world about how they decide to trust new business partners. Their answers varied by region and culture. For example, we found that managers in both Latin America and the Middle East/South Asia want to spend time getting to know potential new business partners in person to build trust. In Latin America, managers were using this time to assess the shared values of potential business partners, while in the Middle East/South Asia, managers were focused on assessing respect for different values.
Then in November and December 2020, We re-interviewed 21 of these managers. And asked them how the pandemic is affecting their ability to develop new business relationships. We realized that their cultural differences are still dynamic. For example, trust did not change during the pandemic. It was still lower in Latin America and the Middle East/South Asia than in East Asia and the West. However, the managers’ shared experience with virtual meetings led to a consensus: It is nearly impossible to build the kind of trusting relationships that have sustained businesses during a pandemic when only virtual meetings are available. I am capable. He explained that virtual meetings are transactional, but new business partners need deeper relationships to decide whether to trust them.
Here, we discuss the specific challenges managers face in building business relationships in practice. Then, we offer four pieces of expert advice for overcoming these challenges.
Our pre-epidemic interviews identified four criteria that managers used to make trust decisions: openness, competence, respect, and rapport (i.e., similar values). Our interviews during the pandemic highlighted how difficult it is to find information to judge potential partners against these criteria when social interaction is limited to scripted, time-limited, online interactions.
For example, a manager from Japan explained:* “It is very difficult for us to assess the degree of competence. [meeting with them]Another Hong Kong manager added, “I think it’s very difficult to convince people to sign a billion-dollar deal, let’s say in Cambodia, without actually seeing the land or seeing it.” Have seen the plan.”
Participants also lamented that online interaction limited their ability to see and hear how potential business partners interacted with each other. A manager from Thailand explained that it was difficult to understand the decision-making process in a potential partner’s company when meeting in practice. His company ultimately held off on making a final decision until there was a break in the pandemic and they could meet in person. He told us, “Once we did ‘look and see,’ we realized that all their decisions were made by one man. Well, it ended up that we didn’t work together.
Advice from expert trust builders
Two years into the pandemic, everyone has learned a lot about what they can and can’t do online. The managers we interviewed gained important experience and wisdom as it relates to building trust with new business partners. Here are four lessons from their experiences.
1. Don’t leave out personal items.
Although taking the time to get to know others in virtual settings is less than ideal, it is still important to build trust in the context of building new relationships. Why it’s important to be intentional about making time for more personal conversations:
Because in virtual space you get less opportunity to know other person. Time is very limited. You don’t start talking about your family or how you grew up. I think it’s harder to talk about personal things in a virtual environment than going to lunch with someone where barriers go up or come down after being together for 30 minutes, an hour. – Manager from Bolivia
These are the things you don’t learn because everything is on the agenda. If you hold an online meeting, you don’t allow enough time for offline discussion, which gives you clues. – Manager from Germany
We were all listening and watching video and all that but still face to face is preferred. [In in-person meetings] You have all the conversations on the other side that will happen after meetings and stuff. [Those side conversations] Currently on WhatsApp or iMessage and phone calls. But that’s just it [quick] Catching a cab or something like that. These are the personal moments you build trust with your partner. – Manager from Singapore
2. Use your networks.
People you trust in your existing networks can introduce you or help you evaluate potential partners. They can act like a broker for you. Clarify what interests you might have in common with a potential partner and what questions you have about them. Here’s what a few participants had to say about networking:
There is no formula. You just have to find the people in your network who can be the most helpful to you and who are willing to be helpful. And I have recognized three or four of them. I’ll go to them and say, “I need to meet someone special. Can you help me introduce myself?” – Manager from America
An existing German customer introduced us to its Austrian subsidiary. And we had a good season with Austria. But then, there was a corporate realignment and I thought we might lose all of that company’s business. Instead, the new management at the top, who we had not worked with before, reached out to say they wanted to continue with us next year. – Manager from Italy
Importance of references [skyrocketed]Because it’s not easy to connect with someone you don’t know. People ask for more and more referrals. Because right now, we can’t contact people anonymously. You have email and everything, but it’s not enough. – Manager from Turkey
A Japanese manager explained that he identified a potential new business in Taiwan, but with the pandemic, he was unable to visit the site. Instead, he turned to another Japanese company he trusted and knew there were people in Taiwan who could visit the site and meet people. “Now, we usually ask a trusted third-party company,” he told us.
3. Consider trying a new partner.
If someone is approaching you about a new business, start with a smaller investment than if you could meet them in person. Likewise, if you’re talking about new business, understand that a potential partner’s preference for small deals initially may eventually lead to larger deals. A manager from Saudi Arabia told us:
This was the transaction we closed last week. It was the first time we did a deal with this partner, but we really liked the opportunity and we liked the markets and our due diligence was positive across the board. We were ready to invest huge funds in this particular investment opportunity. However, due to our inability to meet the team face-to-face and see the company with our own eyes, we decided to make our own investment. We said we would like to invest a certain amount now and have the option to invest additional money in the future once we meet face-to-face.
4. Share expertise with trusted partners.
You can help them streamline their processes — generating savings — or provide better service to their customers — generating new business for them and for you.
A Nicaraguan manager explained:
We are building some online tools to help them sell their products. It helps sell our products, but also helps them sell all the products they carry. This has helped us grow our business with them because they see that we are willing to help them. that it is more than just a business; It’s like trying to help each other survive in this new environment.
Another manager from Finland told us that his company’s equipment has the ability to transmit digital performance-related information. Customers who didn’t opt for the service in their original contracts were asking how to turn it on and get the most out of it during the pandemic. The result was new business for his company, and new ways of marketing services that his company could provide.
The Future of Trust Search
Participants agreed that learning to work online during the pandemic will make a lasting difference, but that in-person meetings should not be completely abandoned when deciding whether to trust a potential new partner. As one Italian manager put it:
Well maybe [do more] Online after CoVID-19, but I don’t think it’s going to be just an online thing, because we’re human. Everyone wants to go back to what we used to do, but there are still some meetings that both sides think we can do online.
And as one US manager told us:
I think it’s going to go back somewhat to the way it was with in-person meetings, but I don’t think it’ll ever get there again. The pandemic is going to be very long. And you’re going to develop new habits and new strategies and new communication tools that you’ll get used to and become quite comfortable with. And in many cases, you’ll find that’s good enough. It’s not as important for me to be in person in some of these cases where it would have been in the past. It’s not as good as being in person, but it allows me to use my time better and I don’t have to make every single trip I’ve made in the past.
. . .
As the pandemic continues to interfere with in-person business growth, managers have become more resigned to communicating online, and even see some benefits. Yet, what dealing with Covid-19 has taught us is that when it comes to building relationships for new business relationships, it’s important to use business relationships intentionally. Resist the urge to take time to have personal conversations online, use your networks to make connections and vet potential partners, take big risks or say no to a deal altogether. Consider a limited trial before, and find creative ways to help. Trusted partners streamline and grow your business.
*Editor’s Note: Quotations from participants have been lightly edited for clarity.