In business, especially with the tumultuous economy, companies spend a lot of time weighing costs and benefits. Are the benefits to a particular venture more or less than the costs; and based on that, is it beneficial for your company to continue this relationship? This judgment is based on numbers but don’t forget about human nature. If you’re sitting there trying to figure out why you’re hitting some roadblocks trying to develop your business relationships, remember this: The maintenance of relationships is based on how satisfied a person is with that particular relationship. If we feel as though a relationship is harming us in the long run, then we will not invest our time and energy into maintenance and cultivation.
Social exchange theory explains how economic principals can be applied to your everyday relationships. Sure, you presented to the best of your abilities, but was there something that stood out about you that might have dissuaded your potential business? Were you confident in speech and material? All of these factors are going to be applied to your "social exchange," which is based on three major assumptions:
- Relationships are a matter of subtracting costs from rewards and using that to determine the outcome.
- People want to make the most out of benefits while lessening costs (also called the maximum principal).
- Human beings are inherently selfish and are going to do whatever makes them happy.
Basically what this means that human beings are going to take the good, subtract the bad, and if the outcome of that is still something they want to nurture, then that relationship will continue. If not, the relationship will no longer be cultivated. While this may not seem like something that you would consider a factor when it comes to business relationships, you have to remember that it’s theorized that this happens without our knowledge.
The next time you’re trying to figure out why you didn’t get the contract or why you didn’t make the sale, ask yourself if you presented the absolute best version of yourself. Did you look or sound erratic? Did you dress appropriately for the types of clients to which you were presenting? This theory isn’t related to just the physical and everything about you will be taken into consideration. Knowing this theory and being aware of it means even more on a conference call where you only have a couple of different ways to make an impression and to ensure that your rewards will outweigh your costs. Be sure that your presentation is in tip-top shape and that you’re well prepared before you dial in and present.
Snap judgments are okay and remember its human nature to "judge the book by its cover," so don’t feel offended if you know that’s what is happening. A way to combat this when you’re going in for a presentation is to know your audience. The most important thing in communication is going to be to know who you’re speaking to and realize that your audience (whether it be one person or one hundred) is going to judge you. That’s okay.
It’s not personal, it’s just business.
Posted by Maranda Gibson, Account Specialist