Honesty is one of the better policies

A young immigrant entrepreneur is quoted as having once said “You want to lose all of your customers? Lie to one of them.”

Like most axioms, it is a battle hardened truth that the next generation enjoys ignoring, just as the previous generation did (and no, that is not an intentional dig at one of the elder presidential candidates, though this shoe fits snugly). All relationships are built on trust, including the primal relationship of commerce. Where our immigrant entrepreneur zeroed-in on reality is the all-and-everything mechanics of integrity, branding and markets.

His conclusion was that if you lied to one customer, he or she would communicate to your others. This 20th century businessman, who landed in America before the First World War, understood buzz marketing, or at very least negative buzz. Give one person a reason to disbelieve you and soon everyone will. When members of an industry routinely do this, it tarnishes everyone else’s reputation in advance. Hence the ageless joke that 90% of lawyers give the other 10% a bad name.

Companies are a collection of individuals, who separately and collectively communicate the company’s brand to buyers. Since everyone’s ethics differ, left unattended each employee would communicate a different corporate ethic to the world. Given this reality, corporate culture and ethics are key ingredients in a company’s brand and fortunes. Simply stated, honesty and integrity are (or are not) part of your brand and you default to them not being so if you do not instill and enforce it in your corporate culture.

My friend Ray Zinn, the longest serving CEO in Silicon Valley, defines integrity as doing the right thing even when nobody is watching (watch for his book Tough Things First this November). Any organization that does not instill this basic premise into their culture runs the risk of someone, someday lying to that one customer that will cause all the others to leave. The opposite result comes from diligent attention to honesty, adding meaningful value and routinely exceeding customer expectations. These generate positive buzz, but like integrity must be part of the corporate culture to become part of the brand.


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