In a recent column, I talked about the underappreciated C of Credit—Curiosity. There’s a facet of curiosity that requires a skill that can only be acquired through practice and experience. It’s called the art of conversation.
Put away your mobile, and just talk
Conversation is a part of overall communication between any of us and any of our customers. A curious lender who is also skilled in the conversation collects a great deal of information. In fact, he or she becomes a virtual sponge.
Of course, one can overdo the collection of information.
It takes some level of experience to sense the value in what you hear.
Understanding what that value is separates a really good business developer from a mediocre one.
Perhaps it’s less the quantity of information and more the type.
When we are engaged in due diligence on a new credit request, we have our checklists, formal or informal. They might consist of the questions that we know the chair of the credit committee usually asks. Or they might be the product of your own enumeration of details associated with evaluation of the official Cs of Credit.
But when it comes to face-to-face interaction with prospects or customers, we have to be good listeners. And that gets back to being curious.
Conversation in pursuit of information or in the building of a relationship is skill that can be cultivated. Experience helps and mentors can aid this process in significant ways.
Going beyond the financials
Lenders need to develop the ability to form an assessment of the basic skills of the borrower.
There are two primary benefits—competitive advantages, most likely—possessed by those who are skilled in the art of conversation.
One is a core component of salesmanship.
What makes my customer tick? What does he or she like? What does the customer dislike and why? How can I ingratiate my bank and myself with this customer?
The other benefit is the way it assists in assessing the character of the borrower.
We pick up a great deal about values and attitudes in conversations with our customers. The better we know each other—customer and banker—the more candid we usually are and the more we learn.
And therein lies a story.
My friend—and customer—George
As I think back about my favorite customers, I had a unique and a cultivated relationship with each one. We often came to know each other’s families. Sometimes we had friends in common. We shared ideas about business, but in the process we also revealed much of our values and our ideals to one another.
One of my favorites was George, a feedlot operator. His back was to the wall in the 1980s when cattle prices and farmland prices were in the tank. He was stressed financially and was candid about his situation.
We had become friends over the few years I’d banked him. After my then 16-year- old son had open heart surgery, he invited us as a family to drive the 150 miles to his feedlot in a neighboring state. It was big business, annually handling thousands of cattle and supported by nine sections of agricultural feed production. His was a vertically integrated business and no small operation.
For three days, my wife, twin sons, and I rode horseback, ate leisurely meals, and talked with our friends. It was exactly the tonic my recuperating son needed, and from that weekend, his mental state began to improve. His recovery, which ultimately was complete, started in earnest that weekend.
What did George know about a teenager recuperating from open-heart surgery?
It turns out that his office manager’s daughter had had a heart transplant three years earlier. George himself was a man who collected and assimilated lots of information and he was also a shrewd observer. He figured out that his manager’s daughter needed to learn to ride a horse for recreation and for rebuilding her strength and endurance. He regularly provided those opportunities and she improved dramatically in a short time period.
From that kindness extended by George to my son, I learned more about George than I could have any other way. I observed his family’s dynamics and the relationship he had with his wife of many years and his six children, five of whom were involved with him day-to-day in the business.
And we talked a lot and about many different things.
George and his wife are gone now. But my memories of them are strong and happy ones. They are laden with positive value judgments that I couldn’t have acquired or learned about the man and his family other than by just talking as friends.
We started out as two professionals, one a banker, the other a farmer, but we became a team. I know this must sound corny to some, but that’s how I viewed it. George earned my loyalty more completely and more thoroughly than could have occurred any other way.
Get to know your customers
I have another story about George that is remarkable as I think about it. None of it I’d ever have known without the ability to just talk and get to know him. Maybe I can share that story some other time.
For now, understand that these are the values of the art of conversation. If you want to cement long-term relationships, then learn how to talk with and listen to your customers.
If you don’t like what you hear about personal character or the riskiness of a deal, then you’ve avoided problems you didn’t need to have.
The alternative is also true. Applying the art of conversation and gathering useful and valuable information can often get a deal done more quickly and more soundly. And it can smooth out a lot of bumps in a long-term relationship.
They say talk is cheap. I say it can be priceless.
And that’s real competitive advantage.