Life is about contracts

Did you know that life is about contracts? I thought only lawyers worried about contracts, and then I read the following:

“Life is always about contracts that you make with people. Very few of them are written. Most of them are implicit, and most evolve out of a course of dealing and understanding. And if you are good for your people, they’ll be good for you.” – Lloyd Blankfein, CEO of Goldman Sachs [1]

In the broad sense used by Blankfein, contracts include commitments, promises, arrangements, bargains, compacts, conventions, pacts, pledges, understandings, allegiances, and loyalties. They are comprised of the myriad daily transactions that build up mutual trust leading to long-term relationships, be they personal or business.

As business owners and entrepreneurs, we develop implicit contracts with our customers, suppliers, employers, lenders and investors. While more and more of these relationships are today based on formal written contracts, those contracts by no means capture all of the dimensions of the relationships involved.

Some formal contracts are the foundations of relationships. In other cases, they are the fences setting the bounds but not defining the relationship’s potential. But relationships based solely on formal, written contracts seldom have the resiliency necessary to sustain themselves when the ground twists and turns beneath our feet.

Think of the potential – every person you meet or deal with has the potential for a mutually beneficial long-term relationship. Your actions and reactions during those interchanges will form a large part of that future relationship tapestry.

What kind of pictures are you painting?

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[1] Quoted in “The Most Influential People in the Boardroom,” Directorship, October/November 2009, p. 33