by John Melendez

Created on: July 22, 2009   Last Updated: July 25, 2009

Business 101: Use a "Favor Bank" When Nothing Else Works

Favors: Best Served Light, and Over Lunch

IDEALISM VS PRAGMATISM

"Who is John Galt?"

- From Atlas Shrugged by Ayn Rand

Back when I was a newly arrived businessman, fresh out of college, I used to emulate (and perhaps idolize) Ayn Rand's premise that you would be able to get ahead in the world based on the notion that you should rightly profit through the merit of your own good work, by the sweat of your salty brow.

All and good. But don't forget the kind of world we live in.

When the going gets rough, the rough get going - by picking up the phone to call in a few favors.

"THE FAVOR BANK"

Given the passage of years of in conventional business transactions, I've been witness to an age-old business practice - where favor is a bartered commodity.

In its worst form, it rears its ugly head in the shady world of old-boy politics and back-slapping of the kind we see in corrupt government organizations. In its best of forms, we see it as the brokering of favors between two good friends meeting each over lunch, with one paying for both meals in exchange for some help in-kind.

No matter how bright or dark the package is, this indefinable exchange of non-currency commodities is what I affectionately call "the favor bank".

WHAT IS THE FAVOR BANK?

Through the culling and currying of favors between two parties, folks may enjoy a form of friendly bartering that can actually make a difference between getting something done and having it otherwise stand idle.

By doing a favor for someone, the idea is you have "made a deposit" in an unseen bank, with a similarly unseen implication that the other person now "owes you" a favor in return, perhaps at some undisclosed time.

FOR EXAMPLE

So, what does this banking of favors actually mean? I'll use one of my recent transactions as an example.

As a relative newcomer at my place of work I recently made the acquaintance of a business colleague who's been with the company for decades. He is well-placed, is a walking encyclopedia for his field of expertise, and is obviously a great resource into which I could tap for information critical to my job well.

The problem is: this guy is busy. And he has loads of friends and resources at his disposal without having to deal with a small fry guy like me. How to overcome this dilemma?

In my case, I offered something that works perhaps at least 80% of the time: free lunch.

Despite the fact that mom and dad raised me

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