Profiting From Trust

If you haven’t thought much about the value of trust displayed in an organization then you may have only considered it to be a virtuous characteristic. You may be both pleased and surprised to learn that your ability to develop and nurture a trust within your organizational culture can prove to be psychologically and financially rewarding. In their book, The Trusted Leader, Galford and Drapeau, discuss three kinds of trust: Strategic Trust- that the organization is doing the right things. Have the correct goals and strategies been established to assure successful accomplishment of the mission of the company? This is the validity test. Organizational Trust- Can one have faith in the way things are being performed? Are the processes and decision-making procedures reliable? Personal Trust-Can the leadership of the organization, as people, be trusted? Is there mutual trust among your associates? Do your employees believe you will treat them fairly and be considerate of their well-being?

Creating a climate of trust is the basis of a powerful tool known as collaboration. Collaboration is the critical competency for achieving and sustaining high performance as we learn from Kouzes and Posner in The Leadership Challenge. It won’t be the ability to fiercely compete but the ability to lovingly cooperate that will determine success. Trust is the central issue in human relations within and outside an organization. In the absence of trust there can be little progress or leadership. PricewatershouseCooper learned in a study that for innovation, trust was the number one differentiator between the top 20 percent and bottom 20 percent of companies surveyed. In other words, the more trust we feel, the more innovation is possible. Psychologists found that the more people are trusting, the more likely they are to be happy. People also don’t tend to stay long in organizations devoid of trust. Furthering that trust is the most significant predictor of an individual’s satisfaction with their organizations. Think about the contribution to profit or reduction of costs that will benefit as a result of higher innovation and lower turnover of personnel. Building and maintaining trusts supports both these opportunities for competitive supremacy.

When you adopt and foster trust as a leader, you are assuming the risk of being open to influence. This will build more trust and position your constituents to be open to the influence of leaders. There is a reciprocal principle here that trust builds trust. Try it. Consider the flip side. Self-protective behaviors will characterize managers who have created distrusting cultures. Their style needs to be one of more direction and holding tighter controls. This takes a great deal of energy and has little chance to engender creative contributions. A negative cultural spiral develops. Working for a distrusting manager can easily lead to an environment of more control whereby information may be distorted and withheld. This result is needlessly costly and unproductive.

Here’s a catch. To build trust you must be willing to take some risk. The risk is to expose our vulnerability to others whose behavior may not be predictable. Have confidence in your mission and your vision. David Crockett, our famous American frontiersman, Congressman and defender of the Alamo lived by the following motto: “Be sure you’re right, then go ahead.” As a leader or executive, people are looking up to you. Leadership is primarily defined as someone who has followers. There must be some value delivered accompanied by boldness in leadership, otherwise your people may well be following someone else.

Risking trusting behavior will yield greater rewards as your associates will gain confidence in themselves based on the confidence you have demonstrated both in yourself and in them. Going first with trust or “self-disclosure” lets others know about our values and positions. We get to express our beliefs, hopes and dreams and what we are willing to sacrifice to achieve success. We can further share what we are not willing to do. Where do we draw the boundaries of acceptable behavior? What courses of action are ethically acceptable? What actions won’t be tolerated?

In an environment of trust, when mistakes occur, there is a greater opportunity for an open dialog to diagnose the causes of problems and create a meaningful learning experience. Within a trusting culture, a leader would be more likely to learn the truth more fully and quickly. With this advantage, solutions can be developed rapidly and costs could be saved. Client satisfaction would be enhanced. You can save your company time and money resulting from enhanced credibility with clients to retention of workers to innovative contributions. The benefits from taking the risk to show trust will pay off. The leaders must show courage to collect these rewards. Trust me.

Joseph Greco is president of Greco Apparel. Visit them on the web at www.grecoapparel.com