Trust Is Essential for the Health of an Organization – Part 1

• November 14, 2017

The health of an organization is directly dependent upon the level of trust between employees, management and customers.  Results cannot be predicted when the health of an organization is threatened. Therefore, results depend on the level of trust.  Exceptional leaders recognize all this and will work hard to build and maintain trust.  In my experience however, they are often frustrated with their efforts to build trust.  This is often because their theory of trust is incomplete, and therefore their methods of building and maintaining trust are often ineffective or prove to be short lived.

More and more CEO’s are becoming convinced that the soft skills of building and maintain trust is at least as important as technical skills for individual and organizational success.  According to Stephen M. R. Covey, a 2003 study by Watson and Wyatt showed how a high trust organization can return 286% higher total return than low trust organizations. (Covey, June 2007)

Furthermore, high trust organizations require less bureaucracy, enjoy lower turnover, are better able to manage change, are more collaborative, and can manage growth more effectively and quickly. (Covey, June 2007)

What should be our strategy to build trust? Of course, one can just trust others and hope they reciprocate.  Ernest Hemingway once said, “The best way to find out if you can trust somebody is to trust them.”  This may be true, but a leader must have a predictable plan to build and maintain trust or risk wasting time and increasing costs.  We cannot afford increased costs, nor can we live with wasted time.  We cannot afford to just trust others and hope. As Rudy Giuliani once said, “…change is not a destination, just as hope is not a strategy.”

If one of the most important responsibilities of a leader is to manage the variation in trust, then a he/she must have a theory and method.  The purpose of this 4-part series of blogs is to clarify why trust is so important, define and appreciate a definition for trust, to clarify the most effective way to think about trust, and to provide a framework for a predictable method for building and maintaining trust.  It needs to be predictable. We cannot depend on hope.

Part 1:

Our bodies self-regulate.  Water is essential for good health and performance of bodily functions.  When our bodies need water, we become thirsty.  Our thirst motivates us to drink and therefore satisfy the need of our bodies.  Without water our bodies have trouble performing basic functions such as digestion.  We can become lethargic, develop headaches, lack concentration and can even stop performing our responsibilities.

Just as our bodies send signals for water, our organizations and employees can send signals for the need for trust.  With low levels of trust people can become disengaged, unproductive and even cynical.  Successful leaders will not only trust people to do the right things, they will know how and when to provide the “water” necessary for healthy organizational function.

Some leaders still create environments of distrust.  Often there are a few untrustworthy employees who continue to perform poorly.  Their presence, and the leader’s inability to know how to act cause the perceived need for rules and policies which damage trust for all.  Even though there may be a few bad ‘apples”, why not create a system that sends a message of trust instead of distrust?  What we need is a system that allows us to provide the ‘water’ when needed while eliminating the opportunity for the few ‘bad apples’ to influence policy.  This four-part blog series will help us do just that.

To accomplish this requires an appreciation of the right definition of trust. I suggest we adopt The International Association of Business Communicators definition of trust:  “a willingness to be vulnerable because of the presence of integrity, concern, competence and shared objectives.”  Knowing that trust can be defined with four key elements, managing each of these four elements can provide us with a framework to become more vulnerable while concurrently creating a trusting environment.   A trust environment will help us to bring out the genius in every employee.

We also need an effective leadership model and theory.  The leadership model best positioned to create a trusting environment is called THINK – BEHAVE – IMPROVE (TBI).  TBI clarifies how an optimum leader thinks in order to create a trusting environment, how he/she must behave to create trust, and how he/she takes action to improve the organizational trust.  Because trust is not a destination and because of the speed and frequency of change, trust must be managed constantly.  Just as one can’t just have one glass of water a day and expect to maintain personal health, a leader must be able and willing to provide ongoing trust when needed.  It never ends.

Soft skills are needed more than ever today and the ability to build and maintain trust is one of those critical skills.  “…the types of skills increasingly in favor are strong communication, empathy, collaboration, and trust building.” (Boris Groysberg, March 2011)

The following three blogs will describe the detailed method of how to think, behave, and improve trust in an organization.  Stay tuned.

Boris Groysberg, L. K. (March 2011). The New Path To the C-Suite. Harvard Busienss Review.

Covey, S. M. (June 2007). The Business Case for Trust. CEO Magazine.

Wally Hauck, PhD has a cure for the “deadly disease” known as the typical performance appraisal.  Wally holds a doctorate in organizational leadership from Warren National University, a Master of Business Administration in finance from Iona College, and a bachelor’s degree in philosophy from the University of Pennsylvania.   Wally is a Certified Speaking Professional or CSP.  Wally has a passion for helping leaders let go of the old and embrace new thinking to improve leadership skills, employee engagement, and performance.