Trust has been named the #1 competency for leaders in the new global economy. Why is this? What’s different now than a year or two ago to make something we usually take for granted in someone with good character the new skill that needs to be learnt?
Firstly, the nature of the global economy has shifted to collaborative and interconnected. Trust is the new currency of this collaborative, connected interdependent economy. It fuels the collaboration necessary to operate globally, and ensures relationships with people you don’t know well work. Trust is vital to organisations, governments, reputations, brands and individuals.
Secondly we are increasingly operating in a low trust world. Trust levels are going down everywhere – most institutions, most governments, in business, in marketing and advertising, in society generally. Research conducted in 2009 by Perceptive Insight for Sustainable Advantage showed that in New Zealand only 11% of customers trust businesses to be open and honest in their communications. And in previous research by Red Carpet 50% of employees trust their boss little or not at all and 85% of employees do not trust their organisation. This lack of trust is a real and measurable cost to business.
Thirdly the foundation of brand is trust. Customers will trust a brand that consistently delivers what is promised – or more. This means that the opportunity is huge for leaders and businesses that set about deliberately building themselves as trustworthy. High trust organisations have been shown to return up to 286% more in total return to shareholders. Deliberately setting about to build trust as a competency is a crucial strategic initiative that will deliver significant returns.
What do we mean by trust in the business setting? We mean confidence. We are confident in the intention and ability of the business to deliver the results they promise.
In a team environment when there is low trust we can observe any of the following behaviours:
• People manipulate or distort facts
• People withhold and hoard information
• People spin the truth to their advantage
• Getting the credit is very important
• New ideas are openly resisted and stifled
• Mistakes are covered up or covered over
• People are involved in a blame game, badmouthing others
• ;There is an abundance of “water cooler” talk
• There are numerous “meetings after the meetings”
• There are many “undiscussables”
• People tend to over-promise and under-deliver
• There are a lot of violated expectations for which people make many excuses
• Reality is often skirted and attention focussed on side issues
• The energy level is low
• People often feel unproductive tension—sometimes even fear
Each behaviour is a cost to the organisation which we can call a tax.
In the market, the costs of low trust are stated simply as:
- Customers go elsewhere and 67% of them are likely to tell friends and family to stop buying as well.
So how do we go about building trust as a competency in ourselves and our organisations?
We begin by assessing our credibility – both in our character and our competence. Credibility is the foundation. 4 key areas to assess are:
- What is our intention, have we declared it, do others understand it?
- What is our level of integrity?
- Do we have the capabilities?
- Do we deliver results?
And we follow by modelling the specific behaviours identified as building Trust.
