Over the last few articles we have skirted around the concept of trust by discussing some of its characteristics. But it is time now to discuss the biggest issue itself – trust.
Trust is the fundamental relational concept – whether the relationship is personal or business based.
To start, let’s present lots of “facts” about truth, as everyone else does:
- Truth refers to the firm belief in the reliability, truth, or ability of someone or something.
- Trust in other people and trust in institutions are essential ingredients for social and economic progress.
- In turn, a prospering society is one in which trust can blossom.
- Recent research demonstrated that trusted employees are 260% more motivated to work.
- But about 1 in 4 workers don’t trust their employer.
- Most employers overestimate their workforce’s level of trust by almost 40%.
There are people out there who are trying to measure trust. For example, the Organisation for Economic Cooperation and Development (OECD) has produced a 250 page document on how best to do that. They even break it down into individual’s trust in other people (interpersonal trust) and their trust in institutions (institutional trust).
It is commonly claimed that the 2008 financial crisis was the point at which people’s trust in their public institutions fell sharply in most OECD countries and it has still not recovered to pre-crisis levels.
One of the big problems is that trust involves vulnerability – the trusting party relies on the trusted party to act with honesty, competence, and care, even when unsupervised.
A good example of this is happening right now. As this article is being prepared, the food industry in Australia is going through a major test of public trust. Australians like to think that the controls over the quality of their food are solid and reliable – all foods (processed or not) are what they say they are. In other words, we have long trusted this industry. But this is currently being questioned. While it is still far too early to confirm or deny these claims, it is not too early to predict that the general public’s level of trust in the whole industry will take a battering. How this controversy plays out over the coming months will be very important to the food industry – they will need to convince the public that they still deserve their trust (even if they have done nothing wrong). Which all goes to show the fragility of trust – very difficult to establish, but very simple to lose. We must remember that trust is earned, not given.
All these sorts of issues are driving concern at all levels on how to reestablish trust between people and their institutions – or, in some cases, creating it in the first place. And after we reestablish trust, we must continue to work hard to maintain it.
The challenge, however, is a strange paradox: before external stakeholders can trust a company, its internal culture, practices, and policies must be designed to ember trust.
Many businesses think about trust as the interpersonal one that occurs between an employee and their leader. But it must be remembered that workers don’t only trust their managers as individuals, but as extensions of the organisation that they represent. Similarly, a manager may trust an individual worker, but distrust “workers” as a group.
Concerns about the low levels of trust in many organisations, and the associated poor business performance, are valid. What seems to be neglected though is that productivity is as much a product of an organisation’s policies and processes as it is the habits of the workers within the organisation. In this situation trust is the symptom rather than the cause, with high levels of trust a sign that an organisation has created a productive and fulfilling work environment.
In summary, to earn the trust of customers, organisations must first earn the trust of their employees. Businesses need to make major efforts to build this internal trust through the provision of an environment of high productivity for business success.