Firms that build trust are reaping the rewards
Published 01/08/2013 | 05:00
Never in our history has the concept of trust been more connected to success from an economic perspective. Previously it was a plus if you managed to achieve a trusted status in the minds of your customers. However, with the explosion of internet trading, the expansion of cloud computing and the collapse of institutional confidence, organisations that can create a business built on trusted relationships, both from clients' and employee perspectives, will outperform their competitors and lead the way to business success.
Trust has always been an important feature of every economy. In fact, our whole monetary system is based on trust and a promise to pay. So, it is probably surprising that so many business people have played fast and loose with such an important currency.
We are living in a society that is bruised and broken from the many organisations that have failed the trust test. We have even lost trust in the food we eat following the recent horse-meat scandal. It is refreshing to see certain organisations bucking the trend, and the good thing about trust is that it is relatively easy to build.
Authenticity is the real key.
While your website may proclaim a wonderful business with integrity to the core, social media may tell a different story.
It is no longer possible to control the information flow from your organisation and if your people are disgruntled, they can tell the world.
Organisations are keenly aware of the need to build high levels of trust throughout their business. They realise that the days of spin are dead.
Being upfront and honest is the starting point of rebuilding the emotional contact with their people. Business leaders who hide problems fuel rumour mills; whereas those that share the issues receive a welcome trust dividend – adopting a collaborative approach can lead to innovative solutions.
This was witnessed by cloud computing giant EMC in 2008 when it opened up to employees about business challenges and experienced an increase in trust levels while reducing salaries.
The decision was one agreed in collaboration with the same staff members who transformed the business from a one-product company, to a multi-product manufacture.
Hidden agendas, politicking and backstabbing are now being replaced by open systems where employees are encouraged to question everything. Finnish company Futrice is a perfect example.
Frustrated that bureaucracy was slowing the business down and that too much time was being wasted checking expenses, it was decided to abolish the checks. Instead, it published everybody's credit card bills on the company's intranet, asking only that everyone be willing to explain their expenditure to anybody who inquired.
The intranet is also the place where you will find all employee/director salaries, including the CEO's, with board and management meeting minutes published and only a small number of confidential items withheld.
Certain leaders are more comfortable hiding away, not wishing to be asked a difficult question. Trust-building leaders know the power of contact. Accessibility is the hallmark of trustworthy leaders. They want to hear first-hand the issues that are facing employees and to connect directly with customers.
They are not afraid to simply say that they don't know the answer when stumped by a question.
This expression of vulnerability is appreciated by employees and customers alike, who reciprocate with a new degree of openness and expression that, in turn, can lead to breakthrough relationships.
The trust dividend was probably never better articulated than through a piece of research at Kimberly Clark, makers of global healthcare cleaning products like Kleenex, Huggies and Kotex, which has 58,000 employees across 37 countries.
The company completed a correlation study which assessed a movement in the level of trust experienced by employees and the profit achieved by the organisation. It discovered that for every positive 1pc movement in trust, it achieved a $3m profit rise.
In a world where work is a thing you do rather than a place you go, where managers can't control where work is done, trust is the critical currency. For those who embrace it, it can lead to a very profitable future.
John Ryan is CEO of Great Place To Work (www.greatplacetowork.ie) an organisation dedicated to helping companies build success through high levels of trust.