Charles Elvin, CEO of the ILM, claims that organisations perform most effectively when people operate in an environment of ‘trust’. Trust supports good leader-follower relationships. As a result of trusting relationships, people are able to collaborate effectively and feel ‘safe’.
Lydia agrees that a feeling of safety leads to lower levels of stress, which in turn allows managers to think more clearly and make better decisions.
What are the key drivers of trust in organisations? –
– Ability – capability and competence of staff; ability to do one’s own job well
– Understanding – having an understanding and knowledge about others
– Fairness – being fair with others and being treated fairly oneself; it is important here that employees’ perceptions support feelings of fairness, perceptions are reality
– Openness – allowing others to express ideas and opinions and be heard, even when you or senior managers do not necessarily agree
– Integrity – being honest, having values and adhering them to them
– Consistency – sticking to one’s values, acting predictably, even when the actions are not always popular
Charles implies that the last three are the most crucial. In today’s globalised world, people are often working together ‘virtually’ – they may rarely meet or even rarely speak to each other, rather relying on electronic forms of communication.
It is well known that people are social creatures and that our communication is most effective when we can see, hear and empathise with each other. Consequently, the most effective forms of communication are face to face. If relationship building is so crucial to creating trust, then paying attention to communications is highly critical. Not just what we say but how we say it!
Openness – recognises the importance of listening as well as the willingness to hear new ideas or suggestions.
As has often been said, we are blessed with two ears and one mouth – so our communication style should reflect this. However, managers in positions of power frequently operate in transmit mode and are sometimes reluctant to hear messages they find unpalatable. What happens when there are ‘rogue’ employees? Or whistleblowers? Are these messages heard with pleasure? What if they are not?
Integrity – When employees ‘bend the rules’ for short term or personal gains, what happens? The consequences are likely be affected by how long these behaviours go unchecked or how serious the impact is on customers, suppliers or society at large. An example is the fraud uncovered back in 2011 by the then CEO and subsequent whistleblower at Olympus, Michael Woodford. The board and senior management fired him – it was a message they did not want to hear. However, the allegations were then investigated by impartial third parties and eventually led to the uncovering of a serious and long-standing fraud, with resulting convictions. Would the fraud have taken place or been so damaging if senior people had been more willing to listen?
Consistency – If managers do not sustain their values and flip flop in response to external influences, people surrounding them are unsure of the responses they will get. This makes everyone uncertain. Employees do not know which behaviours or outcomes are acceptable or valued. If employees do not know, can they do their job effectively? If they are made to feel uncertain or uncomfortable, it is likely to reduce their ability to perform.
Then there is the impact of low trust on customers and society.
The reputation of organisations which are seen to take advantage of people or the environment will doubtless suffer. For instance, Nike was accused of “slave wages, forced overtime and arbitrary abuse” and therefore had to transform its image or fail. By creating a Corporate Social Responsibility committee, with equal standing at Board level to other committees, it succeeded in focusing attention on performance not compliance. A more resilient and sustainable business was developed as a result of the committee encouraging the board to take the long view — it acted as a balance to counter the myopia that can result from the pressure of short-term objectives and the relentless flow of matters demanding immediate attention.
Charles claims that organisations in which trust breaks down become dysfunctional. Ending on an optimistic note, he believes that trust can be built and restored. The Nike example shows that with hard work and systematic change over a period of years, reputations and trust can be rebuilt. This example shows that trust is not a given but rather needs sustained effort and attention and benefits from leadership with integrity which is focused on the short and long term performance of the business.
Senior Partner, The8group
Click here to see Charles Elvin’s webinar 19th March, 2015