One of the benefits of being a TJ subscriber is full access to our decades-long archive of content – here we look back to a piece that discusses trust from July 2013.

Is it the biggest bottom-line deal-breaker? asks Ken Blanchard.

In whom or what do we trust? Perhaps it is easier to say what we do not have faith in. Politicians are definitely off the trust agenda: a recent Ipsos MORI poll showed the British public trust politicians to tell the truth less than estate agents, bankers and journalists¹. Since the shocking discovery that many popular beef products contained traces of horsemeat, food producers have come under fire, and the latest research by Consumer Intelligence reveals 67 per cent of us no longer trust food labels as much as we once did². Even that great British institution, the NHS, is becoming increasingly untrustworthy if its own doctors and nurses are to be believed: an internal NHS survey of more than 100,000 staff working at more than 259 NHS organisations across England found that, in some parts of the country, almost 40 per cent of NHS staff said they could not recommend the treatment available in their hospitals to their friends and family³.

Given this apparent national decline in trust, perhaps it should come as no surprise that lack of trust is rife in our workplaces too. Yes, we all know in theory that trust is important – most of us would argue we are trustworthy – yet, every time we ask the question, we find only 20 per cent of employees fully trust the organisations they work for and only 11 per cent believe their managers show consistency between their words and their actions⁴.

We recently hosted a webinar on the subject of trust, during which we took a straw poll of the more than 1,000 people who attended. They confirmed these shocking figures and worse. Sixty eight per cent had been the victims of rumours and gossip, and 47 per cent acknowledged that secrecy and hidden agendas were alive and kicking within their organisations. Dishonesty or spin were familiar to 34 per cent of participants; arrogance or aloofness resonated with 38 per cent, and 58 per cent reported lack of open communications and collaboration. Taking all that into consideration, it was perhaps surprising that only 52 per cent believed their organisations had suffered as a result of low employee engagement or commitment. Some businesses seem to be getting off lightly!

It appears indisputable that all these trust-busting behaviours are common practice. More than 50 per cent of the people in our online poll had left an organisation because of them; that’s over half of our workforces ditching their jobs because they don’t respect, or have faith in, their managers, colleagues, board members, whoever. Yet the people who ‘forced them out’ probably didn’t even realise there was a problem. Either that or they minimised the issue with comments such as ‘well I’m the boss’, or ‘you didn’t need to know’, or ‘just get on with the job you’re paid to do, or ‘we didn’t break the rules, just bent them a little’.

Organisations tend to ignore trust, paying attention to this crucial issue only when it has been broken, when it has gone, when their best people walk out of the door. Perhaps they only really start to take notice when they begin to reap the financial downsides – not least of having to source new employees. Ernst & Young, for instance, estimates that the cost of losing and replacing an employee may be as high as 150 per cent of the departing employee’s annual salary (including the manager’s time spent training new employees)⁵. When trust-busting behaviour initiates that kind of financial hardship, it is behaviour that needs addressing, fast.

Of course, lack of trust is not just counterproductive in terms of employee turnover. It is also liable to prevent, or at least hinder, success. [pullquote]I believe trust is essential for harnessing people’s energy and passion[/pullquote]. I believe it is the key to exceptional performance and builds the conditions for transparency, two-way communication, high involvement and disclosure within our workplaces – all critical factors if we are to develop high-performing organisations with high levels of employee motivation, and high profit margins.

The benefits of organisational vitality, employee passion and customer devotion cannot be underestimated, in my opinion, and at least two studies I know of bear me out. A study by the Atlantic Consulting Group, for instance, showed how, in a trusting environment, people are much more productive and their organisations much more profitable⁶. Its research was able to demonstrate a direct correlation between trust and profitability, with 84 per cent of people in divisions that outperformed others having high levels of trust as opposed to just 27 per cent in lower-performing divisions.

A further study by the Great Places to Work Institute, which publishes the Fortune 100 Best Companies to Work for list, showed that, between 1997 and 2011, high-trust companies outperformed others by at least 6.3 per cent and provided four times the returns as market average for comparative low-trust companies⁷. They also typically experienced a 50 per cent lower turnover rate.

Organisations are increasingly cottoning on to this and recognising the need to take proactive steps to put high-trust cultures at the heart of their organisations. In the US, Canada and Mexico, we have been working with home improvement retailer Lowe’s to build trust and engagement; the company has incorporated our Trust Works! model into its leadership development programmes. Lowe’s employs nearly 235,000 people in more than 1,750 stores and has found that, in teams or stores where there is a high level of trust and engagement, people costs around accidents, turnover, sick hours and inventory shrink are lower and customer satisfaction is higher, as are sales and profits. Conversely, in stores or teams that have a lack of trust, the engagement results are lower and the people costs are up.

Trust is easily broken, while rebuilding it is difficult, not least because we all have different ideas of what trust looks like, depending on the behaviours of those with whom we are in a relationship.

In our online poll, we also asked: which of the following do you think is most important in building and maintaining trust:

• getting high-quality results
• being honest in word and deed
• sharing information to ensure everyone is on the same page
• following through on what you say you will do – dependability?

The clear winner, with 52 per cent of the vote, was being honest in word and deed. Following through on doing what you say you’re going to do came second, with 35 per cent. Sharing information polled at 12 per cent. Getting high-quality results got no votes at all; a straight 0 per cent. Yet what do most companies rank their employees on? Yes, results. And, in my experience, that speaks volumes as it is often the companies that value results at the expense of anything else that have the lowest levels of trust and are ultimately most likely to fail in the long term, however good their short-term results.

This is not to write off the need for results, not at all. Results, after all, are what we are in business for and we forget to include results in our list of trustworthy behaviours at our peril; who trusts a leader who cannot deliver the goods? It is just to say that we must remember that, for the vast majority of people, other factors rate far higher than results when it comes to perceiving ‘trustability’.

When trust is gone, how do we recapture it? How do we shake up our work environments and get them back to being places where we can trust each other again?

First, we need to encourage leaders to work in the best interests of their whole organisations, not just for themselves. While the bad news is – as we all know – that trust can be very easily broken, the good news is that trust can be nurtured, if not quite as swiftly as it can be depleted. How a leader behaves can change people’s willingness to trust him. This doesn’t just mean making the right technical or financial decisions, but inspiring people to engage fully in the common good. It means showing people what trust looks like as well as talking about it.

Ask yourself how regularly you practise the following trust-building behaviours:

• give credit for good work
• listen to your people
• ask for input from your people
• show concern and interest in their work
• share information (including confidential information) with your people
• give feedback in a caring and constructive way
• lavish people with praise and recognition
• provide opportunities for growth and skill development.

Leaders also need to recognise trust-busting behaviours when they see and experience them, and make sure they do not get involved in spreading them around. Ask yourself honestly whether you are inadvertently helping to fuel a low-trust environment by engaging in any of the following trust-busters. Do you eve:

• fail to demonstrate expertise or achieve results
• break confidences, lie and gossip
• neglect to listen to others, enjoy their company or show interest in them
• not bother to give recognition or rewards
• ignore the need to follow through
• let yourself become unorganised or unreliable?

Trust must be rebuilt if these behaviours have become commonplace. Our Trust Works! model can be used to help rebuild trust, assess what happened and why, discuss the situation and create a plan to change trust-busting into trust-boosting behaviours. It can also, of course, be used to ensure trust is not broken in the first place.

Although a great fan of acronyms, I kept Trust Works! simple – it is an ‘ABCD’ model that gives a common understanding of what trust is and a framework for talking about it. From this you can build and sustain solid relationships to reap the benefits of organisational vitality, employee passion and customer devotion.

A – Able

To win trust, competence needs to be prized within workplaces. Who trusts those who don’t have the skills or expertise to meet their goals? Consistently achieving goals and having a track record of success builds trust through inspiration – it inspires confidence. Able leaders also facilitate work effectively, developing credible project plans, systems and processes to help team members achieve their goals.

You become able by having a well-stated mission and a common vision, setting clear goals and expectations, delivering proper training and ensuring results are achieved.

B – Believability

Integrity is the key word here. It’s about being honest, showing values and acting fairly. A believable leader deals with people honestly by keeping promises, not lying or stretching the truth, not gossiping. They articulate their values and walk their talk, and treat people fairly and equitably – no favouritism and no scapegoating, just treating people appropriately and justly based on the individual situation.

You become believable by having common values that are shared and used in decision-making, being open and truthful with information, admitting your own or organisational mistakes, having clear policies and practices, and being ethical and fair.

C – Connected

This is about care about others – not for them, but about them. Being people-focused, communicating, recognising good work – these are some of the best motivational tools there are. Connectedness with leader and connectedness with colleagues are two key factors involved in creating employee work passion, and trust underpins this. Build rapport by taking an interest in team members and recognising their contributions to build trust and goodwill.

You become connected by being transparent, sharing data on the company, results and yourself, giving and finding answers and taking an interest in people.

D – Dependable

Maintaining reliability is important, as is being responsive, accountable and organised. [pullquote]One of the quickest ways to erode trust is by not following through on commitments[/pullquote]; that is a sure-fire way to earn a reputation as being unreliable, untrustworthy and inconsistent.

You become dependable by doing what you say you’re going to do, keeping time commitments, starting and ending meetings on time, holding yourself accountable for your actions, keeping an accurate calendar.

Leaders can afford many kinds of mistakes, but the one thing they cannot afford to lose is trust. The ability to build and sustain high levels of personal and organisational trust is a defining and critical competency for today’s leaders. By using behaviours that align with the four core elements of trust – able, believable, connected and dependable – leaders can build trust effectively and lead their teams to higher levels of productivity, engagement and success.

A fully-referenced version of this article is available on request