The Question of Trust

The Question of Trust

Trustworthiness is at an all-time low; businesses need to generate trust among employees and management teams, particularly within larger companies.

The 2017 Edelman Trust Barometer made for depressing reading. From government leaders to the mass media to CEOs, credibility dropped across the board – with the latter category dipping to an all-time low of 37%, plummeting in every country studied.

Of course, the findings shouldn’t come as much of a surprise. 2016 witnessed some seismic changes to the traditional status quo – most notably with the outcomes of the EU referendum and the US presidential election.

“The Brexit vote reflected a breakdown of trust in politicians, businesses and other institutions,” says Ann Francke, chief executive of the Chartered Management Institute (CMI). “Rebuilding it isn’t just a requirement of our political leadership, it’s a profound management challenge for the nation.”

CMI findings from last autumn highlighted that just one in three (36%) middle managers said they fully trust their senior leaders, with four in five middle managers believing that staff lacked full trust in their CEO.

“These findings are a warning that communication breakdown between leaders, middle managers and employees is undermining growth,” adds Francke. “Leaders have to recognise the pivotal role played by middle managers at the heart of their organisations and support them to succeed in the months and years ahead.”

Arresting the slide

Trustworthiness in business leaders has gradually dwindled this century, with the most recent Edelman report revealing the lowest figures since the survey started in 2000, showing that this is most definitely a long-term issue. But how do you stop the bleeding, so to speak?

“The formula for trust has three components: ability, integrity and benevolence,” says John Blakey, CEO coach and author of The Trusted Executive. “But the way the formula works is that the three aspects are not simply added together, but multiplied.

“Therefore, the implication is that if you score zero – or lowly – in one of the components, it’s difficult to generate trust. On the other hand, if you can be in the top quartile in all three of those pillars, then the multiplier effect means you can build a competitive advantage out of trust. If you are noticeably weaker in one aspect – for example, supermarkets took a hit to integrity in the wake of the horsemeat scandal – then you should, in the first instance, look for opportunities within the other two sectors to rebuild your trustworthiness.”

Blakey discusses how the role of benevolence has recently taken on an even greater importance, with businesses realising that the old mantra of simply chasing profit is no longer adequate in today’s society: “Business leaders are re-evaluating the purpose of their companies. If you came into business in the ’80s, it was all ‘profit, profit, profit’, but now we’re seeing that shift as they embrace what’s known as the ‘triple bottom line’ – towards profit, people and planet.”

“Leaders have to recognise the pivotal role played by middle managers at the heart of their organisations and support them to succeed in the months and years ahead”
Ann Francke, chief executive, Chartered Management Institute

He cites Unilever and its CEO, Paul Polman, as a prime example – a business that has embraced change and adapted its mindset, and witnessed even greater profits in doing so.

“He’s a great case study for future leaders,” Blakey says. “We need to find, nourish and nurture the next generation of Paul Polmans; it’s the type of leadership that will regain trust.”

Kindness is the most crucial aspect of benevolence, adds Blakey, because it’s not a trait that can be institutionalised; it has to come from the heart. As with Unilever, it is organisations that create cultures of trust and kindness that will witness a huge impact in terms of their trust. “If you can show you have the human touch – compassion, care and kindness – that’s what triggers this pillar of benevolence,” adds Blakey.

“Go the extra mile and deliver the wow factor,” he concludes succinctly.

Bigger is not better

A 2014 report by the Institute of Leadership and Management (ILM) also highlighted that the larger a company is, the more likely it is to suffer from a lack of CEO trust, mainly due to the increased level of middle management and red tape. ‘The truth about trust: Honesty and integrity at work’ revealed: “Employees in the largest organisations typically [report] lower levels of trust. Those working in the smallest organisations of under 50 employees, where managers and senior staff are more likely to be in direct contact, displayed the highest level of trust across the group – 58% net high trust in their organisation. This group also displayed the highest levels of trust in their managers and colleagues.”

Meanwhile, very large firms (of over 1,000 employees) had lower levels of trust, with only 27% of managers saying they had high net levels of trust.

Strike while the iron’s hot

As Francke suggested, the world is seeing a significant amount of change occurring at the moment. Although it is a volatile situation, the fragile state of affairs means that businesses can really take advantage and improve their trust levels by rising above the turmoil.

“This will be a period of exceptional dynamism and change in the UK economy,” says Patrick Woodman, CMI’s head of external affairs. “Every organisation must be equipped to harness this change, rather than reject or hide from it. That requires its people to trust each other.”

The good news, adds Francke, is that trust can be cultivated, through good management and leadership at all levels. It means open and honest communication, but also giving managers the training and development to be confident.

“Development paths such as management training, accreditation and leadership events have an important role in building trust in an organisation,” he says. “They demonstrate interest and concern for developing the skills of individuals and providing progression routes across the organisation. They are a visible commitment to develop the competence of managers and can often be a sign of faith in a particular individual.”

By Blayne Pereira from ContentLive

 

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