Building Trust…A Key to Success

A lack of trust is devastating in any organization. Whether it’s a business, a nonprofit or a church, the dynamics are similar. If people don’t share information or don’t cooperate they lose trust. While the issue is easy enough to resolve, left unattended it can ruin an organization.

Trust is Essential to Cooperation, Engagement and Profit

Consider the case of a small telecommunications company that asked us for help shortly after I started my fundraising consulting business. They were having trouble motivating workers to go the extra mile and produce quality work. Competition was increasing and profits quickly declined, so the owners brought in a new CEO and management team to turn things around. Both the industry and their company had experienced great change in the late 90’s. The new leaders needed to engage the workers, but they resisted all efforts. Regardless of what they did, they couldn’t get people to cooperate and assume ownership for their work.

As we interviewed workers, we found that the former management team refused to share crucial information about the company and its financial health. Essentially, they kept workers in the dark and tried to drive them to higher levels of productivity. They took a legalistic approach with workers…one that was inflexible, unforgiving and rife with mistrust. In the absence of information, workers were left to make assumptions about the company and management team. They assumed managers really didn’t care about the company or its mission; they simply drove workers to produce for their own benefit. Needless to say their credibility diminished, profits declined and trust diminished to the point where people stopped cooperating with each other.

Trust is a Leadership Issue

That’s true in any organization. If people can’t trust each other, it’s just a matter of time before productivity and profitability deteriorate. At this firm, it took the new CEO months of hard work and information sharing to begin regaining the trust of workers. Trust is always a leadership issue because leaders are the ones responsible for creating the culture. No doubt, when leaders fail, it’s often because of their inability to engender trust. Hoarding information and ignoring questions tells people they’re not respected or they can’t be trusted, or both. Cooperative and productive relationships simply can’t develop if trust and respect are missing.

On a larger scale the same thing is true of society. In his best-selling book, Trust, social philosopher, Frances Fukuyama, compared “high trust societies” with “low trust societies.” He demonstrated how trust gives American business a strategic advantage that is absolutely critical to economic prosperity. When we work together towards common purposes in churches, nonprofit organizations and communities, we learn to trust people outside our families. That helps develop skills and attitudes that transfer into the workplace. In part, the free flow of information in America demonstrates that trust.

The converse is also true. Declining trust invites costly government intervention that businesses have experienced in the wake of scandals. When Enron, Facebook and Wells Fargo hide or even distort information credibility declines and customers and investors pay the price. That kind of activity also contributes to declining trust in society in general. For example, according to a recent Pew Research study only 45% of Americans believe most people can be trusted.

Finally, a recent Forbes article noted that important economic drivers include a carefully crafted brand, a cooperative culture and a talent pool that is well managed. That doesn’t happen apart from trust, and leaders are responsible for building and cultivating an environment of trust. The late Peter Drucker said it well:

“The final requirement of effective leadership is to earn trust. Otherwise, there won’t be any followers.”