What are some of the consequences of not trusting people? Taxes vs. Dividends.

“A nation’s well being, as well as it’s ability to compete, is conditional by a single, pervasive cultural characteristic: the level of trust inherent in the society. - Francis Fukuyama. Well let’s start with some broad data from 2018 when according to this survey of people in the US only 32% tend to trust media, only 18% trust the government and only 21% trust big companies. In terms of people trusting other people, in the US only 31% of Americans believe that other people can be trusted which is down from 48% three decades ago. At the organizational level the news doesn’t get any better. Only 45% of employees have trust and confidence in senior management. Only 18% of people believe business leaders tell them the truth (13% for government leaders.)

At the personal level we still have some challenges. The number one reason people leave their jobs is a bad relationship with their boss and one out every two marriages ends in divorce.

In some of the literature that I have read and based on my experience trust always affects two outcomes - speed and cost. When trust goes down, speed will also go down and costs will go up. And vice versa, when trust goes up, speed will also go up and costs will go down.

A real world example, I worked for this CEO of a medium-sized organziation who firmly believed in this command and control approach to management. The turnover rate had increased over several years to 20-25%. When you dug into those numbers to identify some of the root causes you got comments like, “micromanaging made me leave,” “tell me what you expect of me because it is always a moving target” and “I don’t trust anyone in management.” I proposed an entirely new management approach and style to the organization. There were some broad strategies around this approach that began to create a new dynamic within the organization and over time we began to see the reduction in turnover, more engaged employees, increased productivity and costs were reduced in a whole variety of unexpected ways.

Here are some differences between low trust and high trust organizatons and the "taxes" and "dividends" associated.

The Trust Continuum - Where do you start?

Where are you on the trust continuum when you meet new people or join a new organization? What informs your decision as to where to start on the continuum? On one end of the continuum is distrust and on the other end is blind trust. Neither one seems to be a good starting place but we have to begin somewhere.

By extending trust you are placing yourself in a high-risk situation that could have significant negative consequences. On the other hand, beginning the process of trusting someone could have significant ROI and pay serious dividends. How do you then avoid the failure of trusting someone but ensure the positive outcomes associated with a highly trusting relationship?

In my experience, I try to balance my own past experience (good+bad) with people and organizations against things that I can analyze and then validate. The mistake that I have made in the past is that I have made some dangerous assumptions about who the person was, what their values were, and not understanding what was motivating them. How can you appropriately analyze and validate these things when meeting new people/partners or joining a new organization? I typically will do background checks and interview all of their team members before making a decision. I’m Joking!!!

Let’s start with some good questions:

1. What is the opportunity (situation or job to be done)?

2. What is the risk involved? - What are the possible outcomes? - What is the likelihood of the outcomes? - What is the importance and visibility of the outcomes?

3. What is the credibility of the people involved?

If you could get these answers in the early stages of a new relationship do you think you could move further on the continuum toward trust or reducing risk?

Trust: Myth vs. Reality

Let’s say you are an executive joining a new Board of Directors or Management team. How do you go about building their trust? What are some myths vs reality that would help you to understand as you go about the process of building their trust.