Reality Check: Do You Know the Impact of Trust?
Ways to consider the trust-effect
Posted October 31, 2012
Maybe you've seen the Cornell research that found hotels with managers whose actions matched their words (a.k.a. behavioral integrity) were more profitable; or the Canadian retail study where customer service, staff performance, and sales were found to be higher in stores where employees' felt trusted.
Maybe you've seen findings linking higher financial performance with employee engagement, punctuated by Gallup research identifying the chances of employees being engaged when don't trust their leaders as one in twelve, versus one in two when they do.
Or maybe you've read Amy Lyman's work on the 100 Best Companies to work for which concludes, "Companies whose employees praise the high levels of trust in their workplace are, in fact, among the highest performers, beating the average annualized returns of the S&P 500 by a factor of three."
These studies all touch on elements of trust's impact at work. But there are many more ways to see its results. How can you quantify the impact of workplace trust? Here are a few ways:
- Greater profitability
- Higher return on shareholder investment
- Decreased turnover of top performers
- Increased employee engagement
- Heightened customer service
- Expanded staff well-being
- Less likelihood of unionization
- More collaboration and teamwork
- Better relationships
- Higher productivity
- Enhanced creativity and innovation
- All of the above and much more
Yet despite these positive effects trust brings, there's an often ignored reality challenging many organizations' results. Chris Hitch, Program Director at the University of North Carolina at Chapel Hill's Kenan-Flagler Business School, in the white paper How to Build Trust in an Organization, captures that reality this way, "Unfortunately, many senior leaders cannot seem to shake the top-down model of management that adheres to the notion that authority creates trust. In reality, trust creates authority."
Consider the problems that face your organization or work group. Now look deeper. How many are trust related? How much is distrust costing?
Want to attract and retain top performers? Enhance innovation? Increase service, engagement, productivity, and results? Then consider this reality – creating a winning culture founded on trust and communication is not an HR "nice" to do, but in this post-recession era it's a strategic imperative. Bottom line: trust creates, builds, and sustains organizational results.
Below are a few trust building tips:
Want more? Download the complimentary first chapter of my new book, The Titleless Leader – "Operating with Trust."