Why Trust is Critical to the Success of Your Business

Every business wants their employees to be more productive, more motivated and have their best employees stay in the business longer. Unfortunately, most CEO’s struggle to achieve this. I have commented a number of times on the low employee engagement scores here in Australia. One of the issues with low engagement is that employees will leave you without too much hesitation, particularly the higher performers as they are not getting what they want and need.

I came across an excellent Harvard Business Review article written by Paul Zak, who is a professor of economics, psychology, and management at Claremont Graduate University. In the article, Zak described how he and his team delved into the topic of why humans trust (or don’t trust) others. His research came up with some fascinating insights that will help improve the performance of employees through increasing the level of trust in an organisation.

Let’s start off with the bad news – in a 2016 global CEO survey, PWC found that 55% of CEO’s think that a lack of trust is a threat to their organisations growth. Zak found that employees in high trust organisations have more energy, collaborate better with their colleagues and stay with the business longer. All the benefits we are wanting our employees to bring to work every day.

So how do you build trust with your employees? Is it simply a matter of shooting a drink on Friday night? Unfortunately, like happiness, you can’t buy it!! It has to be earnt, so here are some of Zak’s tips to better manage for trust:

  • Recognise excellence. Yes, this simple one yet again. Recognition has the largest effect on trust when it occurs immediately after a goal has been met, when it comes from peers and when it’s tangible, unexpected, personal and public. This reinforces our constant focus on catching people doing things right, and not focusing on what they are doing wrong.

  • Induce “challenge stress”. This is setting challenging yet achievable goals for individuals and teams. The key is goals need to be a stretch but still attainable so employees don’t give up too quickly. This is backed up by other research which found that 76% of people who were using a daily diary stated their best days were when they made progress against their goals.

  • Give people discretion in how they do their work. This is also a massive motivator for the younger generation who want more control over how they run their day. Zak found that once employees have been trained, allow them to manage people and execute projects in their own way. Being trusted to figure things out is a big motivator. A Citigroup and LinkedIn survey found that nearly half of employees would give up a 20% raise for greater control over how they work – that’s big!

  • Share information broadly. Only 40% of employees reported that they are well informed about their company’s goals, strategies, and tactics. Organisations that share their plans with employees reduce uncertainty about where they are headed and why. I have also spoken about this previously as a major motivator, employees want to know what the organisation is wanting to achieve and how they contribute.

  • Intentionally build relationships. Zak’s experiments showed that when people intentionally built social ties at work their performance improves. Being part of a team and having strong working relationships has often come out as a big motivator as why people go to work in the first place. A Google study found that managers who express interest in and concern for team member’s success and personal well-being outperformed others in the quality and quantity of their work.

  • Facilitate whole person growth. High trust workplaces help people develop personally as well as professionally. It’s not just about acquiring new work skills, it’s helping employees grow as human beings.

  • Show vulnerability. Leaders in high trust workplaces ask for help from colleagues instead of just telling them what to do. Asking for help is a sign of a secure leader, one who engages everyone to reach goals.

In summary, trust is cultivated by setting a clear direction, communicating this clearly, giving people what they need to be successful and getting out of their way! It’s not about going easy on your employees or expecting less, high trust organisations hold people accountable without micromanaging. They treat their people like responsible adults.

Thanks, Paul Zak for your great article, full of helpful information.

Roger Simpson – CEO, The Retail Solution and Author of “The Retail Solution” With over 35 years’ industry experience, Roger Simpson is recognized as Australia’s #1 Authority on customer ROI in the retail industry and as a global expert on staff coaching, customer service, and selling skills.