What do the disbarment of North Carolina prosecutor Mike Nifong stemming from the Duke lacrosse case and passage of the Sarbanes-Oxley Act have in common? They both resulted from events in which leaders did not model trust.
At a recent seminar on organizational greatness, speakers focused time and again on the need for leaders to create and model a culture of trust as the foundation for sustaining a great enterprise.
This seems like a simple concept. But, like many powerful ideas, it can have a profound impact when it is taken seriously and applied with consistency.
In business relationships, as in life, trust begins with our personal character. If you can’t be trusted in your personal relationships, it’s doubtful that you will be considered trustworthy in the relationships that are necessary to keep your organization functioning well.
In his Harvard Business Review article “Decision to Trust,” Robert F. Hurley notes that roughly half of all managers surveyed indicated they didn’t trust their own leaders. What does this level of distrust cost those operations?
Business guru Peter Drucker has made the point that organizations in the modern era are no longer built on force, but primarily on trust.
The degree of trust that exists within an organization is tightly linked to the ability of that organization to execute its mission quickly while controlling its costs. This suggests that an organization’s tolerance for distrust is expensive to the overall operation and even threatens its sustainability.
In his book “The Speed of Trust,” Stephen M.R. Covey describes the “economics of trust” this way: a high-trust business environment yields a higher speed (ability to execute), resulting in lower-cost operation.
Compare that to a low-trust environment, which results in a lower speed (inability to execute) and higher-cost operation. In this light, building a culture of trust becomes a true competitive advantage.
Of course, trust is not something that can be extended without warrant. We don’t extend trust to our managers without some condition or qualification of competence. Clearly there must be a balance.
But if trust truly pays the kinds of dividends that Covey and others believe, managers should view trust as a key strategy in creating a better organization.
Abraham Lincoln said that he would rather trust people and be disappointed some of the time than distrust everybody and be miserable all of the time.
As organizational leaders, we must consciously choose whether we will lead from a platform of trust. We must model this behavior and eliminate relationships and dynamics within our organizations that are not based of trustfulness and transparency.
If we don’t, we allow distrust to dominate and we may incur the high costs that accrue when there is no culture of trust.
The decision is really one of being able to execute in our new global marketplace. As leaders, we might consider asking ourselves two questions: What is the cost of the distrust and suspicion existing in our organizations? More importantly, as leaders, what are we going to do about it?
Todd Oldham is the interim dean of workforce development and continuing education and the director of corporate education at Clark College. He can be reached at 360-992-2356 or customizedtraining@clark.edu, or visit web.clark.edu/conted/customized_training/about.html for more information.
