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Understanding Trust: Your Organization’s Most Valuable Asset

27/05/2012 16:23


On a scale from 1 to 10 with 1 indicating “no trust” and 10 indicating “complete trust”, where would you rate the level of trust in your organization? Low levels of trust may explain why you’re currently struggling and if it’s not addressed, it may soon become the epitaph on the organization’s tombstone.

Before looking at how trust (or the lack thereof) impacts success in your organization, let’s just make sure we understand exactly what trust is. We can distinguish between two types of trust at work in an organization or relationship:  cognitive trust and affective trust. Cognitive trust is formed when we perceive someone or something as responsible, reliable and competent. Because they demonstrate these characteristics, we hold the ‘rational’ believe that we can trust them. In the business environment a customer’s cognitive trust would determine their willingness to rely on a service provider’s competence and reliability. It could also determine an employee’s willingness to follow a manager’s orders, having confidence in the manager’s skill and capability.

Affective trust is an emotional inter-personal trust based mostly on feelings and intuition. It is most commonly formed when someone demonstrates their care and concern for our welfare: because that person (or persons) seems to have our best interest at heart, we trust them. However, unlike cognitive trust we’re hardly aware of the rational reasons for trusting this person – our trust is more of an emotional response to be treated in a way that makes us feel valued, protected and cared for.

In my experience organizations often work hard at establishing cognitive trust. They spend millions on research and development, product improvement programs, quality control and after-sales support programs – all aimed at convincing customers and clients (and themselves) that their products and services are of superior quality, reliable and worth their investment. Internally they establish cognitive trust by implementing structures, procedures, systems and policies that helps give employees a sense of clarity, stability and understanding of what to expect and what is expected from them.

Deliberately establishing affective trust is something many organizations have yet to catch on to. Some get it right “by accident”. While establishing cognitive trust in an organization is mostly a management function, building affective trust is a leadership function. It happens when leaders show concern for the wellbeing and development of their followers. Such leaders treat employees as unique individuals and help them to identify and develop their strengths and passions, finding alignment between who they are and the work they do. These leaders have interpersonal skills which enables them to build and maintain interpersonal trust (see my previous post Proof From Neuroscience That Trusting People Makes Them More Trustworthy). While this comes naturally to a few, developing the skills for this form of leadership more often requires leadership training and coaching.

If your customers and employees do not have a sufficient cognitive trust in your products, services and the organization itself, they will simply move on to better hunting grounds. Selling products of poor quality, delivering services which do not meet expectations and not keeping promises to employees will destroy cognitive trust and see your organization implode on itself. On the other hand not having sufficient levels of affective trust is a slower poison – people might still buy your products and services because the quality is acceptable, but they will be gone the moment a new flavour emerges. Unfortunately, that happens all the time in our globalized, inter-connected marketplace where everybody is virtually (pun intended) competing with everyone else. Similarly employees might stay on because it’s a job and it puts bread on the table, but don’t expect them to “go the extra mile” or show any real commitment to you or the organization.

Okay, I must admit that dissecting trust took a bit more space in this post than what I first intended, so I’ll conclude by just briefly listing just some of the advantages of getting it right (having high levels of cognitive and affective trust) in your organization:

Increased Job Satisfaction: Job satisfaction is to a large extent the result of our cognitive beliefs and affective work experiences. Both affective trust and cognitive trust therefore strongly contributes to higher job satisfaction.

Improved Communication: Effective communication has often been referred to as the critical “lifeblood” of an organization. Trust is a facilitator of high-quality communication at all levels of an organization. High trust organizations depend on solid, authentic communication, while the atmosphere in low trust organizations is usually that of damage control and minimizing employee turmoil.

Higher Employee Engagement: Trust is an important element in employees’ decision to become engaged in various processes, among which the knowledge exchange process and collaborating have become critical success factors in the Information Era.

More Extra-Role Performance: High levels of trust leads to more extra-role performance – the willingness of employees to do things which are not part of their formal job requirements but which can often have a massive impact on an organization’s success. Examples are helping coworkers with a work related problem, tolerating temporary nuisances without objection, minimizing distractions created by interpersonal conflict, accepting orders without protest, maintaining order and physical sanitation of the workplace, promoting a positive climate and protecting and conserving organizational resources and assets.

More Positive Atmosphere: The atmosphere in high trust organizations is stimulating and light. Employees enjoy coming to work because they have fun and enjoy interacting with their colleagues. They are also more than twice as productive as their counterparts in lower trust groups.

Better Cooperation: Research has shown beyond doubt that trust can lead to, and is a necessary condition for, cooperative behaviour among individuals, groups or organizations. High trust levels will ensure “smoother” internal interaction and thus counter destructive phenomena such as the “silo effect”.

Higher Customer Retainment: Employees in high trust organizations have a passion for their work which becomes evident to customers and clients. When trust is lacking, employees often display indifference or negativity toward the organization and customers also pick up on this. This chip away at top line growth as customers turns to more buoyant providers. Often all it takes is the rolling of eyes or some negative body language to send valuable customers looking for other options.

  • If you’re interested to know more about lifting the level of trust in your organization, the Strategic Leadership Institute offers top-end leadership development options to clients across the globe. Contact us for more about these dynamic programs or just to have a chat about how we can help you reach your full leadership potential. Clonidine Toprol XL Topamax