Culture can’t be built without it
“Learning to trust is one of life’s most difficult tasks.” While these words were penned by hymn writer Isaac Watts in the 1700’s, they couldn’t be more relevant today. Trust is the cornerstone of healthy relationships, both in personal and professional settings. At work, trust serves as one of the foundational dimensions of a healthy culture. It is the antithesis of fear, which breeds disengagement, lack of loyalty, decreased effort, inability to own mistakes, decreased productivity, the list goes on and on. Any business leader in their right mind would want to avoid that list. But the numbers across the U.S. workforce seem to indicate that leaders may be missing the mark:
- ⅓ of employees don’t trust their employer.
- Disengagement costs U.S. companies $450 — $550 billion each year.
- 96% of engaged employees trust management vs. 46% of disengaged employees. [1]
When a third of employees in the country actively distrust their organization, on top of those who may have a middling level of trust, it becomes difficult for leaders to drive any positive initiatives on culture. Whether it is trying to drive engagement and mitigate the costs incurred when employees check out or simply attempts to increase productivity and tighten up margins, the jury is in on trust in the workplace. The verdict? There is work to be done.
How much does it really matter though? What impact can a leader expect if they are able to drive high levels of trust within their organization. The 22nd annual trust barometer by Edelman Data & Intelligence revealed that when compared to companies with low levels of trust, high-trust cultures enjoy:
- 50% higher employee productivity
- 13% fewer sick days taken
- 74% less stress
- 40% less burnout
- 186% overall performance gains [1]
These numbers are the first in a cascade of metrics that are vital to organizational health and growth. Burnout is responsible for a 2.5x increase to employee turnover (a massive cost problem in many organizations). Employees who trust their leaders to keep their word are more loyal, 28% indicating they would extend their time with the organization. The 2019 Trust Outlook echoed this sentiment with 33% of employees willing to stay with a company if leaders’ promises were kept, on top of 23% being more willing to share ideas and solutions. [2]
Trust is foundational to a healthy culture that drives real, measurable, positive outcomes for an organization. The question that matters? What kills trust, and what builds it?
Trust Killers
Conflict Avoidance:
Disagreement is important. If employees do not have the opportunity to disagree, there is less room for discussion and decision making to thrive. An environment that stymies employees and discourages challenging ideas from leadership is unhealthy. It is psychologically unsafe for employees and will degrade trust as they feel unheard and unappreciated.
Promise breaking:
As obvious as it may seem, keeping promises is vital to having high levels of trust. When leaders promise employees that certain actions will be taken and then don’t follow through, trust is destroyed. One important note here — there are both explicit and implicit promises. Leaders can explicitly say “I promise X”, or communicate to employees through actions or onboarding that something will happen. Employers need to carefully consider their communication with employees and stay on the pulse of what their people think has been promised to them, or trust will take some serious hits.
Trust assumptions:
Assumptions are dangerous. Trust is not a given, and takes time to build. If leadership acts under the assumption that trust exists where it has not yet been built, they might expect a given reaction to decisions (a promotion for example) that assumes employees trust their motivations and reasons, when in fact that trust has yet to be established.
Communication Breakdowns:
Trust relies on communication. Take the following scenario. A leader has two candidates for a managerial position. Both are qualified, one is female, one is male. The male candidate is chosen due to having more experience as a team lead. The promotion is announced but leadership fails to communicate the details of their decision with both candidates. As a result, the female candidate is left to wonder why she was skipped over. This uncertainty and lack of clear effective communication breeds distrust as employees are left to make assumptions instead of having a fact-based understanding of decision making. Intentional communication is vital to building long term trust.
Compliance over common sense:
In workplaces with fast evolving priorities, ever-changing risk, and dynamic challenges, business leaders can fall into the trap of prioritizing compliance with rules and process instead of giving employees the autonomy to make decisions, and also make mistakes they can learn from. In the long run, giving employees freedom to use their common sense is the wiser play for building trust. 63% of employees surveyed by Edelman said that employers have too much control and power over their daily professional lives. Compliance based leadership may work in a crisis, but long-term it will alienate employees and break down trust.
Trust Builders
Intentional Internal Communication:
In research of over 1700 companies in 64 countries across 18 different industries, IBM found that a key influence in outperforming peers is that openness is a key component of their culture. [3] Today, many successful companies are ditching the strict hierarchical structures of organizations in the past in favor of openness and transparency. Being honest, vulnerable, providing frequent feedback, setting goals and clear expectations all drive accountability organization wide and build trust as it eliminates misinformation and assumptions.
Approachable Leaders:
Edelman’s trust study keeps delivering data gems: 71% of employees believe it is critical for CEO’s to communicate and interface with their teams about sensitive topics and other company challenges. Building trust starts with leaders. Harvard Business Review conducted a study of 87,000 leadership positions. Those leaders who were rated above average on various performance factors were in the 80th percentile on trust, whereas their lower performing peers placed in the 20th percentile of trust scores.[4] Connected, trusted leaders get the buy-in they need from their organization and set the tone for engagement and commitment.
Purpose
For a large part of the workforce today, work is more than just a place to collect a paycheck. People are looking for a culture that provides them with purpose, aligns with their values, and allows them to be their most authentic self.
- ¼ of employees would never work for an organization that lacks purpose beyond revenue
- 71% are looking for more meaningful work and more intentionally purpose
- 42% would need a significant pay spike to work for an organization without purpose
Employees today want to build a career in line with their values. A vital component of building trust is digging into a meaningful mission together. Organizations can build lasting commitment and trust by engaging their employees and clearly communicating their mission and purpose, beyond the bottom line.
Change Together
Change is hard for everyone. Some embrace it and others tend to resist it, but it comes for every individual and every organization. As companies face new challenges and grow, change will be necessary. However, how that change is handled has an impact on employees’ trust.
Employers should treat their people as partners in times of change. Including them in the process and engaging with them is vital. Be transparent about why changes are happening, and how they will help build the organization’s future. Address their concerns, and provide training where necessary. Only 38% of employees think that their employer communicates effectively through change, and only 36% even think their employer was honest during those changes. [1] Transparency in times of change is important, change is as difficult for employees as it is for the organization, and it is a crucial time to either build or break trust.
These are just a few of the ways to build and break trust. Every organization and employee are unique, as are the challenges they face. However, without trust, it will be exceedingly difficult to build a healthy culture that empowers and engages employees and also drives positive business outcomes.
Have any questions about trust or building a great culture? We would love to connect and learn more about your organization. Just head to www.ledgestone.com/contact to get in touch!
References:
[1] https://www.edelman.com/trust/2022-trust-barometer
[2] https://trustedge.com/wp-content/uploads/2020/11/2019-Trust-Outlook.pdf
