You might say I am on a “trust” kick.
In last week’s blog, I highlighted a US decline in social trust (a precipitous drop of 46% points from 1964 to 2016). I also opined on the critical role of trust in strengthening the social contract between businesses and customers. Finally, I asserted that
trust begets trust. As such, I suggested business
leadersshould take the first step by trusting customers out of respect and gratitude for them.
Value of Trust
So this week, I thought I’d look at the “value of trust,” first from the perspective of shareholder returns and then from the vantage point of benefits to the entire business ecosystem. In his seminal work, “
The Speed of Trust ,” Stephen M. R. Covey cites a study conducted by Watson Wyatt that showed, “
Total return to shareholders in high-trust organizations is almost three times higher than the return in low-trust organizations.” In other words, when employees feel they can trust their leaders, investors tend to reap greater returns.In addition to investor returns, high trust organizations are good for leaders, team members, and even customers. I depict this relationship in the formula:
High TRUST = Happy Employees = Happy Customers = Happy Shareholders = Happy Leaders Research Support
In support of my formula, Neil Davey, the managing editor of mycustomer.com
recently cited David Ulrich’s research on the value chain of trusting and engaging employees. David Ulrich is a professor of business at the Ross School of Business at Michigan. Neil cites David’s research noting that it demonstrates, “For every 10% increase in employee engagement levels, a company’s customer service levels go up by 5%, and profits by 2%.”By contrast, employee distrust,
disengagement, and neglect for development create the environment for most customer complaints. Neil notes, “A recent survey of 3,000 consumers by the Institute of Customer Service (ICS) reveals that staff attitude and staff incompetence are rated the ‘most annoying or frustrating’ service problem, while ‘people-related issues’ account for a whopping 62% of all complaints.”I have often said,
if something doesn’t live inside an organization, it won’t be perceived outside the organization.
Key Leadership Behaviors
What do great leaders do to build the trust of those they serve? While the list is long, I will focus this blog on three key behaviors:
Share a Vision Make Promises in Keeping with that Vision Honor Your Promises Share a Vision
It’s hard to trust a captain without a compass or an Uber driver who is unwilling to use a map or navigation guidance. By taking the time to create and articulate your vision you offer your people navigational bearings or a sense of “true north.” The delineation of vision allows them to choose if they want to join you on the journey.In the context of working with leaders at Mercedes-Benz and writing my book
Driven to Delight – Delivering World Class Experience the Mercedes-Benz Way, I witnessed first-hand the trust-building power of crafting a vision for the desired future state. In the case of Mercedes-Benz leadership, that vision was shared both through words and in the form of a
visual roadmap.
Make Promises in Keeping with that Vision
Once people know where you want to take your organization, you must
commit to the steps needed to help them get there. While consulting at Mercedes-Benz, I watched this willingness to verbally commit to a course of action build incredible trust with employees and dealer partners. Then CEO, Steve Cannon, promised the following through a video known as
The Standard:“<This year> will see the introduction of the most comprehensive
pledge to an extraordinary customer experience in the history of Mercedes-Benz.
Every department will be mobilized.
Every touchpoint in the brand will be examined and refined.
Every employee in every dealership will be trained and equipped.
We will begin immediately and will not rest until we are viewed as the global benchmark…”
Related: Business Consistency With a Twist: All Business is Personal Honor Your Promises
Nothing erodes trust more quickly than false promises.
It may be better to commit to nothing than to commit and fail to act in accord with one’s commitments. In the case of Mercedes-Benz, despite many possible distractions, leaders stayed their course and provided touchpoint mapping, toolkits to activate the maps, and training for every corporate and dealership employee.
Trust, Engagement, and You
What are the trust and
engagementlevels of your workforce? I suspect those trust levels are impacting customer engagement and your ROI. Moreover, I believe
you can drive trust in your organization through vision creation, commitments, and actions in support of those commitments. What do you think?
