Passion, People and Principles

Creating a High-Trust Organization

post # 86 — May 24, 2006 — a Managing, Strategy post

In a recent blog and article, I argued that law firms are remarkable for being low-trust institutions, and that this prevents them from accomplishing many of their goals because individuals do not work to advance the institutions goals, but mostly their own.

Mel Bergstein, who has just stepped down as CEO of the major consulting firm that he founded (Diamond Cluster) pointed out in a comment on my blogpost that the issue was much more generalizable, and that creating trust in organizations was a common challenge for all organizations of knowledge workers.

I’ll be writing a follow-up article about this in the future, but here are some preliminary thoughts about what it takes to create an organization where people trust each other and work for the common good, thereby also achieving more for themselves as individuals.

Selectivity in hiring, screening out those who don’t want to be team players
A written constitution that spells out the common ideology of the organization, and what it means for personal behavior — explicit not implicit, no ambiguities, please.
Some kind of programmed socialization process so that new people (entry level or senior hires) are shown about the way the organization requires them to behave
Careful selection of managers with both personal values and the courage and skills to tackle untrustworthy behavior (even or especially that demonstrated by powerful people) early, rather than waiting till the problem is egregious. (Values, Courage and skill – that’s a heck of a package to ask of managers!)
A focused strategy around selective market segments and services, so that there are lots of opportunities for people in different parts of the organization to interact and hence build up trust through repeated experiences of working together
Abandonment of measurement systems that report individual or small group results, and which create pressure on people to worry primarily about their own performance rather than the success of the institution.

This is not a complete package, but I hope it’s enough to stimulate some discussion. What do YOU think it takes to create a “High Trust Organization?”

6 Comments

Hunter said:

“f” is worrying. Individual measurments of performance are essential, as excellence is impossible without some intra-company competition. At the end of the day, companies need to be able to assess the efforts and abilities of individual people. I would prefer to add metrics for cooperative behavior rather than to subtract the metrics for individual performance. If you had a scorecard, perhaps of five factors, two should be organization-oriented and three should be small group or individual oriented.

posted on May 24, 2006

Suzanne Rose said:

David, I would add the organization’s willingness to communicate top to bottom and to listen bottom to top. Those on the front lines have much to contribute and appreciate being heard. If the organization is willing to implement some of their ideas, trust increases even more. I also believe that consistency in management is important in maintaining trust. In addition, I have found that law firms, and maybe other professional firms, like to “hide the ball” when it comes to explaining to associates what is expected of them; i.e., how to become a partner. (Associates are expected to act like an owner but are treated as an employee.) A firm’s unwillingness to articulate its expectations is an indication that maybe the firm doesn’t know what it expects, which is a bit scary to an up and rising associate; or that the firm is literally hiding something. Finally, failure to successfully manage the firm well certainly undermines trust.

posted on May 24, 2006

Ava C. Thorin said:

Trust is a confidence that grows, over time, from a demonstrated track record of honesty, integrity, veracity and reliability. These are qualities in very short supply in most organizations. (If this were not the case, you would have longer “best places to work” lists.;)) Come to think of it, trust is in short supply in the socio-political-econimic sphere of the 21st Century.

Why should an employee trust a corporation that hires them “at will,” outsources their jobs, closes plants and offices for cheaper pastures, compromises their pensions, and frequently minimizes raises while it obscenely rewards its top executives. At one time, people willingly gave their all to the corporation because there was this “trust,” this “promise” that the corporation would take care of the employee when their service ended. (The pension. The gold watch.) This is no longer true. The free marketplace rules and people change jobs without hesitation or reservation. Trust requires reciprocity and interdependency. An organization must show employees that their work is important, that their opinions have value and that the organization explicitly recognizes and communicates its obligations in the relationship. If an organization respects its employees by keeping its commitments, keeps the channels of communication and community open to all and pays an honest wage for an honest day’s work lack of trust will never be an issue. When it comes to trust, you get what you give.

posted on May 24, 2006

Shawn Callahan said:

Here is another angle you might wish to consider for your article David: avoiding distrust and rebuilding trust when it is lost. Much has been written on the topic of trust-~~I have a bibiography with over 100 articles which I’m happy to share if anyone is interested~~-but much less has been written about how to rebuild trust once it has been broken. I did find some useful ideas from the South African reconcilliation process. The process there went something like this: 1) the parties must have a need to work together in the future; 2) the trust breaker needed to admit to the agrieved that trust was broken; 3) trust breaker needed to offer something to compensate (not the right word) for the breakage; 4) agreived needed to accept. It has been pointed out to me that this model assumes the situation is unambiguous, which it never is. Love to hear what you think about this issue.

The other aspect I’m interested in is whether it is better to reduce distrust rather than just focus on building trust. Trust being the confident positive expectations regarding another’s conduct while distrust is the confident negative expectations regarding another’s conduct. Check out this reference for a discussion on trust and distrust:

Lewicki, R. J., D. J. McAllister, et al. (1998). “Trust and Distrust: New Relationships and Realities.” Academy of Management Review 23(3): 438-458.

posted on May 24, 2006

Norman Dragt said:

The model presented here is clearly the outcome of a Anglo-American culture. It stresses clearity through rules and regulations. It puts the responsibility for behavior with the organization.

However everytime the rules are made more explicit humans go out to find the loopholes.

Probably the reason why in the rich western countries lawyers and accountants (occupations that must keep us honest) abound. And our behavior creates the need for other countries to follow us. As we have more and more workers thinking up methods of proving our trustworthyness (which probably also creates the feeling we are to be distrusted).

But in the end all people are looking for is security, not trust. They want to lower any uncertainty about their surroundings. That can be done by creating clearly written rules or by forcing your culture on others. Where probably the only working solution for creating certainty is getting to know the people you are working with by treating them as goals as Kant once said.

posted on May 25, 2006

Jerome Alexander said:

Employees come to work with an implicit trust that their managers are always working for the best interest of the company and its employees. That trust should not and cannot ever be taken for granted. Look what is happening today. It is no longer “What’s good for the company is good for the manager.” It has become “What’s good for the manager is good for the company.” Top executives have totally lost sight of this phenomenon and are allowing managers to run amok for their own personal agendas.

Several years ago I wrote a book on the subject of workplace culture and employee morale. It is as relevant today as it was then. Employee morale is directly linked to the interaction of employees with line managers who are charged with executing the policies and strategies of companies. Unfortunately, many of these managers subvert the good intentions of the organization to meet their own personal goals and agendas at the expense of their peers and subordinates. This management subculture is the result of a corporate culture of ignorance, indifference and excuse. Better corporate level leadership is the key. Read more in “160 Degrees of Deviation: The Case for the Corporate Cynic.”

Jerome Alexander

posted on January 20, 2007