Home > Academics, Business-Economy > Putting “trust” in the driver seat…

Putting “trust” in the driver seat…

November 8, 2010 Leave a comment Go to comments

Often times, business leaders become so hooked onto profitability objectives that they lose sight of their key stakeholders – customers. This has also been one of the reasons why many companies couldn’t weather the financial storm of 2008. Many in the media call it the credit crisis… and if you see, credit comes from the latin word, credo, meaning credibility / trust. So, this unprecedented crisis was actually a TRUST CRISIS where mistrust between different business stakeholders led to the global economic downfall. Just recently, I was having dinner with Charles Green (the founder CEO of Trusted Advisor Associates and writer of a book by the same name) and we were discussing the ramifications of mistrust in organizations. Charles explained that executives seem to forget the basic nuance of trust being difficult to achieve but easy to lose. Even Richard M. Sternhell (the former Managing Principal of Towers Watson) was present at the dinner and he shared his real-life anecdote of how being trustworthy early on in his career helped him become remarkably successful. The primary issue plaguing the business world is this rat-race of who gets to the cheese first. No one seems to have the time to think how credible are the means they’re taking to reach that end.

The worst outcome of all this evil is a “transactional view” to business. Right from the CEO to the floor supervisor, everyone think about every component of the business as a transaction… “Reduce the procurement transaction lead time”, “Increase the revenue per transaction”, “Maximize number of transactions per customer”, “Standardize the transaction”. One thing that is being royally ignored in all this is RELATIONSHIPS. No one seems to think about the relationships in business… be it within the top management or with the employees or even with the customers. And with no relationships, there can be no trust in business!!! It is vital for organizations to start looking at business from a relationship perspective. As Warren Buffet mentioned of the Berkshire Hathaway acquisition of McLane Distribution from Wal-Mart for $23billion – “We did no due diligence. We knew everything would be exactly as Wal-Mart said it would be, and it was.” If I consider this from a consulting career perspective, trust can yield many benefits:
– Give consultants bigger opportunities
– Help consultants have greater impact
– Make consulting work more enjoyable

Charles Green has redefined the trust equation from just a sum of credibility and reliability to:
Trust = (Credibility + Reliability + Intimacy) / Self-Orientation

While credibility is all about perceived capabilities and reliability is about repeated experiences of having promises kept, the new building blocks of intimacy mean how enjoyable it is for the client to work with consultants, and self-orientation is the opposite of how much you hold client’s interest over yours. As my Strategy Consulting professor taught me about a consulting career, the secret to building trust with clients is:
– Build trust by giving trust
– Involve the client
– Help the client be more effective internally
– Make deliverables more useful to the client
– Make client interactions more valuable
– Be accessible, available and knowledgeable about the client’s organization

Don’t forget that the fear of risk taking may hinder you from engaging in trust-building activity!!!

  1. November 16, 2010 at 5:05 am

    like the article it may be hard to open up to trust being if you have been burned before …

  2. November 16, 2010 at 7:40 pm

    @ Gene Perez: You’re absolutely right… trust is one of the very few things that requires disproportionately greater effort to acquire than to lose. That being said, trust is individual most of the times and institutional at times. So, it is important to not let mis-experiences with one individual/institution influence your trust building with others. At the end of the day, the idea is to use trust as a plane leveler in any communication.

  1. November 8, 2010 at 4:08 am

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: