Whether it’s the world of business, politics or sports, there is no shortage of leadership failures to illustrate the effects of broken trust on a personal and organizational level.
Consider these recent, well-known examples of prominent leaders breaking trust where the damage extended beyond the individuals:
Tony Hayward, former CEO of BP, left the company after his series of trust-eroding gaffes and missteps following the Deepwater Horizon oil spill in 2010. BP received significant public criticism and damage to its brand image as a result of Hayward’s seemingly uncaring response to the environmental disaster.
Jim Tressel, former head football coach at The Ohio State University, resigned under pressure in May 2011 after admitting he knew some of his players had violated NCAA rules but chose not to alert his superiors about the infractions. Between self-imposed penalties and those handed down by the NCAA, Ohio State stands to lose millions of dollars in football revenue.
New York Congressman Anthony Weiner resigned under pressure last year after initially denying, then later admitting, he sent a lewd picture from his Twitter account and engaged in “sexting” with numerous women over a period of years. Weiner’s actions seem to reinforce a growing lack of trust in politicians and their integrity.
Trust or Consequences
Prominent breaches of trust such as these garner the news headlines, yet it’s leaders’ everyday actions that determine the level of trust in organizations. Most employees have experienced broken promises, unfulfilled commitments and leaders withholding information, have been treated unfairly or heard blatant lies and dishonesty in the workplace. Repeated occurrences of these kinds of trust-busting behaviors by leaders foster low-trust environments resulting in employees who are demoralized, afraid to take risks, disengaged, unproductive and ultimately at a higher risk to leave the organization.
According to “Trust Matters: New Links to Employee Retention and Well-Being,” a 2011 Kenexa High Performance Institute WorkTrends report, 50 percent of employees who distrust their senior leaders are seriously considering leaving their organization, compared to 14 percent of those who do trust their leaders. Deloitte’s 2010 “Ethics and Workplace Survey” reports that 48 percent of employed Americans who plan to look for a new job as the economy improves are doing so because of a lack of trust in their employer and a lack of transparent communication from senior leadership.
Distrust in leaders and organizations has health and well-being implications for employees as well. According to the “Trust Matters” report, employees who distrust their leaders are seven times more likely to report they are mentally and physically unwell, and 62 percent of employees who lack trust in their leaders report unreasonable levels of stress compared to 13 percent of those who do trust their leaders.
Trust Improves the Bottom Line
Organizations are increasingly taking proactive steps to build high-trust cultures because it helps improve the bottom line. Lowe’s, the second largest home improvement retailer in the world with more than 1,750 stores in the U.S., Canada and Mexico and nearly 235,000 employees, emphasizes the importance of trust in its leadership development practices and has seen the benefits.
Greg Nell, vice president of learning and development and a 22-year veteran of Lowe’s, said, “My personal experience at Lowe’s, as well as the results from our employee engagement surveys, has shown that when there is a high level of trust and engagement in teams or stores, people costs around accidents, turnover, sick hours and inventory shrink are less, customer satisfaction is higher, and sales and profits are higher. Conversely, in stores or teams that have a lack of trust, the engagement results are lower and the people costs are up.”
Nell’s experience at Lowe’s has been mirrored in several studies and reports that show the benefit of trust in the workplace. Research by the Great Places to Work Institute, publisher of the Fortune 100 Best Companies to Work For list, has shown that between 1997 and 2011, high-trust companies outperformed the Russell 3000 and S&P 500, posting annualized returns of 10.32 percent versus 4.02 percent and 3.71 percent, respectively. Further, those best companies provide four times the returns as market average for comparative low-trust companies and typically experience a 50 percent lower turnover rate.
A Common Language of Trust
For leaders and organizations to realize the benefits of high levels of trust, they should establish a common definition and framework of how to build it. Many people don’t give much thought to intentionally building trust; they just assume it happens over time. Yet the reality is that trust is built or eroded by the use of specific behaviors that people perceive as either trustworthy or untrustworthy (Figure 1). For leaders to be successful in developing high-trust relationships and organizational cultures, they need to focus on using behaviors that align with the four core elements of trust. To represent the four elements in the language of trust, The Ken Blanchard Cos. created the ABCD Trust Model — Able, Believable, Connected and Dependable (Editor’s note: The author works for The Ken Blanchard Cos.).
Able: Being able is about demonstrating competence. One way leaders demonstrate their competence is by having the expertise needed to do their jobs. Expertise comes from possessing the right skills, education or credentials to establish credibility with others. Leaders also demonstrate their competence by achieving results. Consistently achieving goals and having a track record of success builds trust with others and inspires confidence in one’s ability. Able leaders are also skilled at facilitating work getting done. They develop credible project plans, systems and processes to help team members accomplish their goals.
Believable: A believable leader acts with integrity. Dealing with people honestly by keeping promises, not lying or stretching the truth and not gossiping are ways to demonstrate integrity. Believable leaders also have clear values that have been articulated to their followers, and they behave consistently with those values — they walk the talk. A 2010 Maritz Research survey reported that 11 percent of respondents strongly agreed that their managers showed consistency between their words and actions. Treating people fairly and equitably are also key components to being a believable leader. Being fair doesn’t necessarily mean treating people the same in all circumstances; it means people are treated appropriately and justly based on their own situations.
Connected: Showing care and concern for people builds trust and helps to create an engaging work environment. Connectedness with leader and connectedness with colleague are two key factors involved in creating employee work passion, and trust is a necessary ingredient in those relationships. Leaders create a sense of connectedness by openly sharing information about themselves and the organization and trusting employees to use that information responsibly.
Leaders also build trust by having a people-first mentality and building rapport with those they lead. Taking an interest in people as individuals and not just as nameless workers shows that leaders value and respect their team members. Recognition is a vital component of being a connected leader, and praising and rewarding employees’ contributions and their work builds trust and goodwill.
Dependable: Being dependable and reliable is the fourth element that builds trust. One of the quickest ways to erode trust is by not following through on commitments. Conversely, leaders who do what they say they’re going to do earn a reputation as being consistent and trustworthy. Maintaining reliability requires leaders to be organized so that they are able to follow through on commitments, be on time for appointments and meetings, and get back to people in a timely fashion. Dependable leaders also hold themselves and others accountable for following through on commitments and taking responsibility for their work outcomes.
By using the ABCD Trust Model, leaders can focus on the behaviors that build trust, and by sharing this model with those they lead, create a common framework and language to discuss trust issues in the workplace.
Rebuilding Damaged Trust
Despite their best intentions, there will be times when leaders break trust with those they lead. Although trust can take a long time to build and just a moment to destroy, there is hope for recovery if the parties involved are willing to put in the time and effort necessary to restore a healthy level of trust to the relationship. Leaders can follow this five-step process to rebuild broken trust:
1. Acknowledge: The success of the 12-step recovery process shows that the first thing that has to be done is acknowledge that a problem exists. Depending on its severity, a breach of trust can have difficult and emotional consequences that many leaders would rather avoid. Yet to begin the rebuilding process, leaders must acknowledge a situation exists and needs to be addressed.
2. Admit: Second, leaders have to admit their part in causing the breach of trust. They need to own up to their actions and take responsibility for whatever harm was caused. This is a crucial step that leaders shouldn’t overlook. Refusing to admit mistakes reflects negatively on a leader’s believability and can let a mistake in judgment turn into an indictment of character.
3. Apologize: The next step in repairing damaged trust is for leaders to apologize for their role in the situation. A good apology incorporates steps one and two — acknowledging the mistake and admitting involvement — and expresses regret for the harm caused and assurances that the offense won’t be repeated. The apology needs to be motivated by sincerity and remorse, not be contrived or forced. Avoid making excuses, shifting blame or using qualifying statements that detract from the apology.
4. Assess: The fourth step is to assess which elements of the ABCD Trust Model were violated and create an action plan to improve in those areas. In their assessment, it’s important for leaders to narrow down the specific behaviors that caused the breach of trust. Repairing a breach of trust can seem like a daunting task, but if leaders identify the specific behaviors at the root of the issue, they can create a manageable and realistic plan to move forward.
5. Agree: The final step in the trust rebuilding process is to agree on an action plan with the offended party on what will be done differently moving forward to help rebuild trust. This step is an ongoing process of evaluating the consistency of the leader’s behavior and its alignment with the action plan.
Leaders can afford many kinds of mistakes, but the one thing they can’t afford to lose is trust. The ability to build and sustain high levels of personal and organizational trust is a defining and critical competency for today’s leaders. By using behaviors that align with the four core elements of trust — able, believable, connected and dependable — leaders can effectively build trust and lead their teams to higher levels of productivity, engagement and success.
Randy Conley is the trust practice leader at The Ken Blanchard Cos., a leadership training organization. He can be reached at email@example.com.