Opinion: The need for trust
By Jason Cartwright, Group Director, Randstad.
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Jason Cartwright, Randstad.
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Trust is the bedrock of any healthy personal relationship. And it’s no different in the corporate world. In fact, trust is a commodity no business can do without – especially if they want to retain their people.
But Randstad’s World of Work Report 2011-12 found more than a quarter (26 per cent) of employees do not trust their leaders. With this level of distrust, it’s little wonder so many businesses struggle to retain talent – and there’s reason to think it will get worse.
According to Randstad’s research, 78 per cent of employers expect distrust to increase in the coming decade. When you factor in the impending exodus of Baby Boomers from the workforce and the rise of highly mobile Gen Y job shifters, talent retention is likely to cause more than a few headaches for businesses in Australia.
In the next decade, keeping staff and keeping them happy will require a lot more thought – and it will take more than attractive financial enticements, better work-life balance or increased opportunities to keep people on deck. While these are all critically important, fostering a strong culture of trust will need to feature prominently on the ‘to-do list’ for HR managers.
A real impact
Organisations and business leaders who lack trust generally expose themselves to a raft of productivity (and revenue) sapping issues, with retention challenges at the forefront. And nothing drives high turnover like distrust – distrust of colleagues, distrust of organisational direction, but most often it’s the distrust of leaders that causes the most damage.
Employees who don’t trust their leaders quickly become disengaged. Aside from being less productive, more often than not these employees are first out the door when times get tough, or a better offer comes along.
Unwanted turnover is expensive and according to some analysts, can translate to three times the annual salary of the individual leaving. But often the cost is far greater to the organisation, with staff morale dropping, then productivity, and so on down the chain.
Steven Covey, in his book The Speed of Trust, says low trust is one of the greatest costs in organisations and creates hidden agendas, politics, interpersonal conflict, interdepartmental rivalry, winlose thinking, defensive and protective communication – all of which can cause productivity to plummet.
Lasting trust on the other hand creates unparalleled success and sustainable prosperity, so when business, governments, and education leaders gain the trust of clients, colleagues, employees, business partners and other stakeholders, trust becomes a measurable accelerator of performance. When trust goes up, speed also goes up while costs come down, producing what Covey calls a ‘trust dividend’.
Putting trust back on the agenda
While business leaders are taking concepts such as leadership and management training more seriously, and providing their talent with exciting career paths, most aren’t seeing the writing on the wall when it comes to credibility and trust issues.
Less than 10 per cent of employers actually rate trust as the most important attribute of leaders, indicating employers still underestimate the importance of this core value. When you look deeper into business results, what you see typically is trust reduces as you travel down the organisational chart. In other words, trust is needed to be built both from top-down and bottom-up and is critical for employees at all levels to trust their colleagues and their leaders.
Opening communication
Increasing trust in an organisation doesn’t have to be hard work, or an expensive exercise. Often, it’s simply a case of communicating better – going beyond the fortnightly company newsletter.
With ongoing adoption of external communication tools for internal purposes – like Facebook, Twitter and Yammer – leaders now have the opportunity to capture knowledge and ideas via internal social media, forums and blogs.
But face-to-face communication is still one of the best ways to engage employees in the company mission and goals and to give them the opportunity to make contributions and ultimately build trust. Now more than ever, it’s important to walk alongside your teams, and never to stay too far from the front line.
In his book, Covey identifies 12 key – and cost free – behaviours that can engender trust within an organization:
- Talk straight
- Demonstrate respect
- Create Transparency
- Right wrongs
- Show loyalty
- Deliver results
- Get better
- Confront reality
- Clarify expectations
- Practice Accountability
- Listen first
- Keep commitments and extend trust
In the changing business climate, effective leaders are realising trust is not just a soft, social virtue but an economic driver that can have a significant impact on bottom line results. It is also a skill that is easy to learn and implement and as staff retention becomes an even greater challenge, business leaders are realising that transparency, inclusion and trust will be just as important as remuneration and flexibility for the future workplace.
Jason Cartwright is Group Director of Randstad, a Fortune 500 Company and one of the world’s largest recruitment & HR services providers. The Randstad Group employs over 520,000 people every day with the aim of taking the lead by ‘shaping the world of work’.
For further information visit www.randstad.com.au.
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- Your Career
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- Jason Cartwright, Randstad, bkellerman@financialpublications.com.au
- Article Posted:
- October 15, 2011
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