... why character and competence determine whether your company is judged a saint or a shyster.
Trust is a strange commodity. It grows gradually and thrives only when it is given away. When it disappears, it does so in a great rush, and once gone, it is harder to replace than it was to establish. We trust objects (that obey the laws of physics), but mostly we trust people. Some years ago, I came to recognize that we trust people for two reasons: character (or, more accurately, their motivations) and competence (or their capability to act). The “saint” who drops the hammer on your foot may be a wonderful person whose incompetence blocks your trust. The “crook” may be skillful but isn’t exactly trustworthy for obvious reasons.
The extraordinary power of trust is most visible when it is withdrawn. Consider accounting. Financial statements, after an audit, receive a letter of attestation from the auditors, thereby bestowing veracity on financial statements. Their “attestation” makes the numbers more believable. Nearly all the value of their endorsement lies in their perceived objectivity. When Enron was lit up by scandal, the credibility of the once trusted firm of accountants, Arthur Andersen, vaporized in an instant and the entire firm dissolved before our eyes. Whether from horsemeat in hamburger or the Lehman Brothers balance sheet, or frozen interbank lending that led us to the liquidity crisis of 2008, trust, which lies at the heart of our expectations of business, can be squandered. After all, a purpose can only really prove trustworthy when we can see it in action.TWEET THAT!
Visible evidence that a company’s purpose can be trusted exists at the organizational and individual levels.
If, as we suggest, trust is comprised of both character and competence (we might also call them motive and ability) then they must be demonstrated by both the organization as a whole and the individuals who represent it.
In an earlier piece on “the resilient company”, we saw how the identity of a business is reflected in two “faces” – an external face we call brand, and an internal face we call culture.
Trusted brands are those identities that are known to stand for something we deem important, even worthy, and are able to live up to their promise consistently. We trust Wal-Mart to deliver low prices, everyday. They nearly always do, and if you ask anyone who sells to them if the company knows how to negotiate low cost, you will find they are exemplary. Where our trust weakens is when we begin to wonder whether their intention is to drive each and every small, mainstreet shop out of business in whatever community they operate.
Trusted businesses are populated with employees who can be counted upon to live up to the company promise. Similarly, as employees, we trust the internal identity of the business when we share the ambition of the company and our coworkers and believe in our shared ability to do what we promise. If, for a moment, we reduce businesses to what they really are, we find a group of people (employees) doing worthwhile things for other people (customers). While we formulate a sense of the trustworthiness of business through collective action, our real interactions with a business are personal and one-to-one.
Recently, our family and business changed banks. It is a messy and annoying process of disentanglement, triggered by the continued inability of our bank of 30+ years to meet our needs through their technology and other platforms. Long after confidence in our old bank failed, we stayed because we trusted Jan to figure out the necessary work-arounds. Our confidence in the new bank is largely derived from Dave, Melanie and Marie. They live out a shared culture exemplifying the brand identity, and so win our trust in the stated purpose of this bank to make banking comfortable. They do, and so far, it is.
As you reflect on the stated purpose of your company, does it seem worthy of others’ trust? Are you an ambassador of that brand? The answers now matter more than ever.