Why character and competence determine whether your company is judged a saint or a shyster.
Trust is a strange commodity. They say that trust takes years to build, seconds to destroy, and a lifetime to rebuild. Trust grows gradually and thrives only when it is given away. When trust disappears, it does so in a great rush, and once gone, it is far harder to replace than it was to establish. We trust objects or natural laws (for instance, that my chair will obey the laws of physics and not float away the instant I am about to sit in it), 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 his obvious lack of character.
The extraordinary power of trust is most visible when it is withdrawn.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, testifying to the veracity of the financial statements. Their “attestation” makes the numbers more believable. Nearly all the value of this endorsement lies in the expertise and perceived objectivity (based on character) of the auditors. 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. Trust, which lies at the heart of our expectations of business, can be squandered, whether by horsemeat in hamburger or the Lehman Brothers balance sheet, or frozen interbank lending triggered the liquidity crisis of 2008.
Visible evidence that a business purpose can be trusted is found at both the organizational and individual levels. Because trust is comprised of these two elements—character and competence (we might also call them motive and ability) – they must be demonstrated by both the organization as a whole and the individuals who represent it.
Businesses, of course, are essentially collections of people (employees) doing worthwhile things for other people (customers). While we formulate a sense of the trustworthiness of business through its collective actions, our real interactions with a business are personal and one-to-one.
A business purpose can only really prove trustworthy when we can see it in action.
In an earlier piece on “the resilient company”, we saw how the identity of a business is reflected by two “faces” – an external face we call brand, and an internal face we call culture.
We trust brands (the external face) that stand for something we deem important, even worthy (character) and are able to live up to that promise consistently (competence).
For instance, we trust Starbucks to deliver a welcoming, comforting experience and a high level of quality anytime we enter the doors under that familiar green logo, no matter where we are in the world. The company’s success, in large part, stems from its exemplary ability to deliver on this expectation. Similarly, when we encounter a company’s culture (internal face) through its people, we are offered a referendum on our trust of the brand based on their ability to do what they (and the company) promise. An employee who treats me with disdain, or whom I observe spitting in someone else’s drink (May it never happen!) would forever alter my trust for Starbucks!
Trust for a business is a complicated and multi-layered entity. But it is clear that trusted businesses are populated with employees who can be counted upon to live up to the company promise.
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 platform. 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 the brand, exhibit a shared culture and so win our trust in the stated purpose of this bank to make banking comfortable. They do, and it is.
As you reflect on the stated purpose of your company, does it seem worthy of others’ trust? Are you? The answers matter more now than ever.