Establishing Trust, Why it Matters

Ideally trust is achieved in a relationship.  Absent a relationship, employees will observe leader traits to determine whether they are trustworthy or not. For example, a leader that holds an elevator for people conveys that they are willing to serve others and not just be served.  Employees will likely watch for other leadership traits as well, such as: Approachability, Listening; do they listen well? Follow-through; do they do what they say they are going to do? Accountability; do they apologize if they say something wrong?  Executives have to remember that the workforce scrutinizes what they do.  Your deeds have to match your words, because everyone is watching.  Any misstep between words and actions will be noted and will ‘go viral’ inside—and even outside—the organization’s walls.

More importantly, the level of trust employees have for senior leaders impacts engagement.  According to The Employee Engagement Report 2011, released Dec. 15, 2010, by BlessingWhite. The survey of nearly 10,914 employees on four continents revealed that employees who trust their organization’s executives are more likely to be engaged at work than those who only trust their direct supervisor.

Employees who don’t trust leaders may jump ship because they’re not confident in the organization’s direction or aren’t certain of the leaders’ motives. A lack of trust breeds distractions and side conversations about hidden agendas, which damages productivity.  Discretionary effort suffers, because employees aren’t willing to go above and beyond for leaders they don’t know or trust.

But it is more important for trust to be present in closer working relationships, particularly with those leaders within “arm’s reach” of an employee. The level of trust an employee has for a supervisor influences how the employee perceives those who are farther up the chain. For example, if a supervisor talks about a workplace issue in a way that is degrading of a senior leader, it can impact the level of trust employees have toward the senior leader and color their perception of the immediate supervisor. There’s a way that the supervisor can communicate in order to remain trustworthy, such as explaining the facts without added commentary. Yet what often happens is that a supervisor’s frustration seeps out with badmouthing and backbiting and gossiping.

Leaders have to observe and acknowledge what their people have experienced and be very careful about their tendency to gloss things over and sweep them under the carpet.  When trust has been broken, it is emotional. People can feel devalued, discounted. There must be permission to express these feelings and emotions.  Ideally, such feelings will be conveyed in a constructive way. Get and give support to others in the process. Reframe the experience and shift from being a victim to taking a look at options and choices. It’s not necessarily what happens to us that’s important, it’s how we respond.  (Attitude! Ah but that’s another topic) Take responsibility. Ask: What did I do or not do that caused this to happen?  Forgive yourself and others.  Let go and move on.

Trust Builds Great Employees

The glue that holds all relationships together — including the relationship between the leader and those they lead is trust, and trust is based on integrity.

When employees do not trust managers and leaders, various forms of organizational fallout are likely, including low engagement (people seem like they don’t care), high turnover and reduced innovation (no creative solutions or ideas).  Rebuilding trust isn’t easy, just as with customers who lose trust.  If employees don’t trust their boss or their boss’ boss, they begin to question how they fit in with the company and will have less pride in the organization overall.

Individuals can enjoy their work and have a strong sense of accomplishment, but Trust has to be present for employees to do go beyond the call of duty, to be innovative.  The more groundbreaking the innovation needed, the more trust must be present. Trust is built over time as people get to know each other.  Employees must trust that their co-workers and direct supervisors are competent (head trust) and will do the employee no harm (heart trust).

A single triggering event, such as a restructuring or other organizational change, can reduce the level of trust employees have in leaders.  As can other single events, such as a manager who takes credit for an employee’s work or lies to them.

Most of the time, trust erodes as a result of small subtle patterns of behavior that employees experience on a daily basis that go unaddressed. For example, working with peers who fail to prepare for a meeting, are slow to respond to e-mail or who gossip regularly. While they don’t get addressed, they don’t go unnoticed.  The result of such unaddressed behavior is that employees leave the company or, worse yet, they stay. They become the working wounded – they stay, they complain, they do as little as possible, eventually bringing others down with them.

The Reina Trust and Betrayal Model describes three main types of transactional trust:

• Contractual trust—trust of character. Do people do what they say they are going to do? Do managers and employees make clear what they expect of one another?
• Communication trust—trust of disclosure. How well people share information and tell the truth.
• Competence trust—trust of capability. How well people carry out responsibilities and acknowledge other people’s skills and abilities.

The key thing about transactional trust is that it is reciprocal in nature; you have to give it to get it.  There are specific, concrete behaviors that build trust.

• Ability: the manager’s ability to do their job.
• Understanding: displaying knowledge and understanding of employees’ roles and responsibilities.
• Fairness: behaving fairly and showing concern for the welfare of employees.
• Openness: being accessible and receptive to ideas and opinions.
• Integrity: striving to be honest and fair in decision-making.
• Consistency: behaving in a reliable and predictable manner.

So take a look at your employees, what does their behavior say about their trust in you.  If it doesn’t look good, take the steps now to begin the process of rebuilding trust.

Successful Mergers Part II

So once you get the people part right. Another essential factor is effective leadership and having crystal clear objectives and direction. Not only the general purpose of the new organization, but 3 month, 6 month and the medium and long-term goals of the organization should be so clear that it is virtually  impossible for employees, management and customers to misunderstand them.

Effective communication is essential for companies to perform well and is even more vital for successful mergers. Both internal and external communication is the key to keeping employees on the right track, retaining customers and maintaining organizational stability. So why don’t all organizations communicate effectively?

Internal communication is not a legal obligation. External communication, sometimes being a legal requirement, is generally better handled than internal communications.

Communication can be time intensive for senior leaders. During the uncertainty, there might be clear and immediate answers to questions raised by the
employees, but it takes a substantial amount of time to communicate this, which managers may be reluctant to spend. Communication can include tough messages. There are, in general, very hard and sensitive decisions to take during the merger. Managers may be unwilling to be completely open and transparent with employees for fear of employee resistance and productivity loss. However, a lack of communication can create the same, and even worse.

It is difficult to quantify the results of communication. It, therefore, turns out to be more ‘desirable’ than mission-critical. Nevertheless effective
communication builds trust and acceptance, and keeps employees focused on the important work. It can mitigate damage caused by the ‘rumor mill’ and relieve anxiety.

Successful communication can inspire faith in and support of the company’s vision and culture. The key element of successful communication is two-way
communication. Listening as well as telling enables management to convey business, strategic or tactical decisions and receive important employee input.
What can enable effective communication in mergers?

Researching your audience.  Asking them what they want to know, and how they wish to be communicated with.

Getting senior leaders to lead the effort, and model the required behaviors.  Communicating clear and consistent messages. Training and supporting managers to leverage the power of face to face communication with their employees.

Monitoring the effectiveness of your communication, by using effective listening tactics. Besides the human factors, some management issues can occur during the integration phase, and hence establishing an integration team (even small mergers should have a focused team) that is charged with developing plans, projects and tasks to ensure the successful completion of integration is vital. This team should be given the financial and time resources to accomplish this critical step in the change process.

Last but not least; all the quick wins or achievement needs to be shared within the organization as soon as possible. Celebrating and publicizing those wins to everyone boosts morale and enhances productivity.

Mergers are difficult processes that require very good leadership and communication skills, crystal clear objectives, very good planning, show cases and most importantly the best people in the organizations to accomplish a thorough job.

 

The basics of good leadership

Throughout my career I have had the opportunity to work with numerous senior leaders.  In trying to understand where I may be able to help them I typically ask “What are the three or four biggest challenges you’re facing in your business right now?” Even with an incredibly diverse sample of businesses, it has been interesting to see a clear pattern emerge of four specific issues that the vast majority of these leaders identify as the things that are holding their organizations back and keep them up at night.

1. Lack of a vivid and extremely well-communicated vision

Even though these leaders are passionate about the vision and direction of their company, they reluctantly admit that if you were to go just one or two levels below them in the organization, you would likely find very few, if any, employees that truly understand the vision, mission and core values of their organization. A major job of every leader, whether you lead two people or 20,000, is to relentlessly communicate an exciting and clear vision for the future of the organization. In one-on-one meetings, town halls, e-mails, voice mails, team meetings …  the goal is to help people clearly see where the business is headed and what they need to focus on to make sure you all arrive there together successfully.

2. Lack of open, honest and courageous communication

The inability or unwillingness to put difficult, uncomfortable and awkward topics on the table for candid and transparent discussion was identified by these leaders as a major inhibitor to their ability to build strong teams and get their organizations fully aligned. As Patrick Lencioni points out in his superb book “The Five Dysfunctions of a Team,” in large part this lack of openness stems from a fundamental absence of trust that leads to unwillingness by people on the team to be vulnerable and completely honest. However, the desperate need for courageous communication and high levels of transparency is powerfully demonstrated in Jim Kouzes and Barry Posner’s seminal book “The Leadership Challenge,” which undeniably shows that honesty is the single most important driver in establishing credibility as a leader. Especially in times of great turmoil like we are facing now, employees crave as much information as they can get about how things are going in the company and what they need to do to keep it moving forward. Where there is a lack of a well-communicated vision mission and values, you quickly see fear, politics, rumor-mongering rushing in to fill the void.

3. Lack of accountability

As a direct result of the lack of honesty and courageous communication mentioned above, one of the difficult conversations not occurring is a frank discussion about tolerating mediocre performance. After taking a good, hard look at their business, many of the leaders I work with realize that they have a few mediocre performers in key positions in their organization and that every day they leave them there is another day they are in effect saying to the rest of the company, we were just kidding about pursuing excellence.  The truth is it is not right to let a small few jeopardize the organization and destroy their own career because their leader did not have the courage to tell them the truth about their poor performance. Here is a test will bring this into sharp focus:  Think of a person in your organization that consistently delivers sub par work, turn things in late and has a poor attitude. … Now realize that, because they still have their job, this individual is the person who establishes the level of acceptable work for every other employee in your company. How does that make you feel?

4. Lack of disciplined execution

What percentage of the time do you think companies that have a solid plan for how to succeed in the marketplace … actually effectively execute to plan? The answer has remained the same year after year: 10 to 15%. That number is shockingly low.  What is even more devastating is to realize the monumental waste of talent, resources, opportunity and money that low number represents. However, the process for ensuring effective execution is really straightforward and simple. Just a handful of key steps need to be applied with vigor and total accountability. Leaders just have to be willing and able develop a culture of disciplined execution by establishing the systems, processes and checkpoints to ensure consistent flawless execution of all critical initiatives

At the end of the day, none of the things listed here are particularly new or revolutionary. Actually, I am sure that most of us will recognize them as well-established fundamentals for leading a world-class organization. However there is a huge difference between knowing something … and living it every day in your organization.

Can Corporate Culture be Changed?

Organizations seek out my assistance in helping them make their organizations better. “Better” might mean more effective leadership, higher performance, improved employee retention, effective compensation plans, improving team performance or simply creating a more cooperative, positive work environment.

After a thorough assessment of a client’s current operation and needs assessment, I am in a better position to present solutions that will address their gaps. Some of those solutions involve  policy changes, process changes, some involve personal coaching, and some involve proactive culture refinement — culture change.

When considering culture change, many senior leaders believe that corporate culture cannot be changed. I’m not surprised at this belief.  In my experience most senior leaders, throughout their entire careers have not lived through successful culture change. Even fewer have led successful culture change.

But here’s the question: Can you change how an organization performs?  Absolutely! By changing how individuals perform, leaders can change how the organization performs.

Leaders can change the way individuals perform by:

• Setting clear performance goals.
• Directing, supporting, coaching and delegating where needed.
• Measuring progress and accomplishment.
• Celebrating progress and accomplishment.

These activities, done consistently with a service approach often lead to increased employee performance which almost always affects service quality and commitment which leads to happier customers and growing profits. This is the service profit chain at work.

Changing your organization’s culture is no different from changing how your organization performs. It requires intentional definition of, communication of and accountability for your company’s:

• Purpose: The reason you are in business.
• Deliverables: Your committment to high-quality products and services.
• Culture: Values you stand for and live by daily with stakeholders, peers and customers.

Corporate culture is the most important driver of what happens in organizations, and senior leaders are the most important driver of their organization’s corporate culture.

To change an organization’s culture, leaders must change how they spend their time and what they communicate and reinforce on a daily basis. They have to change what they pay attention to.  Their focus shifts from great performance to great performance WITH great citizenship.

Employee Engagement Equals Success

People who are engaged are more successful, and success helps people engage in their work.

To be engaged, you need to identify with the mission and purpose of your company. You’re great at some things and won’t ever be very good at others. If
you have the materials and equipment you need to do your job right, you’ll care more about the fate of your organization. You are naturally inclined toward
success at some things, and by adding skills, knowledge, and practice, you’ll be much better at them.

To some people, this message seems all too obvious should go without saying.  But you might be surprised at how many people don’t know these things or
haven’t given them much thought.

That’s a shame, and it’s all too common. If everyone knew and understood these secrets — which are more properly called elements of employee engagement
and strengths — they’d be much more successful at everything they do.

Is your organizational culture what you think it is?

In my role I have the opportunity to work with leaders at all levels of all kinds of organizations. About half of my work involves leadership skill building and team process effectiveness; culture for the most part makes up the other half.

It is impossible for me to go into an organization without subconsciously (maybe consciously) assessing the culture of their work environment. I observe and listen for how people are expected to behave, to perform, to treat each other and their customers.

I often hear about practices and philosophies from the leadership that clearly is not in practice within the organization.  And I can say that you need to use a lot of diplomacy to tell the CEO, “I know what you’re saying happens, but it doesn’t happen that way”.  It’s hard to hear that you have tried to build something a specific way and that way is not happening.

Whether an organization has intentionally created their culture or that culture evolved by default, it does have a culture that is tangible and observable. If your culture was created by default, it is likely that unintentional values or norms exist. If you consistently see conflicts,
blame, poor performance, and frustration, your culture is eroding employee morale with every passing minute! Let’s look at two very powerful systems which may reinforce undesirable valued behaviors in your organization.

Rewards and Incentives

Whether you have formalized values and valued behaviors or not, rewards and incentive systems can cause distinct behaviors, some good, some not good. For example, if you desire a team culture but your organization offers only individual compensation, you will likely see “I win, you lose” behaviors by team members.

A few years back a client described the following inappropriate, incentive-driven behaviors by a salesperson. The company paid a very low base; over 70% of sales staff compensation was in the form of commissions. One salesperson negotiated with a few of his big clients to sell
them product at the end of each quarter. The sales person enjoyed commissions on these sales. Then, one month into the new quarter, he would process returns of that product and refund the client’s money. He was generating commissions on “ghost” sales. This went on every quarter. Everyone – the salesperson, the client, the finance team of his company – knew what he was doing and tolerated this behavior. Eventually the company changed the rules about commissions on product returns, but the damage had been done.

 Recognition and Messaging

Every time you publicly celebrate someone for a behavior or action, you are reinforcing that behavior or action. If you recognize a player for goal accomplishment but everyone knows that they’ve taken inappropriate short cuts (for example) to reach that goal, you are reinforcing undesirable actions.

Even praising the RIGHT behavior can have unintended (and undesirable) consequences. One client celebrated a staff member who learned the wrong materials had been shipped to a client. That person packed the right material and drove to the airport just in time for overnight shipment by UPS. Recovery was expensive but the materials arrived on time. The client celebrated this terrific proactive solution and such recoveries became more frequent. The client realized they needed to celebrate solving the “why do we ship the wrong materials?” problem more than celebrating the recovery!

You don’t have to be a CEO to create values clarity in your own workteam. If you experience unintentional values in your workplace, start setting values expectations now.

HR’s true role

I’m always amazed by HR people who are not only great at what they do for organizations and employees, but what they do for the leadership as a whole.  In a recent article by Tim Sacket, he really puts the role of HR in perspective at least for me.  Tim is convinced that it is HR’s job to make sure all departments are working together for one overriding shared goal or sense of purpose. Well, plenty of HR professionals out there would tell you that is management’s role, not HR.   So, should we leave it to the other leaders in the organization?  The problem we face by demanding this of other leadership is they get lost in their own department or groups, individual goals, and have a hard time understanding, or even knowing, what the goals are of the other functional areas of your organization. Someone has to own it, to make it happen – that is where HR can be very valuable.

Malcolm Gladwell wrote an insightful article at the New Yorker called “Connecting the Dots” that looks at a number of historical scenarios in which could have been stopped or changed significantly, if someone would have connected the dots (think 9/11 type scenarios!). Gladwell doesn’t look to place blame, he looks to discover the truth and how, if we get another shot, is a better way to do it all over again. In his article he points out how competing interests, and in an organizations case, and competing groups can cause a failure in connecting the dots that could benefit everyone involved.

Think of a classic HR problem? Some senior leader comes down and is adamant on stopping Turnover (or some other metric they believe will solve all of problems.   Emergency HR meetings take place. SWOT teams are formed. Councils are created. There are No Sacred Cows. Change must happen. They want to see blood in the Hallways. Now.

So, we do stuff. We do stuff that will stop Turnover, or fill critical openings, etc., etc., etc. And it “fixes” the problem.  And, Leadership is Happy. That is until we see the fallout from the changes that were made – and there is always fallout.  It’s a tough organization problem to stop.  Why because it takes leadership that is not willing to go from one extreme to the other every time a problem pops up, and that has strong enough communication and foresight to understand that the dominos they tip over today, will knock over some more tomorrow. But it helps if there is a voice of reason yelling from the back row of the conference room (a brave voice – I might add!). It also helps, if we in HR can lead by example – and stop in our zeal to correct a problem, create more problems for the future.  HR owns the role of connecting the Dots for our organization. Someone has to do it – I pick us. We tend to be the voice of reason anyway, so it fits. But go into this role eyes-wide-open, it won’t make you popular – no one likes a voice of reason when there hell-bent on change, but eventually those will half a head on their shoulders will figure out your value, and that’s more important than popularity!

 

Leaders need competent teams

 If you think of a leader as “the boss”, or “the commander“, standing alone at the head of an organization and running things, the training and development of others in the organization probably doesn’t occur to you as an important function of the leader. But that’s probably an outdated conception of leadership.

If you consider a leader as one who has to rely on the skills and abilities of his or her subordinates, and is responsible for maintaining organizational coherence and effectiveness over time, then it’s easier to see that the development of the team members or people below becomes much more important. Leaders don’t do all the work, or even much of the work in any organization, so their success relies heavily on the skills and abilities of others. An excellent leader in charge of incompetent followers simply can’t succeed.

Given that there are still many people who confuse leadership with commanding, it’s not surprising that many leaders don not pay adequate attention to building the skills and abilities of the people they are leading. In fact, in a study by The Blanchard Companies survey, 59% of respondents cited failure to train and develop staff as a major and common leadership mistake.

The prescriptions are clear. Leaders need to allocate some time to developing their immediate subordinates, and also to create opportunities for learning for others through mentoring, coaching, training, seminar attendance and highlighting best practices in the organization and outside of it. Obviously leaders are not trainers and don’t have a surplus of time, but they can both encourage and arrange for opportunities to learn.

Organizational Culture and Recruiting

It’s one thing to articulate organizational culture, it’s another to live and breathe it.

One of the exciting aspects of being an external business partner is the ability to peer into the inner workings of client organizations. One can almost predict the eventual success of a new employee based on his/her fit within the established culture. When a company “walks the walk” their true working culture matches the messages they send to their internal and external markets.  They will encourage engagement between candidates and many different people within the organization. The search process doesn’t just focus on the group with whom the successful candidate will be working with, but also with those with whom the candidate will need to engage, depend on, persuade, etc. If the company’s true culture is spread throughout the organization, the search process will act as a sieve to not only highlight candidates who can do the job, but those who will fit in and be cultural representatives for the organization. The search process may take a little longer, but the outcomes will likely lead to choosing the right person.