Why Trust Matters
In the office in which I work there are five people of whom I am afraid. Each of these five people is afraid of four people (excluding overlaps), for a total of twenty, and each of these twenty people is afraid of six people, making a total of one hundred and twenty people who are feared by at least one person. Each of these one hundred and twenty people is afraid of the other one hundred and nineteen, and all of these one hundred and forty-five people are afraid of the twelve men at the top who helped found and build the company and now own and direct it.[1]
So begins the chapter “The Office in Which I Work” in Joseph Heller's classic book, Something Happened. I begin this chapter with Heller's words not because they necessarily reflect everyday work life today (although they do for some people and ring true, at least in part, for many others). Rather, I begin this chapter with Heller's words because they illustrate the fundamental importance of trust in our lives.
Why is trust so important to human beings? We need trust because we must live in a complex world that we cannot fully understand, depend on people whom we can never completely know, and rely on organizations that do not exist for the sole purpose of meeting our personal needs. Therefore, we must rely on trust—essentially a leap of faith—that “some things will remain as they are or ought to be,”[2] that other people will not take unfair advantage of us,[3] and that we will not be harmed by the organizations in which we invest our future. In short, trust helps us face the inevitable risks of everyday life so that we can rise above our fears, take productive action, and experience tranquillity and happiness.
Despite the importance of trust in everyday work life, many managers see it as a luxury rather than a necessity. In her study of new managers, Harvard professor Linda Hill found that “most new managers put their efforts into demonstrating their technical competence” rather than building trust. One of the managers in her study explained:
The first thirty days were critical...I had to demonstrate that I had ability. I kept looking for a big win, picking the right stock, stealing a big producer from the competition. I had to demonstrate that I worked hard. I stayed late and came in on weekends. It was hard to get relief from the pressure of it all.
However, Hill found that subordinates “were making judgments using a different set of standards. They wanted to find out if the new manager deserved their trust and respect. Staff members were clearly sizing up the new boss—and their criteria weren't always fair.” By emphasizing their technical competence and ignoring trust-building activities, managers often “missed opportunities for building goodwill among their subordinates, just when they needed it most.”[4]
Not surprisingly, managers who inspire trust—both in themselves and in the organization—tend to be more effective, have stronger networks, get more challenging job assignments, and get promoted more often than those who don't inspire trust.[5] Specifically, they are better able to:
Attract and retain followers because employees prefer to work with people who they believe are trustworthy.
Promote a sense of belonging because employees are more likely to identify with organizational goals and values, invest psychologically in their jobs, and feel pride, loyalty, and affection toward their managers and organizations.[6]
Build support for their goals because employees who trust their managers are less likely to question managers' competence, goodwill, direction, and intentions.[7]
Develop more productive employees because people in trusting relationships tend to exhibit increased emotional stability, self-control, creativity, and flexibility as well as less stress and defensiveness.[8]
Inspire employees to go “beyond the call of duty” and contribute to the organization in ways that add value but that are not in their job descriptions.[9]
Focus on value-added work because they do not need costly employee control systems that can consume both managers' and employees' time, distract them from focusing on fundamental work objectives,[10] and reduce innovation and cooperation.[11]
Enhance communication because employees are more likely to speak openly and honestly, listen carefully, and give bad news upward if they trust the boss.[12]
Increase the “speed and efficiency in the creation and transfer of knowledge” because employees are more willing to cooperate with each other in the sharing of information.[13]
Reduce conflict and the costs of negotiation because employees are more likely to give each other the benefit of the doubt and be open-minded, flexible, and willing to be influenced by each other.[14]
Have more effective group decision-making processes because group members feel free to focus on organizational tasks and goals rather than defend themselves from what they perceive to be threatening. Some researchers have concluded that members of low-trust groups are more likely to have difficulty concentrating on their tasks; are more likely to engage in self-protecting and low-risk behaviors; have more difficulty dealing with uncertainty; are less able to accurately interpret the words, motives, values, and emotions of others; are less likely to accept each other's ideas; and are less likely to support and implement the ideas of their leaders.[15]
Promote organizational change because employees are more likely to feel secure, be flexible, take risks, and cope productively with complexity, ambiguity, and uncertainty.[16]
Survive organizational crises because they are more likely to receive undistorted information from employees, enable decentralized decision-making that allows employees to react quickly to crises, and encourage collaboration with and across organizations affected by the crisis.[17]
Help employees accept unfavorable information and decisions that adversely affect them because employees who trust their managers are more likely to assume that their managers did the best that they could under the circumstances, were fair in their decision-making process, and will do whatever it takes to turn the situation around. The more unfavorable and unexpected the situation, the more important trust becomes.[18]
For all of these reasons, trust has been called a “social lubricant,”[19] “invisible asset,”[20] “collaborative capital,”[21] “hidden source of wealth,”[22] and the “heart of relationships.”[23] Rather than being a nice-to-have luxury, trust in organizations is increasingly being viewed as a source of competitive advantage. This is because high-quality relationships—those built on trust—provide economic value to the organization, take a long time to develop, and cannot be easily copied by other organizations.[24]
In a Wall Street Journal interview, Herb Kelleher, founder and CEO of Southwest Airlines, explains:
The intangibles are more important than the tangibles. Someone can go out and buy airplanes from Boeing and ticket counters, but they can't buy our culture, our esprit de corps... We've had people come in to see how we turn around planes. (Southwest's time to get planes in and out of gates is about half the industry average.) They keep looking for gimmicks, special equipment. It's just a bunch of people knocking themselves out.[25]
Trust is a particularly important competitive advantage for companies that try to sell products and services on-line. An article in Marketing Management magazine cites several studies that highlight the importance of building trust on-line:
A survey by the Georgia Institute of Technology found that only 4 percent of on-line users routinely register at Web sites. The “Tenth WWW User Survey” found that two-thirds of those not registering at some sites report a lack of trust as one of their reasons. A telephone survey, “Worldwide Internet Tracking Study,” conducted by the IntelliQuest Internet research firm found that in the first quarter of 1999, 63 percent of on-line users reported that they hesitate to buy for fear of unwanted junk e-mail, up nearly 10 percent from a similar poll just 6 months earlier. These Web users will become buyers only when marketers overcome the lack of trust that paralyzes would-be shoppers.[26]