Trust in leadership is critical to enterprise success

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Digital transformation requires organizations to be agile, adaptable, flexible, and scalable. It requires a strategic vision and a collective mindset that is focused on innovation, teamwork, and problem-solving.

But without strong trust among employees in an organization’s leaders, the elements that drive digital transformation can become corroded and ineffective. It’s hard to generate enthusiasm and commitment across an enterprise, after all, if decision-makers aren’t trusted or respected.

Unfortunately, lack of trust in enterprise leadership is rampant. Just “one in three employees in Gallup’s global database strongly agree that they trust the leadership of their organization,” according to the analytics and consulting firm.

“Employees who trust their leadership are twice as likely to say they will be with their company one year from now,” Gallup says. “High-trust organizations also have an enormous advantage in the speed with which any new initiative will take hold.”

While both of those are important, when you think in the context of digital transformation, the latter benefit of a high-trust organization — speed of adoption — is absolutely critical. Conversely, Gallup writes, “When people don’t trust leadership, they’re already planning their exit and have no interest in making a new strategy work or creating new customer initiatives. There’s nothing in it for them; they’ve already mentally checked out.”

It’s clear, then, that trust in leadership is a tangible asset that affects individual and overall enterprise performance, as well as employee turnover. So how can enterprise leaders ensure that they are creating a high-trust organization in which employees place implicit faith in their business goals and strategic initiatives?

If you could order Trust As a Service (TaaS) from a cloud provider, I would recommend that! Alas, it is not so simple, at least for large organizations. There is no doubt, though, that establishing trust must start at the top.

“The true transformation starts with building credibility at the personal level,” writes author and organization consultant Stephen M.R. Covey. “The foundation of trust is your own credibility, and it can be a real differentiator for any leader. A person’s reputation is a direct reflection of their credibility, and it precedes them in any interactions or negotiations they might have. When a leader’s credibility and reputation are high, it enables them to establish trust fast—speed goes up, cost goes down.”

The thing is, the vast majority of employees in a large organization aren’t going to have impressions of their top executives on a “personal level.” As Gallup explains, in large enterprises that have multiple departments and locations, perspectives about top decision-makers can differ dramatically. What’s far more relevant to employees are their direct supervisors.

“Most of the differences in how people perceive organizational leaders across teams within the same organization are determined by how each team perceives its front-line manager,” Gallup says. “Of course, leaders’ consistency, clarity and ethics play a big role — but in large organizations, leaders have minimal direct influence on individual employees.”

Anybody who has worked at an organization where the CEO is brilliant and charismatic, yet their direct supervisor is a jerk, knows how true this is. And that’s because the unpleasantness of their everyday reality outweighs their belief in the CEO or even the organization’s mission. You just want to escape!

Getting back to the question, what can enterprise leaders do to build trust across the organization? Two things:

1) Demonstrate that they themselves are worthy of trust by being ethical, transparent, and competent

2) Develop managers throughout the organization that reflect those values in how they do their own jobs and interact with employees.

“There is a ripple effect in successful organizations,” Gallup writes. “The engagement of leaders extends to the engagement of managers, which then extends to the front line.”

So, yes, be the enterprise leader that can inspire workers to aspire to great things. But recognize that you need to hire and train managers that embody those values and attitudes. Only then will you be able to leverage trust as an asset.

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