Trust is more than just a social element, it is a powerful force in the business world. So do you know how to systematically develop it?
Trust is the cornerstone of every business relationship and all consumer behaviour. Yet, as important as it is to leaders, companies and brands, it’s notoriously difficult to define.
True management skills should always include a systematic approach to building trust.
Its opaque nature can be a major speed bump for leaders in executive roles looking to effect change in an organisation. So what is trust and how can leaders successfully cultivate it?
Trust is a powerful commercial force
Speaking to the Kellogg School of Management, Faculty Coordinator of The Trust Project Professor Kent Grayson pointed out that when people talk about trust, they tend to think about different things, which can have negative impacts on business relationships.
“We tend to build trust by intuition – in everyday life and in the business world. That usually works OK, especially for experienced business professionals,” he said. “But even seasoned managers who build trust only by intuition may be missing opportunities to leverage trust more effectively – with employees, customers, and business partners.”
Grayson believes that managers and those with leadership qualities should instead take a systematic approach to the act of building trust.
“If you’re a business person, you can’t afford to rely on intuition alone for how you manage trust with your stakeholders,” he argues.
How can you ensure you are building trust with your stakeholders?
Trust has three dimensions
It is generally understood that there are three dimensions of trust. Researchers believe that not only do they ensure the development of relationships, they are also the foundation for all forms of economic exchange.
The three dimensions are:
- Competence. The belief that a person, entity or product has the capabilities to successfully accomplish a job.
- Honesty: The idea that the person you are interacting with will not mislead you or lie about certain matters.
- Compassion: Trust is inherently founded on the belief that the other party (customer, client or partner) has your best interests at heart.
Yet when leaders first meet someone, and their intuition kicks in, they tend to skew how they introduce themselves. French research into trust conditions for instance has shown that managers will over emphasise their capabilities and competence, at the expense of benevolence. Investigators found that this can be a major obstacle to the development of trust.
By introducing a systematic approach to trust, leaders can ensure that they are ticking all three boxes. Without a comprehensive process, and an over reliance on intuition, managers risk failing to develop trust with key stakeholders. As trust is a powerful force in the search for new customers and the deepening of old relationships, failing to address the three dimensions of trust is risky business indeed.
Can we send you an email?
Join more than 5,000 other smart finance professionals by signing up to our newsletter. You'll get a monthly email with new blog posts, job news, views, and insider tips. Don’t miss out on this valuable advice!