Monday, October 22, 2007

The Trust Factor in Leadership that leads to Customer Loyalty

People have an instinctive need to feel in control. Think of the incredible amount of time and energy spent on trying to be in control of thoughts and feelings, other people and their behavior, situations and circumstances, and outcomes and consequences. The need for control -- order, integrity, direction, and continuity -- is obvious. Yet, control does not mean ‘controlling’ the actions of others.

Because an organization is a living entity made up of people, mechanical static structures cannot be imposed effectively. Instead, an organization is in control by virtue of the parts and the people working interdependently and responsibly to achieve commonly agreed results. Said another way, an organization is accountable to people, individuals are accountable to the organization and all aspects of the enterprise are accountable to each other for the integrity of the whole. The operative word here is AND. One of the key concepts of interdependent functioning is that no one area operates at the expense of another, each is an integral and necessary part of the enterprise. Thus, over time an individual’s needs are not met at the expense of the company’s; neither are the company’s needs met at the expense of its people.

No amount of seminars, workshops or restructuring can resolve an underlying problem of an organization that is unwilling to relinquish its total control in favor of mutual accountability. No leader can possibly have all the answers; solutions come from people closest to the action. As such, effective leaders relinquish control and share power. When trust is high, personal responsibility becomes a practical process because persons have access to knowledge and opportunity and are motivated to empower themselves with performance. Cohesive win-win environments cannot be created; they must be nurtured, much like a garden. Although there is life within a seed, the gardener cannot make it grow. Rather, the gardener can select the best seed and create conditions to maximize growth – correct soil, sunshine, water, fertilizer, weeding, cultivation, time. In an organization, two conditions that will enhance a collaborative culture are 1) a communication system that facilitates open, direct interaction and 2) a compensation system that rewards collaboration among employees.

The essence of leadership is to make sure that the organization knows itself and its fundamental principles, and to embody those values. Leaders must be visible and personally engaged in the enterprise, accessible for honest, direct, open communication and be willing to hold the organization accountable to those principles. The leader sets the tone for the quality of relationships within the organization. Because leaders get results through the committed efforts of others, and most people commit themselves to an effort only if they participate in the decision-making process, essential ingredient of an interdependent operation is an atmosphere of trust. Trust must begin with the respect that stems from a belief in the legitimacy of each person in a relationship and a perceived level of fairness. Consensus and mutual agreement does not mean that everybody is 100 percent sold on every course of action. However, it does mean that persons have a real voice and can block a decision that they cannot live with, provided that they present a viable alternative solution. In order for people to commit themselves to the work of an organization, they must trust their leaders and the leaders have to trust their people. Leaders are required to consistently articulate the organization’s core values, reinforce them in words and actions, and hold persons accountable for their parts of the business in accordance with those values.

To be a credible leader, you must develop a deep understanding and appreciation of the values and hopes of the people around you. Leadership is an interactive relationship; a dialogue not a monologue. Leaders become worthy of trust when persons believe that leaders have their best interests at heart. Credible leaders are not afraid to liberate others by giving them latitude to make choices by keeping them informed, by providing resources, and by encouraging risk-taking and learning from mistakes.

“To become a leader, you must become yourself, become the maker of your own life,” observes Warren Bennis. “Until you truly know yourself, strengths and weaknesses, know what you want to do and why you want to do it, you cannot succeed in any but the most superficial sense of the word.” The need for self-reflection is critical to overcome resistance to and fear of change. Who are you? What do you believe in? What do you stand for? To be credible and trustworthy as a leader, you must first clarify your own values. Your competence gives you the skills to turn your ideas into actions. Trust in yourself and your abilities gives you the resolve to pursue a course of action.

Personal growth, as in a garden, must come from the inside out. As such, leaders must focus first on changing themselves before they expand into other areas of influence. Insight alone does not produce change. Personal change is a process that requires us to challenge old ideas and behaviors, to gain awareness and consider new possibilities, and to experiment with new ways of doing things that are congruent with what we really want. Max DePree observes that, “We cannot become what we need to be by remaining what we are.”

Leaders are measured by their behavior. People expect leaders to be accountable for equity, for treating everyone fairly and balancing the needs and interests of the enterprise with the interests of individuals. Trust derives from a serious pursuit by both leaders and followers. It begins with a personal commitment to respect others and to take everyone seriously. It grows when people see leaders translate their personal integrity into actions. Trust derives from truth telling and promise keeping. Our values and moral purpose need to be expressed and demonstrated repeatedly. In an organization, trust depends on the reasonable assumption that leaders can be depended on to do the right thing. The building of trust requires leaders to hold the enterprise accountable. Leaders must demonstrate competence in their jobs, just like everyone else. Earning trust is not easy. It does not happen quickly. Earning trust is difficult demanding work and comes only with genuine effort. True leaders take time to develop the persistence, patience and discipline that will ultimately result in trust. Trust can only be earned slowly, but it can be lost in the blink of an eye. Once we have built it, we should treasure and protect it. When trust permeates an organization, great things are possible, not the least of which is a true opportunity to stretch and reach our potential.

Leaders face the challenge of creating environments in which people will more likely choose to empower themselves. People who know who they are, who have a voice, and who stand for something are extremely compelling. We need and want people who will say, “The emperor has no clothes.” The way to instigate change is to attract people into a risk-taking process, to teach, exemplify and reinforce a willingness to engage in the enterprise. Despite the popularity of the Dilbert phenomenon and the number of people who identify with its message of cynicism, people are hungry for meaning in their work and in their workplace. In a Fortune 500 survey of managers, Gretchen Spreitzer identifies four dimensions of empowerment: a) a sense of meaning, b) a sense of competence, c) a sense of self-determination, and d) a sense of impact. Managers cannot direct people to be entrepreneurial; they can only hope to inspire them to try something new. People understand values and vision by looking at the feet of the people who matter. Obviously, a manager, by virtue of authority and position cannot empower anybody. Individuals must ultimately decide to empower themselves.

Mutually beneficial agreements can create a synergy not possible by either party alone. Such win-win agreements require five distinct areas of mutual understanding:
Desired results (specific identification of what is to be done and when; not how it to be accomplished)
Parameters (guidelines, principles and policies within which results are to be accomplished)
Resources (human, financial, technical, organizational support)
Accountability (standards of performance, measurements, time and methods of evaluation)
Consequences (what will happen as a result of the evaluation – good, bad, natural, logical – give reasons why).

In the final analysis, mutually beneficial agreements, logical processes and objective measurements certainly contribute to a company’s effective operations. However, without trustworthy leaders, who are competent and genuine, business models alone will ultimately fall short. A leader’s personal connectedness provides accessibility that engenders trust and respect. Leaders who are congruent about accountability and honesty, in themselves and others, promote trust throughout an entire organization. Effective leaders are always teaching and learning. When organizations learn collectively to understand the customer, they share responsibility for solving the customers’ problems. When organizations function interdependently and have common understanding of the business, it provides the commitment and discipline that drives the execution of the common business goals.

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