The events of late 2001 sent a tsunami over the collective psyche and economy in the United States and around the world. The most noticeable impact of this shock wave is that many people feel psychologically uncertain about the future. They are searching for dependability and reliability for their futures. Everyone wants and needs to feel a sense of trust about the stability of the people around them and the institutions for which they work. For many, the twin threats of terrorism and economic downturn have resulted in paralyzing fear and formless anxiety.
Businesses are not immune to this impact, since collectively, businesses are the sums of the people and communities they serve. Leaders must feel this uncertainty as they look to the future and plan for the next upswing in the business cycle. With their capital reserves low and profits razor thin, they are struggling to come up with the magic formula to help them capitalize on the next big wave in the business cycle. They fear that even with interest rates in the United States at their lowest point in more than forty years, pouring capital into redundant infrastructure or product research may not be the best business strategy. Given these fears and uncertainties, it is a good time for leaders to be introspective, listen to those around them, and correctly decipher the clues people are offering in order to be prepared for the next upturn in the business cycle.
Those clues are based on the timeless human instinct that tells us during periods of uncertainty, we must band together and form mutually beneficial partnerships and alliances with others. Smart leaders can depend on these alliances to support their business objectives and help satisfy their customers’ needs. Partnering allows businesses to concentrate on their core business competencies, positioning themselves alongside others to provide the additional infrastructure and product development needed to satisfy customers while limiting unilateral risk and maximizing the resources of everyone involved.
To fully engage in this strategy with external business partnerships, leaders must first commit to building the highest possible level of trust within their own organizations. What unsuccessful leaders fail to realize, until it’s too late, is that they cannot build purposeful strategic alliances with others when there is a lack of trust and partnership at all levels within their own organizations. Like animals smelling fear, others intuitively know when your organization has internal trust issues. They tend to avoid the risk of developing a close relationship with a potentially volatile partner. Internal lack of trust can result in an organization’s inability to attract the most qualified partners that set up the circumstances for productive alliances.
What steps can leaders take to begin building trust in their organizations?
First, leaders can assess the current level of trust within their organizations. A trust survey can accomplish this simple starting point and yield valuable information about how to proceed. Leaders can also use the initial trust survey as the benchmark for their efforts to improve trust.
Second, leaders need to establish what trust means to their employees. What does trust “look like” in operation and how do people know when it exists? They may be surprised to find that employees are ingenious in the numerous ways they test the level of organizational trust. Once leaders understand what trust means, they must learn how to instill it into the culture. Amazingly, we find there are always a few simple steps to improve trust quickly and substantially.
For instance, one of the clients of the Partnership Continuum performed a trust survey and used it to institute a trust building initiative. The Principals in this organization found that people simply wanted to know the truth about the state of the business without having the information sugarcoated and spun. The employees knew that the economy was down and they could see that the level of business was dropping. They didn’t want their leaders telling them everything was “fine” when they knew better. Once the leaders understood that they had to tell the truth about the state of the business, trust improved almost instantly and the employees started to pour in suggestions of ways to save money and make improvements on productivity. Smart leaders do not underestimate the resourcefulness and good will of their employees because they probably know as much, if not more, about the state of the business than the leaders themselves. In this example, the trust built by the leaders resulted in the employees improving the profitability of the business during very challenging economic times.
Third, good leaders measure trust and make it an important corporate indicator. They talk about it, keep it in the forefront of people’s minds and ears, and make it an issue. In return, they will be surprised at the results they get. While some will argue it is difficult to measure trust, that isn’t true in practice. A simple question such as, “Do you feel trust in this organization?” speaks volumes and when measured repeatedly over time and can provide insights into the trends of whether trust is growing or diminishing in the organization.
With capital reserves low, profits thin, and people anxious about the future, building trust is the essential strategy for businesses in 2002. Smart leaders understand that strategic alliances and partnerships are a key component to increase infrastructure, enhance capability, and maximize product development and distribution. Outsourcing is an increasingly popular partnering strategy that allows organizations to re-focus their energy on core business competencies while letting others provide enabling services cheaper and more efficiently. Having the cultural capabilities to enhance partnering opportunities is an essential organizational competency.
Internal trust in an organization is a proven critical success factor for establishing reliable strategic partners externally. If you can’t build trust internally, how can you expect to build it externally? Building internal trust in 2002 should be the key element in every business’s strategic plan to take advantage of the next big business upturn that will ultimately occur.
Stephen M. Dent, founding partner of the consulting firm Partnership Continuum, Inc., is an award-winning organizational consultant working with such clients as USWEST, Inc. Northwest Airlines, AT&T, GE Capital Services, the U.S. Postal Service, NASA, Bank of America and Exult. He lives in Minneapolis MN.
Stephen M. Dent
Partnership Continuum, Inc. www.partneringintelligence.com
1201 Yale Place Suite 1908
Minneapolis, MN
e-mail Sdent@partneringintelligence.com phone 612.375.0323
