Take an all-too-common situation: the executive team is struggling, targets are not being met, absenteeism is at an all-time high, and morale could not be lower. The only reason people are sticking around is the poor job market. The CEO calls a meeting to energise the team and agree on cost-cutting and higher revenue targets. Where are we going to cut heads? Who can drive higher sales? No one around the table says a word. Secretly, everyone is thinking the same thing: “The original targets were mandated with no logic and were totally unachievable. Failure is not an option. Yet here we are again about to experience the same carrot and stick.”
Fear-based cultures are common and costly. They occur when staff are afraid to voice their concerns, or staff that do voice opinions are punished. The result is often lost productivity, high staff turnover, absenteeism, distress and burnout. This often starts at the top and then permeates through the organisation. New ideas rarely surface as they are shot down before they are allowed to get off the starting block. Discretionary effort is non-existent. Staff become very attentive to what the leaders want to hear rather than what is actually the case.
A fear-based culture is one in which leadership is based on implicit or explicit levels of contempt or power among those in positions of influence and those that are required to fall in line. The underlying leadership style is typically a commanding or pace-setting style that is often disguised by complementing this with a ‘visionary’ leadership style.
In data recently analysed from The Resilience Institute in a study of 16,261 people across 250 companies from 2011 to 2014, the results were quite alarming. The data showed that 81% of staff experienced an intense work environment with very concerning levels of worry, chronic stress symptoms, distress and disengagement.
In part, these statistics can be driven by an organisational culture that operates in a fear-based culture rather than one based on trust and empowerment.
The value of trusting relationships
Various studies have postulated that only 50% of staff trust their leaders. Yet trusting relationships in organisations are fundamental to creating a sustainable high-performing organisation. An organisation created with a unit greater than one can only successfully function if there is an egoless relationship in which one individual can engage the skills of another and have confidence that the need will be met. One individual cannot possibly have the expertise or capacity to deliver all the needs of the organisation’s mission.
Trusting relationships are the mechanism for leveraging and aligning the strengths of many individuals towards a common goal. This interaction is not restricted to a traditional ‘top down’ but actually needs to be 360 degrees.
If, over time, the ‘bank account’ of trust between leaders, staff and teams is nurtured, the collective entity is able to achieve higher goals as well as deal with tough situations or challenges. When failure occurs (as happens), they are able to learn from the setback rather than try to hide it or assign blame. When ambiguity exists there is a broader willingness to give the benefit of the doubt.
Building trusting relationships
Many would say that building trust is simply ‘doing what you say you will do’. That is absolutely true. However, this is only one of many components of trust – and any of them can build leadership trust or destroy it. Trust is nurtured by attending to a number of components in an egoless way that is consistent with organisational vision and values. Attention to these components must be consistent over time to incrementally build the bank account of trust.
It is a truism of trust that it takes many positive leadership actions to eventually build trust and only one negative leadership action to destroy all trust.
The key components of trust are shown in the table above. Of these components, there are several that really stand out as major drivers of trust.
Transparency of information
There will always be information that cannot be shared by a leadership team with the organisation for reasons such as privacy, competitive strategy and timing of announcement. However, handled poorly this can lead to distrust and the development of conspiracy theories to fill the absence of information. The trust gap created by the inability to share all information can be bridged by strong communication around what can be communicated and reasons why other information will be released at the appropriate time. Of course, this is all worth naught if there are negative credits in the bank account of trust.
Resolution of conflict
Conflict in organisations and teams is a normal part of business operations that arises due to different opinions and goals and limited resources. Conflict resolution in organisations is often done poorly. As human beings we have a natural tendency to avoid conflict (“I don’t want to upset the other person”), or to be confronting (power-based contempt) and bulldoze through the conflict. A trust-building leadership team welcomes conflict and aims to address it through the lens of compassion, where there are clear boundaries that define success and an empathic conversation around whether and why the boundaries have been honoured or crossed. The outcome is a caring and respectful conversation focused on an outcome for the greater good.
If we were to identify the top five people in the world that we trust, it is likely they would be those we had the strongest personal connection with. Compassionbased leadership seeks to achieve this in an organisational setting. This is a style of leadership in which the leader truly cares about their people and takes the time to understand the broader aspects of their lives and what motivates them. This is not the same as being a friend, which can drive a sympathetic, trust-destroying outcome; rather it’s more about mutual awareness and appreciation.
High-trust cultures in challenging times
The real test of trust happens in challenging times when an organisation is under threat or there is a significant level of growth and transformation. The work that has been done by the leadership team in building a strong bank account of trust in advance will pay dividends, making the difference between a successful journey to sustainable high performance and an organisation that becomes paralysed by its own politics.
Stuart Taylor, the founder and CEO of The Resilience Institute (Australia), works with organisations, leaders and individuals, guiding them from being at the mercy of their environment to reaching a place of calm and optimism where they see opportunity instead of adversity. Working with over 60,000 people globally in the last 10 years, The Resilience Institute’s clients include PwC, Shell and NAB.