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Silicon Valley-San Jose Business Journal

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THE BUSINESS JOURNAL, December 13, 2002

In good times and bad, effective leadership begins with trust

Photo of Arky CiancuttiBy Arthur Ciancutti

Trust is a commodity that all employees want. And earned trust is the least expensive, most productive investment a leadership team can make. The returns are immense, immediate and long term.

If you believe that an economic downturn is a time to build infrastructure and position, this may be the time to expand that trust investment in your organization.

Trust means confidence, the absence of suspicion, backed by a performance track record.

Trust is simple, but it is difficult for many. There are two difficulties, and leaders must understand both. First, one must understand that virtually every individual carries some "trust baggage."

This consists of past perceived betrayal experiences that have resulted in "never again" categorical decisions and defensive blind spots.

We are ready to be suspicious. An economic downturn, with its concomitant feel of scarcity, makes this propensity to suspicion even more labile.

A second obstacle can be lack of courage. For some leaders, it takes courage even to broach a subject as "soft" as trust, let alone ask for the help necessary to bolster and maintain it. But these obstacles obscure a lot of upside: The payoffs are almost immediate.

People have natural inclinations to be productive and be part of something bigger, especially something that reflects ones inherent values of success.

But what's opposing the urge to contribute is fear—of failure, loss, retribution or embarrassment.

There is an almost daily balance between these two influences: the desire to take positive initiative, and the fears of negative consequence. Whether by active intention or simple neglect, leaders exert a primary influence on this balance. And the effects on productivity can be profound.

In a down economy, company leadership is vulnerable to missing opportunities. Doing nothing active to establish and maintain trust within the organization is the first missed opportunity. Bad news, for example, is best communicated proactively. Business decisions made necessary by bad news are best explained fully to the company. When these communications do not emanate from highest management, or happen late, the information vacuum combines with fear. This almost always results in rumors, innuendoes and exaggerations which produce more fear, which results in decreased workplace productivity.

A second miscue would be leadership's failure to exemplify trust vigorously and continuously. Earned trust must not only be established, it has to be maintained. How often do business leaders respond to everyday questions and cross-functional dependencies by making promises? To what extent does the perceived track record support this?

When corporate scandals suggest that some management teams are willing to profit at their employees' expense, does leadership here share the pain? Like it or not, the most valuable stakeholders are watching, and they care.

Either of these missed opportunities can tip the workplace contribution-paralysis scale far to the unproductive side. This results in a "toxic coffee room buzz"—bonding around problems rather than solutions; poorer coordination, such as product development versus sales and marketing versus corporate; more risk-aversion (working to not fail rather than working to excel); and overall diminished productivity.

The third common missed opportunity is leadership's failure to take a strong-enough initiative on a simple truism: People are willing to trust more quickly when principles that promote trust—behavior guidelines that clearly aid productivity which can be tracked—have been explicitly and universally adopted by the management team. Rank-and-file workers are willing to continue that trust for as long as people's behavior, particularly the behavior of key leaders, is consistent with those principles.

Provisional trust, confirmed by the experience of greater productivity and satisfaction, then deepens into institutional trust.

There is a lot of fear during an economic downturn.

These fears add weight when people stand between positive action and the fears already inherent in making those positive contributions.

Earned trust tips that balance predictability toward initiative and accountability.

ARKY CIANCUTTI is the founder and chief executive office of Learning Center, Inc. (www.learningcenter.net) a leadership training and consulting company in Mendocino.

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