This is the first in a four-part series on Trust and its impact in and for an organisation.
Let’s be clear – At Imaginal, we believe that Trust is the foundation, for all true, authentic relationships both personal and professional. It is essential, fundamental.
From Imaginal’s perspective, Trust is a crucial element in an organisation because the level of Trust that exists creates the climate within it. In other words, the environment or atmosphere in which people work is the result of the level of Trust that exists within an organisation.
The level of Trust that exists within an organisation has a direct relationship on the impact it makes, internally and externally. The level of Trust will either increase or decrease its impact. The level of Trust will either increase or decrease the business’s speed, impact and its people’s ability to thrive.
If levels of Trust are high, the climate is one that is positive, people work well together, and support each other, resulting in high levels of engagement, creativity, innovation, and commitment. If the levels of Trust are low, the climate can quickly degenerate into being toxic and blame and fear are prevalent.
In a time of economic uncertainty, unprecedented change, and chaos as is experienced today, Trust is one of the most important areas on which leaders can focus.
Trust is an integral, essential, and fundamental part of creating foundations for a successful and sustainable organisation.
The Link between Trust and the Bottom Line
Many leaders believe that Trust is a “soft requirement”. This could not be further from the truth.
Studies have revealed there is a direct correlation between businesses that have high levels of Trust and their commercial returns. The findings have been observed at an international level.
One trusted source (pun intended) that confirms this is the Great Place to Work®Institute which has studied workplace culture for over 30 years. The Business Case for a High-Trust Culture¹, which took four years to complete, provides deep insights into how Trust impacts all aspects of a business’s performance.
The opening statement in the Executive Summary of their report states – “There is a strong connection between a high-trust culture and business success. In fact, the connection is so strong that strategy-minded leaders, who care deeply about the financial well-being of their business, should make building a high-trust culture a top priority.”
And Alex Edmans, Professor Finance, London Business School, who played a key role in the research, states “All companies that make the Best Workplaces list, internationally, have one key element in common: high-trust cultures. Great Place to Work® global research shows that both in the U.S. and internationally, these trust-based cultures lead to impressive performance records.
“Great Place to Work has consistently found that companies with the highest levels of trust outperform industry peers on metrics including employee cooperation, productivity, retention and growth.”
Impacts of Trust on a business
Bearing all of this in mind, here are just a few of the impacts that positive levels of Trust have on a business.
- Improved employee morale leading to decreased employee turnover, business attracts the best, engages, inspires, and retains them.
- Increased collaboration, creativity and innovation result in new products/services being developed and the building of assets are improved and increased.
- Faster decision-making leading to more efficient and effective choices.
- Client perception of the organisation is positively impacted evidenced in increased client loyalty and retention
- Maintain a competitive market position leading to increased profits.
What does it take to build Trust in an organisation?
At Imaginal we have found that building Trust within an organisation is a conscious choice the Leadership Team needs to make. It is not something that can happen organically and in an unplanned way.
In the following articles we will look at What is Trust? What prevents Trust from built and How to build and measure Trust in an Organisation.
¹Business Case for a High Trust Culture (pdf)
