If you could define business success, what would it look like to you? Would you focus on market share? Growth rate? Revenue? Profitability? Or something else?
At young companies, conversations tend to revolve around how to raise seed funding, where to invest capital, and how to compensate key contributors. Often, it seems that our perception of business success (or failure) largely revolves around money.
While it is true that a well-run company requires appropriate funding and sound financial management, I would argue that there is something even more vital to the sustained growth of any venture. It’s not something you can buy or sell — nor does it come prepackaged on a shelf.
I’m talking about trust.
Broken Trust: Good Examples Of Bad Behavior
From the Enron debacle to the Madoff scandal, stories of insider trading and fraud have captured headlines far too frequently. Our nation is losing faith in corporate leaders, and there’s a growing demand for corporate accountability and transparency.
The only way to turn this around is for those at the top to take responsibility and lead by example. We must create open, transparent cultures that promote accountability, integrity and honesty.
The truth of the matter is that employees need to know what’s going on in order to feel connected with their work and perform at their highest level. Staff concerns about the stability and the health of the company are a distraction that can erode trust, inhibit productivity and have a negative impact on the bottom line.
Creating an environment of trust goes far beyond releasing quarterly reports. It requires a daily commitment to transparency that’s infused into all aspects of business operations, and reaches all levels of the organizational chart. Most importantly, it requires team coaching and open communication across all functions, with management that listens and responds to constructive criticism.
Trust Is The Cornerstone Of Culture
Leadership legend, Stephen M. R. Covey said:
“High trust is a dividend; when it goes up you’ll find that everything happens faster and cost goes down. It’s that predictable.”
Although trust can take a long time to build, once we have achieved a state of trust, we often take it for granted. But the fact of the matter is that trust is at the core of the daily work activities that collectively make up company culture. As Deborah Mills-Scofield explains in the Harvard Business Review:
“Trust trumps everything. And everything flows from trust — learning, credibility, accountability, a sense of purpose and a mission that makes ‘work’ bigger than oneself.”
When it comes to trust, the whole is bigger than the sum of its parts. For example, many startups have created cultures based around staff perks like a ‘no vacation policy’ vacation policy, providing employees with top-of-the line equipment, offering flexible hours, and letting staff work from home. While benefits like these may attract and retain top talent, there’s also a higher mission. Companies that offer these unique self-directed work options are sending employees a message that says, ‘I trust you, and I trust your judgment in using these privileges.”
Earlier this year, HubSpot released its long-awaited Culture Code – a presentation that summarizes the organization’s nine core beliefs. The document is remarkable because it emphasizes that trust is at the center of Hubspot’s organization. Rather than creating binders full of company policies, HubSpot has created a simple three-word policy for nearly everything: use. good. judgment. From social media activity, to travel expenses, to sick days, HubSpot understands that a healthy company starts with trust.
The Trust/Time Ratio
Of course, trust is a two-way street. Not only is it essential for employees to trust management, but leaders must trust their teams, and feel confident in their ability to move the company forward.
As Stephen M.R. Covey explains in his book, The Speed of Trust, trust is the great liberator of time and resources. It’s also an essential condition for growth. He notes that “when trust goes up, speed will also go up and cost will go down,” and that “when trust goes down, speed will go down and costs will go up.” Therefore, he concludes that the speed at which you can grow a business is directly proportionate to the time that you invest in creating trusting relationships.
Leading By Letting Go
One of the most important lessons I learned as a CEO was the importance of trusting your team. As the leader of any organization, large or small, your primary job is to communicate the vision; give your people the information, tools and resources to move toward it; and then get out of the way. This frees your staff to be as productive as possible, while allowing you to focus on your responsibility to drive the company forward, strategically.
The truth is plain and simple: if you’re a leader who wants to grow a company, you must have faith in your staff to get the job done – without you hovering around their desks. It is impossible to innovate while being bogged down in the daily minutia of your company. Trust allows you to remove yourself from the details and create necessary space to focus on long-term growth.
Trust is a natural human instinct, yet we tend to over-complicate it when we try to apply it to the business world. The best way to create a culture of trust is to begin by being open and honest with ourselves and those around us. By committing to being transparent in all our interactions, we will gradually create a culture of trust around us. And as trust grows, we should expect to see business results follow.
How do create and sustain trust within your organization? What results do you see?
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