The Risk of a Trust Deficiency

Norman Marks, CRMA, CPA, is a vice president for SAP and has been a chief audit executive and chief risk officer at major global corporations for more than 20 years.

 

I recently wrote a post, Are you, your organization, and its leaders trusted? I discussed the need for trust if you are going to be successful, whether as an individual leader, an executive team, or an organization.

But the comments in the post and on LinkedIn were generally disappointing (with some notable exceptions).

The point is that not only is trust a critical ingredient to success, but a trust deficiency is a hidden killer. It’s a poison within the organization that will, over time, erode its chances for success.

I quoted a Watson Wyatt study that reported that less than 40% of employees had “trust and confidence in their senior leaders.”

I also quoted a Gallup report that found that “employees don’t leave companies, they leave managers and supervisors. People leave because they are not respected, listened to, appreciated, or cared about”.

In my experience, most leaders and organizations have trust deficiencies but don’t know it.

In my post, I provided advice for individual leaders, board members, and the executive leadership team.

Let me add, here, advice for risk and assurance professionals:

  • Recognize that where there is a trust deficiency there is a high risk of failure.

  • When individuals don’t trust their leaders, they put their personal interests ahead of their manager’s, team’s, and organization’s — with obvious consequences.

  • Rather than just acknowledging that a trust deficiency may exist, consider whether you and your team can help the organization understand it, assess its implications, and take action to address the deficiency — continuing thereafter to monitor and maintain trust levels.

  • We are not doing our job if we ignore this as an issue.

When you, as a risk or assurance professional, just say “trust is issue, so I will audit around it” you are perpetuating the problem and not helping to fix it. In fact, you are now part of the problem!

 

Don’t just watch, act!

Posted on Jan 3, 2013 by Norman Marks

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  1. An easy way to diagnose this is by administering a culture survey to the C-suite, then to the workforce at large, and comparing the scores.  Typically the differences will open some C-suite eyes. 

    I've certainly seen this anecdotally but for doubters, if I recall correctly, LRN's "HOW Report" has some striking findings about how the C-Suite feels about company culture versus how rank and file employees perceive it.  As Robt Burns put it, "O wad some Pow'r the giftie gie us, To see oursels as ithers see us!"

  1. Scott, thanks for the comment.

    Do you think the survey is sufficient? Will it identify these issues?

    • A lack of trust by the CEO of his executives
    • By the executives of the CEO
    • By the executives of each other
    • By business leaders of IT
    • By customers, partners, and vendors of the business
    • Of you by your staff
    • Of you by your peers
    • By and among mid-management
    • Of HR

    I think the greatest technique to identify the problem of a trust deficiency is simply to open our minds to see and understand what we already know.

    Your thoughts?

  1. I think that was just the reason I left my job and also the reason for leaving the current one, although it seems much better this time. Last time, I cannot really feel cared about, especially while meeting some problems, some of my colleagues even asked me to sacrifice myself for the organization's benefits without the feeling of shame in front of others (including outsiders). Therefore, I quited soon after that.  Actually that was a great and creative company and some of my colleagues are very nice, but most of them are foreigners. And now I still meet this kind of problem, I admit that has been already becoming much better,? but I know I could have better one, just feel most of my colleagues are very nice, both Chinese ones and foreigner ones, but I just feel something bad from the upper. Therefore, I am still wondering...

  1. I had to go back and read your initial post, which I missed when it came out.  I'm surprised to find no mention that trust, like respect, is not given but earned.  I'm also surprised to find little discussion on how trust could be measured -- I'm afraid the short survey you have above would not be sufficient.  One possibility is to relate trust to employee engagement, and Gallop has quite a bit on measuring that.  It does make sense that there would be a positive correlation between trust and engagement.

    The difficulty is that senior management has to keep certain decisions closely held, such as personnel issues, market strategy, M&A activity, litigation issues, etc.  These decisions are made by senior executives, usually in closed-door deliberations, and are not open to review and disclosure by the rank and file employees.  Trust requires openness, but full openness is sometimes bad for business.  Hence the typical conflict between management and employee.  What can help is if management is candid about the need for confidentiality in some situations -- it might seem to be common sense, but it is far less than common for it to occur.

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