According to Stephen R Covey in his book “The Speed of Trust” Trust can be quantified as follows.
Trust always affects two outcomes- speed and cost. When trust goes down, speed will also go down and costs will go up.
When trust goes up, speed will also go up and costs will go down.
For example in Australia, we used to have a high level of trust in the airline industry. Qantas was the safest airline in the world and terrorism didn’t affect us. Then we had 9/11. Trust went down so we implemented security measures including bag screening, personal security checks etc. Trust went down so speed went down and costs went up.
We sell a car to someone we trust and they simply take the car, we take the cheque with no thought of it bouncing. The buyer does the same; they take the car on face value. The deal can be done in a matter of minutes. When we don’t trust we insist on cash or we wait until the cheque clears, we also take a deposit in case the buyer lets us down. The buyer will pay a mechanic to check the car; he will also pay for a rev’s check to ensure we own the car etc. The deal can take a week or more and the cost of the transaction goes up.
Trust = Speed and Lower cost. Trust is a tangible business tool with tangible results. If we trust our staff, our peers and our leaders then speed goes up and cost’s come down.
So what is trust?
It is a combination of:
Your integrity - Who you are and how you behave.
Your intent - What is your agenda and how do you communicate it.
Your capability - How well do you know your job, training.
Your results - Your track record.
When we combine all of these things we have trust, when we lose one we don’t. For example if I have a great track record for getting things done yet I have a hidden agenda, we don’t have trust. You will question my intent and as such speed comes down.
If I have a high level of integrity and a clear intent yet I have poor capability then we don’t have trust. Think of how much your partner loves you, they may have a high level of integrity and great intent to help you with all their heart. Would you let them operate on you, no you would not because their capabilities are not good enough.
To build trust you start with the individual.
Build their Integrity - Team Management profile, 360 profiles, teambuilding programs that allow each individual to focus inwardly so they worry about what they are doing and not what others are doing. Have them be judged by who they are.
Give them clarity around intent – Define the company Values and engage them in the business plan.
Build their capability - Measure capability and target training to build competence and confidence.
Measure results - Define relevant KPI’s that measure results and reward success.
When we build individual trust we achieve more trustworthy teams and we build a trustworthy business. Trustworthy business has speed and lower costs. They are fast to react and as such take opportunities long before their competitors. Companies with low trust spend most of their time dealing with unions and shifting through the many tenders and contracts that are designed to side step trust.
If you do not believe that trust increases speed and decreases costs, then simple raise your awareness level and ask yourself in each decision you make what effect trust had on speed and cost in that decision.
Trust is the future of effective business, build it or watch other companies build it.