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25 Warning Signs You Have a Low-Trust Organization: Part 5 of 5

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If your customers and clients tell you they don’t trust you, things have gotten bad. But you could have seen it coming. There were many early-warning signs of low trust in your organization.

This is the last in a series of five. The other posts address warning signs of low-trust organizations coming from:

How Your Clients and Customers Tell You You’re Low-Trust

It’s almost inconceivable that a high-trust organization will have low-trust relationships with its clients or customers. And that works in reverse: low-trust buyer relationships are a tip-off that something is amiss internally as well. Sometimes it’s easier to read the external signals, so here they are:

1.    Your colleagues speak disparagingly of your customers.

  • “They’re trying to pull a fast one on us; we can’t let them get away with it.” Whoa, simmer down. People who ascribe negative motives to customers’ actions without data, will generally do the same within the organization.  With all due respect to Andy Grove, paranoia is rarely a good corporate value to promote.
  • “I’ll believe it when I get it in writing.” If your people insist on contractual, legalistic relationships with customers, they’ll do the same internally. And since trust greatly reduces time and costs, that attitude is costing you dearly, internally as well as externally.

2.    You haven’t gotten a new referral client in 6 months.

  • This is such a key concept that it has been quantitatively refined (brilliantly) in the Net Promoter Score first developed by Bain’s Reichheld and Markey. At its heart: the single metric that best correlates with success is your clients’ tendency to promote you.
  • If you have great referrals, you almost certainly have delighted customers and energized employees. And that rarely happens without great levels of trust within the organization.

3.    You’re losing customers and don’t really know why.

  • Look at your customer list: is it basically growing or shrinking? Come on, you know the answer, pick one.
  • Now ask yourself: do I really know why that is? Or do I have a list of anecdotal, seemingly unrelated reasons? The CEO left; that guy’s a complete jerk; they decided to go with the low-price provider; they’re rationalizing suppliers.
  • That is not an unrelated list, after all. The common denominator is, they don’t trust you. And if your customers don’t trust you, the odds are remote that you live in a high-trust organization.

4.    You’re being asked to submit bids and respond to RFPs for long-time clients.

  • We don’t want to be dogmatic about this one: there is a long-term, secular trend toward professional procurement. That trend is not Evil incarnate; the procurement people are your new clients. Treat them as such, respectfully.
  • However: if YourCo seems to be singled out for this treatment, if it’s not a slow trend but a landslide for you, then maybe the market is telling you something. It’s telling you you’re not trusted. If you were trusted, you’d be seeing many fewer RFPs, you’d be getting sole-sourced where reasonable, you’d be getting in to define some RFPs, and you’d be getting some very personal coaching from the customer about how to operate in the new procurement world.
  • That’s not happening? Then odds are, your customers don’t trust you. They’ve never been shown the difference between genuine concern and manipulation. They’d prefer to deal at arms-length, with professional buyers who are immune to emotional bullying and enticement alike. They prefer to deal on price, because they haven’t been shown any good reason to deal on any other basis.
  • And if you’re quoting on price, using self-oriented sales tactics with your customers, then you probably don’t respect your own products, value and organization. Sounds like low-trust.

We hope you’ve enjoyed this little series on warning signs of a low-trust organization. Writing it has reminded us of two things:

1.    Trust is infectious. A high-trust organization is highly correlated with high performance on so many dimensions: innovation, people, leadership, products, and markets.

2.    Trust begins at home. Correlation is not causality, but causality is clearly at work in trust. Furthermore, it flows more in certain ways than in others. In very broad terms, the five factors we’ve discussed move in the following manner to create a high-trust organization.

It generally starts with leadership; but that’s a different series for another time.

 

25 Warning Signs You Have a Low-Trust Organization: Part 3 of 5

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Low-trust organizations can be spotted in many ways.  This is third in a series of five. In this one, we explore warning signs from leadership. Previous and future posts address warning signs from:

  • Employees
  • Teams
  • Leadership (today’s post)
  • Products and Services
  • Clients and Customers

Leadership Warning Signs of a Low-Trust Organization

Look at the leadership in your organization. Does it have some of the following characteristics? If you’re a leader yourself, think hard, you might be contributing to a low-trust organization. These issues all arise from leadership choices, after all.

1. The Cult of the Corner Office thrives.

  • Do you have corner offices that are not conference rooms? Do they come with extra appointments, more square footage, better desks? Are there criteria for who gets them? You may have an issue.
  • If you have sanctified real estate, the odds are you have other visible symbols of class status and rank. With one exception, class systems detract from trusted relationships in an organization.
  • The exception: you’re intentionally running a business that connects meritocracy and materialism. Some trading operations fit that description. But you’re not likely to confuse them with high trust environments anyway.

2. The highest performer is a values-offender.

  • Name the 2-3 smartest, highest-bonus, most successful persons in your organization.  Does at least one of them get there by thumbing his or her nose at your avowed corporate values? Then you have a problem.
  • Values mean nothing if they are not enforced. Very few values statements have exceptions clauses (“…unless you can make a really profitable sale..”). What part of “team player,” “integrity,” or “client-focused” do you think rhymes with not showing up at team events, obfuscation, or self-aggrandizing?
  • Nothing shoots holes in values statements like blatant hypocrisy.

3. Blame is an art form.

  • Blame is the opposite of responsibility. If leadership means anything, it means taking responsibility. If the first words out of leaders’ mouths in the face of difficulty are to blame the situation or another person, what you have is the absence of leadership.
  • Don’t confuse an explanation with an excuse. Explanations are important; they help us know what to do differently next time. They do not, however, let anyone off the hook. Leaders can’t be let off the hook; that’s part of the definition of leadership.
  • Blame and its twin “inability to confront” corrode trust. They both try to disconnect responsibility from the truth. Leaders don’t do that.

4. “Need to know” is your catchphrase – and you’re not in the military.

  • The military, and military contractors, legitimately operate on a “need to know” basis. Not too many others do. It’s an easy rationalization that leads to low trust.
  • If I say you don’t need to know something (outside the military), it means you can’t be trusted with the information. Maybe you’re incompetent, maybe you’re a blabbermouth, maybe you’ll misinterpret it; there can be many reasons for low trust. But they’re all low trust.
  • If I don’t understand or accept why I have no need to know, then I will resent you telling me. Resentment leads to all kinds of avenues, none of them good, and all of them low-trust at heart. Need-to-know erodes trust.
  • None of them above is any different because it’s a policy: a policy to withhold the truth systemically just means you have a systemic approach to withholding the truth. Now you have a whole organization that is untrusting.

5. The need to “have a positive outlook” trumps the need to tell the truth.

  • Many a leader has said, “We need to keep people’s morale up, make sure they hear this the right way, don’t let them get depressed.” That way lies trouble. Because the truth has a way of getting out.
    • Most people in most situations would prefer to hear the truth, to make up their own minds. They don’t trust people who assume they know better.  Remember Colonel Jessup in A Few Good Men, yelling, “The truth! You can’t handle the truth!” Don’t be that guy.

In the next post, we’ll explore 5 ways in which products and services can indicate a low-trust organization.

25 Warning Signs You Have a Low-Trust Organization: Part 2 of 5

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It’s not impossible to find a high-trust team in a low-trust organization – we’ve seen a few – but not too many. For the most part, low-trust organizations are made up of low-trust teams.

This is the second in a series of five, totaling 25 warnings signs in:

Team Warning Signs of a Low-Trust Organization

Look around the teams in your environment. Do they have some of these characteristics? Then you might be a member of a low-trust organization.

1. A low-trust team isn’t productive.

  • It misses milestones. It doesn’t deliver on time, or on spec. The team doesn’t do what it says it will do. The team is unreliable.
  • It produces mediocre work. It settles for what looks to be low risk, getting the lowest common denominator. It chokes off innovation in the name of risk, often masking jealousy and NIH (not invented here) Syndrome.
  • It fails to achieve its goals. Goal failure is more than milestone failure writ large. It speaks to a failure of common purpose and common commitment.

2. Low-trust teams typically form sub-groups and cliques within them.

  • There are flurries of private emails and hushed conversations. This is sub-team bonding, not even tribal – it is transient, shallow, and superficial – Mean Girls bonding.
  • Team members are guarded in their communications. They are concerned someone else might hear, and that would be in principle a bad thing. It’s the ‘in principle’ part that’s worrisome.
  • Information is hoarded as a source of political power, rather than shared to create greater team power and organizational success.

3. Low-trust teams are less than the sum of their parts.

  • A great team – even a just pretty good team – can accomplish so much more than simply the sum of its parts. But a low-trust team can’t.
  • They choke off innovation and personal growth – things that happen organically even in a neutral, social organization. A low-trust team isn’t benign, it’s toxic.
  • People are massively influenced by those around them – a group of low-trust people can bring even a strong team player down to their level of low trust.
  • If the team is bureaucratically protected from competition, it will have low turnover among a core group and high turnover from the occasional newcomer. If the team is in a competitive environment, it will show high turnover everywhere. No one likes staying.

4. A low trust team is addicted to faux team-ness, happy talk, not real team walk.

  • We can’t prove this, but we sometimes wonder if the presence of those motivational posters isn’t negatively correlated with team behavior (or is that just us being cynical?)
  • Lip service is the coin of the realm, because to be honest would be to acknowledge the existence of low trust. Honesty is what distinguishes a merely critical team from a low-trust team; the latter is disengaged.
  • The opposite of low-trust teams isn’t competitive, meritocratic teams; it is teams who know enough to wish they were trust-based, and try to pretend to appear so.
  • There is frequently a high-performer, one who achieves great results but does not follow the values. This manifest unfairness results in resentment among the rest of the team.

5. A low-trust team has trouble collaborating.

  • Low-trust teams are likely to prefer individual compensation schemes; they don’t believe in, or trust, the ability of the team to do well for them, preferring to fend for themselves.
  • Collaboration drives innovation; but low-trust teams exalt solo work, thus buying into the “solo inventor” myth of innovation.

If teams in your ecosphere look like this, you may be hanging around a low-trust organization.

For some ideas on how to improve trust, see Three Strategies to Improve Business’s Trust.

In the next post we’ll explore Five Warning Signs in Leadership that suggest a low-trust organization.

 

25 Warning Signs You Have a Low-Trust Organization: Part 1 of 5

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Low-trust organizations are petri dishes for low growth, profitability, and ultimately survival. Yet the signals are easy to ignore.

The canaries in the low-trust coal mine fall into five groups: we’ll devote one blog post to each of:

  • Employees (today’s post)
  • Teams
  • Leadership
  • Products and Services
  • Clients and Customers

Employee Warning Signs of a Low-Trust Organization

Look around your offices. Do you see the following five signs? Then you might be a member of a low-trust organization.

1. The copy room bulletin board has those round smiley cartoon figures laughing and rolling on the floor saying, “You want it WHEN?!”

    • Humor is revealing. This particular cartoon pokes fun at the internal customer. Allegedly. When is it a good idea to make jokes about the customer?
    • What it really indicates is insecurity on the part of the copy room staff. What it really says is, “Please don’t blame me, I feel un-validated around here. And besides, all I want is to follow simple rules that I don’t have to think about, why are you making my life so miserable with all your requests?”
    • And when you see those cartoons, it isn’t just about the copy room. They’re a canary in the company mine. It means you’ve got insecure employees reporting to people who can’t give clear feedback, and a culture of entitlement. Good luck trying to get things done around that place.

2. People email others on the same floor way more than they talk to each other.

    • Sure, email provides an invaluable record of communication. And yes, it’s efficient. And no, I’m not going to say you have to be more empathetic and caring in all your relationships – that’s your call.
    • But email is for transactions. An organization that kids itself that it can reduce all decisions to transactions is an organization that can’t tell forests from trees.
    • Interactions that are overweighted into transactions become poor at executing  strategies (despite their attention to detail), because strategies require frequent strategic-level thinking.
    • A culture that over-celebrates impersonal transactions is likely to be non-innovative, because innovation thrives on the trust that allows people to challenge each others’ ideas.

3. Blame stalks the halls.

    • One of the worst sayings is, “No one ever got fired for hiring [IBM, McKinsey, etc].” It may not be bad for IBM or McKinsey, but it means that business decisions are being made by employees based on personal risk-aversion, rather than on the organizational good. That makes for some very bad decisions.
    • Behind blame lies fear. Employees driven by fear will never properly value risk. They will avoid people and decisions based on their personal fears; this avoidance increases inefficiencies and lowers innovation. Ironically, it ultimately also raises risk.
    • Blame is captivity, as Phil McGee says. When blame reigns, you can’t tell who’s responsible. When you’ve got no responsibility, accountability is meaningless. Blame leads to ineffectiveness; and that means you can’t make decisions, respond to markets, or do positive things.

4. People talk about each other.

    • People talking frequently about each other suggests gossip, which usually means talking behind people’s backs. This signals an inability to confront real issues. This means politics replaces truth telling.
    • Ask someone where they work in an organization. At a great company, it might be “in bubble memory technology.” Or, “in the semiconductor division, in R&D.” In a low-trust organization, the answer will be, “In Robinson’s group.”
    • The cult of leadership is just another cult. Steve Jobs may have been revered (or not), but he knew the desired obsession was not about personality, but the business. Celebrate, but don’t idolize.

5. People complain.

    • Complaining is wrong because it is wishing, not doing. If you didn’t win the lottery, you’ve no business complaining if you didn’t buy a ticket.
    • And if you bought a ticket and are complaining about the odds, you don’t understand the lottery.
    • If you bought a ticket, understand the odds, and are still complaining, you have no sense of your obligation in this organization, which is to do something about it. Go make a better lottery.
    • Complainers suck out the air in the room. They are self-oriented, they drag down productivity, and slow results. If you don’t get rid of them, it’s probably because you’re fearful (see #3, above).

These employee behaviors are warning signals of low trust in an organization. Low trust threatens your economics, innovation, speed to market, cost position, overhead structure, employee turnover, and customer indifference or worse – and a whole lot more.

For some ideas on how to improve trust, see Three Strategies to Improve Business’s Trust.

In the next post we’ll explore Five Warning Signs in Teams that suggest a low-trust organization.