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Trust Matters, The Podcast: The Cult of Closing (Episode 10)

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Fear and Forgiveness

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This week our very own Lisa McArthur tackles the weight of fear and the weightlessness of forgiveness.

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Reading the story of Dean Otto this week, it’s hard not to reflect on the power of forgiveness.  For those not familiar with his story, Dean was seriously injured when struck by a truck while riding his bike last September.  He had no feeling from the waist down.  Against the odds, last week Dean completed a half-marathon in under 2 hours.  But what makes this story so unique is that Dean ran that marathon alongside his surgeon and the young man who hit him.

Even while sitting on the side of the road, Dean forgave the driver.  “I accepted what had happened to me.  I forgave the guy that hit me so I wouldn’t harbor any resentment and being able to do that has really helped me throughout the whole process.”

WOW!

A poignant example of forgiveness overcoming fear.  Fear holds us back and restricts us from working together and accomplishing truly inspiring things.  The ability to be gracious, to forgive, to move forward past a challenging event benefits everyone involved.  If Dean can forgive the driver of the truck that hit him…what’s stopping me? What grievances do you have in your workplace and what’s stopping you from moving past them? In a word…FEAR.

Fear makes us hold back, avoid situations and do nothing. But doing nothing has a cost a well. How do we move past our fears, forgive and build trust?

Step 1: Name your fear

Start by being explicit about what is holding you back. Here are 4 common ones:

  • Execution fear – I might make a mistake
  • Competence fear – I don’t how to do it right
  • Outcome fear – Everything might not turn out the way I want it to
  • Shame-based fear – They might not like or respect me anymore

Step 2: Write it, Read it, Say it

Once you can identify your fear, write it down, read it and say it out-loud. Don’t be tempted to skip this step. By writing things down and saying them out-loud, we move past our fight-or-flight emotional impulses and diminish the power of the emotion. I’ve often been in contentious meetings and have scribbled many such “verbalizations” in the margin of my notebook. Trust me…it works!

Step 3:  What’s the worst that could happen?

Think about your next meeting or conversation? What will you say or do? What is the worst thing that could happen? Could you be challenged? Yes. Could you be embarrassed? Possibly. What else might happen?

For many of us, the outcomes will not be life-threatening. They may be unpleasant for the short-term but will be things we can overcome. Thinking about outcomes rationally can help us maintain perspective and take the fear out of the situation.

Step 4: Identify the other person’s fear

Put your fears aside and try to see things from the other person’s perspective. Dean Otto told the young driver to not let this define or haunt him. He recognized the fear and impact of the event on both of them. Think about your personal situation…what fears might be driving the other person’s behavior? How might you be able to help them overcome their own fears?

This serves two key purposes…it may help you find new win-win ways to deal with the situation…but most importantly, it changes the sound of that little voice inside your head and lets you move beyond your fear.

Step 5:  Act

Most importantly, you need to act.

Understanding both perspectives, take honest stock of the situation, define what you can and cannot do, then take action. Remember, the fear of doing something wrong often stops us from doing something right. Be confident in your intent. As Dean said he “forgave…so I wouldn’t harbor any resentment.”

Team performance in any organization starts with collaboration. We must learn how to hold ourselves accountable to each other, get past our own fears and resolve conflict quickly. Fear holds us back and prevents us from working together. By acknowledging our fears and taking the risk of forgiveness, we create teams that can accomplish great things. What fears are holding you back from forgiveness and what risks are you willing to take to run your own version of a half-marathon?

Trust is Down? Wait – What Does That Even Mean?

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Today, it seems nine out of ten stories in the general media are variations on one theme: trust is down. Whether it’s trust in the media, trust in politics, trust in business – it all seems to be heading in one direction.

But wait – what does that even mean?

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We hear it all the time. Trust in banking is down. Trust in Congress is down. Trust in the educational system is down. We hear these statements, we say, ‘tut-tut what’s the world coming to,’ and we go on about our business – in large part, because we don’t know what to do about them.

Well, no wonder.  These seemingly obvious statements mask a fundamental confusion about the nature of trust – a confusion that prevents us coming up with basic solutions.

The problem is this. When trust in banking is down, does that mean:

a. that banks are less trustworthy than they used to be?  Or,

b. that people are less inclined to trust than they used to be?

Those are very different problems. Typical solutions to the problem of trustworthiness have to do with ensuring the behavior of the trustee.  Think regulations, penalties, enforcement, behavioral incentives and the like.

We too often neglect the other side of the equation – the propensity to trust. The problem is simple enough to state: you may be the most trustworthy partner in the world, but if the other party is unwilling to trust you, nothing will happen.

The propensity to trust is critical. It amounts to risk taking. Despite Ronald Reagan’s famous quote to the contrary, there is no trust without risk. The dictum to “trust but verify” in fact destroys trust by sanctioning acting on suspicion.

The Hitchhiking Problem

In the 60s, hitch-hiking flourished. By the late 1980s, it was dead.  Partly, hitchhikers were afraid to hitch; but mainly, drivers were afraid of hitchhikers. And it wasn’t due to an epidemic of violence; it was due to a fear of violence.  We lost a great deal when we lost hitchhiking – economically and culturally.  (The move to collaborative consumption, interestingly, is a contemporary resurrection of that idea).

Why is hitchhiking relevant to trust in banking?  Because one common response to low trustworthiness – perceived or otherwise – is a reduced propensity to trust. Which will kill trust just as surely as will low trustworthiness.

There is a huge cost to low propensity to trust; look at The Cost of Fearing Strangers by the Freakonomics folks. We are great at articulating the risk of doing something; we are awful at noticing the cost of doing nothing.

Want a really Big Example? Next time you’re in an airport, look at the social cost of us not being able to trust grandmothers from Des Moines on their flight to Fargo.

The Laws of Trust

To people schooled in free-market economics ways of thinking, trust is hard to make sense of. If the propensity to trust declines, you’d think the market would respond by creating more trustworthy offerings. In fact, just the opposite happens. Suspicious people tend to attract con artists; skeptics get sucked in by fakes.

The reason is simple: trust is not a market transaction, it’s a human transaction. People don’t work by supply and demand, they work by karmic reciprocity. In markets, if I trust you, I’m a sucker and you take advantage of me. In relationships, if I trust you, you trust me, and we get along. We live up or down to others expectations of us.

We have been teaching and practicing business according to the wrong Laws of Trust. The solution for low trustworthiness is not necessarily to trust less, but to trust more, and more intelligently. Maybe you’ve heard, “The best way to make someone trustworthy is to trust them.”

We’re Teaching the Wrong Laws

Our public education and culture is loaded with the free-market versions of trust. We teach, “If you’re not careful they will screw you.” We passcode-protect everything. We are taught to suspect the worst of everyone, be wary of every open bottle of soda, watch out for ingredients on any box.

Then in business school, we are taught that if customers don’t trust you, you need to convince them you are trustworthy – partly by insisting on our trustworthiness.  You can’t protest enough for that to work: in fact, guess the Two Most Trust-Destroying Words You Can Say.

By teaching distrust and confusing trust recovery with messaging, we are teaching entire generations to be suspicious of anyone and everything. By teaching suspicion and distrust, you can make book on it: what we’ll get is a reduction in trustworthiness. Read the Tale of the Thieving Convenience Store Managers.

This doesn’t mean we shouldn’t teach trustworthiness; much of my career has been built heavily around that. But by itself it’s not enough.

We need also to be teaching risk-taking, relationships, and the values of being connected to other human beings –not just than calibrating the dangers of hitchhiking.

Don’t tell me there’s no data.  The General Social Survey has been collecting data on the propensity to trust since 1972. One interesting finding: the propensity to trust is strongly correlated with educational attainment.  What does that say about the social and economic costs of cutting educational investment in the name of lowering taxes?

And don’t tell me I’m naive. I recall a trip to Denmark a few years ago. I left my wallet in a taxi. By the time I discovered it, my client had left me a message to say the taxi driver had returned it to their offices, and they’d paid him to bring it to my hotel. Which he did.

I expressed amazement at how well it had all worked out. My client said, “Nothing to be surprised at. Anything less would have been surprising.”

And I bet the Danes hitch, too.

Trusting: the Other Side of Trust

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Much has been written about trust.  However, it’s often not clear in the writing whether the subject is trust, trustworthiness – or trusting.  If trust in the government is down, does that mean that the government is less trustworthy? Or does it mean that people are less inclined to trust?

Most of my work has been about trustworthiness (e.g. The Trusted Advisor). Other people write more overtly about trusting – a good example is the HBR article ReThinking Trust, by Stanford Professor Rod Kramer, which focuses on the danger of trusting.

Some people write about the big subject of trust itself – the end result of the interaction between trustor and trustee. A fine example is Francis Fukuyama’s classic Trust: the Social Virtues and the Creation of Prosperity.

Finally, many other sources end up talking about all three; think Covey’s Speed of Trust, or Bob Hurley’s The Decision to Trust.

The Power of Trusting

The sources above are largely academic. In the popular press, by far the most common topics are trustworthiness and the state of trust itself (trust as the result of an interaction between trustor and trustee). Throw a dart into a pile of 100 popular press articles on trust, and you’re likely to find Congress, investment bankers, and the Madoff-du-jour scandal as the subject.

This means most public policy debates focus on trustworthiness.  Most examples are negative; hence trusting is positioned as cautionary, i.e. watch out for car salesmen, lawyers, etc. The moral of the story is tut tut, another untrustworthy group, watch out.

And all this focus on negative examples of trustworthiness is having an effect on people’s inclination to trust. How could it not! And that is a terribly unfortunate thing. Because the scarce trust resource increasingly is not trustworthiness, but the willingness to trust.  We need to start focusing on the trustor, not just on the trustee.

The power of trusting is enormous. When it comes to trust, there is an answer to the chicken and egg dilemma of which comes first, the trustor or the trustee?  The answer is trustor.  Consider:

  • Until one party decides to take a risk and trust another, trust does not come into existence
  • Trusting has a profound impact on trustworthiness – think “the fastest way to make a man trustworthy is to trust him,” or “people live up or down to the expectations of them”
  • Trusting is inherently an act of optimism; a decline in trusting in the business world drives down innovation, and prevents collaboration and alliances.

 

Traveling Trust, Reciprocating Trust

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I was in Munich for a one-day stopover en route to Bucharest. I left New York a day earlier than planned to avoid some weather. And I realized yet again – travel has a way of doing that – what an extraordinary level of trust we all take for granted in our modern world.

Yes, the news is full of the opposite. Doctors have a hard time trusting pharmaceutical manufacturers. Patients have a hard time trusting their doctors, and doctors have a hard time trusting their patients. Some patients trust the internet more than their doctors, often with bad results. And trust in most institutions is down over time (the military being a notable exception).

A Trusted Trip

With all that going on, it’s easy to forget some basic things. I can freely cross national borders with some mere papers. I can trust the exchange rate when I buy Euros. I can trust the flight controllers that govern the airspace, the airline handling companies that do catering, the bus and taxi systems I encounter.

But most of all, I know I can rely deeply on the basic human decency of people I run into to help with any simple issues – even though we may not speak the same language, and we’ll never see each other again. I can trust that people will give me directions, help me with travel issues, take a moment to help sort out a problem. And I’m almost never, ever wrong in that basic level of trust.

Which motivates me, of course, to try and return the favor whenever I can. And you do the same, I know.

What’s Really Amazing

What’s really amazing is not how often trust goes wrong, but how often it goes right.  Our modern life is unbelievably complex, and yet runs remarkably well.

I don’t want to be Pollyana-ish about this. The fact that trust is so pervasive is precisely the reason we notice and feel trust violations so deeply. We are all right to be deeply offended by untrustworthy behavior; if we lose our capacity to be outraged, we have lost our ability to recover.

Lots of things can be said about lost trust, but I want to highlight one. Trust is reciprocal. My trusting you causes you to trust me, and vice versa. An absence of trust starts with one party. The presence of trust starts with one party. The question facing all of us is, will you be the one to start?  Or will you always insist on the other party going first?

Do you insist on your vendors insuring you against all losses?  Then don’t be surprised when they don’t trust you.  Do you have all your employees sign cutting-edge non-compete clauses?  Then perhaps you can understand why they might seek ways around it.  Do you give lie detector tests to your employees? Then you might gain insight into why you have a shrinkage problem.

You can do your part as an individual too. To be trusted, be trustworthy.  And if you think others are not trustworthy as you – try trusting them first.

For starters, that’ll make your travel a lot easier.

Defining Trust

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“…’tis a tale told by an idiot, full of sound and fury, signifying nothing.”

—Shakespeare, MacBeth

 

Note: This post comes out of ongoing discussions with Barbara Kimmel, CEO of of Trust Across America. She and I share a concern (as do many others) about how imprecision in speaking about trust hampers progress. It’s not an easy topic, but we both believe progress can be made. She’ll be writing about the subject soon as well.

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  • “Trust in banking is down.”
  • “I don’t trust what car companies say – I trust someone like myself.”
  • “I trust Amazon, but not Google.”

We make statements like these every day in our casual conversations. We intend them to be – and believe them to be – meaningful. We think we’re saying something by uttering them.

And yet – each of those statements is confused, often to the point of meaninglessness. As Shakespeare would have put it, they are full of “sound and fury” –  while signifying very little.

The mistakes inherent in those statements are not just found in casual conversation. They are ubiquitous in the business and general press, and even, occasionally, in academic writings. The level of discussion about trust is fraught with definitional ambiguity pretty much everywhere.

Yet if we can’t talk meaningfully about trust, then we cannot possibly arrive at useful, justified conclusions for action. How can we create trust-based organizations? Cultures of trust? Increased trust in institutions? Have meaningful discussions about cross-generational trends in trust?

Without common definitions, we are reduced to bemoaning the fate of trust, wringing our hands as bystanders, accomplishing nothing. We need basic definitions.

This post doesn’t pretend to offer a comprehensive definition. But it does humbly attempt to provide three simple distinctions for use in talking about trust. All are obvious when pointed out, but they are not observed in practice.

Let’s call them:

a) the Grammar of trust,

b) the Objects of trust, and

c) the Actions of trust.

The Grammar of Trust: Trust as a Noun, a Verb, and an Adjective.

What does it mean to say, “Trust in banking is down?” Does it mean banks have become less trustworthy? Or does it mean public opinion is turning against banks? Or both?

It makes a difference – that is, if our discussions are to have any policy implications. This is loose language “signifying nothing,” unless we clarify what definition of trust we’re using.

  • To trust someone is to take a risk, to put yourself willingly in harm’s way of another. This is the verb, “to trust.” It’s what the psychologists focus on as a propensity to trust; it’s the entry point of business books like Bob Hurley’s The Decision to Trust.
  • Trustworthiness is an adjective – it’s an attribute we ascribe to others. It falls in the category of virtues. We use ‘trustworthy’ to describe people who we think reflect virtues like credibility, reliability, of high integrity, benevolent, un-self-preoccupied. It’s talked about in books like The Trusted Advisor as the Trust Equation.
  • Trust as a noun is the state of a relationship between two parties. It exists or it doesn’t; if it does, it is described as high or low, thick or thin, broad or deep. Sociologists use this to talk about high- or low-trust societies or cultures. In business, Edelman’s Trust Barometer primarily (when it is clear) focuses on the state of trust.

Violations of grammar.  When we see “Trust in banking is down,” we should immediately ask: which meaning of trust is being used here?

  • If we mean banks have become less trustworthy, this is trust as an adjective. If this is the issue, then what data is being used to define trustworthiness? And should we seek industry-based or regulatory-based solutions to the issue?
  • If we mean that people have become less inclined to trust financial institutions, this is trust as a verb. If this is the problem, is it unique to banks? Or is it part of a general decline in propensity to trust? What kind of social intervention are appropriate – industry associations? Public relations campaigns? Awareness and reach-out initiatives?
  • Or do we strictly intend just to indicate a decline in the state of trust? This is trust as a noun. It is something we can track over time; but It should always beg the question, why? What have been the patterns of trustworthiness, and the patterns of propensity to trust? What is driving the state of trust lower?

If you’re not persuaded that this is a meaningful issue, consider the national (US) debate on violent crime. By most indicators, the incidence of violent crime over the last few decades is down. And yet the fear of crime is up. This is a case where the verb (to fear) is unlinked to the adjective (highly criminalized). If we don’t correctly identify the problem, we will continue to fix a “problem” (violent crime) which is not the primary driver of fear.

Objects of Trust: Personal vs. Institutional

“I don’t trust car companies – I trust someone like myself.”  It may seem obvious that trusting a person is not the same as trusting an institution – Citizens United notwithstanding – but the difference is often blurred.  We’re not confused by, “I trust FedEx to deliver my packages, but not to babysit my daughter,” because baby-sitting requires an individual, not a firm, and we don’t think of FedEx delivery people as being in the baby-sitting business anyway. Trusting people is fundamentally different from trusting organizations.

This may sound obvious, but major trust surveys, e.g. the Edelman Trust Barometer, say things like “trust in someone like me” is trending up vs. “trust in government” or “trust in companies.” This is a category mistake. The two types of trust are qualitatively distinct; they do not belong on the same quantitative scale. The blurring of lines is similar to that of “friends” on Facebook – we use the same word to describe our digital tribes that we use to describe our neighbors and old college buddies. The common language use must be recognized and respected – but it doesn’t mean the meanings are the same.

Former Speaker of the House Tip O’Neill famously said, “All politics is local.” In a similar way, most trust is personal. If FedEx misses two deliveries in a week, my “trust” in them is seriously eroded. Yet if my best friend fails to return two calls, I am perplexed – but my trust in them is barely affected. This is not surprising – it’s not the same trust that we’re talking about.

Trust in particular organizations – companies, congress – is “thin” trust. It’s connected to branding, reliability, reputation – but not to the more powerful personal attributes we associate with trusting individuals. Most people “distrust” congress, at the same time they’re more inclined to “trust” their individual congressperson. This is only surprising if we think the same ‘trust’ is at issue.

Companies that consistently score high on broad measures of trust (see for example, Trust Across America’s Most Trustworthy Companies) are usually, on closer examination, companies that assiduously foster trust-based relationships between individuals – between employees and customers, among employees, with local constituent organizations.

Sloppy use of the object of trust – anthropomorphizing trust when we talk about institutions, for example – should be avoided by writers, and sharply pointed out by readers. The word “trusted” means very different things when applied to Toyota, to my LinkedIn affinity group, and to my next-door neighbor. I may ‘trust’ them all, but we are talking about quite different phenomena.

Actions of Trust: Trust to Do What?

I may trust my dog with my life – but not with my ham sandwich. We all get the difference – and yet we see sentences like, “I trust Amazon – but not Google.” The Amazon/Google difference is probably the same as the life/ham sandwich difference – but we don’t usually hear it the same way.

To see why, just ask what it is that we are trusting Amazon and Google to do? Most likely, the utterer of that sentence means that Amazon delivers fast and reliably, and that Google tracks mountains of information about us. Fast delivery and responsible guardianship of private information are very different things – maybe as different as “life” and “sandwich.”  And yet we act as if we’re making a meaningful statement about corporate trustworthiness when we use the “T” word with both companies in the same sentence. We are not – we are expressing distinct opinions about two very different phenomena.

Whenever you read (or write) something comparing levels of trust – whether it’s between people, or organizations (or across people and organizations), always remember to ask – trust to do what?

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There are other definition issues of trust – for example the general propensity to trust strangers vs. the more specific (and variable) trust in particular institutions or individuals. As Eric Uslaner says, “If you punch me in the face, my trust in humanity is un-diminished – but you are and I are finished!”).  But if we just more critical readers (and writers) about the above three distinctions, the discussion of trust would be greatly advanced.

 

Why Your Clients Don’t Trust You – and How to Fix It

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Do your customers trust you? Be honest, now, this is not an in-house survey. Do they believe what you say? Will they cut you a break if you goof up?  Are they happy to share information with you? Do they go out of their way to refer you?

Can you honestly answer ‘yes,’ to yourself, in the dead of night, to those questions?

If you’re trying to sell your services, you already know the value of being trusted. Being trusted increases value, cuts time, lowers costs, and increases profitability—both for us and for our clients.

So, we try hard to be trustworthy: to be seen as credible, reliable, honest, ethical, other-oriented, empathetic, competent, experienced, and so forth.

But in our haste to be trustworthy, we often forget one critical variable: people don’t trust those who never take a risk. If all we do is be trustworthy and never do any trusting ourselves, eventually we will be considered un-trustworthy.

To be fully trusted, we need to do a little trusting ourselves.

Trusting and Being Trusted

We often talk casually about “trust” as if it were a single, unitary phenomenon—like the temperature or a poll. “Trust in banking is down,” we might read.

But that begs a question. Does it mean banks have become less trustworthy? Or does it mean bank customers or shareholders have become less trusting of banks? Or does it mean both?

To speak meaningfully of trust, we have to declare whether we are talking about trustors or about trustees. The trustor is the party doing the trusting—the one taking the risk. These are our clients, for the most part.

The trustee is the party being trusted—the beneficiary of the decision to trust. This is us, for the most part.

The trust equation is a valuable tool for describing trust:

But where is risk to be found? How can we use the trust equation to describe trusting and not just being trusted? How can we trust, as well as seek to be trusted?

Trust and Risk

Notwithstanding Ronald Reagan’s dictum of “trust but verify,” the essence of trust is risk. If you submit a risk to verification, you may quantify the risk, but what’s left is no longer properly called “trust.” Without risk there is no trust.

In the trust equation, risk appears largely in the Intimacy variable. Many professionals have a hard time expressing empathy, for example, because they feel it could make them appear “soft,” unprofessional, or invasive.

Of course, it’s that kind of risk that drives trust. We are wired to exchange reciprocal pleasantries with each other. It’s called etiquette, and it is the socially acceptable path to trust. Consider the following:

“Oh, so you went to Ohio State. What a football team; I have a cousin who went there.”

“Is it just me, or is this speaker kind of dull? I didn’t get much sleep last night, so this is pushing my luck.”

“Do you know whether that was a social media reference he just made? Sometimes I feel a little out of the picture.”

If we take these small steps, our clients usually reciprocate. Our intimacy levels move up a notch, and the trust equation gains a few points.

If we don’t take these small steps, the relationship stays in place: pleasant and respectful, but like a stagnant pool when it comes to trust.

Non-Intimacy Steps for Trusting

The intimacy part of the trust equation is the most obvious source of risk-taking, but it is not the only one. Here are some ways to take constructive risks in other parts of the trust equation.

  1. Be open about what you don’t know. You may think it’s risky to admit ignorance. In fact, it increases your credibility if you’re the one putting it forward. Who will doubt you when you say you don’t know?
  2. Make a stretch commitment. Most of the time, you’re better off doing exactly what you said you’ll do and making sure you can do what you commit to. But sometimes you have to put your neck out and deliver something fast, new, or differently.To never take such a risk is to say you value your pristine track record over service to your client, and that may be a bad bet. Don’t be afraid to occasionally dare for more—even at the risk of failing.
  3. Have a point of view. If you’re asked for your opinion in a meeting, don’t always say, “I’ll get back to you on that.” Clients often value interaction more than perfection. If they wanted only right answers, they would have hired a database.
  4. Try on their shoes. You don’t know what it’s like to be your client. Nor should you pretend to know. But there are times when, with the proper request for permission, you get credit for imagining things.”I have no idea how the ABC group thinks about this,” you might say, “but I can imagine—if I were you, Bill, I’d feel very upset by this. You’ve lost a degree of freedom in this situation.”

While trust always requires a trustor and a trustee, it is not static. The players have to trade places every once in a while. We don’t trust people who never trust us.

So, if we want others to trust us, we have to trust them. Go find ways to trust your client; you will be delighted by the results.

 

This post originally appeared on RainToday.com

 

The Blind Men and the Elephant of Trust

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The Elephant of TrustIn my last post I wrote about the silos that exist between and within business and academia when it comes to trust. There are few subjects outside philosophy for which the question of subject matter definition is so important as it is in the case of trust.

Like the tale of the blind men and the elephant, each party sees an important part of the subject of trust – but then is inclined to view the rest of the world in those terms. As the saying goes, if you have a hammer, the world looks like nails.

So this is my attempt to define the differing perspectives on trust, looking across the fields of business and academia. I welcome your additions or comments.

I identify four important views of trust, and I’ll label them by the best-known holders of those viewpoints. They are distinguished mainly by differing focus on the trustor, the trustee, and the resultant trust, as well as by individual, social or institutional trust.

The Psychologists’ View

The psychologist’s view focuses on the perception of an individual person facing the decision to trust. In the words of Mayer, Davis and Schoorman in an oft-cited 1995 article, trust is:

the willingness of a party to be vulnerable to the actions of another party based on the expectation that the other will perform a particular action important to the trustor, irrespective of the ability to monitor or control that other party.

This is a model built around an individual trustor, not a trustee, and in particular about the trustor’s assessment of the trustee’s competence, integrity and benevolence. It’s my impression that this model is typically portrayed in a rational, self-good-maximizing context, comfortable to behavioral economists, for example.

If you search Twitter streams – the democratic way of market research – this is also the most common use of the word ‘trust.’ The twittersphere is full of “don’t trust women, they break your heart,” or “when people lie to me I can’t trust them.” (Though note: twitter users are a whole lot more affective or emotional than the usual behavioral model allows for).

An interesting application of this trustor-centric viewpoint beyond the individual to the corporate perspective is Bob Hurley’s The Decision to Trust, where he deals with group decision-making and cultural factors that affect trusting behavior in the company.

The Political Scientists’ View

Political scientists like Uslaner or Fukuyama also focus on the trustor’s viewpoint, but focus on groups of trustors (e.g. nations, or cultures), and on their willingness to trust generally, e.g. their inclination or propensity to trust strangers. It is from this viewpoint that we read about the greater levels of trust in the Scandinavian countries, or the lower levels of trust in southern Italy or in Wall Street trading firms.

Uslaner calls this generalized trust, something measured in the General Social Survey for decades; it changes slowly, unlike trust in specific people or institutions.

The Corporate Virtues and Values View

Where psychologists focus on the trustor’s decision to trust (a verb), business tends to focus on the trustee’s trustworthiness (a noun). At an individual level, that might be called virtues; at a group level, values.

In my own model, co-developed first in The Trusted Advisor, the Trust Equation is the expression of the the individual virtues of trustworthiness – credibility, reliability, intimacy, and other-orientation. At an organizational level, the Trust Principles are the articulation of group values in my own construct.

A recent example of this viewpoint is PwC Chairman Dennis Nally’s article The Trust Agenda. It focuses on creating value through values, and on creating greater trustworthiness from within; and not much at all on the issues of trusting.

The focus on virtues and values is an obvious one for business, which for the most part is more concerned about being trusted than trusting. Of course, being trustworthy alone isn’t sufficient to make trust happen – you need a trustor. Business in general focuses on the trustor role mainly through the eyes of the trustee, just as psychology tends to view the trustee largely through the eyes of the trustor.

Business and academics alike have trouble defining institutional trust; it makes a little bit of sense to say we trust Citibank (or not), but very little sense to say that Citibank trusts us. Both trusting and being trustworthy are largely individual traits.

The business focus on the trustee therefore makes “a trustworthy organization” at least conceivable, whereas the academics’ focus on the trustor makes “a trusting organization” problematic. The answer, I suggest, is to frame trust issues at the organizational level as being about creating trust-enhancing environments – not just about trustworthiness, and certainly not about abstract entities committing human acts of trusting.

There is one important attempt to rigorously identify objective characteristics of trustworthiness at a corporate level; it is the FACTS model of Trust Across America. It is the most data-based proof I know of the corporate-wide profitability of trustworthy behavior.

The State of Trust View

What happens when you measure the result of the interaction between trustor and trustee? You get something like the Edelman Trust Barometer, which is known for drawing conclusions like “trust in banking is down.”

This is a survey approach to trust. It doesn’t try to distinguish lower trustworthiness in bankers from lower propensity to trust by consumers, but instead precisely tracks the net result of that interaction.

Numbers in the State of Trust view are constantly changing (unlike in the political scientists’ view), because the object of trust is very specific (an industry, a government sector), and there is an implied specific action. Asking “do you trust Amazon” presumes a very specific object of that trust – typically to buy books or to guard data. It doesn’t occur to us to trust Amazon with our babysitting.

By contrast, numbers in the political science view change slowly because, as Uslaner puts it, if I punch you in the face, your trust in me may decline, but your trust in the human race is pretty much unaffected.

The Role of Risk

There can be no trust without risk, Ronald Reagan’s “trust but verify” statement notwithstanding. Risk is implicit in the Corporate Virtues and Values view, and explicit in the other three.

In the corporate realm, partly because of the focus on being trusted, companies have confused risk eradication with increasing trust. There is a vicious paradox of trust – the more either party tries to control risk, the less trust results. Companies who think they are increasing trust by risk mitigation and compliance programs are doing just the opposite – they are eroding trust.

The challenge for business –recognize the role of trusting, both within the organization and outside it.

In the academic realm, partly because of the focus on trusting, it’s difficult to account for the boomerang effect of greater trustworthiness that results from being trusted. People have a way of confounding rational-choice models when it comes to trust.

The challenge for academia – recognize the roles of virtues and values in their own terms, not just through the eyes of the risk-taking trustor.

What business can learn from academia: a structured, disciplined approach to studying issues of trust.

What academia can learn from business: a wealth of real-world data to be studied and understood.

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So there you have it – my attempt to describe several of the blind men feeling the elephant of trust.

What’s your take on it?

Trust in Nebraska

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Trust in NebraskaI’m back from a four-day Conference on Institutional Trust at the University of Nebraska in Lincoln, where I was one of only two non-academics (the other a most talented Federal judge from Maryland). A few headlines.

First, our hosts – the University of Nebraska’s Psychology Department and its Center for Public Policy – could not possibly have been more gracious and hospitable. Since my parents and grandparents all hail from Nebraska, this was no surprise to me, but still gratifying.

Second, the four days were very enlightening – though not quite in the ways I had expected. This is the first of a two-part series (second part here) where I try to explain what I learned by playing missionary from the Land of Business to the Land of Academia.

Silo City

It was no surprise to me that there’s a huge gap between the business world and academia when it comes to trust. What I didn’t expect was to find silos even within academia. Allow me to explain.

The conference was hosted mainly by the psychology profession, though there were a few business school academics and even a few political scientists in attendance.

The leading model in the psychologists’ view of the world is one produced by David Schoorman of Purdue’s Krannert School, in 1995. I have to confess I had not heard of it, or of him, though the model feels very familiar (competence, integrity, benevolence). Schoorman was in attendance.

Also present was an academic much better known to me, political scientist Eric Uslaner. Uslaner wrote The Moral Foundations of Trust – a masterful and powerful book. It was a delight to finally meet him in person.

One academic not in attendance but whom I’d have loved to meet was Francis Fukuyama, also a political scientist, from Stanford. While better known for his book The End of History, he also wrote a powerful volume called Trust: Social Virtues and the Creation of Prosperity. Not only is it a brilliant book, but as of today, it still ranks number 216,239 on Amazon.

Let me put that in context: that book was by an academic, written in 1996, and that current sales ranking is competing with Harry Potter, Thomas Piketty’s Capital, and Game of Thrones. Not bad. (By comparison, 2006’s Freakonomics currently clocks in at #143,189).

So, about those silos. I’ve already admitted I had not heard of Schoorman. To my shock, neither had Uslaner. In fact, Uslaner suggested he knew only about 5% of the 100 or so people in attendance. As nearly as I can tell, they returned the favor. All this despite all of them toiling in the nominally same trust vineyard.

It gets better. I asked a panel of 8 for their views on Fukuyama, and it seemed that only 1 person was willing to comment (I’m guessing, though can’t prove it, they were not aware of his work). And yet they are all academics.

It goes without saying they hadn’t heard of me before (though I will say for the record: as of 9:59PM on 12 May, 2013, The Trusted Advisor ranks number 8,286 on Amazon – despite being published back in 2001.)

OK, so that’s not so surprising. But I also got blank stares whenever I mentioned Steven M.R. Covey’s Speed of Trust – #1,306 on Amazon, outranking all the rest of us. Ditto the Edelman Trust Barometer survey, which gets presented each year at Davos.

Now, the point is not to dump on academics – after all, I’m sure that in any room of 100 businesspeople you’d probably not even find one person who was aware of any of the above-mentioned academics, whereas there were two or three in Lincoln who were aware of some of the business literature. (By the way, props to the academics for being  more rigorous in their discussion of trust than business people, albeit narrower in focus).

The point is, whether you’re talking within business, within academia, or across the chasm dividing the two, you find a general lack of awareness about what else is being done in the field. Add this to the definitional issues surrounding trust, and you get a pretty disconnected approach to trust in the world.

Six Blind Men and the Elephant

But what’s really interesting  is not that the silos exist – it’s the differences between the silos that are fascinating. It turns out that the way the psychologists think about trust is skewed differently from the way Edelman PR thinks about trust. And that in turn is different from the political scientists, who in turn see things differently from groups like Trust Across America.

And that’ll be the subject of my next post, The Blind Men and the Elephant of Trust, an attempt to very broadly scope out the differing perspectives on trust.

Interview with Trust Expert Eric Uslaner

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ericuslanerEric Uslaner is perhaps the world’s leading authority on social trust. He was recently much in the news, as he is every year, with the annual publication of the General Social Survey on trust.  Here are some headlines from our talk this past fall.

Charlie Green: Thanks very much for speaking with me. We last talked back in early 2010. Now, most of my readers are accustomed to talking about trust in the sense of trustworthiness, like can I trust banks, or how can I get people to see me as trustworthy. Your approach is different. Let’s clarify that first.

Eric Uslaner: That’s right, it is different. You’re talking about people’s perceptions of other people’s trustworthiness. There are two parts to that: part one is it’s a specific person or institution about which you’re having the opinion: the other is that we view trustworthiness as the active characteristic.

I focus differently. I focus not on the perceived trustworthiness of specific individuals (or companies), but on the propensity of individuals to trust strangers, or people in general. It’s more about a worldview than about direct experience. And the GSS, which has included these key trust questions since the  late 60s, consistently asks that kind of question: “Do people generally mean well,” that kind of thing.

CG: What are the differences in looking at trust that way, as opposed to trust in banking, or JPMorgan Chase, or international banking?

EU: There are two big differences, and they’re interrelated. First, social trust – what I’m talking – about  changes far more slowly, over a longer period of time. Nowadays a third of Americans say that people generally can be trusted; 20 years ago that number was half. And in many ways it’s not because of a decline in trustworthiness – crime is down, for example.  But what’s changed is people’s propensity to trust strangers.

The second difference is that social trust, as I’m talking about it, is what we need to drive political societies. You’re not going to get problem-solving done in a pluralistic society by sticking with your own kind. Generalized social trust is what drives our institutions – not whether trust in banking is up or down last month.  And on that measure, we’re in deep yogurt.

CG: And how does social trust play out against these other forms of trust?

EU:  Most of the time trust in institutions (except for the military) tends to go up or down somewhat together. Much of it’s driven by the economy; when things are good, we generally trust each other. An example: Trust in government rose under Reagan, because the economy was doing well.  But trust in people declined over that same time, largely because inequality drove people apart.

CG: So, institutional trust has a shorter time-span than generalized trust?

EU: Yes. Institutional trust is the response to Ed Koch’s old question, “How’m I doing?” You look at the economics of the moment; that’s why presidents always try to have the economy’s wind at their backs going into an election, because people’s political trust is short-term.

But social trust, that’s more a matter of long-term questions. Will life be better for my children?  That doesn’t depend on the Fed, or the stock market.

CG: Say more about that? Has social trust got to do with empathy?

EU: Yes, but it’s much more than just empathy.  You have to have a willingness to interact with people, and to see the world from different perspectives. It’s not that you have to change your mind, it’s just that you’ve got to concede that someone else’s reality may have as much validity as your own.  And in the US, the Congress has come to reflect the same sort of denial of legitimacy that has characterized the Arab-Israeli divide for so long – a denial that the other side has any claim to decency.

CG: Let’s get basic. Is social trust valuable? Do we want it? Do we care?

EU:  Absolutely. It’s what allows social cohesion, national identity, a sense of purpose and mission in a society. You only solve social problems if you feel you own them. Once people start thinking more in terms of their narrow group and less about those “others,” it’s an easy flip from “they’re different” to “they’re wrong.”

It’s not hard to trust my wife, the people in my church, or those I meet at my grocery store or my school. The question is, can I trust those who are different from me, and whose values I may not share?  And by the way, the less those people shop at my supermarket or go to my kids’ schools, the less likely I am to trust them.

CG: I was going to ask – what drives this kind of social trust? Or is that too vague a question?

EU: It’s not too vague, but the answer requires two levels.   First, people who have a high propensity toward social trust are a) optimistic about the future, and b) feel they have control over their lives. And people who have a low propensity toward social trust are the reverse – they believe the world is getting worse, and that it’s largely beyond their control (if not controlled by those “others”).

CG: So – optimism and empowerment.

EU: Yes – and now for the punch line, the second order drivers of those two.  A propensity toward social trust is influenced by a) education, and b) economic inequality.  The less educated people are, and the greater the income dispersion in society, the lower will be the social trust.

CG: That makes some sense.

EU: It makes more than sense. Denmark is one of the highest-trust countries in the world, and also has extremely high education rates, and very low rates of economic inequality. Equally important, economic mobility is far greater in Scandinavia (and even in the UK, these days), than it is in the States.

CG: Why do education and income disparity drive social trust?

EU: Education teaches people that their worldview is not the only worldview. It’s the touchstone of tolerance and appreciation. And economic disparity – at least past some tipping point, indicated by the ability of groups to migrate upward economically – is an indicator of hope, or of hopelessness. Also, the further apart we are economically, the less it appears to all that our fates are linked.

CG: So where do we stand these days in the US, and in other countries?

EU: We have increasingly solidified patterns of racial and economic segregation of housing. Social mobility is now behind that of dozens of other countries.

In the US, the flight of the black middle class has left the double-whammy of economic and racial segregation, with no powerful social institutions to get people out. Segregated communities are dysfunctional across a plethora of indicators – both groups tend to identify more with in-groups, and less with the society at large.

CG: What can business do?

EU: Get involved in the larger society. It’s unfortunate that most business rhetoric has tended to work against any sustained effort to fight inequality. Historically, go look at what Coca Cola did in Atlanta, and what Henry Ford did in Detroit. Coke knew that good people wouldn’t want to move to a segregated city, so they became active in integration of schools. Henry Ford famously paid his people enough to be able to buy cars. If Ford had not been such a rabid anti-Semite, he might have had more influence on public policy on inequality.

The more companies pursue their own interest, the more difficult it is for them to pursue bonds with their own community, which drives inequality even further. The prevailing ideology of business these days is at odds with the creation of a society that nurtures business; it’s very short-sighted thinking.

In the US, I’m reminded of an old CBC comedy skit, The Royal Air Farce, who said, “Things are going to get a whole lot worse before they get bad.”

CG: And on that light note, we’ll have to leave it.  Please come back and chat some more, Ric, this has been extremely enlightening.