The Dark Side of Trust? Not!

This blog regularly sings the praises of trust. It greases the wheels of commerce, ennobles human interactions, and generally makes the world go round.

Could it possibly be that trust has a downside? Omigosh.

From the always-provocative Harvard Business School Working Knowledge series  comes another  case of good data, flawed interpretation. This time it’s about plumbers in Philadelphia.

The Dark Side of Trust  summarizes research by Harvard Business School professor Felix Oberholzer-Gee and Victor Calanog, a doctoral student at the Wharton School at the University of Pennsylvania, in "The Speed of New Ideas: Trust, Institutions and the Diffusion of New Products."

They researched the introduction of an innovative new product (a plumber’s product called TrapGuard) to 596 plumbers and plumbing firms in Philly.

Now, some of those plumbers had strong relationships of trust with their suppliers—who presumably hadn’t told their customers about TrapGuard.  As HBSWK puts it:

The basic question at hand: Would TrapGuard encounter significant barriers to entry from plumbers who enjoyed trusting relationships with their suppliers? In other words, would plumbers be less likely to consider new products, even though innovative, because they were content with their current suppliers?

It should surprise no one that, indeed, plumbers who strongly trusted their suppliers were less inclined to pursue a promotional brochure for TrapGuard when sent one in the mail.

Here’s Oberholzer-Gee:

I wanted to see whether there was a downside to building trusting relationships between buyers and suppliers. In some sense, the study reveals a dark side of trust.

Trust is a double-edged sword. In the short run, working with trusted suppliers reduces transaction costs and furthers the buyer’s competitive standing.

But trust can also make you blind because it can make it harder to see opportunities that arise outside established relationships. The managerial challenge is to build trusting relationships without losing sight of outside opportunities.

Oberholzer-Gee clearly sees the double-edged sword nature of trust.

But presenting this as some kind of  “fair and balanced” offset to the positives of trust is at least a blinding flash of the obvious, and more likely disingenuous.

For example:

• The dark side of trusting your spouse to be faithful is you might not notice him consorting with that hottie;

• The dark side of a child trusting his parents is they might be homicidal maniacs;

• The dark side of loving (as any oldies station will tell you) is a broken heart.

Trust without risk is not trust at all. But of course. Trust is human risk management, a response to uncertainty—but one wholly unlike the rational, risk-parsing quantitative techniques typically taught and used in academia.

And here’s where it gets insidious.  HBSWK summarizes:

trusting relationships can also have a negative side that managers must take into account

HBSWK, and HBS, and Every Business School preach the Gospel According to Analytics. According to this gospel, managers “must take into account” some analytic cognitive insight at pretty much every turn, every transaction.

Never mind that “must” reeks of arrogance.  Note simply that if you subject every micro instance of trust to a micro-consideration of its worth, you destroy trust at the macro level.

Want a philandering spouse? Let her know every day how much you fear her infidelity. Want a suspicious, self-serving supplier? Constantly check them for suspicious, self-serving behavior.  Want thieving employees?   Give them all monthly lie detector tests. 

You empower what you fear.

Trust is a macro-response to life’s micro-issues.  You’d better evaluate it from time to time, like you would a marriage.  But if you constantly subject trust to the cognitive microscope, you destroy its essence.

“Must” you see the dark side of trust?  Don’t look too hard, you’ll miss all the glory, and ruin it in the looking.