The research is in and the case has been proven: When companies create trusting work environments, employee engagement soars and the bottom line thrives. Yet most organizations don’t put resources into intentionally building trust; leaders just assume trust grows over time. Not so. Trust begins at the top, when leaders set trust-enhancing values and strategy.
How can you tell if you have a trusting work environment? Reading the nonverbal clues. If people trust leadership, they’re willing to turn their backs to their bosses. In other words, they turn and focus on their own work because they know the leadership means them no harm.
Horst Schultze, one of the retired founders of the Ritz-Carlton Hotels, was a great example of a trust-building leader. During Schultze’s reign, after orientation and extensive training, every employee was given a $2,000 discretionary fund they could use to solve a customer problem without checking with anyone. They didn’t even have to tell their boss. Horst loved to collect stories about how people honored this trust by making a difference for customers.
My favorite story is about the businessman staying at a Ritz-Carlton property in Atlanta. In one day, he had to fly from Atlanta to Los Angeles, then from Los Angeles to Hawaii, because the next day at one o’clock he was making a major speech to his international company. He was a little disorganized as he was leaving. On his way to the airport he discovered he’d left behind his laptop, which contained all the graphics he needed for his presentation. He tried to change his flights but couldn’t. He called the Ritz-Carlton and said, “This is the room I was in, and this is where my computer was. Have housekeeping get it and overnight it to me. They have to guarantee delivery by 10 o’clock tomorrow morning, because I need it for my 1 o’clock speech.”
The next day Schultze was wandering around the hotel, as he often did. When he got to housekeeping he said, “Where’s Mary?” Her coworkers said, “She’s in Hawaii.” Horst said, “Hawaii? What’s she doing in Hawaii?”
He was told, “A guest left a computer in his room and he needs it for a speech today at 1 o’clock — and Mary doesn’t trust overnight carrier services anymore.” Now you might think that Mary went for a vacation, but she came back on the next plane. And what do you think was waiting for her? A letter of commendation from Schultze and high-fives around the hotel.
That’s what a trusting environment is all about.
Punitive evaluation, on the other hand, leads to a low trust environment. Again, you can recognize these places by the nonverbal cues. People are not focused as much on their work as they are focused on the leader. They’re afraid to turn their back to the boss and concentrate on their projects because they’re worried. Is the leader going to find fault with the work they’re doing and punish them?
Once that anxiety begins, it can permeate the whole organization. People become demoralized, disengaged, unproductive, afraid to take risks and more likely to leave the organization. The fastest way to restore trust in a low trust environment is to revamp the way people are evaluated.
When I was a college professor, I always gave my students the final exam at the beginning of the course and spent the rest of the semester helping them answer all the questions so they could get an A. Garry Ridge, CEO of WD-40 Co., heard me tell that story and decided to do the same thing in business. He threw out WD-40’s old performance review system and created a process where people received feedback that helped them instead of labeled them. As a result, the company’s performance boomed, and employee engagement scores are consistently in the high 90th percentile.
As Garry and I point out in our book “Helping People Win at Work,” a leader’s job is to set clear goals and coach people to help them win. When people realize the good intentions behind a leader’s coaching — to help them succeed — they welcome feedback, and their performance shines. By the time performance evaluation rolls around, there are more celebrations than surprises because leaders have been encouraging them all along.
When trust is restored, creativity flourishes and productivity rises because when people win, the company wins.
Ken Blanchard is chief spiritual officer of The Ken Blanchard Cos. and coauthor of “Collaboration Begins with You: Be a Silo Buster.” Comment below, or email editor@CLOmedia.com.