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Trust-Based Leadership

Let’s start this month’s column with a mental experiment. Think back on a work situation where you trusted your boss. How hard did you work, beyond what you absolutely had to do? How much time did you spend worrying about things? How often did you think about quitting? Now think about a time when you didn’t trust your boss. Ask yourself the same questions. When I performed this little experiment, I saw some stark contrasts; you probably did, too. When followers trust their leader, good things happen for the followers, for the leader and for the organization. Let’s take a pragmatic view and focus on benefits for the organization.

Trust impacts performance in a variety of ways. In low-trust environments, considerable time and energy is wasted on job-related worrying and anxiety and on questioning the leader’s motivations. This friction is a drag on performance. Trust acts as a lubricant. When followers trust their leader, more time and energy is devoted to the job and less time is spent on worrying and questioning. Trust in the leader also increases organizational identification (the sense of oneness a worker feels with the organization). Identification brings about many benefits, including increased commitment to the organization, decision making that focuses on organizational (rather than personal) outcomes and agreement with organizational goals and values.

Trust increases organizational citizenship behaviors, which are discretionary behaviors that aren’t part of the formal reward system. Think of them as a worker’s willingness to go above and beyond what she has to do just to keep her job or get a raise. These behaviors include helping others, being loyal, complying in the absence of monitoring, individual initiative, self-development and sportsmanship. Sportsmanship deserves some explanation. At work, “good sports” are the people who don’t let minor inconveniences and impositions bother them. They don’t cop an attitude when things don’t go their way. They’re also willing to sacrifice personal interests for the good of the group. Taken together, organizational citizenship behaviors help create a more positive, productive work environment. To quote Martha Stewart, “That’s a good thing.”

Trust-based leadership impacts followers’ risk-taking behaviors. You might think this is a bad thing, unless we make a distinction between smart and dumb risks. Some risk-taking (dumb risk) is poorly thought out; the risks are too high for the potential payoff and too little attention is paid to mitigating the risk. Other risks (smart risks) have high benefit/risk ratios and clear ways to lessen the impact of the risk. In high-trust environments, workers feel empowered to take smart risks, which leads to innovation and performance improvement. Of course, the leader may have to help workers understand appropriate risk taking.

Trust-based leadership helps reduce turnover. Turnover is expensive, often 100 percent to 300 percent of the worker’s annual salary. Leadership trust reduces turnover by increasing job satisfaction and organizational commitment. Trust accomplishes this in part by creating a positive work environment characterized by hope, faith and caring. Trust further reduces turnover by improving workers’ acceptance of the leader’s goals and values.

Finally, trust-based leadership reduces counterproductive behaviors. Followers who trust their leaders are less likely to engage in overt and passive resistance. In low-trust environments, workers find all sorts of ways to game the system, slow down the work or resist change. These behaviors are often the result of thinking that the organization is out to get the worker. Followers of high-trust leaders know that the leader keeps their needs and interests in mind, so they’re less likely to engage in negative behaviors.

On the surface, it may sound like trust-based leadership results in a soft, unproductive workplace. On the contrary, a high-trust workplace is focused, efficient and effective. The workers also happen to be pretty happy. And that’s a good thing. FBN

 

The W.A. Franke College of Business at Northern Arizona University is home to over 2,700 undergraduate and master’s students. The College’s faculty and staff are dedicated to the success of its students and the economic development of the region. For more information on The W.A. Franke College of Business, please see: http://www.franke.nau.edu/.

 

 

 

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