Overcoming the Organizational Trust Crisis, by Jonathan H. Westover PhD

Abstract: This article explores how organizational leaders can overcome issues of eroded trust within their companies. The article argues that trust is more critical than ever for effective leadership and strong business performance. However, recent scandals and a lack of faith in institutions have left many firms facing a "trust crisis." Drawing on academic research and the author's consulting experience, key constructs of trust like competence, consistency, benevolence and integrity are defined. Research highlighting declining trust metrics is presented. The article then provides practical strategies leaders can implement to rebuild trust from the ground up. This involves demonstrating abilities and following through on commitments, communicating caring for stakeholders, and engaging all employee levels. Ongoing measurement and refinement of trust-building initiatives is also deemed important. The overarching message is that restoring confidence requires long-term effort across an organization.

Episode Transcript

(00:00):
Overcoming the Organizational Trust Crisis Building and maintaining trust is more important than ever in today's complex business environment.

(00:08):
While trust has always been a crucial component of effective leadership and organizational performance,
recent scandals and a growing lack of faith in institutions have left many companies facing what some have called a "trust crisis.
" I have seen firsthand the impacts of eroded trust—from disengaged employees to dissatisfied customers to lagging innovation.

(00:31):
However, I have also witnessed how rebuilding trust can revitalize cultures and boost bottom lines.
Today we will explore how leaders can begin to overcome the trust crisis within their own organizations.
Defining and Measuring the Crisis Before diving into solutions,
it's important to properly define and measure the scope of the issue.

(00:54):
Academic research provides useful frameworks for understanding trust at both the interpersonal and institutional levels.
At the core,trust involves a willingness to be vulnerable to another party based on positive expectations of their intentions or behaviors (Rousseau,
Sitkin,Burt,& Camerer,1998).

(01:16):
On an individual level,trust between employees and management is built through competence,
benevolence,and integrity (Mayer,Davis,& Schoorman,
1995).
Institutionally,trust depends on perceptions of ability,
consistency,openness,concern for stakeholders,and reliability over time (Covey & Link,

(01:40):
2012;
Schoorman, Mayer, & Davis, 2007).
Recent studies paint a troubling picture of declining trust in many organizations.
According to the Edelman Trust Barometer,which measures trust across industries globally,
trust dropped significantly between 2019 and 2022 across government,

(02:04):
business,media,and NGOs in many countries (Edelman,
2022).
Within companies,only about half of employees strongly agree their leaders act with honesty and integrity (Gallup,
2022).
Other researchers have found trust in leadership directly correlates with employee engagement,

(02:27):
loyalty,and performance (Fulmer & Gelfand,2012).
Quantifying these dynamics is an important first step for leaders looking to understand the depth of the trust challenge within their own walls.
Internal surveys,focus groups,and one-on-one conversations can provide valuable insights into how trust is experienced across levels and segments of the workforce.

(02:51):
Cultivating Competence and Consistency With trust deficits properly diagnosed,
leaders must roll up their sleeves and get to work on rebuilding it from the ground up.
Research suggests the best place to start is by demonstrating competence and consistency—two factors shown to be critical for both interpersonal and institutional trust (Mayer et al.

(03:14):
, 1995;
Schoorman et al.
, 2007).
At the core,employees and stakeholders want to feel confident in a leader's ability to capably steer the organization toward shared goals over the long run.

With this in mind,here are some practical actions leaders can take (03:30):
Be transparent about strengths and weaknesses.
Admit past errors, clarify learnings, and emphasize continuous improvement efforts.
This builds perceptions of fallibility and growth.
Over-communicate future plans and priorities.

(03:51):
Provide regular updates on strategy,priorities,initiatives,
performance,and challenges via multiple accessible channels.
Consistency and accessibility build confidence.
Lead with facts, not platitudes.
Back up communications with relevant data, details, and realistic timelines vs vague promises.

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Transparency bolsters perceptions of competence.
Define clear roles and responsibilities.
Ensure accountability is distributed appropriately and responsibilities are well-understood across levels.
This promotes smooth cross-functional collaboration and delivery.
Celebrate small wins consistently.

(04:36):
Recognize and share progress publicly to build momentum and proof that goals are moving in the right direction over time.
The key is maintaining a realistic yet consistently positive tone that builds confidence without complacency.
Research shows even small inconsistencies can undermine trust if not addressed transparently and promptly (Kim et al.

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, 2004).
Leaders must walk the talk every day to cultivate steady trust capital.
Focusing on Benevolence and Integrity While building perceptions of competency and consistency is crucial,
trust also hinges on how stakeholders experience an organization's intentions and values in practice.

(05:20):
Leaders must communicate care for people as much as profits if they hope to earn the benefit of the doubt during challenges (Mayer et al.
, 1995).

Some ideas for cultivating benevolence and integrity include (05:31):
Lead with empathy.
Actively listen to understand concerns and experiences.
Communicate care for people's wellbeing above all else.
Align actions with values.
Live the organization's stated values in all decisions, not just marketing materials.

(05:54):
integrity comes from walking the talk.
Share struggles and lessons learned.
Admitting vulnerabilities models humility and gains respect.
It also prevents surprises by keeping stakeholders in the loop.
Make diversity, equity and inclusion real priorities.
Back up anti-discrimination policies with clear processes, training, and accountability.

(06:20):
Perceptions of fairness are key.
Involve stakeholders proactively.
Solicit input from all levels regularly to understand perspectives.
Co-create solutions where possible to foster buy-in.
Celebrate social and community impacts.
Share examples of how the organization improves lives and contributes to society’s wellbeing.

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This builds positive associations.
Overall,trust thrives when leaders establish caring,
moral bonds between people and demonstrate that core principles guide all levels of decision making,
not just public relations.
Integrity emerges from consistent actions, not just aspirational words.

(07:06):
Engaging the Frontlines and Middle Ranks While top executives set the tone,
research suggests middle managers and frontline teams must also play active trust-building roles if efforts are to take root organization-wide (Fulmer & Gelfand,
2012).

Fortunately, there are ways leaders can empower others to contribute (07:24):
Provide trust training.
Educate all levels on concepts,best practices,and their unique ability to impact trust through daily interactions.
Incentivize relationship-building.
Recognize managers and individual contributors who develop strong one-on-one trust bonds with peers,

(07:49):
direct reports,and internal customers.
Delegate transparency.
Empower middle layers to have transparent discussions with direct teams about progress,
challenges,future plans,and strategy.
Equip problem-solvers.
Give frontlines tools and autonomy to resolve client/customer problems on the spot to build confidence in competence.

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Gather insider insights.
Form communication cadences where all employee levels can anonymously share feedback and co-design solutions.
When trust is a shared responsibility cultivated across hierarchies,
redevelopment efforts gain exponential momentum.
Frontline trust ambassadors become powerful brand supporters and change agents.

(08:38):
Measuring Impact and Continuous Improvement Sustained progress requires ongoing measurement,
reflection,and refinement.
To truly overcome ingrained trust issues,the work must become an endless journey of continuous learning and improvement.

Some ideas include (08:55):
Repeat trust surveys annually.
Benchmark perceptions and isolate areas needing most attention.
Celebrate gains.
Conduct stay interviews.
Understand why top performers remain loyal and how their trust has grown over time.
Ask exit interviews about trust.

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Identify disconnects or any warnings that slipped through the cracks.
Audit trust-building initiatives.
Ensure programs are delivering intended impacts or require adjustment.
Host trust roundtables.
Bring diverse groups together regularly to co-design the next phase of the trust journey.

(09:38):
Pilot test new trust practices.
Experiment, get feedback, and refine before broad implementation.
Recognize trust-building champions.
Thank those reinforcing the message and serving as role models every day.
Rebuilding deeply eroded trust takes relentless dedication,

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but even small wins help shift perceptions and culture over the long run.
Measurement keeps efforts impact-focused so the organization continuously climbs to new trust heights.
Conclusion In today's changing world, trust is more vital than ever for thriving organizations.
There are no quick fixes to ingrained trust issues—the work requires holistic,

(10:23):
long-term commitment from the C-suite on down.
However,leaders with the determination to restore confidence one step at a time through competence,
integrity,compassion and collaboration can slowly but surely overcome even the deepest trust crises.
While the specific actions may vary,the underlying principles of transparency,

(10:46):
consistency,caring and accountability remain constants.
For consultants and researchers,contributing research-backed frameworks alongside personalized,
industry-specific guidance is key to empowering positive change.
With diligence and community,any organization can emerge from its trust crisis stronger and more united than before.

(11:10):
The journey begins today.