The Age of Mistrust

Today, it seems that trust of workplace leaders in the USA is at a very low ebb. According to reports, many American employees plan to look for a new job when the economy stabilizes. Those that do cite low trust of their workplace, senior leaders, direct bosses, and even co-workers as a primary driver.

Two recent research studies have noted this “age of mistrust.” According to Deloitte’s 2010 Ethics & Workplace Survey, one-third of employed Americans plan to look for a new job when the economy gets better. Of this group, 48 percent say that a lack of honest communication from company leaders is their primary reason for that decision. This survey also reports that 65 percent of Fortune 1000 executives who are concerned with the upcoming “talent drain” believe trust is a factor in this potential voluntary turnover.

Maritz Research’s recent workplace study echo’s the Deloitte findings. According to the Maritz poll, only 11 percent of American employees strongly agree that their managers show consistency between their words and their actions. Only 7 percent of employees strongly agree that they trust senior leaders to look out for their best interest (!) and only 7 percent believe their co-workers will do so.

The Maritz poll also found that about 20% of respondents do not believe that their company’s leader is completely honest and ethical; fully 25% disagree that they trust management to make the right decisions in times of uncertainty. Of those employees who do not trust company management, only 3% look forward to coming to work every day!

Behavioral Integrity: A Proven Practice for Building Trust

In September 2002, Cornell University professor Dr. Tony Simons published an article, The High Cost of Lost Trust, in the Harvard Business Review. In that article, Simons describes his team’s efforts to examine a specific hypothesis (“Employee commitment drives customer service”) in the US operations of a major hotel chain. They interviewed over 7,000 employees at nearly 80 properties. What they found was that, indeed, employee commitment drives customer service, but, most critically, a leader’s behavioral integrity drives that and more.

Simons’ team defines behavioral integrity as “managers keeping their promises and demonstrating espoused values.” Their research methods and analysis discovered:

  1. When employees believe their bosses have behavioral integrity, their commitment goes up.
  2. As employee commitment goes up, employees willingly demonstrate discretionary effort. Employees are more proactive, more present, and more productive with the application of their discretionary energy.
  3. Employee discretionary effort is visible to and highly valued by customers. Customers respond by staying more frequently, staying longer, eating on property, etc.
  4. Those customer behaviors generate higher profits. Significantly higher profits!

Dr. Simons’ team created an assessment that measured behavioral integrity on a five point scale. Their analysis found that a 1/8 point gain on this scale generated a profit gain of 2.5% of annual revenues . . . which translated into $250K for each hotel! This study made an important link – one that had not been demonstrated before: manager behavior, specifically keeping promises and demonstrating company values, generates hard dollar profits.

Simons’ work continues at The Integrity Dividend with a book, programs, blog, and more.

Sharon Allen, Deloitte’s chairman of the board, notes that, by focusing on talent management and retention strategies, “executives may be able to reduce attrition.” She goes on to state, “Establishing and enforcing a values-based culture will ultimately help cultivate employee trust.

We’ve seen significant positive impact of behavioral integrity in our client’s evolving organizational cultures. If you need help with the creation of a values-aligned workplace, reach out to us.

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