Leaders in the C-Suite are responsible for setting the strategic path a company must follow to achieve its desired performance and for determining the means by which those goals will be accomplished.
However, achieving those goals and retaining their position and power to get those goals accomplished is not possible if they do not have the trust of the same stakeholders who hired them, as well as their employees and executive team.
As Marc Benioff, owner/ founder and CEO of Salesforce said in an CNBC interview, regarding behaviors, “If trust is not your highest value… your employees and executives are going to walk out.”
A study conducted by Kurt Dirks at Washington University in St. Louis and Donald L. Ferrin at State University of New York at Buffalo revealed that trust in leadership positively affects employees’ job performance, overall job satisfaction, and commitment to their organizations.
People evaluate a leaders’ trustworthiness on competence, motives, the means to accomplish and set directives and the impact, the actions they take in leading the company and taking action in challenging situations and doing the right thing.
While more leaders are let go from their companies because of ethics issues, we forget the other factors that go into building trust. Click To TweetI’ve talked often, both in my presentations and posts about trust being the cornerstone of leadership. Establishing trust takes time, losing trust is instantaneous, and regaining it is a remote possibility.
So, what is this trust we keep talking about? And what does it take to establish and keep it? Trust is defined as a firm belief in the reliability, truth, ability, or strength of someone or something. While we emphasize reliability and truth, trust is more complex than just being reliable. According to surveys taken by the Leadership Challenge team, James Kouzes and Barry Posner, a key ingredient in the trust mix which we don’t focus as much on is competence, the ability or strength of someone or something.
Leaders are often hired because of their competency. They have exhibited the skills needed to take the company to peak performance. If they’ve come up through the ranks their ability to demonstrate the competence needed in their new position puts them under a microscope. If their lack of skills is pronounced, they lose trust. Without the knowledge and skills needed to get the job done better than the last CEO, respect is lost, and trust eroded. The new kid on the block is under constant watch.
In my own career, I’ve observed this time and time again. It results in managers who knock their leaders and employees who find work-arounds. Without the competency to effectively achieve the mission a leader loses ground. Transparency is lost and with-it accountability.
Performance goals are not met, conflicting directives are given, teamwork goes by the ways and productivity and profitability go down. The end result, shareholder and stakeholder revolt – the leader is terminated. According to Daniel Schauber, founder of Exechange, a service that tracks executive departures, more than one in two CEOs stepped down under high pressure to do so.”
The storyline is filled with news of leaders who exhibited incompetence in their directives, to the detriment of the company’s bottom line… Sandy Lerner at Cisco, Rob Kalin of Etsy, David Neeleman of Jet Blue, and the list goes on.
Even leaders like Carly Fiorino, the former CEO of Hewlett Packard, competency comes under scrutiny when what appears to be incompetent decisions are made. While the jury is still out, she is soundly criticized for some of her decisions such as the Compaq merger.
A competent leader does not have to continually prove him or herself. An empowered team results, which follows, adds to and carries out the directives the leader has laid out. Competency builds trust, the company is in good hands, sound decisions are made because they know their industry and have the vision to lead it to even higher performance and profitability.
What are some key steps a leader can take to build trust?
According to highly respected management/ leadership author and consultant John Maxwell, leading by example and demonstrating that you can be trusted is critical.
He says, “A leader knows the way, goes the way and shows the way.” Nothing speaks more loudly when leaders’ behaviors model their actions. This not only influences your employees’ actions but can also drive employee results. It is also important that you are consistent. Don’t just talk the talk, walk the walk. Do what you say you are going to do, not just sometimes but all the time. This builds trust, not just for today but for years to come.
Richard Bowen is widely known as the Citigroup whistleblower. As Business Chief Underwriter for Citigroup during the housing bubble financial crisis meltdown, he repeatedly warned Citi executive management and the board about fraudulent behavior within the organization. The company certified poor mortgages as quality mortgages and sold them to Fannie Mae, Freddie Mac and other investors.
