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The relationship between trust and performance
It’s no secret that teams who trust each other achieve more. Companies with a high level of trust benefit from greater employee engagement and better financial performance. Meanwhile, those with trust issues suffer from decreased productivity, high turnover rates, and lower profits.
The level of trust within your company can have a profound impact on business results. But just how interlaced is trust and performance?
We take a look at the relationship between these two factors, and provide you with useful tips to build a strong culture of trust within your organisation.
The link between trust and performance
Time and time again, research has shown that trust levels between managers and employees is the key defining characteristic of the world’s best workplaces.
However, building trust in the workplace contributes to more than just company culture — it’s a hard economic driver. Studies in the US have also shown that high-trust organisations are 2.5 times more likely to be high-performing revenue companies when compared to their low-trust counterparts.
Why is this?
The reason is simple: leaders who focus on building trust in teams are more likely to have employees who are engaged in their roles and work well as a team. According to research from The Great Place to Work Institute and Fortune, companies that rank in the Top 100 Best Companies to Work For have a voluntary turnover rate that’s half the rate of their industry peers. What’s more, employees that trust each other are more productive and also likely to collaborate to problem-solve.
How to build trust in a team
It takes time to establish a high level of trust amongst employees, and even longer to fix a trust issue. However, the good news is that it can be fixed — and the benefits to team morale and performance are undeniable.
The four tips below will help you create a culture where employees feel safe, supported and respected, and in turn, respect and support you and the business.
Empower staff through meaningful participation
Mutual trust and respect are built through reciprocity. It’s simple: employees who feel trusted will trust you more. That’s why it’s important to empower your team by regularly giving away your authority.
Delegate responsibilities to individuals and encourage a collective team decision-making process whenever possible. Let’s say you have an important decision to make on a project. Rather than going at it alone, consult your team for their feedback, and actively show them that you’ve incorporated their opinions into your decision-making process.
Follow through on commitments with actions
“Do what you say and say what you do.” Going back on your word is a sure-fire way to create doubt and break your team’s trust, fast. However, if you practice what you preach, employees will believe you’re reliable and true to your word, and trust in your leadership.
Building trust as a leader is done one step, one conversation and one action at a time. Don’t make grand promises to employees in the hopes of pleasing or showing off to them as a way to build trust. Instead, focus on committing to key actions and delivering on them.
One of the classic ‘trust in the workplace’ examples is when an employee asks for career development opportunities. If you promise to help them, make good on your word and proactively come back with proposals or opportunities instead of waiting for them to follow up. This way, they know that when you say you’ll do something, you mean it.
Encourage authentic and transparent communication
Even the best leaders fail. The difference between trustworthy leaders and others lies in their response to failure. If you try to hide mistakes from your team, they’ll feel like you don’t trust them with important information — or even worse, that you don’t respect them enough to tell them the truth.
Being authentic, vulnerable and transparent with your team helps build your credibility and humanises you. Own your mistakes and tackle difficult issues in a timely manner. Be clear on what went wrong, what could have been done better and highlight how you’ll improve next time. At the same time, encourage your team to communicate their thoughts on the matter, and provide you with constructive feedback for the future.
Praise publicly, correct privately
An essential component of trust is a feeling of psychological safety. If your employees feel you’ll throw them under the bus or humiliate them in front of their peers, they’ll be less likely to trust you as a leader — and might even lie to avoid getting caught out in the future.
Follow the principles of praising publicly and correcting privately. In team settings, commend employees on what they did well. If a project didn’t go as planned and you’re conducting a post-mortem, adopt a constructive approach problem-solving — “What can we do better next time?” — rather than pointing fingers at specific team members or resorting to blame.
This fosters a feeling of support and trust in your team.