16 May, 2022

“Trust shapes our worlds and connects us with the past and future. When organisations are bestowed the heavy crown of ‘hero’ trust, design and communication need to work together to trigger and shape trusting moments to guide action,” Prof Amisha Mehta, QUT.

“Enterprises which trust employees with more responsibility and higher salaries are able to upskill work, stabilise employee’s schedules and pay significantly more than the competition. The puzzle is then, why don’t we see more firms adopting these mutually beneficial strategies?” Hahzir Rahmandad, MIT Sloan.

The Future Enterprise series two has continued to delve into cultural attributes organisations need for the future.

Jointly presented by MIT Sloan School of Management and QUT Business school, our global experts explored The Trusted Enterprise.

Moderator MIT Sloan’s Stuart Krusell set the tone for the webinar, opening with, “Trust is a word with a lot of meaning, impacting relationships from personal to professional, and from individuals to organisations.

“It’s also a concept that’s taken a bit of a hit lately, replaced by suspicion and, even worse, indifference.”

Professor Amisha Mehta from QUT and Hazhir Rahmandad from MIT Sloan shared their insights into building a trusted enterprise and cultivating trust for organisational success.

Establish trust or distrust

Prof Amisha Mehta introduced the importance of trust as it, “shapes our worlds and connects us with the past and future.”

The current trends of diminishing trust and the rising distrust has created two opposing conditions.

“Distrust creates room for alternative sources that not only challenge traditional authorities but operate without regulation in multiple domains including weather, vaccination policies, political agendas, war, and sovereignty,” she shared.

“We know that when such matters are contested spaces, how an organisation, institution, or leader communicates is critical.”

“Success in communicating within the context of distrust is as much about the quality and believability of the information we share as well as who and why we are as an organisation,” Prof Mehta outlined.

Trust an an organisational glue

Hazhir Rahmandad continued the exploration of trust, explaining that, “For some strategies, trust is the glue that holds the strategy together.”

Rahmandad outlined that trust results in a mutually beneficial relationship between employees and employers.

Practices that increase employee skill, motivation and experience are mutually beneficial, however are often not widely adopted.

His research has found that enterprises which trust employees with more responsibility and higher salaries are able to upskill work, stabilise employee’s schedules and pay significantly more than the competition.

“The puzzle is then, why don’t we see more firms adopting these mutually beneficial strategies?” Rahmandad asked.
He explained that this is where trust enters the equation. Strategies that invest in and involve employees rely on a mutual commitment.

“The terms of this commitment are that employees will do what they think is best for the organisation, rather than a self-focused, localised optimisation,” he shared.

“So, they engage with work more fully, solve problems creatively, and in general do the best they can.

“In return, the firm promises to share the gains.”

Rahmandad also highlighted that it only takes small signals from employers or employees to break trust, which is why trust should be constantly nurtured.

Understand hero vs zero trust

Prof Mehta described two trust states: zero trust or hero trust.

Zero trust assumes no trust among parties, requiring organisations to design their systems for mutual controllability and transparency, which requires significant resource commitment.

Contrary to this philosophy is hero trust, which is also not an ideal archetype. Risk research has shown that too much trust in an organisation or risk mitigation can reduce risk perceptions and diminish preparedness for natural hazards.

“When organisations are bestowed the heavy crown of ‘hero’ trust, design and communication need to work together to trigger and shape trusting moments to guide action,” she said.

Demonstrate trust towards employees

Rahmandad explained that the first step in building internal trust is showing you, “genuinely care about employees and communicating that every chance you get.”

While that care shows up in salary and benefits, it also is “critically inferred” in how organisations deal with tough situations.

He also outlined that management needs to trust employees first and be tolerant of occasional trust violations.

“The power imbalance between management and employees means you have much more leverage,” he shared.

When you don’t use this power, such as monitoring employees’ time, you’re signalling trust.

Rahmandad also outlined that “honest communication is key.”

When making choices where you can’t satisfy every employee, you need to communicate your rationale and acknowledge where it may not meet expectations.

Promote inclusion

Both panellists stated that inclusivity is important in signalling trust.

“If you can’t have an inclusive organisation, and if people don’t get the sense that they belong, that will start to erode trust broadly beyond those minorities affected,” Rahmandad shared.

“Strategies designed to build trust should be sensitive to build diversity and inclusion.”

Prof Mehta echoed this, outlining that it’s important for organisations to enhance inclusivity.

“Everyone has different stories about the way that they connect with an organisation and to a society,” she said.

“And I think it’s trying to create space to share those stories and use those stories to drive an organisation forward as well.”

Embrace inclusivity in your organisation to continue nurturing culture. Join us for The Inclusive Enterprise on Thursday 19 May 7:45am AEST/Wednesday 18 May 5:45pm EDT, to explore how leaders can initiate inclusion and scale it for meaningful impact in their organisations.

Register here: https://www.qut.edu.au/engage/the-future-enterprise-webinar-series/webinar-the-inclusive-enterprise

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