How trust can be a business tool for monopolist entrepreneur


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Source: Google image

In this article we are going to look into pretty common and mostly ignored business fundamental which is called TRUST. Without trust there is will be no reputation, no brand, no sales, no customer, no retention, so revenue, and no growth.

Most successful entrepreneurs have learned it early in their career and mastered themselves in creating and maintaining a trust whether in person to person or online marketing approach.

So today we are going to dig deeper into this vital part of the business. It will be up to you how you can use it as its very sensitive tool, misuse can damage you deeply even some time push you out of business.

Take away
  1. Understanding of Trust
  2. Advantage of Trust
  3. Variables of Trust
  4. Principle of Trust
  5. Gamut of Trust
  6. Where we trust?
  7. The alternate of Trust
  8. Trust and Control
  9. Trust and Fear
  10. Increasing Trust
  11. Rapid Trust 
  12. Group Trust
  13. Creating Trust in a Company
  14. Economics of Trust
  15. Low Trust or No Trust
  16. How to create Trust?
  17. Building online Trust
  18. Conclusion


Understanding of Trust


Trust is both an emotional and a logical act. Emotionally, it is where you expose your vulnerabilities to people, but believing they will not take advantage of your openness. 

Logically, it is where you have assessed the probabilities of gain and loss, calculating expected utility based on hard performance data, and concluded that the person in question will behave in a predictable manner. 

In practice, trust is a bit of both. I trust you because I have experienced your trustworthiness and because I have faith in human nature.

We feel trust. Emotions associated with trust include companionship, friendship, love, agreement, relaxation, comfort.



Advantages of Trust

If people with whom you are interacting might be untrustworthy, then there can be high risks to you in trusting them. So why should you stick your neck out and trust others?
Cost of distrust

Not trusting people has benefits in that you reduce the risks of being deceived. But there are risks of not trusting also. For example, if you do not trust a person then they may well not trust you.

People often end up acting in the way you treat them. Consistently treating a person as being untrustworthy may lead to them acting in this way. At the very least they will feel unhappy about this unfair treatment and be less inclined to associate with you.

When you do not do something, the 'opportunity cost' is the cost in terms of what is lost. In not trusting, the opportunity cost is that you will not get the things you might have gained if you had trusted others.

Not trusting others is an isolating action. If you do not get close to others you will not have friends to call on when you are troubled.

Distrusting also adds the cost of stress in terms of the personal worry and anxiety about what the other people may do. 

Bonding

Bonding is the connection of identity between two or more people where, in some sense, each person connects their 'self' to that of the other person or group. People who are bonded care about one another and naturally trust one another.

Bonding also gains the benefit of feeling good. It is nice to have friends and feel you can trust and rely on other people. It is also nice to be trusted and that others accept you as you are and do not question or challenge everything you say.

Changing Minds

Whether you are closely bonded with another person or simply have gained a certain amount of trust, you will find it far easier to influence them and to change their mind.

Trust is effectively the 'gateway' to persuasion. If you do not have the trust of the other person, then they will not really listen to you or consider your persuasive arguments.

Society

Society at large also benefits from the trust, which is sometimes called 'social capital'. In a healthy financial economy, there is plenty of cash circulating. In the same way, in a healthy society, there is plenty of trusts and people feel safe and comfortable, even in the company of strangers.

In practice

In practice, you have to trust some people and there are things you can do to work with others.

Believe in benevolence

If you believe that people are all selfish then you will treat them as if they were so, which may make them act in untrustworthy and malevolent ways.

If, on the other hand, you believe people are basically good and benevolent, then you will treat them this trusting way and they will be more likely to be trustworthy in practice.

Tit for tat

In an early computer artificial intelligence game about trust, it was found (in a program called 'tit for tat') that starting with trust, but then echoing the other side was an easy and effective strategy. 

Basically what you do is to start out trusting and trustworthy, but then if they break that trust you act as if they were untrustworthy until they do something to demonstrate trust, then you start from the beginning again with trust.

Trust, but verify

In the words of Ronald Reagan about cold-war nuclear negotiations, whilst it is good to trust, it helps a lot if you can get evidence that the other side is indeed acting in a trustworthy manner. If they are indeed doing so, then they should be quite open about allowing inspection, which again increases trust.

Agreement about how this works is good for trust. By negotiating an easy verification, you can gain the benefits of trust with little of the cost of distrust.

Lie detection and trusters

You might think that people who are highly trusting would be very poor at detecting lies, yet strangely they are often better than average. Carter and Weber (2010) found that high trusters tend to be better at detecting lies.

This may be because people who trust expose themselves to exploitation, and so need to develop better 'radar' for detecting lies. Trustees also tend to be more open and empathetic and so more easily understand what others are feeling, including liars.

Whilst there is a cost of a trust being betrayed and it may be easy to become disillusioned, the cost of not trusting can be much more.

So work towards being trustworthy and helping others to trust more. Whilst you should not trust blindly, you should also avoid the paranoia of blind distrust. As the research shows, you can both trust and detect deception.

When you seek to persuade, develop trust first. Show that you are reliable, honest and have high integrity. When others know you are trustworthy, they will more easily listen to you and seriously consider your suggestions.



Variable of Trust

There are a number of different ways we can define trust. Here are the variables of trust and consequent definitions.

Predictability

It is a normal part of the human condition to be constantly forecasting ahead. We build internal models of the world based both on our experiences and what others tell us, and then use these to guess what will happen next. This allows us to spot and prepare for threats and also make plans to achieve our longer-term goals.

The greatest unpredictability is at 50%; a reliable enemy can be preferable to an unpredictable friend, as at least we know where we are with them.

Definition 1: Trust means being able to predict what other people will do and what situations will occur. If we can surround ourselves with people we trust, then we can create a safe present and an even better future.

Value exchange

Most of what we do with other people is based on an exchange, which is the basis for all businesses as well as simple relationships. At its simplest, it is an exchange of goods. I will swap you two sheep for one cow. It is easy to calculate the value of such material bargaining. 

Things get more complex when less tangible forces come into play. A parent exchanges attention for love. A company exchanges not only pay but good working conditions for the intellectual and manual efforts of its workforce.

Value exchange works because of we each value things differently. If I have a whole flock of sheep but no milk, then I can do business with a person who has a herd of cows but no clothes. This principle of reciprocity is what binds societies together.

Trust in value exchange occurs when we do not know fully whether what we are receiving is what we expect. When we buy a car, don’t want to be sold a ringer which the seller knows is faulty. When I get advice in business, I want it to be based on facts, not wild opinions.

Definition 2: Trust means making an exchange with someone when you do not have full knowledge about them, their intent and the things they are offering to you.

Delayed reciprocity


An exchange is not just about an immediate swapping of cows and sheep or hugs and kisses. What makes companies and societies really work is that something is given now, but the return is paid back some time in the future. 

The advantage of this is that we can create a more flexible environment, where you can get what you need when you need it, rather than having to save up for it.

Trust now becomes particularly important, because otherwise, we are giving something for nothing. The delay we have placed in the reciprocal arrangement adds a high level of uncertainty which we need to mitigate through trust.

What is often called the ‘golden rule’ is a simple formula for creating trust. ‘Do unto others as you would have them do unto you.’ It sets up the dynamic for my giving you something now with the hope of getting back some unspecified thing in the indeterminate future.

Definition 3: Trust means giving something now with an expectation that it will be repaid, possibly in some unspecified way at some unspecified time in the future.

Exposed vulnerabilities

When we trust other people, we may not only be giving them something in hope of getting something else back in the future, we may also be exposing ourselves in a way that they can take advantage of our vulnerabilities. 

If I buy a car from you and I do not know a good price, you can lie to me so you get a better bargain. If I tell you in confidence about the problems I am having with work, you could use this to further your own career at my expense.

Although the threat of retribution or projected feelings of guilt can counteract your temptation to abuse my exposed vulnerabilities, if you succumb I still get hurt and may still end up with the shorter stick. For our transaction to complete successfully, I must be able to trust that such agonies will not come to pass.

Definition 4: Trust means enabling other people to take advantage of your vulnerabilities—but expecting that they will not do this.

So learn about trust, how it works and how to build it. If you do it well, other people will give you the earth. If you betray them, they will hunt you to the ends of the earth.



Principle of Trust


If I trust you, I will accept what you say is true and expose my vulnerabilities to you. Trust is the basic unit of social glue that enables us to interact without fear.

No Harm

I will trust and work with people who do not harm me. You can be passive or active in your approach to harm.

Passive no-harm is when you do not actively or deliberately act to harm me. However, you might still stand by and let others harm me, so active no-harm is where you act positively to protect me from harm. Of course, I will trust an active protector even more than a passive 'no harm' friend.


Reliability

If you always do what you say you are going to do, it makes your behavior very predictable, which means I can feel even safer around you. It also means that if I ask you to do something I do not need to keep checking up on you.

Confidence

I do not know everything and may lean on your expertise. If you always tell me the truth then I know that I can rely on what you say and not have to do any further checking up.

Truth and reliability also extend to the whole notion of 'integrity', where a person is true to their values and follows common social norms.



Gamut of Trust 

We don't trust all people equally and we don't all approach trust in the same way. There is an overall spectrum, ranging from blind faith to paranoia. If we can identify where the other person is situated


  1. Blind Faith >  Everyone's trustworthy  >Trust without evidence 
  2. Reasonable Trust > Some are trustworthy > Trust with evidence 
  3. Paranoia>Nobody's trustworthy > Distrust without evidence
Blind Faith

At one end of the trust, a spectrum is blind faith, where the naive will happily do whatever anyone asks of them. They assume that everyone else is trustworthy, even in the face overwhelming evidence.

Few of us are as foolish as to be blindly faithful in all other people, though many of us do have blind spots. I will blindly believe my football team can beat all comers or that my great website will attract millions of admirers.

Paranoia

At the opposite end to blind faith is paranoia. The paranoid person trusts nobody, and even assumes that 'everyone is out to get them'. They distrust without evidence.

As with blind faith, paranoia can be broad or narrow in focus. I can be paranoid about one person or a whole football team.

Reasonable trust

Somewhere in the middle is a reasonable position, where evidence is required before I will trust other people.

Find out where the other person is situated along the spectrum, and act accordingly. The more paranoid the other person is, the more you will need to spend time building trust.

You may also be able to move the person to a different context in which they are less paranoid. For example, a meeting in your office with a supplier may immediately make them feel threatened. A neutral location such as a restaurant may lead them to a more reasonable position.

You may even decide to abandon the persuasion if the other person remains at the higher end of the spectrum. If you have alternatives to the persuasion, they may be an easier course!


Where do we trust?

Beyond the religious maxim ‘In God do I trust’, perhaps the questions should be ‘Where must we trust?’ 

Some situation forces us to either trust or leave. ‘If you cant’ stand the heat, get out of the kitchen’ comes to mind. The heat in groups is about collaborating such that an acceptable system of value exchange is maintained, where even if people don’t care too much for one another, they can still get on without terminal conflict.

Frequent contact

Where people are forced together, where they have some structural ties of location in common, they have to get on in some form. Their enforced close relationship means that they must discover how to establish and use a trust.

Families have specific ties. Blood is thicker than water, and all that. You can get rid of friends, but you cannot easily change your relationship with your brother or cousin. Families can be acrimonious, but on the whole, they tend to be harmonious, especially when challenged from outside.

People who live in close proximity, whether they are prisoners, neighbors or workmates may have more choice than families. Nevertheless, they must, if they are to co-exist, development agreement and trust around how they share their time and space.

Common goals

Where people have common goals and objectives, where they have interdependencies and where they can obtain synergies from collaboration, development of a trusting relationship is clearly beneficial to all parties.

Beyond collaborative work groups, other groups such as professional organizations seek to create trust within their membership and may act as trust brokers with other organizations.

Single source

Where we need information and there is only one place to get it, then we are obliged to trust that source. Organizations that set themselves up as sources of knowledge include universities, consultancies, and professional organizations. Their brand name aims to persuade us that they can be trusted.

So to develop trust with people by staying in touch, calling up at the unexpected time just to be friendly as well as scheduling a regular contact. Also, seek to demonstrate that you are aiming at the same stars as them. Also be aware of the brand effect and use it as appropriate.



The substitutes of Trust

What do you do when you don't fully trust someone, yet you have to work with them? This is a question facing many people in work and social situations every day. The answer is that you use trust substitutes, various methods that compensate for the lack of trust and help mitigate the risks.


Rules

There are rules of all kinds that specify how we must behave, from social norm through company procedures to national legislation. Whilst rules themselves do not create trust, they do define the boundary between trustworthy and untrustworthy actions.

When we join a new group, whether it is a new employer or moving to a new town, there is a period of anxiety all around as we try to learn the rules and those around us try to teach us the rules.

Rules can be hard and soft. Hard rules must always be obeyed. Soft rules are more open to interpretation. Knowing which is which can be very important.

Agreements

Similar to rules are agreements. These are explicit contracts between two parties that can range from one person promising to do something for someone else to legally binding contracts between two companies.

Companies use 'performance agreements/objectives' and minuted actions with employees to enable managers to check that their people are doing what is needed (rather than trusting them to do so). If all managers needed to do was to say 'this is what is wanted', then only a few would be needed.

Monitoring

One of the biggest costs of distrust is in the checking and monitoring that one does when others are not fully trusted. This can range from an informal 'keeping an eye on things' through formal and detailed reviews, tests and other assessments.

Entire professions, such as auditing and inspecting, are dedicated to monitoring activities. Many other professions, from management to policing, have to monitor as a major part of the job.

Consequences

When rules are broken, there are more rules for what happens. For a simple social faux pas, an apology is often all that is required, although serious or consistent transgression can lead to social exclusion. Likewise, companies can discipline or sack employees and countries can fine or incarcerate criminals.

Consequences define how hard or soft a rule is. If there are no consequences ever, then the 'rule' is not a rule (and may even bring other rules into disrepute).

It is the fear of consequences that keeps (or is intended to keep) people on track and acting in a trustworthy manner. Fear, however, has its own costs and can cause problems such as subtle revenge that can undermine long-term trust.

Third parties

A common substitute for trust is to engage a third party who acts either to create the trust or manage the lack of it. Thus, for example, warring couples may consult marriage guidance counselors and industrial disputants accept the judgment of a neutral arbitrator. An important aspect of this is that all distrusting parties trust the third party and may commit beforehand to accepting decisions and outcomes.

Third parties can also act on behalf of one side, such as when you hire an agent or lawyer who is better equipped to spot deception in particular areas. This can lead to a pyramid such as my lawyer dueling with your lawyer, and then these are going to a judge to get a final decision.

And...

Here are just a few of the many other ways that are used to compensate for lack of trust or seek to make people more trustworthy.

Hedging

A very common mitigation strategy is to spend time and effort preparing for problems that may never occur. Thus for example, if I suspect my boss may fire me, I will put effort into looking for another job.

Alliances

If we fear being attacked or dominated in some way, then we will typically put significant effort in defenses and power building. A strong form of power is being able to use the power of others. We thus spend time networking and building alliances which we can call on in our hour of need.

Rituals

Many rituals are intended to force people into particular ways of behaving, from weddings to rites of passage such as joining and graduation ceremonies.

Even when we shake hands we are demonstrating knowledge of a greeting ritual and inviting the other party to comply with the social process.

Arming

Although carrying weapons is not normal in many contexts in others it is, even in parts of western society, where violence is so common that people feel the need to protect themselves with potentially lethal force.


Trust and Control

Trust and control are very closely related, in particular how trusting people cede control and how betrayal leads to a strong control-based response.

Ceding trust

We all have a need for a sense of control. It is a fundamental driver of how we live. When we feel in control we can predict what may happen, change things to best suit us and cope with problems. Control gives us the power to achieve our needs and goals.

We get this sense of trust in two ways: we can take control or we can cede control. This is like driving the car or trusting the driver.

Ceding control allows others to have control over our lives. Trust is essential in order to sustain our sense of control when we cede control. When others have control, we are vulnerable. They could use their control of situations to achieve their goals at our expense or otherwise harm us.

Ceding control is often done with an assumption of care by the party who is taking control. I will trust you if you care for me. This is like a parent-child relationship where the parent has control but cares for the child, who trusts the parent to support them.

We cede control to many others, including governments, family, friends, and employers. We even trust strangers in the street and drivers on the road to decide and act in ways that will not harm us.

Betrayal and control

There is a paradox of control and trust. Trust leads to ceding of control, yet wielding of that control can lead to the loss of trust and, ultimately control. When others who we have trusted betray the trust we have placed in them, it destroys our sense of control and hence our trust.

A typical response to betrayals is to grab back control in order to protect oneself and also to punish the other person. A betrayed person typically seeks justice, and in doing so places himself in the control positions of police, judge and jury.

There is distinct potential for an extreme response to betrayal, which acts an encouragement of those to whom others have ceded control to refrain from breaking that trust. Personal values also discourage betrayal, including the general 'golden rule' of 'do to others as you would have them do to you'.

Social norms and cultural rules act to support trust and provide legitimization for restoration and punishment after a betrayal. This not only allows the betrayed person from grabbing back control but also encourages others to engage in the corrective action.

The operation of many relationships and workplaces can be understood through the locus of control and the dynamics of trust and betrayal. We cede control to employers but then lose trust in them as they seem not to care for us. This can lead to parent-child patterns, including sulking, spite and other dysfunctions in the relationship.

If you are changing the minds of others and you want them to trust you, show that you will not use the ceded power to them and work to provide ongoing evidence of your trustworthiness.

Also seek to provide visible confirmation that supports their sense of control, for example by giving them choices and involving them in decisions.

If you must trust others, then be sure of that trust or else retain enough control so you can take action if the trust is broken.



Trust and Fear

Trust and fear are often related. Where there is fear, there will be less trust. If you want to create trust, then reducing fear is an important activity.

Fear of others

Trust and fear are linked in the way we fear other people. If we do not fear a person then we will likely trust them far more.

Experience and uncertainty

If you beat me regularly, then my experience tells me that I should fear you. If a child is beaten they may develop a belief that adults and others are dangerous, are to be feared and so are not to be trusted.

This need only happen a few times, and maybe only once. If I cannot predict that you will never harm me, then I will not be able to fully trust you and will always be uncomfortable around you.

Power Imbalance

Power often includes the ability to harm another without fear of reprisals. When one person has more power than another, then they will likely trust them more. However, this is not necessarily the same in the reverse direction.

When a person is in a position of low power, they may well fear what the powerful person or people around them may do, and so they trust them less. 

This can be problematic in work situations and other authoritarian contexts where they have to obey commands. When a person complies with an order it does not mean they trust and do not fear the person giving the order.

The price of fear

Fear is a very expensive commodity. It is often used to gain short-term compliance but the price of fear is a loss of trust and at least an increase in transaction cost and maybe seeking of some other form of justice.

In fear-based organizations (and there are still many where managers regularly use fear-inducing threats) then productivity will be limited and subtle sabotage will create an undercurrent of organizational harm.

If you seek to increase trust then you must also seek to decrease fear. This is not always easy but can be done.

Increasing trust

To increase trust by decreasing fear, there is number of activities that can be used.

Balancing power

When power is imbalanced, then this can be rebalanced in a number of ways. One way is to gain representation, which is one thing that trade unions seek to do. You can also use formal or informal mentoring from those who are more sympathetic towards you and who can converse as equals with a person in power who may be causing fear and distrust.

'Empowerment' is a method that many firms seek to use (although implementations of this are not always very effective). The principle is to give more decisional power to people lower down the company tree, reducing the need to ask permission or gain approval for the use of resources.

Appreciating humanity

A simple method is to show a basic respect for the other person. An easy way to do this is to get to know them as a person. Learn about their family life, their interests, and fears.

This may be done through formal meetings, which is a method that a mediator might use. It can also be done through chatting at the coffee machine and other informal settings. Saying hello and smiling in the corridor helps. Sitting nearby also has a big effect if interactions are friendly.

Demonstrating care

In a similar way to an appreciation of the humanity of the other person, showing that you care about them has a strong effect. Passive care implements a 'do no harm' ethic that should be effective at decreasing fear. On a stronger note, active care positively encourages trust.

Other Factors

Many other Factors also used to build trust such as:-
  1. Doing no harm and actively seek to protect people, demonstrating that you care about them personally.
  2. Managing expectations and always keeping your promises.
  3. Always telling the truth and actively maintaining your reputation for integrity.





Rapid Trust 


Sometimes there is no time to build a trusting relationship, such as when a group of people are thrown together and must start work immediately. 

A classic example of this is on the movie set. Make-up artists, key grips, stunt-men and many others are all on the job from day one, with little or no ‘getting to know you’ sessions. They must work out their differences on the fly and blindly trust one another to do their jobs.

Characteristics of temporary systems

Temporary systems such as the movie set or organizational task force, where people are brought together to complete a given task, have common factors which may include:

  1. Many different skills, assembled by a contracting organization to perform a defined task.
  2. Limited history of working together and unlikely to work together ever again.
  3. Complex and non-standard tasks which are only partly understood.
  4. Interdependent tasks that require a high degree of collaboration.
  5. Tight timescales and a high cost of failure.
  6. Key factors that make for swift trust

Rapid trust does not just happen. There are factors in the environment which are preconditions by enabling and encourage trust to be given and used well.

Aligned activity

Linked overall goals, rewards, and penalties. By putting people in the same boat, such that they share the glories of reaching the shore and sink or swim together, they are forced to develop a system of trust.

Interdependence. 

If they are independent, no trust is needed. If some are more dependent on others, then power positions are created with a much less trusting environment.

Constrained environment

Time. If there is no time to develop trust slowly, the pace is forced. Slack time also gives space in which idle hands can be turned to selfish or non-productive activities.

Just-enough resources

There should be sufficient resources to do the job, otherwise, battles for the resource will erode trust. Too much resource is simply wasteful.

Non-person focus

Professional role focus. A focus on acting as and treating others as professionals leads to trust in their professional capabilities.

Task/process focus
Focusing on the task or process removes focus on the people. If there seems to be a personal problem, refocusing on the process and context that caused the problem is more productive and supports trust.

Trust broker

Hires, fires and leads the charge. A central person who recruits everyone is responsible for ensuring everyone is professional and can perform as above. If they are the chief ‘designer’ of the system (such as a movie director or project manager), they are a single point where issues of difference are clearly resolved.


Group Trust

What makes a group a group: Is it the similarities between the people in the group? Or is it their differences with people outside of the group? The answer is yes to both, but in practice, the second question is often more significant than the first.

In-group conditions


When a group forms, they will typically go through the formative ‘Form, Storm, Norm, Perform’ sequence, where they will typically divide their work up into trusted roles which they are individually best suited, such that they can together meet the larger group needs.

Just as individuals have beliefs, values, mental models and goals, so also will these develop in the group, and the trust within the group develop around these.

The primary ‘glue’ that holds the group together is the trust as defined within the group beliefs, values, etc.

The ultimate threat to breaking this in-group trust is rejection from the group, which is such a powerful motivator it has led to people abandoning their personal values, even to the point of killing other people.

Boundary conditions

Groups are not defined solely by their similarities and shared culture. They can be even more clearly defined by what is not in the group. A non-group person is immediately subject to a lower level of trust and will be scrutinized for other factors through which their potential behavior can be predicted.

Within the group, out-group people and other groups are often caricatured with exaggerated non-group personality factors such as stupidity or cruelty. These not only serve to isolate the group, they also emphasize the values, etc. of the group through which in-group trust is maintained.
Induction

Induction into a group can often be through a ritualized process, from the ancient practices of the Freemasons to the group beatings (and worse) of Los Angeles street gangs. Professional associations have similar practices, where entrants must submit to examination and regular financial payments.

A person that has had difficulty in joining a group will be less inclined to leave, as the ‘sunk cost’ of membership can never be recouped.

It is also a known psychological effect that we deduce our beliefs from our actions, and the neophyte will often deduce that they have accepted the group trust rules because of the actions that they took to join the group.
Boundary threat

When the group is threatened in some way, they will forget internal problems and band together against the threat. In these situations, in-group trust goes sharply up and out-group trust sharply down. Take for example a wartime situation.

The people under threat work closely and passionately together to defeat the enemy, often trusting an in-group person with their lives, even though no trust has been developed between them, other than their membership of the same group.

The opposite also occurs: when there is no threat, in-group bickering and schisms form and this threat from within can lead to the subdivision of the group. This threat often leads leaders to create crises and other threats that will heighten fears of damage to the group and lead to more cohesive, trusting behavior.
So what?

So manage your relationship with groups carefully. Act differently if you are an outside, but also seek to achieve the status of the trusted advisor.

When joining a group, be prepared to go through an induction ritual and work to demonstrate how you have adopted group rules and processes.



Creating Trust in a Company

The way an organization is designed can have a significant effect on the trust that is engendered within its walls. Organizational elements that affect trust include the softer side of the house, including values and behaviors, as well as the organizational structures such as hierarchies and processes.

Values and culture

Values are the ‘unwritten rules’ of how people interact including as shoulds and shouldn't, musts and must not, rights and wrongs, and things which are important and unimportant. 

Values are unwritten in that we all have them and they are reflected in what we actually do, rather than any written set of company values. Writing them down is a good thing only to the degree to which these are communicated and supported by the company hierarchy.

Written sets of values are not new, as evidenced by the Christian Ten Commandments. This overarching ruleset has influence trusting behavior for many centuries.

Values which support trust are those which encourage interdependent working and support of others just because it is the right thing to do. 

Trust may be explicitly mentioned in company values, along with themes such as ‘focus on the customer’ through which people can legitimately request things of one another and trust that they will support activities that are working towards these common goals.

Values which act to reduce trust are often those which emphasize individual excellence and financial goals above any statements of trust. 

Where people are rewarded more for the achievement of individual rather than group goals, this divisive encouragement is likely to lead to non-collaborative and untrustworthy behavior. Discouraging such overt actions are the broader social rules, including what remains of historical social values.

Other cultural factors also may also support or hinder the trust rules that are set up by values.

Interdependence

Where people are interdependent they require things of each other. The dynamic for reciprocity is thus set up by the complex task environment and the limitations of time, skill and control that the individuals possess. 

To do my work I need your help. Fortunately, you are in a similar position so we can engage in mutually satisfying value exchange.

Where dependence is a one-way street, there arise positions of vulnerability and power, where the powerful can take advantage of the vulnerable almost on a whim. Power behavior in organizations often involves delays and ‘not now’ can easily become a technique of deliberate sabotage. 

Even when the powerful are well-intentioned, as most are, pressures of work lead them to prioritize dependent people off the scale, thus leading to unintentional sabotage (which is of little compensation to the dependent person who is losing out).

Role and process clarity

Where people’s jobs are clear, it is easy to determine who is responsible for what, who controls what resources, and consequently where you need to go for dependent actions and whether the person you are depending on is obliged or interested in helping you.

An unclear role leads not only the requestor but also the person being asked to be uncertain as to whether the requested action should be undertaken. Similarly, where processes are unclear or unstated, especially in their boundary points where work touches upon other people, then the uncertainty can make decisions arbitrary and based more upon individual rather than organizational need.

This does not mean that all jobs and processes should be defined down to the nth level. It does, however, mean that for trust to occur, decisions points and criteria must be clear. Factors such as clear values and limited interdependence can simplify such situations.

Where fewer people need to be trusted, the problems of trust are immediately focused although if such designs result in single authorization points, these can easily become bottlenecks rather than open highways.

Goal congruity

Where I have one objective and you have another, my asking you for help is not likely to get a positive response. If, however, we both are working to the same strategic plan which is clearly communicated to us all, we have a point of commonality through which we can work together. 

I can trust that what you do is not likely to be diametrically opposite to my activities and that when you make a promise because we are working on the same thing, you will keep to your word.

Goal congruity is not the same as role and process clarity, although they are closely related. The goal marks the end-point and gives the overall direction, whilst roles and processes are methods of achieving the goal. In situations of uncertainty, goals (like the higher-level values) help us to make agreeable decisions.

Visibility

Where trust is given and it is clearly visible that the person being trusted is acting in a trustworthy way, the feedback enables confidence in that trust to be rapidly increased. Much trust comes through communication. If I ask you to do something and you regularly give me updates of progress along the way, my imagination is

The corollary is also true. Where the actions and results of people’s decisions and behaviors are hidden, and where there are other structural factors that encourage untrustworthy behavior, then the temptation to manipulate others is higher. 

When, however, the actions and their consequences are visible to those who can and will act to punish transgressors, then the untrustworthy behavior is significantly discouraged.

Visibility can be reduced by such as functional barriers, where requests are sent to a department rather than to a named person. 

Similarly, where the ‘process’ or equipment or ‘management’ can be blamed, the true source of untrustworthiness can be concealed. It can (and often is) also be hidden through unwritten social rules, where ‘I won’t question your incompetence if you won’t question mine.’

Consequences of transgression

If I trust you and you fail to meet our agreed actions then what happens? If there is nothing else I can do if there are no consequences for you as a result of this failure, then why should you worry? A system that has no punishment for trust failure

Punishment can take two forms. Formal punish may happen if I go to your manager and complain that you are not acting as you should. The consequences of this can then range from a mild ticking off from your manager to expulsion or even legal action, depending on the severity of the transgression. 

Much punishment, however, is informal and social in nature. Social punishment can include being gossiped about, being ostracized or being verbally abused, any of which can be extremely uncomfortable and professionally damaging.



Economics of Trust

Like quality, trust costs. I can either pay up-front to assure it, or I can cross my fingers and end up paying a potentially much higher price down the line. The greater the distrust, the higher the price in terms of building and assurance, let alone any failure costs.

Cost of developing trust

It takes time to build trust. We may start by researching the other person’s background, perhaps by asking other people or scanning their resume. We can always watch them at work, interacting with other people as well as ourselves. And we can check their actions over time.

Cost of maintaining trust


On an ongoing basis, how do you stay confident that you can trust what they are doing? This often takes the form of formal measurement, reviews, approvals and so on, effectively looking over their shoulder to double-check that they are doing what you want them to do.

When they offer advice or make recommendations, trust assurance may include getting a second opinion or utilizing further evaluation methods.

Each interaction thus has a transaction cost, which includes the cost of getting to the person with whom you will interact, along with the cost of assuring trust. A significant reason why companies exist is to reduce that transaction cost.

If I am a sole trader, I need to first find customers and suppliers and then decide whether I can trust them. It’s a better economic proposition to form a working group where access is faster and trust levels can be build up beforehand, such that in each transaction we can both quickly get down to business.

Cost of trust failure

When trust is broken, work not only may need to be redone but there may be other, far more serious knock-on effects.

A single trust failure can have a knock-on impact other trust relationships, such as when a person you have trusted to do some work for a customer has failed in some way, resulting in the customer’s trust in the whole company and brand being affected.

Trust failure can also lead to retribution and revenge, where the betrayed person seeks compensation beyond that which may be considered as fair.

They have been emotionally hurt and want to exact a penalty that emotionally hurts you in return. If they had given you a high level of trust and feel very strongly about the betrayal, then their actions may be very damaging.

Revenge actions can also cause counter-reactions, where the avenged-upon also feels emotionally wronged and seeks revenge for the revenge. In this way, simmering feuds and outright battles can erupt, with the accompanying fall-out that can suck many others into the fray.


Trust capital

Trust is like a pot of money. When we do something for other people, we put money in the pot. When they do things for us, they take money out of the pot.

The problem is that when we act in an untrustworthy manner, we are fined a huge amount and we can even become bankrupt. And when trust is lost, it requires an even larger investment over a period of time to restore.

Individually, we have trust capital with the people around us, which determines how much they trust us and how quickly they will act to help us when we ask things of them. Companies and groups also have trust capital within them, which is the aggregate trust levels of the people within the company.

There is also an external trust capital, which approximates to the internal levels. This is the brand value of the company, which is the aggregate of the trust placed in the company by all of its external stakeholders, including customers, shareholders, and suppliers.

When I buy a Volvo, I am trusting the Volvo brand that it will be safe. When I shop at Carrefour, I am trusting that their prices will be uniformly low.



Low Trust Responses

There are situations where we cannot avoid being having to work where we have the low or limited trust of the people around us. We will typically act in such an environment to manage the trust.

Hedging

Hedging is placing a bet elsewhere, such that if the current situation fails, you have more than a straw to clutch at. For example, in negotiation, developing a walk-away alternative action allows you to ‘walk the line’, knowing that you have a safety net, should you not reach an agreement.

The problem with hedges is that they are distracting, both in terms of the work required to develop them and also in that they can start to appear even more interesting than the current work. This results in people putting not only putting less effort into the current work, but they may also leave altogether.

Distancing

If I do not trust a person, a simple approach is to minimize my contact with them. By standing back and not getting involved, I minimize the risk of betrayal or other impacts of trust failure.

When a person is distancing themselves from their domain of work, they are not fully engaged and even though they may be occupied in useful work 100% of their time, they are not contributing to their full potential.

Quitting

An extreme form of distancing is to leave the stage. If I feel that the distrust that has built up prevents me from doing my job in a satisfactory way, then I always have the option of leaving.

Leaving can mean finding another job within the company or even leaving the company for other shores. It also is a form of retribution, as the distrusted party is then left without my skills, and their lack trustworthiness may be exposed for all to see (especially if I leave with a few choice words in the right quarter).

Focusing

By clarifying what I do and (often more importantly) what I do not do, I can send an unequivocal signal that pre-empts any criticism of my not doing tasks which are not my job. This also allows me to focus on building my competencies and proofs of competence in the defined area.

Also, if I ‘wear the hat’ of my role in interacting with others, I can hide my vulnerable human persona behind my assertive professional face.

Alliances

If I do not trust you, I may decide to gang up with some other people who also have low trust in you. Such low-trust groups may collaboratively hedge or distance, magnifying the negative effects of these approaches.

I may also seek alliances with people who can add more beneficial elements, such as representing my achievements to you in a more positive light.

Trust-building

A generally more positive approach is to deliberately act to increase trust. If I act in a trusting manner, then you may well feel obliged or motivated to act in a trustworthy manner. I can also act in trustworthy ways, such as always keeping my word, completing tasks on time, maintaining high integrity in conversations, etc.


How to create Trust?

There are various way to create trust, here is the few point worth considering


Active Care: Don't wait to be asked.
Appeal to Trust: Seeking to create truth.
Be Reliable: Deliver on your promises.
Building Rapport: Many ways to create trust.
Evidence: I cannot deny what I see with my own eyes.
Expressing Care: Show concern for them and theirs.
How Can I Get People to Trust Me?: More practical methods.
Passive Care: Do no harm.
Self-Control: Showing self-control helps too.
Similarity: We trust people who are like us or who are similar to people we like.
Teasing: Testing and showing trust.
The Trustee's Choice: If you are the person being trusted.



Building Online Trust

Most of us have interacted online with other people, companies, and websites. In doing so one of the early questions we wonder is whether the other side can be trusted. Whether we do or not has a great deal to do with how the website and interactions are designed for trust.

So how do we trust? First, we trust people who are reliable, including keeping promises on time and being competent so they can deliver on their promises. To design for reliability, it is important to manage expectations, telling people what you will deliver, then always delivering, on time, on a budget, and to specification.

We also need honesty in forming a trust, so we look for truthfulness. This can be a problem when a site is trying to sell us something as we may well suspect exaggeration of good points and concealment of bad points. The site should never knowingly mislead customers, as a betrayed customer gets angry, tells others, and never returns.

The third leg of trust is care. We trust those who seem to care about us, both passively ('do no harm') and the more helpful active care. Care as a component of trust is often forgotten, yet this has huge potential for building trust.

A site can show care with simple, good design that is attractive, lets readers easily find what they need, and provides them with quality information. Offering helpful tips and otherwise giving without asking is likewise likely to make them feel good when they think of you.

And here are a few more things you can do with your site to build trust:
  1. Include photos and full details about your products, as well as easy overviews.
  2. Show photos of your people, smiling and looking good.
  3. Allow reviews and star rating of your products.
  4. Provide multiple ways for readers to contact you, such as email, phone and online chat.
  5. Respond quickly and sympathetically to all communications.
  6. Don't be defensive about criticism. Ask for more information.

Conclusion

Source: Google image


The bottom line is to keep thinking about trust. Everything you do can build or destroy it -- and destruction is very easy, and can have devastating consequences. Figure out what trust you need and act accordingly.

Do not expect blind loyalty -- web users are largely cynical about all the trickery that they see every day. Also, do not 'wing it' with 'that will do' type tweaks. Think hard about trust and design for it, and, if you truly understand it, you will be far more likely to get the powerful trust that you need.

Hope you enjoyed this article, feel free share, comment and express your opinion.


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