Building Trust is Key to Last Long in Business
You cannot last long in this world without trust. It creates friendships, keeps partners by your side and grows your businesses.
Trust inspires loyalty, and it extends to organizations as well as people. Venerable brands such as Coca-Cola and Nike understand their committed fans would disappear quickly if they believed that trust was being abused. No marriage and no company can survive if the people who depend on them always are worried that the other party won’t deliver on promises.
Not only trust is the foundation of all relationships, it is what determines how long it will last. Your business survives only by keeping trust. It determines whether your company will last for five years or endure for five decades.
You can also always see interplay between ethics and trust. Fortunes have been and are being lost when companies lose the trust of customers, stockholders, investors and regulators.
The breakdown of corporate trust begins with the abandonment of corporate ethics. Ethics are defined by corporate leaders and maintained by corporate culture, which also is defined by corporate leaders. The two halves of the equation — defining and maintaining — are essential. Both are the responsibility of top management.
Consider these two sides of the ethics coin:
- An organization that does not define its corporate ethics has none. No amount of oversight will prevent some employees from taking shortcuts to achieve their personal goals or spoofing their Management By Objective targets. You’ll see this at work whenever sales people, striving to meet quotas but not hobbled by ethics, take every shortcut to make a sale.
- Likewise, well-defined ethics are useless unless there are means for enforcing them. A top-down, data-driven monitoring and inspection process is as impractical as it is expensive and organizationally disruptive. In this respect, corporate culture plays two important roles. It is both the communicator of ethics and a peer-enforcement mechanism.
Ethically loose companies mostly have a short life span. Consider these examples of loose ethics:
Lying to customers to land sales and generate the sort of top-line revenues that venture capitalists like.
Shortchanging customers on support.
Making irrational financial projections to garner more investor cash.
Abandoning employee wants and needs.
The list of ethical lapses is functionally endless. But there are also many companies with no such lapses. They defined their cultural basics, encoded them in ways that can be easily understood and shared (think the HP Way and Google’s Ten Things) and used both peer-level and boss-staff enforcement of ethical rules. They set these rules of engagement and made them stick. They act according to the ethical principles by which their people consistently abide. These actions, in turn, lead people to trust them. And it’s no coincidence their companies are thriving.
Trust is created through faithful execution of ethical rules. Without this, you might last a few years. With it, your company can outlast you (and possibly your grandchildren).
Source: Entrepreneur India