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The #1 Issue for Companies Emerging from the Recession:
Rebuilding Trust
By Suzanne Bates
As CEOs lead their companies out of recession they have a myriad of issues on their plates, but none is more important than that of rebuilding trust. While the executive team and board may be focused on strengthening the balance sheet, a lurking issue that will make or break many companies is the integrity of the company and the level of trust between the company and its customers, clients and employees.
In Bates Communications latest survey of 148 business professionals, the No. 1 issue in emerging from the downturn is executives’ ability to rebuild trust with employees, clients, and customers. Data shows that the recession has caused significant damage to business relationships, which must be repaired in order for companies to move forward and take advantage of the opportunities of a new economy.
SYNOPSIS
Employee Trust:
Perhaps not surprisingly, employees remain apprehensive about their jobs and anxious about the future, in spite of signs of a recovery. This means it will be more challenging for some companies to attract and retain top talent.
Customer Trust:
In addition, client and customers are still apprehensive about buying decisions; taking a hard look at how the companies with whom they have done business in the past are treating them today. They are concerned not only about quality, delivery, customer service and cost, but also the integrity of the organizations with whom they do business.
Survey Details:
PIt can’t be emphasized enough that trust surpassed every other issue facing companies and executives right now. 76% of respondents rank building trust among employees and customers as the highest priority for future growth and success. Furthermore, trustworthiness ranks second as the quality executives will need most to guide their companies post-recession, selected by 60% of survey respondents – behind only being visionary, which was chosen by 64%.
This means that the CEO and senior team have a major task right now; that is, getting to a deeper level in their relationships, understanding where there are gaps, and communicating to rebuild trust from the bottom up.
In reviewing the data it is clear that:
- Decision makers in every organization need to be more effective in communicating with employees; beyond reassurance about job status or the company’s financial situation, leaders need to be very effective in communicating strategy. They need to involve and empower employees to take action that creates momentum.
- Top executives and their teams also need to recognize the essential role they play in rebuilding trust with clients and customers. They need to “own” the trust issue and acknowledge that whether or not they have contracts with customers, that these customers will take a second look at everything. While some customer relationships may remain strong, others are up for grabs, either as a direct result of a negative interaction with the company, or because of a loss of faith or trust in the industry.
Trust as a Factor in Emerging from the Recession:
Rebuilding trust isn’t just a defensive position; our survey made it clear that CEOs can actually create momentum and gain competitive advantage by addressing the issue of trust. At the same time, companies that ignore this issue and believe business will simply “go back to normal” will miss an opportunity to create the company they want to design for the future.
Trust as a Factor in Attracting and Retaining Top Talent:
Trust will be a major factor among top talent – as they decide where they want to build their careers. Studies show that top talent are already moving around and getting better jobs even as hiring lags. Many high potential employees see this downturn as an opportunity to cast their fortunes with the best, most reputable companies in the marketplace. Reorganization is making it possible for them to advance to bigger roles in new organizations. They see the integrity of the company, the “trust factor” as having equal weight to many conditions, including pay and bonuses.
Prior to the recession, our research already showed that employees need and want to hear more from their CEO. Often, we would hear that leaders aren’t available, accessible, or articulate in describing a powerful vision and strategy for the organization. It’s obvious that now more than ever, CEOs need to engage their teams and win their trust. This means developing communication skills and taking part in activities that help connect the leader to every important audience.
Trust as an Integral Part of Talent Development:
In executive development, trust has always been identified as important in leadership effectiveness, and been a factor in promotions and successful transitions to top jobs. However, as a result of the downturn, trust has been eroded to the point that Human Resources teams need to acknowledge and build it into training and development. It is clear that trust as a leadership skill is an issue that cannot be ignored. It needs to become a focus of executive development, coaching and mentoring.
In addition, top executives must take charge of the trust issue, and not rely solely on the human resources, sales or marketing to address it. The 2008-2009 recession has made it abundantly clear that accountability for the company’s reputation cannot be delegated. CEOs, C-level executives and their direct reports must own the trust issue - delegating this “task” to the next level down simply is not an option.
Additional Resources:
Other surveys have corroborated our findings. For example, according to the 2009 Midyear Edelman Trust Barometer, trust in business has stabilized, compared to their January 2009 report which revealed a devastating loss in trust in the private sector. In Edelman’s survey, when asked what companies could do to rebuild trust in the long run, survey respondents listed “treating employees well” number one with 94% of respondents. Not far behind was “communicating frequently and honestly” at 91%. (Click here to see Edelman’s full report: http://www.edelman.com/trust/midyear/docs/Trust_Midyear_Release_FINAL.pdf)
There is good news; trust is no longer still eroding—it has stabilized. But stabilizing does not put a company into recovery mode. A disturbing trend now is that many CEOs and senior executives have been so busy reorganizing the company and keeping it on a solid financial footing that they are communicating less, not more. Responses show they desperately need to communicate more effectively about the plan and provide guidance to employees, as well as customers, about what’s happening. CEOs who don’t jump in and guide the emotional state of their companies and build strong relationships will fail to keep and attract top talent and their best customers.
What can top executives do to begin the process of rebuilding trust among employees, customers, and other stakeholders?
- Make trust a central focus of your values, not only in branding and marketing but also in your communication with the organization; identify trust and integrity as one of the key values and walk the talk every day;
- Assess the trust gap with clients and customers, get out and talk with them one on one, conduct surveys, analyze issues related to your organization, as well as the industry as a whole;
- Sit down with key employees and talk with them about their views about where the company is headed; conduct an employee survey to assess engagement and also identify areas where you can build trust;
- Significantly increase communications in general through traditional and non traditional means so that you reach all employees, clients and customers;
- Develop excellent programs and make sure that executives are well prepared to speak effectively at town hall meetings, brown bag lunches, employee events, customer meetings, conferences speeches and media, as well as through innovative electronic communication such as email, blogs, video, media and social networking;
- Assess gaps in trust between individual leaders in your organization and their teams and make it a point to get issues on the table and address them in a timely way;
- Discuss trust as part of professional development, provide assessments, coaching and training for leaders and emerging leaders to help them improve communication and address trust issues.
Suzanne Bates can be reached at info@bates-communications.com. The full Bates Communications’ survey on the qualities CEOs and executives need during and after economic recovery will be available shortly. Register for The Power Speaker Blog (www.thepowerspeakerblog.com) or follow Suzanne Bates on Twitter (http://twitter.com/ceocoachbates) for more information when the full survey is released!
Other articles for this month include
Media Exposure for Economic Recovery: Steps for Getting Good Press in Trying Times
After the “Re-Org”: 5 Steps for Maintaining Performance, Even When Everything’s Changed
How to “Unearth” Ideas, Issues, and Solutions: Become an “Exploratory Listener”
The #1 Issue for Companies Emerging from the Recession: Rebuilding Trust
Read and subscribe to Suzanne Bates’ blog, for her latest tips on how to become a powerful speaker and communicator!
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Matt Davis,
Corp. Director of Executive Communications,
Dow Chemical Co.
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