Since the Great Recession of the late 2000s and early 2010s, trust in leaders and institutions has been consistently eroding or remaining stagnant. In the business world, trust in top management is vital for ensuring that employees internalize the strategies and goals of the entire company. A lack of trust can challenge the efforts of CEOs, top management teams and their Boards of Directors when they are trying to gain broad, sometimes, global followership for growth or transformation plans.
The Typical Approach – Trickle Down
In an effort to build trust and influence the company, CEOs and their teams will often focus their efforts on broadcasting ‘trusting’ messages directly through wider corporate communications channels (e.g., ‘Our people are our greatest asset’ or ‘We have created a new product to increase business.’) They will also scrutinize their own leadership teams for appropriate management attitudes and behavior (‘We have a new vision statement and leadership model.’) The expectation here is that these leaders will then communicate similar messages and role model wanted behaviors within their organizations. Broadcast communications, supplemented with role-modelled or prescribed behavior will then influence the wider organization and build trust and support.
This has been the traditional, ‘trickle-down’ or ‘cascading’ approach. Building trust in organizations or plans becomes delegated just like tasks and objectives. While this trickle-down or cascading approach has its merits, new research indicates grounds for another, possible even more effective, approach to add to the arsenal of senior leaders.
Another Viewpoint – Trickle Up
A recent study published in the Journal of Applied Psychology shows that employee trust in their direct manager exerts upward influence on employee perceptions of trust in their top leader. Trust is transferred from an employee’s direct manager to the top-level leader. So, the extent to which one trusts their direct manager directly impacts the extent to which they trust the CEO and the top leadership team. Trust in the top is ‘trickled up and transferred’ from manager behavior experienced below.
When it comes to performance, research published by the British Psychological Society has shown that trust in senior leadership is even more important in influencing a lower-level work team’s performance than trust in that work team’s direct manager.
So, behavior of a manager four or five levels down, and maybe thousands of miles away, from the CEO impacts the trust the employee has in the top leadership team. If there is not enough trust in this particular manager then there is little trust which can be trickled up and transferred. The lack of this kind of trust may impact company performance because trickled up and transferred trust has a more significant impact on the employee’s performance than trust in their own supervisor.
For example, let’s say a company’s top leadership team messages that they value employees and asks everyone to trust in their judgment and support a new strategy which will increase growth and profits. Four levels down a lack of clarity around how to get promoted and broken promises of pay increases or extra resource support makes an individual wonder if they can truly trust their direct manager. These two situations can combine to produce little faith in the senior team’s new vision and strategy.
But, wait. You are talking about different things.
Yes and no. Trust is multi-dimensional and multi-faceted. The individual employee in this case is experiencing that the systems impacting their immediate working life (performance appraisal, salary increase and resource allocation) are not fair. This perception of a lack of fairness in either the procedures which govern them or promises their manager is making will lead to distrust in their manager. Psychologists call this procedural justice. It’s well documented and very important. The new research has shown that if there is little trust in their own manager, particularly from fairness of processes and procedures, then there isn’t much to trickle up and transfer towards the top leadership. Situations like this are not uncommon and have led to many a discussion in leadership team meetings about how to create a high performing company culture.
But wait, we conduct regular employee opinion surveys.
Typical organization engagement surveys tend to ask directly about trust in top management or employees’ trust in the company as a whole. This straightforward approach may actually obfuscate the issue. The actual situation is complex because employees develop and maintain multiple trust relationships. These interact and influence each other. A typical employee spends more time with their line manager and see them as representing the company. From an individual employee’s point of view, if they don’t trust their manager on the simple things then how can they trust their boss’s-boss’s-boss’s-boss on the bigger, more complicated things?
Therefore, CEOs and their teams need to be spending more time and effort directly engaging their ‘skip-level’ and ‘front-line’ leaders and the teams they lead. Relying on trickle down or cascading approaches alone won’t be as effective as building trust through direct engagement. Building trust is something that shouldn’t be assumed or delegated.
But ‘trickle down and cascade’ is how we’ve always done it
Which is why employee trust in top management is still a conundrum for many CEOs and their leadership teams. There is also a new expectation that CEOs build trust, even ahead of producing high-quality products and services. Luckily new research is available to help us better understand human psychology and thereby enable you to be even more effective. You are undoubtedly working hard and have good intentions. The question to ask yourself is, ‘are we working smart and getting maximum value for our efforts?’
Your time is valuable and limited. Where should you focus attention?
Here are three practical considerations:
- Focus more effort on ‘skip-level’ leaders, ‘first-line’ managers and their teams. Don’t just rely on the cascading of messages by your team or trickle down influence or role-modeling of attitudes or behaviors. Don’t delegate it to the Human Resources Department or an external consultant to solve. Remember, trust is multi-dimensional and multi-faceted. Ask yourself the following questions:
- How can you personally engage your line leaders more effectively? How do they know your expectations? Who is teaching your front-line leaders?
- Can you spend more time with them? How can you better use video and collaboration technology?
- What is being taught to these leaders? It’s ok to delegate the execution of this, but, you need to make sure that you have a say on what is being taught.
- Hold the highest standards for fairness and clarity in your company’s procedures, systems and treatment for all employees. Don’t underestimate the impact that perceptions of your company’s performance management, budgeting, promotion and grievance systems will have on whether your employees will believe in your new growth or product strategies. Are the procedures used by your front-line managers perceived as fair? Do your managers show that they value, trust and respect their teams? These employee perceptions are important and trust in both the systems and their direct leaders trickles up and transfers to you (or not.)
- Eliminate 1990s style of communication. Ensure your own communications to the company are authentic and ‘two-way.’ The top-down, broadcast-mode, paternalistic methods of the last century finally need to be retired. Your communication needs to be authentic, ‘two-way’ conversations with a focus on engagement. Don’t underestimate the importance of social media. Here is a useful guide if you aren’t fully comfortable with why it is important or how to make use of it for your business.
Research in the behavioral sciences is showing how trust in one part of a system can specifically interact with trust in another part of the system. Specifically, an employee’s trust in you as CEO or senior leader is trickled up and transferred from the amount of trust they have in their direct manager and in the processes and systems they interact with regularly. Therefore, making sure you know what is happening at the front line, ensuring fairness in all aspects of your employees’ work experience and communicating and engaging in a way fit for the times will enable you to develop more trust in your company.
Robert Kovach is the Director of Leader Success for Cisco’s Leadership and Team Intelligence Practice Area. He has been an advisor to leadership teams of Fortune 500, FTSE 100 and FTSE Global 500 companies on driving business strategy through executive leadership effectiveness and organizational agility. The opinions expressed in this blog are his own and not those of Cisco. Contact him for speaking enquiries.