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Thursday, 01 November 2012 13:20

Rethinking Trust

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Rethinking Trust

Key ideas from the Harvard Business Review article by Roderick M. Kramer

The Idea in Brief

Trust is essential for business and economic success. But recent financial scandals suggest that people aren’t always very smart about whom they trust. Bernard Madoff took in some of the world’s cleverest people.

In evolution, trust served humans well because it increased the chances that vulnerable infants would survive. Our body chemistry rewards us for trusting, and we quickly decide to trust others on the basis of simple surface cues such as their physical similarity to us.

Our readiness to trust makes us likely to make mistakes. At a species level, that doesn’t matter so long as more people are trustworthy than not. At the individual level, though, misplaced trust can get us into trouble. To survive as individuals, we’ll have to learn to temper our trust.

Trust is essential for business and economic success. But recent financial scandals suggest that people aren’t always very smart about whom they trust. Bernard Madoff took in some of the world’s cleverest people.

The Idea in Practice

To trust wisely, we need to readjust our mind-set and behavioral habits, following seven basic rules.

  • Rule 1: Know yourself.

    If you tend to trust the wrong people, you must work on interpreting the cues you receive. If you’re good at recognizing cues but have difficulty forging trusting relationships, then you’ll have to expand your repertoire of trust-building behaviors.

    • Rule 2: Start small.

      Measured trust begins with small acts that foster reciprocity. A good example of the dynamic was displayed by Hewlett-Packard in the early 1980s. Management allowed engineers to take equipment home whenever they needed to, without having to go through a lot of red tape. That sent a strong signal that the company trusted employees, yet it involved relatively little risk, because the policy was tied to employees’ not abusing the trust.

      • Rule 3: Write an escape clause.

        With a clearly articulated plan for disengagement, people can trust more fully and with more commitment. In Hollywood, scriptwriters register their pitches with the Writers Guild—a simple act that hedges against the risk that others will claim a story as their own.

        • Rule 4: Send strong signals.

          Most of us mistakenly believe our trustworthiness is obvious. We actually need to signal it more clearly. By the same token, we have to retaliate strongly when our trust is abused. Sending weak signals about our willingness to engage in trust or punish abuse of it makes us more vulnerable to exploitation.

          What would you like to see in the next decade?

          • Rule 5: Recognize the other person’s dilemma.

            Because we worry so much about protecting ourselves, we often forget that the people we’re dealing with confront their own trust dilemmas and need reassurance about whether (or how much) they should trust us. Good relationship builders are proactive at decreasing the anxiety and allaying the concerns of others.

            • Rule 6: Look at roles as well as people.

              A person’s role or position can provide a guarantee of his expertise and motivation. But be careful; people on Main Street USA trusted people on Wall Street for a long time because the financial system seemed to be producing reliable results that were the envy of the world.

              • Rule 7: Remain vigilant, and always question.

                Many people whose trust is abused do conduct their due diligence initially. The trouble is that they don’t keep the due diligence up to date, because they find that being vigilant and ambivalent about the people they trust is psychologically uncomfortable.

                About the Author

                Roderick M. Kramer is a social psychologist and the William R. Kimball Professor of Organizational Behavior at the Stanford Graduate School of Business in Palo Alto, California. His most recent books are Organizational Trust (Oxford University Press, 2006) and, with Karen Cook, Trust and Distrust in Organizations (Russell Sage Foundation, 2004).

                Read 2021 times Last modified on Thursday, 01 November 2012 13:29
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