Dr. Jerry Osteryoung Executive Director of the Jim Moran Institute for  Global Entrepreneurship at Florida State University

Do Not Violate Trust!

You may be deceived if you trust too much, but you will live in torment if you don't trust enough.  ~ Frank Crane

I have been at Florida State University for 34 years, and I really love this university.  Before I came to FSU, however, I taught for two years at another university.  I left that position because the dean promised me research support and a higher salary, neither of which ever materialized.  When I approached him about these two items, he said that it was his sole prerogative to make or break promises.

{sidebar id=1}After this discussion, I felt that there had been a complete breach of trust.  My wife and I left the university and came to FSU, leaving our house unsold.  It was worth it to me to pay almost any cost to get out from underneath a boss that I could no longer trust.

Employees need to be able to trust you, or your credibility goes out the window.  A firm that we were trying to help had some cash flow problems, so they unilaterally cut the sales staff salaries and commissions in order to balance the budget.  You guessed it:  they lost every single sales person as they no longer trusted management.

Sure, this firm had some serious financial issues, but they should have gone to their employees and gotten some feedback before they cut salaries.  Lowering employees’ salaries is a sure way to lose the trust of your staff and send them looking for new jobs.

Another entrepreneur decided she needed to improve profitability and, without notice, eliminated the coffee and coffee makers that she had been providing for over five years.  Obviously, the staff felt as if they were blindsided, and the morale of the organization plummeted as trust was destroyed.
In yet another case, an entrepreneur wanted to improve the profitability of his business, and he told his staff that he would distribute 10% of the increase in net profits among the staff.  The staff really liked this idea and worked much harder to make this happen.  The employees knew that profits were increasing, yet they never received a cent or an explanation as to why.  In fact, the entrepreneur never even mentioned the arrangement again.  Obviously, morale declined, and employee turnover increased dramatically.

I like to say that leaders have a “trust bank” with each employee.  Funds are added to the bank when the leader demonstrates trustworthiness, either through actions perceived or actions viewed by the employee.  Funds are deducted, however, when trust is breached in some fashion.  For example, if the employee feels that a leader is not being consistent, funds are withdrawn.

Leaders and managers can only be effective if employees feel as though there is a positive balance of trust in the bank.  If the bank hits zero or drops into the negative, the employee will simply be unable and unwilling to trust the manager.  The employee will either begin seeking other jobs, or they will just reduce their work output to the absolute minimum.

Trust is such an important part of the leadership of any business.  You must make sure that your staff trusts you both now and in the future to ensure that your “trust bank” stays full.

You can do this!

Jerry Osteryoung is the Jim Moran Professor of Entrepreneurship in the College of Business at Florida State University.  He is also the Director of the Entrepreneurship Program at FSU and Executive Director of the Jim Moran Institute of Global Entrepreneurship.  He can be reached by e-mail at jostery@comcast.net or by phone at 850-644-3372.  Please visit the JMI website to view past articles in searchable format or through the archives.

This article originally published on February 25, 2008.

Written by :

mkwestmark

 

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