The Single Thing You Need to Be a Better Leader

You can improve your entire organization with one thing. Trust.

You build it by demonstrating concern for, and commitment to, the well-being of your employees and your customers.

Leaders like Tony Hsieh of Zappos do this consistently, which is why the company he founded is ranked near the top of the list of Fortune’s “100 Best Companies to Work For.”

Not only does Zappos provide employees with free lunches and all-you-can-eat vending machine fare, but Hsieh asks for and values employee ideas.

He rewards hard work, loyalty, and risk-taking. And he’s not afraid to take the blame when something goes wrong, shielding those who work for him.

Take the 2010 online pricing disaster, for example.

Due to a technical glitch, all the shoes at sister website 6pm.com were priced at $49.99 for a number of hours. During that time, customers snapped up unbelievable bargains, given that some of the site’s shoes sell for as much as $1,000.

When the problem was discovered, Hsieh took to social media to alert customers to the error and to apologize for any inconvenience when the prices were reset at their correct values. Then he proceeded to honor all of the orders that had been taken, suffering a $1.6 million loss in the process.

More importantly, he showed his customers and his employees that he is a man of his word. That he is trust-worthy.

That is the key in your company, too. You earn trust by doing what you promise and living up to your own standards. It’s that simple.


Trust=Higher ROI

The level of trust that exists within your organization affects everything. From the CEO’s office to the loading dock, every performance and every outcome is dictated by trust.

There’s a direct correlation between trust and performance. According to a Watson Wyatt study, “Three-year total returns to shareholders (TRS) rates are significantly higher at companies with high trust levels, clear linkages between jobs and objectives, and employees who believe the company manages change well.”

Conversely, low trust levels lead to second-guessing on every communication, transaction, strategy and decision. With that, the cost of doing business and the time it takes to get things done escalate.


Building Trust

Trust is earned over time through consistency of thought, word, and deed. By living up to your stated commitments, taking action where action is needed, you earn the respect and trust of those around you.

In a business, trust is also built through positive results.

By achieving set objectives – from reaching sales goals, to improving satisfaction ratings, or reducing employee turnover – you prove your abilities as a leader. And, in truth, anyone can be a leader.

Titles like owner, manager, or director do not make leaders. Action does.


Measuring Trust

Although it seems intangible, trust can actually be measured across six factors.

How well do you score on these?

• Follow-through: Do you and your staff live up to commitments made? Do you do what you say you will do within an agreed-upon time frame? Failing to follow promises with action damages trust.

• Share information freely: Do you keep your team informed and up-to-date? People who withhold information are deemed untrustworthy.

• Predictable behavior: Is your behavior consistent and encouraging? Aggressive or inconsistent behavior erases trust quickly.

• Feedback: Do you provide regular and fair performance feedback? When employees know how they are doing and see managers invested in their success, trust soars. And when feedback is lacking, even if positive, employees question their role and relative importance.

• Gossip: Do you share information broadly in order to help your team succeed? Or do you engage in behind-the-scenes conversations about individual employees? When the grapevine and gossip are your leading communication vehicles, trust cannot grow.

• Open door policy: Do you encourage employees to come to you with problems? Allowing workers to ask for guidance and feedback without negative repercussions builds gratitude, loyalty, and trust.


Return the Favor

Effective leaders don’t simply inspire trust; they trust their employees as well.

Your staff is very tuned in to the trust you place in them. A feeling of trust enhances performance and increases the sense of responsibility and buy-in to the end result.

The more you trust them, the more they’ll trust you, and you’ll be creating a high-trust organization… the type that enjoys high morale, high performance and incredible results.

Do you think trust is the most important quality for a leader?

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