Organizational Trust : What It Means & Why It Matters

organizational trust what it means why it matters

Organizational Trust: What it Means & Why It Matters

Organizational trust, like personal trust, is based on a person’s experience with repeated patterns of behavior.

This concept, coupled with concerns (and in many cases, unfounded fears) about legal compliance in the workplace, has led to a prevailing belief among many HR practitioners and line managers that you must treat all employees the same. This is observed in many organizations where HR assumes the role of lawmaker and enforcer and they coach management in the fundamentals of being “traffic cops”.

Organizational Trust

To protect their organization, the rules are in place. Newly observed behaviors by workers result in new rules. A look at posts on HR message boards tells the tale:

“People are stealing lunches out of the refrigerator in the break room…”

“I have an employee who is not eligible for FMLA (Family Medical Leave Act which provides “protected”  leave) who will be out of work for a month for a medical condition and we have an attendance policy that only allow 6 days per year of absence…”

And the sage responses follow an all too familiar pattern:

For stolen lunches: “Do you have a policy in place for your break room? Follow your policy”

For the infirmed employee: “Follow your attendance policy. You don’t want to establish precedence”.

The theme resonates with consistency:

Follow the policy

  • Don’t establish precedence
  • Treat all employees the same

The concept of managerial judgment is a dangerous and slippery slope.

Let me give an example of how this plays out.

Jane had been with her company for ten months. She was a quick study and immediately began producing some pretty impressive results. She was a dedicated worker and was respected and liked by her peers and management.

In the course of a medical exam, a cancerous tumor was discovered and she had to undergo surgery to excise the tumor. Though her doctor prescribed a ten day period for recovery, she returned to work after three days.

A month later she began to have severe reactions to the chemo treatment that had been prescribed. Her doctor changed her medical regimen and prescribed a week of bed rest with minimal activity. She followed the advice for three days but returned to work as she was engaged in a time sensitive project. She suffered through the commute and long days and gradually overcame the symptoms of her medication.

But her leave was not without consequences. Her manager met with her to address her attendance. The following points were raised:

  • Your name has appeared on out attendance (problem) report
  • We have a policy of no more than six days of absence in a twelve month period. Any further absences can result in your termination as you have not yet met the requirements for FMLA.

Her manager closed the discussion by ensuring her that her work was high quality, she was a valuable employee and that he hoped that she could handle the attendance issue as he really enjoyed having her on his team.

The turnaround was immediate. Jane showed up for work every day even when she was suffering from the side effects of her medications. She was even complimented by her management for “being tough” and “hanging in there”.

But her change had other outcomes. She no longer put in the extra hours and the quality of her work diminished to “good enough”. She met her objectives and timelines, but her work became very average – “meets expectations”.

On her year anniversary she met the requirements for FMLA and the protections that the “law” entitled her. She chose another course: she quit. Her exit interview was simple: “I took a job at less pay to work for a company that is family friendly”.

organizational trust

Not an Uncommon Story

The example is not an exaggeration nor is it uncommon.

The company, represented by her manager and HR, followed all due diligence. They treated her the same as any other employee who had accrued six absences in a twelve month period. They did not go down the slippery slope of using managerial judgment and could not be accused by poorly performing employees of showing favoritism. They were “safe”.

But her resignation, though dismissed by management as “she couldn’t cut it”, left many adverse consequences.  Her projects were left incomplete. Other employees (who already had full plates) were “delegated” her work until a suitable replacement could be found.  And morale on her team plummeted resulting in additional turnover.

Management had done nothing more (or less) than “follow the policy”. To do anything different would be precedent setting and put the company on a slippery slope.

Was there another course of action that management could have taken and met the interests of the company (compliance) and the interests of the employee?

My prescription is somewhat simple, yet challenging.

Conduct your due diligence and ensure that you are following legal requirements – a safe and ethical work environment that is free of unlawful discrimination and provides employees, at a minimum, the rights they are entitled to by law or agreement and apply the basic rule:

Build a “Trusting” Organization Based on Doing the Right Thing

To recap: Trust is built on employees experience with repeated patterns of behavior. Therefore, consistently do the right thing and expect the same of your employees.

Some examples:

I worked for an organization that put their employee handbook on a single postcard: “OUR ONE RULE: Use Good judgment in all situations. Please feel free to ask your department manager, store manager or Human Resource office any question at any time.”

Nordstrom enjoys not only consumer recognition as being an example of exemplary customer service, but has achieved status on Fortune magazine “100 Best Places to Work” every year that the list has been published.

At REI, the “right thing” is demonstrated in the values that the co-op “lives” by. Core values are consistently demonstrated in how REI does business, engages with customers and treats each other.  For prospective employees, REI’s values are prominently displayed on their job board:

During my time at REI, I did not have doubts about what was required for me to be successful nor did I have to guess what I should expect in terms of treatment. The values are way of working – of living within the culture – a culture of deep trust.

REI also enjoys a place in the “100 Best” hall of fame. As an HR professional at REI the charge is simple: maintain REI’s status as a great place to work by ensuring that customers, employees and the environment are treated with great care and respect.

At NLYCare Health Plans, I had the opportunity to work with an extraordinary management team “building” a new company.  We went from a small Preferred Provider Organization in Dallas of about 35 employees to a full-line health insurer of several hundred employees in Washington, Oregon and Texas in a period of about three years.  During that period of growth, we were in a very tight labor market with the industry competing for talent. I will simplify the strategy by borrowing a line from Field of Dreams: if we build it, they will come.

We set about creating a workplace that was respectful and inclusive and one that was fueled by meaningful work and accomplishment of our business goals. People thrived by being treated consistently with respect for their individualism and opportunities to succeed. Our management guideline was manage yourself and lead your team – walk the talk.

In each of these organizations, the focus was on consistency in treating people with respect and upholding individual dignity. They drew on the strengths of people as opposed to a focus on deficiencies.  Managerial judgment was used in making business decisions, including decisions that impact individual employees.

The “sameness” of treatment was not about micromanaging a book of rules and policies – rather about consistency in applying a set of values that motivate employees to be their best and accomplish their best work.

In these environments, HR and management did not operate in a world of fear from non-compliance. They operated creatively in a world of balancing business need and individual needs. By and large, if a mistake was to be made – it was in favor of the employee and the customer. Compliance to employment laws was a natural way that they daily conducted business.

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