trust mba(fyic)

Trust: The Foundation of

Leadership

Trust or lack of trust is an increasingly important leadership issue in today’s organization.

What is Trust?

Trust:

A positive expectation that another will not—through words, actions, or decisions—act opportunistically.

Trust is a history-dependent process (familiarity) based on relevant but limited samples of experience (risk).

→ Positive expectation assumes knowledge and familiarity about the other party.

→ Opportunistically refers to the inherent risk and vulnerability in any trusting relationship.

DIMENSIONS OF TRUST

Dimensions of TrustIntegrity:It refers to honesty and truthfulness. Of all the dimensions, this one seems to be most critical when someone assesses another's trustworthiness. For instance:

Follow policy of company, Respect co-workers, exhibit responsible behavior etc.

Competence:It encompasses an individual’s technical and interpersonal knowledge and skills. Does the person know what she/he is talking about?

For Instance:

Listening Understands and learns from what others say.

Reading Comprehension

Grasps the meaning of information written in English, and applies it to work situations.

Speaking Conveys ideas and facts orally using language the audience will best understand.

Writing Conveys ideas and facts in writing using language the reader will best understand.

CONSISTENCY:It relates to an individual’s reliability, predictability and good judgment in handling situations.” Inconsistency between words and action decrease trust”.For instance:This dimension is particularly relevant for managers.

“Nothing is noticed more quickly….. Than a discrepancy between what executives preach and what they expect their associates to practice….”

LOYALITY:It is the willingness to protect and save face for another person. Trust requires that you can depend on someone not to act opportunistically.

OPENNESS:The final dimension of trust is openness. Can you rely on person to give you the full truth?

LeadershipLeadership

TRUST AND LEADERSHIP

TRUSTand

INTEGRITY

TRUSTand

INTEGRITY

Trust is primary attribute associated with leadership and when this trust is broken, it can have serious adverse effects on a group’s performance. Honesty and Integrity are among the most important traits associated with leadership. Mr. Don Carry have rightly said that” you can’t lead people who don’t trust you “.

When followers trust a leader, they are willing to be vulnerable to the leader’s actions- confident that their rights and interest will not violated. People are unlikely to look up to or follow someone whom they perceive as dishonest or who likely to take advantage of them.

TYPES OF TRUST.Trust

Deterrence-based Trust

Knowledge-based

Trust

Identification-based

Trust

DETERRENCE-BASED TRUST :One violation or inconsistency can destroy the relationship. This form of trust is based on fear of reprisal( if the trust is violated). Individuals who are in this type of relationship do what they say because they fear the consequences of not following

Through on their obligation. Deterrence-based trust will work only to the degree that punishment is possible, consequences are clear and the punishment is actually imposed if the trust is violated. Most of the new relationship begins on a base of deterrence. For instance:

A situation in which you are selling your car to a friend of a friend. You don’t know the buyer. You might be motivated to refrain from telling this buyer all the problems of your car that you know about. Such behavior would increase your chances of selling your car. But you might lose a opportunity to maintain a good relationship with the person for any future dealings.

KNOWLEDGE-BASED TRUST:Most organizational relationship are rooted in knowledge based trust. That is, trust is based on the behavioral predictability that comes from a history of interaction. It exits when you have adequate information about someone to understand them well enough to

Be able to predict their behavior accurately. Knowledge-based trust relies on information rather than deterrence. Knowledge of other party and predictability of his or her behavior replaces contract, penalities and legal arrangements more typical to deterrence-based trust. In this knowledge based level, trust is not unnecessarily broken by inconsistent behavior.

IDENTIFICATION-BASED TRUST:The highest level of trust is achieved when there is an emotional connection between the parties. It allows one party to act as an agent for other and substitute for that person in interpersonal transactions. Trust exits because the parties understand each other’s intentions and

Appreciate the other’s want, need and desire. The best example of identification-based trust is a long term, happily married couple. A husband comes to learn what’s important to his wife and anticipates those actions. Wife in turn trust that he will anticipate what’s important for her without having to ask her. Increased identification enables each to think like the other, feel like other and respond like other

BASIC PRINCIPLES OF TRUST:≈ Mistrust drives out trust.≈ Trust increase cohesion.≈ Mistrusting groups self destructive.≈ Mistrusting generally reduces productivity.≈ Trust can be regained.

MISTRUST DRIVES OUT TRUST:People who are trusting demonstrate their trust by increasing their openness to others, disclosing relevant information and expressing their true intentions.

TRUST INCREASE COHESION:Trust holds people together. Trust means people have confidence that they can rely on each other. If person need help and other person knows that the others will be there to fill in. group members who display trust in each other will work together and achieve group goal.

MISTRUSTING GROUPS SELF DESTRUCT:The corollary to the pervious principle is that when group member mistrust each other, they repel and separate. They pursue there own interest rather than the groups. Members of mistrusting tends to be suspicious

MISTRUSTING GENERALLY REDUCES PRODUCTIVITY:Mistrust always reduces productivity. Mistrust focuses attention on the differences in member interests, making it difficult for people to visualize common goals. People respond concealing behavior and peruse their own interest

CONCLUSION

Build trust by→ Sharing information→ Encouraging open communication→ Sticking to their ideals