Masterclass: Rebuilding Trust

Professor Veronica Hope Hailey, University of Bath

#NHSE2013 Follow us @nhsemployers

Professor Veronica Hope HaileyDean

School of ManagementUniversity of Bath.

vhh20@management.bath.ac.uk

Trust Workshop2013

The School of Management• One of the UK’s oldest business schools• EQUIS and AMBA accredited1st for Student Satisfaction in Business Studies1st for Student Satisfaction as a University1st for Accounting and FinanceTop University Campus -The Economist Ranking 2013 – FT MBA – 2nd in the UK after LBSResearch – 5th along with Oxford/LSE

OLD DUTCH SAYING

“Trust comes on foot but leaves on horseback”

So – what to do?

ExternalContext

2012

ChangeTrust

Definitions of Trust?

• A psychological state comprising the intention to accept vulnerabilitybased upon positive expectations of the intentions or behaviour of another” (Rousseau, et al., 1998: 395)

• “An individual's expectation that some organized system will act with predictability and goodwill" (Maguire and Phillips 2008).

Benefits of trust (Dietz, 2011)

Trust levels at work

Employee Engagement (extra effort, job satisfaction, commitment)

Operational Efficiencies

Information Sharing &Knowledge Exchange

Positive Work Climate

Individual, Group & Organizational Performance

Cooperation & Problem Solving

HRM = higher trust • HRM policies and practices are

claimed to be amongst the most influential areas for trust development (Robinson and Rousseau, 1994)

• HRM has been proven to be a key agent in building and maintaining trust (Whitener, 2001).

Drivers of trustworthiness (Dietz and Den Hartog 2005)

Ability Benevolence Integrity Predictability

Research sample• Ernst and Young• GKN• Cable and Wireless• Bank Group• Day Lewis Pharmacy• Orvis• John Lewis Partnership• Norton Rose

• HMRC• Department for Business,

Innovation and Skills• Norfolk County Council• Sunderland C Council• Royal Mail• Hants County Council

Key trust relationships

Trustin Leaders

Trust in the Organisation

Trust in the Line Manager

Trust in External Relations

Trust in each other

Trust in each other –“We’re all in this together”

Colleagues

Customers

Organi-sation

Senior Managers

Line Managers

STRENGTHS

• In adverse times everyone pulls on the large trust fund created during the good times to help each other through

• Huge emphasis on INTEGRITY of leaders

STRENGTHS

• Provided leaders can demonstrate their ability, benevolence and integrity they will be able to lead people through adverse times

• Particular emphasis on BENEVOLENCE in leaders (followed by integrity)

Trust in our leaders

Trust in our organisation

The organisation

as institution

Staff

Stake-holders

Customers/service users

SenManagers

STRENGTHS

• Strong on procedural justice through promotion of extremely fair HR systems

• Trust is in the systems and the goodness of the purpose of the institution

• Not dependent upon the cult of the individual leader to promote trust

Trust for our external customers is key

STRENGTHS• Leaders focus on their ABILITY

to keep business on track

• Benevolence of leaders is less relevant as focus is on external rather than internal

CustomersSenior MgntStaff

Trust for our external customers is keyWEAKNESSES• In adverse times, previous lack of

attention to internal trust may mean that integrity or benevolence of leaders is questioned.

• Organisations may not be able to relaunch growth through innovation or be an attractive employer in tight labour markets

CustomersSenior MgtStaff

Trust in the Line Manager

Trust in senior managers

Trust in Line

ManagerTrust in the organisation

Trust in Line Manager - Weaknesses

Organisation Senior Manager

Line Managers may be detached from Organisation and Senior Managers

Climbing out of the valley of distrust

So what did organisations do to retain trust?

Key Learnings

1. Create a Trust Fund – pre-crisis manage trust as a precious commodity

2. Leadership as Service – serving employees as well as shareholders throughout the change process

3. Kill spin – honest communications4. Reengage the Middle and the Local Levels during

change – the local manager is the key trust relationship and so engage them in planning and designing change

5. Reposition the Employment Relationship – manage employee expectations – change as evolution

6. Create a trusting culture - Leaders must trust downwards if they want to be trusted themselves

7. Behaviours – Maximise trustworthiness through constantly demonstrating trustworthy leadership and communication

8. New roles for HR – has the function become too focused on the strategy and not enough on the people?

Key Learnings

Group Exercise

• What are your trust fund accounts looking like today?

• Which ones are in deficit/credit?• What risks are there in this?• Which ones would you wish to focus on

and why?• What can you do as HR practitioners to

raise the levels of those accounts?

Group Exercise

• How well do your leaders measure up to these behaviours? Where are there deficits/credits?

• How should we change the selection of leaders?

• How should we change the development of leaders?

• What is HR’s role in this?

Group Exercise

Given the advances in social and electronic media, why does communication remain a perennial problem for organisations?What should be different about the management, content and process of communications going forwards?What is HR’s role in this change?

Group Exercise

• How can we reap the benefits of middle and local managers going forwards?

• What has to change in the relationships between senior and middle/local managers and middle/local managers and employees?

• How can HR help facilitate this change?

Group Exercise• What has to be different about the expectations of the

employment relationship going forwards for• A) the employer• B) the employee?• How can we start to discuss these changes with both

sides in the employment relationship?• What does this mean in practical terms for HR?

Group Exercise

• How should the HR profession respond to this research?

• If it is too strategic to be seen simultaneously as a champion of employees, who should play that role?

Create a trust fund – keep chargingthe batteries

• Senior managers to be more visible, locally, in a face to face capacity, as well as virtually

• If they cannot be more visible face to face, delegate “leadership” down to local middle managers

• Personal benevolence v. self serving behaviour• CEOs being courageous and taking a moral stance • Public sector leaders – personal, relational and

accountable• Nature of followership also had to change – creating

trust is everyone’s responsibility • Benevolence becomes “two way” – upward forgiveness

Leaders and followers

• Authentic face to face dialogue, not just electronic

• Importance of behaviours not just written words

• Local messaging needed to be regular and relevant to people’s lives

• Above all, avoid “spin”

• Apologising for errors actually increases trust

Communication – ’’Face into the storm!!’’

• Don’t undermine local managers, it is not in the best interest of the organisation because of their trusted relationship with local staff

• The more customer facing your local staff the morecritical it is to maintain the trust chain of…organisation →

senior manager →local manager →

employee

Engaging the middle and the local

• Redefining the psychological contract

• Organisations may need to promise less in their branding but be able to deliver more, an employer in the 21st century can guarantee

Renegotiating the employment relationship

• Some people do not trust HR – see as solely concerned with organisational needs?

• In some cases HR was so downsized itself it was unable to offer much support as a function?

• Is there a role to be a conscience of the organisation?

• Or do we need to rethink our own trustworthiness?

And what of HR?

Next steps• Stage 2 Research project – How to Create Trustworthy

Leaders – CIPD/HEFCE funded. • Unilever, BBC, Church of England, BAE, GKN, John

Lewis, Serco, NHS, Aberdeenshire Council, HMRC, Day Lewis Pharmacy Group.

• Conference – University of Bath, Summer 2014.

• Stage 2 University of Bath Leadership Development –Top Talent Programmes in Trust – variety of private sector and public sector clients working with their talent pools.

Drivers of trustworthiness in Leaders (Dietz and Den Hartog 2005)

Ability Benevolence Integrity Predictability

Professor Veronica Hope HaileyDean of the School of Management

vhh20@management.bath.ac.ukUniversity of Bath

“Trust comes on foot but leaves on horseback”