Leadership Lab: Management Competencies

Trust and Leadership

Feb 24th, 2010
By Ahmed Abdel-Aziz

Trust & Leadership

1. Abstract

Trust – a key tool used by all effective leaders. This paper will discuss three main points:

• The importance of Trust in leadership
• How to build Trust
• How leaders use Trust to do good or evil

The paper will highlight why Trust is a powerful tool for a leader, and how to build that tool. Like many tools,“Trust” can be used for good and evil applications, and some examples will be provided.

2. Importance of Trust in Leadership

Trust is the highest form of human motivation; it can bring out the very best in people (Covey, 2004). It is said that to be trusted is greater than to be loved (Covey, 2004). A leadership approach, referred to as Trust- Centered Leadership™, puts trust-building at the forefront of the leadership agenda (Armour, 2008). The approach measures every decision, action, and initiative against the goal of maximizing Trust:

• First, maximizing the Trust the organization has in its leaders
• Second, maximizing a culture of Trust across the entire organization
• Finally, maximizing the Trust of both internal and external customers
  

Trust-Centered Leadership™ does not replace other leadership styles, but works alongside these styles to intensify a leader's credibility, leverage and impact as a leader. The importance of Trust can be demonstrated by a Watson Wyatt Worldwide Consulting research. It showed that in companies where Trust was high, shareholder returns were 43% higher than in low-trust companies (Armour, 2008). Trust empowered leadership in these companies to achieve better results, and there is a logical explanation for this outcome. According to Arie de Geuss, one of the world’s most effective business strategists, the speed at which a company learns is a company’s only sustainable competitive advantage. The higher the Trust, the more readily a company can learn, reevaluate, and change. A high-trust culture in a company can significantly increase the speed of learning, and consequently its competitiveness. This shows why leveraging the Trust “tool” would serve a business leader well.

To further emphasize the importance of Trust, we will discuss another trust-focused leadership style referred to as Transformational Leadership. Transformational & Transactional Leadership are two terms coined in 1978 by James Burns. They are two leadership styles that complement each other. Transactional style is based on a transaction or exchange of something a leader possesses that the follower wants in return for the follower’s services, while the transformational style is based on a higher-level relationship that does not depend on such an exchange. Although the transactional style may be the most prevalent, the transformational style can produce higher results and describes the ideal situation between leaders and followers (Homrig, 2001). In this ideal situation involving transformational style, both the leader and followers share the same goals and values (principles regarded as worthwhile or desirable). The leader and followers apply the dictates of these values even in the absence of incentives, sanctions, or witnesses, thus raising themselves above self-interest. They will do whatever it takes to perform their exacting duties. In order to move followers into the transformational style, four essential components are necessary. The first component is “genuine Trust must be built between leaders and followers.” Also similar to the transformational style is a four-step leadership process called “The 4 Imperatives of Leadership”, which is described in Stephen Covey’s book, The Leader in Me. The most important similarity is that “Inspire Trust” represents the first step in The 4 Imperatives of Leadership. The process can be applied at home, in school, in business, and other environments too. The first step in both high-value leadership models (“Transformational Leadership” and “The 4 Imperatives of Leadership”) is building Trust.

In addition to the above, there are many other references highlighting the importance of Trust in leadership. One example is the “Four Competencies of Leadership” by Warren Bennis (Northcutt, 2008), a pioneer of the contemporary field of Leadership studies. The next section will highlight how to build that very valuable leadership tool called Trust.

3. How to Build Trust

"Men of genius are admired, men of wealth are envied, men of power are feared, but only men of character are trusted” - Zig Ziglar. To be trustworthy, a person needs to have both competence and character (Covey, 2008). Competence is a sufficient quantity of knowledge, skill, or ability; while character is what you really are, your inside (WikiHow, 2009). Clearly, to have character is the harder part of being trustworthy. A person with strong character attracts followers and shows he/she can be trusted (Clark, 2008). Strong character shows drive, energy, determination, self-discipline, willpower and nerve (Clark, 2008). Therefore, to be capable of building genuine Trust, it is logical that one needs to build character first (Armour, 2008).

In order to build Trust more easily, it is good to know two key characteristics of Trust. First, Trust is a two-way street: followers trust leaders, and leaders also need to trust followers. If leaders choose not to rightfully trust their followers, the result will be that the leader will also not be trusted. There are many quotes of prominent figures stressing the importance of the two-way Trust characteristic (MCA, 2009). Second, the level of Trust between a leader and followers is a variable that goes up and down; the effort needed to increase that level of Trust is much higher than the effort needed to decrease it (Covey, 2004).

After doing research on how to build Trust, I noticed that the common principles emphasized the importance of attributes such as honesty, integrity, loyalty, courage, etc. While useful, the sum of all these attributes constitutes character; so the basic message again is one needs to have character to be trustworthy (Covey, 2008). Therefore, I will highlight how to strengthen character as a different approach to how to build Trust. Below is advice on how to strengthen character (WikiHow, 2009):

• Have freedom from prejudices so that you love others as yourself
• Understand why strength of character is important – it allows you to carry out your will freely, and accomplish your goals
• Empathize, rather than just sympathize with others – go from an emotional passive reaction, to engaging as needed to help others
• Seek the truth and favor reason over emotion
• Be neither a pessimist nor an optimist, but a leader
• Guard against irrational impulse – Learn to master your feelings
• Be content with what you have – Focus on the positives in life
• Be brave enough to take calculated risks – be courageous enough to contribute to the progress of mankind
• Find the right path, and walk therein, neither turn to the right nor to the left – Govern yourself and never abandon the right path
• Learn to do good – aim not after personal goals, but after noble and worthy motives to benefit society as a whole
• Be patient, oppose fatalism, and overcome all fears
• Always be honest, dishonesty is an assault upon your own character
• Do your best in whatever you do, excel wherever you are
  

By strengthening character, a leader will become more trustworthy, and therefore in a much better position to build Trust with followers (Armour, 2008).

The next section will highlight good and evil applications of effective leadership that is based on Trust.

4. Use & Misuse of Trust – Good & Evil Applications

As mentioned in the section “Importance of Trust in Leadership,” Trust can intensify the leverage and impact of a leader, which paves the way for powerful leadership styles, such as Transformational Leadership. When Trust has been built between a leader and followers, it becomes a powerful tool that a leader can then use to do good or evil (Homrig, 2001). In evil applications, an unscrupulous leader builds Trust with, and exploits, naive and unsuspecting followers. In this case, the leader deceives his/her followers by appealing to their values and ethics inducing them to fulfill the leader’s needs, not the needs of followers (Homrig, 2001). The result could be genocide; sexual abuse; crime; or terrorism in the name of religion, in the name of anti-terrorism, or in any other name. On the other hand, in good applications, a scrupulous leader builds genuine Trust with followers. In this case the leader unleashes the full potential of the followers and leads them to achieve their higher order needs (Homrig, 2001). The result could be self-actualization of followers, advancing humankind, or the spread of justice and mercy in the world.

Based on the objective and intent of the leader, I noticed that with time, and after the leader is gone, followers will either multiply or decline. After a scrupulous leader is gone, Trust in the leader remains because the leader’s objective was good, thus followers can increase even after the leader is gone. After an unscrupulous leader is gone, Trust in the leader also goes away because followers eventually realize the leader was not the character they thought he/she was, and hence does not deserve their Trust. Without Trust, leadership is not based on solid ground and so the number of followers declines (Clark, 2008).

5. Conclusion

Using Covey’s premise that Trust is the highest form of human motivation, the paper’s objective was to highlight the importance of the Trust tool in leadership, how to build that tool, and how it can be used or misused. This was done by discussing high-impact leadership styles that focus on Trust, followed by how to build Trust by strengthening character, and ending with some good and evil applications that leverage the power of Trust.

In the Importance of Trust section, the key topics included how Trust can bring out the very best in people and organizations through leadership styles such as Trust-Centered Leadership™, Transformational Leadership, and The 4 Imperatives of Leadership. In How to Build Trust, it was noted that building Trust is much harder than losing it, Trust needs to be given for it to be received, and strengthening character is the key to building Trust. Finally, the paper also touched on leaders who have used Trust to either spread good or evil.

For any leader seeking to become an effective leader, “Trust” is a key tool to use to significantly increase the leader’s impact (Covey, 2008).

6. References

1 Covey, Stephen (2008). The Leader in Me. Simon & Schuster.
2 Covey, Stephen (2004). The 7 Habits of Highly Effective People. Free Press.
3 Northcutt, Stephen (2008). Leadership and Management Competencies. SANS Institute.
4 Homrig, M. (2001). Transformational Leadership. Retrieved December 30, 2009, from Strategic Leadership Studies and Development Web site: http://leadership.au.af.mil/documents/homrig.htm
5 Sonneman, M. (2008). Leading Virtual Teams – Secrets of Building Trust and Rapport Online. Retrieved December 30, 2009, from Buzzle Web Portal: Intelligent Life on the Web, Web site: http://www.buzzle.com/articles/leading-virtual-teams-secrets-of-building-trust-and-rapport-online.html
6 Clark, D. (2008). Leadership – Character & Traits. Retrieved December 30, 2009, from Web site: http://www.nwlink.com/~donclark/leader/leadchr.html
7 Armour, Mike (2008). Leadership and the Power of Trust: Creating a High-Trust, Peak-Performance Organization. LifeThemes Press.
8 WikiHow – The How-to Manual That You Can Edit (2009). How to Strengthen Character. Retrieved January 7, 2010, from Web site: http://www.wikihow.com/Strengthen-Character
9 MCA Professional Services Group – Quotations on Trust (2009). TrustIsPower.com. Retrieved January 5, 2010, from Web site:http://www.trustispower.com/quotes/quotes.htm