Smart Trust

Stephen M. R. Covey and Greg Link, with Rebecca Merrill

Free Press, 296 pages, $29.99

 

In their look at well-performing government organizations around the world, The Three Pillars of Public Management, Ole Ingstrup and Paul Crookall identified trust as a crucial element for success. Trust is the lubricant that keeps relationships and organizations running smoothly. 

But trust can be slippery, hard to get a handle on. We shouldn’t need a manual to be trustworthy – if we’re faking it, subordinates know – but in a networked world with today’s daily swirl and prevailing cynicism, trust can be complicated. Stephen M. R. Covey (author and the son of Seven Habits of Highly Effective People guru Stephen R. Covey) and Greg Link offer some assistance in their new book, Smart Trust.

Smart trust can be distinguished from blind trust. It follows the old Russian proverb that U.S. President Ronald Reagan famously revived in his dealings with the Soviet Union, “Trust, but verify.” In our own lives, it means starting with a propensity to trust but also combining that with analysis to figure out how best to manage that trust.

Muhammad Yunus displayed smart trust when he established the Grameen Bank. He loaned money to people who nobody else would dream of giving money to. They were impoverished, generally female, with no collateral, no steady employment, and no verifiable credit history. He believed they would repay his loans, and indeed they did – the 98 percent payback rate was in fact higher than conventional loans at banks. But to be careful, he set up support groups for borrowers to encourage and help one another with their new businesses and loans. He also helped them to create a self-policing system that would encourage responsible behaviour by the group members since all their reputations would be bound together by this network. Trust, but smart trust.

EBay is another example of smart trust. On the surface, the business premise is ludicrous. People from around the world, who have never met each other and are in different legal jurisdictions, are swapping goods, with money transfers handled, on faith, between them. It sounds like a mecca for con artists. But Pierre Omidyar, the site’s founder, had a belief that most people are basically good and can be trusted and the site has flourished. His team developed a strong set of transparency and feedback procedures that help the traders to police the site – their site, in effect. And the company has instituted sophisticated measures to detect inappropriate behaviour, fraud, and attempts to hawk counterfeit goods. Trust, but smart trust.

The authors say smart trust, at its essence, is judgment, a quality leaders are expected to have. It minimizes risks and optimizes possibilities. It requires overcoming our inherent distrust of others, instilled in us as youngsters by our parents’ warnings about strangers. “Although Stranger Danger may be a good thing to teach kids, it can become a large problem if it becomes the basic way we look at all relationships throughout our lives – if we allow a protective response to the five percent who can’t be trusted to drive the way we interact with the other 95 percent who we can. Stranger Danger can script us, at a young age, to be suspicious and distrusting,” Covey writes in one of the sidebars of the book where the authors give personal anecdotes.

The authors set out five actions that will help to make smart trust work for you:

1. Choose to believe in trust: belief is the foundation for getting results in any area of our life, and that applies in trust as well. Indeed, they note that what we believe is even stronger than what we know because belief drives our behaviour and our actions. “Deciding to believe in trust is a choice, the fundamental choice out of which all other Smart Trust actions flow,” they note. 

In their work with high-trust individuals, teams and organizations around the world, they found three beliefs that animated trust. The first is that you and people you are dealing with must believe you are worthy of trust. That belief will often flow from situations where you forsake immediate benefit to act in a decent, honourable way. The second belief you must accept is that most people can be trusted. Successful high trust people don’t let the small minority who can’t be trusted define the vast majority who can. The third essential belief is that extending trust is a better way to lead, because it inspires people to perform and generally will be reciprocated, ultimately leading to greater prosperity, energy and joy.

2. Start with self: beyond belief in trust, you must behave with trust. And that starts with your own actions. It will be easier for people to trust you if you are seen as honest, straightforward, dependable, and genuinely concerned about their welfare. Ask yourself whether your character and competence add up to a person or organization that others can trust. 

They point to the emergence of Singapore as a powerhouse nation as an example. “Over the last several decades both its character (demonstrated by its low corruption and mentality of national service) and its competence (demonstrated by the way the country has reinvented itself while simultaneously increasing productivity and competitiveness) have made Singapore highly credible and given its citizens and the world a country they can trust,” the authors state.

3. Declare your intent: charity starts at home, and so does trust. Declaring your intent at the start of situations such as negotiations is an accelerator of trust. Let people know what you are seeking, and also be open so they can see you have no hidden agendas. Together, this will diminish suspicion.

The authors distinguish two elements to declaring intent. We must declare what we will do but also why we are doing it: “Sharing the why behind the what makes a profound difference in how others interpret our communication up front, as well as how they interpret our subsequent behaviour.”

As well, you must assume positive intent in others. PepsiCo CEO Indra Nooyi says she learned this approach from her father, and it has been powerful. “When you assume negative intent, you’re angry. If you take away the anger and assume positive intent, you will be amazed. Your emotional quotient goes up because you are no longer almost random in your response. You don’t get defensive. You don’t scream. You are trying to understand and listen,” she says.

4. Do what you say you are going to do: if you don’t live up to your commitments, you will squander trust. In almost every nation, culture, religion and philosophy for effective living around the world, the authors found “do what you say you are going to do” was an important value and significant measure of trust building. In essence, it’s a global standard, and so in a multicultural world, whether dealing with colleagues at home or folks in other countries, you want to avoid failing on this measure. “Delivering promised results – doing what you say you are going to do – generates trust faster than any other action. This is particularly true when circumstances make it difficult,” they add.

5. Lead in extending trust to others: most of us can remember a time when somebody extended trust in us, and how gratifying and empowering it was. We need to do the same for others. Acting with such faith and trust unleashes human potential and multiplies performance. It engenders reciprocal trust.

“This action is more than choosing to believe. It’s choosing to act on that belief – to take the steps, to make the leap. The belief that it will pay off is what gives a person the courage and faith to do it. And it’s the job of a leader to go first,” they point out.

Government executives, of course, in an era of accountability and media