I’ve just had the rather humbling experience of watching a TEDTalk from Joe Gebbia, one of the founders of Airbnb. (And a big thanks to Joss Sargent from Capitalise for forwarding me the link). He is funny, honest and self-deprecating, particularly for someone worth north of $3.7bn. He’s honest enough to admit that he rather stumbled on the idea of Airbnb’s concept and that the key issue they faced in terms of getting it off the ground and attracting both customers and investors, was one of trust.
Today, the organisation is a key pillar of the sharing economy and more than 3m people made use of Airbnb on New Year’s Eve 2017. However, it faced a massive challenge a decade ago in terms of getting hosts to trust its guests – and vice versa. In what sort of state would guests leave the accommodation and did, in fact, such accommodation actually exist?
The sharing economy term, which first emerged in 2010, through the book ‘What’s mine is yours – the rise of collaborative consumption’ by Rachel Botsman and Roo Rogers. For the authors, trust is the essential building block in creating a brand, reputation and relationships in a sharing economy.
We see the implications of trust, or indeed mistrust, all around us. It influences behaviours and choices and how we process and perceive brands. Which of us is hugely keen to hop back onto Boeing’s presumably improved 737 Max planes when they return into service – not simply because of the two horrendous crashes but also because of the manufacturer’s disinclination to be too generous with the truth?
Last year, Facebook was due to release both a dating app and another that enabled users to share videos and photos. Apparently, the technology behind such apps was excellent but because of Facebook’s misuse of its users’ personal data and the Cambridge Analytica scandal, few stakeholders could recommend the product because of some rather glaring trust issues the social network continues to wrestle with, according to TechCrunch.
The Economist, in the wake of the Cambridge Analytica furore, published an article on eight similar organisational crises, including Uber and Wells Fargo. Because of the resulting lack of consumer trust, the eight companies in question lost an average of 30% of share value as a result.
Just as trust influences our buying decisions, then, it follows it has a significant impact on our employment choices.
There’s a lovely example of this from 20 years ago and Holiday Inn. The organisation did a significant amount of research into the relationship of its branch employees and their managers. An eighth of a point increase in employees trusting their respective branch managers resulted in an individual hotel experiencing a 2.5% annual profit increase.
I’d suggest that a similar study today would point to an even greater return.
PwC, in 2016, suggested that 55% of all global CEOs felt that a lack of internal trust across their employee base was a threat to organisational growth. The business services firm expanded such thinking: ‘If companies build trust in the workforce, they’ll create value – for the business and for individuals’. The firm suggests that harnessing the trust dividend internally can create a 6% increase in revenue growth.
The Facebook story is fascinating too from an employment perspective. There is now so much more data available not just surrounding social media users but employees. Organisations that can successfully harvest and use such data in a transparent and honest manner can deliver on so much potential. Think about IBM’s recent claim that its internal AI means the firm knows with 95% certainty which of its employees are likely to leave the company.
This is a point emphasised by Ellyn Shook, Chief Leadership and Human Resources Officer at Accenture – ‘Responsible leadership is the key to building employee trust. Trust is the ultimate currency – it’s the path to innovation and fuels growth by unlocking people’s potential’.
Trust influences not only big picture thinking, such as the examples above, but also some key tactical issues touching talent acquisition.
Take employee referrals. Potentially a much under-exploited hiring channel in UK markets. There are many reasons that domestic referrals lag significantly behind the US, for example. And trust is definitely a factor.
Do we trust the candidate experience of our employer? Would we want our friends and family to undergo such a journey? Do we trust our employer sufficiently to communicate promptly and courteously with such candidates?
Similarly, do we trust the Employee Value Proposition our employer is delivering to such friends and family? Is it authentic? Does it deliver what it is promising? Or do we know only too well of its fast and loose relationship with the truth?
So much about employer branding is predicated on trust. We tend to be hugely influenced by employee stories delivered via video. In the right hands, such stories build and enhance an employer brand. They are a window into an organisation and its people. They portray individuals we can empathise and associate with.
But only if we trust them. Only if we believe the essence of what such people are saying. If Facebook, for example, has tended to steer clear of the truth as regards user’s data, what sort of level of trust are we likely to attach to what their employees are saying?
If the eventual and distinctly reluctant apologies of Mr Zuckerberg have led to millions departing the site and very few embracing the idea of sharing videos, photos or even love, then is their employer brand likely to have emerged unscathed?
Trust supports so many of our expectations around modern employment practices. Flexible and remote working, for example. Increasingly, these are nearly pre-requisites for employees – they will judge a current employer against a potential one on the basis of their relative flexibility. But such flexibility is predicated on trust. Do employers and managers trust their people enough to make such working practices function effectively? And, at the same time, do remote-working employees trust their organisation and managers to communicate with them and continue to make them feel involved and engaged?
There are so many deliverables if an organisation can truly embed trust within its cultural norms. A fascinating piece of research from Paul J Zak, Professor at Claremont Graduate University, suggests that employees working within high-trust companies took 13% fewer sick days, were 76% more engaged and were 50% more productive than their low trust equivalents. From a recruitment and retention perspective, 50% more employees working in such environments planned to stay with that organisation over the next 12 months and 88% would recommend it as a place to work for their friends and family.
Let’s return though to Joe Gebbia. His particular focus in the TEDTalk was around design – creating the right amount of information so that both hosts and visitors would trust each other. One of his early sticking points was around inclusivity – hosts would be more inclined to hire out their property to people like themselves, with similar backgrounds and characteristics. Perhaps understandable but unlikely to help Mr Gabbia and his colleagues grow Airbnb.
However, a solution did emerge. If a host saw three recommendations and positive reviews about a potential visitor, then their bias was likely to remain as it was. If such a visitor managed to attract ten positive reviews, then, regardless of their background and difference, the host would put aside such bias and inherently trust them.
(Would that recruitment was as successful at building trust and ridding us of perceptional bias around those we sense are different).
The benefits of building and maintaining trust within the workforce are clear. If an organisation’s culture enables trust to flourish, then people are more likely to stay, more likely to take risks, to be themselves, to be creative, more likely to invest themselves in their employer. They are more likely to develop their potential, in the eyes of Accenture’s Shook.
There is, too, a clear relationship between an organisation’s culture and its Employee Value Proposition. The former should inform the latter. The latter is the tangible demonstration and expression of the former.
If both are authentic and genuine, then an organisation is halfway there to constructing a working environment based on trust.
And enhancing levels of trust within the workforce delivers benefits which extend beyond recruitment and retention. The always fascinating Edelman Trust report for this year suggests that 76% of the UK population feels that the way an employer treats its employees is one of the best indicators of its levels of trustworthiness.
Delivering an EVP which speaks to trust, which suggests that trust is a core element of your working culture, which is credible and demonstrable, can deliver massive talent acquisition and productivity benefits.
benebenefits.
Getting to the heart of your employee mindset 