Author Talks: Sandra J. Sucher on the power of trust
In this edition of Author Talks, McKinsey Global Publishing’s Raju Narisetti chats with internationally recognized trust researcher and Harvard Business School professor Sandra J. Sucher about her new book, The Power of Trust: How Companies Build It, Lose It, Regain It (PublicAffairs, July 2021). Based on two decades of research, Sucher and coauthor Shalene Gupta examine the economic impact of trust, and the science behind it, to prove that trust is built from the inside out. The result? A new understanding of the business, economic, and societal importance of trust and how to regain it once lost. An edited version of their conversation follows.
What problem are you trying to solve for with this book?
Business is facing a trust crisis. The 2021 Edelman Trust Barometer showed that business was actually the most highly rated institution, and it garnered 61 percent trust. Government, for example, was at 53 percent. But as business people, if we step back and say, “How do we feel about 61 percent of respondents saying they trust us,” it’s not such a great score. And so trust is when we are willing to enter into a relationship of vulnerability with someone—or an organization—that has power over us.
There was a great study of NCAA basketball players, and what the study found was that the team that had the highest trust in its coach had the highest number of wins, and the team that had the lowest trust in its coach had the lowest score. What this adds up to is a question for business, which is how does a company gain trust? Shalene Gupta and I wrote this book to try to help people understand how trust is built and how to regain it if it’s lost.
Trust in the COVID-19-era workplace
How has the pandemic impacted trust?
I think that there are two dimensions on which things have gotten more focused: the first is companies’ responsibilities for safety. This is kind of a new topic, so unless you’re in extractive industries or something where there are big machines wandering around, and people in them, it’s not something that companies have had to worry about before. But now what you see on every website is, “Here’s how we’re keeping our employees safe. Here’s how we’re trying to keep our customers safe.”
This is a new and ongoing responsibility that really is at the heart of trust, because people are trusting their lives with companies, whether they’re the customers or the employees. The other thing that’s going on is that people have started to think more about their relationship to work. We actually are at a point where we need to knit organizations back together.
And I would probably ask three questions: first, I’d want to know what COVID has felt like for the people inside my firm, and I’d want to find out what their experience of COVID has been. I’d want to know how well they thought we’d done as a company at actually managing the COVID challenge on their behalf and others. And I’d want to know what kind of areas they think we could do a better job in.
On the internal versus external trust challenge
One of the basic principles that we found about trust is that trust is built from the inside out. It’s almost impossible to imagine a company being able to be trusted by its customers if it’s not trusted by its employees. Like any other business process, there are steps you have to follow in order to truly regain trust. All of these go against the normal playbook in companies attending to legal matters first, and really not attending to these trust issues. It’s not that the cost and liability issues related to a scandal aren’t huge; it’s more that regaining trust is a different goal, and if you want a different outcome, you have to work a different process.
The first step of the process is to take responsibility for the harm you’ve created and to apologize for it. So I apologize, myself, to all the lawyers in the room who are screaming at this point, “Don’t do that!” But in fact, trust has a moral domain, and one of the most important elements is peoples’ ability to take responsibility for the impacts that they cause. That’s one of the foundation elements on which we trust companies and other individuals. So the first thing you have to do is to actually say, “We did this thing, we know it’s wrong, and we’re so sorry for the problems that we caused.”
The second step—and this gets hard—is to fix accountability for what was wrong. Now, this is a place where most companies pull back and they say, “Well, you know, it was those people down at the bottom who did these things.” But peoples’ demand for fairness is that they know the companies are hierarchies, and they reasonably, in a moral sense, hold the person at the top of that hierarchy responsible for what happens on his or her watch.
Now, there’s actually some interesting research that says that you can punish CEOs and get the same effect, like take away some compensation. But what people care about is that the person who is responsible—really responsible—for what goes on be held accountable. And then the third step is a long-term strategy for trying to fix what caused the breach in the first place.
So it’s these three steps: apologize, fix accountability, and manage the long-term foundation issues that created the breach in the first place.
Read the full interview here.