The One Thing That Changes Everything
Simply put, trust means confidence. The opposite of trust - distrust - is suspicion.
The difference between a high- and low-trust relationship is palpable. Take communication. In a high-trust relationship, you can say the wrong thing and people will still get your meaning. In a low-trust relationship, you can be very measured, even precise, and they will still misinterpret you.
Economics of Trust
Trust always affects two outcomes: speed and cost. When trust goes down, speed goes down and cost goes up. When trust goes up, speed goes up and cost goes down. The serious practical impact of the economics of trust is that we are paying a hidden low-trust tax.
A company can have an excellent strategy and a strong ability to execute, but the net result can be torpedoed by a low-trust tax or multiplied by a high-trust dividend. This makes a powerful business case for trust, assuring that it is not a soft, "nice to have" quality.
How Trust Works
Trust is a function of two things: character and competence. Character includes your integrity, your motive, your intent with people. Competence includes your capabilities, your skills, your results, and your track record.
With the increasing focus on ethics in our society, the character side of trust is fast becoming the price of entry in the new global economy. However, the differentiating and often ignored side of trust - competence - is equally essential.
The 5 Waves of Trust
The 5 Waves of Trust model derives from the "ripple effect" metaphor that graphically illustrates the interdependent nature of trust and how it flows from the inside out. It defines the five levels, or contexts, in which we establish trust. It also forms the structure for understanding and making trust actionable.
The First Wave: Self Trust
The key principle underlying this wave is credibility.
The Second Wave: Relationship Trust
The key principle underlying this wave is consistent behavior
The Third Wave: Organizational Trust
The key principle underlying this wave is alignment. Leaders help to create structures, systems, and symbols of organizational trust.
The Fourth Wave: Market Trust
The underlying principle behind this wave is reputation.
The Fifth Wave: Societal Trust
The principle underlying this wave is contribution.