David Horsager, the author of The Trust Edge talks on What’s Trust Got to Do With It? at TEDxUMN.
Full speaker bio:
David Horsager – Leadership Keynote Speaker, Business Strategist, Best-Selling Author
Today’s newspapers, and what do the headlines have in common? One thing, trust.
Can we trust the officers? Can we trust the prosecutors? Can we trust turkey is safe in Minnesota, to eat? Can we trust that Democrats, and Republicans will work together to make this budget deal? Can we trust Iran means what they say? Can we trust big business? What’s trust got to do with it? Everything.
Today, I want you to think bigger about trust, and the impact of trust. You know, my kids understand trust. Public restroom, the stall was not available, but as you can see, they trust each other. Every mom in here is thinking: “That boy on the bottom better wash his hands.”
Everything is built on trust, from financial institutions, to personal relationships, everything, and yet we can think we know it all about trust. Do we really, or is it more complex than we might think? You know, we can sometimes think it takes a long time to build trust, and yet in a crisis like 9/11, strangers trusted each other in moments.
A leader can think: “We’ve got to extend more trust. The more we extend, the more we’ll get out of our team.” Unless they extend too much. I hear it all the time today. “People trust the transparent, you’ve got to have transparency, you’ve got to show everything,” and yet confidentiality is also trusted.
My graduate research led me to believe that trust is the single uniqueness of the greatest leaders, and organizations of all time. I love doing the research. I love writing on it. I love working with great organizations: Wells Fargo to FedEx, to the Yankees, to John Deere. But today, I want to go back to my original training ground of trust. Back to where I grew up, the bean farm in North Central Minnesota. You know, I want to think about where I started to think about how a lack of trust is your biggest expense, about how you actually build trust, and that might be more than you think, about how trust is a choice.
Verndale, Minnesota. 500 people live there, a lot more cattle. It’s about a 3-hour drive, Northwest of the twin cities, Minneapolis-Saint Paul. But I didn’t grow up in Verndale, I grew up 8 miles north of Verndale on a 1,200 acre bean farm. I remember taking the bus home every day from school, peering out the window, half way home, I’d look out the window, and there at the end of his long driveway, Mister Olson’s veggie stand, and amidst the produce, right next to the strawberry, the squash, and the sweet corn, was a bucket, a pail with cash bills, money sticking right out of it, plain as can be. But nobody worked the stand.
What are you supposed to do at Ralph’s stand? Pick what you want, make your own change, pay what you owe. He ran the stand, on the honor, or trust system. Whoa! What an efficiency! He saved money, because he didn’t have to hire anybody be there. He saved time, because he didn’t have to be there, and people could choose as fast or as slow as they want, they could pick what they wanted, they could make their own change, people didn’t have to take off food gloves, or latex gloves, they could move right through, and boy, did he have loyal customers. Partly because of trust.
Where we have trust, we have a great advantage. Some of the research showed mistrust more than doubles the cost of doing business. In one of the pieces of research, high-trust companies outperform low-trust companies by nearly 200%. This is basically the sum-up of the first half of my research. Every single time trust increased, just a little bit, this is exactly what happened in organizations, profits, nonprofits, professional sports teams, even governments. Every single time, trust increased a bit, output, morale, retention, productivity, innovation, loyalty went up.
Every time, real cost, time, it all went down, stress went down. Think about innovation, you’ve got a team you trust, you’ll share ideas. Team, if you don’t trust each other, you won’t share ideas. Creativity goes up. I believe the single metric of success comes down to trust. If you think trust is just a soft skill that doesn’t really affect, impact to the bottom line, ask Brian Williams, ask Target Corporation, ask Tiger Woods.
Think of Tiger, one breach of — 27 breaches of trust. He lost $110 million in two weeks, in endorsements that he’ll never recover. Your credit score is a trust score. The more a lender trusts you, the less you pay over the course of a loan. Everything’s tied to trust. There’s even research that shows in countries where citizens trust each other more, poverty is less, and vice versa.