The key in leading successful organizational change is Trust-based management

Trust-based leadership is about leading and creating results through trust. It is about building strong and good relationships and getting the best out of your employees. It is a conscious and active understanding that it is the employees’ competence, creativity and knowledge that underlie new development, innovation, quality and customer and user experiences. There is much to be learned from those who are good, but the ability to bring out the best of the employees is not copiable and is increasingly regarded as the decisive advantage for creating results and achieving set goals. People basically want to do a good job, want to master, and contribute to the community. This human view is the foundation of trust management. It is about creating the conditions that help to unleash the potential of the individual employee and the organization together.

This is also the key factor to unleash the potential of the organization in a demanding change process waiting ahead. The changes are happening faster and faster, within the world of technology we see an exponential development far beyond what one could imagine 3 years ago. In other words, change accelerates with each passing, second, minute, day, month, and year. The exponential growth of technology has enabled new products, services, and businesses to rise to prominence in short time,  and has caused others to become obsolete just as quickly. It is perhaps no wonder that with such a fast rate change it turns out that 70 percent of all organizational change efforts fail, cost more, or take longer than expected. To be able to lead people through successful change the personal skill  must be trained, developed, and practiced over time, it takes time to learn how to navigate the complexities of organizational change.

One of the keys to succeed with organizational change is trust-based management. If you as a change executive, CEO or an interim executive do not earn the organizational trust, the employees will not buy-in to the change. I have been in organizations where the CEO has by no means managed to build trust within the organization. Which also means that the change initiative that has been decided fails right from the start. Which in turn means that employees question the managements motives, drag their feet, or actively work against the change. It is therefore critical that senior executive contribute to build and foster a culture of trust before, during, and after a change effort if they want to have any chance of success.

Back to the 2000s when I was studying the first year at the Norwegian School of Management, I was incredibly lucky to study with one of the top-level union leaders in Norway. At the time, he was a union employee at one of the country’s largest media groups. In the time we studied together he went from being a corporate representative to being elected second deputy leader of one of the country’s major unions in Norway. Later he was also elected first deputy leader in the same trade union on national board. In other words, he ended up being second in command in Norway in that union which organises employees in sectors such as service, administration, finance, marketing, banking, sales, shops, aviation and tourism, organisations, media and publishing, and transport.

He taught me the importance of spending time building trust and dialogue with the unions and employee representative. That is why, through all the large and demanding turnaround processes that I have been brought in to lead, I have spent a lot of time on dialogue with the various unions. Which also has meant that I have never experienced resistance or problems with employee representatives and union representatives so far in my career. Many have wondered how this has been possible, personally I am sure that the only reason I have succeeded is the time I have spent building trust with the employees, and especially with the unions. I have never had a hidden agenda, from the first day I joined an organization I have been open about why I have come. I will lead the restructuring of the organization. Something that will be very demanding and as a consequence of changing work processes and efficiency requirements, some employees will unfortunately lose their jobs. By being open from day one, I have managed to build trust on why exactly I am there and what is my mandate.

Importance steps I have used to build trust during several of the transformational change

I. Good communication and dialogue

As mentioned above I have prioritized to spend time in the organization and build an open dialogue to build trust with the trade unions. Thus, everyone has understood that my mandate is to streamline the organization and that in turn will mean staffing down.

Through the open dialog I have communicated clearly what will happen when and given the  direction. Clarity, communication, and reciprocity are key words. Trust is mutual: You need to ensure that employees experience community in direction and meaning and know commitment and responsibility – because they want to contribute. As a senior executive you are committed to communicating well, in meetings with one to many, and one to one. You need to establish arenas for communication and be aware of reciprocity and how communication works.

It is about being seen and taken seriously. Through an open and good dialogue, you need to accept and give feedback. This will then be an arena for learning, a basis where growth and development are ensured. Good leaders spend time in the organization and have frequent one-on-one conversations – which are useful and relevant to both. This contribute to facilitates the connection between overall goals and the individual’s contribution, good mutual expectations, feedback, and learning, which in turn helps to achieve common goals through reciprocity and shared internal commitment.

II. Set realistic expectations for the for the transformation period

One of the primary ways trust is eroded is a failure to meet expectations is where the senior executives can easily over-promise the benefits of the proposed change effort.

Some time ago, I sat in a boardroom where the CEO had a meeting with all the company’s elected representatives. In this meeting, the CEO told everyone that “the company can never go bankrupt, we have plenty of liquidity”. Something that was not correct since the company’s equity was almost lost at that time. And when those benefits are not achieved, trust is broken. Once employees lose trust, it is hard to regain it, which handicaps future change efforts. Set clear and realistic expectations and then work hard to hit those deliverables.

III. Listen to employees’ concerns and address their issues

Research shows that people have predictable stages of concern when faced with a change. As a senior executive you will improve the chance of success if you proactively address employees  concerns, rather than finding yourselves on the heels having to react to resistant employees. The first stage is information concerns. Your employees need to know what the change is and why it’s needed. Rather than sweeping all the problems under the rug and pretending there was no danger of losing the company’s equity. I was open and told if we are unable to reduce the company’s cost base, the company’s equity will be lost, which in the worst case could mean bankruptcy. The second stage is personal concerns. Team members want to know how the change will impact them individually. Will I win or lose? What’s in it for me? Will there be new expectations of me? The third stage is implementation concerns. What do I do first? Second? Will the organization provide the necessary resources? Will I have enough time? Will there be new training involved? It’s critical for leaders to address these stages of concerns to alleviate fear and anxiety so their team can embrace the change effort.

IV. Share information liberally

“People without information cannot act responsibly. People with information are compelled to act responsibly.” You can fall prey to not sharing information because you fear people won’t have the proper context to interpret what it means, or you feel that people may take information and act in irresponsible ways. The root of this fear is a lack of trust. The opposite of trust is control, so when leaders withhold information, they are showing a lack of trust by wanting to control what people know, when they know, and how they know it. In the absence of information, people will make up their own version of the truth, and often, that version will be a more negative view of the truth than what it is.

V. Have an open-door policy and make it safe to contact you as a CEO or as a senior executive

NO employees will embrace taking risks or innovating in new ways if they are fearful of being punished, criticized, or looked down upon for making mistakes. Leaders have the responsibility to create an environment of psychological safety where people feel safe putting themselves on the line, such as asking a question, seeking feedback, reporting a mistake, or proposing a new idea The three most powerful behaviours that foster psychological safety are being available and approachable, explicitly inviting input and feedback, and modelling openness and fallibility. Employee will embrace change more completely when they feel safe to express their true thoughts and feelings without fear of admonishment.

VI. When you do not know the answer – admit you do not know

As a CEO or senior executive, admitting you do not know something can be one of the most powerful trust-building behaviours you can use. It shows humility and honesty to admit you do not have all the answers. But by showing that you do not actually know, you also show that you as a top leader are vulnerable. It is easy to let our egos get in the way and not want to appear incompetent or unable. Instead of spinning the truth, evading answers, or tap-dancing around difficult questions, admit you do not know but commit to finding the answer. Your people will trust and respect your authenticity.

VII. Invite and involve employees in planning and implementation

A great saying is, “Those who plan the battle rarely battle the plan.” Employees take ownership over plans they are involved to create and implement. Successful change efforts are those that are done ‘with’ people, not ‘to’ people. Involve your team in planning and implementing the change effort and it will go much smoother than if you try to force it upon them.

Leading organizational change is tough work! Rather than carrying all that weight alone, why not spread it out among your team? Get them involved, make it safe for them to participate, address their concerns, be honest and authentic in your dealings with them, and be the torchbearer for leading with trust.

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