Leaderonomics

Photo Source: Carnie

Recently, I went to the main office of a local telecommunications company (let’s call it Telco X) to change my company’s mobile phone service provider. To my disappointment, this was how things transpired.

I stepped up to the service desk of Telco X and said: “Hi, I represent my company, and we’d like to start using your telco service for all our company mobiles because we’re really not satisfied with our current service provider.”

The young receptionist’s response was: “Please take a seat”.

After about 35 minutes, she returned with another colleague with a huge pile of forms to obtain our company details.

I found this interaction very disappointing, because the customer service was bad – making a potential business client wait for service.

To add salt to wound, the business service provider didn’t trust me enough to have a direct conversation about what exactly it was that I wanted.

Instead, Telco X was more interested in getting my company details to see if we could actually maintain the business with the provider.

This is a classic case of procedures over people. Stephen Covey, in his book Speed of Trust, calls it the Trust Tax.

Trust Tax is a tax that an organisation is subjected to, which results from low trust interactions with employees and customers.

It leads to snail speed processes and higher costs originating from multiple fail-safe mechanisms.

When I deal with my clients, I am usually more trusting and have faith that they’ll follow through with our agreements.

I find that they respond well to it. It eases my work load and it achieves more personal connection with my client, which makes them a joy to work with.

At a macro level, Asia is up and rising in a variety of fields with companies and businesses that are fueling the world economy. However, one wonders if the economic success in Asia is built on trust.

As a part of my job, I get to work and travel a lot around the region and get the chance to speak to many opinion leaders both in society and business.

Personally, I believe self trust is a very interesting concept for Asia. Asia is big and diverse, but when one frequently flies throughout the region for a couple of years, one gets a good impression of the heart of this beautiful part of the world.

I’m going to narrow it down by talking about trust in the service industry, specifically from three interesting viewpoints: market trust, organisational trust and relationship trust.

Market Trust

“Growth” is the one word the entire services sector (especially financial services) in Asia is hung up on.

In emerging countries like Indonesia, Thailand and Malaysia, customer growth is simply amazing. So even an increase of 1.1 million customers does not seem like a big deal.

A good example of this is Islamic banking, an integrity-based method of banking, which currently grows at an average of 20% each year. Sometimes impressive cases even show profit increments of 45%.

All these profits are fueling the increase of middle-class households rapidly. With money going around, these people are getting all their needs fulfilled – buying products, cars, real estate and such, and making the lives of bankers a bliss.

The economy is growing. However, it’s not because of high trust. The trust is, in fact, low.

As you can clearly see, the reputations of financial services firms are not getting any better. While processes, procedures and profits are on the rise, employee value, on the other hand, is dropping.

Banks, which started off as a brilliant idea to help people financially, seem to have lost their reason for existence.

Let’s take a small start-up for example. An entrepreneur has trouble making ends meet, and experiences cash flow problems when he has to pay his employees at the end of the month. So he goes to the bank to ask for a bridging loan.

The bank says it can only help him if he can show that he has been profitable for five years in a row.

The entrepreneur is puzzled, because firstly, his start-up company hasn’t even been around for that long, and secondly, if he had been profitable for five years in a row, he wouldn’t need a loan. Mr Entrepreneur is asked to leave, as the banker is just following procedures.

This story is exemplary for the entire sector and the way customers are seen.

With no customer loyalty, there are no brand ambassadors and therefore, banks won’t have a strong, sustainable reputation.

They have a responsibility to help people and society, which is what they should be doing during this period of economic growth to reap stability and sustainable growth.

Organisational Trust

In Asia, and even around the world, one of the biggest crises is that organisational trust is low.

Even in Singapore, a country which is among the richest in the world, companies are hierarchical and top-down-oriented.

These organisations are based on low trust. Organisational trust in Asia is in fact among the lowest in the world.

Employees leave the company frequently because empowerment, accountability, engagement and loyalty are at a low, but employers don’t notice because that’s how things are. Besides, business is going great for them.

In China alone, seven million university graduates enter the labour market each year, so finding replacement manpower is quite easy for employers.

This mentality, however, causes great loss in terms of money, energy and resources in hiring and retaining the right talent.

Unfortunately, organisations just don’t realise this.

Relationship Trust

Every weakness has the potential to be converted into an opportunity for improvement. When trust is low, the potential for a connection is high.

In Asia, family ties are a big priority. The trust between family members really depends on how close the family members are.

The weaker the relation and connection, the more fragile the level of trust becomes.

Too often, people tend to place their family members above themselves. Knowing yourself – what you want and what you are capable of, is a new, and foreign topic in Asia, as people often don’t talk about themselves or their personal vision.

In Asia, self trust is a very interesting concept because it’s exactly what people need in order to gain trust.

In Western countries, people focus on individual freedom as their highest achievement, while in Asia, people focus on harmony. They view self-reflection as egocentric.

However, connections can only grow when trust in yourself grows. So knowing yourself makes you a better team player and enables you to give more to other people.

Once people can do that, then relationship, organisational, market, and societal trust will also grow.

Once we achieve a high-trust society, the economy will be able to grow even faster and sustainably.

The current reality of the Asian economy is that growth numbers are high, even with low trust. Just imagine the possibilities, if we, as responsible organisations, trusted each other a bit more.

Organisations hardly realise that although they have profitable policies, a lot of value is seeping away, simply because of the lack of trust in customers and employees.

Only when they decide to focus on sustainable value creation – beginning with self-trust, can they build a brighter future for their employees, customers and society.