Trusting The Top Team

“To whom much is given, much is required.”

We’ve all heard people express their trust or otherwise in the board, but what are the reasonable expectations of employees?

Just as the emotional intelligence of a team is a more complex concept than the emotional intelligence of the individual members, the trust invested in the top team by the employees of an organisation is a different matter to the trustworthiness of each board member in aggregate.

So, what is the board holding in trust for the employees? I am going to highlight three things.

The board is capable

This is the entry level. The staff of an organisation look at their top team and ask whether they are safe in their hands. Do they know the business and are they smart and humble enough? Smart enough to understand the strategic and financial position of the business, humble enough to get down to the shop floor and find out what is going on at the sharp end.

Staff don’t actually enjoy the thought “I could do their job better than they can.” It engenders anxiety. They are looking for a top team that can provide a cogent explanation of why the organisation does what it does and can present a confident vision of the future. They don’t want a board that is out of touch and speaks an alien language of TLAs and management speak in a vain attempt to cover up their incompetence.

The shortcut to losing the trust of your employees as a board is to start taking decisions without objective knowledge of the situation. This includes the instigation of both high profile ‘vanity projects’ and multiple smaller decisions made without reference to the departments charged with their execution.

When Cisco bought Pure Digital in 2009 for $600m in 2009 there must have been people in the Cisco business who had an iPhone 3GS and could have questioned the viability of the Flip video camera and therefore the wisdom of the acquisition. Two years later Cisco discontinued the Flip and wrote off a good proportion of the sale price in the process.

I had an MD once who was reviewing the proposed revised floor plan for my department. He had led the department previously and insisted that it needed space for printing and binding. Despite my attempts to explain that technology had rendered this requirement obsolete in the three years since he had been involved in the day-to-day he was adamant, retorting “If you won’t do it, I’ll find someone else who will.” In one fell swoop he reduced my trust in his judgement and made it less likely that I would be open with him in the future.

The board has our best interests at heart

It’s not unreasonable for the employees to expect that the board makes decisions with the interests of the company, if not its people at heart. After all that is their job description.

In a 2018 interview with Inc, Richard Branson said: “So, my philosophy has always been, if you can put staff first, your customer second and shareholders third, effectively, in the end, the shareholders do well, the customers do better, and you yourself are happy.” If you’re a regular reader of mine you will notice that I have used this quote before (in People, Product and Profit) but it is worth repeating. And his Virgin empire backs up the primacy of people in their business with such initiatives as the employment of ex offenders at Virgin Trains.

Sadly in these days of moral hazard one doesn’t have to look far for examples to the contrary. The board of the UK construction giant Carillion had their snouts firmly in the trough even as the business was heading for collapse. Richard Howson, who led the company from 2012 until July 2017, was paid £1.5m in 2016, including a £122,612 cash bonus and £231,000 in pension contributions. The company went into compulsory liquidation on 15 January 2018, with liabilities of almost £7 billion. (There’s more about Carillion in my article ‘How Big Does the Elephant Have to Get?’)

It’s not difficult to imagine how the employees of the business felt about the greed of their board as the ship headed for the rocks.

The board will pull together

Just as the board expects the operational teams within the organisation to collaborate functionally, the employees are looking to the board to demonstrate effective, even exemplary teamworking: they support one another, they are loyal to persons not present, they express themselves open and honestly. Employees want a top team that is into collective responsibility and not one that takes every opportunity to scapegoat individuals in order to deflect attention from their own shortcomings.

There are parallels here in home life. A child becomes anxious when its parents are fighting. It’s a natural response: right up unto a few centuries ago, the breakup of the home was an existential threat.

In business, fall-outs at board level are often a prelude to poor organisational performance and in today’s VUCA (volatile, uncertain, complex and ambiguous) environment, it doesn’t take many months of that for the very existence of the business to be threatened.

Pivotal questions

So, here’s some questions that every board should ask itself:

1. How does promotion and recruitment function around here? Has the CEO made a genuine effort to surround themselves with people better than they are or have they gone for yes men/women?
2. What is our vision for leadership? Is leadership a responsibility to serve or an entitlement to enrich ourselves at the company’s expense?
3. How do we perform as a team? Are our processes functional and effective? Do we work through our conflicts or would we rather spend our time judging and criticising one another?

Consequences

Many untrustworthy top teams imagine they can behave the way they do with impunity. This is not true.

When a top team is untrustworthy there are consequences for the business: people will withhold information, ideas and commitment; expend energy in complaining to one another; become cynical. All of this will sap the emotional energy that people would otherwise have available for productive work.

And ultimately your most talented people will find themselves somewhere else to work, where they can be freer emotionally and commit to a leadership group that has their best interests at heart.

The good news is that the the converse applies. Make team capability, service to others and functional collaboration your standards at board level and you can be assured that everyone else will likewise excel.