Lessons I learned about ‘Trust’ from customer experience at Yarra Valley Water.
The world has changed. Businesses are now accountable for more than just great customer service. Imagine that you are watching a news story about a woman who was killed by her partner in a family violence incident. Then imagine the feeling as you realise your organisation was part of the cause – the perpetrator has used your latest digital innovation to find a person escaping an abusive relationship. How do you feel? How do you think the world views your business? Do you think consumers will trust you to act in their best interest? How will the market or government react? While this is an extreme example, for many reasons business is losing the trust of society and the problem is escalating.
The statistics: a cause for concern
Statistics tell us we are in the midst of a global trust crisis; trust in business, government and NGOs is in freefall. In Australia today, 60 per cent of our population are in an active state of distrust – yes that’s 60 per cent! And trust in the system is declining, according to the 2017 Edelman Trust Barometer – 53 per cent of people adhere to the populist mantra that the system is failing them, pointing to inequalities arising from the erosion of social values.
We constantly see examples of this – and news stories such as the Volkswagen emission scandal, or the Panama Papers, which exposed countless cases of company tax evasion, fan the flames of public distrust. With distrust comes the expectation of future ethical behaviour. Research by Quantum tells us that 58 per cent of Australians expect business to give back to the community.
I find these statistics disappointing. In 2017 we should be a more progressive society. For me, as Operations Manager of the Thriving Communities Partnership, these stats reinforce the importance of our cross-sector collaboration, which seeks to provide all people with fair access to the modern essential services we need to get by in contemporary Australia. Throughout my career I’ve developed a number of valuable insights into the importance of trust in business. Here's what I’ve learned.
“Trust, as a human condition, is critical to the functioning of society and the relationships between people and institutional systems. For business, trust drives consumer loyalty and is therefore an imperative to growth and sustainable competitive advantage.”
What ‘trust’ means to people and why business should care
- Trust is a human condition that transcends culture, gender, age or ethnicity; it's both emotional and rational, and is one of those human needs that binds us together as a society.
- Trust is also an attitude – it’s the result of what we know, how we feel and what we do about something.
- Trust is critical to the functioning of society and the relationships people have with institutional systems.
With the trust of consumers, business can nurture relationships that promote the confidence and candour that is vital to early intervention for vulnerable consumers. Conversely, when business loses the trust of people, we face disruption through higher transaction costs, consumer defection and loss of our social license to operate.
Trust builds social capital
Beyond consumer relationships, trust builds social capital and invites cooperation throughout an organisation’s stakeholder ecosystem. This provides all partners with access to insights and the collaboration necessary to identify and mitigate risk, resolve negative externalities and design solutions that create shared value for business and society.
Good Shepherd Microfinance offers us a shining example of community, government and academia partnering to design the FIAP program, which enables corporations to facilitate financial inclusion among vulnerable consumer groups.
Enter, the Thriving Communities Partnership
The trust deficit is a central theme underpinning the Thriving Communities Partnership. We exist to restore trust in one another, as businesses, and to foster societal trust. Our charter of principles requires all of us to build trust with customers and communities by committing to fair and consistent treatment. We achieve this through conscious design of systems, processes and culture, promoting confidence and meaningful relationships..
“Above all, business can build trust by responding to the critical needs of society by leading change with positive community impact.”
To rebuild relationships of trust, we must first identify where and how trust has been eroded. To do this, we need to become genuinely empathetic to the needs of others, to understand expectations of us and to appreciate how our products, services and decisions impact people in their unique life context. We need to be consistent in our approach so that people can rely on us to act in their best interests, knowing that we exist to do good and not harm. Above all, businesses can build trust by responding to the critical needs of society by leading change with positive community impact.
Why wouldn’t we want to build a trustful society? Think about it – if trust is predicated on the belief and actuality of meeting the need of others, then we achieve solidarity as a society. With solidarity, everyone benefits – particularly the vulnerable, who should be able to rely on institutions to overcome barriers to social participation and prosperity. Trust is about realising harmony through the reconciliation of interests that promote mutual gain.
What are your thoughts on trust?