trust in business 2012 webcast slides final

Building Trust in Business

How Organizational Trust Impacts Performance

Need assistance? Call Member Services (866) 538-1909 or email

[email protected]

Today’s Featured Guests

Linda Stewart President & CEO

Interaction Associates

Andy Atkins Chief Innovation Officer Interaction Associates

@InteractionAsc

“Trust?” Why

3 © Interaction Associates Inc.

Poll Question

Does your organization measure employee engagement now? 1. Yes 2. No 3. Don’t know


Poll Question

Are you satisfied with the engagement survey results you are getting? 1. Yes 2. No 3. Don’t know


Survey Context 2009-2011


2.5

2.6

2.7

2.8

2.9

3

3.1

3.2

3.3

3.4

3.5

2009 2010 2011

Collaboration

Leadership

Trust

8

9

• Leaders got tactical • No peer-peer trust

10

• Lack of leader transparency • Peer-peer trust improves

11

TRUST

TARGET TALENT TEST

Poll Question What are the primary foundations for trusting others in your organization? 1. Past experience with the individual (TEST). 2. Observation of capability and performance

(TALENT). 3. Shared purpose and goals (TARGET).


Poll Question What of these describes the level of Trust in your organization?

1. Complete lack of trust. 2. More mistrust than trust. 3. Equal levels of trust and mistrust. 4. Fairly strong trust; little mistrust. 5. Extremely strong levels of trust.


Trust in Business Survey 2012


Survey Objectives

Most/Least important company goals or priorities

Effectiveness achieving business outcomes

Financial indicators

Leadership, trust-building, and collaborative behaviors

Level of trust

What is the organization’s “culture”

Environment for collaboration

Bases of trust

Factors contributing to collaborative effort failures

15

Survey Respondents 2012


Functional Area

Title

Number Employed in Organization

Less than 1,000 39%

1,000 - 4,999 21%

5,000 - 19,999 21%

20,000 or more 18%

Don't know 1%

Annual Gross Sales or Revenue

$100 million or less 30%

$101 million - $4.9 billion 33%

$5 billion - $14.9 billion 10%

$15 billion or higher 13%

Don’t know 14%

Industry

Business Professional Services 16%

Financial services/Real estate/Insurance

12%

Healthcare 12%

Public sector/Nonprofit 12%

Auto/Industrial/ Manufacturing 6%

Chemical/Energy/Utilities 6%

Hardware/Software/Networking 5%

Aerospace/Defense 3%

Other 28%


Survey Conclusions 2012


Shift in Business Priorities


2012 2009

Top line/revenue growth 42% Cost reduction/becoming more efficient 46%

Profit growth 38% Customer loyalty and retention 31%

Improvements to productivity and efficiency

29% Improvements to productivity and efficiency

27%

Customer loyalty and retention 26% Top line/revenue growth 27%

Business agility (speed, flexibility, adaptability to change)

26% Consistent execution of strategy 23%

Cost reduction/becoming more efficient 24% Business agility (speed, flexibility, adaptability to change)

22%

Attraction, deployment and development of talent

23% Competitive market position 22%

Consistent execution of strategy 19% Profit growth 21%

Innovation, creativity and entrepreneurship

17% Predictable business/financial results 17%

Exhibiting organizational behavior that is consistent with company values/ethics

13% Innovation, creativity and entrepreneurship

15%

Q1. TOP 10 BUSINESS GOALS OR PRIORITIES

Most Important Goals or Priorities


Dimensions of Success

3. Improvements to productivity and efficiency

1. Top Line Revenue Growth 2. Profit Growth


RESULTS

PROCESS RELATIONSHIP

Retention & Attraction of talent is a priority for high-performing companies.


2012 2009

Top line/revenue growth 42% Cost reduction/becoming more efficient 46%

Profit growth 38% Customer loyalty and retention 31%

Improvements to productivity and efficiency

29% Improvements to productivity and efficiency

27%

Customer loyalty and retention 26% Top line/revenue growth 27%

Business agility (speed, flexibility, adaptability to change)

26% Consistent execution of strategy 23%

Cost reduction/becoming more efficient 24% Business agility (speed, flexibility, adaptability to change)

22%

Attraction, deployment and development of talent

23% Competitive market position 22%

Consistent execution of strategy 19% Profit growth 21%

Innovation, creativity and entrepreneurship

17% Predictable business/financial results 17%

Exhibiting organizational behavior that is consistent with company values/ethics

13% Innovation, creativity and entrepreneurship

15%

Q1. TOP 10 BUSINESS GOALS OR PRIORITIES

Most Important Goals or Priorities


High Performing Companies


Growth Rate of Revenue Among High Performing Organizations

More than 10% above last year 48%

5-10% above last year 35%

Up to 5% above last year 13%

Flat (unchanged from last year) 3%

Negative (below last year) 1%

Revenue Growth Rate Net Profit

Above target 49% 54%

On target 40% 38%

Below target 11% 8%

"High Performing Organizations" are organizations whose net profit grew more than 5% over the last year.

High Performing Company Profile

"High Performing Organizations" had robust REVENUE growth.

Revenue and Profit Growth was above target for many High Performing Organizations


Low Performing Companies


Growth Rate of Revenue Among High Performing Organizations

More than 10% above last year 3%

5-10% above last year 9%

Up to 5% above last year 34%

Flat (unchanged from last year) 31%

Negative (below last year) 23%

Revenue Growth Rate Net Profit

Above target 13% 10%

On target 43% 45%

Below target 44% 45%

“Low Performing Organizations" are organizations whose net profit shrank or grew less than 5% over the last year.

Low Performing Company Profile

“Low Performing Organizations" had stagnant REVENUE growth.

Revenue and Profit Growth was below target for many Low Performing Organizations


High Performing Orgs vs.

Low Performing Orgs

High PG Low/No PG Gap

Q3_4 Customer loyalty and retention 66% 50% 16%

Q3_8 Competitive market position 59% 34% 25%

Q3_1 Top line/revenue growth 59% 28% 31%

Q3_2 Profit growth 57% 21% 36%

Q3_10 Predictable business/financial results 48% 34% 14%


29

High Performing Orgs vs. Low Performing Orgs COLLABORATION

• Being better practitioners of “people” or so-

called “soft” skills is the key differentiator for

High-Performing Orgs.

• These organizations have more of a shared

responsibility environment, and employees say

they have the skills needed to collaborate

successfully.

• Employees in High-Performing Orgs are open to

ideas of others.

30

High Performing Orgs vs. Low Performing Orgs LEADERSHIP

• Leaders in High Performing Orgs are realistically

optimistic and confident about the future.

• Leaders have specific and measurable goals linked to the

organization’s strategy.

• Leaders effectively communicate the mission, vision and

strategy of the organization

31

High Performing Orgs vs. Low Performing Orgs TRUST

• People feel safe communicating ideas and opinions

• People within the organization have a sense of

shared commitment and responsibility

• Individuals are not assigned "impossible" tasks that

are outside the scope of their knowledge/training

• Everyone is treated fairly, regardless of position or

rank

Disengaged Involved

15% of HPO Employees are Involved; 25% are Engaged

70% of LPO Employees are Disengaged or merely Satisfied

Organizational Cultural Continuum

Q11. Which of the following statements best describes your organization?

Our employees view their jobs as a means to a paycheck; if another opportunity came along, they would take it.

Our employees are satisfied with the company; they see it as a good place to work. Few would be motivated to seek another job.

Our employees are highly engaged and are committed to their profession and jobs; employees willingly expend discretionary effort to achieve results.

In addition to being highly engaged, our employees are actively involved and share responsibility for the organization’s success; managers provide meaningful opportunities for employees to give input and/or participate in decisions that affect them.


Degradation of Trust Compared to previous survey years, the levels of trust have deteriorated, with shared

commitment and responsibility and consistent efforts and actions decreasing significantly.

2012 2009 Gap

Q9_2 People feel safe communicating their ideas and opinions with colleagues/peers

52% 56% -4%

Q9_12 People within the organization have a sense of shared commitment and responsibility

45% 56% -11%

Q9_9 Individuals are not assigned “impossible” tasks that are outside the scope of their knowledge/training

43% 52% -9%

Q9_10 Everyone is treated fairly regardless of position or rank 43% 47% -4%

Q9_6 My peers are consistent and predictable in their efforts and actions

41% 51% -10%

Q9_4 The culture promotes and rewards honesty 40% 50% -10%


Degradation of Trust

2012 2009 Gap

Q9_7 The organization encourages transparency and shared understanding of key processes for decisions and initiatives

38% 46% -8%

Q9_11 People are acknowledged and rewarded for their work 38% 48% -10%

Q9_8 People in the organization share the rationale for their opinions

34% 43% -9%

Q9_1 People feel safe communicating their ideas and opinions with leadership

27% 37% -10%

Q9_5 Leadership is consistent, predictable and transparent in their decisions and actions

23% 37% -14%

Q9_3 People and teams can take risks (i.e. people are “allowed to fail” and learn from their mistakes)

21% 29% -8%

Biggest drop in Trust


* Fallback can be to any other level

Level of Involvement

Leve

l of

Ow

ne

rsh

ip

Gather Input from Individuals & Decide

Decide and

Announce

Gather Input from

Group & Decide

Consensus

Delegate with

Constraints


Levels of Involvement®

Need assistance? Call Member Services (866) 538-1909 or email

[email protected]

Questions?

Linda Stewart President & CEO

Interaction Associates

Andy Atkins Chief Innovation Officer Interaction Associates

@InteractionAsc

Full Report Available

May 14


Human Capital Institute (HCI) @human_capital

www.hci.org

Thank you!

trust in business 2012 webcast slides final

Business

targettesttalent trust

business goals

strong levels of trust

complete lack of trust

equal levels of trust

strong trust little

business agility speed

engagement survey