When we think of trust and what it means, we quickly realize it encompasses many things. Dig deeper into Trust Equation. Click below for more videos. Trust relationships are vital to the way we do business today.
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A former Harvard Business School professor, he originally specialized in logistics and transportation writing 8 books on those topics. He became the guru of Professional Services with his book Managing the Professional Services Firm after which he wrote 6 additional books on professional service firm topics. How has your view of trust changed, if at all, since then? As authors, consultants and teachers, we and others can help a lot with the knowledge and skill parts of understanding trust, and perhaps even through role playing and practice help people improve on the behavioral aspects — getting more skilled in conversations for example.
I am suspicious about whether the underlying attitudes or character traits necessary for trust are as common now as they have been in the past. This is not a comment on the inherent flaws of individuals. Rather, I think we have seen a generational change or two in the institutional context within which people have been raised. Customers and clients, through their increased reliance on purchasing departments, are signaling a lesser interest in buying through relationships.
The data is very clear — in the law for example, the single biggest means by which firms improved their profitability across the profession was de-equitizing existing partners and drastically reducing the numbers of people promoted to partner.
Accordingly, I think we are living in organizations which have low and declining trust and individuals are responding in kind. I think our economy and society has been training people to not trust.
CHG: For the record, what do you think is the role that trust plays in professional services—or for that matter in business as a whole?
DM : I remain as convinced as ever that a high-trust method of operation is the best high-profit, high growth strategy. However, it is sad to report that while these attributes where they existed could be shown to produce high profits and high growth, they were not common. Alas, in most businesses, neither the employees nor the clients can trust that managers will act in accordance with the principles they advocate.
So, cynicism and self-protection results. CHG: In your career, David, you consulted to or worked with a panorama of industries—law firms, accounting firms, advertising, actuaries, public relations, architects, consulting firms.
What did you find to be the most common trust issue across all of them? In the past, what made a professional service firm different from a general corporation was that it was built on some generally agreed if sometimes implicit assumptions. Assumptions that you could depend upon and trust that they would be observed. Under the old model, professional firms offered careers, not just jobs. Few entry-level hires according to the survey data I have seen expect to be with their firms 5 years hence.
The recent actions during the recession, wherein junior and admin staff were the first to be tossed overboard in the successful attempt to preserve partner incomes proved to everyone where the true priorities of most organizations lie.
Together with the fact that, in many professions, professional firms are increasingly publicly held, professional firms are in my view much more short-term focused than a decade or two ago. This breeds distrust inside the organization. No-one knows what rules or organizing principles if any can be depended upon. Shining counter-examples do exist the usual names but they are not the norm.
CHG: As long as we have that list in mind—is there one industry in particular that you found particularly better at—or more challenged, for that matter—at issues of trust? DM : In general, I find excellence at trust to exist at an individual level there are many incredibly admirable practitioners in every profession a very few firms that have firm-wide reputations for it, and no one profession or industry that has a consistently high reputation for being more trusted than other industries.
One profession — the law — does have a particular challenge with trust inside their own organizations. As I pointed out in a recent article, lawyers are professional skeptics: They are selected, trained, and hired to be pessimistic and to spot flaws. To protect their clients, they place the worst possible construction on the outcome of any idea or proposal, and on the motives, intentions, and likely behaviors of those they are dealing with.
Recently, I was advising a firm on its compensation system. Much current practice in firm governance, organization, and not least compensation comes from the fact that partners vigorously defend their rights to autonomy and individualism, well beyond what is common in other professions.
There is nothing inherently wrong with that. However, as major corporations consolidate their work among a smaller number of firms, domestically and internationally, they expect that firms will serve them with effective cross-office and cross-disciplinary teams. Firms are vigorously responding to this with a stampede of lateral hires, mergers, and acquisitions.
Their goal is to create big organizations offering many disciplines, locations, and cultures. The unanswered—actually, barely asked—question is whether these firms can shift from a managerial approach, based on partner autonomy, to new approaches that can create a well-coordinated set of team players. It is hard to unbundle which is the cause and which is the effect, but the combination of a desire for autonomy and high levels of skepticism make most law firms low-trust environments.
Continuing my less-than-hopeful theme, I have to report that as a recipient I do not experience much change or improvement, at least systematically, from those who try to serve me.
Do your readers? Nor do I see many game-changing approaches from new entrants in many professions that systematically increase trust between provider and client. Many professions are moving to fixed-fee pricing in part due to the historical lack of trust in the motives of providers who billed by the hour.
This COULD be a systematic way to increase intimacy and accessibility, but at least in Massachusetts it has not taken off in a big way. CHG : Your old industry of professional services; what did you find to be the most common failing—and did it by any chance have any connection with trust?
After all, it is superiority in those things that are screened for in doing well in college and, especially, in obtaining advanced degrees. However, few of us who went that route unless we had it from childhood were ever helped in developing our interactive, emotional people skills.
No one ever got their MBA because of superior empathetic skills. Few people, if any, had a successful law school career because of their predilection for being a team-player rather than focusing on their own accomplishments. People and firms underestimate how much effort and time it takes to develop such skills.
On which side do you think business needs more work? A little more trust does not get you a little less fee sensitivity or a little more repeat business. My own introduction to trust was by experiencing it — examples that we included in The Trusted Advisor book, and some that have happened since. Every so often, you come across someone — a dentist, an interior decorator, a financial advisor — who earns all your business and long-term loyalty by putting your interests first.
And when it happens, as it happened to me, you become an instant convert. DM : All of the lessons of trust in dealing with clients also apply, virtually un-translated, into building trust inside the organization.
Actually, I did try write about effective management and how trust applies. DM: So far, not at all. But it feels really great not to get on airplanes, and my wife and I, after treating Boston our home town as the place where for 25 years we did our laundry, are finding that surprise, surprise! Fill in the blanks with adjective s of your choice [apocalyptic; unprecedented; crisis; game-changer; etc.
While many might point to political or economic events that triggered similar feelings, the current outbreak of the novel coronavirus is touching every single […]. Over the weekend, walking with a few other adults in degree Holliston, Massachusetts, I observed a clear harbinger of spring Trust Matters Blog.
Your take on it? CHG : How do people come to learn about trust? How did you learn about it? Do you miss it? This is number 7 in the Trust Quotes series. Read previous post: Inflation Economics: the Tooth Fairy vs. Lemonade Stands Over the weekend, walking with a few other adults in degree Holliston, Massachusetts, I observed a clear harbinger of spring
The Trusted Advisor
The definition of trust is not clearly defined, weakening the writing effort. Still worth reading. The Trusted Advisor. David H. Maister , Charles H. Green , Robert M.
The Trusted Advisor [Paperback]
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The Trusted Advisor by David H. Maister
The definition of trust is not clearly defined, weakening the writing effort. Still worth reading. The Trusted Advisor. David H. Maister , Charles H. Green , Robert M. The essential "must have" tool for professionals who advise or negotiate with others in today's new economy.
Extremely useful if you do any kind of advice-work, like consulting, freelancing, or working on an agency. You don't get the change to employ advisory skills until you can get someone to trust you enough to share their problems with you. The way to be as rich as Bill Gates is to care more about writing code than about being rich. And the way to be a great advisor is to care about your client. A common trait of all these trusted advisor relationships is that the advisor places a higher value on maintaining and preserving the relationship itself than on the outcomes of the current transaction, financial or otherwise. Since clients are often anxious and uncertain, they are, above all, looking for someone who will provide reassurance, calm their fears, and inspire confidence. We should act as if we are trying to advise our mother or father.