Photo Credit Willie Holdman www.willieholdman.com
There is a compelling YouTube video called Did You Know? (you may want to turn down your speakers a little) that will stretch your thinking. Over 4 million views. At the end it asks: So what does it all mean? To us it means Trust matters more than ever. It reminds us why sparking a global renaissance of trust is such a critical imperative.
Twitter is remarkable. Follow us. I ignored it too long thinking it was not scalable or professionally relevant. My strategic business thinking is obviously sometimes my biggest handicap. I was wrong, it scales the entire globe. It is both personal, i keep up with kids and grandkids, and professional, I connect and communicate with like minded thinkers around the world. Short story first. A new friend on twitter Dinesh connected me to some wonderful TV footage on the Economist of an interview with Jaya Kumar, the Chief Marketing Officer of one of our clients, FritoLay, and Tony Hsieh, CEO of Zappos.com talking about trust, transparency, high trust culture and specifically the Speed of Trust. This is something that in the “old days” in the late 80’s early 90’s when we launched the 7 Habits book would have slipped through our fingers and not been shared with as broad and committed of an audience. This conversation would not have been transparent to me so that I could engage it, leverage it and share it. I also now have the opportunity and intend to acknowledge and thank Jaya for it.
Another new friend in Denmark gave me tips on what to see on my upcoming trip to Amsterdam. Another did the same in London.
The longer story that comes to mind is the significance of the realization of the transcendent potential of the world wide web so eloquently described by Christopher Locke at the turn of the century (the 21st century that is) in 2000 in his book the cluetrain manifesto:
“More important, all of us are finding our voices once again. Learning how to talk to one another. Slowly recovering from a near fatal brush with zombification after watching Night of the Living Sponsor reruns all of our lives. Inside, Outside, there’s a conversation going on today that wasn’t happening at all 5 years ago (95) and hasn’t been very much in evidence since the Industrial Revolution began. Now, spanning the planet via Internet and World Wide Web, this conversation is so vast, so multifaceted, that trying to figure what it is about is futile. It’s about a billion years of pent-up hopes and fears and dreams coded in serpentine double helixes, the collective flashback deja vu of our strange perplexing species. Something ancient, elemental, sacred, something very very funny that’s broken loose in the pipes and wires of the 21st century. There are millions of threads in this conversation, but at the beginning and end of each one is a human being… This fervid desire for the Web bespeaks a longing so intense that it can only be understood as spiritual. A longing indicates something is missing in our lives. What is missing is the sound of the human voice. The spiritual lure of the Web is the promise of the return of voice.“
Twitter is clearly a giant leap forward in that direction.
The Globe and Mail is considered Canada’s national paper with over 1 million readers. Stephen was interviewed by Sarah Boesveld last week and his remarks appeared in today’s Globe and Mail in an article entitled Ambiguity Anxiety. Stephen had this to say about the pressure on trust in the current crisis when managers are secretive: ”They tend to be done without very much openness, without very much transparency – people in rooms all day long behind closed doors. And when they emerge, managers dish out spin and don’t give employees the straight goods,” he says.
Our friend Matt Hutcheson, a global authority on 401k regulation who regularly testifies for congress, sent us this link today to a blog entry on Brightscope showing trust in organizations is only 12% as of December 2008. They call 2009 the year of Transparency in an articulate call for more light in financial regulation.
” . . . something important was destroyed in the last few months. It is an asset crucial to production, even if it is not made of bricks and mortar. This asset is TRUST. While trust is fundamental to all trade and investment, it is particularly important in financial markets, where people depart with their money in exchange for promises. To study how recent events have undermined Americans’ trust in the stock markets and institutions in general, we have launched the Chicago Booth/Kellogg School Financial Trust Index.”
The Kellogg Financial Trust Index called trust:
“Something important was destroyed in the last few months. It is an asset crucial to production, even if it is not made of bricks and mortar. While this asset does not enter standard national account statistics or standard economic models, it is so crucial to development that its absence — according to Nobel laureate Kenneth Arrow — is the cause of much of the economic backwardness in the world. This asset is TRUST. As stressed by Arrow: “Virtually every commercial transaction has within itself an element of trust, certainly any transaction conducted over a period of time.” Without trust, cooperation breaks down, financing breaks down and investment stops. One can bomb a country back to the Stone Age, destroy much of its human capital, and eliminate its political institution. But, if trust persists, the country may be able to right itself in just a few years, as in Germany and Japan after World War II. Conversely, you can endow a country with all the greatest natural resources but, if there is no trust, there is no progress.”
We could not agree more. We must all step up and behave in ways that inspire trust if we are to hope to turn the tide any time soon. The tide will turn and this dramatic correction will shock us into taking trust more seriously much like 9/11 sparked a national sense of patriotism. Let’s hope our paradigm shift of awareness sparks a behavior shift that is sustainable.
Federal Reserve Chairman Ben Bernanke said Sunday in a rare television interview that fear is one of the biggest challenges remaining to restart the US. Economy. Duh! This interview is a conscious effort on the part of the US Fed to become more transparent and restore trust. Restoring trust again is seen as the recipe to hope. Restoring trust on the corporate or individual level requires the same deliberate effort. The good news is confidence is building and will continue to grow slowly as leaders continue to behave in ways to restore trust as Bernanke did by just taking this interview.
What equivalent gesture might you make to restore trust in your team, organization or relationship?
Emile Durkheim once said, “when mores are sufficient laws are unnecessary, when mores are insufficient laws are unenforceable.” Our financial regulators could learn from this premise. The transparency of the web creates the possibility of self regulation Durkheim envisioned. Ebay pioneered this self regualation that enabled as, founder Peter Omidyar said “that the miracle of Ebay was that 135 million strangers could trust each other”. A brilliant article in Wired Magazine Road Map for Financial Recovery: Radical Transparency Now! By Daniel Roth 
02.23.09 lays out a very doable solution for our financial train wreck:
”That’s why it’s not enough to simply give the SEC—or any of its sister regulators—more authority; we need to rethink our entire philosophy of regulation. Instead of assigning oversight responsibility to a finite group of bureaucrats, we should enable every investor to act as a citizen-regulator. We should tap into the massive parallel processing power of people around the world by giving everyone the tools to track, analyze, and publicize financial machinations. The result would be a wave of decentralized innovation that can keep pace with Wall Street and allow the market to regulate itself—naturally punishing companies and investments that don’t measure up—more efficiently than the regulators ever could.
The revolution will be powered by data, which should be unshackled from the pages of regulatory filings and made more flexible and useful. We must require public companies and all financial firms to report more granular data online—and in real time, not just quarterly—uniformly tagged and exportable into any spreadsheet, database, widget, or Web page. The era of sunlight has to give way to the era of pixelization; only when we give everyone the tools to see each point of data will the picture become clear. Just as epidemiologists crunch massive data sets to predict disease outbreaks, so will investors parse the trove of publicly available financial information to foresee the next economic disasters and opportunities.”
This is an idea whose time has come. The sunlight of transparency is the ultimate accountability. What information in your team or organization would improve accountability?
Are you more suspicious? Who can you count on?
We all are sitting straight up right now and have a high level of suspicion of others especially as it comes to our money. I was just listening to Tom Brokaw’s commencement address to Emory University from 2005. He said this about money to these graduating seniors as they started their new life: “In this new life you will also have to think about money in a new way, life after all is not an ATM, now you have to earn the money. Think about how you can hang on to some of it, and if you are fortunate, use the money that is beyond what you need, to save a life, to save a neighborhood, to save the world. You may be surprised to learn that it is that use of money, that is the most satisfying and gratifying. In our family where we began with no money, we like to say that we have discovered that God invented money so those that have it can help others. More over while money helps, it is discounted somehow if it does not carry your full personal value and commitment. A few years ago in a ceremony similar to this one, I declared: ‘it is easy to make a buck but it is tough to make a difference.’ A father of one of the graduates, a Wall Street success wrote to me suggesting a rewrite of that line, he said it’s tough to make a buck but if you make a lot of bucks you can make a hell of a difference. A or B because there is no wrong answer.” Tom went on to tell this, “Class of 9/11″ as he called them (because they entered college the month of 9/11) that they had a responsibility to rise to the occasion to right the global ship of state.
Now is the time to have a propensity to trust each other and risk again. Now is the time to give to others and have an abundance mentality, when everything in us and around us, screams for us to have a fear based scarcity mentality. Now is the time to use our time, not for worry, but for lifting others with our time and our treasure as history tells us we have again and again. Trust that the ripple effect of extending trust will create a tide that will raise all of us–again.
This brings to mind a quote from George Bernard Shaw that my wife Annie and I love so much. We first heard it from Werner Erhard in the 70’s and Annie shared it with Stephen R. Covey who quoted it in the 7 Habits of Highly Effective People. It sums up my feeling today as it has these last three decades. We invite you to join us in sparking a global renaissance of trust.
George Bernard Shaw:
“This is the true joy in life–that being used for a purpose recognized by yourself as a mighty one. That being a force of nature, instead of a feverish, selfish little clod of ailments and grievances complaining that the world will not devote itself to making you happy. I am of the opinion that my life belongs to the whole community and as long as I live it is my privilege to do for it what ever I can. I want to be thoroughly used up when I die. For the harder I work the more I live. I rejoice in life for its own sake. Life is no brief candle to me. It’s sort of a splendid torch which I’ve got to hold up for the moment and I want to make it burn as brightly as possible before handing it on to future generations.”
May we all be a force of nature.
“By virtue of its immensity, the global effort to restore trust will… almost certainly succeed.” Business WeekJames C. Cooper, Senior Editor and Economist, for BusinessWeek actually said this in an article in BusinessWeek last October but it rings with new hope in light of the unprecedented stimulus package signed in my home town of Denver today. The Stimulus package violates my sense of the free market principles but may be better than the alternative of letting market forces bankrupt miss guided companies as it would in a normal market. It is a slippery slope, however. The medicine may prove to be worse than the illness. Not holding organizations and individuals accountable for their actions is a clear violation of market trust. James Cooper clearly described the problem: “Individual governments are rapidly filling in the details as they move unilaterally to address their own needs, but with the common purpose of attacking the broader problem of eroding confidence in the financial system. Modern finance, in which a relatively small base of capital supports a much larger volume of credit, depends on three things: sufficient capital among banks, liquidity to keep funds flowing, and trust that everyone will get paid. The problem with this financial trinity is that trust is not only dependent on the first two, but also turns on human emotion. Too much fear can bring down the house. By virtue of its immensity, the global effort to restore trust will almost certainly succeed.”
I remain optimistic that keeping a cool head and having a propensity to trust the free market system will ultimately right the global economy. We each have to do our part to restore confidence by behaving in ways that inspire trust. We also must spend and invest and act as if we believe in the system. I have confidence that just like the savings and loan crisis, the dot com bubble, 9/11, and numerous other market disruptions in recent history, that the economy will recover more quickly than the press would have us believe but only if we each step up in our own circle of influence and restore trust and confidence.
Previously I mentioned that I was reading Jeff Jarvis’ new book What Would Google Do? I was just struck by his comments on market trust: “Leaders in government, news media, corporations, and universities think they and their institutions can own trust when, of course, trust is given to them. Trust is earned with difficulty and lost with ease….Trust is an act of opening up; it’s a mutual relationship of transparency and sharing. The more ways you find to reveal yourself and listen to others, the more you will build trust, which is your brand.” We of course, agree whole heartedly. Jeff does an excellent job of giving us a glimpse of the implications of violating trust in a post google transparent world. His experience with Dell is worth the price of the book alone. How we behave in this financial crisis will effect our credibility, reputation and brand for years to come. Are you behaving in ways that inspire the trust of your stakeholders, especially your customers?
I will resist the almost overwhelming temptation to quote Jeff further and will instead, again, strongly urge you to read this book right away. In times of trouble we need to challenge ourselves to get better and to reframe our thinking. Jeff provokes new thinking that I believe, regardless of your profession or industry, will either excite you about the possibilities of the future or scare you enough to confront reality and change your expectations. You know I read a lot of business books so I have a somewhat informed judgement. I predict that this is another Tipping Point and as such will top the business lists for years to come.
Today in his inaugural address President Obama emphasized trust: “Those of us who manage the public’s dollars will be held to account—to spend wisely, reform bad habits, and do our business in the light of day—because only then can we restore the vital trust between a people and their government.” Let’s hope that he can live up to that ideal. To overcome decades of a control based culture in the US Federal government is going to take intense effort. Restoring trust is mission critical to the entire global economy on many levels right now. We are fighting to fuel a global renaissance of trust or as Obama stated to “do our business in the light of day.”
Malcolm Gladwell has done it again. His new book Outliers is well worth the read and is already #9 of all books on the USA Today bestseller list. Outliers brilliantly challenges our assumptions about success. It makes my short list of stimulating reads about success. It is extraordinary for a growing a global perspective by learning new insights about success in other cultures. Gladwell again comes up with stimulating and surprising examples that are thought provoking and help develop our lateral thinking. It is a great book to inspire us to get better and rethink our level of play and effort. I was particularly moved by the concept that it takes 10,000 hours to master success and that hard work can overcome other disadvantages. Another unlikely insight I gained was about educating my grandchildren and helping them step up to the future. Well done Malcolm.
The European Weekly in an article entitled The 2007-2008 crisis – a breakdown of trust?
| By Peter Gakunu, the IMF Executive Director for Africa, and a member of the Jury of the Robin Cosgrove Prize for Ethics in Finance, called the global financial crisis a breach of the public Trust. |
In his first global interview since being elected, President Elect Obama told 60 minutes Sunday night: “We actually have a consensus among conservative leaning economists and liberal left leaning economists and the consensus is this that we have to do whatever it takes to get this economy moving again.”
I was encouraged to hear his recognition of trust as a core element to restore our global economy. Obama said:
“A top priority we have to restore a sense of Trust, transparency and openness in our financial system. Keep in mind the deregulation process, it wasn’t just one party I think there is a lot of blame to spread around.”
(You will remember a post last month where I quoted British Prime Minister Gordon Brown’s comments on CNN: “The most precious asset of all is something that if lost, can only be restored not by words, but by actions, that is the asset of Trust and confidence “ ) Glad Obama and Brown both seem to get it.
I also resonate with his statement of bipartisan responsibility for the problem. Obama continued:
“Our basic principle that this is a free market system and that it has worked for us that it creates innovation and risk taking is a principle we need to hold to as well. But what I don’t want to do is get bottled up in a lot of ideology, is this conservative or liberal, my interest is finding something that works and whether its coming from FDR or from Ronald Reagan if the idea is right for the times we are going to apply it.”
I applaud his assertion that the best idea wins. This alone can transform our leadership. As an American It has been embarrassing to watch our Congress and Senate under Bush and Clinton, bicker instead of influence and lead. The world is losing respect for our democratic free market system because of our poor example.
As Obama went on:
“I want to make sure that I can recreate a bond of trust between the Presidency and the public that I think has been lost.”
Finally he again appealed for synergy:
“There were a number of reasons that someone would not have voted for me, but what was absolutely clear was whether people voted for me or against me they were making the judgment based on, is this guy gonna lead us well. Is this guy going to be a good president.”
We all must behave our way out of the problems we have created in the economy by behaving with each other in ways that inspire trust. Our leaders can only be as good as the people they lead. Now that the election is over we must sustain our leaders. Let’s all take responsibility to rise to the occasion to be credible and act to inspire others in moments of trust to fuel a ripple effect for a global renaissance of trust.
(CBS News)” In an extraordinary moment in America’s history, Democratic presidential nominee Barack Obama has won the 2008 presidential election and will become the 44th president of the United States and the country’s first African-American leader. ”
I resonate with the possibilities President Elect Obama represents and congratulate him on his historic victory. We challenge all to sustain our new leader and rise to the occasion to restore trust in ourselves and each other. This new Presidency offers us all a microcosm to observe the workings of a change of leadership. The same principles and challenges face new leaders in schools, companies and even the corner store. Let us all have a propensity to trust in our leadership.
Obama said it best: “If there is anyone out there who still doubts that America is a place where all things are possible, who still wonders if the dream of our founders is alive in our time, who still questions the power of our democracy, tonight is your answer,” he added.
“A new dawn of American leadership is at hand,” Obama said.
He pledged:
“Let us resist the temptation to fall back on the same partisanship and pettiness and immaturity that has poisoned our politics for so long. Let us remember that it was a man from this state (Lincoln) who first carried the banner of the Republican Party to the White House – a party founded on the values of self-reliance, individual liberty, and national unity. Those are values we all share, and while the Democratic Party has won a great victory tonight, we do so with a measure of humility and determination to heal the divides that have held back our progress. As Lincoln said to a nation far more divided than ours, “We are not enemies, but friends…though passion may have strained it must not break our bonds of affection.” And to those Americans whose support I have yet to earn – I may not have won your vote, but I hear your voices, I need your help, and I will be your President too.”
Today’s USA TODAY Thursday November 13th
In an section call THE FORUM
Cal Thomas a conservative columnist and Bob Beckel a liberal democratic strategist as longtime friends often can find common ground on issues that lawmakers in Washington cannot. Today’s biweekly series they entitled:
Bob: “He talks a good game but what’s he look like on the court? That’s essentially what the commentariat are asking when it comes to President Elect Barak Obama. He’s been the poster [child] for common ground, yet there is much hand-wringing about whether he’ll veer left. Anyone who thinks he’ll do so while ignoring the Republicans hasn’t been paying attention. Even the week before the election, Obama campaigned almost completely on the common ground theme with which he began his run for the White House. His eloquent speech in Grant Park in Chicago on election night was vintage bridge-building.”
Cal: ” As an American first, I sincerely hope you are right. It isn’t often I agree with Senate Majority Leader Harry Reid–in fact, I can’t think of a single time–but I wholeheartedly endorse his summation of the main message from this election. “This is a mandate to get along, to get something done in a bipartisan way. This is not a mandate for a political party or ideology.” (more…)
Take 2 one of England’s leading online booksellers today announced that The Speed of Trust was the #7 Bestselling book in Britain last week!
Klaus Schwab, Chairman and Founder, World Economic Forum had this to say “The Speed of Trust… is even more relevant in the world we have seen evolving over the last months. Congratulations and thank you!”
Stephen and I really relate to this as we are not the most tech savvy members of our team. Thank you Steve Jobs for giving us a fighting chance with our iPhones and MacBooks.
Mellisa Long & Stephen M. R. Covey
Stephen M.R. Covey talks about what role trust plays in business and relationships. Stephen was interviewed by Mellissa Long on CNN about trust in themarketplace.
“The most precious asset of all is something that if lost, can only be
restored not by words, but by actions, that is the asset of Trust and
confidence “ British Prime Minister Gordon Brown CNN Oct 13th 2008
As I see it, the ultimate value of the Social Networks is still up for grabs even though it is growing worldwide. The potential fatal flaw is that rather than enhancing your reputation you may damage it by loosely giving access to your most trusted relationships. Consider this: Do you have a multiple year, deep trusted relationship with your social network friends or a 1 year acquaintance repeated multiple times? With Trust depth matters.
Social networks are filled with loose mutual acquaintances but rarely our most trusted influencers. Why? Because it would violate the very level of trust the relationship is based on to openly expose your most influential high trust relationships to random access from others you barely know! This is the same reason customers are reluctant to risk their reputation by referring their trusted colleagues and friends to salespeople. The speed of your trust and reputation, your social capital and influence, resides in your carefully nurtured “Trustwork”™ not your loose network of acquaintances. Mix the two haphazardly and you risk your reputation with your most trusted friends. Many of the acquaintances in your social networks, are simply “potential” candidates for you to up-level and earn deep mutual respect with, and they with you, by demonstrating consistent behavior over time that inspires each person’s trust. Facebook, Linkedin and others provide a rich opportunity to meet new friends trusted by people you trust. This is the ultimate value of networking. In fact research shows that loose acquaintances were more likely to lead to a job referral. So social networks do have value. Just be sure to extend smart trust and check new friends track records before introducing them to your Trustwork™ of long nurtured high trust relationships until they earn that extraordinary level of trust.
The game of friending anyone and everyone to show a large network number also seems risky. Clarify your expectations and think of how you would like others to access you. Build your network strategically based on your objectives. The intent of the network providers is to attract eyeballs and mindshare any way they can and find ways to monetize that attention. The jury is still out on how they will do that. Meanwhile, we are trusting them with considerable information so be smart out there.
Yang Yuanqing
Stephen was pleased to speak again to Yang Yuanqing, Chairman of the Board of Lenovo. Lenovo is rapidly becoming a major global brand after acquiring the IBM PC and as the one of the lead sponsors of the 2008 Beijing Olympics. This merger was one of the most visable multinational mergers between a Chinese and a U. S. firm. Stephen first met Yang Yuanqing when Stephen led a global executive team 2 day meeting for Lenovo last year. They have an impressive collection of talent and an excellent product and are poised to be a powerful force in their industry. Of note is the decision that Lenovo made to drop IBM from their product branding long before their rights to use the IBM name expired in their contract. This was a bold vote of confidence in their global brand and reputation. Well done!
Yang Yuanqing is a local rock star of business much as Steve Jobs and Bill Gates are in the U.S. He was mobbed by dozens of press and TV cameras as he left the stage. Stephen managed to speak to him for several minutes. Yang was genuinely pleased to see Stephen again. We gave him as set of the Speed of Trust 13 behavior cards translated into Chinese.
QQ.com is the #1 internet portal in China reaching over 90% of all web users in China with over 273 million active accounts. That is nearly the entire population of the U.S. or Europe both children and adults! In a lengthy interview Stephen and I were struck by the similarities of the questions and the high level of interest in the topic of Trust consistent with what we experience in other countries. There was no sense of caution as the interviewer pointed out the low levels of trust that still exist in China between the government and business. The Speed of Trust is published in both simple and Complex Chinese and is selling well.
Stephen emphasized the common ground of the topic of trust in relationships with team members from various nations. He pointed out that the 13 behaviors of high trust leaders are common to leaders around the globe regardless of nationality. There was significant interest in Stephen’s assertion that trust many times can be restored or to a great degree improved after it is broken. It is not black and white. This resonated as a hopeful concept for China as they tend to consider dire consequences to loosing face or damaging your family or business reputation. Stephen also discussed the gains in market trust and brand reputation gained by China due to their hosting the Olympics. The national pride in China fueled by the Olympics and rising economics is evident in conversations with local leaders.
Stephen and I attended The World Economic Forum in Tianjin, China. Stephen presented the Speed of Trust and participated on several panels. At the close of the World Economic Forum’s “summer Davos” we participated in a general table discussion on the topic of what are the top challenges facing organizations in the coming year. Each table of the 2000 plus participants identified one issue and then using keypad voting every one voted to force rank the top issues (now keep in mind this was taking place the weekend that the US congress and Senate were working on a rescue program). We were all surprised that the global financial crisis was voted #2. The #1 challenge was a crisis of Trust and Confidence. The consensus was that the impact of the financial crisis is exasperated as trust declines. The financial crisis at is root is a trust crisis. Especially because it involves credit and everyone is afraid to part with their cash and are rightfully reluctant to risk because they do not know who they can trust given the downfall of several hundred year old institutions. Think about it—credit is trust and trust is credit.
On the weekend that the U.S. Congress and Senate were debating a financial package Stephen and I attended a BBC televised debate from the World Economic Forum on the impact that the economic crisis would have on China. It was fascinating. The woman pictured was from Taiwan, others were from Mainland China and Western firms. Consensus was that China has not yet gotten involved in the financial industries like the west. Their economy is still growing in the more stable and traditional industries of manufacturing, agriculture and real estate. They are also cash rich and actually may benefit by buying Western assets for low prices. The ultimate threat is lack of demand for their exports if other economies loose buying power.
Stephen had an engaging in interview this morning on CNBC China that is broadcast nationwide and is considered one of the leading sources of business news in Asia. He was interviewed by David Arkless a distinguished member of the Board of Directors of Manpower, a $20 billion global conglomerate. In an engaging discussion Stephen discussed the core impact of Trust on business relationships across national lines. He pointed out that in his presentations in over 30 countries on The Speed of Trust business and government leaders resonated with the relevance of trust to their current business strategies and objectives. Trust neutralizes nationality and gender focusing on the track record and credibility of the person and not other factors. We trust people that come through for us. Trust is a universal principle that applies to all human nature and cultures even though it may be expressed locally in different ways and practices. In China, as in all of Asia the practice of saving face is an example of preserving your trusted reputation.
This very articulate woman from Pakistan made a powerful case for the underrepresentation of women in leadership through out the world and even on the panels of the World Economic Forum. I attempted to speak to her but the press of the nearly 2000 people in the room prevented me from getting to her. I also have searched the photo album of participants to find her name but was unable to find her. If you know her, email me.
I resonated with her straight talk in respectfully confronting the forum about this unfortunate reality in business and government. I am a staunch advocate for women in leadership and have a bias that they have traits of intuition, vision, and empathy lacking, or at least way underdeveloped, in many of their male counterparts. It has also been my experience that women are more influential in negotiating. This is the purest evidence for their case as a disproportionate number of women excel in sales which is the ultimate level playing field with no ceiling, glass or otherwise. Trust is an extraordinary gender neutralizer. We trust people based on their integrity, performance and behavior regardless of gender or ethnicity.
“Politics” – the antithesis of trust and standard operating procedure for many industries, governments, organizations, and relationships. In today’s world, everyone is a politician, trying to get ahead, but it is an illusion, spin. Add to that the very real consequences of stop-loss measures like bailouts, leaving what many media outlets call a “crisis of confidence.” We call this a crisis of trust.
A recent BBB-Gallop poll indicates a 24% decrease in trust of business during the past year. This was before the current financial crisis. Steven Cole, President and CEO, National Council of Better Business Bureaus, asserts, “The continuing decline of consumer trust is just not sustainable for businesses, but, interestingly, the issue highlights a clear opportunity for competitive advantage among businesses that embrace consumer demand for trust in the marketplace.”
The fastest way to get the US economy back on track: rebuild and restore trust, in every industry, every organization, every government, and every relationship. Seventy-two percent (72%) of those surveyed in the BBB-Gallop poll say it’s as simple as businesses “doing a better job delivering on their promises.”
The numerous endorsements by CEOs in The Speed of Trust obviously indicate the appeal to executives, but the real proof is that organizations around the world are embracing The Speed of Trust by having it presented to their most important audiences.
Proving the economic case for trust and demonstrating that it can be measured AND that the needle can be moved is what engages the executives. This topic resonates!
Trust is a mission-critical competitive advantage in the new global economy, and the good news is that it can be dramatically increased by learning 13 behaviors common to all high trust leaders around the world.
Trust is being spotlighted on the global stage; Stephen and I are currently en route for him to present The Speed of Trust to 1,500 leaders from over 60 countries at the World Economic Forum. in Tianjin, People’s Republic of China, September 27-29, 2008. The China forum is a meeting for what are termed “Global Growth Companies.” This second “Summer Davos” will bring together the emerging multinational companies – the New Champions – that have the potential to reshape the global economic landscape. Under the theme “The Next Wave of Growth,” CEOs of the New Champions will engage with a diverse group of the most important players shaping the future of business and the global agenda.
Stephen M. R. Covey has recently been invited to present The Speed of Trust to the World Economic Forum in China September 27th. The China forum is dubbed “summer Davos” and is a meeting for what are termed “Global Growth Companies”. Stephen said “ It is such and honor to address this group of influencial world leaders who’s motto is entrepreneurship in the global public interest’. They believe that economic progress without social development is not sustainable, while social development without economic progress is not feasible. I agree.”
The forum will be hosted in Tianjin, China just 90 minutes east of Beijing and across the bay from Dalian the site of last years forum.
The World Economic Forum’s Community of Global Growth Companies forum was created to recognize the next generation of industry leaders. It supports them as they navigate the challenges of new geographies, markets, cultures and regulatory systems as they become a major driving force in social and economic development.
The World Economic Forum’s Community of Global Growth Companies consists of companies that:
Stephen and I will join CEO’s and senior executives from the world’s leading organizations including Nokia, Deloitte Touche Tomatsu, Duetsche Bank, Peking University, KPMG, Infosys, Swisscom, Chevron, Dabur India, Harvard, Best Buy, Burger King, Volvo and journalists from CNN, The Financial Times, China Daily, New York Times, Time magazine and many others. This is a meeting that will make the ultimate ripple effect of influence and we are privileged to be invited to address them.
Stephen just returned from Asia and reports that The Speed of Trust continues to be well received – from Australia to Singapore. Crowds there were very responsive to the concept that trust is a competency that can be learned and taught. They see trust as a competitive advantage. Audiences were particularly enamored with the new DVD vignettes from the Leading at the Speed of Trust training course.
Our close friend and colleague Joseph Grenny co-author of the New York Times best seller Crucial Conversations sent us this interesting snapshot into international trust printed in the Economist this week. It highlights the foundational bedrock of Trust in business. Business, whether B2B or with consumers demands a propensity to trust each others intentions. IF that presumption of Trust is violated consistently and a propensity to be suspicious prevails it could grind our global economy to a halt. The articles points out an interesting fact. That there are actually less lawyers in the business sector in Japan, perhaps signaling a higher propensity to trust. The speed of growth that economies around the world are enjoying seems to be evidence that trust is again growing. This story is a cautionary tale however, if we violate trust with each other in business our global economy could quickly shift from speed to friction.
The article contrasts the propensity to trust in the Japan compared to the west. ”In the West, that culture is increasingly one of implicit mistrust. Deals require armies of lawyers and thick paper trails to give parties confidence, in spite of the time and money that such work entails. In Japan, by contrast, companies—some dating back centuries—regularly deal with long-standing partners; reputational concerns, rather than strictly legal ones, are paramount.”
Japanese finance
My bow is my bond
Apr 24th 2008 | TOKYO
From The Economist print edition
A wicked swindle exploits a soft spot in Japan’s business culture
TRUST is the bedrock of business everywhere, but the sources from which it springs are different. In Japan, where reputation and relationships are considered precious, the informal cues are as important as the legalistic ones. Parties take their time discussing deals. Managers meet to exchange meishi—their all-important business cards (usually presented with two hands)—and bow respectfully. It helps to establish confidence.
So it was that when a handful of bankers from Lehman Brothers met executives of Marubeni, one of Japan’s largest trading houses, at Marubeni’s headquarters across from the Imperial Palace last autumn, they never suspected that they were actually being drawn into a massive fraud. The teams had met numerous times to discuss a bridge loan. Reams of paperwork were supplied. In a convoluted agreement, Lehman provided more than $350m in financing to a small firm with ties to Marubeni (and founded by a cousin of the empress of Japan); the trading house guaranteed repayment.
Or did it? When Lehman contacted Marubeni after a payment was missed, Marubeni said that it had no idea what the bank was talking about. Marubeni has claimed that contracts signed and stamped by a Marubeni director were found to be forgeries and the manager whom Lehman’s bankers met in Marubeni’s offices was an impostor. Marubeni says the two employees who negotiated the deal were fired. Marubeni refuses to repay the money, claiming it is a victim of fraud itself. On March 31st Lehman sued Marubeni for $350m. Since the fraud was uncovered, more alleged victims have surfaced, such as Och-Ziff, an American private-equity firm, which is owed around $80m.
The case pits a company’s responsibility to supervise itself against the adequacy of the due diligence that investors must perform. The Japanese legal doctrine of “apparent authority” holds firms accountable for their employees’ actions, provided those actions are carried out within the scope of their normal work. Meanwhile, Lehman’s checks will come under scrutiny, not least by its own insurance company. Yet also on trial will be Japan’s business culture—and what constitutes trust in the world of finance.
In the West, that culture is increasingly one of implicit mistrust. Deals require armies of lawyers and thick paper trails to give parties confidence, in spite of the time and money that such work entails. In Japan, by contrast, companies—some dating back centuries—regularly deal with long-standing partners; reputational concerns, rather than strictly legal ones, are paramount. Business disputes rarely go to trial. The number of corporate lawyers is extremely low compared with other financial centres, and frauds by one party against another are exceedingly rare.
So when Lehman met Marubeni employees at the trading house’s offices, there was no reason to suspect anything was amiss. Many consider such a culture to be very beneficial to Japan. Yet the closer that Japan’s financial practices are to global standards, the more the informal ties of trust will be replaced with formal legal ones. Something will be gained, but something will be lost as well.
As Jerry Roper CEO of the Chicago Chamber of commerce said last year: ”The Speed of Trust is not a book it is a movement.” We hope so. Stephen and I are thrilled at the tremendous reception The Speed of Trust is receiving from all corners of the Globe. We are convinced and passionate about the prospects of sparking a Global Renaissance of Trust. Momentum is building, keep telling your friends. Be an advocate of Trust.
Stephen speaks in these 13 Global Cities in the next few weeks:
In Australasia:
In Europe:
In South America:
The Speed of Trust continues to sell strongly in the USA, remaining on the New York Times’ list for the last 12 weeks. The Speed of Trust was #12 of all books in USA Today on February 14th and #1 in The Wall Street Journal business books on February 15th. It is #13 on the New York Times’ list for this Sunday. It was also the #1 best-selling book for the entire year of 2007 by CEO-Read.
The Speed of Trust continues to gain momentum around the world in our quest to be a catalyst for a global renaissance of Trust. It was #5 on Canada’s respected Financial Times’ bestseller list over Easter weekend.
When the going gets tough, projects, money, and jobs gravitate to trusted high performers. The Speed of Trust teaches 13 behaviors common to high trust people and leaders throughout the world. The last to be laid-off or outsourced are those “go to” performers that are trusted.
As Chris Anderson, author of The Long Tail and Editor-in-Chief of WIRED magazine, stated in his interview with Stephen M. R. Covey on The Speed of Trust: “Money was the currency of the old economy; Trust is the currency of the new, global economy.” Stephen M. R. Covey is fast becoming the global CEO of Trust. Stephen will be speaking in Singapore, Hong Kong, and several other Asian cities in late May.
Our new iPhone
In late April Stephen spoke to the executive team of the U.S. Navy led by Mike Mullen Chief of Naval Operations which included all U.S. Navy Admirals and Senior Leaders at their annual leadership conference in Annapolis, Maryland.
In a current article entitled “Sailors building trust, one person at a time” published in The Hill, Admiral Mike Mullen, Chief of Naval Operations, had this to say about trust, Stephen M. R. Covey, and military service on this past Memorial Day:
“In the Navy, it’s a big part of who we are. It’s what we do. Trust is what we offered our friends and allies in the Arabian Gulf when we sent a second aircraft carrier there… Trust is what we share when we tell our brothers and sisters in the Army and Marine Corps that we are going to pitch-in and help them out on the ground, and then we do it… Trust is a Corpsman racing to a fallen comrade… Trust is the engine that literally runs the global maritime partnerships of the ‘1,000-ship Navy’… As Stephen M. R. Covey put it in his new book, The Speed of Trust, ‘When you build trust with one, you build trust with many.’… That’s exactly what your Sailors, Marines, Soldiers, Airmen, and Coast Guardsmen are out there doing every day on your behalf… On this Memorial Day, as we pause to remember those who sacrificed their lives for this country. I hope we also pause to remember the sacrifices our service members are making as they build trust with millions of people around the world, one person at a time.”
We are honored to have these fine people join us in our attempt to spark a global renaissance of Trust.
Stephen’s hot new book and keynote, The Speed of Trust, continues to inspire association audiences and fuel requests for his call for a global renaissance of trust.
He is in demand worldwide with associations from all sectors including:
-American Dental Association 2007 National conference,
-The Institute of Internal Auditors National conference,
-The Information Technology and Internal Auditors National conference,
-The ASAE & The Center CEO Thought Leaders Conference,
-The Software and Information Industry Association National conference, and
-Several Healthcare Associations in the U.S. and Canada.
Many others are embracing his fresh and relevant message. Global demand is growing. In March this year, he keynoted leadership conferences in Asia and Europe and is headlining conferences in London in June, India in July, and China in September.
Why the significant demand by associations? Hugh K. Lee, President of Fusion productions and host with Disney Institute of the Digital NOW conference this month, had this to say when asked why he invited Covey to keynote his conference: “New global networks, new ways of doing business, and new ways of gaining knowledge have placed a premium value and penalty on the presence or lack of trust. Nowhere in our society is it more critical to gain and maintain trust than in our associations. Every sector of our economy, every profession that we are employed in, and the vast majority of knowledge, research, standards, and guidelines that we live by are produced by associations today. That’s why we chose to have Steven M. R. Covey speak at DigitalNow; it is essential that we all understand the impact of trust and make it a priority. Mr. Covey’s research and knowledge are critical to achieving this goal.”
William Parrett, CEO of Deloite Touch Tomatsu, sure was prophetic when he called The Speed of Trust “red-hot relevant” last year.
The SPEED of Trust is a paradigm-shifting topic that challenges our age-old assumptions that trust is merely a soft, social virtue and instead demonstrates that trust is a hard-edged economic driver—a learnable and measurable skill that makes organizations more profitable, people more promotable, and relationships more energizing.
The Speed of Trust was selected by Business Week as one of the 5 top career books for 2006 and is already in its 6th printing in the US and is being translated into all major languages around the world.
Lastly, Elliott Masie, CEO of The Learning CONSORTIUM, describes why he had Covey keynote his 2006 annual event: “In a ‘flatter’ world, trust is the ’secret sauce’ that significantly enhances learning, relationships, and results. Covey’s breakthrough insight that trust is a competency is both revolutionary and immediately practical. CEOs and Chief Learning Officers will embrace The Speed of Trust as an authentic and actionable strategy–a roadmap–for increasing the effectiveness of their organizations and leaders.”
“The one thing that can change everything in our personal and professional lives in 2007 is—trust,” states Stephen M. R. Covey, author of THE SPEED OF TRUST, which is already in its 5th printing less than three months after publication. Covey asserts that the ability to establish, grow, extend, and restore trust with all stakeholders—customers, business partners, investors, and co-workers—is the key leadership skill of the new, global economy. This is an assertion he is qualified to make after growing his father’s, Dr. Stephen R. Covey, leadership center into a global enterprise operating in 40 countries and the largest leadership development firm in the world.
What a world we live in. This is an extraordinary time to be alive and to look forward to the opportunities and challenges that face us in the next few years.
We just returned from Asia where we each addressed a large Japanese entrepreneurial conference near Tokyo. We were struck by the intensity of the participants’ attention and the quantity and quality of their questions. The number one question was, “How do you select a partner?” Participants wanted to know how to identify people who could be trusted as partners, team members, and/or employees. Great question—a globally relevant question. No matter what enterprise you are engaged in, selecting trusted players is more mission critical than ever. Recruiting is now further complicated by geography as more and more enterprises and teams are made up of people from various countries. We believe selection is more important than training. Said another way—talent trumps training.
We suggest that talent is really the results side of trust. You are known for your track record of results. More discriminating observers also note the way in which you achieve your results. Did you perform with integrity to agreed upon values? Did you achieve the results in a way that builds your reputation as a trusted performer in the future? Both your results and your methods form your reputation with others. While it is very difficult to teach the values and ethics side of trust, the good news is, with the right selection of talent, the distinction of trusted behavior and high performance leadership can be taught. Selecting trusted performers—“getting the right people on the bus,” as Jim Collins says in Good to Great—is just the first step.
Jack Welch was asked, “What is trust?” He answered, “I could give you a dictionary definition, but you know it when you feel it. Trust happens when leaders are transparent, candid, and keep their word. It’s that simple.” We could not agree more. You can feel and discern trust. It is palpable.
There is an expanding global war of talent. Competition for roles with the most exciting teams and the most important projects is intensifying. Building your reputation as a trusted high-performer is more important than ever. This is a fact not lost on our friends in Japan. We saw group after group of teenagers riding the subway after school on the way to “Cram School.” This is an extra curricular effort attended by the majority of Japanese teens to prepare for college entrance exams.
This new, global economy is pushing and probing our very paradigms, perspectives, and expectations. We truly must watch our assumptions.
A brief mention of a recent paradigm buster we encountered. Everyone is speaking of China as a future competitive threat on the global marketplace. Enter Kenichi Ohmae’s latest book, The Next Global Stage. If you don’t know Kenichi, the short form of his vitae is that he lept on to the global stage over two decades ago as he led Japanese and Asian operations for McKinsey & Company. He has since written over 100 books. We digress; his latest book pushed our paradigms about China’s role in the new economy in the next few years to the point that it deserves its own future Intelligently Brief Insight™. For now, in the spirit of brevity, one closing excerpt:
“The city of Dalian is situated near the southeastern tip of the Liaodong peninsula that hangs down from the coast of northeast China, the region formerly known as Manchuria. But in the last decade, the city has changed from being a sleepy port into one of China’s most important and dynamic industrial centers, with a population surpassing 5 million. …In the person of Mayor Bo Xilai, Dalian possessed an extraordinary local ruler. …Bo redefined the job description of a typical Chinese city major. No longer content with managing sewage and housing, he became his city’s chief architect and marketing officer, establishing close links with the cream of Japanese industry and business. …Helped by the charismatic Bo, Dalian, along with over a dozen other regions in China, has become a de facto regional state, setting its own economic agenda. While still part of China and, in theory, subject to the rule of Beijing, it is largely autonomous. The reality is that its ties with Beijing are weaker than those with business centers throughout the world.”
So, what’s our point? Consider this, a little over a decade ago, China surprisingly had no cities over 5 million in population and only 20 cities with between 1 million and 5 million people. As of 2001, there were six cities over 5 million and a paradigm-probing 160 cities between 1 million and 5 million. You do the math. Global competition is entering a new era.
The rest of the story of Bo Xilai, Dalian’s mayor? In early 2004, he was named the Minister of Commerce for the whole People’s Republic of China at the age of 53. Apparently, his pragmatic results and strong character combined fostered trust in him in Beijing.
You can get this recently published book at bookstores now, and we suggest you read it fast.
That’s the profound question New York Times three-time Pulitzer Prize-winning columnist Thomas L. Friedman asks his readers in his thought-provoking #1 bestseller, The World is Flat, A Brief History of the Twenty-First Century.1
Wait a minute, are you still convinced that everything you once learned about Christopher Columbus and the Santa Maria is true? Well, maybe it was—back then. But today, if you plan to stay in the game, Friedman suggests you reconsider and re-learn. In an interview with Tom Nissley of Amazon.com, Friedman explains:
“What I mean when I say that the world is flat is that sometime in the late 1990’s a whole set of technologies and political events converged—including the fall of the Berlin Wall, the rise of the Internet, the diffusion of the Windows operating system, the creation of a global fiber-optic network, and the creation of interoperable software applications, which made it very easy for people all over the world to work together—that leveled the playing field. It created a global platform that allowed more people to plug and play, collaborate and compete, share knowledge and share work, than anything we have ever seen in the history of the world.”
Friedman asks people in his book where they were when they realized the world was flat. Amazon’s Nissley asked Friedman where he was. His response: “I was in Bangalore, India, the Silicon Valley of India, when I realized that the world was flat. I was doing a documentary for the Discovery Times Channel about “outsourcing.” After 60 hours of interviews with Indian entrepreneurs who wanted to write my software from Bangalore, do my taxes from Bangalore, trace my lost luggage from Bangalore, read my x-rays from Bangalore, and draw my Disney cartoons from Bangalore, I realized that something big had happened– the world had been flattened–and I needed to write about it.”
Friedman suggests that when the tech bubble popped in the late 90’s, followed by the distractions of Y2K mania, the tragedies of 9/11, and the wars in Afghanistan and Iraq, we westerners blinked and missed the fact that the flattening of the global economy was beginning to accelerate at a hang-on-to-your-seat pace. Friedman interviewed Henry Schacht, who, during part of this period, was watching the whole process from the side of corporate management.
“The business economics, [he told Friedman] became ‘very ugly’ for everyone. . . . ‘Cost pressures were enormous,’ he recalled, ‘and the flat world was available, [so] economics were forcing people to do things they never thought they would do or could do . . . Globalization got supercharged’—for both knowledge work and manufacturing. Companies found that they could go to MIT and find four incredibly smart Chinese engineers who were ready to go back to China and work for them from there for the same amount that it would cost them to hire one engineer in America.”
Let’s think about this. Besides the fact that your accountant is already outsourcing your tax return work to India, your most recent CAT scan or MRI was most likely deciphered in Australia, you’re having a hard time understanding the English spoken at the other end of the help-line, and the MP3 you just bought came with directions in 14 different languages, what does this flattened world really mean for you and your future—both personally and professionally?
Friedman asked this question of Jaithirth Rao, whose Indian firm, MphasiS, is successfully and lucratively able to handle outsourced tax work “from any state in America and the federal government.” Said Rao, “It is a good question. . . . We are in the middle of a big technological change, and when you live in a society that is at the cutting edge of that change [like America], it is hard to predict. It’s easy to predict for someone living in India. In ten years we are going to be doing a lot of the stuff that is being done in America today. . . . Any activity where we can digitize and decompose the value chain and move the work around, it will get moved around. We can predict our future. But we are behind you. You are defining the future. America is always on the edge of the next creative wave.”
Defining the future . . . the edge of the next creative wave. . . . Just what is this future, this creative wave we’re all going to want to catch? Friedman supplies a solid answer through L. Gary Boomer, CEO of Boomer Consulting in Manhattan KS, who explains, “Those who get caught in the past and resist change will be forced deeper into commoditization. Those who can create value through leadership, relationships, and creativity will transform [their] industries, as well as strengthen relationships with their existing clients.”
According to Publishers Weekly, Friedman agrees with the transnational business executives, who are his main sources, that these [world flattening] developments are desirable and unstoppable and that American workers should be preparing to “create value through leadership.”2
At CoveyLink, we couldn’t agree more. The global call for capable, innovative, trust-based leadership is intensifying. World-class leadership and business relies on trust and trust has been the lubricant of commerce since the world’s first merchants began trading seeds, then beads, then goods and services.
“Fortune favors the prepared mind.” – Louis Pasteur
The growth of knowledge work both leads and informs this important global trend. Knowledge work is dependent upon relationships and relationships, of course, thrive on trust. Trust fuels this new global economy just as trust magnifies or diminishes every other leadership competency you have, including your vision—a vision which must now include the entire globe regardless of your industry or profession.
The world is not becoming flat, it is already flat. And, yes, it will get flatter. If you haven’t yet caught onto this fact, read Friedman’s book. In fact, we recommend you read it now, then read it again every year as a gauge to hold up against your most recent, brilliant strategic assumptions.
One last memorable thought from Friedman:
“In China, Bill Gates is a Britney Spears – they scalp tickets to hear him speak. In America today, Britney Spears is Britney Spears. That’s the problem.”
1 The World is Flat, A Brief History of the Twenty-First Century, Friedman, Thomas L., Published by Farrar, Straus and Giroux, 2005
2 Publishers Weekly, April 5, 2005
