Getting anything done between two parties requires trust. Even the simplest matters need it. When evaluating confidence in any relationship it’s helpful to use some simple logic — it’s time to revisit The Trust Equation.

Maybe it’s the engineer in me, or maybe the social biologist. Or perhaps it’s that part of me that wants to use equations to understand human interactions. Whatever it is, I use this formula often and it has a prominent place on my list of important things to keep in mind.

Trust = (Intimacy x Credibility) / Risk

• Don’t get hung up on numbers. It’s the ratio that’s important. You can fill in the equation with subjective observations like: High/Low or Yes/No.
• The bigger the deal, the more trust is needed. Basic transactions don’t need so much thought. I buy gas where it’s cheap and convenient. Risk is low and I assume the service station is a credible supplier of petrol.
• Intimacy is a function of time and space. Being closer and having more frequent interactions brings greater intimacy. Intimacy is generated via personal and in-person interactions.
• This might be the simplest explanation for what gets lost with remote work and virtual meetings. At the same time, it shouldn’t be assumed that physical proximity automatically generates intimacy. The point is; intimacy is part of the equation and when fostered, improves trust.
• Credibility is gained by keeping commitments. Even the smallest commitment – like being on time for a meeting – builds credibility. So, credibility is a series of data points connected to commitments. Since it’s data now, one could easily draw a trendline. Interestingly for these calculations, a single data point is a trend – miss one commitment and you’ve lost some credibility. Lose too much, and you can never get it back. When this happens, the players must be swapped-out for any chance of success. A lot of credibility is determined via small interactions – so don’t mess around with this one.
• Risk is always personal. There is no such thing as organizational risk. People’s sense of personal risk (as opposed to physical) almost always revolves around their perception of how they are or will be viewed by others. The question people ask themselves is: “If this turns out bad, how will I look for me? How will others view me? How will I view myself? And, will this affect my future success?” For humans, negative perceptions, especially from others IS risk.

It’s fairly easy to see how intimacy and credibility offset risk and how balancing these qualities leads to greater levels of trust. The greater the risk, the more intimacy and credibility required. Try it for yourself by applying it to some of the issues you’re dealing with now. The trust equation can help us all navigate relationships, tough decisions and any transaction that requires human-to-human cooperation.

Apparently, organizations are losing their often stated, but rarely demonstrated, most valuable asset – their people. You can’t open your news feed without seeing an article on The Great Resign. The media has latched onto the idea that workers are leaving their jobs in droves — which is great news for employee engagement survey companies.

The problem is bigger than it appears because we use the most obvious metric, people quitting their jobs. What about everyone who disengages without leaving, treading water for a paycheck and, at least in the US, health insurance?

The good and bad news is, for individuals who decide to leave their unfulfilling situation, there are plenty of other jobs to slot into that probably aren’t much better.

If we hold that better engagement leads to greater job satisfaction and higher retention rates – trust me, this equation is proven – then we can imagine there must be tactical solutions. No; more pay is not one of them. The fixes require a fundamentally different take on how people work together inside the organization. The effects of greater engagement and employee enthusiasm are fairly easy to understand – we can all relate. But, challenging the status quo of traditional organizations that think in terms of bosses and subordinates is hard. In other words, what needs to actually be done isn’t such an easy change.

Companies that understand the basis for the problem are better suited to develop effective solutions. They will be the ultimate winners in the current and ongoing musical-chairs-employment-job-fair extravaganza.

Unfortunately for employees in less enlightened organizations, engagement surveys are often the beginning, middle and end of failed endeavors. Mostly, because they’re easy. Here’s some advice that could save a lot of time and energy and actually avoid additional discontent related to typical surveys: Don’t do them at all. Even without a survey, we know that better engagement delivers results. It’s like communication. You always need to do more than you are.

So, forget the survey and just focus on better engagement. That said, if you decide to do one, share the results. It’s a pretty big disconnect when people are told their input is valued and then hear nothing about their valuable input. Better yet, have a tactical plan for how to address areas of concern – something beyond an employee newsletter, one-on-one feedback sessions and the one-off town hall meeting.

Let’s look at a few of the more obvious problems with the surveys:

• Fear of retribution – Employees often avoid these types of inquiries or give elevated ratings. A lot of people believe they are tracked (unthinkable I know) and that their honest inputs or critical feedback will only make their situation worse. “No way am I doing that survey – I don’t believe that it isn’t linked to me. If I’m forced, I’ll just say it’s all good.”

Here is an idea for a simple employee engagement survey that would tell you everything you need to know. Ask just one question: Are you be interested in taking an employee engagement survey? Have everyone put their answer on a piece of paper, fold it in half and drop it into a sealed box. If the trend is no, well, then… engagement is poor.

• Cognitive Dissonance – No one likes to admit, especially to themselves, that they are not really valued and their opinion doesn’t matter. So, when asked for their input, people tend to be a little optimistic. When we experience one thing, but need to believe something else – especially for our own self-image – we feel the discomfort and anxiety of cognitive dissonance. For most, it’s easier to modify one’s beliefs than to change their work environment. In other words, if I’m forced to fill out a survey, things look pretty good.
• Hopelessness – “I’m not doing a stupid survey. I’ve given my input for years. They know what I think and nothing ever changes.”

Translation: I’m not engaged enough to tell anyone I’m not engaged enough.

• Management doesn’t know what to do with the results. Even if engagement surveys are perfect, ask all the right questions, and everyone completes them as accurately as possible, many managers don’t understand how to use the information. “We received the feedback, but it’s only the disgruntled employees who responded.” This may be somewhat true because the most irritated of the lot are already over the edge and don’t care much about retribution. Yet this comment misses the point in some obvious ways. It also shows that cognitive dissonance happens at all levels.

“Our ratings were low, but we were able to identify some individuals who are really upset. I spoke with them, heard their view and now things are better.” No, they’re not.

“We had a nice team-building event sponsored by the VP. The food was very good and everyone had fun. Our engagement scores were no better the next year.”

Some Things Change Quite Slowly

A recent article from McKinsey (link below) covers this topic well. It discusses what employees want from their workplace and how employees and management perceptions diverge. It’s a good article because it reminds us of something we’ve known for decades.

Every analysis of this type for the past 50 years has told us the exact same thing. Employees want to have a voice in the work they do. They want their opinion to matter. They want to participate in meaningful work and they want some recognition for their efforts. It’s really this simple.

To do this however, means that bosses and managers must give up some control. In many organizations, this is a foreign concept. It requires a deeper sense of trust, a common focus, greater understanding of work flow, distributed decision making, clarified roles and accountabilities, effective feedback mechanisms, and most of all the willingness to change. To be clear, it’s not just about managers giving up control. It’s also about subordinates accepting more. We have found that both sides of the equation resist vigorously.

These days, hard things are avoided and fundamental change is impossible for many. Without a significant emotional event, this slow drip (or flood) of employee attrition will be viewed as inevitable – just something we all need to get through. By paying attention now and using the current environment as a necessary catalyst for change, the best will rise to the top and take concrete measures to truly engage their people in a way that really does deliver employee enthusiasm for the place they work.

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All quotes in this article are real quotes from individuals we have spoken with first-hand recently about their current work experiences.

Links for additional information

‘Great Attrition’ or ‘Great Attraction’? The Choice is Yours
https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/great-attrition-or-great-attraction-the-choice-is-yours?cid=eml-web

Results Improve When Managers Give Up Some Control

https://www.kaufmanglobal.com/control-freak-much/

Employee Engagement Definition

https://www.kaufmanglobal.com/glossary/employee-engagement/

The Lean Daily Management System

https://www.kaufmanglobal.com/glossary/lean-daily-management-system/

With the first quarter underway, everyone is leaning into 2021 with great expectations. Last year, technical and process levers were pulled to address business problems brought on by the pandemic. Now that things are settling a bit, it’s time pay more attention to people – your people. Doing a few things to ensure health and cohesion at work has as much impact on your business as any process or technical solution. Showing respect for people and following a few simpler rules leads to happier, more productive teams and better employee retention.

Telling Stories

Whether 2020 was crushing for your business or gave you an unexpected boost, everything changed. Job changes, pay cuts, more work, less work, remote work, lost colleagues, family stressors… the list goes on. People are still under stress. But from this chaos there is an opportunity to draw people closer, be attuned to their needs and be thoughtful with your intentions. Leaders must pay attention. Mis-steps here will shape their future and the futures of their companies. These are the things that people remember and the experiences from which stories are told – both good and bad. ¹

What People Expect in a Relationship

Interactions at work are relationships. They are important. Good relationships have certain qualities. People expect things from them. For example, they want to be kept in the loop with information that is relevant to them. Seems reasonable. Or, they notice and appreciate when those inside the relationship keep their commitments. No surprise here. The point is, work relationships with team members, peers, subordinates and bosses are no different than any other relationship when it comes to what people expect. And you know what happens when people don’t get what they expect, right? They get upset.

Good communication is important. Showing respect is important too. It’s tough to argue against either of these. But in this instance, they’re too vague. They don’t give enough texture to what must be done to foster better connectivity and teamwork. So here are 5 specific things that everyone expects in a good relationship and that anyone can do.

1. To Be Kept Informed
   People need to know what is going on and how it might affect them. Communicating what you know, when you know it. Say what you don’t know too. Try to have the obvious questions answered beforehand.
2. No Surprises
   Surprises are triggers. See Rule #1.
3. Accessibility
   Being accessible is not the result of emails or standing meetings. It sometimes happens during the after-meeting and is harder to do in the virtual world.
4. Commitments Kept
   Be prudent with your commitments. Keeping them is vital. Credibility is on the line.
5. Follow Through
   Maintain momentum and cadence. Simple responses and acknowledgements help. Ask questions. Dig deeper when you need to.

On Balance

Sometimes we forget or even avoid the human side of the equation. How we treat others is more noticed than business processes or technology innovations. If people are your most important asset, treat them that way and do the small things that build stronger bonds and better teams. Everyone will be more engaged; your business will be better and so will the stories that are told.

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Notes:

• A 2019 Gallup poll estimates that voluntary employee turnover costs US businesses alone $1 Trillion annually… and much of this is fixable.
• ¹If you are interested in how experiences, memories and the stories we tell about our lives are connected, check out Daniel Kahneman’s epic TED Talk on happiness: The Riddle of Memory vs Experience (20 minutes).
• For a deeper dive related to this topic, register and download Engage the Organization for a Performance Culture white paper.

Feedback from Colleagues – A Moderated Thread

If you have a story to post, send it to me: jtimpson[at]kaufmanglobal.com

The Importance of Trust

Certainly the 5 steps go a long way to building or destroying trust.  I view trust as the accelerator in a change model.  If you have trust you can go a lot faster.  We did some things right out of the gate last year that I believe proved critical to our success.  In March we told our employees we were going to keep everyone employed even though we knew business was going to drop.  We wanted to remove uncertainty for them and their families.  We asked them to take the time they would have and double down on improvement efforts.  Our improvement efforts sky rocketed.  We focused on improving efficiency and increasing capacity.  We also accelerated our digital transformation and accelerated efforts to automate processes and cross training as we were concerned about how quarantine would impact absenteeism.  To improve communication we developed our own 5 tier system on how we would operate, later the state adopted a similar approach of color coding counties.  We provided daily, then weekly video updates on what we were doing as an organization. 2020 was certainly a challenging year.

~Bryan Debshaw (CEO Polaris Laboratories)

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Personal Responsibility

This is a great article. However, I would like you to consider another point of view….honesty and transparency. Everyone is accountable for there performance and if they are falling behind, their leader must be honest with where they are not living up to expectations. We should be clear, performance is up to the individual, not the leader… we are all accountable for how we perform, our leaders should help us, but success is up to me!

~Matt Taylor (ex-Woodward Inc.)

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Rational, Emotional and Political

I watched the 20-minute video, The Riddle of Experience versus Memory.  I found it fascinating. My key takeaways.

• Experiential happiness and memory happiness are different; this distinction must be understood and recognized when attempting to affect either.
• Because experiential happiness is fleeting and memory happiness is error prone; businesses utilize performance metrics to enhance their business decisions.  (The 20-minute video did not say this – nonetheless, this was my key takeaway).

My second point stated another way: Businesses are affected by the rational, the emotional, and the political.  Experience and memories affect our emotions and our politics.  Performance metrics affect the rational.  Because businesses are run by humans, we will never eliminate the emotional nor the political.  To the extent that organizations can minimize the emotional and the political and maximize the rational, they will be more successful.

~Bradford Anderson (Ex-Saudi Aramco)

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Good (and Great) Leadership

I gave your article some serious thought and offer some commentary.  I agree with five keys points to build strong relationships.

From my perspective, a good leader takes a genuine interest in people at a personal level and not just on a professional level.  A good leader recognizes that people are motivated by many factors and one of the strongest factors is friends/family.  The need to financially and emotionally support a family is a key driver for the actions of most everyone.  Let’s face it, work-life has morphed in many ways to a 24/7 culture, especially with the continued evolution of technology.  It is a challenge for people to leave work at the office/factory/field and focus on the family.  Good leaders recognize the need to let people take a break from the “grind” and recharge their energy for the coming days.  This recharge usually happens at home.  Good leaders also take a deliberate approach to acknowledge the personal side of employees’ lives.  This might be done by opening a conversation about someone’s family, hobbies, favorite sports team, or many other topics.  Communication is key and listening is an imperative.  A leader should also not be afraid to talk about their own personal lives.  Strong relationships are built around an understanding of what drives people.  Many years ago, my wife and I were going to celebrate our fifth wedding anniversary and we were planning to dine at a restaurant in Tulsa, Oklahoma.  I reported to a leader that was very good at interfacing with me on a personal level, and through our daily conversations, he became aware of our marriage milestone.  This kind of conversation was a regular part of our daily interaction.  When my wife and I arrived at the restaurant and were greeted by the server, we were told that a bottle of champagne was waiting for us.  Much to our surprise, my manager had contacted the restaurant and purchased the champagne to help us celebrate!  This kind action sent a powerful message and became a learning moment for me as a developing leader.  My manager’s action told me that he recognized I have a life outside of the office and that he had been listening about my upcoming plans. The fact that he took time from his busy schedule to contact the restaurant and surprise us made me feel valued and motivated to follow in my leader’s footsteps.

~Mike Whittenberg, Repeat Precision

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Communication is Key

What comes to my mind is an experience we have had at one vendor’s manufacturing site, south part of Russia. We came to a final inspection and to discuss terms of equipment punch list fulfillment after delivery. It was a big piece of equipment (a vacuum column with weight over 560 tons) and required water logistics before ice closes navigational period in Omsk. And the window was about to close, we could not afford waiting for another year. So the supplier was in a hurry, their local management explained an action plan and that there were some defect spots on few welding seams (4 meters in total) – welders had to cut out these spots and weld them all over again with further NDE (non-destructive exam). My colleague and I were at the shop floor next to our unit being processed. I began to suspect that the repairing activities were not up to promised schedule. So I asked my companion to climb to a welder and talk to him, find out if something is missing or he needs help. After 5 minutes conversation we realized that the welder was irritated, he required consumables and assistance of a metalworker, he was waiting for more than 3 hours. Next I talked to another worker and find a similar situation. Long story short – we have investigated this and realized that there was no communication or connection between production management and their value adding personnel at the shop.

Before we experienced this scenario our inspector was meant to execute both inspection and expediting activities while visiting manufacturing site. As a corrective measure we separated these tasks when managing vendors with low rating. In other words if, for some reason, the vendor experienced difficulties to keep up mfg schedule, two resident inspectors were engaged at shop floor and the one doing expediting performed daily milk runs to make sure production management and value adding workers linked together and daily schedule/plan was followed.

I hope my example helps you adding some value.

~Pavel – Oil and Gas Industry

Anyone who has been involved with Lean for any period of time has probably concluded three things:

1. Once demonstrated, lean concepts are relatively easy to understand.
2. With support, lean concepts and tools are relatively easy to apply.
3. No matter what, lean concepts and tools are difficult to sustain and expand once implemented.

Often, lean success is defined as the existence of a “kaizen culture” in which lean tools are effectively applied, by enthusiastic employees, to eliminate waste every day.  If this is true, then many organizations should probably quit their lean programs now, as they will never succeed by this definition.

There is no roadmap for achieving a kaizen culture, and left to their own devices, most organizations will run out of time and patience before they discover the path.  This article explains a process used to develop a kaizen culture and with it, achieve lean success.

Kaizen culture is characterized by:

• Extensive knowledge of, and success with, the tools of lean manufacturing;
• Ability to apply the tools every day to improve operational performance without overt management direction; and,
• Knowledge of where to apply the tools, or a process for continuously refocusing on problems and opportunities.

This level of lean success requires incredible focus and discipline over an extended period of time (50 years for Toyota), extraordinary management leadership, vision and commitment, and enlightened corporate leadership.  Most companies that have succeeded with lean have done so because a small group of people have driven it relentlessly, achieving gains by the application of lean tools and then, transforming the culture to embrace the tools and build the discipline to ensure continued adherence to lean concepts.

Unfortunately, most organizations lack the charismatic, committed leader capable of driving such a change by force of personality alone.  Such organizations need a more structured process for achieving the discipline and focus necessary for lean success.  This process is the Lean Daily Management System^®, or LDMS^®.  While LDMS implementation will not guarantee lean success, it will, if properly applied, gradually build the foundation skills necessary for success.

LDMS is focused on intact work groups of five to nine people.  It provides an integrated set of planning, measurement and problem-solving tools to help the work group:

• Focus on daily performance measurement and improvement
• Improve effectiveness of supervisory communication
• Solicit and evaluate employee improvement ideas
• Assess lean status and define improvement objectives

The LDMS is a process that, if diligently followed, will build the new “habits” necessary to develop a kaizen culture.  LDMS has five key elements:

1. Primary Visual Display (PVD) serves as a central communication point for a work group. The work group members themselves maintain performance metrics, schedules, improvement actions, cross-shift management issues and other useful group information on the PVD.
2. Shift Start Up Meetings, of ten minutes in length, are held daily in front of the PVD and serve as a forum in which to recap prior day’s performance, communicate critical information for today, reinforce safety and other work group practices, solicit solutions to problems, etc.
3. Work Group Metrics and Short Interval Coaching, such as hour-by-hour charts, display expectations, actual performance and problems or issues through the shift. Performance metrics are essential to instill the discipline necessary for standard work and other lean practices to be sustained.
4. Kaizen Action Sheet (KAS) System is a tool to systematically collecting and evaluating employee improvement suggestions. Most employees are full of ideas and are willing to share them, but lack a process to capture the ideas, evaluate them and ultimately implement them for operational improvement.
5. Long-term Improvement Planning Tools, such as the KG 20 Keys^® assessment, help facilitate improvement planning and goal setting. While day-to-day problem solving is important, it is also critical for work groups to focus on longer-term improvement needs and maintain a plan for achieving improvement goals.

The LDMS seeks to build new lean habits in the work area.  And, like any new habit-building program, the LDMS must be practiced diligently for a period of time, (90 days seems to be the minimum), until the new processes gradually become “business as usual.”  Day-to-day, hands-on coaching of work groups and team leaders is essential to ensure LDMS acceptance.  Initially this is accomplished through process compliance, but ultimately through knowledgeable use of the tools.

LDMS implementation is a slow process, but one that must be undertaken to ensure that lean implementation does not turn into yet another “here today, gone tomorrow” improvement program.  LDMS for a work group will typically be implemented over a four to five-week period, introducing one element each week and extensively coaching the element’s use after introduction.  Once the elements are fully implemented, it can take another six to eight weeks for a team to “get it” and begin to work effectively on their own.  During introduction and on a regular basis thereafter, LDMS process and performance must be assessed to ensure success.  Diligently following the process is the key to LDMS success, which in turn, is the key to establishing the kaizen culture so essential to lean.

The LDMS is focused on improving micro-process (work group) performance in a lean system.  It is part of a broad-based lean deployment, not a substitute for value stream mapping, kaizen events and other methods to identify and implement lean improvements.  Think of LDMS as the glue that will hold lean improvements in place and gradually broaden the application of lean tools within your organization.

Work group LDMS must be linked to higher-level operational management activities within an organization to ensure seamless communication of expectations, feedback on results and review of improvement ideas.  As teams and organizations gain experience with LDMS, work groups become more empowered and the freedom to act increases dramatically.  LDMS will help bind lean changes to the process and build lean thinking into the culture at the lowest manageable level of the organization—the intact work group. The LDMS enables average groups of employees to form into teams and begin to self manage.  LDMS is the missing link of lean success for many organizations.

This article was written by William Roper in 2001 and published on the Society of Automotive Engineers (SAE) website – it has since been hidden behind their firewall. Over the years, the article has been cited many times as people try to explain what makes Lean work or fail inside the organization. Bill is an authority on Lean and all things related to operational improvement. I have learned much from him. Early on, he taught me and many others about how to conduct the Kaizen Event – before it was even slightly in vogue and since then, about the absolute importance of leadership and employee engagement. It seems fitting to re-visit this article now 20 years on, to see how much or how little, things have changed. ~ Jerry Timpson, Kaufman Global

Lean Daily Management System^®, LDMS^® and 20 Keys^® are all registered trademarks of Kaufman Global.

Bill Roper is a Lean and operational excellence expert. You can find him here on LinkedIn: linkedin.com/in/bill-roper-a197581