Trust is the new gold

It is frequently claimed that data is the “new gold.” However, this holds not for the data itself, but what you do with it. Data and its exchange only serve the purpose of helping people to achieve a better quality of life. And there is one important lubricant in this process: trust. I claim, it is actually trust and not data that is the most precious asset any one company can possess. Let me explain why:

It is not the data itself, but what you do with it

Look at what happened after the Facebook and Cambridge Analytica scandal – when Bloomberg reported: “Facebook Inc. saw the first signs of user disenchantment in the midst of public scandals over privacy and content, with second-quarter revenue and average daily visitors missing analysts’ projections.” It is the loss of trust that had users delete their accounts. And this might be only the beginning – after all, it takes a lot of effort to gain trust, but it can very quickly be lost.

Trust is a very powerful force – and the basis of every well-functioning relationship

This does not come at a surprise. After all, trust is a very powerful force. It is nothing less than the foundation for every relationship. With an increase in digitalization and ever more devices being connected to the Internet of Things, what we see is a dispersion of relationships – with and without involvement of human beings. So how can we base this network of relationships on trust?

Rachel Botsman is a researcher that has been dealing with trust in her work. She argues that trust has evolved from being i institutional (authorities, legal contracts, regulation, insurance) to what we are entering now: distributed.

Technology could bridge gaps in trust (as seen in the past) – changing the way we live, work and consume. She claims that some now well-known innovative businesses have mastered to use technology to enable this kind of trust – see eBay, Airbnb or Tinder. Through technology, they have found ways to establish trust in relationships that were previously condemned – buying unseen products from strangers, sleeping in their homes or meeting with them for dates.

What this really shows is not only the need to find new ways of gaining trust in an era shaped by fundamental changes in technology, but more so that technology and technology based approaches (i.e., business models) can be the key toward establishing this level of trust.

Trust is key to the success of organizations

One thing is clear: Trust is no new concept in business. We have been building our companies based on trust for centuries. Already at the beginning of the 20th century, the famous German industrialist August Robert Bosch said, “I always acted based on the core believe, to rather lose money than trust.” The difference today is: Faced by ever more complex transactions and relationships, we need to make trust more explicit and actively care for our trustworthiness!

Lack of trust costs money, time and attention that could have otherwise been invested elsewhere. Basing everything on contracts or concrete rules and procedures, takes more effort and is often inefficient. Think about the effort you expend when lending money to a stranger (e.g., background checks, contracts, deposits) versus lending money to a friend (a written note to yourself so you don’t forget). This of course does not mean you do not need rules or procedures. You do! They help you steer through the complicated reality of participating in life – at home, in public and in the office. However, they are not sufficiently capable of navigating the ever increasing complexities of today’s volatile world. This is where trust comes into play. It helps you bridge the uncertain, unknown and ambiguous.

And the beauty is, it works both internally and externally for any organization:

• Internally, it is the glue that holds organizations together and enables true leadership. Only if leaders trust their followers, can they equip them with the right degrees of freedom. This in turn is a key ingredient toward followers also trusting their leaders. It will be paid back with a higher level of motivation and lead to more agility, higher efficiencies, more creativity and more innovation.
• Externally (and maybe even more importantly) trust is the most valuable resource to customers, suppliers and investors. It helps them navigate the infinity of today’s product and solution landscapes. If in doubt, customers will choose the company, the brand, or the sales representative they trust most. This is particularly accentuated with digitalization – here, Cybersecurity is the main ingredient to trust in a digital age.

Trust can be actively worked on – through becoming trustworthy

So, how to achieve trust? Well, this is more difficult. Trust is built and maintained by many small actions over time. Trust is not a matter of technique, tricks or tools but of character. You can only indirectly achieve trust – through credibility, reliability and openness. We are trusted because of our way of being, not because of our polished exteriors or our expertly crafted communications.

Trust is not rational or computable. But still I believe you can deliberately work on it. You can make it explicit. The first step is to be reflective and analyze what you have done in the past to create the trust that you have between yourself and your customers and your own employees. From a technical and organizational perspective, Cybersecurity is a key ingredient to increase your level of trust. But it is more than technology; it really is about establishing a trust narrative and crafting the whole organization, its people and processes to be reliable, credible, ethical and open – to be trustworthy. And in a networked world based on complex supply chains and ecosystems, this might not even be enough – you also need your ecosystem to be trustworthy. In the end, cybersecurity and a potential lack of trust are the Achilles heel of the digital economy. This is why collaboration is needed beyond organizational boundaries to mine for this “new gold” – for example in initiatives like the “Charter of Trust” (www.charter-of-trust.com).

Being trustworthy is an investment

So in the end, becoming or staying trustworthy is an investment, because it is the underpinning of new digital business models. And you better take it seriously and address it with all your power - for the person who looks trustworthy but cannot be trusted, is the worst. And in the end it is a delicate choice made by the customer whether they trust you or not. Or as they say: “All that glitters is not gold”