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The road to business success rarely stays smooth, and while you may aim for your enterprise to tick along like a well-oiled German luxury sedan, bumps and dings and accidents and upsets along the way are all but inevitable. Some common examples include an executive falling ill, the loss of a major client, or a top-to-bottom restructuring to pivot the business to new markets. Take heart, though. A new report says that if your company suffers a serious disruption of some kind, it may actually boost your employees’ trust levels and tempt them to stay with you in the long term, but only if you manage the crisis well.
The data, from SparkEffect, a small Seattle-based organizational development firm, found that 71 percent of the companies surveyed had experienced some form of disruption in the last two years. Unsurprisingly, the most common disruptions were AI-driven changes forced on business operations, with 37 percent of companies going through this disruptive process. Leadership team turnover was a close second, with 36 percent of companies affected, and further down the list were disruptions like layoffs or company restructurings, personal crises, cultural overhauls and job redesigns, Human Resources Director noted.
The investigation showed that if companies deal with these disruptions well, it can boost employees’ trust levels by 12 percent over the baseline. Meanwhile, if the company’s leadership fumbles the play, it can actually crash employee trust levels 28 percent under the baseline — a pretty dramatic shift.
The focus on trust is important, because the research showed the biggest impact a business-disrupting event can have is on manager trust — even more than workers’ trust in the overall organization. Data show that staff trust their direct managers more than company leadership, which might explain why a badly bungled reaction to a dramatic business disruption can have a significant impact. The report highlights this and notes that while “trust in local leaders often starts higher than trust in the organization as a whole,” it is actually “more fragile.”
Organization-level leaders do well with retaining employee trust if they exercise good communication throughout a disruptive event. The report also says that if leaders are fair and clearly empathetic to their workers that can boost trust, also if they offer staff the chance to explain their concerns.
But if managers exhibit poor transparency, and there’s a misalignment between the decisions the leadership makes and what employees feel they need, including bad handling of tech rollouts (critical in the “all in on AI” business shifts that are trendy right now) then that can harm workers’ trust.
Much of this thinking resonates with an interesting report that recently underlined how important middle managers can be in an organization, despite the current trend for ditching midlevel managers in favor of a flatter org chart. The survey from San Francisco-based workplace communications outfit Firstup showed that more than half of the 1,000 U.S. non-management workers surveyed said their direct manager was their “most trusted source” for up to date workplace news. Just 10 percent said they think senior leadership is their best source for this info.
There are some very clear lessons for running your own operation here.
Rolling out AI systems is a surging workplace trend at the moment, as companies seek to boost worker efficiency and glean higher profits from their revenues. But AI rollouts can be dramatic and disruptive, as this new research points out, unsettling employees who may have to deal with unfamiliar, radically new technology, possibly requiring upskilling, even as they worry about the long term implications AI has on their employability. If you’re pivoting to include AI in your business, handling it carefully, with clear communication and an openness to hear employees’ concerns is a must. Otherwise worker trust may fall, and the secondary impact on their engagement and your profits may be marked.
Similar thinking should be included in your management decisions should your company encounter other disruptive events. Fairness and empathy are your friends here.
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Kit Eaton
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