2014 starts with a conversation about Trust in the Social Age. What is trust? At a simple level, an investment of our wellbeing in the hands of others. To trust is to be vulnerable. To trust is to hope that others have our best interests at heart, equal to or beyond their own. To trust is to believe in organisations and individuals.
I subscribe to the notion that organisational culture is framed by the organisation, but co-created and co-owned by individuals, based on a foundation of trust, so there is great value in understanding how and why that trust is corroded. To lose trust is to lose your culture.
I’m starting by looking at Financial Services. Why? Because they have lost the trust of many people and are struggling to redefine (or just define?) organisational culture in a long play game for the next decade.
The Financial Crisis has seen us redefine banking away from a purely financial transaction towards more of a relationship view. In the Social Age, the relationship between the organisation and individual (be that employee or customer) has evolved to include a greater focus on values and sustainability, as well as a wider recognition of what is ‘right‘ and ‘fair‘ in terms of rewards and renumeration.
In short: the culture that drove the skyscrapers ever higher and put more and more Porsches in the parking lot now drives dissatisfaction and mistrust. There needs to be a stronger association between values and reward, between trust and culture.
We should be clear: trust has not been eroded by the wind and the rain, it’s been undermined through systemic failings in culture. Even as recently as last year there are allegations, currently being investigated, that major high street banks sought to manipulate foreign exchange rate mechanisms, even as supposed cultural reform was underway.
We can blame a minority, but the trouble with a co-owned model of culture is that to blame some is to find fault with all: culture is not imposed upon us, it’s co-created by us. We can point the finger no further than to the end of our own noses. Sure, we may not be the ones breaking the rules, but rules alone do not define compliance or trust. They may ring-fence it, but the devil’s in the details.
Roger Steare, in his superb book, ‘Ethicability’ asks “Do we do what’s legal or do what’s right – and how do we decide?“. He goes on to talk about the plethora of rules that govern or seek to influence culture, “…too many rules tend to make us lazy in taking responsibility for thinking about what’s right and we can never write enough rules to cover every situation“.
Rules may frame culture, but they won’t define it. To do that we need to understand the pressures that corrode the culture, to better understand how we can counter them. For this reason, my starting point with the CAIR model has been to look at four dimensions.
First we look at COST: what does it cost you to be part of a culture? What are the costs of being within the community? Morality, Ethics, Culture and Future may be in play here. When we join an organisation, become part of it’s culture, a co-owner, we invest our reputation and moral integrity in it. We exercise judgement based upon our ethics. To an extent, we invest our potential futures. When cultures fail, there are very personal consequences: ethics are not deterministic. To be associated with an organisations that exhibits failures of morality or ethics is to tarnish our personal reputation. The cost of corroding our culture is to squander that which we have invested in it, often over many years.ASPIRATIONS may be for personal or family financial security, for pride in what we achieve, to fulfil dreams and create a better future. This is fractured when trust is eroded. This is true equally for clients, customers or employees: in the Social Age, your organisational reputation and brand is owned within the community, and if the community judges you as failing (irrespective to some degree of whether the law does), then reputation is harmed. And who wants to be associated with that? This isn’t simply some PR exercise though: at a time when we most need people to be engaged in co-creating a new culture, we run the risk of them being alienated by the existing one. This is a narrow path we need to walk with care.
We INVEST heavily in our work: with our time, our effort and emotional energy, but also our integrity and our whole ‘self‘. Time may be finite, as easy to waste, but integrity more so: betraying our personal integrity leaves a hole that’s hard to fill. If we look at the NET Model of Social Leadership, you can see integrity underlying many segments: particularly ‘reputation‘ and ‘authority‘. Without our reputation, it’s hard to effect change, so the situation can be self perpetuating.
REWARDS comes last, although is often viewed first: organisations think about profit before they think about what’s right. Remember, as Steare said, there’s ‘legal‘ and ‘right‘. Rules may keep us legal, but do they make it right? Rewards may be financial, but may be around reputation (of organisation and individual), about status (within the organisation and wider society), and potential.
There is a subtle interplay between these four dimensions: Individuals deposit their money in banks in search of security and financial returns. But they also invest their time to work their or their trust to bank there. Employees aspire to build a future, but the cost of a failed culture is that very future. They aspire for security, but should that be at the cost of integrity, reputation or status? Does money make everything right?
I suspect there are clear opposing pairs, which i will keep working on to develop further. Why?
Because the solution has to be grown within the culture itself: we have to understand the pressure that corrode integrity in order to counter them, and we have to operate with an understanding of all pressures, not just the ones we are familiar with or that feel obvious.
The willingness of the organisation to learn will underpin it’s ability to co-create a new, stronger, sustainable culture. This won’t cascade down from above, it will be forged in the trenches and, crucially, in the communities. The co-creative process goes beyond the four walls that historically defined the world of work.
Financial Service organisations face an unparalleled challenge: there’s no doubt that behaviours need to change, but without countering the four forces that oppose each other and influence culture, the chances of long term change are slim.
It’s easy to view a transactional relationship between organisation and customer, or between organisation and team, but this is incorrect: the entity is only the people. Even understanding the stakeholders is complex: individuals, communities, media, shareholders, all have a role to play in writing the organisational narrative in the Social Age.
Effective culture change will be founded upon an ability to diagnose the pressures on individuals and give them the tools to recognise the challenge and find a voice to effect change.
Rules and regulation may frame the challenge, but won’t solve it. Simple leadership training won’t do it either: we are not fighting against one force, not simply replacing ignorance with knowledge. Corrosive cultures are not the effect of a single pressure, they are co-created in response to specific drivers and rewards. Some people thrive in these spaces: it’s not a battle between good and evil, but rather an evolution of ‘normal‘.
The way we change culture is to make it unthinkable to be otherwise, but that mindset has to be grown and nurtured, not imposted and mandated. The change has to come from within: we can influence and reward it, just not inject it.
I’ll follow this article up with further pieces around each of the four dimensions, as well as some practical insights into the learning that can underpin this cultural evolution. Please do share any insights or thoughts as i go through this process.