LATEST

In countries like India, South Africa, Italy, and the United States, institutional trust is declining. People have less faith in businesses, governments, and the media. But this is not a global trend. The 2018 Edelman Trust Barometer reveals that China, the UAE, and Sweden are experiencing dramatic gains in their faith in institutions while the United States has seen a drop of 37 points.

So how can companies successfully navigate this complex state of affairs? Research  from the University of Minnesota confirms that understanding the basis on which people trust has become increasingly important to forging international business relationships. As Stephen Kehoe, Edelman’s Global Chair of Reputation, told me in an interview, “If you are even slightly unaware of how a particular set of stakeholders regards your company, sector, or country of origin, you are at a disadvantage. You may not be aware that you are acting in ways that erode trust.” Here are three things leaders in this position can do to strengthen trust and avoid dangerous pitfalls.

Your personal credibility is your greatest asset. Being from a sector, industry, company, or country that is not widely trusted won’t stop you from freely conducting business. It will, however, put you under harsher scrutiny. Still, people are often willing to trust if they believe there are advantages in doing so. Trust is an economy with multiple currencies. Some extend or withhold it based on the personality types of others. Others look for depth of competence or character traits like honesty or compassion. Many even find comfort in conducting business with people who remind them of themselves. Decoding the methods your stakeholders use to determine who is and who is not worthy of their trust will help you find ways to earn it.

Individual relationships forged through mutual respect often build trust faster than any strategy. Says Kehoe, “You need to figure out how to connect as the most authentic and honest human being you can be, having the most genuine conversation you can about why you are there. You will need to bring humility, openness, and patience.” Research confirms that when you present yourself as someone who has characteristics worthy of cognitive trust (reliability, competence) and affective trust (empathy, closeness) you build strong relationships faster.

Know what matters to your stakeholders. Local stakeholders usually hold opinions of you and the type of business you run that will determine the degree of trust they extend or withhold. Understanding their perspective and concerns will allow you to better prepare for doing business with them. In more developed nations where trust is often strong, maintaining consumer safety and building a competitive job market may be vital concerns. In developing regions where trust may be weaker, job creation, improving quality of life, and economic prosperity for future generations may be more prevalent concerns. You need to know what your stakeholders want and adapt your agendas accordingly. Says Kehoe, “The choices we make in how we conduct business must be filtered through the lens of local relevance. Otherwise, you risk missing opportunities to strengthen trust. Or worse, lose opportunities to build trust that was never there.” For instance, a client of mine recently opened a manufacturing facility in China after years of preparations. One obstacle that initially slowed down their progress was failing to recognize the training needs of the broader professional community in the region where they were building their plant. To resolve this, they constructed a training center to teach people the skills needed to work at the plant — resulting in higher-paying jobs for locals. By listening to the needs of the community, my client was able to complete their project faster while building a foundation of trust with their stakeholders.

Keep messages consistent; be transparent when you adapt them. In today’s hyper-connected world, inconsistencies can be damaging. The messages on your website, in your marketing collateral, and the general information you share with the public must be consistent. Edelman’s research concluded that 59% of the general population has trouble determining if their news is coming from a valid source. As a leader conducting global business, you must recognize that everything you say and do will be scrutinized for accuracy and consistency. Further, if you change your message to appeal to different clients, you must be transparent about doing so and why you are doing so. For example, a leader engaging prospective customers in South Korea may share information about their business based on what they believe their Korean clients want to hear. That same leader may then travel to Malaysia and share different information based on what they believe their Malaysian clients want to hear. While the leader will emphasize different aspects of their strategy for these audiences, it’s critical that they are straightforward so their actions won’t be perceived as manipulative or contradictory.

Says Kehoe, “Everyone with whom you are dealing knows you have an agenda. The more upfront and transparent you are about it, the less likely you’ll end up having to defend it later when stakeholders start to become suspicious of what it might be.”

Transparency is even more important when leaders use their voices to address local issues, as evidenced by the rise in CEO activism. In fact, Edelman’s research shows 64% of the global public believe CEOs must speak out about public policy, regulatory and social issues, and see business leaders as more trusted than government leaders and media experts. If you are visiting a foreign market, consider taking the time to meet with local government officials and speak publicly about vital concerns within that region. Doing so can not only strengthen trust in your company, but it can impact the well-being of the region. For example, if you are a Consumer Products Company entering a region where consumer safety is a concern, declaring your intent to improve food safety within the supply chain may greatly enhance local trust and consumer confidence.

Fewer attributes have seen more volatility on the global stage than trust. If you are a leader responsible for conducting business in other parts of the world, it’s time to accept that the rules have significantly changed. We can no longer assume people want what we have, and will automatically trust us to provide it. Earning and keeping trust across borders takes forethought and careful preparation, and in an increasingly global economy, is more important than ever.

from HBR.org https://ift.tt/2JyaxNC