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The importance of building trust and empowerment within an organisation

Recent research has shown that trust and empowerment has a far greater influence over the fortunes and failures of companies from day-to-day and year than the official hierarchy.

In high trust organisations, transaction costs are far lower. For example, if people in different departments or regions (say, marketing and sales, or Asia and Europe) feel enough trust to speak candidly together about their impressions of the market, and the quality of work processes, and the way to improve work, then they have much more opportunity to innovate and think together.

The organisation chart basically shows you the formal rules. But to understand the organisation and how it actually works, you need to understand the human network and values. For people to be able to break through the formal organisation chart and act in ways that make sense for the customer, people have to be given the power and authority to do this. Without this authority the formal structures will be like glue to hold people to their seats and stop them from being effective. In the BNZ when we wanted to free people we found that giving them a badge which said : “Just do it” was really important in making people feel that they had the power and authority to break free.

The form and substance of trust in an organisation is as palatable and influential on performance as a magnetic field is on a cluster of lime filings.

Companies can exert far greater control over their competitiveness and their future than most researchers have ever thought possible, by putting the right people in the right places and fostering new opportunities for them to talk to each other.

Value Statement are used to test all business decisions against. They also serve as a measure of acceptable behaviour and desired characteristics.

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