Authors: Roderick Kramer (Stanford University)
Publication: Harvard Business Review
Focus Area: Decision Making, Emotion, Prevention Techniques, Consumer Behavior
Relevance: Fraudsters prey on humans’ natural inclination to trust in others. Establishing guidelines for safe establishment of trust — rather than operating by easily-faked rules such as friendliness, class, or social standing — may help guard against predatory ploys.
Summary: While trust is necessary and useful, our process of giving and receiving trust is often superficial and flawed. This article outlines recent research on the subject and summarizes findings into practical guidelines. These principles (below) include insights for both individuals and organizations.
- Know yourself: Establishing oneself as either generally trusting or distrusting can help one guard against the weaknesses of each tendency.
- Start small: Incremental steps in establishing trust are more reliable and long-lasting than simply placing trust wholly with a new individual or company.
- Write an escape clause: Hedging the risk of trust with a back-up plan both guards against mistakes in judgment and allows people to trust more fully.
- Send strong signals: Strong, quick and proportional retaliation to violations of trust is as vital for the protection against predatory individuals as open sharing is to the establishment of trusting relationships.
- Recognize the other person’s dilemma: To foster trust, understanding other people’s need for reinforcement is important for establishing a mutually solid, trusting relationship.
- Look at roles as well as people: It is easier for someone to trust a person in a position that inherently evokes trust — such as an engineer or investment advisor. This tendency can be misleading, causing one to see the role and forget the people.
- Remain vigilant and always question: By continuing to evaluate the relationships in which we place trust, we are more likely to perceive changes (such as a shift in an investment advisor’s reporting) that indicate a breach of trust.
Author Abstract: For the past two decades, trust has been touted as the all-powerful lubricant that keeps the economic wheels turning and greases the right connections—all to our collective benefit. Popular business books proclaim the power and virtue of trust. Academics have enthusiastically piled up study after study showing the varied benefits of trust, especially when it is based on a clear track record, credible expertise, and prominence in the right networks.