GUEST AUTHOR BLOG: "The Good News about Greg Smith’s New York Times resignation letter from Goldman Sachs" by Greg Link co-author of "Smart Trust: Creating Posperity, Energy, and Joy in a Low-Trust World."
Greg Smith’s resignation letterfrom Goldman Sachs published in The New York Times has happily opened a dialogue about the significance of trust in the workplace—whether toxic, transformational, or somewhere in between.
It draws attention to the disparity in perception by various stakeholders of the observable behavior of organizations. This disparity is caused by each stakeholder having a unique view of an organization’s level of trust based on their specific experience.
For example, while Smith illuminates many egregious signs of a toxic low trust culture, Goldman’s defenders point out that the sophisticated customers of Goldman are not naive neophytes. They must trust the benefits of Goldman’s expertise and feel their direct experience of the way they are treated is acceptable. They do not see the behind-the-scenes disrespect of an overzealous sales force abusing customers described by Smith. They experience the self-serving coddling of sales people determined to make another sale. Smith’s alleged breach of trust by selling products known to not be in the customers best interest is invisible to the customer--in the SHORT run.
In the LONG run, the financial results will expose the risk and poor quality of the financial product, but losses alone still may not reveal the underlying motives and alleged deliberate intent of the individual sales people or, much worse, the intentional abuse by the organization at large.
Fortunately for the rest of us, this wake-up call by the power of the media actualized by Smith in his New York Times Op-Ed is more and more being amplified by, and in some cases replaced by, new media. The instant communication of social media holds organizations accountable for their actions as they risk triggering their own cultural “Arab Spring” if they continue to take advantage of stakeholders. Sweeping bad behavior under the rug and keeping it secret is less of an option today than it was in the now obsolete command and control leadership style of the past.
The power of public exposure in Goldman’s case is illuminated by customer reputation scores, which are lower than in the depths of the financial crisis according to YouGov BrandIndex – an organization that measures brand perception. Whether or not Smith’s perception of the Goldman culture proves this toxic behavior to be sanctioned by higher ups and thus represents the intentions and motives of Goldman’s leadership or not, when it comes to trust, perception is everything. We judge ourselves by our well-meaning intentions but judge others by their observable behavior.
We may have higher expectations of ethical high-trust behavior in the financial services sector, but Smith’s letter is a clarion call for higher trust standards that is reverberating in all industries. Research shows that high-trust organizations outperform the market in total return to shareholders by three times. Ultimately, our behavior tends to “follow the money”. Increasingly informed customers are raising their expectations of transparency, and are voting with their wallet by taking their business to higher trust enterprises. This renaissance of trust is healthy, and it is my hope that this rising tide will raise all boats.
Leaders must realize that they are no longer judged and promoted by simply getting results. If they get the deal but don’t get the trust, the value of the deal is significantly diminished. They must learn to get results in ways that inspire trust with all stakeholders for the next time, and there is always a next time.
Greg Link is the co author of "Smart Trust: Creating Prosperity, Energy, and Joy in a Low-Trust World." Greg Link is Co-founder and President of CoveyLink Worldwide, a fast-growing boutique consultancy committed to influencing influencers to grow their careers and their organizations at the SPEED of TRUST™. A recognized authority on leadership, sales, and marketing, Link is a sought-after advisor and speaker. His authentic and engaging style endears him to audiences of all roles, from senior executives to the front lines. His unique distinction is that he is a “businessman who speaks” not a “speaker that merely theorizes and assumes.”