In times past, a “man’s word was as good as his bond.” Deals were made based on reputations and handshakes. Marriages were arranged by families – or at least introductions were made by mutual acquaintances.
With the proliferation of the Internet, an interesting paradox has emerged: we have become more interconnected, and at the same time, more isolated. The technology that enables us to transcend the limitations of time and space also limits our ability to judge a person’s character, evaluate his or her trustworthiness, or establish a long-term relationship. Yet we have become dependent on the technology for our social and commercial interactions.
Years ago, in his book Megatrends, Naisbitt (1982, pp. 43-44) identified this paradox as a “high-tech backlash." He suggested that “…when institutions introduce a new technology to customers or employees, they should build in a high-touch component; if they don’t, people will try to create their own or reject the new technology…. When high tech and high touch are out of balance … dissonance results.”
As a result, new business models have been emerging. In New Rules for a New Economy, Kelly (1998) foresaw the need for relationship technology that is applied towards forging -- and binding – the connections among individuals, and between individuals and organizations. He warned that (pp. 132-33): “The advent of relationships technologies on the net creates a larger role… None of this enlargement of relationships can happen unless there are vast amounts of trust all around… Trust is a peculiar quality… It can’t be instant – a startling fact in an instant culture… But it can disappear in a blink.”
Kelly goes on to say that trust cannot be purchased and has to accumulate slowly. Which takes us to another paradox: how can we accumulate trust slowly, yet have it instantly?
We find it helps to deconstruct -- i.e., "break down" trust. First, Hardin (2006, p. 1) distinguishes between the quality of trustworthiness and the expectation of trust: “To say that I trust you in some context is to say that I think you are or will be trustworthy toward me in that context. You might not be trustworthy toward others and you might not be trustworthy in other contexts.” So the key to engendering trust is to seem trustworthy.
Mayer et.al. (1995) present trustworthiness as a function of three broad factors: ability, benevolence, and integrity: “Ability is that group of skills, competencies, and characteristics that enable a party to have influence within some specific domain (p. 717)… Benevolence is the extent to which a trustee is believed to want to do good to the trustor, aside from an egocentric profit motive (p. 718)… Integrity involves the trustor’s perception that the trustee adheres to a set of principles that the trustor finds acceptable… the consistency of … past actions, credible communications, … a strong sense of justice, and the extent to which … actions are congruent with … words all affect the degree to which the [trustee] is perceived to have integrity (p. 719).”
In their view, trust is a function of these factors, moderated by the trustor’s propensity to trust. Elsewhere, this characteristic is referred to as “generalized” trust, relatively positive expectations of the trustworthiness, cooperativeness, or helpfulness of others (Hardin, 2006, p. 125). This factor becomes especially important in temporary relationships with time pressures, as might occur in Internet-based interactions.
Whether the trustor acts on this trust depends on one more factor, the perception of risk. Without risk, there is no need for trust. One does not need to risk anything to trust; however, one must take a risk in order to engage in trusting action (Mayer et.al., 1995, p. 724). Risk is a function of both the probability for failure and the cost of that failure. To reduce the perception of risk, the trustor might limit the exposure of failed expectations.
So what can you do to encourage your customers to trust you? There's not much you can do about someone's predisposition to trust (other than build a strong reputation and demonstrate reliability on a long term basis, which takes us back to the need for instantaneous trust).
Perceptions of risk can be managed with strong password enforcement, contractual specifications, and clear communications throughout the process of the transaction. The ability to do online chat during a transaction can mitigate someone's concern about placing an order during the transaction.
However, perceptions of trustworthiness (a function of ability, benevolence, and integrity are helped by soliciting and posting social media ratings of customer satisfaction (such as Amazon and ebay do for their third party vendors), using trusted conduits (such as PayPal ) to handle the monetary aspect of a transaction, gaining the endorsement of external agencies (such as Verisign). Perhaps most importantly, your customer service representatives can make or break this perception -- make sure they are well-trained and communicate clearly! The extent to which you can delegate the authority for them to resolve a problem upon contact will go a long way to demonstrating ability, benevolence and integrity.
As with many management principles, breaking down trust this way applies to individual relationships, person and professional. During this season of new year's resolutions, you may want to reflect on how you demonstrate your ability, benevolence and integrity. Happy New Year!
Blog excerpted from work previously published as:
Robert M. Easter and Linda L. Brennan. (2008). "Overcoming Hurdles to Trust: Infomediaries and Public Records," in Computer Mediated Communications and Trust: Organizational and Managerial Effects, L. Brennan, and V. Johnson, eds. Hershey, PA: IGP Press.
Hardin, R. (2006). Trust. United Kingdom: Polity.
Mayer, R.C., Davis, J.H., and Schoorman, F.D. (1995). An integrative model of organizational trust. Academy of Management Review, 20, 3, 709-734.
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