• September 8, 2023

Measuring trust, a key challenge for corporate India

Measuring trust, a key challenge for corporate India

Trust is unseen yet vital in business and relationships. It’s time to prioritize and measure trust for success.

Trust is an important element in all relationships, be it business or personal. Whilst trust is invisible like the air we breathe, the impact of its absence will be very significant. People continue to buy products or avail services of certain corporates beyond their value perception due to a number of other factors such as its brand, the corporate culture, the quality they deliver, the people who represent the organisation, the customer experience — the list goes on.

We can collectively call all these factors as trust. In many cases, customers are willing to put in the extra premium for the entities they trust even though the competitor may offer a similar product or service at a much lesser price. Why?

Trust, taken for granted?

Often, we make the mistake of taking certain things, which are so critical for success, for granted without giving them due importance. In the VUCA world, it is the right time now for Indian corporates to go back to basics and relook at the fundamentals and our core values. The outcome of any such exercise, ultimately, will narrow down to the single element of “trust” which needs to be nurtured and nourished.

Have you heard of things that nobody really notices in detail, but when it’s absent, everybody notices? Trust is one such thing that is vital for the success of businesses. It’s a magical element; when its level rises, people surpass their preconceived boundaries, uncovering new and splendid abilities they were previously unaware of. If trust commands that level of importance, the natural next question would be — how to build trust? How to measure trust? How to monitor the movement in the trust quotient? Is there a method to gauge the magnitude of something so significant yet imperceptible?

Tailoring the trust

Now, the subsequent query emerges concerning its global characterisation and the establishment of a robust framework for measurement and oversight. The factors that an individual considers as important for trusting someone could be totally different from the factors relevant to another individual. Under these circumstances, how do we identify a common link for defining and measuring the trust for corporates where everything is unique and complex in its own way? This has led to a situation where all businesses would unanimously agree on the importance of trust but in the absence of clarity and consistency in its measurement, there is an apprehension of inherent subjectivity in the evaluation mechanism and its effectiveness. What is needed is a framework that would not just measure but provide a path for implementation of the related initiatives.

Thanks to the extensive research carried out by various eminent institutions, two factors emerge as strong contributors to the trust, namely, competence and intent. The culmination of this would ultimately result in demonstrated capability, reliability, transparency, and humanity. If a framework can be designed to measure the above four pillars of trust, that would cut across the varying definitions of trust as a common standardised yardstick.

Techniques of measuring trust

Any enterprise trust assessment ideally would involve two critical segments — external and internal. There was a view earlier that trust assessment from the external lens is the most critical rather than internal. However, now, corporates have very clearly understood that if you don’t have trust inside your company, then you can’t transfer it to your external stakeholders and customers. So, the trust assessment for an entity could start internally and expand to the external stakeholders. This could be benchmarked with industry peers and the priority actions could be identified.

Do it now

Several large companies worldwide have already embarked on a journey of setting up a specialised team under the leadership of Chief Trust Officer to provide trust insights to the leadership for leveraging trust and reaping the benefits. It is the right time now for Indian corporates to shift gears and look at the big picture beyond financial metrics and explore the newer areas for nurturing, measuring, and monitoring the qualitative trust bonding signals with its stakeholders for long-term success.

Authored by Sriraman Parthasarathy. The writer is Partner, Deloitte Touche Tohmatsu India LLP.

Leave a Reply

Your email address will not be published. Required fields are marked *