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Post: Why Employees and Customers Are Walking Away: The Critical Role of Trust
The Real Reason Employees and Customers Are Walking Away: Building Trust is Essential
Everything of value is built on trust. It is the foundation upon which all great leaders, organizations, and brands are built. You’ll pay more for the trusted brand, follow the trusted leader, and buy from the trusted salesperson. Trust is not only the glue that holds relationships together but the single most important factor that differentiates successful organizations from struggling ones. Trust has become the currency of modern leadership and commerce, and it is indispensable for any lasting success.
This bold statement should make leaders stop and think: What if our employees and customers don’t trust us? What if that trust is eroding without us even realizing it? These are critical questions, as a lack of trust is perhaps the biggest hidden cost facing organizations today. When trust is broken, customers stop buying, employees stop caring, and relationships deteriorate.
In the following sections, we will explore how trust affects organizations, why it is so critical, and what can be done to bridge the trust gap between executives, employees, and customers. We will draw from the findings of PwC’s 2024 Trust Survey, which highlights the power of trust in today’s business environment and provides essential insights for leaders to act on.
The Business Case for Trust
According to PwC’s 2024 Trust Survey, 93% of business executives agree (including 46% who “strongly agree”) that building and maintaining trust improves the bottom line. This overwhelming consensus speaks volumes about the importance of trust in driving business success. It’s not just a nice-to-have; it’s a necessity.
Without trust, everything becomes more expensive and difficult. You’ll spend more time trying to gain buy-in from employees, convincing customers of your value, and repairing broken relationships. In contrast, when trust is high, business operations are smoother, decision-making is faster, and your bottom line is stronger.
One key takeaway from this finding is that business leaders must consistently ask themselves what they are doing to build trust with both customers and employees. It’s not enough to assume that trust exists. Leaders must actively cultivate trust by ensuring transparency, delivering on promises, and fostering an environment where both employees and customers feel valued and heard.
Trust as a Competitive Advantage
Trust is a competitive advantage that separates industry leaders from the rest of the pack. Companies like Amazon, Netflix, and PayPal didn’t just rise to the top by having great products—they built a solid foundation of trust. Customers feel confident buying from them because they know these companies deliver on their promises. This trust translates into higher customer loyalty, larger market share, and greater profitability.
So, how do companies build and maintain this level of trust? It starts with a commitment to integrity and customer satisfaction. Leaders who foster an environment of trust do so by being transparent in their communications, consistent in their actions, and reliable in fulfilling their promises. These companies do not take shortcuts when it comes to delivering value, and as a result, they earn the trust of their stakeholders.
The Trust Gap: Executive Perceptions vs. Reality
One of the most significant findings in PwC’s survey is the wide gap between how much trust executives believe exists and how much trust is actually felt by employees and customers.
- 86% of executives say they highly trust their employees, but only 60% of employees feel highly trusted.
- 90% of executives think their customers highly trust their companies, but only 30% of consumers actually do.
These statistics should be a wake-up call for leaders. If executives believe there is high trust when there isn’t, this disconnect can create serious problems within an organization.
The Employee Trust Gap
Employees are the backbone of any organization. When they feel trusted and empowered, they are more engaged, more productive, and more likely to stay with the company. Yet, the survey reveals a troubling disconnect: While 86% of executives claim to highly trust their employees, only 60% of employees feel that trust.
This gap may be the result of micromanagement and a lack of empowerment. Employees who feel micromanaged often lose confidence in their abilities and become disengaged from their work. This leads to lower productivity, higher turnover rates, and ultimately a negative impact on the company’s bottom line.
To close this gap, leaders must create a culture of trust and empowerment. This involves hiring talented individuals, giving them the training they need to succeed, and then stepping back to allow them to do their jobs. Micromanaging not only diminishes employee morale but also conveys a lack of trust. On the other hand, empowering employees shows that you believe in their abilities, which in turn increases their loyalty to the company and their willingness to go above and beyond for its success.
The Customer Trust Gap
Even more concerning is the trust gap between companies and their customers. While 90% of executives think their customers highly trust their companies, only 30% of consumers actually do. This 60% gap represents a significant misalignment and a growing trend in the wrong direction. A lack of trust from customers can be detrimental to any business, as it directly impacts sales, customer retention, and overall brand reputation.
This gap may stem from companies overestimating how their customers perceive their efforts. While organizations may believe they are delivering value, customers may feel differently due to poor customer service, lack of transparency, or unmet expectations. It’s crucial for companies to realize that it’s not what they think that matters—it’s what their customers think. Customer perception is reality, and if the trust is not there, the company will struggle to maintain its market position.
Fixing the Trust Problem
So, how can organizations begin to address these trust gaps? The key lies in making trust-building a priority for both employees and customers. Let’s explore the specific steps that leaders can take to foster trust within their organizations and with their customer base.
1. Focus on Employee Empowerment
Trust starts from within. Employees are more likely to trust their leaders if they feel empowered to make decisions and contribute to the company’s success. Micromanagement breeds distrust, while empowerment fosters loyalty. Leaders should ask themselves:
- Do your employees feel micromanaged? If the answer is yes, it’s time to shift the focus from controlling every aspect of their work to empowering them to take ownership of their responsibilities.
- Do your employees feel valued and trusted? Recognition and praise for a job well done go a long way toward building trust. Leaders must show appreciation for their employees’ contributions, reinforcing the idea that they are trusted members of the team.
2. Prioritize Transparent Communication
Transparency is non-negotiable when it comes to building trust. Employees and customers alike need to know that they can rely on leaders to be honest and open, especially in times of crisis or uncertainty. Leaders must:
- Be open about company challenges and successes. Employees and customers appreciate honesty, even when the news isn’t positive. When leaders are transparent, they demonstrate integrity and earn the trust of those they lead.
- Deliver on promises. Whether it’s a commitment to improving workplace culture or enhancing customer service, leaders must follow through on their promises. Broken promises quickly erode trust and damage relationships.
3. Enhance Customer Experience
Customer trust is directly linked to the quality of the customer experience. Our annual CX research, sponsored by RingCentral, found that 87% of U.S. consumers in 2024 said that great customer service increases their trust in a company. This shows that investing in customer service is one of the most effective ways to build trust with your customers.
Companies can enhance customer experience by:
- Focusing on personalized service. Customers want to feel valued and understood. Personalized interactions that cater to their unique needs and preferences build trust and loyalty.
- Making it easy to do business. Frictionless customer service, intuitive interfaces, and responsive support teams all contribute to a positive customer experience. When customers feel that their needs are prioritized, trust is established.
4. Build a Culture of Trust from the Top
Leaders set the tone for an organization’s culture. If leaders embody trustworthiness, transparency, and reliability, their teams will follow suit. To build a culture of trust:
- Model the behavior you expect. Leaders must act with integrity, admit mistakes, and be transparent in their decision-making processes. When employees see that their leaders are trustworthy, they are more likely to exhibit the same behaviors.
- Create a safe space for feedback. Employees and customers alike need to feel that their opinions are valued. By fostering an environment where feedback is welcomed and acted upon, leaders demonstrate that they trust and respect their stakeholders.
Conclusion: Trust is the Foundation of Success
David Horsager’s statement that “everything of value is built on trust” is not an exaggeration. Trust is the bedrock upon which all successful relationships are built—whether with employees, customers, or other stakeholders. When trust is present, organizations thrive. When it is absent, they falter.
The findings from PwC’s 2024 Trust Survey serve as a stark reminder that trust cannot be assumed—it must be earned. The trust gap between executives, employees, and customers is real, and it is a significant threat to organizational success. Leaders must prioritize trust-building efforts, focusing on employee empowerment, transparent communication, and enhanced customer experiences.
If your organization has discrepancies between leadership’s perception of trust and the trust levels felt by employees and customers, there is work to do. Bridging the trust gap should be a top priority because without trust, you are not only jeopardizing relationships—you are hurting your bottom line.
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About the Author: Bernard Aybout (Virii8)
