I realise that by taking on this topic in the start of my blogging career, I'm probably jumping into the deep end, but hey, this is how I learnt to swim when I was 5 years old, so here we go.
Now you might ask what trust has to do with the bottom line. Well, I believe it has everything to do with the bottom line! You see, in the world of P&L's, income statements and balance sheets, while the financial performance of businesses are the facts and instruments on which decisions are being made at a board and executive level, these documents don't actually contain the factual information of the operational engine generating those numbers. Rather, they reflect the results of the performance of that engine and therefore convey very little about the actual challenges and reasons why businesses do well, or poorly for that matter. Yet, I have been guilty of making operational decisions, and not just financial decisions based on these results, as I'm sure many other's have done. Don't get me wrong, I believe the time calls when the tough decisions have to be made to downsize, close a business unit, or worse case, liquidate a business (the latter which I have luckily not experienced), but it should not be the only facts which are considered when making decisions as a business leader.
I want to take one step back and look at the word "fact(s)", defined as "information used as evidence or as part of a report or news article". I don't think anyone will argue when I say that income statements and balance sheets are true facts, we even have audit firms which are paid lots of money to confirm and approve these facts. These are factual numbers, empirical and scientific information providing the business leadership with valuable data to make financial decisions on, yet, when it comes to managing and running our businesses we rely on our judgement and many times on people's opinions when making decisions on operational processes, organisational structuring, appointing and firing staff. Sometimes we have to do this due to a lack of data, of factual information that provides clarity and a clear black or white answer. We therefore rely on people closer to the situation to provide "input" (opinion) and help with "perspective" (perception).
Now you would argue that no single business person can know everything and be able to always make decisions based on factual information as it's not always possible to get the facts; but I want to argue that we can get close... and that is by building a culture of trust across all levels of the organisation, starting at the top.
More on trust in the next post...
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