Monday, February 8, 2016

How Trust Affects Businesses in Asia


Trust globally has eroded over the past few years. Businesses from a variety of industries have sought to crawl back to regain trust from all those that matter. Especially in light of recent events and incidents relating to privacy and security.

I recently came across a nice set of Trust Rules written by KPMG and another 2015 Edelman Trust Barometer which dives into this topic of Trust. It is seen more in the corporate lens, but nonetheless, a great way to frame your thoughts on Trust in today's context especially for those eager to do live and business in Asia.

Their studies explores the concept of the role of trust not only in the traditional corporate relationships but also how it can affect innovation. So re-estabishing genuine and authentic trust will be the pathway to innovate.

It's really about bringing the human relationships back to business, which I often see through the concept of Inbound.
Wise men put their trust in ideas and not in circumstances

Western definition of trust does not have the same meaning as Asian cultural context

Within the Asian context, trust has always played an important role in relationships.

Western definition of trust does not have the same meaning as Asian cultural context. The concept of trust often implies competency, meeting expectations, goodwill and to a deeper level, necessitates a qualitative connection.

According to a 2010 University of Wollongong research paper on the subject of trust, findings state that deep trust (a word which translates into "xinren" in the Chinese language) is characterised by reciprocal help and emotional bonding. The paper suggests that trust is critical for doing business in China.

Please feel free to explore more details directly from their ongoing studies, but here's a high level overview of their frameworks for those keen to explore further.

KPMG defined the Nine Rules of Trust as follows:

KPMG's Nine Rules of Trust

  • Mark contact personal
  • Define common goals
  • Set the right example
  • Build trust with sensible rules
  • Share responsibility and trust
  • Keep calm when things go wrong
  • Rely on informed trust, not on blind trust
  • Be mild on understanding but crush abuse
  • Dare to experiment and learn from experience

Edelman's Trust Barometer measures

  • Integrity (e.g. are businesses practices ethical)
  • Engagement  (e.g. is there open communication between businesses and their customers)
  • Products and Services (e.g. is the company able to innovate new products and services)
  • Purpose (e.g. is there a tangible commitment to improve the lives of the communities within which the business operates)
  • Operations (e.g. is the company recognised and ranked in this industry in which it operates)

Trust is the glue which holds businesses and societies together. Without trust, there is no motivation and therefore no leadership. Without leadership we will not overcome challenges.
I hope this is great food for thought, and gets you thinking about how you can frame the trust relationships around you.