Every deal and and business decision we make relies on trust; without trust, we can’t rely on others to keep their side of the bargain, and so trust lies right at the heart of all business practices.
Trust is a very human trait. Outside of Homo Sapiens, other animals find it very difficult to ‘trust’ other members of their species outside of their family structure. This is due to two assets of the mind that are unique to humans: theory of mind and empathy, one resulting from the other.
Theory of mind is the ability to place oneself ‘inside’ the mind of another so that we might predict their behaviour based on what we know about them and what knowledge they posses. Empathy is the ability to understand the emotional state of another person based on personal experience in a similar situation. These two traits are unique to humans and have allowed us to elevate ourselves above all other animals due to our incredibly complex and effective social structures that, at their foundation, are built on trust.
Oxytocin is the key hormone involved in trusting relationships. Oxytocin arises when your brain feels it’s making a strong connection with another person, such as when we co-operate well on a team project. It lowers feelings of social anxiety and motivates us to co-operate with others by regulating the brain’s supply of dopamine. The more oxytocin your brain produces, the more empathetic you feel, and the more trusting you become. A good workplace will try to foster this kind of behaviour by encouraging teamwork and the sharing of ideas. Equally, by treating customers and clients as collaborators, rather than dollar signs, you will build a more trusting and natural business relationship that is more likely to lead to mutual success.
Oxytocin levels and, consequently, trust, are noticeably lowered by fear and the perceived threat of social embarrassment. If a manager rules as a tyrant over their staff, their team will not trust them, similar to how a business that doesn’t treat its customers with any respect will quickly lose them. When one is in a position of power, testosterone floods the body, which can lead to brash decision making and, in extreme cases, a disregard for the feelings of others. Keeping a close eye on how hierarchies present themselves in the workplace can be key to a trusting staff and customer base.
All of our deals rely on trust. Every failed deal can usually be put down to a lack of trust between those parties involved, whether that’s a buyer not trusting a future sales pipeline, a funder not trusting the management team, or a vendor not trusting the buyer.
Our key role in preparing a business for sale is to look at how we can enable trust to build between all parties through proper preparation, honest feedback and open lines of communication. Be wary of the effects of hormones in the workplace, how they are regulated might just be the difference between a successful deal and a failed one.
Trust is an essential ingredient for effective leadership and teamwork, great customer service, and achieving satisfaction from one’s work. The payoff goes to both the top and bottom lines