Maintaining organisational trust within a business is as important as organisational trust without

Several articles on Turnaround Talk point out that, while there are many root causes of financial distress, mismanagement is most often the chief contributor. These articles are also written from the perspective of the trust ecosystem being destroyed from a shareholder’s (creditors) or the public’s point of view.

But what happens to the organisational trust deficit when employees discover the company is mismanaged? A common reaction to mismanagement/decreased profitability is monitoring employees’ productivity to determine improvements. This, unfortunately, opens a whole new can of worms.

Good intentions, poor outcomes

The article points out that workplace monitoring tools—and the policies and processes they support—appear to be evolving in a dystopian direction. From manufacturing and frontline workers to information and knowledge professionals and even managers and executives, technology is enabling a new era of monitoring and micromanagement for them. Initial hopes that this technology would encourage productivity improvement, foster well-being, and improve job quality have given way to fears that it appears to drive us toward an unhappy and unproductive future of bad jobs. Quiet quitting (where disgruntled employees restrict their daily work to only the tasks listed in their job descriptions, arriving at work on time but departing the minute the workday ends) has gone from an oddity to a distinct trend. On the other hand, loud quitting (where workers are actively disengaged and may work to undermine employers’ goals) is on the rise. Disillusioned workers might even turn to over-employment, simultaneously holding down two or more full-time jobs, as they find gaming the system more rewarding than investing themselves and their career in one workplace.

Yet, there is nothing inevitable about a dystopian technological future. How the technologies at our disposal are approached is often more important than the particular technologies used. There’s a material difference, for example, between a mortar and pestle used to pound basil, pine nuts, and olive oil to make pesto for a friendly dinner party and a Roman slave using the same technology to pound meat all day in preparation for a party. Similarly, a smartphone can be used strategically to enhance and uplift productivity, or it may be used in a less purposeful and distracting manner, losing time passively scrolling through social media or playing games that affect one’s overall well-being. A helpful shorthand is to think of technology not as a thing but as a form of human action. New technology creates new opportunities, but how these opportunities are used determines if the technology will be liberating or oppressive.

The article adds that it’s not that the executives and managers designing these work systems necessarily have bad intentions. Systemic dysfunction is often the unintended consequence of many otherwise well-meaning decisions. The purpose is likely to foster the adoption of more productive and healthy work habits by providing workers with data on where they invest their time (rather than where they think they invest it) and enabling them to compare themselves and their work habits with their peers. This emphasis on quantifying organisational performance could be seen as a riff on the quantified self-movement—an aspiration that “self-knowledge through numbers” will enable us to improve ourselves and our work.

But what started as a project to provide workers with fine-grained activity data to help them improve their performance has resulted in that data being used to drive performance management and remuneration processes over which the worker has little (if any) influence. Workers are beholden to workplace monitoring software, their day divided into even-thinner slices, with each slice individually accounted for (and renumerated).

The article points out that, despite this, few executives have paid products like mouse jigglers much attention. Stories of quiet quitting or productivity theatre are assumed to only apply to other organisations (not their own) with higher-than-usual levels of productivity paranoia. This is not necessarily the case. It can be difficult, if not impossible, to appreciate what it’s like to work in a quantified organisation without experiencing it for oneself. There’s a fine line between providing workers with tools to improve their productivity and creating an overbearing work environment that drives them to productivity theatre. Often, it takes a personal connection—a conversation with a family member using a mouse jiggler, for example—before an executive realises that the experience of those working in their carefully designed quantified organisation might make workers less productive and more distrustful of the organisation.

Organisational trust is in trouble

The root of the problem is that well-meaning leaders, executives who likely trust individual workers, don’t trust “workers” as a group. When making operational decisions or designing new policies and processes, leaders often treat workers like naughty children to be kept in line, regardless of their trust in individual workers. Their focus then naturally tends toward monitoring and compliance and yields policies and processes that indicate distrust in workers, eroding workers’ trust in the organisation. Workers feel disempowered and micromanaged and respond with compensating actions that create the illusion of productivity at the cost of real productivity.

The article adds that 80% of employees who have high levels of trust in their employers feel motivated to work, versus less than 30% of those who don’t. But less than half of workers say they trust their employer.

Much has been written about the importance of trust in the workplace. Worker trust in the organisation and management is associated with more productive and happier workers. Trust strengthens organisations while reducing turnover and improving engagement and is correlated with superior productivity and job quality.

Trust’s importance in the workplace has grown as work has become less transactional and task-based and more reliant on collaboration, working in teams, and creativity. Psychological safety, for example, is essential to creativity and working digitally and is closely related to trust.

The article points out that organisations commonly only consider one aspect of trust: trust as an interpersonal phenomenon, the relationship between a worker and a manager. Consequently, diagnosing a lack of trust often results in efforts to foster trust by encouraging and training managers and executives to behave trustworthyly: demonstrating empathy and kindness toward employees, communicating straightforwardly, and consistently and dependably delivering on commitments made to employees.

What has been missing is an acknowledgement that workers don’t only trust their managers as individuals but as extensions of the organisation they represent. Trust is both contextual and collective. An employee may trust their manager as an individual, for example, while not trusting them in their role as a manager. Similarly, a manager may trust a particular worker as an individual while distrusting “workers” as a group. It’s difficult for workers to separate their experience with workplace monitoring solutions from the context of interactions with their manager.

What’s more, a worker’s trust is also informed by the collective experiences of their colleagues. The article adds that many interactions workers have with their manager (and the larger organisation) involve their whole team and not just themselves as individuals. Workplace monitoring needs only impact a colleague, rather than the worker directly, for the worker’s trust in the firm and their manager to be affected. The challenging conversation of pay transparency is a case in point, with perceptions of inequitable treatment quickly leading to discontent. Workers respond by collectively developing and adopting behaviours to mitigate or otherwise compensate for what they see as excessive workplace monitoring or other impositions. Using a mouse jiggler is an adaptive behaviour that can quickly spread across a workplace. Like speeding, what is seen as a modest transgression—rule-breaking with a small “r”—is easily justified when “everyone is doing it.”

Compensating behaviours trade actual productivity for perceived productivity—gaming workplace monitoring at the expense of getting work done. In one example of this, hospice chaplains tweaked their schedules to ensure that they regularly engaged in “spiritual care drive-bys” to game productivity metrics, investing time in an activity that was periodically monitored while neglecting other responsibilities that weren’t

What is the actual cause of financial distress?

It is important to note that while products and services are the lifeblood of a company, employees are its beating heart.

Therefore, is mismanagement the act of mismanaging the company by the C Suite, or does mismanagement lie in the inability to manage employees when they disagree with the decisions being made above them regarding the running of the company? Perhaps mismanagement is a combination of the two.

While risk management and product/service development are significant, business leaders must also be effective people managers. Getting employees on board and keeping them motivated to accomplish the task at hand is more critical during financial distress than during prosperity and record performances.