Customer trust is very important when it comes to building a reputation. In fact, without the trust of your company, there is no reputation. So how do you ensure that your company keeps the trust of your customers? Should you appoint a special person who is responsible for maintaining trust, as the writer of this article on Forbes argues? Do you need a Chief Reputation Officer on the board of your company?
My answer to that question is that you do not need that special person. So, I believe that you don’t need a Chief Reputation Officer. And I’ll explain why.
My reputation experience in the financial services industry
Let me give you some context first though. I’ve been working in the financial services industry for 20 years before starting my own business. As a result, I’ve experienced first-hand what it means to lose the trust of the customer. This happened, amongst others, during the financial crisis of 2008.
In the aftermath, the companies I worked for started focusing on fixing the issue by appointing extra compliance and risk employees. The philosophy was that if you put more control in place, people will start to behave. This did not work particularly well. Not least because in other areas of the company, employees were laid off.
More control is not equal to a better reputation.
So, instead of giving customer trust a boost because of increased attention, employees started to complain about the increased workload. They also complained about the fact that these compliance and risk departments were keeping them busy with other things than what they were hired to do (e.g. completing checklists, performing extra checks, etc.).
The thing is the following. Your employees have to feel that they have a role to play in managing the reputation of your company. Otherwise, they will do whatever they need to do to meet the other KPIs. And these KPIs are usually financially driven.
Worse, if employees don’t use their common sense when managing your reputation, the very people who were appointed to control them get the blame. The most prominent example of this is that Compliance Officers are blamed by regulators and the Justice department when other employees of the company are involved in the Money Laundering activities of customers.
Trust your employees to do the right thing
So how do you restore customer trust? Trust your employees to do the right thing for your customers. In the end, this trust will be repaid.
This also means not implementing additional rules. Rather it means that managers have to coach employees into applying the existing common sense-based rules that are already in place. In the last company I worked for, this was implemented as part of an accountability program.
As part of the program, no extra staff was hired. And no extra rules were implemented. Rather, employees were encouraged to take their own decisions. This meant that manager and employees had to accept that these could be wrong. If employees did take the wrong decisions, they were not punished. Rather asked to explain what went wrong and what they learned from it.
What about the results?
When I left the company, it was still too early to say something meaningful about the impact on financial results. But I did notice that employees were generally happier and more engaged. And studies have shown that more engaged employees will drive better business outcomes. Beter engagement also makes for a better customer experience. As a result, customer trust will increase doubling the return on your trust investment.