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The Biggest Obstacle Facing Leaders Is Distrust. Here's How to Build Confidence in Your Team. Trusting others can be difficult when it comes to something as important as your business, but the cost of distrust is far too high.

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As the recent health crisis tested businesses across the globe, people seized the opportunity to become entrepreneurs and take control of their careers. According to the U.S. Census Bureau, as reported by NPR, 5.4 million new business applications were filed in 2021. And in the first half of 2022, new business applications were 23% higher than pre-pandemic levels, according to the Economic Innovation Group. Instead of relying on their employers to provide security, millions of new business owners sought the ability to run their teams and call the shots in an environment where control was elusive.

This rise in entrepreneurship also highlighted another phenomenon: general distrust in the workforce.

One of the most essential things you understand as an entrepreneur is that if it weren't for you, your business would not exist. This certainty, coupled with the doubts and insecurity bred by the recent health crisis, has probably made it challenging for you and many other leaders to have confidence in the future. After all, the ability to take risks and make bold decisions for your business hinges on trust. Without it, your business would fail.

Specifically, a lack of trust in your workforce hampers productivity and retention and increases costs. How? Distrust stops progress because it incapacitates even your best employees each day. When employees aren't encouraged or given a sense of autonomy, they tend to quit, leaving you without your most critical asset: people. Leading with trust is crucial to retaining employees and moving your business forward. Though trusting others can be difficult, especially when it comes to your business, the cost of distrust is far too high.

Related: 3 Tips to Build Trust and Drive Business Transformation

The importance of trusting others in business

Let's face it — your business is like your baby. Just like you wouldn't trust your baby with anyone, you probably wouldn't trust your business with just anyone, either. After all, you had an idea, you worked hard, and you turned it into a business. So, it's difficult to let go and let other people work for you and take on more responsibility, which makes it tempting to micromanage. However, when you micromanage your workforce, you are saying loud and clear that your employees' ideas and contributions aren't good enough. As a result, bureaucracy increases, and employee morale decreases.

A recent article by Forbes revealed that as many as 79% percent of employees had experienced micromanagement. This translates to a lot of leaders leaning into bureaucracy rather than trust. How do you become a bureaucratic leader? If you are guilty of micromanaging your team, you've likely experienced employee hierarchies and restrictive policies in the past. As a result, you think that if others did it, it must work. Unfortunately, distrust and micromanagement create silos that hinder communication and bring organizations down.

If you're one of the millions of leaders who tend to tighten the controls instead of letting go, you might be doing more harm than you realize. During the height of the Great Resignation in 2021, 47 million people quit their jobs, according to CNN Business. The phenomenon is still going on, with 4 million Americans quitting in November 2022, per the latest numbers from the U.S. Bureau of Labor Statistics. According to Pew Research Center, many left their jobs for better opportunities, increased pay and more respect. Micromanagement (even if it's unintentional) is the ultimate form of disrespect and, as a result, can increase turnover and make it more challenging to hire people. This disrupts your organizational structure and can cause your chain of command to fluctuate constantly and eventually fall apart.

How to lead with trust

Distrust is easy to fall into for many entrepreneurs, but it is possible to let go and create a culture of trust even if you are struggling with trust issues. For example, many leaders have forced employees to "earn" the right to work from home. However, the only message this sends to team members is, "We don't trust you." A better approach would mirror that of 3M, which implemented a "Work Your Way" program that enables employees to return to the office, adopt a hybrid schedule or work entirely remotely.

As you can see, trusting the people who make up your company is essential. Here are three ways you can build trust in your organization to avoid trust-related pitfalls:

Related: 12 Trust-Destroyers, and How to Avoid Them

1. Hire people you trust

First things first, only hire people you can trust to be on your team. Right now, you probably devote more of your time assessing hard skills and experience in the hiring process. However, there are ways to gauge behavioral and character fitness as well. When searching for talent, spend equal time measuring skills and character to increase trust and reduce turnover in the long run. Upwork is a good example of a company that trusts its team. Leaders allowed employees to work from home during the pandemic due to safety issues and because the company trusted its personnel.

2. Examine your assumptions

If you tend to make assumptions about people, maybe it's time to ask why. When it comes to your business, it's easy to assume that people who work for you only want to take advantage of you or benefit themselves. Instead of jumping to conclusions, take a step back and evaluate situations individually. Just as you wouldn't make assumptions about your business, don't paint people with a broad brush.

Many leaders hold their team members at arm's length to keep the relationship professional. However, this is not the best approach to building trust. As a leader, you can strike a balance so that your team members can trust you enough to communicate any issues openly. This will help you boost engagement, improve retention and create a more trusting environment in the long term.

Related: Why Everything You Know About Employee Engagement Is Wrong

3. Clarify your expectations

Everyone on your team is only human, which means they can't read your mind. That's why it's crucial to clarify your expectations of your team early on and to understand your team members' expectations. You instantly improve communication and morale when you have an upfront conversation about expectations right out of the gate. This sets the foundation for robust and trusting work relationships.

Although it's hard to "let go" of your business, trust is vital to moving your company forward. Without trust, you risk losing people and productivity. When you feel the need to micromanage, remember that you hired your team members for a reason. Avoid micromanagement, and you will likely see a happier, healthier and more productive workforce.

Gloria St. Martin-Lowry

Entrepreneur Leadership Network® Contributor

President of HPWP Group

Gloria St. Martin-Lowry is the president of HPWP Group, a company that promotes leadership and organizational development through positivity, coaching and problem-solving. HPWP is driven to create high-performing workplaces by partnering with courageous leaders who value team members’ contributions.

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