Getty Images/Alistair Berg

Getty Images/Alistair Berg

Research shows that trust within an organisation is critically important for successfully navigating crises and disruption. Management expert from The University of Queensland Business School, Professor Nicole Gillespie, shares insights on how leaders can maintain employee trust during the current COVID-19 crises, drawing lessons from her research on organisations that successfully preserved trust during the 2008 Global Financial Crisis (GFC).


The word “trust” gets bandied about a lot: trusted brands, trusted providers, trusted by customers. However, the same prominence is not always given to internal organisational trust. Yet, as 2020 has demonstrated, it’s absolutely vital to build and sustain trust within an organisation during times of crisis and disruption.

The ongoing COVID-19 crisis has forced business leaders, employers and policymakers to make rapid and large-scale changes to their organisations to meet stakeholders’ needs and stay financially viable. Many leaders have been forced to make tough decisions such as reducing pay, limiting work hours, laying off workers or ‘standing down’ employees on JobKeeper pay with no defined return to work date.

It is during these heightened periods of crisis and disruption when organisational trust is most needed. However, it’s also at this time that trust is most under threat.

In Australia alone, unemployment rates have reached a 22-year high due to the economic fallout of the pandemic, and those who have kept their jobs in varied capacities are feeling the strain of an uncertain and unpredictable future.

My research shows that the uncertainty and unpredictability of a crisis serves as a jolt to employees; disrupting what is familiar to them and heightening their sense of vulnerability. In this context, employees need reassurance that their continual trust in their employer is warranted.

Faced with this fracturing of organisational relationships, leaders and policymakers are left to grapple with a serious question: How can leaders preserve employee trust during crises and disruptions? 

Fortunately, valuable lessons can be learnt from how organisations navigated the Global Financial Crisis. Research I led with a team of international trust experts, examined four organisations that experienced major disruption during the GFC, to understand the practices they used to successfully preserve trust.

We discovered through these in-depth studies that employee trust could not only be preserved, but even enhanced during times of crisis.

The key to this success is for organisations to proactively and consistently engage in three distinct practices. Employing these strategies reassures employees of their organisation’s ongoing trustworthiness in response to the crisis and reduces their associated feelings of uncertainty and vulnerability.

Getty Images/Klaus Vedfelt

Business people standing in front of a black and white wave.
Business people standing in front of a wave.
Group of people presenting at a conference.

Getty Images/Luis Alvarez

Getty Images/Luis Alvarez

Man raising his hand to ask a question at a conference

Getty Images/Luis Alvarez

Getty Images/Luis Alvarez

1. Build a bridge to the future founded on
core values and purpose

The first step towards reducing employee uncertainty is to develop a shared understanding of how the organisation will navigate a crisis. This involves openly and honestly communicating with employees about how a crisis is affecting the organisation. Leaders need to communicate the changes and priorities required to overcome these challenges, and how these changes will reinforce and protect the organisation’s established values and purpose.

Drawing on familiar and established foundations of trust within the organisation further helps reduce employee uncertainty. These trust foundations are unique to each organisation and can include the values, shared purpose, relationships, practices, structures and processes that built and sustained trust before the crisis.

For example, in one UK manufacturing business we studied, employee trust is largely based on strong relationships, transparency and communication between line managers, workers and trade unions. Recognising this, senior management worked directly with affected plants and the unions when planning, announcing and implementing changes right down to a local level.

As one employee described, communication was “more frequent so that people were aware it was changing and therefore could understand the reasons for the change”. The emphasis on communicating honestly and openly was received positively and helped shore up trust. One employee said, “We trust the management because they are showing us hard, cold facts.”  

This transparency helped the company preserve trust and stopped second-hand rumours emerging.

Another organisation we researched didn’t communicate openly or regularly, with employees reporting communications were ‘sugar-coated’. In this environment, distrust and misinformation spread, resulting in push-back and disengagement with the changes which undermined the organisation’s ability to navigate through the crisis.

1. Build a bridge to the future founded on core values and purpose

The first step towards reducing employee uncertainty is to develop a shared understanding of how the organisation will navigate a crisis. This involves openly and honestly communicating with employees about how a crisis is affecting the organisation. Leaders need to communicate the changes and priorities required to overcome these challenges, and how these changes will reinforce and protect the organisation’s established values and purpose.

Drawing on familiar and established foundations of trust within the organisation further helps reduce employee uncertainty. These trust foundations are unique to each organisation and can include the values, shared purpose, relationships, practices, structures and processes that built and sustained trust before the crisis.

For example, in one UK manufacturing business we studied, employee trust is largely based on strong relationships, transparency and communication between line managers, workers and trade unions. Recognising this, senior management worked directly with affected plants and the unions when planning, announcing and implementing changes right down to a local level.

As one employee described, communication was “more frequent so that people were aware it was changing and therefore could understand the reasons for the change”. The emphasis on communicating honestly and openly was received positively and helped shore up trust. One employee said, “We trust the management because they are showing us hard, cold facts.”  

This transparency helped the company preserve trust and stopped second-hand rumours emerging.

Another organisation we researched didn’t communicate openly or regularly, with employees reporting communications were ‘sugar-coated’. In this environment, distrust and misinformation spread, resulting in push-back and disengagement with the changes which undermined the organisation’s ability to navigate through the crisis.

2. Care for and support employees emotionally and practically

This second practice reinforces the benefits of caring for and supporting employees and helping them cope with the uncertainty and ambiguity of a crisis. This includes a willingness to work through emotions commonly triggered by crises such as fear, anxiety and vulnerability. These emotions have the potential to overwhelm, disrupt thinking and threaten ongoing relationships.

Organisations can develop coping capabilities and resilience among employees by creating safe environments, structures and support mechanisms where they feel cared for and where their emotional needs take priority.

These efforts don’t need to be grand gestures, rather simple authentic actions such as acknowledging the difficulties and challenges affecting employees, leaders making themselves accessible to employees, and scheduling regular check-ins to address issues before they snowball.

At one retail organisation we researched, a partner described how her “diary was just cleared” as affected staff became her priority “over every other appointment”.

One of the clearest ways to support employees in the wake of a crisis is to protect their jobs. Our research reveals the organisations that successfully preserve trust all implemented a range of strategies to minimise job losses, including cost-cutting, salary reductions, decreased work hours, leave without pay, sabbaticals and redeployment schemes.

Investing in upskilling and retraining employees during a downturn also strongly demonstrates support, and has the added benefit of strengthening the organisation’s capability once the crisis passes.

Getty Images/Luis Alvarez

Man sitting at a desk with a laptop experiencing burnout.
Man at a desk with a laptop experiencing burnout
Woman speaking at a business meeting.

Getty Images/Nicola Kaite

Getty Images/Nicola Kaite

Woman speaking at a business meeting

Getty Images/Nicola Kaite

Getty Images/Nicola Kaite

3. Empower employees and treat them fairly

Organisations can foster a sense of empowerment and control among employees by proactively consulting them. It's vital to involve them in decisions and changes that affect them, and treat them with fairness, understanding and empathy. This in turn, enhances their levels of engagement, wellbeing and acceptance of change.

Recognising each employee’s unique needs and giving them meaningful choices in decisions that affect their work arrangements and benefits help preserve trust.

For example, a UK law firm involved in our research developed an innovative voluntary scheme called “Flex” that empowered employees to select and change elements of their employment contracts to help avoid formal redundancies.

One of the most consistent and powerful findings in behavioural science research is that fairness is critical to maintaining trust. In a crisis, fairness is demonstrated by diligently adhering to consistent and transparent processes when making difficult decisions, and clearly and openly explaining how these decisions are made.

Showing how difficult decisions such as pay cuts are collectively and fairly distributed across the organisation, further builds solidarity in the face of adversity by signalling ‘we are all in this together’.

3. Empower employees and treat them fairly

Organisations can foster a sense of empowerment and control among employees by proactively consulting them. It's vital to involve them in decisions and changes that affect them, and treat them with fairness, understanding and empathy. This in turn, enhances their levels of engagement, wellbeing and acceptance of change.

Recognising each employee’s unique needs and giving them meaningful choices in decisions that affect their work arrangements and benefits help preserve trust.

For example, a UK law firm involved in our research developed an innovative voluntary scheme called “Flex” that empowered employees to select and change elements of their employment contracts to help avoid formal redundancies.

One of the most consistent and powerful findings in behavioural science research is that fairness is critical to maintaining trust. In a crisis, fairness is demonstrated by diligently adhering to consistent and transparent processes when making difficult decisions, and clearly and openly explaining how these decisions are made.

Showing how difficult decisions such as pay cuts are collectively and fairly distributed across the organisation, further builds solidarity in the face of adversity by signalling ‘we are all in this together’.

A business team having a meeting in a room

Getty Images/Morsa Images

Getty Images/Morsa Images

Building organisational trust requires vigilance, attention and ongoing action.

Research shows that trust within organisations paves the way for cooperation, increasing employee commitment and discretionary effort. It also results in higher quality problem-solving, as well as enhanced innovation and performance.

Organisations that nurture a genuine environment of wellbeing and trust even through disruption will inspire employees to navigate and respond constructively to change, contributing to organisational agility and resilience.


Professor Nicole Gillespie holds the KPMG Chair in Organisational Trust.

Learn more essential business skills with a professional development short course

Find out more

Purple
Purple