The benefits of trust in professional services firms

Not sure if it causation or correlation, but according to a research report by Service Performance Insight, The Professional Services Maturity Model:

organizations with a high confidence in their leaders delivered over twice as much margin (23.4% compared to 10.4%), higher revenue growth, lower attrition and almost double the number of projects delivered on time.

Source: email from spiresearch.com.

“The 2009 Professional Services Maturity Model - A Comprehensive Framework to Assess Organizational Efficiency and Effectiveness across the Five Service Performance Pillars” is a 168 page benchmark report developed by Jeanne Urich and R. David Hofferberth, P.E.

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Following up on the last post, the February edition of Trendwatching describes “Generation G”:

“GENERATION G Captures the growing importance of ‘generosity’ as a leading societal and business mindset. As consumers are disgusted with greed and its current dire consequences for the economy—and while that same upheaval has them longing more than ever for institutions that care—the need for more generosity beautifully coincides with the ongoing (and pre-recession) emergence of an online-fueled culture of individuals who share, give, engage, create and collaborate in large numbers.

In fact, for many, sharing a passion and receiving recognition have replaced ‘taking’ as the new status symbol. Businesses should follow this societal/behavioral shift, however much it may oppose their decades-old devotion to me, myself and I.”

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Understanding trust

From management-epistemology

Seeing complexity of trust and trust management by managers as well as understanding its role in everyday business might be the source of the competitive advantage for the pioneers up to the day when similarly to specialization it becomes a standard. These are benefits that come from being first in the space of strategic activities.

(From Trust Management – The New Way  in The Information Society in Economics and Organization of Enterprise, Volume 2, Number 2 / 2008, Grudzewski et al.)

On the one hand, trust is part of all human relationsips and institutions: how could markets, corporations, governments function without trust? It seems like it’s a part of human nature. Yet, as this graphic illustrates it now has a more important place in today’s business world: in the post-industrial age, business relationships are primarily based on trust rather than hierarchy or bureaucracy.

We tend to think of trust as a mental state, a psychological acceptation. It should rather be construed as an act: an act by which we give, say, tell something. Trust is not only thought, it is also made. As a good example, see the following video by David Maister. Or the Strategy of Giving. Or Open Source software, wikipedia, etc. You have to give something (to a client, or a community) before earning someone else’s trust.

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