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Workplace cultureLatest NewsBusiness performanceEmployee engagementProductivity

Mutual trust between managers and staff boosts performance

by Ashleigh Webber 27 Apr 2021
by Ashleigh Webber 27 Apr 2021 Shutterstock
Shutterstock

Organisations with a high level of trust between management and employees are more likely to perform well financially and productively, according to a study.

Durham University Business School and the University of Coimbra in Portugal found that a strong sense of trust in the management-employee relationship also correlated with higher levels of productivity and greater feelings of harmony and understanding among the workforce.

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Senior managers and employees were asked what they thought of each other’s contribution to the workload, wider company performance, and about trust in each other’s abilities.

The researchers found that as employee trust in management increased by one unit, on a scale of 1 to 5, the likelihood of observing very good economic and financial performance would increase by 4 to 5 percentage points.

The likelihood of observing the highest relative productivity in comparison with other organisations in the same sector increased by 6 percentage points as trust rose by one unit.

Data came from the European Company Survey and involved 28 countries including the UK. Researchers concluded that organisations with poor productivity and financial performance should encourage managers to review their relationships with employees and attempt to collaborate with them more.

They said the study highlights the importance of strong industrial relations – ensuring that managers trust staff and allow them to work autonomously, and employees feel that their managers are competent and trusting of them.

Durham University Business School economics professor John Addison, said: “Trust between the parties (and no less an important absence of trust or disaffection) are important drivers of good – and bad – firm performance. And good industrial relations trumps any specific type of employee representation”.

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Ashleigh Webber
Ashleigh Webber

Ashleigh is editor of OHW+ and HR and wellbeing editor at Personnel Today. Ashleigh's areas of interest include employee health and wellbeing, equality and inclusion and skills development. She has hosted many webinars for Personnel Today, on topics including employee retention, financial wellbeing and menopause support. Prior to joining Personnel Today in 2018, she covered the road transport sector for Commercial Motor and Motor Transport magazines, touching on some of the employment and wellbeing issues experienced by those in road haulage.

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