Failure may be unavoidable at times, but what does it take to maintain the trust of your staff, co-workers, and sponsors?

Mr Jamie  |  Singapore
Published 2014-09-19 11:00:53

Welcome to the “CEO Series”. Here, we talk about how entrepreneurs learn to become great CEOs, as the greatest technology companies in history, most often than not, are led by people like them.

“Whoever is careless with the truth in small matters cannot be trusted in important affairs.”.

-Albert Einstein 

A senior executive, who had been working at a famous consumer brand, decided to start up his own business a few years ago. Because of his outstanding working record in the last company, he attracted many talented people to join him, and attracted fundings from many major sponsors. Unfortunately the good days didn’t last long. Three years later, after the company’s fruitless attempts on three or four business models, the company ran out of funding, and left him no choice but to close down the business.

Image Credit: Charm Marketing
Image Credit: Charm Marketing

Victory and defeat are both common in battle, not to mention that the chances of failure is much higher than the chances of success in starting up a business. It is nothing extraordinary. However, after his business failed, not only the company was dissolved, but from employees to shareholders, directors to overseers, everyone of them sued him in court. Although the accusations were not totally groundless, they were mostly actions the entrepreneur had to take under such considerations like manpower, speed, cost, and others. These actions could not considered as valid evidence. The judge could only advise them to settle it out of court.

To sue a failed company and its executive, especially when he has already lost most of his fortune together with the business, would not get them anything back, even if they won. The reason why the interested party still went through the trouble to launch the lawsuit, to put it bluntly, is to express their deep frustration by action, toward the senior executive. Over the three years of ups and downs in the company, the decisions that he has made and the way he conducted himself has made him lost the trust of the employees, stakeholders, directors and overseers completely.

Image Credit: Texas Enterprise
Image Credit: Texas Enterprise

This certainly is a very extreme example, but there is another extreme example that happened to people around me. When the first company of Entrepreneur B failed, s/he received support from the original investers as well as his/her team at that very moment, so s/he could rebuild his/her business right away. This got me to think about the differences between the senior executive and Entrepreneur B. Eventhough they both failed, but if only the senior executive had dedicated in preserving the trust of the interested party, perhaps the scenario between the former and the latter won’t be that different.

To win and to preserve trust no matter what it takes, that is an important lesson for a CEO. Things has gotten even more complicated in the modern society where the internet and entities are intertwined. But if you know the appropriate ways to do it, you would be able to achieve it more effectively.

Below are some of the most common methods that have been used by modern day CEOs and are doing it splendidly, as I have observed.

Also read: [CEO Series] Larry Page’s Ten-Year Discipline Before Returning As CEO

#1 Persist in being transparent and consistent, online or offline

Ever since Facebook became popular, quite a number of management people have begun to communicate ideas and build their personal brand regularly through Facebook. This is a very good application of Facebook in the management system. However, one thing to take note of is that your words and your actions online and offline, should be open, transparent, and consistent. The way we behave ourselves are being observed by our co-workers everyday. It is actually very easy to spot when you are trying to be someone else you’re not on Facebook. Allow this to happen for too long and people will naturally lose their trust in you.

Image Credit: Recruitment  Agency Now
Image Credit: Recruitment Agency Now

#2 Reward Your Team In Achievements; Assume Responsibility In Failures

Whenever the team receives an award, achieve great accomplishments, or get media coverage, modern day CEOs often would share the joy with everybody on Facebook. When you do this, do not forget to give credit to the team, and take responsibility for imperfect details. Expressing generosity wouldn’t cause your friends to look down on your abilities, but instead it would help to win the hearts of your team.

#3 Give Timely Praise And Recognition

Whenever a co-worker works hard and works overtime on weekends for a project, or when s/he closes an important deal for the company, other than giving him/her high praise within the group, many CEOs would also compliment him/her on Facebook. This may seem trivial, but it sometimes could bring great encouragements to the co-worker.

#4 Maintain Full And Clear Communication With Everyone

Good things don’t happen all the time. When failures and setbacks come, besides facing them and dealing with them, smart CEOs that I know of would also make use of tools like social groups, email, and WhatsApp to communicate the situation comprehensively to all members of the interested party concerning important matters, such as details of how it happened, how to deal with it, and to review lessons learnt from it. Humans cannot possibly be perfect, not to mention that the path to starting up a business is full of twist and turns. Nevertheless, only leaders who would examine his/her mistakes win respect.

Image Credit: Blocks Of Leadership
Image Credit: Blocks Of Leadership

#5 Walk The Talk

Lastly, which happens to be a fundamental yet crucial one, is to prove what you say with action. Some people see Facebook as a theatre stage. They would pay lip-service on stage, but they almost would not realize their promises. This is a huge mistake, especially when you are interacting with potential partners. If you can’t even fulfill a small promise, how do you expect people to run a big business with you?

Also read: Tesla’s CEO and Billionaire Elon Musk, Talks About His Five Secrets to Success

This article is originally written by Jamie Lin, a well-published author based in Taiwan. The article is translated from Chinese by Loh Sin Yee and is reproduced here with permission. Images were added into the article for visual purposes.

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