China Gorman: How to Become a Great CEO

China Gorman, CEO, Great Place to Work
- Leadership - Nov 06, 2014

It’s not simple to be a great CEO. But to become a great one, simplify. Focus on a single priority that promises both to make you more effective as a leader and happier as a person.

That priority is trust.

My organization, the Great Place to Work Institute, has been conducting research into what makes for great workplaces and great leaders for more than two decades. We have discovered that workplaces with high levels of trust between staffers and management are the organizations that tend to be most prized by employees.

And because employees working under trustworthy leaders tend to enjoy their work, collaborate well with colleagues and give their best efforts, companies with high-trust cultures tend to outperform the competition.

By focusing on trust, in other words, you can succeed by market standards even as you succeed in human terms—establishing positive relationships with your people. For CEOs who often find themselves stressed out to the breaking point, building a high-trust culture can be a tonic that both boosts results and helps put the joy back into the job of leading.

So how do you increase levels of trust as a CEO?

You start at the top.

You become a trustworthy leader.

There are three fundamental things to do that will inspire people’s trust in you. The first is to live up to your word. The second is to treat others with respect. The third is to be even-handed with people. Without demonstrating credibility, respect and fairness, no leader can expect his or her people to trust them.

READ MORE: What makes Google a Great Place to Work, Interview with China Gorman

But there’s more to leading the way to a high-trust culture. Our co-founder Amy Lyman wrote a book on exactly this topic in 2012. In The Trustworthy Leader, she described a path toward improved trust that she called “The Virtuous Circle.” It’s a recursive path of growth and learning with six elements:

Honor. Trustworthy leaders feel a sense of honor with respect to their role, expressing gratitude for being asked to lead and acknowledging the responsibility that comes with it.

Inclusion. Trustworthy leaders promote the inclusion of every person into the community of the organization, building bridges of trust beyond the boundaries of individual department or units.

Value and engage followers. Trustworthy leaders engage those who are following them by paying attention to them, learning from them and connecting with them as people beyond their work roles.

Sharing information. Trustworthy leaders openly share information with people to help them participate in and influence the life of the organization.

Developing others. Trustworthy leaders help all employees to learn, grow and discover their talents, with career development programs that reach broadly and deeply throughout the organization.

Movement through uncertainty to pursue opportunities. Trustworthy leaders skillfully weigh risks and rewards associated with available opportunities, and take action.

The last element is the one we traditionally associate with CEOs. The steely-nerved executive boldly setting a course in uncharted waters. But as Amy Lyman noted, this fundamental leadership role comes with relative ease to CEOs who have taken the other steps on the Virtuous Circle: “When employees see their leader act with honor, feel included, choose to follow, have access to information they can use, and are supported in their development, they will support the leader’s efforts to try novel approaches and find the best way forward.”

You might be saying to yourself: this is all too soft and fuzzy. Leadership is more about toughness than trust. But growing mounds of evidence shows that trust is precisely what makes organizations tough—resilient and hard to beat. Danish Best Workplaces last year posted more than three times the revenue growth of Danish companies overall. Italy’s Best Workplaces have posted better revenues than their competitors in the same industry for six straight years. And publicly traded companies on the U.S. Best Companies to Work For® list have nearly doubled the performance of the stock market overall from 1997 to 2013. A 2013 report from research and consulting firm Interaction Associates found that “companies adept at practices that reinforce strong leadership, trust, and collaboration enjoy better financial performance.”

That’s no surprise to Edouard Mandelkern, president of France-based technology services firm Davidson Consulting. Mandelkern is a good example of a trustworthy leader. He says his eight-year-old company began with a plan to make employees comfortable and members of a family of sorts.  ‘We wanted to make it a company like a home,’ he says.

Creating a high-trust, intimate culture was part-and-parcel with a business strategy to hire and hold onto the very best talent. ‘In order to attract the best engineers we had to be attractive,’ Mandelkern says.

Over the years, Mandelkern and his fellow executives have followed steps on the Virtuous Circle. For example, practicing inclusion, Davidson sponsors many social events for employees and provides funds so staff can produce events of interest. Developing employees also is a strength—the company’s “open bar” approach to training encourages staffers to keep advancing their skills. And consider this example of valuing followers: in response to hearing that young employees struggle to find housing in the high-cost Paris area, the company decided to build a nine-apartment home for staffers.

This past year, on the basis of employee survey responses showing a strong climate of trust, Davidson Consulting ranked as the best medium-size workplace in Europe. And like other great workplaces, it is winning in the marketplace: revenue jumped from €78 million in 2012 to €87 million in 2013. The company expects revenue to reach €105 million this year.

The progress is all the more sweet because it is driven by employees who love their organization. One staffer told us this about Davidson and its leadership: ‘We do not “live to work.” They are interested in us on a human level.’

As Mandelkern learned of the award at our European conference in Rome, he was beaming with pride. A successful, satisfied executive.

You can be like him. Not that the path is easy to follow. But it is clearly marked. By focusing on trust, by becoming a trustworthy leader, you will become a great CEO.  

China Gorman is global CEO of Great Place to Work®

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