How can companies build greater trust in the marketplace to gain competitive advantage? This report offers some interesting insights.
Business was once done on a handshake, with your word being your bond, but in today’s digital-centric world, trust is becoming more scarce.
This sobering trend became apparent in a new survey conducted by Harvard Business Review Analytic Services, which found that nearly two-thirds (63%) of senior executives at large enterprises throughout the world say trust among people, businesses and institutions has declined over the past two years.
Some of the world’s leading brands have reported massive security breaches that give hackers access to sensitive information entrusted to familiar vendors.
In addition, sophisticated phishing techniques enable hackers to compromise corporate credentials and pass themselves off as trusted employees and business partners to undermine trust in internal systems and stakeholders.
Breakdowns like these are clearly on the minds of top global executives. Eighty-eight percent of the respondents to the survey name large-scale cybersecurity exploits that expose corporate or personal data as a significant contributor to the decline in trust.
More than half of all global executives say being seen by customers as trustworthy gives them a market advantage over competitors and contributes to higher productivity in internal operations.
Trust as a business driver
Companies with strong safeguards for protecting client data understand the competitive implications. “We see in news reports how data breaches have impacted trust, so UPS is vigilant in our data protection efforts to retain the trust and confidence of our clients,” explained my colleague, Erik Archambault, a survey respondent and a director of enterprise healthcare accounts at UPS.
But trust demonstrated by effective data management can be an even more compelling business driver when companies can exhibit their value in helping clients succeed with their customers.
UPS focuses on the value of trust in our client relationships, which includes how we mitigate risk. This helps them get critical products to market more effectively, which in turn enhances brand trust with their consumers, patients or overall end users.
“Trust demonstrated by effective data management can be a compelling business driver.”
For us, that means managing the global chain of custody for high-value pharmaceuticals, medical devices and specimens. Quality assurance, high visibility, regulatory compliance and temperature controls are critical for these complex, sensitive shipments.
Accurate audit trails also reduce regulatory risks for clients in healthcare, an industry with significant and strict oversight.
How to demonstrate trustworthiness
UPS takes extra steps to satisfy customers, including the development of software for pharmaceutical clients that creates a more secure and auditable chain-of-custody record. In addition, UPS may schedule quarterly business reviews with customer compliance, operations and procurement professionals to address any logistics questions or concerns.
Efforts such as these require significant amounts of time and money, but leaders say the investments are worthwhile. A significant majority of leaders (86%) say they are seeing a clear return on their trust and risk investments, according to the survey.
Trust builds strong partnerships. Whenever we create a new partnership, we identify what factors led to that success such as the combination of our proprietary technology and the expertise of our people.
“Security efforts require significant amounts of time and money, but the investments are worthwhile.”
So, if we win X amount of dollars with a pharma client because it values our supply chain technologies and competence, we see those as part of a winning recipe for logistics success.
The journey never ends
The results of the Harvard Business Review Analytic Services survey illustrate the importance of trust for global businesses.
Enterprises that remain good stewards of sensitive information create opportunities for attracting new customers, fostering innovation, defending against market challenges from competitors and helping customers and partners succeed with mutually beneficial business relationships.
Methodology: A total of 818 respondents drawn from the HBR audience of readers (magazine/ newsletter readers, customers, HBR.org users) completed the survey. To read the full research report, click here.
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