At PingPod, everything we do – who we hire, how we communicate, the product we offer, obsessing over customers – is done with trust in mind. We believe that high trust improves productivity and satisfaction, while low trust slows progress and increases costs. Trust is fundamental to the company culture, and one of the key reasons I joined PingPod.
The Economics of Trust
The best startups share two competitive advantages: they move faster than other companies, and they do more with less. Trust is the critical ingredient determining these efficiencies. As Stephen Covey writes in The Speed of Trust, “Trust always affects two outcomes – speed and cost. When trust goes down, speed will also go down and costs will go up.”
The core of a business is making decisions and executing on decisions. Not every decision needs to be made fast – the irreversible ones should be made with deliberation – but the vast majority of decisions benefit from quick action, feedback, and iteration. In order to act fast, your team needs to be empowered to decide and act. In a high-trust environment, you have confidence that your team will exercise good judgment. They shouldn’t be afraid to take smart risks. Failure is not fatal. Feedback is the lifeblood of learning.
Slow decision-making is often a function of bureaucracy and processes borne of low trust. If a manager needs to sign off on every decision, no matter how small, the team can only move as fast as that manager’s response time. Decision execution slows further when it requires coordination between internal teams (e.g. marketing and engineering) that depend on, but do not trust, one another. Projects grind to a halt if two functional teams each think the other is “the blocker.”
Beyond slowing things down, low trust also yields increased explicit costs. Legal bills go up, the compliance team grows, and the focus shifts from delighting customers to managing a dysfunctional team.
There is perhaps no better illustration of the cost of trust, than the way airport security transformed due to 9/11. Prior to 9/11, the airport was a high-trust environment. It was easy to “gate check”, and arrive at the gate less than 30 minutes before takeoff, check in at the counter, and board the plane directly. Post 9/11, the airport experience is unrecognizable. Airports comply with security protocols to keep us safe. And yet, this safety comes at a staggering direct and indirect cost. If, on average, every person in the U.S. who flies today spends a minimum of an hour more in the airport than they would have pre-9/11, that pencils out to more than 850 million hours lost to airports in 2022.
The Building Blocks of Trust
What does it mean to say we trust a person or a brand? It means we know what to expect from them and we know we’re in good hands.
The key building blocks of trust are:
- Reliability. Trustworthy people are dependable. You know they will show up on time and be prepared.
- Competence. Trustworthy people consistently produce good results. They have a track record that lets you know they have the expertise or know how to get the job done.
- Integrity. Trustworthy people are honest, sincere, and transparent. They are candid and fair. You can trust that they say what they mean, and mean what they say.
- Care. Trustworthy people don’t just care about themselves; they care about what happens to you.
It should be noted that each of these qualities is not enough on its own. A person can be reliably dishonest. Competent people can cut corners. High integrity people can be incompetent. A person who cares deeply about others, without the other elements, is the proverbial nice guy that finishes last. Trust is highest when all these building blocks are present.
The power of trust is best illustrated by its absence. Many of us have had some experience with a toxic workplace – an experience defined by a total lack of trust. Work becomes political. There is rampant speculation about people’s motives. Team members assume the worst about co-workers and feel like they are “walking on eggshells.” Communication grinds to a halt as team members withhold information, assuming that the truth will be used against them, or might even get them fired. The team spends its time thinking about how to say things, rather than what to say. Interactions are seen in terms of winning and losing. If a mistake is made, casting blame becomes more important than how to rectify the situation. The need for constant vigilance creates an enormous cognitive load, and leaves little room for collaboration and creativity.
In a high-trust environment, the vast majority of this friction melts away. The team has a shared mission, and celebrates both individual and team successes. Transparency is the default mode of communication. Healthy, lively debate is encouraged. The team works towards the best answer, irrespective of who came up with the original idea. Mistakes are still made; but they are learned from. Motivation and satisfaction are high.
Building a High-Trust Team
In the early stages of a business, the key to building a high-trust environment is hiring high-trust people. At PingPod, our recruiting strategy to date has been to hire for trust first and foremost. We bring in talented, high-integrity people that we have known and worked with in the past. Trust is there from the get-go with these team members, because it already exists. We’ve worked alongside them in times of success and adversity. Our trust in these people has already been earned, and it’s lasting.
Take me, for example. My skill set admittedly fits very well with PingPod; but it’s the trust Max and I have built over our eighteen-year relationship that is the most powerful quality of all.
Back in 2005, I was managing a fund that seeded startup hedge fund managers; Max was launching a quantitative hedge fund called MM Capital. I was the first, and only, day-one investor in MM Capital. The fund performed very well, I eventually joined MM Capital as a partner, and we grew the business to several hundred million in assets under management. Returns were great, investors happy.
And then adversity hit. The fund was positioned poorly for a black swan event, and suffered a large drawdown. I was in charge of all our investor relationships, so I snapped into action, putting together a detailed play-by-play of what happened, and the logic behind each of the fund’s decisions. Max and I flew to Chicago to meet with our biggest investor – a firm we had just lost tens of millions of dollars for – and spent three hours walking the investment committee through everything that happened in painful detail. It was one of the hardest things I’ve ever had to do, but it was the right thing to do.
Max and I came out on the other side with the deepest level of trust – we each knew the other was someone you wanted in your foxhole when things got tough. Joining PingPod was one of the easier decisions of my career: a chance to build a category-defining business with people I trust and admire.
Building a High-Trust Brand
Former Coca-Cola CEO Muhtar Kent said, “A brand is a promise. A good brand is a promise kept.” At PingPod, we promise to use technology to make fun, healthy experiences accessible to all. Our customers trust PingPod because it is reliable, competent, high-integrity, and cares about them.
At PingPod we pledge to give customers a reliably great experience. Our technology enables customers to play rather than creating friction. We put our customers first as members of a community. And we communicate with our customers honestly and clearly.
But this promise is not a one-way street; we also place trust in our customers. Operating autonomously requires that we trust our customers to treat our physical spaces as intended; and because of this, it’s important that we attract the right customers. Everything we do – from product to branding, to user experience, to hiring – is done with the goal of attracting customers who value what we offer: fun, fitness, and community.
A customer recently described PingPod as “good clean fun.” We couldn’t say it better. By upholding our promise and attracting the right customers we ensure that the PingPod community is the embodiment of good, clean, fun.
If this post resonates with you, we would love you to join the movement. Download the PingPod app or head to www.pingpod.com.
See you at the Pod!