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Trust is the headwater for a stream of success

In the middle of Jim Dougherty’s first week as CEO of Intralinks, a company that provides secure Web-based electronic deal rooms, one of the company’s original investors called. “So, what’s your plan?” he asked. Dougherty told him he needed to spend a few weeks learning.

“He was incredulous that I did not have a pre-baked plan. I was incredulous he thought that I should,” Dougherty states in a recent Harvard Business Review blog post (blogs.hbr.org).

The company was hemorrhaging so much cash that its survival was at stake. The service was going down three times per week; it was in violation of the contract with its largest client; and its chief administrative officer had just been demoted.

What did Dougherty do on his first day? He spent more than four hours listening to client support calls at the call center, sharing headsets with members of the team and moving from desk to desk to speak to the reps.

“To say they were surprised is an understatement. Many CEOs never visit the call center, and virtually none do it their first afternoon on the job,” he says.

As Dougherty explains it, the call center was his priority not only to discover what customers were saying, but also to make a statement internally that what other team members thought mattered. “Whether you are taking over a small department, an entire division, a company or even a Boy Scout troop, the first thing you must get is the trust of the members of that entity.

The best way to start building trust is to take the time and meet as many individual contributors as possible as soon as possible. Meeting rank-and-file employees is overlooked by a majority of newly appointed leaders, Dougherty says.

“Many leaders see their role as directing and giving information, rather than gathering. There is pressure to ‘come up with the answer’ quickly or risk looking weak. Too many new leaders believe they’re expected to know the answer without input or guidance. Nothing could be further from the truth.”

He recommends that managers in new positions spend as much as half of their time meeting with frontline employees one-on-one or in small groups. Take a pad and take notes. Listen intently.

A simple but effective open-ended question is: “If you were put into my role tomorrow, what would be the first three things you’d do and why?” Or, “What are the three biggest barriers to our success, and what are our three biggest opportunities we have?”

Over the initial few weeks in his new position, Dougherty learned how unhappy clients were with their complex bills, why service went down so often, why the company’s pricing gave clients headaches, that 80 percent of the customer calls could be eliminated with a simple fix to the service, and that clients wanted predictability of expenditures.

“After six weeks, I had enough information to return to the management team with specific recommendations on what I thought we should do. Instead of just laying this out in an all-hands meeting, I began laying out the plan in one-on-one meetings in which I talked about how each individual’s feedback had helped guide my thinking. This created a tremendous buy-in among all levels of the team.”

By mid-March, after Dougherty was only 10 weeks into the job, Intralinks rolled out its new plan. By the end of the year the company had signed 150 new long-term contracts (up from zero), revenue was up by almost 600 percent, the burn rate was cut by 75 percent, and the company was positioned to raise a $50 million round of financing a few months later.

“None of this could have happened without building the trust of the team,” he says. “New leaders must remember that many of the best insights on how to fix a company lie with employees further down the org chart. Creating a trusting, honest dialogue with these key personnel should be every new leader’s top priority.”