Organizations with "very high" levels of trust achieve better financial and organizational performance, according to a construction industry study conducted by Autodesk in partnership with management consulting firm FMI Corporation. The study, "Trust Matters: The High Cost of Low Trust," finds that 63% of survey respondents shared their organizations have less than "very high" trust.
According to the survey, "very high" trust organizations generate more repeat business, retain more employees, and drive higher levels of operational success than organizations with lower levels of trust.
"The performance advantages at 'very high' trust organizations can represent millions of dollars in profitability," said Jay Bowman, research and analytics lead at FMI. "With margins in the construction industry continuing to shrink, organizations should be aware of their trust ranking and how it can be improved to increase profitability. The 'very high' trust attributes uncovered in this report reflect approaches organizations can focus on to minimize uncertainties, simplify collaboration and ultimately improve trust."
According to the survey, 57% of "very high" trust organizations report working with repeat clients for more than 80% of their projects, whereas only 42% of "above average" trust organizations reported the same repeat business rate. FMI and Autodesk said the highest trust organizations working with repeat clients can expect gross margins two to seven percent higher than organizations of a similar size with only "above average" trust. Working with repeat clients provides a financial advantage for firms, as acquiring new clients is estimated to cost five to 25 times more than continuing to work with repeat clients.
Construction professionals at "very high" trust organizations also reported staying in their roles longer than professionals at organizations where trust is "above average." According to the survey, given the costs associated with recruiting new employees, "very high" trust organizations can save as much as $750,000 annually by simply not having to onboard new employees. The retention of employees is an increasingly important issue for firms given the growing skilled labor shortage and the difficulty many organizations are reporting finding qualified employees.
A final benefit related to being a "very high" trust organization according to the survey is improved project delivery. Organizations with the highest levels of trust are twice as confident as those with "above average" trust about meeting their project schedules. FMI estimates the highest trust organizations can save as much as $4 million each year simply by meeting their deadlines.
The survey also finds organizations with high trust also rank high on employee engagement. Seventy-four percent of respondents from "very high" trust organizations said they would recommend their companies as great places to work.
In addition to revealing the benefits of having a high trust organization, the survey also uncovered common, measurable attributes that foster trust and positively impact performance across construction organizations, including consistent internal processes, transparent communications, environments where employees feel safe to share views, and a focus on employee development.
FMI and Autodesk surveyed 2,527 construction professionals across the globe, asking them to rank the level of trust in their organization and across project teams, and share financial and organizational performance. Respondents were asked to rank the level of trust within their organization on a scale of 1 ("very low") to 5 ("very high").
