Too much trust could actually be bad for business, study finds

There’s no denying that trust is essential in a healthy workplace. It’s expected that you trust your co-workers and your boss. And you hope that your boss and peers trust you.

Common wisdom is that trust brings numerous benefits: It improves communication, raises group performance, reduces conflict and provides greater job satisfaction.

Good teamwork means not trusting each other too much.

A recent study by Claus Langfred, Ph.D., associate professor of organizational behavior at the Olin School of Business, found that too much trust could actually be bad for business — when it comes to working on team projects.

After two years of studying teams working on various projects, Langfred found a correlation between the level of productivity and the level of trust between group members. Langfred said when individuals within the group have a lot of autonomy, then the least-productive teams turned out to be those whose members trusted each other the most.

“That trust under certain circumstances is a bad thing sounds strange,” Langfred said. “But the explanation makes perfect sense.”

Businesses often group people together for either long- or short-term projects. While each team might develop a different work style, frequently group members contribute to the project through individual effort. The expectation is that the group will coordinate the work and that the group will self-monitor to make sure everything is on the right track.

“In these self-managing teams, people can make the mistaken assumption that trust can be a substitute for monitoring,” Langfred said. “They think, ‘We really trust each other a lot; we don’t need to monitor each other.’ And that’s when it gets dangerous.

“The reality is, you need a minimum level of monitoring to ensure productivity.”

Langfred studied 71 teams of Olin School M.B.A. students, who worked together over the course of four months. Every year as school starts, first-year M.B.A. students are organized into strategically designed teams.

Langfred said this is a nearly ideal setting to study teams because group members are forced to work together in stable teams on a variety of class assignments across all of their required classes. He had the students fill out questionnaires at the end of the four months to measure how the students felt about each other.

The implications of Langfred’s findings confirm what most businesses probably already know: Creating productive teams is tricky.

“There are a lot of ways things can go wrong when you create teams, especially self-managing ones,” Langfred said. “You need to be very deliberate and careful about how you design them, or you risk losing productivity.

“Now we know that in addition to a lot of other factors, it’s important to remember all teams need at least some level of monitoring. It’s nice when team members like each other and get along well; but when it comes to trust, there is a such a thing as too much of a good thing.”