Trust is considered as a potential source of competitive advantage. It is a well-known fact that the customers and clients evaluate the firms and the distributors they would like to co-operate with or buy from according to the level of trust they feel towards these organizations. This happening is related to all cases of co-operation – small and big ones. Every time someone decides to buy something the purchase is based on trust. I have witnessed many situations where the trust of a customer towards the retailer or a company was the basis of the person’s choice of certain goods and products. Every one of us has faced a choice like that. My friend at the store goes through a whole row of face creams to pick one, when I ask – why she chose the cream of one particular brand – she replies “I trust their products”. This is how trust creates an advantage.
Trust among the company employees creates an advantage too. It helps the firm develop. This is why it is important that the workers feel valued and appreciated in the organization. The company must create comfort for the workers to be motivated to work harder and help their company become even more popular and prestigious. Company employees that do not feel valued at work will not put any effort or work hard for the firm’s development; they are simply not interested in helping the company that does not appreciate them. I know a person who uses every opportunity to sneak out of his workplace to sleep in his car, he says: “why should I work hard if my boss does not even pay me enough?” An unmotivated worker who does not trust his managers creates a disadvantage for the company. Employees listen and respond to managers, who care about their well being (Organizational Trust: A Source of Competitive Advantage, 2014).
Commitment to ethical conduct as a source of trust
Yes, a commitment to ethical conduct on issues such as environment, product quality, and fulfilling contractual agreements can affect a firm’s competitive advantage. Maintaining honest ethical conduct develops respect and trust towards the company from the point of view of the customers. The customers are more likely to purchase from the firm with an ethical code and high moral values. Product quality is the main criteria and the basis for any successful relationship with a customer, as every customer is searching first of all for goods of high quality. I also know many people that are oriented to purchase cosmetic products, which are environment friendly and were not tested on animals. For me, these criteria are very important.
Why pursue stronger ethical conduct?
The modern world becomes more and more concerned with the problems of environmental pollution, nowadays if a firm sells or produces goods that are packed into environment-friendly containers, are ecologically clean, and were not tested on animals has a bigger advantage to attract and keep the potential buyers. Companies that make their clients feel valuable to have higher chances to gain more customers. If a customer on iTunes is trying to purchase an item they have bought before – the system will notify the client about this (Peppers, 2013). This is an example of a company with strong ethical conduct, the company honestly warns the customer so that the customer does not make a mistake. This gesture proves that the company values the clients’ priorities and does not pursue easy money. Customers will trust firms with stronger values; this is why the company leaders should be interested in developing and maintaining ethical conduct.
Reference List
Organizational Trust: A Source of Competitive Advantage. (2014). Canadian HR Solutions. Web.
Peppers, D. (2013). The Only Lasting Competitive Advantage is Extreme Trust. Web.