There’s a saying that goes something like: generals fight the last war, not the current one.
Learning and implementing new tactics takes time.
The experts have learned the lessons from the last war… but not the painful ones walloping them now yet.
In that spirit – and in the midst of a current financial disaster – let me solve the 2008 one for ya.
Now, I’m no economist. I get the gist of what happened – too many mortgages went to folks who couldn’t pay them back. Once that hit critical mass, it bloodied the nose of the financial sector… which dragged the rest of the economy down with it.
I know that’s an oversimplification.
But that’s fine. It’s accurate enough to show how to fix it… just as internal organs are complex, but you know to keep sharp objects from poking them.
Sometimes, you know enough to be useful.
Anyway, a key lesson from 2008 was just how obscure finance can get.
Only a fool would loan money to someone who can’t pay it back…
Unless they can bundle up the bad loans, make them look attractive and sell them to someone else.
Again, the shadiness that caused the last financial meltdown was complex.
But it could have been impossible, had one element been in place:
If everyone understood what was on offer – from the banks to the would-be homeowners to the insurance agencies backing the loans to… well, to everyone – the ticking time bomb would have sat in plain sight.
Everyone would have avoided it, making it a bad investment (and not just a bad idea).
Before the crisis, a hypothetical transparent bank would have looked like idiots. They’re passing on free money!
After the crisis, they would’ve looked like the only heroes in a room of scoundrels.
Such is the nature of trust.
Sometimes investing in it is expensive.
And sometimes it’s difficult and time-consuming.
But it’s always – always! – the easier option in the long run.
And as trust in governments, corporations and the old institutions continues to crumble, it becomes even more valuable to rise above the muck.
Because it’s either rise above it or become consumed by it.
How do you become more transparent – and therefore earn more trust – with your people, your industry and your community?
Not by staying invisible, that’s for sure.
If you want your people to trust you, communicate more.
More often and more deeply.