TRUST, RISK, AND DECISION-MAKING IN ORGANIZATIONAL CHANGE

Abstract

With organizational development comes both promise and risk. Trusting someone is also a risk but trust is also a resource that can reduce risk and make an organizational development effort successful. The relationship between trust and risk is poorly understood and has escaped theoretical detailing. This article discusses trust, trust buidling, and the relationship between trustung and risk-taking in an organization. The authors argue that the risk associated with trusting someone is often an acceptable cost of building a relationship that helps reduce the risk and increase the chance of success of future decisions. Therefore, trusting others is not merely risky but normative. Trust has advantages over many other techniques for managing risk because trust is generalizable, informal, and derived from the forms of social information common to organizational interactions. This view of trust as an organizational development resource helps extend existing risk theory to a social cognitive theory of risk perception and management in group endeavors.

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