Building the Bridge of Trust in Farm Succession

Defining Trust

There are many definitions of the word “trust.” According to Merriam-Webster’s Dictionary, one definition of “trust” is “assured reliance on the character, ability, strength, or truth of someone or something.” Another way is to look at trust as a vulnerability. You are taking the risk of making something you value vulnerable to another person’s actions. Being vulnerable is not something that is easy to do. By understanding our own definition of “trust,” we can begin understanding how others trust, which in turn will assist in clear communication and conflict navigation.


Some questions to ask yourself as you navigate trust would be: “What does it look like in your farm operation when there is trust?” And on the flipside: “What does the farm operation look like when there is lack of trust?” The answers to those questions are the first step in building the bridge of trust on your farm. In this next section we will talk about three common types of trust that can be found in almost any business setting.

Types of Trust

Let’s look at three different types of trust: interpersonal, competence, and institutional trust.

Interpersonal Trust

Interpersonal trust is based on the relationship you have with another person, and the length of time you have known them. If someone continues to show they can be relied upon in a predictable way, they are considered trustworthy.

An example of this in farm succession could be the relationship between the owner generation and the successor generation. Decisions about the farm operation are shared openly between the owner and successors. Both the owner and the successors care for each other, and they want what’s best for each other. It’s when either generation, in small ways, is not doing what they say they are going to do that trust can begin to break down.

Competence Trust

Competence trust is based on skills, abilities, and experience the other person has. If the other person has the expertise to aid in solving a problem, then we are more likely to trust their judgment or advice.

From a succession standpoint, it could be that the owner generation begins to hand over management decisions to the successor generation so they can incorporate the experiences and expertise they acquired, whether that be through a degree in an agriculture-related field or working with another farming operation. If the owner generation encourages the successor generation to go off farm to get a degree and/or work off farm, they trust that the successor generation will eventually come back and apply the skills and knowledge they gained to the farm operation.

Institutional Trust

Institutional trust is based on whether we see the “system,” the rules, or the processes as being trustworthy.

We see this in farm succession planning as well. If the owner generation is open and clear about farm financials and the current state of the operation with their successor generation, this creates a culture of trust that the owner generation isn’t hiding problems or concerns they have with the state of the business. This opens up a clear line of communication between one generation and the next.

Another example would be that the successor generation will trust that there is a plan in place for distribution of assets, and that it will be clearly communicated among all the heirs (both on and off farm).

Breakdowns of Trust

Now that we have covered types of trust, let’s explore what might impact trust in the farm operation.

A lot of farm operations are family owned. For some family-owned farms, it might be hard to keep problems that arise in the family from impacting the farming operation. No one size fits all and each farm operation is different; however, there are some acts or instances that could impact trust in all farm businesses.

Acts of Commission

The first way trust can be broken would be an act of commission. This is when a person, group, or organization does or says something that is inconsistent with what you expect.

For example, an owner generation who is normally open about decisions on the farm decides to sell without even consulting the successor generation about taking over the farm someday.

Acts of Ommission

The other universal way trust can be broken is through an act of omission. This is when a person, group, or organization fails to do what they say they are going to do.

An example of this would be the successor generation planning to go to school or work on another farm operation in the hopes of one day taking over their own farm, but then not following through on their skill building and becoming unable to run the farm operation. Maybe either generation struggles with addiction, and it gets in the way of their financial ability to manage the farm.

These breakdowns of trust may seem hard to overcome. In the next section we will talk about ways to overcome those challenges by using “posts” to build your bridge of trust on your farm.

Building the Bridge

Bridges help us to get from one point to another. In order to help you visualize building a metaphorical bridge, it may be helpful to have a pen and paper handy.

On that sheet of paper, you are going to draw two points—you can use half circles for hills or whatever symbol would make the most sense to you. You are going to leave space between the two hills. This space will represent the barriers to building trust.

On one side you are going to write down what trust looks like currently, and on the other side you will write down the end goal you want to achieve. Having a clear idea of what that goal looks like will help you know when you have reached that side of the bridge. Writing the goal down will help with that visualization.

For a farm business, this will look different for each person involved with the operation. Maybe the end goal is to transfer management completely in the next 5 years from the owner generation to the successor generation. Or maybe it’s a simpler goal of having more consistent farm meetings that include an agenda to help stay on task.

Building a bridge may seem as easy as laying a few boards across a short gap. This is most likely a temporary solution and not a more permanent, sustainable solution to reach the other side. This is where our posts come into play.

Posts

The following posts are not the end all be all, but suggestions on what foundations you can use to overcome the barriers to trust on your farm and build your bridge.

Care

This could be seen as a cornerstone piece: If care is not there, the bridge may not be sturdy enough to get you to the other side. Care can be seen as having the other person’s thoughts and feelings in mind when making decisions or taking action.

Reliability

You do what you say you will do. If there is consistent follow through on decisions and actions, this leads to a strong culture of trust.

Competency

This post is going back to competence trust. Are there the skills, experiences, and expertise to get the task done? This type of trust can be seen when management is being transferred from one generation to the next.

Clarity

Are the expectations made clear? Does everyone involved with a decision or action know what the expectations are?

Integrity/Accountability

When a mistake is made, do you own up to it? Have you apologized and offered ways to make amends?

Building Back Trust

We talked about what trust is, how trust can be broken, and steps to creating a more trustworthy environment, but what do you do when trust is broken or not there?

Let’s revisit the three types of trust and how they can relate back to the posts you just created.

Rebuilding Interpersonal Trust

This can relate back to care and integrity/accountability posts for your bridge.

The following questions come from the publication How to Create Trust in Family Firms and Rebuild It When It’s Lost: Implications for Practice and Research, by W. Gibb Dyer.

  • Did the offending person apologize? Are they remorseful for their actions?
  • Can the person change?
  • Are they able to “make up” for that lost trust?
  • Is the offended party willing to forgive?

Rebuilding Competence Trust

When it comes to competence trust, it’s all about relating back to the skills, abilities, and experiences of those involved.

Suggestions include:

  • Institute training to improve family and non-family employees’ skills
  • Develop competence-based performance appraisals
  • Develop fair procedures to deal with low performance
  • Require credentials certifying competence

Rebuilding Institutional Trust

Let’s talk more about clarity. This will be the key component to building or rebuilding institutional trust.

Suggestions include:

  • Clarify and share details about the business
  • Share financial information on firm performance and assets
  • Develop a succession plan that is shared with key parties
  • Make decision-making processes transparent
  • Have outside performance reviews

Conclusion

In summary, to build that bridge of trust, it is important to look at what “posts” you need that can help you to achieve that goal.

Though no two farm family businesses are the same, understanding where trust is at and how it’s built can help with the farm succession process.

Below are resources used to develop this article and may help you as you continue your farm succession journey.

References

Brown, B. (2018). Dare to lead: Brave work, tough conversations, whole hearts. New York: Random House.

Dyer, W. G. (2012). How to create trust in family firms and rebuild it when it’s lost. Springer.

Feltman, C. (2009). The Thin Book of trust. Bend, OR: Thin Book Publishing Co.

Hewlett, J. P. (2011). Trust in the family business. Enterprising Rural Families.

Horsager, D. (2012). The trust edge. New York: The Free Press.

The worksheet titled Factors Affecting the Farm Business Transition in Cultivating Your Farm’s Future may help you start a conversation around the topic from this Blog.

Author Bio

By Kaitlyn Davis, Agriculture Outreach Specialist, UW–Madison Division of Extension