How Datafication Damages Trust

The world of work, having undergone a transformational period of digitization, has now entered an era of ‘datafication’—the turning of human actions and exchanges into data. Organizations increasingly use data-driven ‘smart’ technologies such as AI, algorithm-led monitoring, real-time performance dashboards, etc. to covert simple social interactions into numerical data. This is then used to optimize working practices and processes to generate value.

While the use of AI-assisted management systems in the workplace brings huge efficiencies and cost savings, their use can detract from responsible leadership practices and dehumanize employees. They can bring unexpected and often subtle disruptions to established relationships and ways of working, causing people to question if their employer truly has their best interests at heart and often significantly undermining employee trust.

Trust by improving organizational alignment and employees’ sense of belonging ultimately drives performance. Peter Drucker developed his trust-based management theories in the 1950s, stating that "organizations are no longer built on force, but on trust.” 1970’s management guru, Stephen Covey, identified two components of leadership trust: character (integrity and intent) and competence (ability to deliver results). Organizations introducing AI systems need to pay attention to these ideas that clearly still stand.

Smart tech can trigger employee vulnerability

A recent study from Antoinette Weibel and Simon Schafheitle at the University of St Gallen, and Lisa van der Werff at Dublin City University, finds that ‘datafication’ and the tools it employs have the effect of creating small, irregular surprises in the workplace, which can disrupt employees’ sense of safe, predictable work routines, making them feel vulnerable in two ways: ‘Discontinuously Vulnerable,’ where people are unsure about what’s expected or what’s coming next, and ‘Socio-Emotionally Vulnerable,’ where they feel dehumanized or reduced to a cog-in-the-machine.

As a result of this vulnerability employees, who previously trusted the organization and their managers unquestioningly, instead of trusting on autopilot, start to actively and consciously assess whether they can rely on their employer—and ultimately how committed they want to be to the organization.

Active trust management

The researchers go on to offer advice as to what organizations should do when employees feel vulnerable due to datafication. Their main point being that it is not enough to passively assume trust. Employers need to actively manage and rebuild trust. Leaders can do this by first communicating a credible and transparent narrative around the reasons for and meaning behind tech changes, and by reassuring employees emotionally that the workplace remains normal and that the organization understands and cares about employee concerns.

Secondly leaders should adjust their own outlook and practices to support a trusting environment, defining leadership roles that bridge the gap between technology and employees, emphasizing qualities such as compassion, emotional competence, and responsibility. They should also foster a culture of shared learning and as a part of this involve employees in co-design or impact assessments of new tech.

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If people feel uncertain or dehumanized by opaque smart tech, trust becomes fragile. The important lesson that comes from this new study, is that to preserve employee trust, as new AI systems are introduced in an organization, it is necessary to reframe technology from threat to opportunity. Smart technologies can easily erode trust—but not if leaders actively manage trust by showing they care and involving employees in tech integration.

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Access the research paper: ‘Smart Tech is all Around us: Bridging Employee Vulnerability with Organizational Active Trust-Building,’ Antoinette Weibel, Simon Schafheitle, Lisa van der Werff, 2023, Wiley Journal of Management Studies