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How can organizations deal with the problem of too much trust, e.g. freeloaders (lazy workers who get little done) or even those who actually abuse trust (e.g. spend too much money on their own needs, or undermine coworkers, or take credit for their work, or lying about their skills during hiring process, or secretly work for competitors, or otherwise damage the company)?

Ideal is "trust but verify" which sounds good but (1) it's hard to verify (except in annoying and ineffective ways like "face time"), and (2) signaling you don't trust your employees can make people more likely to abuse your trust ("the company thinks we're spending money on ourselves anyways, might as well spend it, we're already guilty"). I think trust issues are one big factor in why nepotism (and other "hiring by connection") remains so popular.

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