The recent recession led to the resurfacing of a timeless debate: How much information should be shared with employees?
Employees need to be informed of change management efforts before – not after – the fact. They want transparent, trustworthy leaders. Yet leaders are torn between providing the entire truth and holding back certain realities to avoid unnecessarily scaring people or losing top talent.
The answer is: the more transparency, the better. Share information with your employees for two reasons:
- It’s the right thing to do.
- It’s good for business.
Foster a Culture of Openness
Transparency is not a crisis control tactic. It should be a way of life. It shapes your culture and drives results. If you maintain a commitment to openness and constant communication at all levels, your organization will only get stronger.
- When employees don’t hear from management, they fear the worst. Fear and resentment threaten morale and productivity. As noted by Quint Studer, author of Straight A Leadership: Alignment, Action, Accountability, “Maybe the news is bad, but maybe it’s not as bad as they are imagining. And even if it is, once they know the truth, they can plan and act accordingly.”
- Transparency helps employees connect to the big picture. Middle managers and front-line employees may be working in a vacuum where leadership decisions seem ill advised, unfair or simply inexplicable. Transparency enables them to grasp the reasons behind decisions. This understanding prompts them to make needed behavior changes.
- Messages need to be consistent across the organization. Train managers with talking points to ensure that everyone hears the same message, positioned the same way. This allows employees to hear what’s really going on in a controlled and consistent fashion.
- Communications consistency breeds organizational consistency. When everyone hears the same message, they are motivated to respond in similar ways. This consistency filters down to customers, who get the same basic experience regardless of who they deal with.
- Transparency heals divisiveness. It alleviates the toxic “we/they” perception that there are separate groups inside a company that work at cross purposes.
- Open communication helps retain talent. Employees can’t thrive in an environment of secrecy or uncertainty. People want to work for a company that treats them with respect and values their problem-solving skills. If you withhold information, they may assume the company is in trouble. In-demand talent may take this cue to leave.
The Picture of a Transparent Organization
In a healthy, transparent company, everyone on the senior leadership is aligned in understanding organizational goals and plans. They all agree what success looks like. Information then cascades downward, so employees at every level receive a consistent message and call to action.
- The perception gap between senior leaders and middle managers is closed. Communication with mid-level managers is relentless to ensure they understand the real issues facing the company at any given time.
- Employees understand the financial and operational impacts of decisions. Everyone is taught to think like a CFO. For instance, they know the true cost of a production error, absenteeism or wasted raw materials. Likewise, they realize the potential positive impact of doing things a new way or implementing a cost-control measure.
- Managers are prepared to answer tough questions. In a transparent culture, there’s no value in hiding tough financial or other realities. Sharing information falls to managers, some of whom are better communicators than others. Managers should be equipped with questions to anticipate and talking points to address the tough issues when they arise. This is key to ensuring delivery of a consistent and controlled message throughout the company.
- Bad news is shared as soon as possible. Once a tough decision has been made, it is shared with employees immediately and in a straightforward manner. As Studer explains, “Knowing what’s happening and what it means is always better than not knowing. And often, what people are imagining is worse than what’s really happening.”