By Quint Studer
Just My E-Pinion
Do your employees really know what’s going on with your company? "Don’t be worried that they can’t handle the truth," says bestselling author Quint Studer. He offers convincing reasons for creating a culture of transparency in your company—starting now.
The economy may be improving, but employees are still worried: Are layoffs imminent? Will I have a job next week? In fact, will the company even survive the year?
If you’re like most executive-level leaders, you have a pretty clear picture of the state of your industry, the context you operate in, and the financial health of your company. And you’ve likely wondered: How much should I tell employees about what’s really going on?
Got a Comp or Benefits Question?
Get a personalized answer within 1 business day with BLR’s all-you-need-in-one-place website, Compensation.BLR.com®. Get a free special report just for trying the site. The report is yours to keep regardless of your decision on the program. Read more.
The answer is simple: The more the better. Here’s why:
· People assume the worst when they don’t hear from their leaders. Silence from the executive suite causes fear and resentment. 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 why. When employees are working in a vacuum, top-level decisions may seem ill-advised or unfair, or simply inexplicable. Transparency connects them to the "why" of those decisions.
· Employees may not understand how the external environment affects the company. Senior leaders are aware of new laws affecting their industry, innovations reshaping the marketplace, financial pressures facing their customers, and so forth. It’s their job to know. But mid-level managers don’t necessarily see the same picture—and frontline employees almost certainly don’t.
· Transparency allows for consistent messaging across the organization. People don’t have to get their (speculative, distorted) news through the company grapevine. They hear what’s really going on, in a controlled and consistent way, from their managers. (It’s a good idea to train managers in “key words” they can use to answer tough questions.)
· Transparency creates organizational consistency. When everyone is hearing the same messages, everyone is motivated to respond in similar ways. And this consistency trickles down to the customers, who get the same basic experience regardless of who they’re dealing with.
· Transparency leads to faster, more efficient execution. When times are tough, execution is everything. And the ticket to good execution is good alignment: All sectors of an organization must understand exactly what’s required so they act in a coordinated and collaborative fashion. Transparency facilitates that kind of alignment. It’s all about a shared sense of urgency.
Are You Paying Your Workers Too Much?
Just like home prices, pay rates differ by location. So if you’re going by national averages, you may be paying too much … or too little. Find out in your state’s edition of BLR’s Employee Compensation in Your State program. Updates, salary and benefits survey results, and newsletters all included! Yours to try at no cost for 30 days! Read More
For example, when employees know customer spending in the widget industry is down 30 percent and that a new competitor is eating into your market share, well, they tend to get focused fast.
· Transparency heals “we/they” divisiveness. We/they might manifest as staff vs. management, this branch vs. that branch, or corporate vs. everyone else. Managers without answers will foster we/they by saying, "Sorry, that’s orders from the top."
· Transparency keeps good people from leaving. High performers don’t thrive in an atmosphere of secrecy and uncertainty. They want to work for a company that treats them with respect and values their input. Hold information too close to the vest and they may assume the company isn’t healthy. And even in the worst economy, high performers have options.
· Transparency facilitates the best possible solutions. In transparent cultures, leaders encourage employees to solve problems themselves. And because those employees are the people closest to a problem, and because they must live with the outcome, they almost always design the most effective, efficient solution. And, of course, they’ll also have instant buy-in.
One more thing: Don’t think of transparency as a “crisis control” program. It’s a long-term commitment. When the good times roll around again, the strategy will serve you just as well.
Quint Studer is a management consultant and the author of Hardwiring Excellence: Purpose, Worthwhile Work, Making a Difference and Straight A Leadership: Alignment, Action, Accountability. www.studergroup.com.