Sunday, March 21, 2010

Five Reasons to be Honest with Your Employees


A recent interview by The New York Times with Kip Tindell, chief executive of the Container Store, highlighted several leadership lessons.  "Don't keep secrets from your staff" was one of foundational principles Tindell shared.

 

Good leadership is all about communication, and the best leaders are completely transparent with their staff, says Container Store CEO Kip Tindell. Tindell shares his private boardroom presentations with all his company's employees, from top to bottom. "There's never a reason, we believe, to keep the information from an employee," he says. "I know that occasionally some of that information falls into the wrong hands, but that's a small price to pay."

 

I believe that with knowledge comes power and the more information we share the quicker with can improve.  Creating a culture of openness and free-flowing information can be a competitive advantage.  Here are five reasons you should embrace transparency:

 

1. People assume the worst when they don't hear from leaders. Silence from the executive office causes a lot of fear and resentment, which certainly doesn't contribute to a productive culture. 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.

 

2. Transparency helps employees connect to the why. When employees are working in a vacuum, they can't see the financial "big picture," and decisions leaders make may seem ill-advised or unfair or simply inexplicable. Transparency connects them to the why—and that understanding propels them to act. You can ask people to change their work habits and established processes all day long. But if they don't know why they're being asked to change, they won't change—at least not for long.

 

3. Transparency allows for consistent messaging across the organization. When you commit to transparency, 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. This, in turn, creates organizational consistency. When everyone is hearing the same messages from their leaders, 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.

 

4. 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 is what facilitates that kind of alignment. It's all about a shared sense of urgency.

 

5. 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.

 

Do your employees really know what's going on with your company?  Be honest with your employees they can handle the truth.  Remember, sharing information with employees is good for a couple of reasons: one, it's the right thing to do, and two, it's good for business. 

 

As we have learned from Lean Thinking, this too can not be a flavor of the month.  Being open and honest with your employees requires long term commitment if your want your organization to continuously improve.

 

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5 comments:

  1. Honesty with employees is the foundation of Respect. Without honesty there is no respect and there is no Lean.

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  2. Wise words!
    Ian Williams - Chrysalis Performance

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  3. Great post, Tim! As Kip Kindell also said in that NY Times interview, "Communication is leadership." So any time, you or a leader you work with wants to shut down the lines of communication, remember that. What you say plus what you don't say send important messages. And if people aren't getting the full story, including the context, they can't be fully engaged and productive.

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  4. I once worked at a company that brought in a big consulting firm to diagnose problems in our product development cycle. One of the major issues was a lack of communication, and they recommended that there be greater openness and sharing of information between the execs and the rest of the company.

    But the best part is that this recommendation was delivered. . . in a closed-door meeting.

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  5. Point 1 highlights the need for executives to go to gemba. Executives can get a better read on what people want to know when they are continuously engaged with frontline employees without all the filters that layers of managmenet add.

    Nice work

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