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Tuesday, July 2, 2013

The Value of Transparency and Why You Should Embrace It

In Paul Borawski’s recent post on A View from the Q he asks if you are in favor of transparency and why.

Good leadership is all about communication, and the best leaders are completely transparent with their staff. 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.

Be honest and open with your staff on matters that affect them and could ultimately put their mind at ease. It is important that you involve employees where you can with decision making to make them feel valued. As a manager, your aim is to have an open and honest working environment where your staff feels confident in coming to you with the truth about matters, whether they are big or small.
Let them in on what is going on within the company as well as how their jobs contribute to the big picture. When you keep you employees informed they tend to feel a greater sense of worth. Keep communication hopeful and truthful – do not be afraid to share bad news, instead be more strategic about how you deliver it. Improve performance through transparency – By sharing numbers with employees, you can increase employees’ sense of ownership.

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

I’m part of the ASQ Influential Voices program. While I receive an honorarium from ASQ for my commitment, the thoughts and opinions expressed on my blog are my own. 

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  1. What is your opinion about pay transparency? We have a pay grade that we use in the company, should we share it with our employees?

    1. Sharing pay rules and salary bands are pretty normal for most business. However sharing individuals actual salary is never a good idea. In my experience creating team based rewards and incentives work better than individual merit. Both are necessary of course but if you want to create teamwork then you need to recognize and reward that behavior.