Transparency + Clarity: Information Dumps Don't Work

Lately, we hear a great deal about the value of radical transparency.  Consultants argue that leaders need to share information broadly with members of their organization.  They argue that radical transparency builds buy-in, trust, and commitment.  Sounds sensible, right?  Is there a downside though?  What risks does this approach create?

Martin Gutmann and Antoni Lacinai examine this issue in a new Fast Company article.  They contend that transparency only works when coupled with clarity.  They write:

Transparency in a company setting typically means more dashboards, more all-hands, and more context. It feels responsible—especially in uncertain moments—because it signals you aren’t hiding anything.  But facts don’t organize themselves. People still have to decide what matters, what they need to ignore, and what to do next. When leaders don’t provide that structure, they leave teams confused, and teams will fill in the blanks with rumor and gossip. In the end, this leads to more insecurity and more internal politics.

Gutmann and Lacinai argue that leaders need to explain why information is important, and then they must provide clear direction to their team members.  They have be wary of creating cognitive overload and overwhelming their employees with information.  People need to know what the priorities are and how to interpret key data.  

For me, any attempt to add clarity begins with leaders stepping into their employees' shoes.  They need to try to see things from their team members' perspectives.  How will they interpret information?  What might confuse them?  How might they be unsettled by certain data?  Stepping into their shoes will help leaders frame their messages, anticipate challenges, and develop strategies for reducing stress and anxiety among workers.  

Keeping Secrets at Work: When Transparency Isn't Valued

We often hear discussion of the value of transparency in organizations.  Nevertheless, many employees become frustrated about the lack of openness in their organizations.  They wish that more information was shared about key initiatives so that they could understand future plans, as well as the rationale for pursuing certain courses of action.

In a new study, Michael Slepian, Eric Anicich, and Nir Halevy examine the issue of organizational secrecy.  They find that people who keep information from others in organizations experience personal benefits as well as costs.  On the negative side, the scholars report that individuals who maintain secrets tend to express more stress and social isolation.   However, withholding vital information from others also comes with certain benefits.   It boosts perceptions of status and privilege for those holding the secrets. They feel more valued in the organization and perceive their work to be more meaningful.   These findings should not surprise us.   Just think for a moment about how people with privileged access to information tend to behave in your own organization.  

While this study highlights certain key benefits and costs associated with secrecy, it leaves open the question of just how much withholding of information is necessary in organizations.  My sense is that, in many organizations, people are more secretive than they need to be.  They withhold information because these personal benefits (status, meaning) outweigh the personal costs.  That does not mean the lack of transparency is good for the organization as a whole.  People come up with all sorts of justifications for that secrecy, but often, these arguments don't hold water.  They are flimsy rationales for not being transparent.  Leaders should test these arguments and probe the rationale being used to justify secrecy.  The costs of disclosure need to be weighed against the substantial value that derives from being transparent.   

Should We Self-Promote or Hide Success?

We dislike self-promoters, right?   Is it better to hide our success than shamelessly self-promote?  Many people may think it's appropriate and effective to hide success.  We don't want to seem boastful or arrogant.  Well, perhaps the conventional wisdom may not be correct.  Annabelle Roberts, Emma Levin, and Ovul Sezer have published a fantastic new paper titled "Hiding Success" in the Journal of Personality and Social Psychology.  

The scholars point out that self-promotion is quite typical these days, yet in their research, they also find that many people hide their successes at times.  Why?  They worry about how others will perceive them if they self-promote too much, or in some inappropriate manner. 

Roberts and her colleagues show that hiding success may have harmful effects on our interpersonal relationships.  They write:

"Unlike hiding other information, hiding success signals that a communicator has paternalistic motives, which targets find insulting.  We find that hiding success has relational costs in public and private settings as well as in response to direct and indirect questions.  Additionally, the negative reactions to hiding success have behavioral consequences:  Targets are less trusting of, less willing to cooperate with, and less willing to devote financial resources to maintaining their relationship with communicators who hide their success." 

In sum, perhaps a lack of transparency can have some significant costs.  That doesn't mean we should be arrogant, or that we should boast repeatedly about our accomplishments.  However, we should take great care about intentionally shielding others from the truth.  Honesty, it appears, is indeed the best policy.  

Ensuring Your Team Feels Valued

Source: needpix.com 

Aytekin Tank, founder of JotForm, has crafted a useful column for Fast Company titled, "4 ways to ensure your team feels valued without in-person connections."  Tank acknowledges that it can be very challenging for leaders to make team members feel valued when so many are working remotely, resources are scarce, and the stress is very high.   The article notes that, "A recent Gallup report showed that only one in three U.S. workers 'strongly agreed' they received recognition for their work in the past seven days. Employees who don’t feel recognized are twice as likely to say they’ll quit in the next year."   Given this reality, Tank offers four strategies for ensuring that team members feel valued.  

GIVE YOUR TEAMS THE TOOLS THEY NEED:  What technology, supplies, and other resources do your employees need to work effectively in a remote mode?  Like a good coach, put your team members in the best position to thrive and win.  

MAKE TIME TO LISTEN AND CONNECT:  Keep up the informal check-ins with your employees.  Don't just inform them about what you are doing or what the organization is planning.  Make sure to listen to their concerns, questions, and needs.  Open up about yourself a bit; let them see a different side, perhaps a bit about your personal/family situation.  Letting them see you as human can be very important for connecting with them, and encouraging them to be candid with you.  

INCREASE TRANSPARENCY: Provide regular updates on key initiatives and metrics.  Be honest about the challenges facing the organization.   Let them know exactly where things stand.  If you don't have everything figured out in terms of plans for the coming months, that's ok.  Let them know your decision-making process, how their input will be incorporated, and the criteria you will use to make final choices.  

OFFER TANGIBLE REWARDS: You might not be able to offer bonuses or raises this year.  What can you do to reward your employees?  Tank suggests offering time off in the future (days that they can bank now for future use), or providing new professional development opportunities.  Other forms of recognition and reward might include supporting causes about which the employees care a great deal, or perhaps providing paid time for team members to volunteer in the community.  

Transparency During the COVID-19 Crisis

Jonathan Davies recently posted a brief article summarizing new research conducted by O.C. Tanner. Here is an excerpt:

Organisations that have increased transparency with their employees since the start of the COVID-19 crisis have seen an 85 per cent increase in staff engagement. This is according to latest research by Global corporate culture specialist, O.C Tanner, which surveyed 1,715 employees across the U.K, U.S and Canada.

The survey found that leadership transparency is a critical factor right now with employees craving honesty, authenticity and regular communications. In transparent organisations, in which clarity and honesty are prioritised, trust in leaders has increased by 174 per cent, employee satisfaction is up by 72 per cent and employee burnout has reduced by 13 per cent.

For more on the importance of transparency as a means of building trust in your organization, check out this brief Kellogg School of Management video featuring Andrew Swinand, CEO of advertising agency Leo Burnett.  

Why Companies May Benefit from More Transparency about Product Drawbacks

Source: Pixabay

Most companies, quite expectedly, focus intensely on the positive attributes of their products and services when communicating with customers.   They market all the benefits, and typically, they minimize any discussion of the limitations or drawbacks of the product. After all, who would want to shine a spotlight on negative attributes of your products? 

Well, Harvard Business School scholars Ryan Buell and MoonSoo Choi decided to challene the conventional wisdom.  They sought to examine whether a bit more honesty and transparency might actually be beneficial for companies.  Buell and MoonSoo Choi published their findings in a paper titled, "Improving Customer Compatibilitywith Operational Transparency."   

The scholars worked with Commonwealth Bank, a large Australian financial services company, to conduct a randomized field experiment.  On the bank's website, potential new customers received one of two offers: one highlighted the best attributes of the company's credit card, while the other also mentioned key drawbacks that firms often tend to place in the fine print only.   In short, the company made explicit some of the key tradeoffs inherent in the company's strategy and product offering.   In other words, you get these wonderful features, but here's what we don't offer, or what we don't provide at the same level of service.   Think about Southwest Airlines... we offer you on-time flights, low fares, friendly service, and no baggage fees, BUT we don't assign seats, have no first class and no meals, and won't transfer your bags to other airlines.  The company makes the trade-offs quite clear to consumers.  

The scholars tracked customer behavior at Commonwealth Bank for the next year.  What did the researchers find?   HBS Working Knowledge summarized the key results:

"The researchers found that people who opened an account after learning about a card’s downsides spent 10 percent more each month than customers who heard only the benefits. Their nine-month cancellation rate was also 21 percent less, and they were 11 percent less likely to make late payments on a month-to-month basis... Although the team didn’t probe why customers spent more, they suspect that providing more information helped people choose products that were more compatible with their financial needs, creating a better customer experience."

Now, clearly, companies need to be careful with this added level of transparency.  They can't just dump a bunch of negative information on customers and hope to succeed.  However, they can think about how providing more transparency may help them gain consumers' trust and help customers self-select in a way that creates a more enduring and better fit between company and customer.