Transparency is key to employee trust

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Morning talk show host Kelly Ripa brought management transparency to the forefront last month when she told television viewers she deserved more respect than to learn second-hand that her co-host, Michael Strahan, was leaving.

To some degree, most of us have felt that management has held back telling us something we should have known about sooner. However, how we have reacted in such scenarios varies widely. Some of us have spoken up like Ripa, insisting on transparency in the future. Others keep their heads down and stew, or they launch into their own secret quest to find another job.

Regardless of the path employees have taken, the debate about open communication still permeates most workplaces. For employers, it’s worth noting that skepticism about management transparency is real — and troublesome. A full quarter of employees don’t trust their employers, and only half believe their employers are upfront with them, according to a 2014 American Psychological Association survey of 1,562 U.S. workers. That lack of trust is significant because employees are more engaged and happier at a companies whose cultures support transparency, according to a 2015 Employee Retention Study of 400 U.S. employees by Seattle-based TINYpulse, an employee engagement firm.

As Ripa demonstrated, employees believe longevity and hard work earns them the truth about the state of the company or decisions that affect them directly. They want to hear firsthand if they are getting a new boss, or the company is closing the branch they work in or going in a new direction and their job description will change.

“Everyone wants to feel they matter,” says Lanie Morgenstern, a South Florida-based career coach and CEO of Lion’s Compass, a new human resources website. “In any relationship, trust is the foundation. Now you put that into the setting of work, it needs to be the same. If trust is not there, that’s when people are job-hopping.”

Of course, management believes transparency is more complicated. Executives often weigh what the organization has to to gain or lose when timing the disclosure of actions that affect some or all employees. Many employers say that telling their workers about new strategies or planned changes is simply too risky, especially today when employees use social media and news spreads virally. As one CEO puts it: “Change will always elicit a response, and that response could kill a deal, so it’s a factor in what we disclose and when.”

Carol Craig, CEO of Melbourne’s Craig Technologies, says a public company must consider the market reaction while private companies must consider investors when they disclose information to employees — who may tell vendors, customers and competitors. Craig has invested her own money to expand her aerospace engineering and manufacturing company to 400 employees. She says her management team often gets frustrated when she makes major decisions — about growth or strategy, say — and informs them afterward, but she considers it part of doing business: “Sometimes, there is a lot more at stake than someone’s feelings of being included.”

For business owners and corporate leaders, deciding how open to be can be important in the aftermath of a decision. “Companies often find themselves in a bind,” says Nathan Hiller, associate professor in the department of management and international business at Florida International University. “There are times when you cannot tell everyone everything. But if you hold back information and the employee feels disrespected, when you need buy-in for organization change, they will be less likely to come on board.” Of course, there is a difference between holding back information and being dishonest with employees, he says: “Outright deceit stings more, and it’s much harder — maybe even impossible — to rebuild trust.”

Marta Montenegro, a nutrition specialist, first noticed how employees value sharing information when she became the founder and editor-in-chief of SOBeFit magazine in Miami, which she ran for five years: “I realized you have to be smart as a manager to know what to communicate and when. The important things needed to be communicated as soon as possible, and they needed to come from me rather than through office gossip.”

HR experts question how much thought some executives actually give to transparency and whether they default to an outdated closed-door protocol that may have been established decades ago. David Niu, founder of TINYpulse, the Seattle company that gives businesses a pulse on employee engagement, says today’s workers are speaking up to change that type of thinking. Niu said he experienced that pushback firsthand when he left a manager out of a key decision. “The manager said to me, ‘That’s a tough decision and I understand why you made it, but I’m disappointed you weren’t upfront.’ I told him, ‘I will be brutally honest with you, but you have to take it in stride.’ That’s how we operate today.”

For mutual respect in the workplace, transparency is required from employees, too. In the frenetic 21st century, many don’t share with their managers their job dissatisfaction or work/life balance concerns until they accept another offer. Niu puts it back on management to engage in real conversation. “At any business, people are the No. 1 asset,” he says. “Everything comes down to communication with your people.”

CINDY KRISCHER GOODMAN WRITES ON WORKPLACE AND WORK LIFE ISSUES

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