Why You Should Care About Transparency? | 5 Tips to Get You Started

Are You Hoarding or Sharing Information?

M ore importantly, what does your team think you’re doing?


When I began my business career in the 1970s, the word “transparency” was not in the business lexicon.

You knew what you were told … and you were told what someone thought you needed to know … but it was unlikely that you’d hear much about where the company was going or your role in it.

Prior to starting my own company in the early 1980’s, I can’t recall a single company-wide meeting at any of the companies where I worked … or any general discussion of the company’s performance or strategy.


It doesn’t necessarily mean opening the kimono or letting everyone ramble around backstage.

It doesn’t mean sharing every financial tidbit with everyone all the time.

In fact, it’s as much an attitude as a policy because it’s rooted in collaboration and an open-book environment.


During the Great Recession, I saw a Business Week column by Jack Welch, former GE CEO, about the importance of keeping morale high during difficult times.

Jack was pretty clear about the value of transparency as well as the tendency by executives to hold the cards much closer to the vest when times are tough.

Here’s what he said:

“Now, we realize we don’t need to tell anyone why transparency makes sense. Most managers know from experience that employees get more pumped when they understand where the company is going, why, and what role they play in getting there. But an awful thing tends to happen to information-transfer in a downturn. Managers choke: It’s as if they can’t bring themselves to deliver hard news without leaving out pieces and fuzzing the lines.”


For too many executives, this is counter-intuitive. They fear that the harsh truth when times are difficult will unhinge the company. But really, transparency is the glue that holds strong companies together.

It means that there are no hidden agendas or secret cabals or schemes being concocted behind the curtain.

Rather, problems and challenges are shared, input is encouraged, and everyone locks arms in a crisis to stand together.

Transparency represents the ultimate collaborative environment where the bad and the ugly get delivered with the good.


Are there some tricky parts to transparency?

Yes there are. Examples would include deliberations about employee performance or discussions about the possible sale of the company.

At the same time, leaders of transparent organizations are committed to their people, and want their people to be able to make plans for their lives by helping them understand as much as possible about what the future may hold.


Yes, there’s some risk in this process, but what’s risk-free these days anyways?

Sure, there is always the risk of leaks or damaging whispers, but they’re offset by the unassailable value of building a collaborative environment of committed teammates fighting for a common cause.

You may lose a few skirmishes but you’ll win the war.




1. Be Transparent PERSONALLY

You have no chance of building a culture of transparency if you aren’t walking the walk.

Remember that you’re in the Spotlight of Leadership. If you’re not PERSONALLY transparent, it will be plenty obvious and not just the battle will be lost.

The war will be lost.

2. Be Consistent

You’ve got to be transparent across the board.

If you’ve earned the respect you need to Be a More Effective Leader, people will expect you to lead them, down to the local pub or across the battlefield. They expect you to be consistent … and you need to be.

3. Set Boundaries

You’re not opening the kimono to anything and everything.

Be honest about where you’re drawing the line. Consider some examples to help you examine these options:

A. You’re not going to share individual personnel decisions except within the reporting chain. Otherwise, they’ll be described when a specific action is taken.

B. You’re not going to share ongoing discussions about a change of ownership. Those discussions happen periodically, and often lead nowhere, so you’re not going to feed the fires of rumor and speculation until and unless there is something definitive to report.

C. You’ll share general P&L information but not cash flow or balance sheet information unless it’s particularly relevant to the company’s performance or its future. (You can do this in many ways. You’ll have to consider what makes the most sense for your company.)

4. Don’t hedge the bad news.

People can tell when you’re quibbling.

That doesn’t mean to drop bad news like a bombshell. Couple it with an action plan about how you intend to approach the problem and how you’re depending on everyone to contribute their best ideas and participate in the solution.

5. Set regular meeting times.

It’s not enough to be transparent only when you’re asked.

You need to set specific regular times when you’ll report on the “State of the Company” with a specific agenda describing what you intend to cover.

That puts everyone on notice of your intention to be transparent and provides a forum for Q&A.

Question: What are you doing to create a Transparent Organization?

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