Your customers want it. Your employees want it. This is why you need it.

“Did you hear?” says Anna.   “Hear what?” I replied.   “The rumor is that John is on the way out.   I hear his numbers were not that great”.

This type of water-cooler conversation happens every few seconds in most organizations.   Rumors spread like wildfire, consuming hours of productivity and stirring up many emotions. With research suggesting that up to 70% of all organization communication comes through the grapevine, rumors and gossip are,by far, the most significant communications channel at work.

At times of uncertainty, rumors and gossip are significantly accelerated. When there’s not enough formal communication or perhaps they do not appear trustworthy or authentic, our human nature kicks in.  Almost every instinct we have including fear, anger, curiosity, jealousy and envy, rivalry, sociability, sympathy, constructiveness, secretiveness, and acquisitiveness comes to play, fueling a machine that is much more powerful than we know or understand.   With the rumor mill at full tilt, morale, engagement and productivity all get negatively impacted and we spend our time stressing over things that are sometimes not even true.

We know that the world of work has changed significantly. For starters, we are far more networked, both internally and externally to a point that formal communication channels have become “yesterday’s news”.   Most of us can likely find out that someone has left the company or got promoted through LinkedIn as opposed to the corporate memo, which arrives two weeks later.

The most important aspect of information flow to the way an organization runs is that information actually empowers whereas lack of information marginalizes.  When we think of today’s business problems, they are far more complex than in the past.   The idea of business problems being solved by a lone genius are too far fetched.  It takes collaboration and shared purpose; a common truth that everyone understands, internalizes and commits to helping solve.  When people have an ability to truly and deeply understand the business and it’s challenges, they roll up their sleeves to create innovative solutions.

Despite organizations being more networked, in most organizations, the cultural norms still call for commonly hiding, concealing or spinning information to our personal advantage.  Part of the reason we do that is because we seek safety.  The old-school thinking is that the better things are hidden from others, the more secure we feel.  In reality, quite the opposite is true.   This mindset not only creates misalignment, fear and anxiety, but also significantly hinders an organization’s ability to adapt to change and innovate.

Many still believe that ‘knowledge is power’, where in fact, that notion is completely upside down.  Knowledge may have meant power in the past, when information was scarce and only a special few who held knowledge of information had the upper hand.   Today, if we need to acquire new knowledge,  Google is our best friend.  Knowledge and information are no longer power, but sharing knowledge is.

For organizations that want to be adaptable to today’s business environment and keep up with changing customer demands, information needs to flow freely and be transparent and readable by everyone. The more people see the data, the more ideas and action there will be to fix the problem–by collaborating on it. For example, if the sales pipeline figures for next quarter are low, the entire company takes notice and works to fix it.   It isn’t just the problem of marketing or sales, everyone from R&D to Customer Support can pitch in solutions and ideas and collaborate to solve the problem.

Organizations who have recognized the power of transparency are realizing that the payoff spans way beyond being able to solve complex problems and empowering employees.  It also serves as a magnet for top talent who are attracted by working in an open and forthcoming with environment.   Transparency also spans beyond the walls of an organization.   It builds trust with customers and that trust becomes the foundation for incredible customer relationships.   “Consumers expect brands to be more transparent about their practices,” says Jeremy Wilson, the director of creative strategy at Ogilvy One Worldwide. “Brands are using social media. You can now ‘friend’ a brand. So when you’re friends with a brand, you expect it to behave like a friend.”

Boston-based company, Hubspot practices what they call an “uncomfortable level of transparency” where information is shared as if every employee was a top manager. Hubspot’s wiki exposes things like cash balance, burn rate last month, valuations, impact on dilution, customers they’re talking to — Anything that the company is in a position to legally share, their default is to share it.


According to Hubspot’s co-founder and CTO Darmesh Shah, they often hold very animated debates on their internal wiki, even down to employees criticizing management decisions. Shah, who had his own share of flames on the Wiki, says he doesn’t see any issue with that.

In fact, these constructive discussions are very beneficial from a few perspectives.   First, it empowers employees and only increases their value, second, it engages employees and gives them shared purposes and a bias-for-action, and third, the collective genius is far more powerful at solving problems. This doesn’t mean that Hubspot is a democracy, however, transparency does drive a distinct competitive advantage for them through their ability to attract top talent and to bring out the best of their people through empowerment and autonomy.

Social media start up; Buffer is another example of a company practicing an even more radical form transparency.  At Buffer, they publicly disclose all their employees’ salaries, including the CEO, COO, CTO and others, their equity structure and their full revenue metrics. Coming from a command & control structure, leaders often do a double take when they hear this example, but in reality, Buffer is at the forefront of a movement that is actually tremendously benefiting their business.  Buffer’s transparency has not only enabled it to recruit more top talent, but attract more users, as multiple studies and surveys have clearly indicated, customers are becoming sensitized to advertising or the classic “corporate speak” that you might hear from a traditional company.

Buffer openly shares all of their employee's salaries
Buffer openly shares all of their employee’s salaries

While you don’t need to go as far as Hubspot or Buffer did, by making information open and available (even within your respective team), you can remove the distractions, fears, and negativity that hinder execution and agility. Insights from neuroscience underscore that our brains work best when we no longer feel the need to hide, cover up our mistakes, or dwell on errors. Simply put, sharing data and insight fuels shared purpose and accountability and gets everyone on board with solutions.

Transparency done right will help you recruit top talent, retain exceptional employees, and foster innovation throughout your company, and every organization can benefit from that.


2 thoughts on “Your customers want it. Your employees want it. This is why you need it.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s