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The business case for transparency

How to use two-way communication to build trust and retain top talent

Posted December 1, 2021 by Eliza Sarasohn

Reading time 12 min

Workplace communication norms are changing faster than many executive teams can keep up, leading rank and file workers to voice their discontent in increasingly public ways.

Traditional command-and-control style leadership has been eroding for years, and the pandemic shifted that change into hyperdrive. Along with that shift has come an increased employee expectation — and demand — for transparency. 

“If you avoid dialogue with employees on key issues like workplace flexibility, the conversation keeps going … but now you’re not part of it,” says Brian Elliott, Executive Leader of Future Forum. “There’s a real and compelling business case for honest, transparent communication — it’s become essential for building trust, retaining talent, and sustaining success.”

According to recent findings from the Future Forum Pulse, while most executives say their company’s leadership is “transparent about sharing new developments that affect the company” (81%), only 58% of employees agree. The fallout from that disconnect holds serious implications: the data also shows that employees who don’t believe their leadership is transparent are twice as likely to look for a new job.

But on the flip side, employees who believe their leadership is transparent about including them in relevant developments are twice as likely to feel excited about their company’s future. 

Source: Future Forum Pulse, conducted July 28-August 10, 2021. Number of respondents = 10,569. Sample sizes by country: USA (5,339), Australia (1,060), France (1,049), Germany (1,050), Japan (1,047), and the UK (1,024).

This playbook is for leaders who want to learn more about: 

  • The business case for leading with transparency 
  • How to build the infrastructure for transparent, two-way communication

What does it mean to lead with transparency? 

Simply put, leading with transparency means sharing relevant information across all levels of your organization — not just the “what,” but also the “how” and the “why” — through two-way,  ongoing conversation with employees. 

Transparent organizations: 

  • Ensure employees understand and have the opportunity to contribute to the business by regularly sharing and discussing the outcomes and metrics that drive success 
  • Include employees as stakeholders in planning major policy changes
  • Inform employees about big news first — or timed within minutes of any public announcement 
  • Are up front with employees about what they can/can’t and will/won’t discuss publicly 
  • Address potentially controversial topics proactively by providing venues (with guardrails) for challenging conversations
  • Provide clear answers, even if those answers may upset people

Transparent, two-way communication does not mean that executives should include employees in every organizational leadership decision or that every conversation needs to be company-wide. Instead, it’s about creating the infrastructure that encourages employees to weigh in with relevant perspectives. It’s also about rolling out new policies in ways that allow management layers to absorb the changes and offer feedback and learnings. 

“There are off-limits topics that aren’t constructive or maybe even legal to discuss openly with employees — like mergers and acquisitions,” says Elliott. “But other topics — like setting policies around returning to the office and the future of work  — require dialogue with employees to get right.” 

The impact of transparent communication:

  • Company leaders set the tone and establish the code of conduct 
  • Employees feel heard, valued, and empowered
  • Issues and conflicts are dealt with quickly and openly
  • Decisions are clear
  • Covert gossip, concern, and discontent diminish dramatically — so rumors are cut short and distractions are reduced
  • Trust increases at all levels — from employees to leadership, from leadership to employees, and between employees 
  • Employee engagement and retention increases

How transparency impacts retention

Source: Future Forum Pulse, conducted July 28-August 10, 2021. Number of respondents = 10,569. Sample sizes by country: USA (5,339), Australia (1,060), France (1,049), Germany (1,050), Japan (1,047), and the UK (1,024)

How to lead with transparency 

Transparent communication is a two-way street. Leaders need to build the infrastructure.

Under the old command-and-control style leadership, communication from executives was one way — top-down — with little opportunity for employee input. But that dated “my way or the highway” mentality is pushing employees out the door and contributing to some of the highest rates of employee turnover in our lifetimes

“Leaders need to ask themselves, ‘am I a focus group of one?'”

Helena Gottschling
Chief Human Resources Officer, Royal Bank of Canada

Recent research from Future Forum shows that a whopping 66% of executives report they’re designing post-pandemic workforce policies with little to no direct input from employees. 

“Leaders need to ask themselves ‘am I a focus group of one?’” says Helena Gottschling, Chief Human Resources Officer at Royal Bank of Canada. “You need to consider the perspectives of your employees and take care not to project your personal preferences.”  

To build the infrastructure for communicating major policy changes: 

  • Engage an employee “task force” — a group of leaders representing relevant and diverse perspectives from across the organization to draft the policy 
  • Shop draft policies and changes out to a wide range of groups (geographies, ERGs) not for detailed feedback, but to flag major concerns and potential causes of failure
  • Rollout through multiple media — e.g. All-Hands meeting, announcement memo, creation of discussion channel
  • Provide forums for managers to work through implications
  • Enlist employee ambassadors to explain the “why” of policy changes through storytelling, sharing personal anecdotes and experiences   
  • Ensure support from Comms team throughout, as well as dedicated time from key leaders

To build the infrastructure for day-to-day communication: 

  • Create a forum, such as a dedicated channel or team email alias, for handling everyday employee questions and concerns
  • Establish reliable venues for questions and concerns that fall outside of day-to-day operations (e.g. dedicated AMA channel, regularly cadenced live Q&A forum, time-bound virtual AMAs, or all of the above)
  • Give employees dedicated venues to converse amongst themselves (e.g. ERGs, #company-culture channel)
  • Make room for non-work discussions, encouraging this discourse between leadership and employees (e.g. in team meetings and town halls) and among employees on their own (through employee created channels like #politics, #socialjustice, #techculture) 

Transparent communication is a two-way street

Chart describing the difference between one-way and two-way communication

To foster constructive communication, model mutual respect and trust

You don’t need to lay down new rules for each new communication venue, but you do need to set and maintain the tone. Your approach to this should ladder back to your company’s code of conduct and organizational values and should be based on a philosophy of mutual respect and trust. 

How to do it: 

  • Set the tone from the top. For all employee convenings (live meetings; Slack channels; email; company parties and events) clearly and consistently communicate expectations for employee behavior, and ensure leaders model that behavior.
  • Default to transparency and accountability in public forums. Anonymity is rarely the right choice. 
  • Acknowledge open questions — and commit to a timeframe to respond. Leaving questions unanswered is a trust-killer. A simple “thanks for your question, we’re working on it and expect to share a response here by [timeframe]” is always a better choice. And if your timeframe needs to shift, that’s okay, just keep people updated. 

Chip Bergh, CEO of Levi’s, hosts a regular company-wide meeting called “Chips & Beer” — a  three to five minute update on the business followed by a one-hour Q&A, where no topic is off limits, from the coronavirus pandemic to the company’s position on gun violence

On Arvind Krishna’s first day as CEO of IBM in early 2020, one of the first things he did was send a message to more than 250,000 IBMers on Slack. To further drive transparency and alignment, he began hosting weekly “Ask Me Anything” communities (AMAs) for employees to interact with him and other IBM leaders.  

“These communities have become a vibrant part of IBM culture. And it’s something that has reinforced our inclusive nature,” says IBM SVP & Chief Human Resources Officer Nickle LaMoreaux. 

“These communities have become a vibrant part of IBM culture.”

Nickle LaMoreaux, IBM

Nickle LaMoreaux
SVP & Chief Human Resources Officer, IBM

Case study: Slack’s digital-first task force

People are often surprised to learn that prior to the spring of 2020, Slack’s company culture was office-centric.

But in the months after COVID-19 closed office doors, it became clear that 1) Slack staff had adapted to working remotely faster and much more effectively than anyone expected and 2) it was time to codify learnings into best practices and determine the future of work, both in the immediate and for the post-pandemic future. 

“The bigger challenge wasn’t the shift to everyone being remote,” says Slack Chief of Staff Robby Kwok, “we were handling that well. What we needed to work through was how to take what we’d learned during the pandemic and apply that to a hybrid work future — where people would be working remotely, in the office, or really from anywhere, and where our headquarters was digital instead of physical.” 

Slack leadership assembled a “Digital-First Task Force” to establish new workforce practices and policies. The group agreed to prioritize the values of flexibility, inclusion, and connection among teams and to leverage both digital and physical/office infrastructure as tools and not end-all, be-all solutions. 

Each member of the C-suite elected a leader from their organization to dedicate time to the effort. The resulting group spanned a cross-section of key functions from HR, legal, learning and development, workplace facilities, program management/operations, and internal and external communication, with special attention to ensuring representation across geographies and demographics.

Over the course of six weeks, the task force worked together through a dedicated private channel for discussion, planning, and sharing drafts as well as a 30-minute weekly “sounding board” meeting to resolve issues and drive decisions and next steps. They assigned sub-groups to resolve the most complex issues like how to pilot office reopenings and whether or not to require uniformity across departments on policies such as the frequency of collocation. They also shared drafts and conversation in a public forum (“#discuss-future-of-work”).  

Along the way, the task force enlisted employee ambassadors — local office representatives from around the globe as well as the heads of Employee Resource Groups — and pushed them to raise red flags with the prompt “tell us how this will fail.” 

At the end of the six weeks, the task force published a set of principles and guardrails that they distributed company-wide through all-hands meetings, announcement channels, and open forums. They also crafted and shared resources for teams and managers, including meeting guidelines as well as tools and processes for assessing office space. 

The biggest surprises along the way? “We assumed all managers would be receptive to our digital-first recommendations, because we had all been working this way successfully for more than a year,” says Ted Getten, Senior Director of Program Management. “But when we rolled out the Digital-First Toolkit, we got pushback from a small but vocal group of managers who had been hoping things would go back to how they were before.”

Their solution: conduct small group listening/training sessions for managers, hosted by task force members. They also enlisted employee ambassadors to record and share stories of what was working for them as well as challenges they were experiencing. 

The task force’s work is ongoing. Most recently, they’re focused on supporting managers to implement the new changes as well as producing more “re-entry tools” for teams, like guidelines for gathering and survey devices for managers to poll their teams for feedback.  

Don’t shut down thorny conversations — but establish a process to triage and manage them to resolution

In a bygone era, managers strove for strict separation between business matters and social issues. But that mindset is a luxury rooted in privilege. 

Squashing hot button conversations or attempting to mandate “neutrality” on political or social issues is bound to backfire. Today’s leaders must be willing and able to maintain at least a working literacy with current events and to facilitate respectful and honest conversations about forces of social upheaval among diverse teams. 

How to do it: 

  • Be thoughtful about what matters to your company. There’s an important element of alignment here across your purpose, your customers, and your employees. This is hard work, and companies can’t and shouldn’t take a stand on too many social issues, or they risk diluting their efforts. What issues matter most to the fulfillment of your broader mission, to your employees, and your customers? Pick one or two and start there.
  • Moderate. Large group conversations require a dedicated moderator who can monitor the back and forth, facilitate respectful communication, and remind people of the expectations for employee behavior, taking care to flag issues requiring more executive attention as they arise.  
  • Establish your process for triaging challenges — and share it, so people know what to expect. Identify the right people across the company to be on standby to help craft responses to hard questions or topics.
  • Know when to intervene. If a conversation is going off the rails and becoming an unproductive distraction, then it’s time to redirect that energy to a more constructive venue. 

Two-way communication is a journey, not a destination. Commit to experimentation and continuous improvement. 

As you adapt to a new more transparent way of working, remember you’re not going to have it all figured out right away … or possibly ever. Showing you’re willing to experiment and adapt will demonstrate to your employees that you’re committed to open, ongoing dialogue. Acknowledging that you don’t have all the answers will model that it’s okay — even encouraged — to try new things, fostering creativity and innovation. 

How to do it: 

  • Experiment. Employee focus groups, executive office hours, a new app integration — try it all and keep what works. Nothing has to last forever; better to try a new method and fail than to let your employee communications channels get stale.   
  • Ask for feedback. From tracking employee participation to surveys to employee listening sessions, invite input on what’s working and what could be better. 
  • Normalize the process of learning and discovery. Be up front when you’re in the process of learning something new, still figuring something out, or changing course.

The old top-down, one-way communication model might have been easier for leaders. But while transparency can be challenging to get right, there’s no question it delivers stronger results — from retaining top talent to deepening employee satisfaction and engagement. 

“Pushing yourself to seek and include diverse perspectives and clearly articulate ‘the why’ behind major decisions doesn’t just result in clearer communications,” says Debbie Lovich, Managing Director and Senior Partner at Boston Consulting Group. “It makes for stronger, smarter policies and, ultimately, a stronger company overall.”  

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