Rewarding Transparency Breeds Success — Here's How

Transparency within a company is crucial to building a team mentality, but it starts with what the company gives its team.

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On a recent Friday afternoon, one of our support team leaders made an accidental change to our software application system, eliminating a week's worth of work for about 100 employees. Instead of hiding the error, she immediately owned it, and rather than having 100 people upset with her, she ended up with 100 people pitching in to solve the problem. Everybody had to put in some extra hours, but no one complained. Instead, they were praising her for being on the ball when a problem struck and supported her in solving the problem.

People are always happy to tell you good news, but transparency matters most when the news is information that makes us the most unhappy. To solve problems, leaders need to know about them as quickly as possible, which means they depend on honest and forthright communication from their team. But transparency starts from the top of the company and goes down. I've found that the more transparent leaders are, the more likely their team will reflect that same transparency back to them.

Team Transparency Starts with the Leaders

Transparency goes both ways — from the company to the team, and the team to the company — but it always starts with the leadership team. In the past, I've worked for leaders and companies that expected a lot from me, but when I asked to understand why they were making a decision, often leaders said they were unable to give me that information. I never understood their logic. To be the best that I can be, I need to understand why and where we're going at all times. By making big strategic decisions without sharing the "why" or "how" with us, their team, we were less effective at our jobs and felt like they didn't trust us — which led to a lack of trust in return.

Those on the front lines will likely work with more passion and excitement when they understand how their work contributes to the accomplishment of company goals. Your team wants you to trust them with the "why" and "how" behind how the company strategically forges the future. They talk about their work with enthusiasm because they believe fully in their company's plan and mission. Especially today, that enthusiasm is viral. Happy workers often post online about their jobs and communicate that feeling among co-workers, boosting other people's positive perception of the company. Without transparency from its leadership, however, no one gets that buy-in, belief or enthusiasm about a company, and the whole viral effect is lost.

Transparency Makes for Good Decisions

When an executive has complete transparency into their company — good and bad — they can make better strategic and operational decisions. A leader making decisions with bad or incomplete information is more likely to make the wrong decision. If you have all the right information, on the other hand, even when it's bad news, the next action you take will be based on the legitimate parameters of your current reality, which makes you more capable of taking the next right step.

People who only tell their leaders what they want to hear typically end up hiding facts when things go wrong. Leaders might move on thinking everything is fine and never learn what decision led them to that point. They may end up repeating that bad decision again and again, injecting it into other areas and ending up with more negative results than the initial problem. Airbrushing the truth creates a coverup culture that can lead to poor decision-making, stunted results and dissention within the team.

How to Breed Transparency from Team to Company

Leaders who are 100% transparent are more likely to receive 100% transparency from their team. Every fourth quarter, we share everything with our team — goals, financials, results, objectives, transformation plans — and keep them informed throughout the year with a brief update after each quarterly review. As we grow, especially for new team members who may start off less bought into the company, this culture of transparency is a critical part of gaining their buy-in and helping employees be the best they can be in their specific roles.

Reward transparency by lifting people up and helping them solve their problems. Some companies might have considered writing up a support team member for deleting a week's worth of data. We chose to promote her. Not only did she jump in and admit to her error, but she also ended up being a leader through the process, bringing a solution forward to fix it. We wanted to send a message to the whole team: When you learn from your mistakes, we will build you up. Without a culture of transparency, co-workers may end up talking poorly about someone who makes a mistake for weeks, maybe even months or years. By rewarding transparency, we repaired the damage within a few days.

Transparency within a company is crucial to building a team mentality, but it starts with what the company gives its team. Leaders need to ensure their employees feel comfortable admitting their mistakes by lifting them up and supporting them when they do. Setting that example will make the team more willing to support one another when it happens to someone else. With transparency, leaders can create the kind of culture they need to form a winning team.

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