Four Ways Leaders Can Create Transparency in the Workplace

What’s the number one factor that can make or break employee satisfaction scores? Transparency. When an organization commits to leading with transparency, employees feel supported, respected, and empowered to do their best work. At its core, transparency partners perfectly with trust. And right now, workplace trust is at an all-time low. In fact, a Harvard Business Review survey revealed that 58% of people trust strangers more than their own boss. Yet, without a culture of trust, employees will struggle to remain engaged or feel a sense of greater belonging. Emerging innovations in HR technology and people analytics can help build transparency and trust within organizations. Further, using this technology to build connections across teams equips everyone with insights to be more efficient, as embedding transparency and trust benefits not only employees but also the entire company.

The Importance of Transparency in the Workplace Before infusing more transparency into an organization, it’s important to understand its value. Only one in three employees trust their organization’s leadership, according to a Gallup study. This distrust can stem from poor policies or a lack of common culture, leading to vastly different employee experiences. Some teams may be more transparent than others, resulting in inconsistent sentiment across your organization.

This distrust and sentiment mean employees are more likely to have a negative outlook on their company when leaders are not upfront about company decisions, goals, and metrics. Fundamentally, employees want company leaders who are transparent and make data-driven decisions. These leaders should be cognizant of employee attitudes and willingly share details, so their teams feel prepared, supported, and respected. Good leaders understand that when an organization lacks transparency, employees fill in the gaps with their own — often negative — assumptions. Jumping to conclusions rarely generates positive outcomes.

And it is more likely to happen when organizations hide poor numbers, deliver inconsistent messages on company goals, or engage in other deceptive behaviors. A transparent approach equips employees with concrete, accurate information that establishes an organization as a dependable resource. Inclusion is also key to creating a transparent organization. Creating a culture of inclusion also helps employees feel comfortable sharing their true selves. Cultivating a sense of belonging has a positive impact company-wide on employee productivity, motivation, and pride. As a result, more than half of people have an improved sense of belonging at work when they feel trusted and respected, according to EY.

Transparency also helps employees with their own performance and development because they are more knowledgeable of the organization at large. Finally, a culture of transparency helps employees stay emotionally connected, a critical link for remote and even hybrid workers. A standardized people strategy designed to support company-wide communication regardless of how, when, and where people work is paramount to building those emotional connections. Creating a Transparent Work Culture Because of its significance, creating a transparent workplace culture can feel overwhelming. Here are four tips for laying the foundation. 1. Determine what information drives results Beyond the basics, organizations struggle with what to share. A fine line exists between transparency and confidentiality, so companies must plan their information-sharing strategically and with intention. For example, employees should have clarity on salary ranges and their salary band within an organization’s compensation structure. This insight removes the guesswork of who makes what, clarifies different roles, and provides a roadmap for professional growth opportunities. If you choose to share exact employee salaries, proceed with caution. Sharing this level of detail can lead to stress and distraction, especially when it’s not disclosed how each salary is calculated. Sales representatives, for example, may share the same base salary but see a wide variation in gross salary based on earned commissions. 2. Centralize people’s data and make it accessible Once an organization decides what information to share, the next step is to make it readily available. The nature of remote or hybrid work can make it more important to ensure information is shared often and that communication channels are streamlined. People analytics software consolidates and leverages an organization’s data and facilitates easy access for all team members. Storing data in one secure place helps everyone feel more connected by raising awareness of:
Company values and goals.
Hiring plans and their impact on specific, individual roles.
Reporting structure and cross-functional information.
Who their peers are, beyond names and titles.
Context from organized data is a fundamental part of individual and team success. Without context, employees struggle to understand their roles and contribution to achieving company goals. Functional managers can’t support their teams from afar without clear strategies and continuous data.

Instead, investing in a people analytics solution builds connections between multiple systems and aggregates People data so your entire organization can make more informed decisions. See More: Rehumanizing the Workplace in 2021 With an Employee-First Culture 3. Lead by example Establishing a culture of trust starts with the leadership team. Leaders should embrace honesty and authenticity as employees are more likely to engage with leaders when management earns their trust. In fact, employee productivity increases by more than 50% when managers help their reports align their own goals with those of the organization, according to Gallup’s research. This is critical to building a foundation of trust.

Leadership should hold regularly planned company-wide meetings to detail where the organization stands and what’s next, instead of just running through the numbers. If changes occur, leaders should communicate shifts, so employees are never surprised. Don’t forget to provide a forum to submit questions that gives people a place to ask questions. Executives can then address those comments and concerns in an all-hands setting. Next, managers should adopt an open-door policy, making themselves and their decisions available to their workforce. This approach prevents an “us versus them” culture from growing.

A broken and misaligned culture can lead to interpersonal conflict, discriminatory practices, and subpar performances. 3. Scale transparency for growth After executing the first three steps, it’s important to remember that your transparency strategy must change and grow with your organization. The same processes likely won’t work for each stage of growth, but the backbone of transparency should remain unchanged. Leaders should remain flexible and expect to adjust communication and messaging.

For example, a small start-up may share a wealth of information with different stakeholders because, especially in the beginning, the decision-making process involves many people. But at the enterprise level, that number of people naturally dwindles as the decision-making becomes more strategic and involves more executives. It’s the job of stakeholders to strategize on behalf of a company and only communicate what’s pertinent.

An evolving organization must continually revisit and adjust its transparency strategy to maintain the right balance. Survey after survey shows that employees perform their best and feel engaged when organizations create and prioritize a culture of trust. Over time, leaders will uncover the right balance between open information-sharing and confidentiality. And with that balance, organizations can feel confident that their transparency strategy will drive company culture.


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