Transparency

Workplace Transparency Is a Boon, If Your Company Culture Is Built on Trust

Nothing could be clearer: Transparency in the workplace isn’t going away. If anything, public visibility into the inner workings of organizations—into financials, operations and the employee experience--is increasing over time. This growing transparency, fueled by social technologies and emerging societal habits of self-expression and data-driven decision-making, can be friend or foe. A force that can help you improve employee relationships, general reputation and bottom-line results, or that can erode your morale, cost you customers and torpedo profits.

How do you make transparency a pal rather than a plague? It’s not as simple as rolling out a Yammer or Chatter tool internally or suddenly urging employees to tweet about their jobs. No, focusing on the tools alone is likely to backfire. Instead, the key is combining transparency technologies and practices with a culture of trust.

The world’s best workplaces are defined by high levels of trust, pride and camaraderie. They are embracing social technologies and increased interactivity. And they are starting to see positive results from greater openness.

Related: Win the Talent War by Opting for Transparency

Transparency is not temporary.

When you combine tools like YouTube, Twitter and Instagram with smart phones equipped to capture photos and video and people’s increased interest in sharing information about their lives, the result is what can be called “transparency technologies.” That is, tools that disrobe organizations and institutions, as people document and disclose what goes on behind what used to be closed doors.

And the transparency technologies are only becoming more entrenched. The number of monthly active users of Twitter has jumped from 30 million at the beginning to 2010 to some 284 million. The number of smartphone users globally is expected to top 2 billion next year, up from 1.1 billion in 2012. It’s not just social media posts that are pulling back the curtain on companies. There are a variety of rankings that speak to a company’s operations and workplace culture, and there are websites that job seekers and the general public can turn to for even more details about pay, benefits and work environment within corporations. Chief among them are employee feedback sites Glassdoor.com and our own Great Rated!

We can expect growing pressure on organizations to reveal their authentic cultures and workplace practices. We’re now in an era when people expect to make big decisions based on solid data. They can research vacation possibilities at TripAdvisor.com, tablet computers at CNET.com and cars at Edmunds.com. Why shouldn’t they have independent, extensive information regarding one of the most important choices they make—where to work?

Foe or Friend?

So like it or not, companies are operating in an era of increased transparency. And they are finding that transparency can be painful. We’ve all heard stories of social media posts by employees that embarrass their employers. The Domino’s Pizza employees and their video of gross food additives. The many professional athletes who have cast their organizations in a negative light through unseemly 140-character outbursts. The dirt dished on company after company at Glassdoor.com.

But transparency and social tools can be a boon as well. For one thing, when leaders share information about strategy, key decisions and financial health, they can improve overall alignment, workforce morale and productivity. In addition, encouraging employees to talk about the organization in responsible ways can improve the firm’s reputation in the minds of consumers, investors and potential job candidates.

You can boost collaboration, and therefore innovation and productivity, by fostering the use of social tools. McKinsey Global Institute estimates that, by fully implementing social technologies, companies have an opportunity to raise the productivity of interaction workers—high-skill knowledge workers, including managers and professionals—by 20 to 25 percent.

But there’s a secret ingredient to making transparency your friend: trust. Without trust, prompting employees to take to Twitter may not lead to much in terms of positive posts and could backfire in the form of damaging comments. Without trust, social tools aren’t likely to lead to much worthwhile collaboration, as employees horde information and remain suspicious of peers and managers.

Cultivate trust. Do what you say (credibility), treat people with dignity (respect) and treat staff in an even-handed way (fairness). When employees trust their executives and feel empowered by their leaders, good results are more likely in this era of greater openness. In essence, trust and transparency go hand in hand.

Related: Big Organizational Challenges Can Be Overcome With Transparency

How the best do transparency

The best workplaces around the globe are embracing transparency. We see this in part in the results of our Trust Index© employee survey. One of the survey scores that has risen most in recent years among the World’s Best Multinational Workplaces is this statement: “Management keeps me informed about important issues and changes.”

For an example of a great workplace befriending transparency, consider Whole Foods. For years, the food retailer has been building a culture of trust. Employees at the store level have the ability to implement new ideas in a decentralized way, and good ideas can gain traction and quickly spread across entire regions as they rise in popularity. Whole Foods’ social media strategy follows suit. With few guidelines, each Whole Foods store has the authority to manage its own web page, as well as its own Facebook and Twitter accounts. In addition, stores can post to centralized accounts on YouTube, Pinterest and Instagram.

The result is communications with customers that are optimized by the individual stores in the manner that works best for them and their local communities. @WholeFoods has roughly 3.9 million Twitter followers – making them the third-most followed retailer on Twitter.

When privacy trumps transparency

Even the best workplaces, though, must be mindful of taking transparency too far. The next phase of the debate over the “naked corporation” will likely be on limits, and how employers will avoid exposing too much. The best employers will take on the contours of an “Enlightened Organization,” one that welcomes the sunlight of transparency and related insights possible through big data but is wise about protecting legitimately secret information as well as the privacy of employees.

So transparency isn’t a simple matter. But it’s here to stay. And overall, this is a good thing. With a foundation of trust, workplace transparency is your friend.

Related: Radical Transparency Can Re-Energize a Company's Culture and Deliver Results