Four Reasons to Embrace Openness and Transparency at Work

 

How defaulting to transparency helped these companies build the trust, accountability and profitability needed to succeed in today’s business climate.

 

In a 2015 study, performance management firm 15Five found that most employees want to work for a company that values openness and honesty above all else, but that few are lucky enough to get it. Eighty-one percent of workers, according to the study, believe that corporate transparency is more important than any workplace perk, but only 15 percent are very satisfied with the level of communication within their offices.

“Clearly, companies have a lot of work to do to foster open dialogue,” said David Hassell, CEO of 15Five. “If teams aren’t communicating with honesty, clarity, and respect, then their companies won’t thrive; finding ways to bridge generational divides, encourage honest feedback, and improve transparency will go a long way to boosting productivity, morale, and profits.”

Two years later, management transparency has become one of the distinguishing marks of forward-thinking corporate offices, and multinationals like Whole Foods have won greater trust from employees by disclosing salaries and other information across their firms.

Here we take a look at four ways companies have taken transparency one step farther, using it as a tool not just to build trust with their employees, but to increase productivity as well.

1. Open Financial Information Makes Everyone an Executive

At HubSpot, a software company based in Boston, every employee is an insider. The company went public in 2014 — a move that often means the end of freewheeling, creative startup culture and a move towards a corporate structure where lower-level employees are kept permanently out of the loop. HubSpot went in the other direction, however, giving every employee access to financial information that’s normally available only to those in the C-suite.

The goal was not just to engender trust, but to give lower-level employees the information needed to make decisions that could benefit the company as a whole, and the result has been employees who are more engaged and more productive than ever before. When employees know everything that their bosses know about where the company is and where it’s heading, they don’t wait to be told what the company needs — they just do it. “The vast majority of ideas have nothing to do with me,” says Director of Talent and Culture Katie Burke. “They come from other employees.”

“If a lot more people have a lot more information, they’re better able to make decisions themselves instead of waiting for instructions from someone above them in the hierarchy who supposedly knows more than they do,” MIT’s Thomas Malone told the Boston Globe. “When you are making decisions yourself, you are often more creative, more highly motivated, able to be more flexible, and often you just plain like it more.”

Most companies share some level of their financial data with employees, but few take it as far as HubSpot. Another Boston-area company that’s embraced total transparency is Apptopia, which displays financial data that most firms would consider top secret on a bank of video monitors in the building’s lobby. Apptopia also provides employees access to everything from monthly revenue to client information at their desktops, allowing them to know precisely what clients need and adjust their approach accordingly. “When you have nothing to hide,” Apptopia CEO Eliran Sapir told the Globe, “things are going really well.”

2. Share Your Emails, and Cooperation Will Follow

If there’s one thing that people guard even more tightly than their corporate financials, it’s their emails. And yet some companies have found surprising success by opening some or all of the email sent on company servers to anyone within the company. Online payment company Stripe allows its employees to access any email sent by anyone else at the company, with the exception of threads with an outsider who requires his information kept private.

“Initially, the motivation for having all email be internally public and searchable was simply to make us more efficient,” wrote then-CTO Greg Brockman in a 2013 blog post announcing the program. “If everyone automatically knew what was happening, we needed fewer meetings, and our coordination was more fluid and more painless if we could all keep up with the stream.”

What started as an efficiency effort became an ingrained part of the company culture. Open email prevents siloing and allows employees in one part of the company to learn how other aspects of the business work. Stripe believes so fully in the practice that they’ve shared a lot of information about how they make it work so that other companies can follow suit.

3. “Default to Transparency” to Avoid Surprises

When it comes to birthday parties, surprises can be good. But in a corporate  setting, big surprises can mean disaster. When social media company Buffer was launched, co-founders Leo Widrich and Joel Gascoigne found that they had a natural inclination towards transparency — tweeting details of the company’s early days, inviting new hires into top-level meetings and requesting input on all aspects of the company from everyone who works there.

“For us, transparency came quite naturally,” writes Gascoigne on his blog. “Myself and Leo always felt very comfortable and excited to share our learnings. It helped us get more feedback about decisions and it was a way to help others who are getting started.”

They found many unexpected benefits from this approach, and one of the most important has been that the more transparent a company’s workflow, the easier it is to avoid surprises — good and bad. Buffer employees track everything they’ve accomplished throughout the day on a group messaging board, allowing anyone to see at a glance if a project is getting behind, or if there is any other trouble coming down the road.

4. The Most Important Part of Transparency? Listening to Your Employees

Zingerman’s Deli in Ann Arbor, Michigan, is known for great slow-cooked meats, killer sandwiches and a starring turn in the Jason Segel romantic comedy “The Five Year Engagement.” But in business circles, Zingerman’s is known as being on the cutting edge of Open Book Management, a form of institutionalized transparency that invites employees across the company to inspect the books, and contribute to decision making large and small.

“Anyone throughout any organization is making hundreds or thousands of decisions every day, but they’re missing a lot of information,” CEO Ari Weinzweig tells OpenWork. “There’s a lot of wisdom that everyone brings to the table, so when you exclude 80 or 90 percent of the people, you’re going to diminish the quality.”

Named “The Coolest Small Company in America” by Inc. magazine, Zingerman’s Open Book approach gives employees a feeling that they share in the company’s destiny, and have the power to shape its future. Weinzweig likes to tell the story of the dishwasher who noticed customers throwing out most of their french fries, an observation that prompted to cut the serving size in half, and offer free refills to anyone who wanted extra. The change saves Zingerman’s thousands each year, and underlines the idea that transparency is more than a nice idea, but a way to reshape a company from the ground up.

“Once in a while, I wonder what it would be like to work for a traditional company that clearly defined roles and kept information in silos,” says Zingerman’s web developer Billie Lee. “It would be so easy, and I wouldn’t have to worry about anything except what was right in front of me. But I don’t think I could ever go back. Ignorance is bliss, but knowledge is power.”

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