Evolution of Human Capital Management: Our Role, Our Emerging Responsibilities

Part Three: Transparency: When is information “enough”?

This is the third article in a series of six focused on the Evolution of Human Capital Management.

We interview management and leadership candidates routinely. Many of us employ behavioral interviewing techniques and ask, “Tell me a time about how you led through a difficult period.” Usually, we follow up with, “Tell me about your leadership philosophy.” The last ten times I asked these questions, I was told in one manner or another, “I am a transparent leader, authentic … believer in telling it like it is.”

The truth is that 100% transparency is neither achievable nor advisable. A friend and colleague asked me to sit on a panel to interview finalists for an important not-for-profit leadership position. This particular organization is routinely in the national news, under political, economic and cultural scrutiny. Their mission is viewed by some as critical to our Nation’s well-being, others see it as a challenge to our way of life. Leadership style will be critical to the effectiveness of the individual who assumes this role. When asked, one finalist proudly stated their intent to share all, with all, at all times (her motto). The pregnant pause that ensued demonstrated that each of the panel members were struck by a wave of self-reflection: is this a good thing for our organization? Do we really want/need to share all with all? During our recap session, our dialogue focused not on the candidates, rather how much information was appropriate to share as well as: who do we share with and why?

Transparency can be viewed as a construct or an approach that impacts three distinct levels of interaction. Each requires a distinct approach or conscious consideration of the application of how information will be treated.

  • Organization – You’ve heard leaders stand up and detail corporate strategy, downsizing, merger and acquisition plans, the very essence of plans for moving the organization forward. The key is this: the more transparent leadership speaks, the more will hear the message – competitors and customers alike. Does an organization want their competitors to hear about breaking into new markets? When should customers be advised that price increases are in their all too immediate future? Clearly these sensitive topics are good examples where caution must reign. There is a time and place to unveil certain information. Is caution lack of transparency? The key here is that moderation is the prevailing objective – and organizations need to apply care on divulging too much, or too soon. 
  • Leadership/management – We’ve all been party to the proclamations where leadership announces, “The turnaround is in full swing. Recovery is well on its way.” “There will be no more layoffs.” “I’m here for the long term.” When these statements are made, the intention is to lift morale, encourage, energize or otherwise reduce tension. Yet, wherever we lead, we are constrained by the environment (market forces, competition, changing dynamics internally), externalities (think global economy, technology introductions, natural disasters) and relationships (Board of Director members, political allies, friends, enemies and “frenemies”). Never make promises that aren’t in your power to keep.
  • Personal – In our work, human capital professionals are privy to confidential information which by law, by practice and in reality, just plain good judgement must be held tightly. Are we less than transparent when we hold things close to the vest? We’ve all been asked, “Who’s getting the promotion?”, “Will my job be impacted by the re-organization?”, or “Do you know what Brett makes?” As partners to the organization’s leaders, we often know sooner than others, information that may impact those closest to us and even our own teams. We cannot be transparent in all cases – yet that doesn’t have to mean to don’t operate transparently at appropriate levels.

So, you ask, what are the rules? How can I be transparent without violating the trust others impact to us? Let’s be clear: transparency is not one size fits all. Discernment is critical. Here are some simple guidelines you can consider for crafting boundaries around transparency:

  1. NDA: If you need to sign a non-disclosure agreement (NDA) to obtain information, you must guard the material intently. Clearly, NDA’s are legal, binding documents which dictate who gets what, and under what conditions. Treat the material seriously – NDA governed topics are never fodder for debate or discussion during Friday night happy hour, during cell phone conversations in an airport or at the gym.
  2. Broad statements: Broad statements are just that. Think of them as soundbites, morale commercials or paid “political advertisements”. They are deliberately slanted as they are being offered with a purpose. Remind employees: “Yes, that is the current position based on what we know TODAY; tomorrow could bring us an entirely different set of circumstances.” Set expectations up front and often that these sentiments are offered genuinely, however are subject to the environment, externalities and relationship tsunami.
  3. Team Insider Info: Who really needs to know information? Sharing freely has been advocated and in fact, made technically possible with the advent of knowledge management and as social media has proliferated. Tell all, tell now however can have a price. Research has shown that boundaries around not airing “dirty laundry” can in fact aid and abet team problem resolution. Empower teams to work through issues without having them become a spectator sport where taking sides increases tension and potential subterfuge.
  4. Protect the “vault”: Dr. Brene Brown reiterates the importance of maintaining confidentiality when we are entrusted with information. Within organizations, teams, departments or work groups information shared confidentially should be labeled such when one considers it private, avoiding adding inappropriate fuel to the rumor mill.
  5. Employee data:  of any kind – should be treated with the utmost confidentiality. An employee once said, “I’d never tell HR anything – they couldn’t keep a secret if their life depended on it.” OUCH. We may not sign the equivalent of the Hippocratic Oath, however, we should all remember the power of the information in our keeping.
  6. Time:  Transparency about historical events is just that: history. Once something becomes public knowledge, it is public. Transparency can once again apply. However, remember, the closer you are to the thick of things, the more likely you should heed caution about what is shared and with who.

Do we really need transparency for success? Ah, we face that ever present dilemma posed by the double-edged sword. There are limitations to the utility, appropriateness and timeliness of transparency. Sometimes a good thing taken to extreme becomes a liability. We all should be thoughtful about tossing about terms of “good currency” that we should not, nor cannot live up to.

Look for Part Four of our series in two weeks: Dealing with crisis of reputation .