Transparency is currently a hot topic in leadership circles with the looming economic crisis. Anxious about their job security, employees want to know what’s going on at all times. Many leaders have set a precedent for complete transparency, but sharing too much can backfire.
Employees like to be in the know, but sometimes hearing about every little thing becomes like trying to drink from a firehose. Employees don’t always know what information is most relevant to them, and sometimes a single piece of information can become a major source of distraction.
So what’s the litmus test for what you should be sharing versus what you should keep to yourself? The line between honesty and oversharing is going to be different for every company, but here are a few questions you should ask yourself before sharing information with your team:
1. Is this information actually helpful?
One big sticking point for leaders is how much of the company’s financial information to share with employees. Close-knit teams value knowing what’s going on in a big-picture sense. But sometimes sharing the wrong information with the wrong people can be detrimental. While the account services team might benefit from knowing how many clients you’ve lost, it may just cause needless worry for your developers.
As you’re putting together the slides for the team meeting, consider what information would actually help your employees perform better. Whittle down your presentation to the most crucial — and actionable — information. Or, better yet, tailor the information you share to each department.
2. What context or background is needed for this to be understood?
For years, companies like Whole Foods have pushed the envelope by sharing employee salary information. Buffer has taken this a step further by making employee salaries, user numbers, and revenue public.
But blanket transparency without context can be a recipe for disaster. (Just consider the blowback many Fortune 500 CEOs got when it became a requirement for public companies to disclose their CEO-to-workers pay ratios.)
One way Buffer provides context around employee pay is by posting the formula used to determine salaries. When employees understand the criteria that’s used to decide things like raises and promotions, it motivates them to work harder rather than stewing in resentment.
If you’re thinking of making your company’s financials an open book, first consider what context or background you need to provide. Sales numbers and annual revenue are meaningless out of context. If you don’t also share expenses, your team might start to wonder where all the money is going.
3. Will this motivate my team?
As human beings, we don’t always know what’s good for us. Your employees may think they want to know everything, but getting their wish won’t necessarily make them more effective team members. Sometimes information can be demoralizing and cause them to lose focus.
Putting sales on a leaderboard for everyone to see can push your team to work harder. But seeing a steady four-month decline in revenue post-pandemic is unlikely to motivate anyone. Especially bleak information can cause a panic — even if there’s no immediate danger. The result will be even worse outcomes, and employees’ fears may become a self-fulfilling prophecy.
As a leader, it’s your job to exercise good judgment. At times, that means carrying a heavy burden of information that the rest of your team doesn’t need to know. Yes, you have a commitment to your team, but you don’t owe them 100 percent transparency. The best way you can take care of them is to do what’s best for the company.
