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Transparency in Leadership

25.07.2014
Discussing Leadership at The Hub http://www.flickr.com/photos/7226683@N03/413006382 (CC)

In the information age, transparency is becoming the de facto standard for business, government, institutions, and other aspects of daily life. People not only want to know where their produce is coming from, but also who is running the grocery store and the other suppliers they work with. The values a company holds and how those ideals shape the decisions they make are important to customers and employees. Technology have made it easier for individuals to crunch through large amounts of information, and now everyone is demanding transparency in leadership in order to make informed decisions.

Background on transparent leadership

Think about the world before the Internet and the dawn of the information age. Most people were too busy with their daily lives and work to care about the buying decisions of their local supermarkets, let alone the salary scale used by far-flung fledgling companies. People still work the same 40-, 50-, 60-, even 80-hour jobs per week they did only a few decades ago. However, during their downtime, people today can very easily research any subject they wish. What would have taken several months to collect data, read reports, and crunch number, can now be done in just a few hours.

Even more disrupting is the ease with which information can be distributed online through blogs, websites, and social media. The Internet has created a society hungry for information and eager to dig into every aspect of the companies and brands they support - including their leadership. Back in 2012, Forbes came out with a list of five things that transparent leadership provides:

  1. Faster problem solving
  2. Easier team building
  3. Authentic relationship growth
  4. Promotion of trust in leadership
  5. Higher performance levels

What is happening with transparency in leadership today?

Today, with a smartphone in the pocket of almost everyone in the world, it is easy to look up information about any product or service before making your purchase. Take a look around any department store, supermarket, or shopping malls, and you will find in-store media flooded with URLs and QR codes enticing shoppers to learn more about products, services, and companies.

In the past, companies were scared to share wage information, in part, because they did not have a uniform way of calculating anyone’s salary. Each employee negotiated the best wage they could and many times this lead to disparities in wages. Today, there are companies like Buffer that are becoming role models for other companies developing transparency in leadership. They have developed a formula for determining the salary each employee receives. This makes it easy to open up the system and let everyone know what members of their team earn. Since it is a simple equation and not a black box, open salaries at Buffer it just make sense.

Steps to improve transparency in your organization

The Harvard Business Review has published a recent blog post that points out why leadership is becoming more uncomfortable. They suggest that new technologies, new markets, new cultures, and new stakeholders are all making it more difficult for business leaders. In addition to all these concerns, they point out that increased transparency makes the situation more complicated. Transparency is a double-edged sword. It can make leadership more difficult if your target market and stakeholders are criticizing your decisions, often without the information to understand how or why decisions were made. However, when you are truly aligned with the values of your market, transparency can accelerate your business to new heights. Here are a few steps to take when moving toward a more transparent leadership style:

  1. Ask what your customers want, then deliver.
  2. Admit when you make a mistake, then correct the problem.
  3. Consider the value you are bringing to your customers and employees, and ensure you are creating a win-win situation.

Do you consider your company to have transparent leadership? How has transparency in leadership affected the way you work?