Have you ever worked for a company lacking of transparency? For a company alleging transparency but only on what is convenient for sharing? Foremost if used just as a marketing tool?

While reading the Blue Oceans Strategy, among many inspirational paragraphs, there is one in particular talking about why companies are failing in the attempt to translating their strategies into success.

One of many recipes for failure turns out to be the lack of transparency and the lack of alignment between people in the organization, resulting in dynamics that are creating silos. Consequently, thinking and acting in a silo mentality, pushes teams in arguing against each other, limiting knowledge sharing and working for their own interest, not for the collective success.

Organizations of all sizes are affected.

My personal frustration with such organizations is that at the end of the game, they are limiting your professional and individual growth and at the same time even risking to shift your belief to the wrong path.
No matter how much experience or learning you are accumulating in your specific area of expertise.

My point is:
How can you possibly prepare a spaceship, calibrate required resources and set the direction in order to reach the moon, if you cannot see where the moon is?
How can you teach teams and let them grow in the mission?
This question does not apply only to understand the global vision, but to each single initiative and task executed by anyone in the business.

Are we really going to the moon? If so, why? Else, why?!
If people start asking these kind of questions, it is the first sign of something going wrong. From just asking and questioning what is going on, they will quickly end up questioning each single bit.
Let it be budget allocation, HR strategy, promotions, you name it, at some point they will start to not really give importance at any decision taken over the organization and will focus only on their own, creating de-facto silos that are contributing to a toxic environment which can rarely heal unless of a fundamental cultural change begins.

Worse, a response to such events could be to find the best way to get rid of people creating these silos, a perfect example of symptomatic response with the only target to stop the consequence and not to find a cure to the cause. The situation may ease for a couple of months until the next batch of people will start again as the culture and the lack of transparency in the organization did not change.

Together with other causes, it makes it impossible to cultivate systems thinking and ultimately to apply the systemic structure required by any organizations to sustain growth, which should be based on validated learning and a highly collaborative team work.

The Three E Principles of Fair Process

The book, suggests the three E Principles of Fair Process as one way to create a fundamental solution to the issue described. Three E stands for: Engagement, Explanation and Expectation clarity.

Engagement means involving individuals in the strategic decisions that affect them by soliciting their input and allowing them to refute the merits of one another’s ideas and assumptions. Engagement communicates management’s respect for individuals and their point of view. The result is better strategic decisions by management and genuine commitment from everyone involved in execution.

Explanation means that everyone involved and affected should understand why final strategic decisions are made. An explanation of rationale engenders confidence among employees that managers have considered their opinions and have made decisions impartially in the overall interest of the company, even if their own ideas have been rejected. It also serves as a powerful feedback loop to enhance learning.

Expectation clarity requires that after a strategy is set, managers clearly state the new rules of the game. Although the expectations may be demanding, employees know up front the standards by which their work will be judged and the consequences of failure. When people clearly understand expectations, political jockeying and favoritism are minimized, and people can focus on executing the strategy rapidly.

Applying those principles will challenge every part of the business, leaving little space for greed.  Furthermore it can only really work if implemented with an honest and true intention.

Intellectual and emotional recognition theory

Quoting from the book:
“Using fair process in strategy making is strongly linked to both intellectual and emotional recognition. It proves through action that there is an eagerness to trust and cherish the individual as well as a deep-seated confidence in the individual’s knowledge, talents and expertise.

When individuals feel recognized for their intellectual worth, they are willing to share their knowledge; in fact, they feel inspired to impress and confirm the expectation of their intellectual value, suggesting active ideas and knowledge sharing.
Similarly, when individuals are treated with emotional recognition, they feel emotionally tied to the strategy and inspired to give their all.”

How to disagree?

To support such theory it is worth mentioning a recent report from Deloitte, asking Millennials on what they are looking for in organizations:

  • 26% Fair treatment / Loyalty / Employee satisfaction
  • 25% Ethics / Trust / Integrity / Honesty
  • 19% Customer care / focus

In short – the future workforce want to work for transparent and open companies, where ethics and purpose driven leadership is the rule.

Bringing it all together

Transparency is one of the most important values in life as in business. It is the key for consistent and long term success.
People trust, appreciate and open up more when transparency is perceived. It boosts engagement and willingness to take on responsibilities that we would not have taken otherwise.
It creates the base social environment that is most likely going to be driven by humility. People would end up listening more and eventually learn more from each other, rather than protecting or even competing.
It is also one of the key elements require to build a Learning Organization, perhaps a topic worth elaborating in another post.

If you are looking for companies in which transparency is a fundamental core value, you may want to give a look at Certified B Corporations.

B Corps are for-profit companies certified by the nonprofit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency.
Today, there is a growing community of more than 1,600 Certified B Corps from 42 countries and over 120 industries working together toward 1 unifying goal: to redefine success in business.

The level of transparency to apply or demand is up to you, beware of the results.
There is enough choice out there.

Photo by Mariano Mantei