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Recent studies show that organizations that are more transparent, especially with team members, experience increased engagement, better collaboration, and higher productivity. When everyone is working with the same information and a shared vision, the entire team feels more connected.

What is Workplace Transparency? 

Glassdoor, the employer review site, defines a transparent workplace as “an organization that operates in a way that creates openness between managers and employees.” This may not seem like a revolutionary concept, but a recent Harvard Business Review survey found 58 percent of people in the U.S. say they would trust a stranger more than their boss. 

Communication flows both ways in a transparent workplace. In addition to organizational leaders and managers sharing information with team members, team members are expected to provide constructive feedback to leaders and other team members. Creating workplace transparency and a transparent Organization culture requires effort on everyone’s part.

4 Ways Lack of Transparency Hurts the Bottom Line

1. Strained Relationships

Team members who feel uninformed about the business are less likely to trust their manager and executives. A lack of transparency fosters an “us vs. them” culture where team members don’t feel safe about discussing workplace and personal issues. They may quit instead of bringing their job concerns to management. When leaders and managers embrace honest and open communication, team members have less reason to feel distrustful of their motivations.

2. Misdirection

When team members are uninformed about organization-wide goals, they may make decisions that aren’t aligned with those goals. Working without focus will lead many to frustration, while others may just check out and only put in the minimum effort. Using transparency to promote shared goals helps align the efforts of all team members. When challenges arise, everyone on the team is more likely to step up when they understand what they’re working towards.

3. Limited Input

Leaders who don’t share business problems don’t have the opportunity to tap into their team’s knowledge and experience. In a transparent workplace, team members have a better understanding of issues facing the organization and are free to suggest solutions. Open communication leads to mutual problem-solving that benefits the entire organization.

4. Lack of Engagement

Workplaces that lack transparency typically have lower rates of employee engagement. This observation is backed by a Harvard Business Review survey where 70 percent of employees said they’re most engaged when Organization strategy is communicated on a regular basis by senior leadership. Lower engagement can directly affect an organization’s finances due to reduced productivity, more absenteeism, lower quality work, and a higher turnover rate.

The ROI of Workplace Transparency

Workplace transparency, when implemented correctly, can bring long-term returns. Employees who feel informed about business strategy and organizational direction are proven to be more engaged and involved in their work, have higher morale, and experience less workplace-related stress. 

Every organization has some information that must stay confidential for legal or strategic reasons. Part of the challenge of creating a transparent workplace is deciding where boundaries should be set since sharing too much can be just as damaging as not sharing enough. This also holds true for some employee information that requires confidentiality. Transparency doesn’t require that discretion be thrown out the window, but it does depend on everyone communicating as openly and honestly as possible, with leadership setting the tone. 

“The art of communication is the language of leadership,” as James Humes, a speechwriter for five Presidents, once said. The key to creating a transparent workplace is transparent leadership. Convening everyone on a regular basis to discuss decisions and changes allows everyone to hear the same information at the same time. Since it costs an organization extraordinarily little to become more transparent with its employees, the ROI is unrivaled.


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