Executive Podcast #220: Can Leaders Have too Much Transparency?

Transparent leadership means leading with openness and honesty. These leaders keep their team in the loop and share information freely. Where many leaders struggle is on the fine line between being open/honest and oversharing.

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Perry Holley:

Welcome to the Maxwell Leadership Executive Podcast, where our goal is to help you increase your reputation as a leader, increase your ability to influence others, and increase your ability to fully engage your team to deliver remarkable results. Hi, I’m Perry Holley, a Maxwell Leadership facilitator and coach.

Chris Goede:

And I’m Chris Goede, executive vice president with Maxwell Leadership. Welcome and thank you for joining. Whether you’re listening to us via your podcast system or process, or you’re watching us on YouTube, thanks for continuing to join us. We absolutely love getting to do this.

Perry Holley:

We’re on YouTube?

Chris Goede:

We are on YouTube. That’s right.

Perry Holley:

We got an award.

Chris Goede:

That’s right. Yeah, yeah. We were just talking to Jake about that. But we’re grateful for you. This is why we do what we do. And just as a reminder before we get started, if you want to visit maxwellleadership.com/podcast, there you can learn a little bit more about, as an organization, how we’re helping teams around the world, how Perry and our executive facilitators and coaches, our facilitating content, our coaching, moving leaders and teams forward. There’s a form there that you can fill out and one of our teams will be back in touch with you. Or if you want to download the learner guide from the content that Perry’s created for us today, you can do that as well.

Perry Holley:

You can also leave a comment on YouTube. We picked up some really nice ideas, questions, comments, just really mean a lot to hear from folks, so thank you.

Chris Goede:

Yeah, we love it. That’s why we do it. Well, today’s topic is: Can Leaders Have Too Much Transparency? Where are we going today? What are you thinking here?

Perry Holley:

I’ve been in some conversations since we had Tim Elmore on the podcast about generational, the new kind of diversity, generational diversity. I’ve been talking with leaders on our coaching and facilitation and the question comes up around how younger generations tend to require leaders to share more. Actually, if you don’t share, the younger generations will share it for you. They want to hear more from you. And I get the question, how transparent should I be as a leader? Are there things I should share, obviously, but are there things I shouldn’t share? And I think it comes down a little bit to some security in a leader and knowing their position, knowing their role and knowing their team. But I thought it was an interesting topic and I’ve got a couple of examples we may go through. But why don’t you start by how do you see transparency? What’s the definition you’d go by and how would you define it for a leader?

Chris Goede:

I love that you’re bringing this to our listeners. This is so relevant that you don’t even know this. I didn’t share this with you.

Perry Holley:

You weren’t transparent with me?

Chris Goede:

I was not. Right before we got ready to start. Two nights ago, I was on a phone call with a leader inside our organization who is leading a younger generation team, couple different generations. There’s diversity there on the team of that leader. And the question was really around, in essence, how transparent can I be with my team? As leaders, sometimes, not sometimes, all the times we know more than our teams do at times because you’re in meetings where you’re brainstorming and solving problems at a higher level. And the conversation went around of, I feel like at times I’m not being integrous, if I could say that, because of the fact that I’m not sharing potentially everything. And we had a really good conversation about timing of sharing information and what you share, what you can’t share. And sometimes that’s part of a leader’s role and you just kind of have to adjust to that.

Perry Holley:

Just hate to interrupt you, but that the timing is, I don’t let that drop. We can continue. But when we were talking about how to and when to, timing is critical, I think, is one of the linchpins of really transparent communication.

Chris Goede:

Yeah, totally agree. So I love that we’re going to talk about this because I just had a real conversation with a team member less than 48 hours ago. So back to transparency to your question. Let’s define it. So as we talk about this, if you become transparent, there’s no doubt that leads to a lot of openness, a lot of honesty in inside your organization. And I think when you keep your team in the loop and you share information, again, at the right time and what you can share with them, that, no doubt, shows transparency. And it does lead to that openness and the honesty with the team.

There is, back to my illustration, there is a fine line between what not only peer-to-peer you’re sharing, but leader to direct report or even maybe sometimes the other way around direct report to its leader, where the fine line goes between being open and honest and maybe oversharing. And so it is this delicate balance. And as you started with the multi-level of generations inside organizations, they all receive information a different way. They all share information in a different way. And so this is something we got to talk about.

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Perry Holley:

As I heard this comment, I thought from a baby boomer generation, which I am in, they think we would kind of keep a stiff upper lip and just keep your head down and don’t say a whole lot. Whereas the different, as you come younger and younger, they just expect this openness, that there are no secrets almost. And so there’s got to be like, I love the fine line. And I know it feels risky sometimes when a leader starts to talk. I’ve had this myself when I know some things are going on in the organization, there are maybe even rumors going on about what’s going on in the organization. How much do I share? When do I share? But people are looking to me to share and it feels risky, but you ask yourself, is it worth it? And I’ll give you my opinion or point of view on what I think why you need to be more transparent, but I’d love to hear your thought because you’re in the middle of that.

Well, we talk about an inclusive leadership, making people feel like they belong here, like they’re an insider, they’re valued and they’re safe and we can talk, that sort of thing. I think this transparency idea that really leads to inclusive leadership, I don’t want people feeling like you’re only on a need to know basis and I’ll let you know when you need to know. No, how much can I share? How much can I include you in even the thinking about what we’re doing in the organization and that sort of thing? But there is risk, but is the reward, how do you see-

Chris Goede:

I absolutely think there’s a reward. I think when, I call it the team or the organization’s rallying cry, what I mean by that, whether it’s good or it’s status quo or maybe it’s not good, the team is going to rally around what you share with them and how open and transparent you are with them. So as we talk about maybe even some areas that you can become or start becoming more transparent, here’s a couple things for you. So how is the business doing, really? You’re a part of our weekly meetings, all the numbers are out on the table. And I remember I had someone that was on my team for just a couple weeks and they’re like, “You share all the numbers, the phone calls and the revenue and all the expect …? Yes, everything. I want the team to be aware of where we are and how are we doing as a team and as a business.

Perry Holley:

I just hadn’t thought about that. But yeah, you do. And there’s no need for me to know on those meetings about those salespeople, their weekly metrics, because you hold them to … The activity is important. I just wrote on that by the way, activity, not results. You’re measuring this, but you let us all hear that. And I’m thinking, wow, I’m even hearing what they’re accountable for to you. And so it really opens it up to say, if I ever feel like you’re only holding me accountable for something. No, I actually can see the whole team, everybody’s numbers are on the table.

Chris Goede:

And everybody has different KPIs and I’m held accountable as a leader to different KPIs. And so we talk about that. This is a great one that you put in here. So why are we doing that change? Really? Because change is never fun.

Perry Holley:

I added the word, really.

Chris Goede:

Oh, man. Change is never fun. And that’s when you get kind of the most pushback from your team. Here’s another one for you. What are the biggest challenges we’re going to face in the coming year from your perspective? Really, share that. What is. And I’ve started sharing this.

Perry Holley:

This is where I got that one.

Chris Goede:

We’re from an economic standpoint in the US where inflation and some other things we’re dealing with, and some businesses already in Q4 are saying, “Hey, we’re just going to wait a little bit.” And I’m sharing that. I see it, I read about it and I share it and ask my team to be very, very transparent as well. Here’s the deal. As a leader, if you don’t go first and you aren’t transparent, those that are closest to the customer, that are closest to boots on the ground, why would they be transparent with you? And if you want to more effectively lead your business and your team, then you need them to be transparent with you. And so you say this all the time, leaders go first. So we need to make sure that as leaders that we’re doing that.

Perry Holley:

It’s not only an engagement builder, but it’s a trust builder, that we are on the same page. And I hear this on coaching calls a lot about what’s 2023 and 2024 going to look like? If you watch the news for more than about 60 seconds, you realize there’s a lot going on and there’s some negative forecasts, there’s some medium forecasts. I haven’t heard many positive forecasts, but people, they hear. They know what’s going on and so they’re looking for you to lead, they’re looking for you to share. And you say, well, I don’t have all the answers. What do I do?

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Chris Goede:

Let me say this, I can’t remember who I learned this from. It may have been Andy Stanley. We’ve said this before where your team, your team doesn’t necessarily care at times what you say, they just need to hear your voice. That was really during the pandemic that I think Andy was brilliant on. But it may have come from something I learned from him where he said, “Make this statement, “This is what I know as of today. This is what I’m 100% sure about today.” You don’t have to guess about what it’s going to look like and be transparent about what maybe your thoughts are, what the leadership team’s thinking about. “This is what I know today, this is what we’re responsible for, this is what we can build off of.” And so use that statement and that will begin to show that you are being transparent with the information that that is for sure today.

Perry Holley:

Well, I have a situation that came up on a call. The leader said that, and it was related to generational, again, that the younger generation, being very transparent about their salaries and they were sharing openly with each other and collecting kind of a spreadsheet type thing, collecting everybody’s salary and it was causing some churn on the team. Those that made more were feeling pretty good about themselves, those that made less were not. And a lot of questions about why does that person make more than me? And this transparency was causing the leader, the leader wasn’t being transparent about the salaries, the people took it on themselves.

Chris Goede:

With each other.

Perry Holley:

To be transparent about their salaries. And the dynamic, and I thought about it from a generational point of view, that a baby boomer, mortified, we would never do that.

Chris Goede:

When you said churn, my stomach’s started churn right now thinking about it.

Perry Holley:

And then you’re an X.

Chris Goede:

And I’m an X.

Perry Holley:

And you say, “What? They did what?”

Chris Goede:

That’s right.

Perry Holley:

But then you think Gen Y, millennial kind of eh, well, whatever. And then Z is kind of saying, “Heck yeah, buckle up, buttercup, here it comes. We’re going to share everything we got.”

Chris Goede:

That’s right.

Perry Holley:

And so what’s a leader to do in that situation? And I asked this person, it’s a coaching call. So I said, “What do you think about that? What do you do about that?” And he said, “Well, I wanted to fire them for sharing information. You’re not allowed to do that.” I thought, “Well, wait a minute, you need to check the National Labor Relation Board rules. There are laws and they can share that. That’s not illegal to do that.” That’s in the United States. If you’re listening outside of the United States, I don’t know. But here you can talk about things like that. So I’m wondering if you think about, the leader wants to be transparent and let’s just talk about salaries and if that’s going to be a trend going forward, if people are going to do more of that, what do you do with that and how do you handle that?

Chris Goede:

When you shared this with me, I began thinking, “Wow, that’s interesting.” And I can begin to comprehend that as we are moving forward with different generations and the conversations that come up inside of teams, I go, “Okay, maybe I could see that. Definitely different than when we were coming up. But that doesn’t mean it’s wrong, it doesn’t mean it’s different.” So I started to do a little bit of a digging, a little bit of looking, and I want to bring some percentages to this. I haven’t shared this with you either, but I haven’t been very transparent prior to this meeting.

Perry Holley:

I’m really shining a light on something.

Chris Goede:

So I was like, man, okay, so this was on a coaching call for you, so this is a real thing. It’s really, really happening. And then tying it to Tim’s conversation, I was like, “I got to do a little bit of looking into this.” So I found a couple percentages that I thought that would be interesting for our listeners. With coworkers that have shared, similar to the situation you’ve talked about, that have shared openly with their compensation. Now, what’s ironic about what you just shared with these statistics is, as I’m going to share them, you’re going to see the statistics continuing to go up of more people that are sharing this. So 31% of the survey that I read, 31% of the Gen Xers said that they have actually shared some private information about their benefits with-

Perry Holley:

Gen X.

Chris Goede:

Gen X, yeah. Then Gen Y are millennials, 40% of them. So we’ve gone up 9% from different generations, have shared their benefits package information from about their work with their organization. And then Gen Z is up another 2%, it’s 42% have shared. And so when you see the trend on where it’s going, and as I was reading the data, that’s the last benchmark that they’ve had. And so when you look at this, you go, okay, it’s going to continue to increase. So how do we go about this? Because if we don’t have some type of structure around it, it is not healthy for organizational culture, to your point. Well, it doesn’t matter what side of the scale you’re going to be on, it is not going to be something that enhances the engagement level of the team and of the organization. It’s going to be troublesome. You’re going to have jealousy, you’re going to have inequity among coworkers.

And so most of the people that are not in charge of placing those benefit packages in front of our team, most of the people that they make a lot of assumptions, they really don’t know what the difference is in education, in certifications, that their experience, their training, they don’t know all the details that an organization has looked into as they hired someone that has come along. And so we’ve got to be very intentional as we’re thinking about this. Whether this is you as a leader, whether this is the HR department, whose ever responsibility it is inside your organization, we have to be intentional about having a compensation strategy.

Perry Holley:

That’s it right there.

Chris Goede:

If you don’t have that, you’re going to have a lot of ums and wells. And there’s going to be a lot of what I call at times the gap of wonder, when people are just wondering why Perry is being compensated this, and Chris is being compensated that. What do they do, they put a negative spin in their mind about why that gap’s there compared to maybe the benefits package that they’re receiving. And so I think if you have a strategy so that when you begin to initiate the compensation, the benefits package of why, then you have something to stand on. And that is something that also you can explain to not only the individual, but then if someone else comes to the leader or the HR and they want to know, “Hey, how are decisions made around compensation? What does this look like? Is it tied to the job description?” You have something as a framework to stand on and point to, and then it becomes very clear.

Perry Holley:

Well I worked for IBM for a number of years, as known. I was a leader there and I had to give raises and defend compensation and payments and rewards and commissions and all that kind of stuff. One thing they had gone to was, to your point, to really not just having whatever salary you when you offer. You had actually had a plan, a compensation strategy for every role and responsibility, every organization in IBM had. There’s a known market range of what roles like this in the market are paid. And this also helped with the inequities between men and women to say, it doesn’t matter. You’re in this range and your skillset and your experience level and where you are in this organization, here is your market range.

Now, we have people that come in from the outside. By the way, this is, if you’re a leader that’s hired during the COVID years, you more than likely paid more for talent than you might normally have done. So you might have some inequities in the pay structure that you may have to explain if you get into this. But what IBM did was, they said, here’s your market range. And so when I would review their compensation with them, they would be in the range. And everybody wanted to make more. Nobody thought they weren’t paid enough. But I would say, “In the market range, you are 75% of market range for your title, which means there’s room in there for you to get a raise. And so here’s your progression, here’s how you would do that.”

I had people that I would say, you’re 110% of market range, and so I’m giving you a small raise because technically you’re overpaid. That’s a hard thing to say to someone, but that was very transparent to say, here’s how we determine what we pay in this organization. And now people can say, well, I think I can make more somewhere else. I urge you to go try, but you’re not. This is what we’ve done, the research. And that’s what the strategy and the compensation strategy was to know that it just wasn’t something we just made up and now everybody’s paid differently. We have an organization that just went, that they decided on their own to make minimum wage for their organization, $15. They’re not required to do that, they just did. But then they had to look at, well, what about everybody that’s been here for a long time that has worked their way up to maybe over the years to getting to 15.50 or 15.75 an hour? And now everybody that comes in just boom, all the way to 15, do you need have a strategy?

How transparent are you going to be about the rest of the people that have been here? You have to have a strategy to do that. So do people know where they are, how it’s measured, what the progression is to go to the next level? And I think then becoming transparent is just, this is it. It’s on the table. We don’t share the actual salaries of people, but here’s how you were paid. And I saw some organizations that do share all the salaries, they just from the top to the bottom, here it is. And they put it out. And I thought that could cause some problems, but it’s also erases a lot of questions, like you said, the wonder.

Chris Goede:

Yeah, the wonder gap. I have a client of ours that works for a big organization. And similar to what you’re talking about, there’s a scale, they have a strategy. Now, the negative side of that is, to your point, when people come in new, they can jump a ceiling that maybe people have been there for a long time. And the frustrating part about it, because the organization is a big old boat and it takes a lot to move it, they have to go elsewhere and then reenter into the organization to be able, so it is complicated.

Perry Holley:

The best way to get a raise is to quit and come back.

Chris Goede:

Yeah, come back. They’re loudly quitting and quietly trying to come back, with all those phrases. But what I love about this is, if you have a strategy, it increases transparency and that your team, your people, they’re comfortable understanding kind of where they’re at and the salary range and the potential. But also what I love about this is that if there’s a strategy, you can also talk about what would it take to get you to that next level, that next number of salary range. Could it be additional certifications that we would love to, by the way, pay for you to go through or additional training. Whatever it might be within their company, that’s got to be part of the strategy as well, versus just saying, no, no, no, this is it. This is where we’re at, but this is also how you can then grow your compensation or your benefit package.

Perry Holley:

I was wondering, going away from the salary conversation, but just back to general transparency, is your thoughts about how to become more transparent? Some people just aren’t comfortable with sharing things with people, not knowing what they’re going to do with it. But I wonder if you and your growth as a leader, how have you, and don’t surprise me anything here, but just how do you get more transparent? Just start small or what would you coach a leader if they wanted to grow their transparency with their team?

Chris Goede:

I like your idea.

Perry Holley:

That fine line.

Chris Goede:

Yeah. I like your idea of starting small, but here’s what I do, ultimately. We talk about from leadership that, hey, everybody deserves to be led well. That’s what we believe here at Maxwell Leadership. And if you need to lead everyone a little bit differently, we know that. However, when it comes to something like this and transparency, this is the question I ask myself, “Would I want to know this if I was on my team?” Almost kind of removing myself from the leadership role, sitting in my team meetings, going, “What would I want to know? What should I know? What should I share?” And then I just trust my gut and trust my instinct and I’ll write that down. And then when I’m with my team or I’m one on one with somebody, I go, “Hey, I just want to kind of share this with you”, and I do it. And so I just kind of try to put the hat on as if I was sitting on the other side, would I want to know that information.

Perry Holley:

I think that’s good. And I know I need to get you to wrap up, but I think this, you can be perceived as holding back from people. You can be perceived as only telling people the minimum and that you know more, and they don’t. And there’s some things, that’s appropriate, but in general cases, most people understand that you can’t share everything. They just want you to know that you’re being open with me. That’ll increase my engagement, my buy-in, my participation with you. I want to be rowing in that boat with you and know that you’ll let me know. I know that you’re that kind of leader that you’ll tell me.

Chris Goede:

As a leader, you don’t want to be where your team feels like that you’re keeping secrets from them. And I think that you’re authenticity and your vulnerability will open the doors for additional communication and conversations. And also increases trust, which is kind of how you started this whole thing. And trust is the currency to all influence, which we believe leadership is influence. And so you need to make sure that your team does trust you. The other thing I want encourage you to, you say, man, this feels so level two-ish, in our words of five levels of leadership, which Perry and I kind of naturally gravitate to, where you connect with and you lead your people. But I promise you that if you’re more transparent, you will drive higher performance, higher production out of your people.

Again, back to my comment about you’re creating a rallying cry for them. And I think remember this, ultimately, if your team’s not performing, leader, you may not have a job. You may not be worried about. And so ultimately, isn’t it interesting that on the back end of being transparent, if you’re not, it may ultimately come to your team not performing, and that is going to be your responsibility. So start small. What would you want to know on the other side of you? What does it look like to be on the other side of your leadership when it comes to communication and transparency? And then trust your instinct and do that.

Perry Holley:

Fantastic. Well, thank you Chris, and thank you all for joining. Just a reminder, you can get the learner guide for this episode. You can leave a question or a comment for us. All that at maxwellleadership.com/podcast. We’re very grateful that you have spent this time with us. That’s all today for the Maxwell Leadership Executive Podcast.