5 Ways to Lead a Transparent Culture in the Workplace

The importance of transparency has been emphasized over and over by organizations and leaders. But lack of transparent culture in the workplace still remains a prevalent issue among organizations.

Studies shows that 55% of leaders believed in their organizational transparency, while only 18% of their employees agreed with the same.

International businesses like Wells Fargo, Volkswagen, BHS, and Tesco have shown us how a lack of transparency can ruin your business reputation within seconds. 

Miscommunication, lack of trust and loyalty, frequent conflicts, false information, lack of belongingness, decreased motivation and productivity, etc. are destined to occur when you avoid workplace transparency.

To save your organization from facing these nightmares you need to embed transparency within your company culture irrespective of what size or field you are in.

What does transparent work culture mean?

“Transparency is part of a strategy for both organizational stability and creating a competitive edge in today’s world.”-Quint Studer

A transparent work culture refers to an organizational environment in which open and honest communication, information sharing, and accountability are prioritized and practised consistently. In such a culture, employees, leaders, and other stakeholders are encouraged to freely exchange information, ideas, feedback, and concerns without fear of retribution. Showing transparency does not only mean transparency in only one aspect but rather it extends to various aspects of the workplace. This includes decision-making processes, company goals, performance evaluations, challenges, successes, etc.

Why a transparent culture is good for your business?

“Organizations that create a culture of openness and fluid information will survive better in difficult economies than those who filter the narrative and constrict the flow of knowledge.”-Quint Studer

Transparent culture at the workplace comes with a wide range of benefits like-

1Attracts Likeminded Talent Pool

When the day-to-day life at your workplace, salary expectations, work ethics, or financial outlook of your organization is made transparent. You are most likely to attract candidates with similar values.

A Slack report shows that  87% of employees hope that their next job would be transparent. 

2Increases Employee Happiness

Few studies show that a transparency culture in the workplace is one of the major factors determining employee happiness. 

3Better customer relationship

Transparent culture in the workplace has a significant impact on customer relationships. In a surveys, 94% of respondents called transparency the greatest factor in brand loyalty

4Encourages better ideas

Transparency invites innovation and ideas from all levels of the organization.

5Better business profits

Survey further shows that consumers would spend more while buying from a transparent organization.

6Increases Performance And Business Efficiency

Transparent culture can help you to keep everyone on the same page. It saves time by putting a stop to turnover rate caused by employee disengagement, mistrust, dissatisfaction, or a lack of belongingness. 

Case Study: How does Hubspot is benefited from a transparent culture?

With transparency as the core of their culture, Hubspot has become one of the top places to work in. Transparency has been an essential ingredient behind their strategic innovation. It has helped their employees understand the top priorities and their own roles in the company’s workings. 

“We fundamentally believe that sunlight is the best disinfectant,”- Katie Burke, Chief People Officer, Hubspot

With its transparent culture, Hubspot has created an environment where employees feel encouraged to contribute beyond what is expected of them.

It has helped them scale with an improved employee engagement rate and employee relations.

How to Create A Transparent Culture At Your Workplace?

Here are the 6 best ways to create a transparent work culture at your organization-

6Conduct open meetings

Communicate effectively during meetings. Open meetings are indispensable for transparent culture. You can kick it off with simple efforts like being honest about decisions, admitting when you don’t have an answer, or acknowledging mistakes.

Make sure all relevant information is readily available to your employees and customers. Create systems to make it happen. You can also consider giving your people access to comprehensive financial reports. 

Make sure everyone has access to the right information. At the same time, it is also important to know when and what information to keep to yourself. 

Don’t forget to provide a rationale for every decision you make. This will help your teams to understand the decision-making process at your organization. It will further foster transparency and build trust.

2Encourage honest feedback

Invite and provide frequent, honest feedback and constructive criticism. Be open to receiving the same. Open feedbacks are necessary to make your teams feel more involved in the decision-making process of the company. 

“Our secret weapon for building the best culture is open and honest feedback.”– Gina Lau

The core benefit of a transparent culture is that it improves the decision-making process. A feedback loop will also provide your teams the opportunity to offer their insights and opinions and can help you refine your future decisions. 

3Give your employees the chance to speak

Encouraging employees to share ideas makes them more engaged, and fosters innovation.

Give your employees the resources to express their thoughts and concerns without hesitance. 

“A lack of transparency results in distrust and a deep sense of insecurity.”- Dalai Lama

Respond to new perspectives with positivity and an open mind. Make your teams feel safe to express their concerns or views openly. Your employees will only communicate honestly when they know that their opinions are valued and will be acted upon.

Proper communication avenues further embolden employees to reach out to you and their peers in case of crisis. 

4Open salaries

Salaries are no more seen as a private matter. Employees desire more information on the salaries.  When employees don’t know how much their co-workers are paid, they end up relying on their imagination to fill in the gaps.

These assumptions often lead to the idea of getting underpaid.

Studies have shown that relative earnings information has revealed that pay secrecy affects employee’s performance and leads to lower job satisfaction.

According to a research, only 17% of private companies practice transparent salary policies, while 41% discourage and 25% explicitly prohibit it.

Companies like SumAll, Whole Foods, and Buffer have openly shared information about their employee salaries.

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Anecdotal piece of evidence gathered from these companies speaks of the positive benefits of open salaries with higher productivity and satisfaction rate of employees.

“When people don’t know each other’s pay, they assume they are underpaid.”- Elena Belogolovsky

Open Salaries At Buffer:

Apart from its unintended consequences (like no more salary negotiations, pay equality, increased number of job applications), an open salary policy and transparency have led buffer to faster innovation, rapid feedback, a just and equitable workplace, and a culture of integrity.

“It makes us live up to a higher standard because we feel like if anyone can see it we want to have a sound reason behind it.” Buffer COO Leo Widrich

5Make it a continuous process

Embed transparency as part of the work culture and make it an ongoing process. Add it to your company policy, and ensure transparency and ethics are part of performance management in your organization. It will help you attract a like-minded pool of individuals whose personal values align with that of the organization. 

A thriving work environment is not possible with people who hide the truth and can’t be trusted.

When you hire people who appreciate and prioritize openness at work they are most likely to exercise it themselves. 

Make your leaders role models. When your employees will see transparency on the part of the leaders they will be encouraged to do the same.

Click here for 18 Best Practices in Performance Management For Start-Ups [With Examples]

Prioritize Transparency Over Secrecy

Don’t look at being straightforward or open with a stigma attached to it. Instead, build an environment of trust with transparent work culture. 

Keep your employees informed about the Ups and Downs of the organization. Even when things are not up to scratch, don’t be scared to communicate the bad news to your teams.

When done right the way, sharing the ups and downs will only strengthen and motivate your teams to work together for a better future for the company rather than damping their spirit.

Follow these steps to build a transparent culture at your organization and open the doors to better customer relations and higher employee satisfaction.