How To Create A Culture Of 'Shameless Honesty'

Dreamhost, Zappos and other innovators realize complete candor means a better business with happier employees.
President and Founder, Clarion Enterprises Ltd.
October 09, 2013

In a recent interview with The New York Times, Simon Anderson, CEO of website hosting company DreamHost, used the expression "shameless honesty" to define one of his company's values:

"You can be sitting in a meeting, and you can say, 'I’m going to be shamelessly honest here.' ... Now there’s respect, and it’s not rude honesty. It just gives us permission to have those hard conversations and get to a point where the elephant is not in the room."

Shameless honesty is unabashed candor. It's transparency. It means no sugar coating and no sacred cows. It means everyone has a voice and can speak candidly for the good of the company—no one avoids the difficult, necessary conversations for fear of retaliation. As Anderson puts it, "Culture is debate. It's argument. It's messy, and for culture to be strong, people have to be ... challenging each other."

There are many benefits to having a culture of candor where subordinates are free to speak openly and where critical information flows freely to the right people on a timely basis. This open flow of information is essential for a company to solve problems effectively, to innovate and to compete. It maximizes a company's chances of success.

A Culture Of Candor

As Warren Bennis notes in Transparency: How Leaders Create a Culture of Candor, this is particularly true "when the information in question consists of crucial but hard-to-take facts, the information that leaders may bristle at hearing—and that subordinates too often, and understandably, play down, disguise or ignore. For information to flow freely within an institution, followers must feel free to speak openly, and leaders must welcome such openness."

Leaders who make it safe for people to speak up without fear of ruffling any feathers manage companies that promote total transparency. Take Buffer, for example. This social media startup has chosen “Default to Transparency” as one of its 9 Buffer Values, words that define the company's culture. This guides employees to always state their thoughts immediately and with honesty, and encourages them to share early in the decision process to avoid "big revelations." How often have we worked on a project in which someone who had crucial information didn't reveal it until the project was already well underway, resulting in negative consequences that could have been avoided had the information been available sooner?

Another example of a transparent company is Asana, which makes a web and mobile application for team communication and collaboration. The company thrives on a culture of transparency, and that makes its teams more productive. In an interview with Fast Company, founders Justin Rosenstein and Dustin Moskovitz call it "transparency 'til it hurts." One way they make it work is to openly dissect and publish trouble spots before it's too late by using the “5 Whys,” the Toyota method to figure out how to improve future projects. “At some companies, that can be scary," Rosenstein says, "but our culture is set up so we all respect each other. It's not a blame game.” This taps into another of the company's values—Encouraging everyone to admit when they're wrong.

Of course, any business—not just technology companies—benefits from establishing a culture of candor. Take the legendary Zappos, for example. One of its core values is building open and honest relationships with communication. No group think here: The company embraces diversity in thoughts, opinions and backgrounds. On its site, where the company outlines its core values, the importance of communicating is emphasized: "We want everyone to always try to go the extra mile in encouraging thorough, complete and effective communication."

Another example is Namaste Solar, a solar panel installation company that promotes "Distributed Leadership" as one of its pillars of co-ownership. This is explained on the company's website as valuing "the unique gifts and perspectives that each individual contributes to our company; no one of us is as smart as all of us."

Open Communication

Of course, a culture of total candor isn't without its risks and challenges. For one thing, it's not possible to make all information wide open, nor should you. Creating a culture of candor entails educating people to use information responsibly. For example, competitive information needs to be guarded, and the privacy of customers must be protected. If you're interested in creating a culture of candor, these additional guidelines can help:

1. Conduct a culture survey. Seek feedback on employees' perception of the company culture. Do people feel safe bringing up unpleasant truths or unsettling news? If not, what are their reasons for not doing so? Use the intelligence you gather to address any problems.

2. Set the example. As with any values you're trying to instill in your company, it always starts with you, as the leader. Don't hoard information. As Bennis notes, "Some executives seem to take an almost juvenile pleasure in knowing the organization’s inside dope and keeping it away from their underlings ... knowledge is viewed as the ultimate executive perk."  As well, show others with your own behavior that it's OK for people to push back. This will send a clear message that you're taking this seriously.

3. Designate a "Yoda." In a Harvard Business Review video on encouraging candor at work, Keith Ferrazi reports on research that shows candor as the best predictor of high-performing teams. One of the techniques he suggests to encourage candor is to designate a "Yoda." This means appointing one or two people in the room to be official advocates of candor. Their job is to notice and speak up when something is being left unsaid, and to call out someone when their criticism is nonconstructive or disrespectful.

4. Educate people on how to receive unsettling news. If a culture of candor is to succeed, all managers and other supervisory staff must abandon a "shoot the messenger" mentality. It's not easy to hear negative feedback. You need to educate your people on how to handle an employee who candidly delivers bad news, even if it's about the manager's own department. The companies we see that have such policies emphasize the importance of respectful communication by either party.

This is especially crucial if you have leaders who have narcissistic personalities. These are people whose arrogance leads them to believe they know best and they refuse to listen to anything negative. "There's a marvelous Middle Eastern phrase about leaders who've stopped listening," Bennis says, "They say, 'He has tired ears.' That's arrogance." 

5. Be open to a diversity of information sources. Leaders often have a tendency to rely on information from a few select employees. Those who have "the boss's ear" might have personal agendas, and you might end up with biased information. Contrasting opinions will help you see the different facets of important issues that you may have otherwise missed. Make sure you and your managers stay open to a number of sources of information from every corner of the company. For example, those closest to the customer, regardless of their level in the company, can provide valuable information to help you improve your products and services because they're getting feedback directly from the end users.

6. Reward contrarians. In A Culture of Candor, authors James O'Toole and Warren Bennis provide eight recommendations for establishing transparency, one of which is rewarding contrarians—the brave individuals who point out imperial nakedness. Value these people who challenge your assumptions and show you where you might be wrong. This needs to start with getting the right people on board. "Hire people because they created a culture of candor elsewhere," the authors state, "not because they can out-compete their peers." 

7. Institute a process for sharing lessons. Use the company intranet, monthly meetings or whatever other appropriate means you can to encourage employees from all areas to share "lessons learned."  This will raise the collective intelligence of the company and make you more effective in preventing problems and improving processes. Give people one simple guideline: No finger pointing allowed—simply share what happened and what was learned.

Bruna Martinuzzi is the founder of Clarion Enterprises Ltd. and the author of two books, Presenting with Credibility: Practical Tools and Techniques for Effective Presentations and The Leader as a Mensch: Become the Kind of Person Others Want to Follow.

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Photo: iStockphoto

President and Founder, Clarion Enterprises Ltd.