Part 5: Transparency Case Study: Kyocera in 2001 During the Telecom Crash

John Schierer Transparency 5 Part Series Leave a Comment

Editor’s Note: This is part 5 of a 5 part series where John Schierer explores the topic of transparency in the workplace. To get the full context of John’s perspective on transparency in the workplace, we encourage you to start from the beginning of the series.

Part 1: What is Transparency and Why Do People Want It?
Part 2: Why Managers Hate Transparency
Part 3: What HR Can Do to Promote Transparency
Part 4: The 4 Great Myths about Transparency… and the Reality
Part 5: Transparency Case Study: Kyocera in 2001 During the Telecom Crash

By John Schierer

Talking about the value of transparency is one thing, but living it is difficult.

In 2001 at Kyocera we sat smack dab in the middle of the Great Telecom Crash. Customers were cancelling orders every day and a major customer had even taken the stance that they were not going to honor their Purchase Orders and dared the suppliers like us to sue them.

We had over 600 production employees over three shifts and we struggled with what to do. One early decision was absolute transparency in how we approached the situation. That commitment played out in many unexpected ways. Some of the highlights:

  • Twice a week we held all employee meetings in the parking lot on each shift. There, we explained the latest information on customer cancellations and efforts to recover. Early on when we could not determine the rate of deterioration, we had no details but explained that, as soon as we knew a layoff might be necessary, we would announce it in as much detail as we could.
  • Knowing that there were some people who might be leaving for various reasons but were afraid to reveal it in anticipation of a layoff, we asked for volunteers and stated that they would get all the separation benefits of anyone in the layoff.
  • To combat the rumor mill and hopefully co-opt it, we placed a rumor box in the building and promised that it would be opened each day and all questions answered within 24 hours.
  • When we could calculate the layoff, we announced the total number of people that would be laid off, the date and the process of selection.
  • Three days before the layoff, an announcement detailed how each employee would be treated- severance, health benefits, unemployment benefits. All employees were told the day of the layoff and that the process would last about 5 hours, beginning at 7AM. This was one of our toughest debates. In the end, the openness defeated the rumor mill. Employees knew how they and their co-workers would be treated.
  • Managers were trained to announce when the action was complete in their area. New assignments were discussed in the smaller department along with the rationale of how those assignments were made. Key customer pain points are discussed to maximize the orders that remain.

It was not easy discussing an impending layoff in such great detail. Often there were audible gasps as the early discussions took place. But in the end, fear was reduced because speculation was filled with hard facts. Employees remained engaged and survivor guilt was reduced with the knowledge of how others were treated. Managers were more engaged in the planning because they knew their decisions would be examined and had to pass the test that only transparency can demand.

John Schierer

John Schierer

John Schierer is a senior Human Resources Consultant with over 25 years’ experience with such companies as Thomas and Betts, Kyocera America, Cobham Sensor Systems, and Cubic. His HR teams create strong cultures of employee engagement resulting in record-setting financial performance.His teams were awarded the Workplace Excellence Award by the San Diego Society of Human Resources (SDSHRM) in 2008 and 2010 and the National Business Research Award in 2009 for wholesale gains in employee engagement results.
John Schierer

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