Part 2: Why Managers Hate Transparency

John Schierer Human Resources, Transparency 5 Part Series Leave a Comment

Editor’s Note: This is part 2 of a 5 part series where John Schierer explores the topic of transparency in the workplace. In this part, John explains why managers hate transparency. To gain some context as to his perspective on transparency and why he believes people want it, please refer to Part 1.

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

Transparency is not easy. It pushes organizations into uncomfortable territory. When employees have access to the same information as the manager, it exposes many more decisions to the light of day. For some managers, it is an opportunity to coach, enlighten, involve and constantly improve both themselves and their departments.  For others, it is an intrusion by others and an encroachment on their territory as a leader.

Transparency has a domino effect into many areas beyond the most obvious implications.

Take for example transparency in compensation systems and philosophies.  In two organizations I supported the installation of new and transparent compensation systems.   HR proposed each employee know their pay grade, their position in that grade relative to the midpoint and maximum, and the pay range of all jobs in their job family. In addition, HR would explain the methodology and the data used to set the grade of the job.

After years of literally slipping pay information across the table to employees on a piece of paper face down- managers howled in protest. This openness would bring about anarchy, mass resignations and productivity would grind to a halt in a welter of compensation arguments.  The managers even complained that their own privacy was being violated as employees could figure out how much they made as managers.

Quite to the contrary, the opening of the compensation system had wide-ranging positive effects

  • Employees felt good about the organization that took their pay scheme so seriously and paid for the best data.  Prior secrecy around the system led to a feeling that the pay system was arbitrary. Explaining it gave confidence to employees that the company was paying competitive wages and had nothing to hide.
  • Performance discussions became more meaningful now that pay relative to midpoint was better understood.  Managers had to be better informed and the quality of both the appraisals and the merit increases improved dramatically.
  • Employees became more invested in understanding their career ladder and the skills and behaviors  the organization valued, thereby aligning  their efforts with what was important to the business.
  • As the Internet provides access to unreliable and unverified “expert” pay sites, a transparent system allowed the organization to explain why the pay philosophy made sense to our business and industry- providing context to a widely misunderstood discipline.
  • The positive feeling had a spillover effect into other areas. If the organization trusted employees with this sensitive topic, other communications took on the ring of truth rarer than a suspicious cynicism.
Next: Part 3 – What HR Can Do to Promote Transparency  >>>
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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