The culture of candour, the idea of being as transparent as possible, is a unique phenomenon which encourages transparency in the corporate space to improve problem-solving skills and effective communication within the enterprise. Unfortunately, it is often ignored. There are many advantages to being transparent, not only when it covers to your successes, but also your failures. While many companies have managed to adopt a transparent culture and integrate it into their corporate environment, others still hold back.
Discussing problems publicly, especially when employees are discouraged from doing so by their supervisors is difficult, but necessary. An example of this was described by Bryce Hoffman in his book American Icon: Alan Mulally and the Fight to Save Ford Motor Company. Hoffman wrote about the previous Ford CEO and the way he dealt with dissenting voices: 'This is our new marketing strategy...If you don't agree with it, I've got somebody from HR who will work out your retirement.' Indeed, in some enterprises, the culture of candour is not implemented, therefore, the issues are not shared or selectively interpreted. The leaders are not always to blame. They can demand candour, but it doesn't mean they always get it.
If leaders don't get the full picture of problems, those problems may never be solved. Apart from this becoming an obstacle, it can also disrupt the company's innovation processes. If the innovation teams don’t communicate with the leadership team, developing new products and services is likely to end in failure.
So if candour is so important but leaders don't always get it, how can we achieve it? In this instance, It is worth looking at three different examples.
At the start of the 21st century, the Ford Motor Company was experiencing serious financial difficulties. Bill Ford, the great-grandson of Henry Ford, decided to invite Alan Mulally from Boeing to turn the company around. Ford had some issues with corporate candour, which was one of the reasons why the company was in trouble. By changing those deeply ingrained behaviors in the team, Mulally instituted a structure and process which helped to transform both the management and the culture of the company.
The first change was the Business Review Plan (BRP) process, where senior managers gathered at least once a week to discuss the company's performance. At first, managers were not willing to talk about the issues and were confidently saying that the company was performing just fine. However, Alan Mulally then pointed out that the company was likely to lose $17 billion if no one talked about the real issues. Another change that helped is the integration of the ’24 hour' rule, which meant that the managers had exactly one day to solve a problem before they would go public about it.
Another example of a company that praises transparency is Pixar, the world leader in animated movies. The company is successfully using an approach called 'BrainTrust', where employees can provide brutal criticism related to production processes. According to Pixar's CEO, Ed Catmull: 'All films suck in the beginning, and 'BrainTrust' is something that is able to change it.' In film production, one successful project doesn't guarantee that the next one will be as good. Effectively finding the problems and leveraging collective intelligence to solve them is what makes Pixar the leader in animated films today.
All companies are different. They apply different business models and strategies, and the range of problems they face is very different. However, we can clearly see that that the culture of candour boosts companies' confidence when it comes to decision-making and problem-solving.
Sometimes, transparency is difficult to achieve due to the nature of specific industries. Alcoa, one of the world's largest aluminum producers spent years dealing with a negative company image. Only 30 years ago, the employees had to work with ore, chemicals, and electricity, which was not a safe environment. Yet, today Alcoa has an impeccable safety record. The company dealt with several fatalities in the workplace, but when CEO Paul O'Neill joined in the late 1980s, he introduced a '24 hour' rule, where employees had to report incidents within 24 hours. It also required that counter measures had to be rapidly developed and efficient solutions had to be shared within the team. That approach had a significant impact on the company's performance too as factories became more pleasant places to work and productivity increased.
At some point,all companies face poor transparency and its negative consequences. We can see from the examples, that setting a short period of time for problem-solving and reporting to the team is the key to a strong communication system. Everyone makes mistakes but further damage can be avoided if problems are discussed at an early stage rather than becoming a burden.