Leadership Transparency

How do you and/or your company ensure employees are informed and can trust leadership? I'm part of the leadership team at my company and we need to improve our internal communication and work intentionally to build trust after unfortunate layoffs in 2020. We're a series A startup with <40 employees so we have the opportunity to be more transparent than a larger organization with more layers.

For instance:

Do you share burn rate and remaining capital at your all-hands meetings? (risk with confidential info leaking?)
Customer stories (good and bad) shared at all hands?
Effectively disseminating information from leadership meetings to your team meetings
How do you deal with communication around cuts or people leaving? (We have had to make more than one cut over the past year and I believe this is a source of stress for people. Uncertainty around why cuts were made or their own job security. We did write internal communication about cuts and discuss at the all-hands but I don't think it was enough).
Any rules of engagement for Slack?
Anything CEO-led that you think is effective?
Being genuine, listening, and demonstrating empathy

I want our company to innovate around transparent leadership and this is a great group to ask!

Thank you

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Kelly Hook
Head of Customer Success | Orderful
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Comments

Ido Barnoam

Hi Kelly

Contrary to the other thoughtful responders, I'm not part of the executive team in my company, so I have the advantage of giving a slightly different view on matters.

We are a medium-sized SAAS company (±260 employees) who started its way as a bootstrapped startup. Ever since day one in the company, transparency was one of the main values. I'm happy to share what are some of the practices we use to maintain this culture, and also some adjustments that were made do to COVID. I'll also (hopefully) address the points you raised

Some practices we use to keep and maintain transparency:

* Every day an email is sent with the company's business metrics. These are generated and sent automatically. The metrics include MRR, ARR, and Churn rates. Also other business metrics like the number of new registrants, the number of paying customers added and lost, revenue and operational costs per day and 30 days backward, and a host of other statistics. The remaining capital is not shared specifically shared but it's possible to understand the general standpoint of the company. Everyone can see these on a daily basis so it negates the need to raise or talk about this in meetings

* Our town hall meetings happen once every two weeks. During COVID these meetings happen every week to increase the involvement. People from different departments share interesting things they are working on. This includes customer stories, both negative and positive. For example, recently the head of the CSM and AE teams shared stories of how our company helped customers who requested relief due to COVID. This included the actual numbers of any relief that was given and the number of customers that requested that.

* All hands meetings happen once a month in the same format as town hall meetings. Once a quarter the CEO shares the business outcomes per the expectation for that quarter.

* We use Slido in meetings to allow people to ask questions and vote for them. At the end of each meeting, all the questions with 10 or more votes get addressed by the relevant person. This includes hard questions as well around people leaving, bonuses, business outcomes, etc. This is something that really generates transparency as the leadership makes sure that all the questions get answered, if not in the actual meeting than on slack.

* We haven't had the need to handle people leaving involuntarily due to COVID, but when this happens a very respective email is being sent together with any feedback from the leaving person (if he wants to)

Hope the above helped to answer some of your questions.

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Ido Barnoam
Enablement Lead, Customer success
Cloudinary
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-------------------------------------------
Original Message:
Sent: 08-13-2020 15:45
From: Kelly Hook
Subject: Leadership Transparency

How do you and/or your company ensure employees are informed and can trust leadership? I'm part of the leadership team at my company and we need to improve our internal communication and work intentionally to build trust after unfortunate layoffs in 2020. We're a series A startup with <40 employees so we have the opportunity to be more transparent than a larger organization with more layers.

For instance:

Do you share burn rate and remaining capital at your all-hands meetings? (risk with confidential info leaking?)
Customer stories (good and bad) shared at all hands?
Effectively disseminating information from leadership meetings to your team meetings
How do you deal with communication around cuts or people leaving? (We have had to make more than one cut over the past year and I believe this is a source of stress for people. Uncertainty around why cuts were made or their own job security. We did write internal communication about cuts and discuss at the all-hands but I don't think it was enough).
Any rules of engagement for Slack?
Anything CEO-led that you think is effective?
Being genuine, listening, and demonstrating empathy

Jim Ashley

Hey Kelly,
Sorry to hear about the layoffs in 2020. As someone that was impacted by COVID because my former company supported SMB restaurants and have been a part of some failed startups, I know how hard that can be.

With that stated, I am thrillled to hear thinking of how to build trust after a downturn. Culture is such a pivotal component and sometimes gets lost in the rest. My new company is similar to yours with ~60 employees and bootstrapped and I am on the exec/leadership team, as well.

As for your questions, I agree with Mike. I would not share the burn info. We have been folloiwng much of what Mike discussed. My new company went from sharing no information to a bit too much without time or ability to explain the context. We have settled on what are the company objectives and what are we doing in each department to help achieve those goals. We have instituted a weekly Town Hall to be more available and explain the "Why's" in addition to our company all hands that are held monthly.

Customer stories help reinforce behaviors that led to success or spawned failure. So much can be learned by discussing these and being transparent with the team. As nimble as we all need to be right now, giving light to what happened prior to an account being signed through expansion or churn, can ensure what you want to happen can be repeated more frequently.

Being transparent about people leaving and why the decisions were made is hard to do, but I believe when handled well can actually strengthen a team. Having been a "survivor", part of the RIF, and a "lame duck" (kept around to help wind down the business) throughout my career, the way the team handles this conversation speaks volumes of who they want to be in the future.

I wish you and your company the best in this time. The sheer fact you are asking these questions point to the fact you and your team are on the right track.

Stay well.

Kelly Hook

Mike,

Thank you so much for this thoughtful response – you've given me a lot to think about and act on right away.

Best,
Kelly

Mike Gospe

Hi Kelly,

I am not versed in the latest HR practices, but I can share what has always been my approach for open communications as a senior executive (director & VP). Trust is critically important and often illusive, especially during these last few months. At no time in our human history has the world been in such a dynamic state of mistrust, confusion, and fear. To combat this, I do believe that trust and authenticity must start at the top -- the CEO. However, there are appropriate limits. Let me touch on the items you raise:

* Do you share burn rate. No. Sharing too much information on the minutia of operations only adds to angst and invites everyone to second guess the leadership team. This, then, drives the opposite of what you want. The CEO should focus on the vision/mission of the company and provide enough information to earn trust and faith of employees. Share what he/she is learning from the market, what the pipeline looks like, and how the company is investing to add value to your customer base. But, don't fall into the trap of explaining accounting details to staff. (Side note: I've been coaching companies to think about this question: In 2020, what if your current customers are your only customers? What does that mean for your company, your sales model, and where you invest your (limited) time and money. The answer is not with renewed aggressive sales tactics. I think the answer is to you deputize all employees to be part of cross-functional customer support/experience teams. Gaining greater empathy with customers will give you new insights and create stickiness for future growth. In the long run, whoever understands the customer best wins.)

* Customer stories can indeed be a cause for inspiration. There is always something to be learned. Often, learnings from a bad customer experience can lead to an "a ha!" moment that drive future success. During COVID lock-downs, every company is having to pivot. Be open to possibilities. Invite employees to be part of the conversation.

* When disseminating information from leadership meetings start but don't stop with an all-hands. I always found it productive and informative for the CEO to share an overview at an all hands, but then ask all VPs to host a follow-up discussion in smaller team meetings where you can discuss what this means for your specific department. The outcome of those discussions can be summarized and then shared at the executive level. This encourages productive conversations up and down the organization.

* Communications around people leaving? This is very hard, and I refer you to your legal and HR departments. For you and other "survivors", it is important for everyone to continue to act professional and take the high road. If/when you disagree, take that feedback to management. If you want to vent (and it is important to have an opportunity to do so because it is human nature), then set up a safe environment to do so. It's tempting to jump to social media, but don't do that. That just makes it harder to move forward.

* Slack: Same goes for Slack. In these cases assume that "Slack is not your friend." Be careful about what you post.

* The next 6 months are going to continue to be tough for everyone -- even those who keep their jobs. Working from home, lockdowns, are adding stress. An idea is to have your CEO give quarterly updates to all hands, plus continue to encourage department follow-up conversations (like I suggested earlier). Another idea is to invite a cross-functional group of people to come up with ideas to bolster (or alter) company culture to encourage an "open door policy" and engender trust. If you are starting out with obvious trust issues, they will not be solved overnight. it's a process. You must be patient. But making the effort, and being consistent in what the leadership staff says and does is very important. The leadership team must be open to have the talk and walk the walk.

I certainly don't have many of the answers you are looking for. But, from my experience as an executive, these ideas have always helped me.

Best,

Mike