Running Head: TRANSPARENCY IN ORGANIZATIONS 1

Appropriate use of transparency in organizations

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Introduction
In the global marketplace of today, many leaders, executives, and managers are

concerned with building trust with their employees and clients (Buble, Juras, & Matić, 2014).

However, many fail in this endeavor because of failure to realize that there is a direct correlation

between having an internal culture of trust and transparency and better performance. In fact,
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many leaders are faced with the challenge of maintaining the right degree of transparency within

their organization with many going towards two extremes. Some leaders operate their

organizations with an open-book management style while others believe in carefully maintaining

the security of information. The primary aim of this paper is to discuss the appropriate use of

transparency in organizations. I will express my opinions on what the most appropriate level of

transparency for an organization is, identify instances in which transparency would not be a good

strategy, and explain how a leader might exert influence-using transparency.

The Most Appropriate Level of Transparency for an Organization
Various researchers and scholars such as Schnackenberg and Tomlinson (2016), have

unanimously agreed to the notion that transparency in organizations is linked to increased

innovation and heightened performance. They have detailed how organizations that have a

transparent culture are overwhelmingly more successful and share a common purpose and goals

across all employee levels. They have shown that lack of transparency, which is about

organizations operating in secrecy, can arouse suspicion and distrust, and thus declined

productivity. They posit that there is a need for a balance between the two extremes of workplace

transparency. My opinion on what the appropriate level of transparency is concurs with

Schnackenberg and Tomlinson (2016) who posit that the appropriate level of transparency is one

that promotes positive perceptions. In this line of thinking, then, the appropriate level of

transparency is one that leaders can capitalize on to foster the perceptions of fairness and

honesty.
Instances when transparency would not be a good strategy
While transparency is associated with an array of benefits, there are numerous instances

where transparency would not be a good idea, meaning that information would have to be

secured as much as possible. Ideally, it would be prudent to avoid transparency as a strategy in

instances where disclosure of information would lead to more harm to the organization, its
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operations, and the people it supports (Schnackenberg & Tomlinson, 2016). For example, let us

consider an organization that is mandated with maintaining confidential information on the

health of the nation’s veterans. In such a situation, transparency would not be an ideal strategy as

such information would be open to consistent assessment when made available to employees. In

another instance, a publically traded company full disclosure of how and where some

appropriated funds are used may lead to inadvertent risk exposures that may jeopardize normal

operations.

In some organizations, team member share and managers meet regularly, inform them

about what is going on and why, and then respond to their various queries. But managers who

think that true employee involvement can be achieved through such efforts are unlikely to

achieve anything other than a “quick and short-lived fix “for their organization woes

(Schnackenberg & Tomlinson, 2016). The situations where transparency would not be a good

strategy are while implementing changes in the organizations or of downsizing of the employee.

When the employees are aware of the changes to be taken place, there will be resistance from

them and this will lead the managers to change their decision. Same is the case for downsizing in

the company. When the company is facing loss and in desperate need of cutting cost, they often

think of downsizing. This decision will again face resistance as no one want to lose their jobs.

How a leader might exert influence using transparency

According to Brunner and Ostermaier (2017), transparency influences a leader’s

behaviors, and thus an impact on how s/he can influence his or her followers and subordinates.

With the right amount of transparency, a leader can better succeed in gaining trust and

commitment from all employee levels in his or her organization (Buble, Juras, & Matić, 2014).

Subsequently, this affects motivation, innovation, and overall productivity. Therefore, leaders can
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use transparency to influence positive attitudes in employees towards their work and the goals

and objective of the organizations to which they are affiliated.

Conclusion

On average, organizations lose forty percent of the potential financial value of their

strategies due to poor performance and talent management of their employees. Thus, it is

necessary to have alignment of individual goals with that of the organizations. Unless employees

are motivated, the alignment of organizational and individual goals will not optimize the

organization’s overall performance. And, to a quite a level transparency increases the

motivational level. An individual’s performance becomes more evident with greater level of

transparency. Transparent goals are critical for an employee to understand how his or her own

goals and performance relate to those of other employees. There is no globalized model for

transparency and it depends on the leaders. It depends how the leader fosters transparency in the

work culture and to what level.

References
Brunner, M., & Ostermaier, A. (2017). Peer influence on managerial honesty: the role of

transparency and expectations. Journal of Business Ethics, 1-19.

Buble, M., Juras, A., & Matić, I. (2014). The relationship between managers’ leadership styles

and motivation. Management: Journal of Contemporary Management Issues, 19(1), 161–

193.
Schnackenberg, A. K., & Tomlinson, E. C. (2016). Organizational transparency: A new

perspective on managing trust in organization-stakeholder relationships. Journal of

Management, 42(7), 1784-1810.

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