Why Corporate Leaders Block The Candor They Say They Want

Speaking truth to power
How often do we hear our corporate leaders hold that up as a principle they cherish? It’s what keeps us honest and informed, those at the top say. It reflects our willingness to listen and learn, a testament to our belief that our employees are our most valuable assets, the driving force for company growth. It is the natural extension of an open-door policy, where employees offer their opinions and bosses listen.

Ah, if only it were so.

I have spent a career exposing organizational practices that block employees from being their best, and much of this has focused on what it takes for bosses and subordinates to hold the candid, straight-talking, all-cards-on-the-table exchanges that corporate leaders are always calling for but seldom get. Along these lines, let me ask you: If employees in your workplace don’t agree with their bosses, do they speak up? If they think their bosses are making major mistakes, do they say so?

In other words: do people in your office speak truth to power? (Or at least their version of the truth?)

Sadly, probably not.

Alternatively, when managers in your company hear employees disagree with them, do they ask: “What leads you to think that?” Or do they simply set that person straight?

Sadly, it is most likely the latter.

I believe that it’s time for all of this to change. It is time for top-tier corporate leaders to face the fact that they’re the ones responsible for the politics that keep truth telling out of the workplace – however much they insist they want it to be otherwise. It is time for leaders to realize that it is their job to change what needs to be changed, as psychologically wrenching as it may be for them. And it is time for leaders to see that without fundamental change, their companies are destined to be governed by fear and intimidation, to be places where truth is only sometimes spoken and then only in the shadows. In this article, I describe why that is the case and suggest how organizations and their leaders can make speaking the truth the way business is done around here.

The damage it does
The ramifications of ignoring this, of letting dishonesty (or, at best, silence) run rampant, are staring us all in the face. It seems apparent by now that there were scores of employees who saw General Motors heading to failure, who knew that Toyota was building defective cars, that recognized that BP’s cost-cutting pressures and regulation-skirting practices were a recipe for disaster. Clearly, plenty of bankers were scared to death that they were creating financial monsters that would turn around and eat their institutions, not to mention the global financial system. But too often they said nothing to those higher up who might have been in a position to do something about it.

Of course, such headline-grabbing examples are only the tip of the iceberg of silence and dishonesty. But they are vivid reminders of the outrageous non-communication, the missing give and take that haunts so many institutions day in and day out. It’s this everyday lack of candor and unexplored differences in viewpoints – on topics that never make it to the headlines – that truly does the most damage.

Silence is golden
Why is that? Why do so few employees tell their bosses what’s on their mind? Why do they so often obfuscate when talking to the one person with whom, more than any other, the company is counting on them to talk straight?

Let me offer the simplest answer: Managers make sure they don’t. A less simple answer: Management is hard, and most managers are woefully unprepared for the task.

Effective management requires nuance and subtle thinking, listening and empathy. It requires the ability to establish enduring, trusting relationships. It requires bosses to know how to build relationships with people who aren’t like them, and never will be. It requires bosses to stop filling in the blanks and, well, manage.

Many managers haven’t a clue how to do that. So instead, they typically mask their ignorance by using schemes that misapply the hierarchical structure that is necessary in any organization – somebody has to make the decisions after all – and impose it on the relationship between themselves and their subordinates.

Such an approach assumes the boss has all the answers, and it’s the boss’s job to make sure the employees understand those answers – or else. It’s about power and subordination, and it makes straight talk and candor all but impossible.

Hierarchy, remember, is designed to promote discipline and efficiency in communication. But hierarchical relationships squelch the open dialogue that is at the heart of honest and open communication.

The proof is in the review
Where’s the proof of this fear and dishonesty, you might ask. Well, the most visible evidence is sitting in front of us, much loathed and yet much ingrained in our institutions. It’s that annual ritual where bosses look for weaknesses and pretend to speak objectively for the company, and where subordinates grin and bear it and count the minutes until they can leave the room. It is the most vivid example that in companies, there is only one way of doing things: the manager’s way. And it is the job of the employee to mirror the manager, and never speak what is on his or her mind.

I am referring to the performance review.

If any managerial practice symbolizes and establishes the pattern for a lack of candor in organizations, to the management by intimidation that pervades our workplaces, it is the continued reliance on this pretentious, destructive, bankrupt practice. The performance review is the control mechanism that allows non-reflective, unthinking, flawed, anxious executives to maintain discipline and order, to claim to be available for candid discussion, and to blame all corporate shortfalls on operatives who didn’t follow the directions from management.

In fact, the pretense of evaluating performance ironically ensures that the company gets less performance than it otherwise could. It ensures that people aren’t going to talk openly about what’s going wrong. It makes it difficult – if not impossible – for the boss and subordinate to have a trusting relationship, even if the boss is a “good” boss. It makes self-protective defensiveness, rather than speaking one’s beliefs – that is, pleasing the boss, rather than getting the company what it needs – the behavior of choice for employees. And it destroys good performance by making it impossible for employees to tell management what they see management doing wrong – if only to give management an opportunity to correct what must be a false impression.

Not every manager, of course, uses the performance review to hide his or her own shortcomings and insecurities. And not every employee walks away from reviews demoralized and defeated. But the very existence of reviews within a company creates an environment of open-ended vulnerability that makes employees reluctant to hand a boss any weapon that could then be used against them. In such an environment, silent acquiescence is the communication path of least resistance.

What, you might ask, are corporate leaders doing about this? Well, nothing. Despite plenty of evidence that employees yearn for a more open environment, despite plenty of evidence that current practices make such openness impossible, the vast majority of top-tier executives seem oblivious to the need to address the internal politics that block employees from engaging in the open dialogue that management professes to want. They aren’t about to give up the club of intimation, the performance review, which allows them to get agreement on demand.

Given this, what are we to make of the fact that corporate leaders insist they welcome truth telling? To me, it’s disingenuous at best. By saying they want the truth – but doing nothing to change the politics that inhibits the truth – these leaders are essentially putting the onus on employees to buck the system, to put their careers at risk for the off chance that somebody will accept their critiques – or simply their opinions – with an open mind. No wonder it doesn’t happen often.

Management needs to stop this pretense of asking the victims – the employees – to fix what’s broke. It isn’t the employees’ responsibility. It is the responsibility of the managers themselves to change the system, to stop the circle of silence. Our door is always open, leaders say. But they won’t even acknowledge that in front of that door stands a dragon that no employee can get past. It’s management’s responsibility to get rid of that dragon. It isn’t the employee’s responsibility to slay it.

Questions to ask yourself
You don’t have to be a conspiracy theorist to wonder: What do executives gain by denying that their own actions block the very communication they say they want? Such an unwillingness to recognize “the dragon at the door” has led me to a point where I would cherish the opportunity to pose a series of questions to every corporate leader.

    * Doesn’t it tell you something that performance reviews are fraudulent and that pretty much everybody hates giving or receiving them? You say that nobody likes being evaluated? But isn’t it noteworthy that people who get praised typically dismiss these reviews as bogus just as much as people who are criticized? Isn’t it fascinating that pretty much the only people who defend these periodic nightmares are the employees whose livelihood depends on their existence – the people in human resources or consultants who insist that the problem isn’t the review but the way the reviews are administered?
    * Isn’t it revealing that proponents can’t point to any legitimate advantage of reviews, other than a vague argument that employees need to be “evaluated” or that a paper trail is necessary for firing people (leaving aside that most paper trails undermine a company’s case in court)?
    * Why do so many managers go along with control by intimidation protocols such as performance reviews and boss dominating relationships in the face of daily evidence that reviews only impact performance negatively by encouraging people to hide their mistakes?
    * Why would you, the people who are charged with leading the corporation as effectively as possible, refuse to even put this practice on the table for discussion or even see it as your responsibility to get rid of it? Your indifference pretty much guarantees that dishonesty and non-communication will reign.
    * Most importantly, what’s stopping top tier executives from doing their jobs and ridding the company of a protocol that so brutally and so clearly prevents people from speaking truth to power? What stops them from eliminating the company-created obstacle that keeps employees from suggesting ways in which both employees and bosses can be the best they can be?

And now, my answers
From my experience talking to hundreds of executives over the years, let me be a bit presumptuous and offer my own answers to those questions. Do these answers apply to every manager? Of course not. There are some good managers out there, working hard and doing the right thing. But a lot fewer than you’d expect. And a lot fewer than we need.

Part of the reason for the indifference, I believe, is intellectual laziness: It’s much easier to continue this charade of assigning a number to each employee, to pretend that bosses are objective geniuses who can identify, with uncanny accuracy, where the poor, hapless employees are screwing up, than it is to upend the system.

Part of it is that to do otherwise would be to admit that they, and the other bosses in the organization, have never truly learned how to lead. They don’t know how to motivate, to work with subordinates, to be a team. They don’t know how to make employees trust and admire them, to inspire employees to do what’s best for the company. They only know how to scare them into doing what the bosses want to do. Face it, it’s easier and less time-consuming and more ego-building to scare people than to work with them and actually engage their different perspectives and learn from them. Reviews allow managers to intimidate rather than manage, to impose their views on people whose experience tells them differently. They allow companies to pretend their executives are making “objective evaluations,” rather than simply giving high marks to employees who have best learned how to put pleasing the boss ahead of getting results for the company.

Part of the answer also lies in top management’s insecurity and anxieties. Don’t forget, the performance-review culture affects the boss as well. The need to find weaknesses in others makes the boss that much more defensive – and that much more unwilling and able to admit mistakes in himself or herself. How does that play out in real life? For one thing, Boss A does not want one of his cohorts coming after him because one of Boss A’s subordinates disagreed with Boss A in a public forum. But it’s also simply that bosses feel more secure when they don’t have to even worry about subordinates disagreeing with them. As a result, I believe that at some level of unconsciousness, bosses need employees to be vulnerable. Even though they make the decisions, they don’t want to be wrong. And they don’t want subordinates being able to call them out on that. Better to be wrong quietly, and not let the world know, than have to be shown the right way, and let everybody know they were wrong, even if the company is better off. The performance review is the safety valve that ensures that they can have their way with employees whenever they really need it.

But mostly, performance reviews allow companies to avoid the hard work of fixing the internal processes that inhibit employees from speaking the truths as they see it. Think of them as the avatars of corporate honesty, making management pretend that they are getting candor when in reality they’re just getting lies cloaked in a mask of straight talk.

This doesn’t mean companies should stop evaluating employees. It doesn’t mean employees aren’t held accountable, or that bosses don’t ultimately make the final decision. Of course they do. But in the end bosses ought to be accountable, too. They shouldn’t be able to make the decisions, and then simply blame the bad results on a “poor performer.” Their job is to ensure that all their employees are contributors. That means that whenever an employee deserves the consequences of failed results, the boss deserves consequences for insufficient guidance and support. Everybody’s skin is in the game – and everybody therefore needs to work together to make sure the company gets what it wants. No more simply pointing fingers below you.

But as long as the conversation in companies is a one-way monologue flowing from boss to employee, as long as the only “truth” that matters is the boss’s, as long as employees are afraid of speaking up for fear of getting bad grades or being labeled uncooperative or defensive or not a team player, then the straight, honest talk that will avoid the next disaster will never be achieved.

It all makes me wonder: When did management stop reflecting on how its stewardship might be seriously contributing to company faults? When was such reflection designated as a topic not to be further discussed, where no manager wants to even suggest that something is amiss, for fear that he or she will be assailed in a public forum – whether it’s a management meeting or board meeting or a shareholder lawsuit or a Congressional committee? When did loyalty to a company’s bottom line become loyalty to a company’s existing protocols – however flawed and fraudulent they may be?

The possibility of real change
Now, what can we do to change this? For years I’ve promoted a saner, more-effective alternative to the performance review – what I call the performance preview (www.performancepreview.com ). I describe the details elsewhere. But essentially, I envision a three-part solution.

Step one: Stop the intimidation, stop performance reviews and the boss-dominated relationship that go hand in hand with those reviews.

Step two: change the politics, creating reciprocal accountabilities, where both the boss and the subordinate have skin in the game, and are jointly held responsible for the company getting the results for which the new duo is on the hook. No longer will one person, the subordinate, stand accountable for the arbitrary and often fraudulent metrics that managers create. Give bosses the motive to do what the company is counting on them to do – ensure that each direct report brings in company needed results. Now both will be evaluated on whether the two of them, working together, got the results the company was counting on. After all, it’s the boss’s job to ensure that every direct report succeeds.

Step three: Start talking honestly with subordinates about your own biases and preferences, and own them as biases and preferences. Face up to how your own biases may be counterproductive when applied to somebody else who does things very differently than you do. Most important, understand that you don’t have all the answers. Nobody does. If everybody starts by owning what they think, instead of arguing over the “truth,” you can begin to have a trusting relationship that can tolerate each party hearing some things they don’t want to hear. And then you can have honest improvement – in people, in practices, in results.

In other words, how about finally giving employees the open access they are clamoring for, and the freedom from the fears and intimidation of performance reviews? How about giving them the knowledge that their results are going to be what counts when it comes to performance, and not whether they do things exactly the way their boss would do things? How about changing the premise from, here’s what you are doing, to, what do we need to know about one another to get rid of the hassling and history of intimidation so the two of us can collaborate to get the results the company needs?

No longer are we talking the pretense of what I, as boss, have the right to demand. We’re now discussing instrumentally what I need, with the tacit acknowledgement that other people might need something different and, in the synapse, practicing the lesson of learning about people’s distinctiveness and overlooking deficiencies that make no material difference.

If our corporate leaders don’t start changing their ways, if they don’t start recognizing the fear and intimidation that dominates their workplace, if they don’t start creating an environment in which straight talk is the behavior of choice, then the future is clear. When that next disaster – large or small – does happen, company executives will shake their heads, point the finger at employees and say that they are to blame. Heads will roll, and those “responsible” will be gone.

Many inside the company, of course, will know better. They will know that the blame was misplaced, and that the real threats to the company, the policies and structures that keep the truth silenced, haven’t been touched.

But they won’t say a word.

What’s Wrong With Performance Reviews? Start With This.
   1. They purport to be objective. but if that was true, why do studies show that when employees change bosses, their evaluations also change dramatically?
   2. The metrics used are arbitrary and too often the same for everybody – regardless of the job or the style and approach of the person being evaluated.
   3. Reviews are often marked on a curve. But that forces bosses to find weaknesses that don’t exist, because they can’t give everybody good grades, even if they wanted to. And the curve means that employees are pitted against one another, undermining the notion of teamwork.
   4. Only one thing counts: the boss’s subjective opinion. That means the review depends largely on the personal chemistry between the boss and subordinate.
   5. Reviews are justified on two bogus grounds: pay and liability. But pay is determined by market forces, not performance. And companies don’t need performance reviews to fire employees.
   6. They’re bad management, relying on finding weaknesses rather than playing to strengths.
   7. They allow managers to get away with bad behavior, because they can hide behind their “objective” performance reviews rather than face their own shortcomings.
   8. They keep employees from growing as employees, since they are afraid to reveal their own deficiencies.
   9. They force employees to tell managers what they want to hear, rather than what they really think will improve company results.
  10. They mean that problems are discussed after they happen – rather than before they appear.

Reprint from Ivey Business Journal
[© Reprinted and used by permission of the Ivey Business School]