How to build honesty and candour in your business

Telling it straight.  Being open and honest and giving constructive guidance and feedback.  They all sound simple but are, in fact, really hard. Being direct and confronting difficult issues pushes many people right out of their comfort zone. Add to this our good old British reserve, and you often find that companies in the UK are hotbeds for negative gossip, backstabbing and mistrust.

If you want to grow your business and reap the benefits of scaling up, you must sort this out immediately.  Make it your number one priority. Everything filters down from the top, so lead by example.

Start with salaries

Salary transparency.  Really? I can sense your heart filling with dread.  And yet, if you want to get to the root of any negativity in your organisation, this is a good place to start.  Secrecy in companies can be corrosive, particularly around this issue. So, take the opposite view. Only keep things secret when you absolutely have to.

Ask yourself why you might feel threatened by salary transparency.  Is it because you know there’s an inherent unfairness in your business?  Then fix this straight away. Running a business on lies is not a good premise for success.  Isn’t it only right that two people doing the same job should be paid the same salary? What is your gender pay gap?

One of the things I suggest to my clients is to introduce job families.  It’s a good first step towards salary transparency and something we introduced when I was MD at IT Lab. Grouping roles and then giving them a salary banding will enable staff to know what skills, experience and values-led behaviours they need to demonstrate before they get a pay rise.  Introducing different levels within these job families gives employees something to aim for. It also provides an easily justifiable reason why some people are getting paid more than others. And your managers need to commit to coaching to facilitate progression within their teams.

Makers Academy go a step further and allow staff to set their own salaries.  They believe this is fundamental to building trust between colleagues. The only time the company decides salary levels is when staff are first recruited.  The moment someone’s hired, their offer letter appears on the company intranet. Everyone knows what they’re being paid. And if someone feels they’re worthy of a pay rise, there’s a process to follow.

First, they write an essay giving their reasons why – the value they feel they bring to the company, the market-testing they’ve done externally etc.  Four colleagues are then chosen to peer review this essay. Once it’s agreed, the request goes straight to Finance who sanction the pay rise. This approach encourages self-awareness, takes away the traditionally adversarial nature of pay reviews and facilitates the giving and receiving of feedback between all staff. Read more: How to set your own salary

Get your leadership team to live and breathe it

If you want to properly embed honesty and candour throughout your company, it has to come from the top.  Your Senior Leadership Team needs to decide it will not accept any triangulation. Ideally, do this six months ahead of the rest of the company. Agree that you won’t have any negative conversations about anyone else unless they’re in the room. Commit to open, honest communication and peer coaching. Work on confrontation, battle against the stiff upper lip of Britishness and make transparent, open communication the norm. Monitor each other and don’t introduce it anywhere else until you’ve all agreed you’re doing it correctly.  You’ll be amazed how it starts to filter out naturally to the rest of the organisation if you’re modelling it well. It will become the way you operate, every day.

And if someone in your SLT can’t commit to this?  Then they have no place in your company. You’re trying to drive behavioural change to create a high performing team.  You need total buy-in.

Make it a requirement for management

To my mind, the ability to have frank, open and honest conversations should be a prerequisite for management. People shouldn’t be promoted unless they can handle confrontations and personal disagreements in a constructive, honest way.  By prioritising this behaviour, you’re showing you care deeply about your staff being the best version of themselves they can be. You’re truly committed to coaching and mentoring them.

There aren’t many athletics coaches who’ll say, ‘That was quite good Dom, well done!’  Instead, it’s likely to be, ‘Next time, get your knees up’ or ‘Do another rep’. There’s a sense of forward momentum and aspiration to do better which is equally important in business.  A good manager wants his or her team to aim high and feel a sense of continual improvement. But they need to know how to improve.

This is why I loathe annual appraisals.  If you don’t have them in your company, don’t even think about introducing them.  If you do, get rid of them! OKRs are so much better. Have your employees set their own goals in agreement with their managers who coach them towards achieving them.  Every goal should be a stretch but make sure that staff know what they need to do to get there. OKRs should be broken down into weekly meetings where progress is reviewed against monthly and quarterly objectives.

One of the coaching exercises I do around setting OKRs is getting people from different teams to mark each other’s homework. When setting goals, I often see a tendency to under-cook. This isn’t deliberate and teams need to learn how to do this equitably across the whole organisation. It’s much easier to look at someone else’s OKRs in a different team and be honest about the fact they’re not right.  This can often be the first time someone has made a negative comment to the senior leadership team but it’s vital to ensure OKRs are written in a consistently challenging way.

Actively seek criticism

As a boss, I want all my employees to feel they can speak truth to power.  In the same way as I want to be honest with them, I want them to be honest with me.  Without constructive criticism, how will a company ever improve and grow? At the various companies where I’ve been MD, I’ve encouraged staff to tell me when there are stupid rules or habits that have crept in under the radar.  It’s important not to take any of this personally but use it to make things better. Build a culture where you value people’s opinions and act on their concerns.

This goes for customers too. In the past, I’ve introduced Net Promoter Score® not because we wanted to pat ourselves on the back for being brilliant.  We were actively seeking criticism from our detractors. This told us where we needed to improve and helped us focus on the things that mattered.

Show that you care

When I’m coaching clients, I like to ask them some revealing questions.  If a colleague has spinach in their teeth, would they tell them? Maybe a third of hands go up in the room.  I then ask them, how about if another colleague has come into work with really bad BO? Or bad breath? Would they still tell them?  By now, most of the hands in the room are down. We naturally find these sorts of conversations uncomfortable.

And yet, I ask them, if you yourself had spinach in your teeth or BO that you weren’t aware of, wouldn’t you prefer that someone told you?  Rather than walking around all day with people talking about you behind your back? If you really care about the person, you should be honest and tell them.  If you can’t do this for them, then how are you going to tell them they’re not great at their job?

This is the essence of ‘Radical Candour’, a phrase coined by Kim Scott in her best-selling book.  Her pivotal moment came when she was given brutally honest feedback by Sheryl Sandberg when she was working at Google.  After a presentation that had gone well, Sandberg took her aside. She congratulated her but then told her she’d said ‘um’ a lot.  To drive the point home, she said this made her sound less smart, even though she very obviously wasn’t, and suggested she see a speech therapist to fix it.  When Kim reflected on this encounter, she defined her theory of radical candour – a skill that requires bosses simultaneously to care personally whilst challenging their employees directly.

I love the way e-commerce company Next Jump give feedback to their staff in meetings. They have a specially designed, real time app to handle this.  Any things that impact on a member of staff’s ability to do their job are flagged up. They call it your ‘backhand’. Opportunities are then created for staff to work on their backhand outside their regular day job.  For example, any employee who struggles with speaking in public is asked to lead culture tours around the company. By doing this, they deliberately practice their public speaking skills in a way that isn’t revenue impacting.  Fantastic idea!

Bring honesty and transparency into hiring

When I recruit staff, I always look for people with curiosity and coachability at interview.  As a test, I give radically candid feedback to applicants. They need to be able to take it – this tells you a lot about someone. I’ll chat away with them and then ask them why they haven’t done up their top button.  Or brought a pad and pen. Or had a shave! Occasionally, someone gives a good answer. One guy told me his hairdresser thought he looked sexier with a day’s growth. He had a date later on so hadn’t shaved for the interview. He wasn’t offended by my frankness and was prepared to be vulnerable.  Needless to say, I hired him.

Give open, honest feedback to any unsuccessful candidates. Tell them why you didn’t hire them.  It shows that you care about them finding a job elsewhere. If you’ve made it easier for them next time, you’ve created a benefit through the hiring process. Many managers won’t do this as it makes them uncomfortable. But your feedback is much more likely to be appreciated than not.

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Creating a culture with honesty and openness at its core is difficult.  But if you can make radical candour the default way in which your organisation behaves, you’ll have done something that’s really transformational.  It will pay dividends every, single day – like compound interest for your organisation. You’ll move faster and grow quicker with way less organisational drag and bureaucracy holding you back.  For the vast majority of staff, being radically candid is going to be uncomfortable but stick with it. Tell them why it’s important and train the behaviour into the organisation.

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Written by business growth coach Dominic Monkhouse. Find out more about his work here. Read his new book, ‘Mind Your F**king Business’ here.