Are you an honest person? I’ll bet that you answered “yes.” If you did, who else do you know that’s completely honest? I’ll bet that was much harder to answer. How is it possible that everybody believes that they are honest yet has a difficult time identifying anyone else with the same characteristics? Are we all so dishonest that we are lying to ourselves?
The truth about telling the truth is that it does not come easy for anyone. It’s not natural or organic. The natural thing to do is tell people what they want to hear. That’s what makes everybody feel good . . . at least for the moment. Telling the truth, on the other hand, is hard work and requires skill.
If you lead an organization, being dishonest can be fatal, because the quality of the organization’s execution is a function of the quality of its communication and the key to communication is trust. As I wrote in CEOs Should Tell It Like It Is:
Without trust, communication breaks. More specifically:
In any human interaction, the required amount of communication is inversely proportional to the level of trust
Consider the following. If I trust you completely, then I require no explanation or communication of your actions whatsoever, because I know that whatever you are doing is in my best interests. On the other hand, if I don’t trust you at all, then no amount of talking, explaining or reasoning will have any effect on me, because I do not trust that you are telling me the truth.
In a company context, this is a critical point. As a company grows, communication becomes its biggest challenge. If the employees fundamentally trust the CEO, then communication will be vastly more efficient than if they don’t. Telling things as they are is a critical part of building this trust. A CEO’s ability to build this trust over time is often the difference between companies that execute well and companies that are chaotic.
As a result, any dishonesty from the leader will be devastating. Employees trust CEOs with their livelihood, most of their waking hours, and their careers. If employees are repaid with lies, how will they trust the CEO’s directions? As a result, how well will the company execute?
CEOs should be honest. That seems obvious enough, but it turns out “be honest” is easy to say, but amazingly hard to do. Let’s look at some scenarios to understand why.
- Sales are not going well. If you tell the company the truth, employees might rightly worry about the viability of the company and leave to go to another company. If they leave, you will surely continue to miss your numbers and introduce a spiral of under performance and attrition.
- The expense structure is too large for the business and you will likely have to do a layoff. The company isn’t doomed, but if you do a layoff, the press will write that you are doomed and employees will read it. If they read it, they will worry and leave and then you really will be doomed.
- An important executive just quit. If you tell the truth, people will wonder why and if they might have better options too.
- The product has a serious flaw that is causing customers to fail and causing you to lose deals. If your employees learn this, they may wonder why they are working for the number 2 company and not the company that’s beating you.
- The valuation on the last round was too high and you are looking at a down round. Your managers sold new hires on the promise of the old, higher stock price going even higher.
It seems like telling the truth is like committing corporate suicide. How do you ever tell the truth given what’s at stake? This is indeed the key: You must tell the truth without destroying the company.
To do this, you must accept that you cannot change the truth. You cannot change it, but you can assign meaning to it. How do you do that?
Imagine the bad fact that you had to assign meaning to is a layoff. The first thing to realize is that you will not be the only one interpreting what the layoff means. Reporters will say it means that the company has failed. Laid off employees will feel betrayed and convey that. The employees who remain will have many interpretations.
There are at least 3 keys to assigning meaning:
- State the facts clearly and honestly — Don’t try to say that you needed to clean up performance issues or that the company is better off without the people that you so painstakingly hired. It is what it is and it’s important that everyone knows you know that.
- If you caused it, explain how such a bad thing could occur – What was the decision process that you used to expand the company faster than you should have? What did you learn that will prevent it from happening again?
- Explain why taking the action is essential to the larger mission and how important that mission is — A layoff, if done properly, is a new lease on life for the company and an action that was necessary to fulfill the prime directive and mission that everyone signed up for. As the leader, it’s your job to make sure that the company does not let those people lose their jobs for nothing. Something good needs to come out of it.
As an example, let’s look back in history to Abraham Lincoln to see how he gave meaning to the Civil War and explained to the country why people did not lose their lives at Gettysburg for nothing.
Gettysburg was the bloodiest battle of the bloodiest conflict in the history of the United States. It pitted countryman against countryman, brother against brother, and ended in massive death. That was the truth. When Abraham Lincoln gave his famous address at Gettysburg, he did not deny the truth, but he did assign meaning. What did Gettysburg mean? What did the Civil War mean?
It’s important to note at the time, that the Civil War meant something entirely different than it means now. For someone who lived in 1860, the Civil War was likely about preserving the Union or the economics of slavery or states rights. Lincoln assigned a new meaning, which is with us to this day. The speech is so short and so powerful that it’s worth reading in its entirety.
Four score and seven years ago our fathers brought forth on this continent, a new nation, conceived in Liberty, and dedicated to the proposition that all men are created equal.
Now we are engaged in a great civil war, testing whether that nation, or any nation so conceived and so dedicated, can long endure. We are met on a great battle-field of that war. We have come to dedicate a portion of that field, as a final resting place for those who here gave their lives that that nation might live. It is altogether fitting and proper that we should do this.
But, in a larger sense, we can not dedicate — we can not consecrate – we can not hallow — this ground. The brave men, living and dead, who struggled here, have consecrated it, far above our poor power to add or detract. The world will little note, nor long remember what we say here, but it can never forget what they did here. It is for us the living, rather, to be dedicated here to the unfinished work which they who fought here have thus far so nobly advanced. It is rather for us to be here dedicated to the great task remaining before us – that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion — that we here highly resolve that these dead shall not have died in vain — that this nation, under God, shall have a new birth of freedom – and that government of the people, by the people, for the people, shall not perish from the earth.
Before Lincoln’s speech and after nearly 100 years of slavery, people did not think of the United States as a country “dedicated to the proposition that all men are created equal,” but after his speech, no true American believes anything else. We all believe it, because that is what the Civil War was about in retrospect – those brave soldiers died for equality. Lincoln interpreted their death for us. He assigned meaning to the bloody battle of Gettysburg, while standing up to the truth. In doing so, he not only gave purpose to the event, but meaning to the country itself.
As you think about the most difficult thing happening in your world and how you might fear your people finding out and freaking out, remember Gettysburg. Be it a deal gone bad, a whiffed quarter, or a layoff, this may be your chance to define not only the event, but the character of your company.