I need your help
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JWI 522
Strategic Partnering with the C-Suite
Week Seven Lecture Notes
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JWI 522 (1192) Page 2 of 7
TRUTH AND TRUST
What It Means
The vast majority of companies do the right thing. The same is true of employees. However,
from time to time in the life of nearly every business, something will go wrong. Someone will
make a morally questionable decision, cross a line that shouldn’t have been crossed, and
occasionally, even engage in criminal activity. In such times, HR leaders are often called upon
to step into the middle of a firestorm and help the organization make sound ethical and legal
decisions that safeguard company assets and protect the rights of the individual.
Why It Matters
• Employees will stand behind leaders who are honest with them and will give it their all,
even when the future is uncertain.
• Trust opens the lines of communication and empowers people to share ideas freely
without fear of reprisal.
• Candor is a tool of speed that cuts through the clutter and gets to what really matters.
“Leaders establish trust with candor, transparency, and credit.”
Jack Welch
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JWI 522 (1192) Page 3 of 7
DEVELOPING A CULTURE OF TRUTH AND TRUST
What does it mean to have a culture of truth and trust?
It goes without saying that you must follow the law. Your workplace must be free from biases that
discriminate against sexual orientation and religion and it must provide a safe and secure environment for
people in need of special accommodations, but it’s more than that. It’s about establishing a culture where
employees are confident that leaders will tell it like it is.
Telling it like it is should be a principle that is familiar to JWMI students. For Jack Welch, this is
expressed in a single word: candor. While it would be impossible to reduce the entire body of Jack’s
leadership lessons to a single practice, if we had to single out just one as being the foundation upon
which everything else is built, we would probably vote for candor.
For Jack, candor isn’t simply a belief in always telling the truth because it’s the right thing to do. Candor
is, in his words, “a tool of speed.” Candor, “cuts through the clutter of ‘business speak’ and gets to what
really matters.” It requires people to face facts and to share information openly. That includes not just
feedback on individual performance and letting people know where they stand, but also information about
how the business was doing. This is something Patty McCord strongly agrees with:
“One of the most important insights anyone in business can have is that it’s not cruel to tell
people the truth respectfully and honestly. To the contrary, being transparent and telling people
what they need to hear is the only way to ensure they both trust you and understand you.”
Powerful, P. 32
Building an organization that truly embraces candor as a way of life is not an easy task. In fact, Jack says
it was one of the toughest things he did at GE. That sounds a bit strange, doesn’t it? It seems simple
enough, just tell the truth, but there is a little more to it than that. The reality is that we are fighting against
millennia of human conditioning. People don’t want to deliver bad news. We don’t want to tell others
they’re not doing a great job or that things aren’t going well. We want to hold off in the hope that it will get
better.
A problem that plagues far too many organizations is that upper management keeps an excessively tight
hold on performance information. Such a mindset does a huge disservice to the organization for two
primary reasons:
1. Not sharing information about performance – both at the individual or corporate levels – robs
people of the chance to make meaningful changes in their own performance or change in how
they manage their teams and their businesses.
2. It undermines the opportunity to get every brain in the game. Sharing information more openly
allows the entire team to come together and attack the problem, think about other ways of doing
things and find better solutions.
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JWI 522 (1192) Page 4 of 7
The tough thing about building a culture of truth and trust is that it’s not always pleasant. It often means
delivering some pretty harsh news. The thing is, however, that while not everyone will like what you have
to say, at least they will know where things stand. People are a lot more willing to rally behind a leader
they trust even when the odds are against them than they are for someone they think is hiding the facts.
“Too often upper management thinks that sharing problems confronting the business will
heighten anxiety among staff, but what’s much more anxiety provoking is not knowing. You
can’t protect people from hard truths anyway. And holding back truth, or telling them half-
truths, will only breed contempt. Trust is based on honest communication, and I find that
employees become cynical when they hear half-truths. Cynicism is a cancer. It creates a
metastasizing discontent that feeds on itself, leading to smarminess and fueling
backstabbing.”
Powerful, P. 42
Having a seat at the table presents HR leaders with the opportunity to guide decisions on how and when
information gets shared from the top down, as well as how feedback from the bottom up is encouraged
and rewarded.
“The other vital point about honesty concerning business issues is that it’s got to go both
ways. Employees should be told never to withhold questions or information from you or their
direct superiors. As a leader, you should model this, showing, not just telling, that you want
people to speak up and that you can be told bad news directly and disagreed with.”
Powerful, P. 43
This behavior has to be modeled at the senior-most levels of the organization. Management has to
demonstrate that when team members come forward with problems, the manager and the team rally
around to support the person and address the problem head-on. If you bring a problem forward and
management jumps down your throat, as Jack says: “That’s the end of candor.” Building a culture of truth
and trust requires that we, as HR leaders, work with our colleagues to foster an honest sharing of ideas,
present a realistic assessment of performance, and encourage open debate where opposing views can
be expressed without fear of reprisal.
HR AS PEOPLE ADVOCATE
In examining what HR needs to do to get a seat at the table, much of our focus has been on addressing
the problem that too many HR departments don’t align their activities well enough to the needs of the
business. We hope that our focus on promoting a “people first” agenda has been clear and consistent.
We firmly believe that people are the most important part of any organization and that effective talent
development practices are critical to building a winning organization and creating a sustainable
competitive advantage. But getting a seat at the table doesn’t give HR the right to abdicate its role as
people advocate.
There will be times, in even the most people-centric organizations, when choices will be presented that
create a tension in which for the business to win, some employees will have to lose. We can’t be naïve
about the realities that there will be choices that make good business sense, but which will have a
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JWI 522 (1192) Page 5 of 7
negative impact on individuals who have given a lot to the company. There will be times when layoffs
happen, when teams become redundant and when factories have to be relocated. When faced with such
situations, what is the role of the CHRO as an advocate for people?
While the circumstances around such events will vary widely, Conaty and Charan argue that one thing is
critical … the strength and character of HR leadership.
“The key issue is whether the HR leader is strong enough to face off with a tough CEO and CFO
and be a true employee advocate without getting rolled.”
The Talent Masters, P. 51
Having a seat at the table does not mean that you can’t ever oppose the boss’s point of view. CEOs
need honest counsel. They need people around them who will push back when needed, and who will,
respectfully, but firmly, support an opposing view. Standing up to a tough CEO can be painful, and in
extreme cases, it can be career limiting.
Over the years, there were numerous times when Bill Conaty supported a position in opposition to Jack.
This was a stance that, as I am sure you can imagine, is not for the faint-hearted. But Jack encouraged
this. In fact, Bill would likely not have been around long if Jack did not feel he could count on him to
speak his mind and be an advocate for what he felt was right. Did that mean Bill always got his way? Of
course not, but it did mean that the facts and the arguments were put on the table and debated honestly.
Jack knew that Bill could always be counted on to be an advocate for people and to fight for what was
right when tough decisions had to be made.
MAINTAIN A CONFIDENCE OR TAKE OFFICIAL ACTION?
This is not a course on workplace law or industry compliance. We trust that, as an HR professional, you
are well acquainted with the regulations that you and your team must follow and that you participate in
regular training to stay on top of things. Further, we expect that you are working with your organization’s
legal team, and are seeking external or specialized counsel when needed. But there will be times when
the path forward in dealing with an ethical or legal issue is not as clear as we would like.
It would be wonderful if we all had access to a set of rules that covered every single circumstance and
told us when we should officially report something and when we need to maintain a confidence. The
reality is that each situation is different. There are, nevertheless, core questions that every HR leader
must ask when faced with a tough decision.
• Does the person bringing an issue to me want me to do anything with it?
• Is there a potential that a law is being broken?
• Is there a risk that, if I don’t escalate the matter, the company will be put in jeopardy?
As those questions get assessed, they will lead to a decision about whether the issue must be brought to
the CEO or should be dealt with by the HR leader. In bringing an issue to your boss, however, there is a
right way and a wrong way to do it. An important part of being a trusted advisor is also being seen as a
competent manager. A competent manager doesn’t add work to the boss’s day; she takes it away.
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JWI 522 (1192) Page 6 of 7
Bill would frequently have to knock on Jack’s door and say, “I want you to know what’s going on with such
and such … I don’t need you to do anything about it, I’m handling it and will keep you updated.” Taking a
problem to your boss without bringing a solution is not the way to demonstrate your potential as a leader.
When assessing your decision about escalating a problem, ask yourself: Is this something that the boss
even needs to know about? Does it impact the organization in a way that requires the attention of the
person you are bringing it to? If the answer is no, then deal with it yourself or hand it to someone at the
appropriate level to take care of it. If the answer is yes, then does it require action from your boss, or
does the boss just need to be informed? The only problems that should land on the desk of a CEO are
the problems that can’t be handled by anyone else down the ladder. That’s a pretty tall order.
When you do bring a problem to the CEO’s attention, make sure you come with as much information as
you can about all the relevant factors. It’s true that when something is unfolding quickly in real time and is
important enough that the CEO has to be updated, you are unlikely to know everything that’s going on,
but gather as many facts as you can first, and make the initial briefing detailed enough that the risks,
options and ownership of action items are made clear.
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JWI 522 (1192) Page 7 of 7
GETTING THE MOST OUT OF THIS WEEK’S CLASS
As you read the materials and participate in class activities, stay focused on the key learning outcomes
for the week:
• Explore the importance of developing a culture of truth and trust
Is management trusted in your organization? How do you know? What tools have you
deployed to reach that conclusion? Anonymous surveys, exit interviews? Off-the-record
discussions? Have you discussed the role of candor as “a tool of speed” with your team and
with other leaders? What concrete actions could be taken to identify and address trust issues
that may be holding the business back? How would things change if there were a significant
increase in the level of confidence that all employees were being told the truth and were treated
fairly, regardless of their level in the organization?
• Discuss the role of HR as a people advocate and steward of the business
How do senior HR leaders balance being advocates for people and strategic drivers of the
success of the business when conflicting interests arise? What are the checks and balances that
must be in place to guide your actions? How can having a strong and clear Mission and a set of
Values/Behaviors help all parties to make better decisions for the business and the employee?
• Assess when to maintain a confidence and when an issue must be officially addressed
What support mechanisms do you have in place to guide your decision-making process when
there are tough ethical and legal decisions to be made? Do you have your own trusted mentor
you can go to as a sounding board, knowing that things will be kept confidential? Are you fully
versed on the laws and regulations that outline when official action must be taken? How do you
escalate an issue without dumping it on someone else? It is important to have these guides be in
place before they’re needed. You don’t want to find yourself searching for a roadmap in the
middle of an ethical or legal crisis.
