Lemon #42. CEOs should tell it like it is (2nd part)

Lemon #42. CEOs should like it is (2nd part)

While reading ‘The hard thing about hard things’ from Ben Horowitz, we learned some facts that caught our attention and would like to share: 

There are three key reasons why being transparent about your company’s problems makes sense: 

  • Trust

Without trust, communication breaks. In any human interaction, the required amount of communication is inversely proportional to the level of trust.  I mean, If I trust you completely, then I require no explanation or communication of your actions whatsoever, because I know that whatever you’re doing is in my best interest.  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 don’t trust that you’re telling me the truth. 

As a company grows, communication becomes its biggest challenge. If 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. 

  • The more brains working on the hard problems, the better

In order to build a great technology company, you have to hire lots of incredibly smart people. A brain, no matter how big, cannot solve a problem it doesn’t know about. 

  • Bad news travels fast; good news travels slow 

If employees knew about the deadly problems, why didn’t they say something? Too often the answer is that the company culture discouraged the spread of bad news. 

A healthy company culture encourages people to share bad news. A company that discusses its problems freely and openly can quickly solve them. Build a culture that rewards people for getting problems intro the open where they can be solved. 

If you run a company, you will experience overwhelming psychological pressure to be overly positive. Stand up to the pressure, face your fear, and tell it like it is. 

Ben Horowitz @ The hard thing about hard things.

Jorge Moreno

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