Your business can die even while customers love you.
I'm watching it happen all around me right now. The customers are still happy. The product works—for now. But inside, the company is rotting.
Team morale has crashed. Nobody trusts the leadership team. Key employees have mentally checked out or already quit. Quality is starting to slip—it's only a matter of time before customers notice and leave too.
The cause? The executive team stopped talking honestly to their team.
What Silence Does to Your Business
The executives hide financial problems. They avoid tough conversations. They pretend everything's under control when it's not.
Behind the scenes, things are bad. Every department must cut 20% from their budget. Managers can't figure out where to cut without breaking customer promises or letting a few people go.
The smart move would be to involve the team. They know where to find savings without hurting quality. But the execs fear questions they can't answer (“What if we can’t meet the 20% mark without firing people?!”). They worry about causing panic.
So instead, fear and rumors spread.
This Isn't Just "Culture"—It Hurts Your Bottom Line
Research backs this up. Organizational silence doesn't just sit there—it actively grows and causes damage throughout your company (Morrison & Milliken, 2000).
Neuroscience shows something interesting as well: uncertainty triggers stronger negative reactions in people than confirmed bad news (Hirsh & Inzlicht, 2008). We handle known problems better than mystery threats.
When leaders kill engagement through poor communication, they directly attack the financial foundation of the business. Meta-analyses show transparent leadership correlates with better financial outcomes, even during challenging periods (Schnackenberg & Tomlinson, 2016).
Research from Gallup consistently finds that employee engagement drives financial performance, with communication as a key driver (Harter et al., 2020).
A Different Way: My SurveyMonkey Story
I've seen the opposite approach work miracles. I was part of the leadership team at SurveyMonkey when CEO Dave Goldberg unexpectedly died in 2015.
Dave's death devastated me personally and it shook our entire organization.
But our executive team made a critical decision:
We chose radical transparency, similar to what Brown (2018) describes as leadership vulnerability. We admitted our uncertainty. We created clear communication about what would happen next.
We didn't hide in conference rooms making secret plans. We brought employees into the process of honoring Dave's legacy while moving forward.
We held all-hands meetings where people could grieve together AND ask tough business questions.
The results? Nobody left the company for 2 years—the highest retention rate I’ve ever seen in my entire 30+ year career. Business continued without disruption. The company thrived and eventually went public in 2018.
I witnessed firsthand how shared vulnerability became our strength, not our weakness—exactly what Edmondson (2018) describes as psychological safety in her research.
Five Ways to Break the Silence
If your business faces financial or operational challenges, follow these principles:
- Show your cards. Especially when things get tough. The trust you build becomes your most valuable asset. Recent research indicates that trust, once broken, requires exponentially more effort to rebuild than to maintain (Schweitzer et al., 2006).
- Ask your team for help. The people closest to the work often have the best cost-cutting ideas that won't hurt quality. Detert & Burris (2016) found that organizations where employees speak freely perform better.
- Say "I don't know" when you don't. Teams handle honest uncertainty better than fake confidence. The Anxiety Transfer Model (Hirschhorn, 1988) shows that leaders who hide problems to "protect" employees are actually transferring their own anxiety.
- Create regular update channels. Don't let the rumor mill become your main information source. Knight (2015) found structured communication prevents misinformation during crises.
- Explain the "why" behind changes. Context helps people accept tough decisions. Sinek (2019) emphasizes that understanding the purpose behind actions drives commitment.
Great leaders understand that transparency isn't just about being nice—it's a strategic advantage. By bringing teams into the challenge, you get better solutions and stronger commitment.
The Uncomfortable Choice That Defines Your Legacy
Every struggling leader faces the same choice: have uncomfortable conversations now or deal with much bigger problems later.
Communication debt collects interest daily. What starts as internal problems will eventually reach your customers.
The question isn't whether transparency feels comfortable—it rarely does during tough times.
The real question is: can your business afford the alternative?
References:
Brown, B. (2018). Dare to Lead: Brave Work. Tough Conversations. Whole Hearts. Random House.
Detert, J. R., & Burris, E. R. (2016). Can your employees really speak freely? Harvard Business Review, 94(1), 80-87.
Edmondson, A. C. (2018). The fearless organization: Creating psychological safety in the workplace for learning, innovation, and growth. Wiley.
Harter, J. K., Schmidt, F. L., Agrawal, S., Plowman, S. K., & Blue, A. (2020). The relationship between engagement at work and organizational outcomes. Gallup.
Hirsch, J. B., & Inzlicht, M. (2008). The devil you know: Neuroticism predicts neural response to uncertainty. Psychological Science, 19(10), 962-967.
Hirschhorn, L. (1988). The workplace within: Psychodynamics of organizational life. MIT Press.
Knight, R. (2015, March 13). How to communicate during an organizational crisis. Harvard Business Review.
Morrison, E. W., & Milliken, F. J. (2000). Organizational silence: A barrier to change and development in a pluralistic world. Academy of Management Review, 25(4), 706-725.
Schnackenberg, A. K., & Tomlinson, E. C. (2016). Organizational transparency: A new perspective on managing trust in organization-stakeholder relationships. Journal of Management, 42(7), 1784-1810.
Schweitzer, M. E., Hershey, J. C., & Bradlow, E. T. (2006). Promises and lies: Restoring violated trust. Organizational Behavior and Human Decision Processes, 101(1), 1-19.
Sinek, S. (2019). The infinite game. Portfolio/Penguin.