Company secrets travel fast

The paradox of organizational secrets

by Dave Potter

The day before a retreat for a high-tech firm, I was in bed with a fever of 104 and a throat so sore that it hurt to even whisper. I didn’t want to cancel because scheduling the retreat so that all forty people could be there had been next to impossible. What to do?

As if to help me decide, the VP called at nine o’clock that night to say that both the president and the marketing manager had left town for an emergency customer visit and wouldn’t be at the meeting, and, by the way, could I do him a favor?

He was going to tell me something that I couldn’t tell anyone else: there was a particular issue that “couldn’t come up” at the meeting. I said, “You mean about your engineering manager, Fred, being let go?”.

He said, “WHAT!?! Who told you? Only the president and I were supposed to know! We promised Fred we’d keep it under wraps. He’s going to be there tomorrow, and to talk about this at the meeting would be breaking the promise we made him!”

When I told him that every one of the ten people in the company I had talked to had mentioned Fred’s leaving, he said, “That means everyone must know!! HOW did this get out?!?”

Fred’s leaving the company was an important issue because a number of people in his group thought he had been made a scapegoat for slow progress on a key project. Yes, they had missed deadline after deadline, but was he, alone, responsible? Didn’t his team have a right to know he was being terminated? Letting him go without giving him a second chance and without even telling his co-workers seemed cowardly and unjust to them, and many were hoping to air their feelings at the retreat.

Between my being sick and these new developments, there was little choice but to re-schedule the retreat. Had we not, we would have been in a “Catch-22” situation. In a forum designed to be open and inclusive, an important group issue would have been off-limits, because Fred had been promised his leaving would be kept confidential. Although all forty people knew, he didn’t know they knew.

How did this happen?

News that is perceived to be important to the well-being of an organization (such as down-sizing, key people being laid off or fired, re-organization, extremely bad or good financial news), travels very quickly, even without formal announcements.

Trying to prevent news from getting out by swearing people to secrecy can actually make matters worse by elevating its perceived importance. It’s like trying to douse a fire with gasoline. This makes the news REALLY hot, and it travels all the faster.

Of course, people who know will be responsible and tell only those people they trust. There’s a saying that illustrates the absurdity of this:

“I can keep a secret. It’s the people I tell it to that can’t.”

Even in the unlikely event that those in the know somehow exercise extreme self-control and don’t tell anyone else, people seem to have ESP when something important is going on that they are not being told.

If the only clues are what is not being said, or how key people act when certain subjects come up, a group has an uncanny way of piecing together a story that is eerily similar to the truth. Unfortunately, like the parlor game of “telephone”, there are no open channels to verify the facts, and distortion enters.

In Fred’s case, it turned out that there were significant gaps between the rumors circulating and the facts:

RUMOR: Management needed a scapegoat for the project’s dismal progress, and they were forcing Fred to leave without giving him a second chance.

FACT: Fred had asked to be relieved of his management duties four months before, but the VP had encouraged him to stay. Despite valiant efforts, it soon became clear to both Fred and the VP that Fred was in over his head. The biggest problem wasn’t the missed milestones, but Fred’s difficulty in estimating and communicating just how far from completion they were. His estimate for completing the project had remained the same for the entire four months: “one more week”.

RUMOR: Management had kept his termination a secret because it was ashamed of what it was doing to Fred.

FACT: The VP felt responsible for hiring Fred in the first place, and suggested that he stay as long as he needed to find a position in another company. It was Fred who asked that no one be told about his leaving.

Being open about Fred would have been difficult, but not doing so created unnecessary pain and distrust.

Does this mean that all confidential information must be made public? Of course not.

There are issues that are truly private. But, for issues which are perceived to affect the welfare of the group as a whole, “organizational secret” is an oxymoron, and there are usually only two choices. Either attempt to hide it and watch the group make things up which travel haphazardly and distortedly through the organization, or make the difficult decision to announce it clearly and directly.

Sigmund Freud was once asked to summarize his life work in a single sentence. He said, “Secrets make you sick.” If Freud had treated organizations instead of people, he might have said, “Secrets make organizations sick.”

Originally published by the Lewiston Tribune - Business Times, February 1998, Lewiston, Idaho