Prospect Theory and Transparency

The subject of “trust” comes up regularly in different conversations and contexts. Worth noting:

From Len Wilson in “ministry matters” article from 2016:

Prospect Theory is the idea that we fear loss more than we value gain. In other words, the fear that we might get in trouble is so intense that if there’s even a hint of judgment we will shut down our creative thinking.

The way you move past that is you demonstrate — i.e., you lead others — into an environment in which risk is normative, or at least acceptable. You stop punishing failure.

I can hear it now from some corners of the room — of course, you still name expectations. Of course you maintain a sense of accountability. But on top of those things, you respect your team.

The top way to do this is by getting rid of the sharks. Create a sense of safety and security. And the best way to create safety and security is through transparency.

As a creative leader, I try to tell “why” to my team, all the time. I want to them to know my motivations and the thinking behind my decisions. I also ask them their opinions on some matters.

Sometimes, I have to clarify that transparency isn’t permission to second guess my leadership, but that’s okay. Transparency creates empowerment, and empowerment when embryonic can come across as impertinence. I can coach my team through that to a healthy sense of mutual respect.

The downside of transparency is worth the trouble, because the upside is trust. When your team-members trust you, they are open about their passions, motivations, and dreams — their heart.

And if you listen (not just hear, but really listen) to their heart, they will give you their very best effort.