Transparency guru: an interview with Tom McManus

Journal of Management Development

ISSN: 0262-1711

Publication date: 1 December 2006

Citation

McManus, T. (2006), "Transparency guru: an interview with Tom McManus", Journal of Management Development, Vol. 25 No. 10. https://doi.org/10.1108/jmd.2006.02625jaa.001

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Emerald Group Publishing Limited

Copyright © 2006, Emerald Group Publishing Limited


Transparency guru: an interview with Tom McManus

Tom McManus is a market and business strategy consultant and attorney, active in strategic information policy issues such as compliance, transparency, privacy, and security. He is a founder and President of Transparency Associates (www.transparencyassociates.com), a consulting firm focused on helping organizations achieve market excellence through openness and dialogue with stakeholders. Tom is a long time Research Affiliate of the Harvard Program on Information Resources Policy where his work has focused on marketing, and competitive uses of regulation. Tom is also a Research Partner with the Information Technology Services Marketing Association (ITSMA), an organization specializing in helping companies market and sell services. Prior to founding his own firm, Tom was a Director of market and business strategy consulting with Gartner Consulting, and was the knowledge management practice leader. Before Gartner, Tom provided venture capital advisory services at Alchemix Capital Corp. Prior to that, Tom was the Director of Consulting at Western Reserve Collaborative, where he created education and technology-based frameworks for business development and cultural change management in the telecom industry. Tom’s business career began in corporate planning and development and acquisitions at Bell Regional Ameritech, where he provided industry and competitive analysis. Tom started his career as an attorney with the US Department of Justice as an honors program appointee where his focus was political asylum.Tom is admitted to the Bar in New York and New Jersey. He has a BA in History and Philosophy from Boston College, and a JD from The Vermont Law School.

Yair Holtzmanis a tax consultant at Ernst & Young. He has over ten years of experience as a management consultant. Prior to joining Ernst & Young, Yair worked at Pittiglio Rabin Todd & McGrath (PRTM) as a consultant in the Chemicals Practice, at A.T. Kearney in the Operations Practice, and at Plating Control Systems as a chemist and founder/president of this research and development consulting firm. Mr Holtzman has successfully performed many engagements in the area of accelerating new product development. His areas of interest and expertise include operations management consulting, process reengineering, and optimizing the research and development cycle. He has guided clients in the chemicals, pharmaceutical, electronics, and automotive industries in unlocking the potential of process and product development. Yair has facilitated their understanding in achieving and creating new enhanced production and research and development capabilities over time. In addition, he is currently interested at exploring opportunity for the applicability of the research and development tax credit and the domestic manufacturing deduction to manufacturing companies in a variety of industries. He received his Master of Science in Accounting with Distinction from Hofstra University’s Zarb Graduate School of Business. He earned his MBA degree from Cornell University’s Johnson Graduate School of Management with concentrations in Operations Management and Marketing. He has passed all sections of the Uniform CPA Examination.Mr Holtzman earned his BA in Chemistry, with High Honors, from Brandeis University and completed the doctoral coursework in Chemistry at the University of Pennsylvania. He has served as a consultant to the pharmaceutical, chemicals, industrial textiles, electronics and automotive industries since 1994.

Harold Lazarusis the Chairman and a founder of Transparency Associates. He is also the Mel Weitz Distinguished Professor of Management at Hofstra University’s Frank Zarb School of Business. Hal was the Dean of that business school for seven years, and for the previous ten years was professor of management at New York University’s Graduate School of Business. He also taught at Columbia University’s School of Business and at the Harvard Business School.Dr Lazarus is a fellow of the International Academy of Management, president of the North American Management Council, past president of the Eastern Academy of Management and a former president of the Middle Atlantic Association of Collegiate Schools of Business.Hal has lectured on management subjects to business and governmental organizations on four continents and served on many corporate boards of directors. His MS and PhD degrees are from the Business School at Columbia University.

Welcome to our first special issue on “Transparency and other hot topics”. So many highly qualified and interesting authors responded to our call for papers that another special issue on transparency is already underway! We are confident that you will find the insights within both useful and interesting. We look forward to continuing the dialogue in the next special issue. The editors would particularly like to thank Michael Kochen, who plans to pursue a dual MBA and JD at Hofstra. Michael played a key role in the development of this special issue. We look forward to his contribution as an editor of the next issue.

Transparency guru: an interview with Tom McManus

Tom McManus is a founder and President of Transparency Associates (www.transparencyassociates.com), a consulting firm focused on helping organizations achieve market excellence through openness and dialogue with stakeholders. The special issue opens with an interview of Tom McManus by Dr Harold Lazarus. The interview provides a useful overview of transparency, and answers many questions about its management implications. This interview explores transparency as both an approach and an outcome in the management of organizations. There are many definitions of transparency. A definition preferred by Tom McManus has two parts:

  1. 1.

    Openness, candor, the free flow of information.

  2. 2.

    Dialogue with stakeholders.

Transparency is a method of regulation of business and government, a means of self-regulation promoted by some to ward off even more intrusive regulation, an information policy of organizations, a term of art in economics, trade, architecture, arms control, corruption, human communications, leadership, information technology, and more. The forces driving transparency, such as technology and globalization, are making it more difficult for business and government to bury their heads in the sand. Stakeholders such as customers, shareholders, and voters are holding management accountable. Information matters and stakeholders have access to an unprecedented quantity and quality of information. Practical application of transparency is not simple, and many qualified and interesting people are developing the field.

Transparency: panacea or Pandora’s box

Eugene H. Rotberg’s expertise is in international monetary affairs, and finance and capital market development. He is an advisor to governments, international institutions, the corporate sector, and serves on boards of directors. Eugene was the Vice President and Treasurer of the World Bank for 26 years. He has served as Associate Director for Market Regulation, Securities and Exchange Commission, and as Executive Vice President, Merrill Lynch & Co. (Risk Management). Eugene received his law degree from the University of Pennsylvania and his undergraduate degree from Temple University.

Theodora C. Welch, PhD, is an Assistant Professor of Management at The University of Massachusetts, Boston. She received her PhD in strategy and MBA in finance from the John Molson School of Business in Montreal, Canada. Her research examines the joint influence of corporate governance and competitive strategy on company performance, with a focus on executive decision-making. Current projects include stock trading by company insiders in science-driven companies, and effects of new media technologies on financial disclosure. Professor Welch has conducted research under several Harvard University Research fellowships and as a Management Consultant with the World Bank. Professor Welch is active in the Academy of Management and the Strategic Management Association.

This paper refutes the conventional wisdom that there are few, if any, negative aspects to transparency and full disclosure. Its purpose is to share with executives, public policy makers, and securities analysts some key behavior constraints on transparency seldom addressed in the professional literature. The focus is on the unexpected and counterintuitive. Areas where quality research could be useful are suggested and explored, e.g. the effects of immediate and widespread disclosure; the pressure for management to be risk averse given the requirement for openness and transparency; the private information paradox; capital flows from public to private equity funds; possible increased probability of insider trading; negative impact on management’s ability to act imaginatively, quickly and privately; optimistic claims by managers of causal connections between transparent interventions and favorable results.

Organization-stakeholder relationships: exploring trust and transparency

From the west coast of Canada, Julia Jahansoozi teaches Applied Communication full time in the Department of Journalism at the University of Central Lancashire in the UK, and she is a PhD candidate at the University of Sterling in Scotland. She has worked in both consultancy and in-house in Canada and the UK. Her research interest is in organization – public relationships.

There is a dearth of business cases dealing directly with transparency in the general business literature. We are very fortunate indeed to have this superb piece from Julia Jahansoozi, which is a result of interviews with oil and gas operators and community members involved in the Sundre Petroleum Operators Group (SPOG) in Alberta, Canada. In Alberta, many oil and gas operations are located near towns and farms. In past years Alberta residents have been up in arms about a substance known as hydrogen sulfide or “sour gas.” Residents blame a rash of public health and environmental problems – from crop damage and childhood illness to miscarriages, livestock deaths and human brain damage – on the flaring and venting of natural gas at drilling sites and refineries. The general manager of Shell in Alberta, an engineer, brought the FranklinCovey organization in (Stephen Covey) to provide workshops – not only to Shell employees – but to the community. Now some years later, Julia Jahansoozi has undertaken a study of the effects of this transparency intervention. Key relational elements such as trust and transparency were examined in relation to their importance for relationship building. Both SPOG industry and community members (n=18) were interviewed. The results indicated that after a crisis, transparency is crucial for rebuilding trust and maintaining healthy community-stakeholder relationships.

Creating transparency around the research and development tax credit

This special issue on transparency would not have come about without the effective, intelligent, and genial driving force that is Yair Holtzman. In this article, Yair Holtzman discusses the dynamics of the research and development (R&D) tax credit. Mr Holtzman is a management and tax consultant with over ten years of experience in the area of strategic research and development. His expertise is in the area of new product development, operations management consulting, and manufacturing process reengineering in the chemicals, pharmaceuticals, printed circuit board, and automotive industries. He is one of those unique individuals that bring technical engineering knowledge, management consulting experience, and tax technical understanding to each of his engagements.

In his article, Mr Holtzman discusses the dynamics of the research and development (R&D) tax credit. Yair explains how this credit can be a hidden and immediate source of cash for many companies that engage in research activities and have invested time, money, and resources to the advancement and improvement of their companies’ products and processes. Taking advantage of the credit could result in a significant reduction to current and future years federal and state tax liabilities. Most successful companies are potentially eligible for a research and development tax credit of some amount, but many companies are unaware that their daily research and development operations can qualify for the R&D tax credit. Over five and a half billion dollars in federal research and development tax benefits are given out annually with 75 percent going to a few of the nation’s largest companies. In addition, he also discusses some of reasons behind having an R&D tax credit, how it works, how it can impact management decision making and strategic implications in a competitive business environment.

Globalization, organizational opaqueness and conspiracy

George S. Roukis earned his PhD in History and Russian area studies from New York University. He held senior-level, administrative positions in the federal government, county government, and higher education. Dr Roukis is an expert in industrial relations with many years of experience as an arbitrator and professor of management. He is presently Professor Emeritus of Management at the Hofstra University, Frank G. Zarb School of Business. George Roukis served as United States Deputy Assistant Secretary of Labor (1973-1975) and as neutral defense referee on the National Railroad Adjustment Board (1977-1992). In 1986, Dr Roukis was appointed by President Ronald Reagan as chairman of an emergency board to resolve a nationwide railroad labor dispute. Finally, Dr Roukis has edited several books dealing with corporate security issues.

This article discusses the dynamics of globalization within an historical context and argues that the rapid organizational changes required by a technologically driven competitive economy necessitate attentiveness to the particulars of organizational design. It assesses the relationship of US National Security Policy to the maintenance of a global economy, and the costs it entails for participants. It points out that the uncertainties created by globalization produce conspiracy thinking that views large organizations as controlling individual behavior. It notes that fast moving changes can create opaque corporate environments where dissonant or criminal actions are likely, and recommends that corporate executives take the extra steps to ensure that decisional transparency is a policy priority.

Healthcare transparency: opportunity or mirage

Dr Russell M. Jaffe, MD, PhD, CCN, NACB is an Integrative Medicine Pioneer. He is an internist, molecular biochemist, clinical pathologist, and diagnostician. Dr Jaffe received his PhD, and MD from the Boston University School of Medicine in 1972. He completed residency training in clinical chemistry at the National Institutes of Health (1973-1976), remaining on the permanent senior staff until 1979. He is board certified in Clinical Pathology and in Chemical Pathology and maintains clinical licenses to practice in a variety of states. Dr Jaffe is the recipient of the Merck, Sharp & Dohm Excellence in Research Award, the J.D. Lane Award, and the USPHS Meritorious Service Award. He was also recognized by the International Biographical Commission in 2003 as an International Scientist of the Year for his lifetime contributions to medicine, biochemistry, and clinical immunology. Dr Jaffe maintains Fellow status in ASCP, ACN, CIS/FASEB, ACAAI, and AMLI.

Robert A. Nash, MD, is Director, Nash Medical Center, Virginia Beach, Virginia Chair, ABCMT and Chair, ABIMP, Board Certified in Neurology.

Richard Ash, MD is Director, Ash Medical Center, New York, New York Host, “Sick and tired of being sick and tired” on WOR Radio, Sunday evening 5-6 p.m., 20 years in Integrative Medical Practice, Executive Committee ASIMP.

Norman Schwartz, MD is Director, Integrative Medical Clinic, Holy Family Hospital System, Milwaukee, Wisconsin.

Robert Corish, MD, is Director, Integrative Clinic, Ft Lauderdale, Florida, Board certified anesthesiologist/acupuncturist

Tammy Born, DO, is Director, Born Medical Clinic, Ann Arbor, Michigan.

Transparency’s role in healthcare management is reviewed for both the emerging consumer driven as well as the conventional healthcare marketplace. First, a definition of terms is offered. Next, a frame for the discussion of healthcare is proposed. This includes the variables needed to write an equation to model healthcare outcomes. The article develops several scenarios in light of different assumption sets that might be chosen over the next few years. The conclusion is that it is possible to return America to a leading rather than lagging position in healthcare; that we can fund this transition out of savings from “diseasecare” costs not incurred; and that we can save 100-300,000 lives annually in the process. The work is consistent with that of John Wennberg, Larry Weed, Gail Wilensky, Paul Starr, Uwe Reinhardt and David Eddy.

Transparency in the age of AIDS: the reality and mythology of a disease

Leonard Hindus is a highly published writer and has consulted for many Fortune 500 companies on marketing and strategy. He has written hundreds of articles and several books. Mr Hindus is currently President of Bowershore Associates, a consulting firm based in Somerset, MA. He has a BA in Communications from the State University of New York at Buffalo.

The goal of this paper is to describe how the lack of transparency about the AIDS disease has affected the spread of this pandemic. The catalyst for this article was an interview with Dr Everett Koop who was the US Surgeon General during the Reagan presidency. Dr Koop was one of the first public health leaders who had the responsibility to describe AIDS/HIV to the public and to help form the US response to the disease. In his interview, Dr Koop describes the problems that government officials in the Reagan administration had with the subject of AIDS. Through the study of the history of information flow and dialogue about AIDS/HIV, this paper demonstrates the importance of transparency to public reaction and response to a life-threatening disease. It shows how our first impressions of a disease can create a mythology that is very difficult to change even when the facts are discovered. This mythology has affected the development of this disease into a full-blown pandemic and continues to slow the advances that medical research has developed to fight the disease.

Organic management of frameworks and systems, but not people: an interview with Richard Davis

We can all learn a very great deal from reading this interview with an extremely creative manager who transformed a small, mediocre firm into a large, superbly well-managed company. Originating as a family retail optical business, modern day Davis Vision’s growth parallels the steady rise in popularity of vision care among companies seeking to contain costs while enhancing their benefits package. Hundreds of industry leaders have embraced Davis Vision’s flexible plan designs, cost-containment and quality assurance mechanisms. Today, nearly 35 million people in all 50 states, Washington DC, Puerto Rico, Guam, Saipan, and the Dominican Republic enjoy the many benefits of the Davis Vision program.

Your opinions about management, leadership, employees and business problems will never be quite the same after considering the ideas of this master of wholistic, organic, integrative management. Richard Davis has had a tremendous impact on a generation of graduate students at the Frank G. Zarb School of Business at Hofstra University as a result of his oral presentations to them. He does not lecture nor use a prepared talk, each is tailored to the questions asked by graduate students. Just as he treats his business associates with great respect, he does the same with his children, wife, friends, and students. All of us who are touched by Richard Davis are profoundly touched in good ways. Readers of The Journal of Management are quite fortunate to have the great wisdom of Richard Davis distilled into a very few pages. It is as if the major works of Peter Drucker were so distilled. So we editors suggest that you read and reread this short piece. We believe you will profit tremendously from doing so. His thinking is tested in the marketplace and is worth your time and effort.

Richard Davis is convinced that we must exceed internal and external customers’ expectations. However, he warns that we must delight internal customers first. Why? Because without delighted associates we will fail to delight external customers. So, it is almost a foolish question, who is more important your associates or your customers. If you do not recognize, respect and reward your associates, they will not do the same for your customers.

What does this require? It requires doing it right!

How do we do that? We must have meaningful relationships with every single one of our internal and external customers. Every single one of them must be delighted. We must exceed their expectations! Every single one of them must be recognized, respected and rewarded. This requires transparency.

Since we do not know the results, the final outcomes, of situations that some might consider problems, Davis asks us to treat these situations optimistically, as opportunities for generating continuous improvement. Of course, these can be constructive, self-fulfilling prophecies. On the other hand, treating these very same situations as problems can create destructive, self-fulfilling prophecies.

Richard Davis prefers being proactive to being reactive, he argues for internal marketing departments in preference to our usual human resources departments. He is convinced that associates must be recruited, selected, oriented, and educated to think, talk, and act like owners and be recognized, respected, and rewarded for doing so.

Whereas many of us believe in results-oriented appraisals, Davis goes a step further. He believes in results-oriented, self-appraisal. What does he mean? Associates measure their performances with respect to the framework of company values and objectives that lead to continuous improvement of individual and organizational performance. This requires that all associates, including those who clean toilets, have business cards.

Transparency and there again

Sharon Hindus was a manager at Digital Equipment Corporation from 1979 through 1993. She held positions as Information Systems manager for the High Performance Systems Engineering group for three years and then moved into the Corporate Information Systems Marketing organization where she worked as a program manager and the Dean of Digital’s IS University, which supported Digital’s sales, services, consulting personnel and customers. After leaving Digital in 1993, Ms Hindus founded her own consulting organization doing IS and management consulting. In 1997, she joined Gartner Group in their management consulting organization.

Ms Hindus was diagnosed with lung cancer in the year 2002 and resides with her husband and two children in Somerset, MA. She does volunteer work for the American Lung Cancer Alliance. Sharon and her husband Len Hindus are actively interested in issues related to disease and transparency. She has a BS of Philosophy from the State University of New York at Buffalo, a graduate of Digital’s Program Management school and a was a participant in MIT Sloan School’s CISR program.

Transparency was a core principle used at Digital Equipment Corporation to build a highly successful company with a corporate culture. Alumnae of that organization have continued to communicate and network as they went in many different directions. Their philosophy has influenced the culture of the high-tech industries.

This article discusses the author’s experiences as a program manager during the 1980s through early 1990s when Digital went from a booming $15 billion company through breakup and downsizing, to its purchase by Compaq Computer in 1997. The article provides a perspective on what it was like to work in a company that valued transparency, and what it felt like when under pressure the company reverted back to a traditional opaque, hierarchical management.

How personal can ethics get?

Samantha Dench is an Executive MBA student of Dr Harold Lazarus at the Frank G. Zarb School of Business at Hofstra University. She is an independent marketing consultant based in Long Beach, NY.

This is a true story. Names have been changed to protect identities. This paper will hopefully make people aware of the problems faced by whistleblowers. A classmate and close friend of Ms Dench told her about an ethical dilemma, and they decided it would make a good ethics case for business school students. The paper tells a story about a person having to make a difficult decision, and the way ethics can play out for an individual whose entire career could be at stake because of that decision. Companies should show more support for whistleblowers even though that can be problematic.

It should not be a risk to say what we know and think.

Enabling transparent leadership – a small business manager’s perspective

Rob Salvatico is an alumnus of the Frank G. Zarb School of Business at Hofstra University, and is the General Manager, and he and his family own, The Wingate Inn, Garden City, 821 Stewart Avenue, Garden City, NY 11530, www.wingateinngc.com

This article discusses the role of transparent leadership in a small, family-owned hotel. It describes the common sense approach that the author as General Manager employs in the development of a transparent workplace.

A short series of fundamental management philosophies that find their root in transparency are used to describe his approach to transparent leadership and the resulting benefits. The author relates an actual situation that developed within the hotel’s housekeeping management team, and how he was able to avoid a potentially explosive and costly situation through a direct and open application of these core management disciplines.

Mr Salvatico contends that the promotion of transparent management principles to his associates will result in the exercise of these same principles by them in their day-to-day management of the Hotel, their relation with hotel guests, and with one another. His goal is to create a more productive, open work place and ultimately more satisfied, loyal guests.

The article is written to provide the reader with an every day approach to management from the small business perspective. It is intended to remind the reader that straightforward dealings and common sense can provide effective solutions in a constantly changing and challenge-filled environment.

Authenticity and transparency in the advertising industry, an interview with John Morris

John Morris is the Chief Operating Officer of Young & Rubicam Brands. John is a 24 year Y&R veteran and a Managing Partner for Young & Rubicam Brands’ companies and provides executive oversight for its Accenture, Microsoft, and Sanford Clients. Prior to this John was Chief Operating Officer of Y&R’s flagship office in New York. John has also held positions at Wunderman, Young & Rubicam Brands direct marketing company, where he was Managing Director, running the AT&T and IBM accounts. From 1993-1995, John was Chief-of-Staff to Peter Georgescu. John played an instrumental role in shaping Y&R Inc.’s global corporate strategy as well as the integration model being used today in support of its global client partners. Prior to John’s role with Mr Georgescu, he was Senior Vice President, Management Supervisor on the Xerox account at Y&R Advertising. Early in his career, John worked on a number of assignments in account management and in media, where he began his career in 1982.

Corporate and financial transparency go hand in hand with authentic brands that consumers trust. Brands must stay true to what they are, especially when a brand or company is in crisis. Bill Ford, Chairman and CEO, of Ford is an example of an authentic and truthful leader who is out front explaining to the American people what he is doing and why. Advertising professionals and students with an interest in marketing will learn some key facts about how one of the world’s largest and most successful advertising companies operates.

Transparency, communication and mindfulness

Inci Ozum Ucok, Assistant Professor, Department of Speech Communication, Rhetoric and Performance Studies at Hofstra University (PhD, The University of Texas at Austin), teaches courses in gender and intercultural communication, interpersonal communication and small group communication. Her research interests include the study of language and social interaction, ethnography of communication and visual communication. She is particularly interested in studying the presentation of self, selfhood and exploring the ways in which images constitute who we are. Dr Ucok published papers on how people interactively make sense of art, and the aesthetic consequences of cancer treatment. Her recent work includes the transformations of self in surviving breast cancer in relation to changes in bodily appearance.

The author introduces the idea of transparency of understanding from a communications perspective, and mindful listening as a mode of communication to achieve it. Practical methods to achieve mindful listening are described. Transparency of understanding is publicly and interactively achieved through carefully orchestrated visible and audible behaviors. Drawing on spiritual traditions and language and social interaction research, the author suggests that our active and verbal input, our receptivity and embodied presence, including body orientation, facial expression, and eye behavior are significant factors in creating and displaying transparency of understanding. If we could actually be present to listen to each other in the workplace with attention, we might minimize much misunderstanding and confusion, and reduce the amount of time and energy we spend in repairing what we might have missed or misunderstood because we were not really paying attention.

Corporate information transparency

Carol Simon is an Assistant Professor of Library Services and Business Reference Librarian, Axinn Library, Hofstra University. Carol has a business management background. Prior to Hofstra, she met and anticipated the information needs of internal clients providing library services in the manufacturing and financial services sectors for over ten years. Education: BA (History), MLS, MA (Urban Affairs) Queens College CUNY.

The purpose of this paper is to introduce the concept of information transparency in a for-profit business environment, and explain the importance and relevance of the concept in creating a transparent organization. In a corporate environment, information transparency is reached when internal decision makers receive, at their desktop, the internal and external information necessary to make sound business decisions. The infrastructure and the technology of the computer systems used to deliver the information are not of primary importance to information transparency. Information technology systems are the means of delivery, the importance and value of information transparency is the content of the message and the actions that result from them.

Through a review of a sample of the existing literature focusing on transparency, a common theme regarding information was observed. Most research addresses information from a technology/systems perspective not as a basis of creating or modifying corporate strategy. This analysis may provide a rationale for the introduction of a new or expanded corporate information service outside the structure of an information technology department.

Tom McManus, Yair Holtzman, Harold Lazarus, Johan AnderbergGuest Editors