by Barry Lenson

Ingage Consulting’s merger with Tortal Training in 2014 had all the earmarks of a sound business decision. Ingage, based in Woburn, MA, had extensive management and leadership consulting experience and a small client list. Tortal, a leading developer of training programs and eLearning solutions, had a large client list and was posed for growth. Ingage could add content and expertise and Tortal could bring clients.

There were many opportunities for cross-organizational support and shared growth. But then Evan Hackel, Founder and Principal of Ingage and Cordell Riley, President of Tortal, discovered a major culture difference. Tortal was previously a part of a much larger company, and although the Tortal staff was very close-knit, Tortal was somewhat isolated from its companies with which it had partnered.

But both companies had one asset in common. “It became clear that both Tortal and Ingage were highly committed to creating a supportive and caring environment for all employees, “ Cordell Riley explains.

Evan Hackel agrees, and adds “We both value our people, and that means trying to treat everyone as ethically as possible.” He believes so strongly in ethical leadership that he recently wrote and published Ingaging Leadership, a book that lays out a philosophy of leadership that relies on listening deeply to everyone in an organization, supporting them, and affording them opportunities to contribute, grow personally, and express their own values through their work.

What ethical initiatives are these two committed executives putting into practice in their newly merged enterprises? Let’s take a closer look.

All Financial Information Is Shared with All Employees

There are no closed books – only open ones. Information on profits and losses can be reviewed by everyone. “This is really important,” Evan says. “Every quarter, at the monthly all-hands-on meeting, we review financial statements and answer questions.  “In the early days after the merger when we were making significant investments in technology and content, the financial statements didn’t look so great. We were anxious that people would be fearful after looking at financial statements, which showed losses at the time. But the opposite in fact happened, since the biggest fear is actually the unknown. By opening our books and working with the whole team to develop a strategy for how we as a company could to grow and succeed, we created a real bond. Ultimately, that led to the company becoming very successful.”

Yet Evan believes that sharing financial information at that time was not only ethical, but growthful. It let people know and evaluate their own job security rather than being in a vacuum. And from their side of the equation, the company received a higher level of commitment from employees. Evan summarizes, “they knew we weren’t hiding anything.”

The Companies Share Everyone’s 360ᴼ Job Review Comments

Evan and Cordell believe in 360ᴼ job reviews for themselves, in which their performance is reviewed not only by each other, but by everyone in the company. But both company leaders take 360ᴼ reviews a step further too, by sharing the comments they receive with all employees.

“This sends a message that we are, insofar as possible, a company of people who don’t subscribe to hierarchical structures in which supervisors get to comment on the performance of the people they supervise, but not the other way around,” Evan Hackel observes. “Both Cordell and I need to hear what people think of us.”

Cordell adds, “I was a little nervous at first, not everything was positive for either Evan or me, yet we got to see everyone else’s performance reviews, so it only seemed fair”.

The Companies Stay Profitable by Investing in Growth, not by Firing People

“Letting people go is one way to influence the bottom line – or at least to appear to be profitable,” says Evan Hackel. “But it is a bad way, and the damage can be considerable. Once you let capable employees go to cut costs, you lose the income and value they can potentially contribute. And there is no guarantee that the good people you cut will be waiting for you to call when you need them again.”

Instead of firing people, Evan favors moving people into other jobs. For example, a marketing executive at Tortal was moved over and became a training developer for a time, when that skill was needed and there was less money to spend on marketing.

The fact that everyone had seen the company financials probably made those shifts more understandable and supportable among employees. Some of the affected employees report that the knowledge they gained in new areas enhanced their overall abilities and added new perspectives they could use when they returned to their original jobs.

Employees Help Develop Both Companies’ Missions and Vision

Both company leaders take extra care to communicate to all employees their companies’ mission and vision for the future. But they also encourage all employees to help decide what their companies can and should stand for, and what they can become.

“At the start of the merger, with all the investments, we were losing money.” Says Cordell Riley. “The easy answer seemed to be to cut expenses to be more profitable. But we were going to invest in the company to become profitable The idea that emerged through the ranks was that we were going to invest and grow, not shrink.”

To that end, a program called Operation Fast Forward was developed to speed up the growth and systems to support growth. The plan was built in an open forum where the entire staff met and contributed ideas and suggestions that were used to make the best plan possible.

Operation Fast Forward is just one example of how ethically sound ideas can create better places to work, build stronger organizations, and achieve stability.

About Barry Lenson

Barry Lenson, who edits the blogs for both Ingage Consulting and Tortal Training, is a business journalist and author with more than 30 years of experience. He has held top editorial positions at The National Institute of Business Management, Boardroom Publications and elsewhere. Barry has written and co-authored more than a dozen books, including the Amazon.com self-help bestseller Good Stress, Bad Stress.