In one, staff were surprised to hear that the firm had to satisfy shareholders, as well as customers, to survive. No-one in authority had bothered to mention it. In another, a purchasing manager nearly bankrupted the firm because nobody told her that cash was tight and she needed to plan purchases carefully. A 'need to know' policy is probably right if you are MI6, but for the rest of us it's dangerous. Here's why ...
It prevents staff supporting your objectives. Your employees want to help the firm do well, but they can only do this if they know what your objectives are and how well they are being met. So tell them.
Secrecy stokes rumours. Like nature, information abhors a vacuum. If you don't communicate, the rumour mill will fill in the gaps, and rarely to your advantage. So say it like it is and kill idle speculation.
Secrecy breeds mistrust. I know, as someone who opened the Observer one Sunday morning to find that the business of which I was a director was up for sale. Even the most professional of us is only human: you can imagine how motivated I was to help with the long and complicated sale process that ensued.
Truth will out. When it does, those leaking it will have their own agenda. Beat them to it and get your version of the story out first.
Most organisations would do better to reverse their default setting for information and share everything, unless there's a good reason not to. You want everyone to be on the same side, striving for a better financial performance, so ask yourself what they must know to do their best. It's probably more than they know now.