Latest / The Human Factor: Exploring the Intersection of Humanity, Technology, and Transformation / Episode 012: The Lies We Tell at Work - Why Workplace Dishonesty Destroys Transformation

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Episode 012: The Lies We Tell at Work - Why Workplace Dishonesty Destroys Transformation · The Human Factor: Exploring the Intersection of Humanity, Technology, and Transformation

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Let me tell you about a moment that changed how I think about
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organizational honesty. I was consulting with a mid size
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technology company several years ago.
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They had brought me in because a major project launch had failed
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spectacularly and they wanted to understand what went wrong.
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During the post mortem interviews, I sat down with a
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project manager named David. He was a solid performer with
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about 8 years at the company. David told me something I've
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never forgotten. He said I knew we were going to
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miss the deadline by at least six weeks.
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I knew it in my gut three months before launch.
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But every time I raise concerns in our status meetings, my
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director would ask, are you saying you can't do your job?
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So I stopped raising concerns. I started saying what everyone
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else was saying. We're on track.
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We'll make it work. But here's the part that really
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stuck with me. I also interviewed his director,
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a woman named Susan, who was genuinely respected in the
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organization. When I asked her about the
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project's communication breakdown, she said I wish
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someone had told me how bad things really were.
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I wish I would have pushed back the timeline.
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I would have gotten them more resources, but every update I
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received said we were fine. I asked her directly what would
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have happened if David had told you the project was six weeks
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behind. She paused for a long moment,
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and then she said something that revealed everything.
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Honestly, I probably would have pushed back.
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I would have asked him to find a way.
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I would have questioned whether he was managing his team
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effectively. If she shared this with me, she
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caught herself, I guess, she said.
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I'm part of the reason no one told me the truth.
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What struck me about that conversation was how both people
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were trapped. David lacked the courage to
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speak honestly because he feared how Susan would respond.
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And Susan, well, without realizing it, she had created an
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environment where honesty felt dangerous.
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Both of them were good people. Neither wanted the project to
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fail. But the lies they told and the
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lies they enabled guaranteed the failure.
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This is what I call the courage gap, and it operates on both
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sides of every conversation. It takes courage to tell the
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truth, but it also takes courage to hear it.
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I'm Kevin Novak, CEO of 2040, digital professor at the
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University of Maryland and author of the book The Truth
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about Transformation, Leading in the Age of AI, Uncertainty and
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Human Complexity, and the Ideas and Innovations Weekly
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newsletter. Welcome to the Human Factor
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Podcast, the show that explores the intersection of humanity,
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technology, and transformation, along with the psychology behind
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transformation success. Here's something that might make
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you uncomfortable. You lied today.
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Maybe you told a colleague their presentation was great when it
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was me. Mediocre.
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Maybe you said you were almost done with a project you hadn't
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even started yet. Maybe you called in sick when
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you just needed a mental health day.
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And here's what's even more uncomfortable.
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I've done all those things, too. We all have.
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Research suggests that an average person tells between one
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or two lies per day in social interactions.
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In workplace settings, that number increases significantly.
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But here's what confounds me at times as someone who has spent
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two decades studying organizational transformation.
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Those small lies, those tiny acts of workplace dishonesty,
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they're not harmless. They're the invisible force
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destroying your organization's ability to change, adapt, and
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survive. So today we're going to going
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somewhere very uncomfortable. In the next 25 minutes or so,
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you'll discover why people lie at work, the psychology behind
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workplace deception, would it cost your organization, and most
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importantly, why? Addressing workplace dishonesty
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and the courage deficit that enables it is the hidden key to
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change and transformation success.
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Let's start with a fundamental question.
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Why do people lie? Doctor Paul Ackman, the
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pioneering psychologist who spent decades studying
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deception, identified 6 core reasons people engage in
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dishonesty. First, to obtain a reward they
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couldn't get otherwise. Second, to protect others from
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harm or discomfort. 3rd to win admiration or approval. 4th to
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avoid awkward social situations. 5th to avoid embarrassment, and
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6th to exercise control over their own narrative.
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Now here's what's fascinating about this list, known as how
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many of these motivations are fundamentally about self
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protection rather than malicious intent.
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Most workplace lying isn't about getting ahead at someone else's
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expense. It's simply about survival.
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The statistics on workplace lying are sobering.
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According to research published in human resource journals,
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approximately 78% of job candidates admit to lying during
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the hiring process. Once hired, I'm Not Feeling Well
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remains the most common workplace lie, but here's where
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it gets really interesting. Research from David Shulman at
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Lafayette College found that younger employees tend to lie
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more frequently than older colleagues, and employees lie
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more on Mondays and Fridays, essentially extending their
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weekends through deception. Most importantly here,
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dissatisfied employees lie significantly more than
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satisfied ones. So when people feel trapped,
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undervalued, or voiceless, they turn to deception as a coping
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mechanism. It's interesting, isn't it?
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So now let's go deeper into the psychology.
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When someone lies, the brain has to work harder.
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They need to suppress the truth, construct the lie, monitor the
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listen's listener's response, and remember what they said for
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later consistency. This cognitive load is
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exhausting. But here's the twist.
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The brain has a solution. It's called self deception.
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When we lie to ourselves first, we reduce the cognitive burden
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of lying to others. We become more convincing
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because we genuinely believe our own distortions.
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Leon Festinger's cognitive dishonest research demonstrated
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this beautifully. In his classic studies, people
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who were paid just $1.00 to tell a lie actually convinced
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themselves that they believed the lie, while those paid $20
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knew they were lying. The brain seeks consistency and
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certainty, and when our actions conflict with our beliefs,
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something has to give. So in organizational settings,
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this means employees don't just lie to their managers, they
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often lie to themselves first. This project is on track becomes
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something they genuinely believe, even as all the
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evidence they're seeing mounts to the contrary.
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In 2015, researchers Levitt and Sluice published groundbreaking
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work on what they called Identity Baseline.
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Their core insight was that workplace Line isn't primarily
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about self-interest in the traditional sense.
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It's about protecting valued identities.
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Think about it this way, when you identify strongly with your
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role, like I'm a component project manager or I'm a
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strategic thinker, anything that threatens that identity triggers
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A defensive response, and lying becomes a way to protect who you
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believe yourself to be. Remember back in episode 8 when
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I discussed resistance traps and the challenges of identity
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protectionism? This is particularly dangerous
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when identity threats feel intractable, meaning that people
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believe there's no legitimate way to resolve the threat.
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If admitting a mistake feels like admitting you're
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fundamentally incompetent, lying becomes psychologically
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necessary. So earlier research by Grover in
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1993 identified another critical driver of workplace deception,
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structural role conflicts. Organizations often create
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impossible situations where employees face conflicting
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expectations. You're told to be innovative,
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but you're punished for failure. You're expected to meet
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aggressive deadlines but also deliver perfect quality.
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You're supposed to be a team player, but you're evaluated on
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individual metrics. When these conflicts become
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unresolvable, people have lied to reduce the sonocence.
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In like consulting, where I've seen this pattern repeatedly,
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middle managers caught between executive expectations and team
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realities become chronic liars in both directions.
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They tell leadership what they want to hear of, telling the
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teams that everything is fine when it clearly isn't.
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So let's talk about the numbers here.
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According to research published by the Association of Certified
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Fraud Examiners, organizations lose approximately 5% of their
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annual revenues to fraud interception.
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Globally, that translates to trillions of dollars, but the
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hidden costs are actually even larger.
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When employees lie about project status, problems compound until
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they become crises. When teams hide concerns about a
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new strategy, organizations invest millions in initiatives
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doomed to simply fail. When leaders don't hear honest
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feedback, they make decisions based on distorted information.
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And here's the kicker. Research shows that senior
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positions actually lie more frequently than entry level
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roles. One study found that 37% of
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managers admitted to lying at work, compared to 28% of entry
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level employees. The people making the biggest
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decisions, then, often have the most distorted information.
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Let's dive into psychological safety.
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Amy Ed Benson's revolutionary research in the 1990s made a
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discovery that transformed our understanding of team
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performance. She was studying medical teams
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in hospitals, trying to understand why some teams
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performed better than others. What she found seemed
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counterintuitive at first. Higher performing teams reported
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more errors than lower performing teams.
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That didn't make sense until she realized the explanation.
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Better teams weren't making more mistakes, they were simply more
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willing to discuss the mistakes that they had made.
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The insight LED her to the concept of psychological safety,
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which she defines as a belief that you can speak up with
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ideas, questions, concerns, or mistakes without fear of
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repercussions. It's an environment of low
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interpersonal fear where candor and vulnerability are welcome.
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Elizabeth Stewart and I have both sought to emphasize the
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criticality of psychological safety in the episodes of this
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podcast, so let's dive into what psychological safety is not.
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There's a common misperception that we haven't touched on at
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this point yet. Psychological safety is not
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about being comfortable. It's not about avoiding
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conflict. It's not about lowering
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standards or removing accountability.
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In fact, Edmundston's research shows that psychological safety
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and accountability are very two independent dimensions that
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actually reinforce each other. When you have high psychological
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safety but low accountability, you get a comfort zone where
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nothing gets done. When you have high
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accountability but low psychological safety, you can
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hit an anxiety zone where people are too afraid to take risks.
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The sweet spot, then, is the high performance zone requires
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both. People need to feel safe enough
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to be honest and accountable enough to drive for excellence.
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So here's what happens neurologically when people don't
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feel psychologically safe. Fear activates the imegilla,
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triggering fight or flight responses.
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This diverts cognitive resources away from the prefrontal cortex,
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which handles analytical thinking, creativity, and
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complex problem solving. In other words, when employees
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are afraid, they literally become less intelligent.
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They can't think as clearly, they can't innovate as
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effectively or solve problems as creatively.
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And of course, they lie then to protect themselves.
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The organizational cost in this situation is profound.
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Problems go unreported until they become crises.
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Innovation stalls because people fear proposing ideas that might
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fail, and transformation efforts collapse because no one tells
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leadership the truth about what's actually happening on the
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ground. Let me connect all of this to
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organizational transformation. Research from McKenzie surveys
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of over 3000 executives show that only about 1/3 of
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transformation efforts are considered successful.
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That's a staggering failure rate.
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When you dig into why transformations fail, you find
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the same pattern again and again.
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Leaders don't hear honest feedback about what's working
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and what isn't. Employees tell leadership what
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they want to hear rather than what they need to know.
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Problems then are hidden until they become instrumental.
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In essence, organizational dishonesty creates a fundamental
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barrier to adaptation. You can't transform what you
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can't honestly assess, and you can't honestly assess anything
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in a culture where people are afraid to tell the truth.
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So in my human factor method, the first phase is called
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understand, which involves deep psychological discovery before
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any change initiative begins. Part of that effort must include
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understanding where dishonesty patterns exist in your
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organization. This isn't about catching liars
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or punishing people. It's about understanding the
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structural of conditions that make lying feel necessary.
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Where are the impossible role conflicts?
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What identity threats are people facing?
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Where has psychological safety broken down?
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Our Transformation Readiness Assessment helps organizations
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identify these patterns before they sabotage change efforts.
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Because if you launch a major transformation in a culture of
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fear and dishonesty, you're setting yourself up for failure.
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So let's continue here. Edmondson's research provides a
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four step framework for building psychological safety that aligns
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perfectly with my Human Factor Method Principles.
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First, framework as a learning problem.
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When leaders emphasize uncertainty, acknowledge that
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they don't have all the answers, and explicitly state that they
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need everyone's input, it creates a situation where
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permission is there for honesty. Second model fallibility and
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curiosity. Leaders must demonstrate
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vulnerability by admitting their own mistakes and asking
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questions that show genuine curiosity rather than judgement.
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3rd Invite participation proactively.
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Don't wait for people to speak up.
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Create explicit structures and moments where feedback is
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requested and expected. 4th Respond productively.
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This is where most organizations fail.
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When someone speaks truth to power and gets punished, even
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subtly, the message spreads instantly.
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Everyone learns that honesty is dangerous.
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So let me give you some practical actions you can take
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starting tomorrow. Prioritize honesty as a core
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value and actually mean it. Don't just put it on a poster,
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demonstrate it through your actions.
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The truth telling is rewarded even when the truth is
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uncomfortable. Model that transparency
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yourself. Share your own uncertainties,
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your mistakes, and your learning moments.
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If you expect honesty from others, you have to demonstrate
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it first. Recalibrate your performance
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management systems. If your metrics punish honest
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admission of the problems, you're incentivizing deception.
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Createspace for learning from failure rather than the just
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celebrating the successes create visible ethical reminders.
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Research has shown that simple prompts like honesty pledges at
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the beginning of a process can reduce deceptive behavior
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significantly and finally, address the structural
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conditions that make lying feel necessary.
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If people are caught in impossible role conflicts, fix
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the conflicts. If identity threat feels
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intractable, create pathways for people to maintain their sense
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of confidence while admitting mistakes.
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Let me leave you with something to consider.
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The irony of organizational dishonesty is profound.
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Organizations that most desperately need to transform
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often have cultures that punish honesty, Which.
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Guarantees their transformation efforts were failed, which
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reinforces the very problems that made transformation
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necessary in the 1st place. Breaking the cycle requires
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courage. It requires leaders who are
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willing to hear uncomfortable truths and who examine their own
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reactions when someone speaks honestly.
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Remember David and Susan from the beginning of this episode?
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The lies didn't start with David.
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They started with Susan's inability to receive hard news
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without making it feel like an attack on the messenger.
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David needed courage to speak, but Susan needed courage to
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listen. It requires systems make honesty
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safer than deception, and it requires understanding that
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people don't lie because they're bad.
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They lie because they're human, and humans protect themselves.
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The question isn't whether your organization has dishonesty.
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It does. The question is whether you have
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the psychological infrastructure to surface it, address it, and
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transform it into the radical candor that successful change
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requires. You have the opportunity to
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explore two issues of my Ideas and Innovations Newsletter,
21:28
available on 2040 digital.com and Substance.
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The first, Leading with Courage and the second, Why We Lie.
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Both offer the opportunity to further understand why people
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lie and why people lack courage to speak honestly and accept
21:45
feedback. You also get to understand the
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structural barriers to organizational candor and the
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characteristics of courageous leadership.
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If you found this episode helpful, subscribe to the Human
21:58
Factor Podcast. Wherever you listen to podcast,
22:02
leave a rating and a comment, and share this episode with your
22:06
leadership team. Because understanding why people
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lie at work is the first step towards building a culture where
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they don't have to. If you want weekly insights
22:16
about transformation psychology, organizational behavior, and the
22:20
human factors that determine transformation success,
22:24
subscribe to the Ideas and Innovations newsletter on Sub
22:27
Stack or 2040 digital.com. Every week, I share practical
22:32
frameworks and research on why change succeeds or fails.
22:37
Until next time, remember, you can't transform what you can't
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honestly assess. This has been the Human Factor
22:45
podcast. I'm Kevin Novak, thanks for
22:48
watching or listening.