Every organization has rumors. Whether you’re working on a dispersed team or in an office, rumors are part of work life and culture. What begins at 8am Monday morning as a casual chat around the watercooler or through Slack can quickly evolve into hushed tones and rumors about the organization.
Sharing and spreading rumors can be detrimental to an organization, and at its most basic level can simply be a waste of time; employees using up valuable on-the-clock hours instead of being productive.

According to a survey done by HubSpot examining the primary productivity prohibitors, respondents ranked gossip in the number 2 spot at 42%, followed only by cell phone/texting (50%). 1

Although rumors are frequently associated with negativity, not all rumors are bad. Leaders can benefit from separating the benign rumors from the harmful ones, and by understanding why rumors start and spread. If rumors are unavoidable, it is in a leader’s best interest to acknowledge that rumors exist and understand what their root causes are. Great leaders are able to separate the specific details of a rumor from what it says about their organization, and learn about their team in the process. They are able to discern which rumors need their attention and which can be ignored. They are able to recognize where and with whom to focus their efforts.
Sometimes this may feel easier said than done. But by deconstructing rumors in the workplace, whether in person or dispersed, it's possible to shed light on the underlying issues and the variables that shape them and determine when to address them or let them be.

The 4 Root Causes of Rumors

As explained by Dr. John Daly, a noted expert and professor of leadership and interpersonal communications at the University of Texas at Austin, rumors are a function of the 4 following variables:
  1. The level of anxiety of the person hearing the rumor
  2. The rumor originator’s level of credibility
  3. The level of subject matter importance to the person hearing the rumor
  4. The overall level of ambiguity within the environment
All four variables must often be present to seed a rumor because, as Dr. Daly puts it, “if any of these variables goes to zero, rumors dissipate.” It is essential to examine these four variables in relation to a rumor to understand why it is happening.

VARIABLE #1: The Level of Anxiety of the Person Hearing the Rumor

The first variable involves the level of anxiety the person hearing the rumor is experiencing. Anxiety may be rooted in the workplace or entirely unrelated, but it still produces the same result. When a rumor crops up an anxious individual may be triggered about the information they are hearing. This can result in increased levels of distress, anger, or frustration. It may be that employees do not feel there is a sense of psychological safety in the workplace, or in more extreme cases indicate a toxic climate. Or, employees might not feel comfortable discussing what they’re anxious about. This may indicate a need for increased trust and transparency between you and your team. Anxiety is also fueled by uncertainty, which occurs in environments that lack clear expectations, focused goals, or defined objectives for employees to work towards. While you should not attempt to control personal anxieties, it’s important to be aware if and when they exist.

VARIABLE #2: The Source of the Rumor and Their Level of Credibility

The credibility of the person starting or spreading a rumor is important and influential on the rumor’s overall spread and impact. Is this individual typically “in the know” as a respected and trustworthy member of the team? Or, are they out of loop, or prone to exaggeration or joking, making it unlikely their information is rooted in fact? If the person is high-credibility, there is a greater chance of the rumor spreading and being believed. However, if they are less credible more times than not their rumor won’t get far. Examining which rumors are believed by your team can help indicate which employees are most trusted by their peers. It can also help inform your response, whether you react to it or let the rumor die.

VARIABLE #3: Subject Matter Importance Not all rumors are created equal.

This is important to understand because rumors are more likely to circulate between employees who consider the subject of the rumor to be of high importance, or if they feel it will have a large impact on them personally. There may be rumors so minor or inconsequential they do not deserve a second thought. These benign rumors are a part of the natural discourse, and will blow over with time. Identifying which issues are most important to each individual employee can help you to keep your team focused on the most valuable aspects of the organization and its goals. It can also provide insight into what your team believes to be important. As a leader, you can then assess if things perceived as important actually are, and determine the best ways to help employees understand what is and isn't essential for overall success.

VARIABLE #4: Level of Ambiguity in the Environment

Rumors are inherently rooted in uncertainty, which can lead to misinterpretation of facts. The more ambiguous an environment, the more likely a rumor is to develop. When information is not shared clearly or there are gaps in understanding, feelings of frustration and confusion can lead to speculation - and employees filling in the blanks. If rumors are rooted in this lack of clarity, they have the ability to erode trust in leadership and contribute to an unpleasant and unproductive workplace. It is essential that leaders communicate in a way that is straightforward, honest and to-the-point. It’s also important to be predictable - this allows employees to anticipate and understand the ‘what’ and ‘why’ things are happening more easily.

Out of all four components, leaders have perhaps the most influence on the level of ambiguity in their team’s environment.

While some ambiguities simply cannot be eliminated, there are often ways to limit the ambiguity that exists in the workplace. Just because something is unknown does not mean the possibilities are endless, and in any given situation some outcomes are more predictable than others. Ask yourself how you can reduce or limit ambiguity for your team.
  • What are the unknowns the team faces?
  • Is your perspective different from what your employees can see?

According to Gallup’s State of the American Workplace Report, only 13% of employees strongly agree the leadership of their organization communicates effectively with the rest of the organization. 2

Help fill in as many blanks as you can, to leave less room for people to draw unrealistic conclusions.

Remote Environments Can Stoke Rumors

In the remote landscape, digital interactions may speed up the spreading of rumors. You should strive to have more frequent interactions with employees because even more transparency is necessary. During periods of uncertainty, staying more connected and engaged with colleagues is especially essential. Picking up the phone or sending an email can be the right ways to keep that connection when face-to-face is not possible.

How Great Leaders Address Rumors

Rumors are inevitably something you will have to address as a leader, and getting a grasp on these four components underlying rumors will help you to suss out when rumors are worthy of your attention. It also reveals a lot about your team - and about you as a leader.
Knowing what makes your employees anxious, who is credible when it comes to spreading rumors, and what is important to your employees will help you better understand why rumors crop up. While many of the variables may not be in your control, it is possible to at least mitigate most of them. Armed with this knowledge, you will be ready to focus on the rumors you need to, and to let the others fizzle out.
The best way for leaders to deal with rumors is by addressing them head on. Do what you can to reduce ambiguity in your workspace, and cultivate open lines of communication. Set the record straight by sharing as much as you are at liberty to share. Answering employee questions honestly will bring relief to those who have anxiety caused by misinformation or ambiguity they have been hearing and internalizing. Effective leaders will be able to address tough questions and concerns alongside their team. They create an environment where open dialogue is encouraged and welcomed.

Rumors fill in the blanks, so it’s best if those blanks are filled with facts.

Once you fully understand the causes of rumors, you can assess which are connected to things you can change. At the end of the day, knowing how you can influence these variables when it pertains to rumors will make it easier to deal with them.
[1] https://blog.hubspot.com/marketing/productivity-prohibitors
[2] https://www.gallup.com/workplace/238085/state-american-workplace-report-2017.aspx