John McKee was senior vice president and general manager of DirecTV when the company purchased PrimeStar satellite service. So of course employees fretted over possible layoffs since departments were consolidating. In response, McKee posted Ask John, an e-mail box where employees could submit questions with anonymity. The more answers McKee publicly posted, the more he gained credibility for straight talk, and the more employees trusted him enough to stop him in the hallway for information.

In uncertain times, employees who lack open communication with a company’s leadership will rev up the gossip mill—often to the detriment of morale and cohesiveness. “People in this economy are very concerned about ‘what’s going to happen to me?’” McKee says. “The smart leader or manager addresses it head on.”

Today McKee is president of BusinessSuccessCoach.net, based in Thousand Oaks, Calif., with an impressive client roster that includes Disney, Hewlett Packard, NBC Universal and Bank of America. He’s also author of Career Wisdom–101 Proven Strategies to Ensure Career Success and 21 Ways Women in Management Shoot Themselves in the Foot.

Since office politics are inescapable, companies need to make sure that the gossip pipeline works in the company’s favor, McKee says. Employees who are in the loop will look out for company interests and offer creative solutions. “It’s all about communicating a great deal,” he says. “Imagine if all that office politics was bubbling up to the owner. You may be surprised by the wisdom you are surrounded by.”

Communication Tips:

Ask open-ended questions. Managers should walk the floors asking employees, “What’s on your mind?” “What’s the biggest obstacle that you’re facing right now?” or “How can I help?” “If a boss, leader or supervisor is asking questions, they will ferret out the real things people are thinking about,” McKee says. “Many small business owners think they know what’s going on, but they don’t know all of it.”

Communicate your vision, and review constantly. “Share your vision, the obstacles you see, and how to overcome them. Ask your employees if they see flaws,” McKee says. An owner may even gain valuable insight by asking, “What’s the stupidest thing we’re doing right now?” Over the course of conversations, reiterate the long-term plan and strategies. “Get buy-in. Make sure they understand you believe it’s important. Prove to them that what you’re saying, you honestly believe,” McKee says.

Disclose as much as possible. Other than proprietary trade secrets, “I’m not sure there’s anything a small business has to keep a secret,” McKee says. Direct, upfront communication with staff is possible, and McKee has seen small companies that operate with such openness grow very large. Even an owner who is in a credit crunch and may not make payroll can share the news and tell employees what the plan is. Most employees will stay on as long as possible, McKee says, but “If you’re worried about the employee who will jackrabbit out, have a one-on-one conversation. “

Don’t hide bad news. “If you’re talking and only giving them a partial message, you’ve lost a lot of credibility,” McKee says. “People understand that businesses can disappear and that economies take control away from the leaders, but they resent being kept in the dark. If that occurs, the best ones will flee for greener pastures, leaving behind the ones who can't get jobs elsewhere.”

Get informal power brokers on your side. “They don’t have a title, but they have this way of encouraging people to cluster around their desk and ask them in the hallway what’s going on,” says McKee. He recommends face-to-face communication to find out what the power brokers are thinking and to enlist their support.