How frank should our leaders be?

Last night I read Mohinish Sinha's article on leadership. It talks about a situation where leaders dont either see the bad picture (due to their own rosy glasses) or dont want to let it out in the open lest everyone else comes to know of it. He says "...Leaders, whose self concept is brittle, hesitate to call the truths lest they will be found out. ..."

However, as I see it, there is another side of the story. As he writes in the preceding line, " Organisations tend to mimic the behaviors of the leaders at the top." So a leader might want to shield the bad news from the employees - just to keep them motivated. This, however noble it appears, is not without its flaws. A leader has to be able to see the whole picture, and know the short-comings well. So even if the bad news is not let out in the open, it has to be dealt with - firmly.

HBS too had a similar article/ opinion poll sometime back. They talk about the National leaders during times of crisis. The question posed is if or how frank or deceptive should the leaders be during crisis. The leader showing negative sentiments is not a good sign and it tends to reduce the general morale. However no one wants a leader who lives in a cocoon of self-deception and believes that everything is fine.

As is reported elsewhere, about 70% communication happens via non-verbal means. So the self-deceptive will come out as more natural and more convincing while the one who understands realty will show some signs of distress. But human brain is pretty good at understanding cues from fellow human beings. We can understand if someone is in a slight distress and still very optimistic. Most people would trust such a person more than someone who shows no signs of crisis.