In an age where there are high-tech solutions for virtually every problem, many small businesses lose sight of one of the simplest tools in their toolbox: transparency. While larger competitors are often hamstrung by highly tiered and secretive corporate cultures, agile businesses can use openness to their advantage, nurturing creativity and earning employee satisfaction and consumer confidence.
This culture of transparency spurs innovation and drives employee initiative, offering companies a competitive advantage.
Why Transparency Matters
According to Natalie Foley, vice president of Peer Insight, a consulting firm that helps companies grow and innovate, transparency is critical to a business’s ability to build trust and foster morale.
“There are functional needs and emotional needs in any business model. And we all act more often on emotional than functional needs,” she says. “An open culture nourishes those emotional needs and resonates with both employees and consumers. It establishes a base of trust.”
Foley believes that transparency fosters the functional side of the equation as well. By openly spelling out revenue and growth goals, for example, business owners help employees understand exactly what they’re working for, and how to fine-tune their individual efforts towards those outcomes. This communication boosts both morale and productivity—staff members feel like integral parts of the organization, and they can adjust their work priorities to focus on the most important goals.
Transparency as a Project
Despite the best of intentions, though, efforts to keep communication flowing sometimes take a backseat to the day-to-day focus of doing business. To avoid this, make transparency more than an ideal to aspire to. Make it a project.
- Assign a champion.
Every project needs a project manager (PM). Make someone responsible by putting the development and execution of transparency into someone’s workflow. Then staff the project, creating a cross-departmental team to ensure everyone’s interests are represented.
“Finding the right person is important,” says Foley. “A high-profile champion looks good, but a PM further down the chain might have more time and energy to invest.”
- Fund it.
Initiatives need budgets. Not only will this help move the project forward in tangible ways, but putting money behind it also lends a deeper credibility to your efforts. “Funding the transparency effort shows that you value it,” says Foley. “It’s a clear investment in your business and in your people.”
- Define it.
Foley recommends establishing a baseline. Survey employees on the frequency, quality, and integrity of company communications. This will give you something to measure against as you initiate change. She suggests getting granular with your data.
“It’s important to know what specific areas need the most improvement. Team-level transparency might be in line with your goals, whereas C-level communication might be lacking.”
Roll it out. Have actionable ideas to present to stakeholders. The original team doesn’t have to be responsible for every piece of the plan, but they do need to provide a roadmap for making transparency a reality. Foley recommends making the plan instantly available across the company.
“Allow everyone to share ideas—and files—right from the start,” she says. “It’s never too soon to open up about the plan—show everyone you’re serious about it.”
- Hold the plan accountable. Once the plan has been in place for a few quarters, revisit those baseline measurements. Is it working? If not, why? New surveys should ask about specifics of the transparency project. Use the new data to inform your efforts moving forward.
“You have to be okay with following employee voices throughout the process,” Foley adds. “Helping them feel heard—and being open with them—will pay off.”
An atmosphere of trust goes a long way toward creating long-term loyalty and improving worker efficiency, but SMBs that embrace this culture should also see greater growth and profits. According to research by The Great Game of Business, a management consulting and education organization founded by famed business strategist Jack Stack, businesses that use an open-book management style experience up to 11 percent more growth per year when compared to non-open book companies. Transparency might feel difficult to implement at first—but for SMBs it pays to make the investment.