How Business Transparency Can Help Your Business Excel
Transparency is critical for businesses today. Years ago, how a business managed its operations behind closed doors was hidden from the public. Today, company culture plays a huge role in the overall scheme of things, and maintaining company transparency is key to a great culture. Whether you’re running a limited liability company, a two-man startup, or a corporation, transparency is key.
Take a look at some of today’s thriving companies, and you’ll notice that more and more businesses are talking openly about their hiring processes, revenue, and diversion efforts. They’re starting blogs to create a dialogue around their internal process, speaking openly at events, and hosting company-wide staff meetings to keep everyone included.
Companies like Buffer have an entire page dedicated to detailing their transparency. Yet many business owners are worrisome about transparency, believing that revealing too much about what’s happening in their companies exposes them to vulnerabilities. But this couldn’t be further from the truth. Rarely do transparent companies find themselves in troublesome situations, and there’s a reason for this. Here’s how transparency can help your company grow:
Customer retention is less expensive than customer acquisition. Once you have a customer, your goal should be to keep them. Transparency helps you achieve this. This is especially true if you make mistakes as a business—particularly during early stages. Perhaps you underestimated how many orders you’d get and now dozens of people must wait until new product can be manufactured. Or maybe an employee made an internal mistake that compromised customer data.
Whatever the case, honesty and transparency go a long way towards keeping customers—whether you’ve made a mistake or not. One study found that 85% of customers would stick with a company through a brand crisis if the company was transparent about what happened.
Get More Feedback
Getting honest feedback for your business can be troublesome, whether you’re soliciting feedback from your staff or from your customers. When you run your company culture with transparency, you get the same in return for your feedback. And as you know, feedback is so important for growth. It keeps you inspired and gives you a sense of purpose.
It also helps point you in the right direction; far too often, business owners make decisions that don’t factor in the valuable opinions of the people that matter the most to their bottom line. The right feedback can unlock innovation and change, sparking new ideas that help the company continue to succeed. And when you listen to feedback and actively pivot or adjust to accommodate it, it shows exactly how much you care.
Increases Your Profit
According to the Label Insight Transparency ROI Study, 94% of customers are likely to remain loyal to a brand that’s transparent. And three out of four consumers would be willing to pay more for products or services offered by brands that are more transparent. It’s not just consumers that will help your business improve profits, either. When you’re transparent with your staff, it makes it easier for them to come up with great, profit-generating ideas. In order for your team members to make decisions like you, they should have access to the same information as you.
Your Staff Will Be Happier
When your staff is happy, work gets done. Your team feels better about coming to work each day, and are proud to be working under a transparent management team. Several studies have demonstrated that company transparency was the number one indicator of workplace happiness. When you’re transparent with your team, you’re able to build trust and foster meaningful relationships. Whether you’re sharing company revenue numbers or having company-wide weekly meetings to ensure all departments know what’s happening across various teams, it goes a long way towards creating happiness necessary for long-term goals to be met.
Set Realistic Goals
If your business has a top-down approach to management, it can be difficult to set realistic goals. This is because if you don’t understand what’s happening at the bottom, it becomes difficult for you to relate to them. And people at the bottom—say, customer service representatives, for example—may not feel comfortable arguing against unrealistic metrics.
This is exactly what happened at Wells Fargo, when hundreds of employees created fake accounts to reach unrealistic benchmarks. When you encourage team members to share information candidly across your organization, it gives you a more in-depth understanding at what’s happening at every level of your company. Ultimately, this allows you to set more realistic goals that don’t pressure or stress your team.