A company that’s transparent with their employees and the public may be something worth looking out for on your job hunt. But why is transparency the key to financial success? Take a look…
These days, company culture is everything. Whether you’re a business looking to keep employees happy, or a job hunter looking to choose a company to work at, this will be an important factor.
Business transparency – in terms of company finances and decisions – is a crucial element of this culture. But how might a transparent company keep a business thriving financially?
There are lots of ways in which transparency helps a business achieve financial success. For example, being open and honest with employees about any debt the company is in can help it get out of debt and avoid suffering financial restraints such as a freezing order. In this post, we’re going to explain some of the ways in which business transparency is the key to financial success.
Why Should You Have a More Transparent Business?
Lots of businesses keep important information to themselves instead of sharing it with their employees and the general public. It’s understandable that a company would want to hide their secrets but, by sharing the load, they can actually be more profitable.
This not only encourages a business’ success, but also makes for a very desirable company to work for. Here are some of the ways transparency improves the financial success of businesses through this:
Increases Employee Engagement
A 2013 study in the Harvard Business Review showed that 70 percent of employees felt more engaged with their company when leadership gave them consistent updates on the organisation’s strategy.
Transparency fosters trust, which makes employees less anxious about how the business is going, makes them generally happier, and improves their productivity. This, therefore, would make any company more profitable. It also makes for a great place to work for any potential job hunters.
Gives Employees a Voice
As an employee, having a say in the company you work for may just be what you’re looking to keep you engaged and productive. Breaking away from knowledge-hoarding can also really help employees collaborate and solve company problems more effectively.
So, as a business owner, the more people you let in on how the company is doing and what the strategy is, the more chance you have of someone tweaking the strategy to make it better. Staff members may even have ideas on how to get the company out of debt and make it more profitable.
Helps You Recruit Better Employees
It’s not only your current employees that you can motivate with business transparency, you’ll also get the attention of good candidates.
Once you start being honest about your organisation’s finances, culture and salary ranges, job candidates might choose you over a company that keeps its business to itself. Also, the employees you do hire will be truly invested in your company’s mission statement, helping you achieve the financial success you’re aiming towards.
Most companies would agree that being blindsided by something they didn’t see coming can really damage their bottom line. When you include your employees in your operations, they’re much more likely to spot an issue like an unpaid debt nobody was aware of, than you would be on your own.
Even a simple issue can spiral out of control if it isn’t spotted in time. So, being transparent with your employees is essential to your company’s financial success.
Promotes an Organic Online Presence
Encouraging your employees to follow your company strategy, work harder and come up with innovative ideas is great. That said, you could extend your newfound transparency to the wider public.
One of the best ways to get the message out about your company is by using social media. Social media is quickly becoming one of the most prolific marketing tools, with companies in all industries turning to it for promotion.
Providing shareable information about how your products are made, where your employees are from, or how you help out your local community can really engage your customers with your company culture.
Once your customers start engaging with your culture, they’re much more likely to use you when they need whatever service you provide in the future. This, therefore, would make any company more financially sound.
Helps You Reinforce the Ideas in Your Head
When you know what your strategy is and you’re following it, it’s easy to stay on the tram lines and not think outside the box or be flexible in your approach.
Forcing yourself to be more transparent with your employees and the wider public means that you have to really boil down what the strategy is and let everyone know what their part in that strategy will be.
By putting it down into words and explaining it on a regular basis to other people you’ll solidify the strategy in your mind. Once this happens, you’ll begin to see problems with the strategy and think of ways to make it better and more financially viable. It also gives employees a chance to provide their own opinions too.
The main thing an investor wants to know about a company is how profitable it is. Usually, a company would have to pull together all their financial information and pitch it to investors to secure a financial investment.
However, if you’re already completely open about your finances and your business strategy you might actually get some investors coming to you. This is because they can see a money-making opportunity in your business.
When it comes to financial success, a large influx of cash from an enthusiastic investor isn’t a bad start.
Increases Your Overall Profitability
There have been a number of polls throughout the last decade that show at least 66 percent of consumers would spend more money buying from a transparent company. On top of that, 94 percent of them ranked transparency as the greatest factor in brand loyalty.
If these polls are anything close to the truth, then becoming a more transparent company can really give you a loyal customer base, who will spend more money with you, and come back to you time and time again.
Business Transparency for Financial Success is an All-Round Winner
In this post, we’ve shared some ways in which business transparency can improve the profitability and overall financial success of a company. We’ve also demonstrated why somewhere more transparent may be just what to look for on your job hunt, if this is up your street.
The main thing to take away from this article is that when you’re open, honest, and transparent it builds trust between you and anyone who chooses to do business with you. That means employees, investors, clients and partners.
When you build trust through genuine honesty and transparency it can only be a good thing for your business, inevitably leading to greater long-term financial success.