(The following is an excerpt from 10 Keys To Entrepreneurial Success From a Two-Time Entrepreneur Of The Year, a new ebook by Pat Sullivan)
In the same way everyone says they only hire “A” Players, companies love to talk a lot about transparency. The problem is, most fail to actually achieve it. Sadly, the only thing really transparent in most companies today is their utter lack of it. I’ve even heard people say things like, “For the most part, our company is pretty transparent,” but “pretty transparent” is like being “a little pregnant.” You either are or you’re not. And regardless of what you say, your investors, employees and customers know when they’re not being told everything. Simple rule of thumb, unless it’s a birthday party or an engagement ring, most people don’t like surprises.
At Jigsaw Health, my premium supplement company, we hold an open-book, company-wide monthly ops meeting. Everyone in the company is in attendance and we go over all the numbers – profit, loss, cash flow, analysis of key metrics – everything. Why? Because uniformed people can’t make informed decisions. Entrepreneurship requires being agile, the ability to move quickly, but you can’t expect, much less require people to effectively do their jobs without everyone knowing what’s actually going on. Lack of transparency is like giving your people an incomplete roadmap and expecting them to successfully navigate unknown and treacherous terrain.
Lack of Openness is a “Turrible” Idea
A good example of transparency comes from the later years at SalesLogix when we were trying to make a web product. It was good idea, but frankly, a bad execution. Really bad. The kind of bad Charles Barkley calls “turrible.” Around $20 million worth of “turrible,” to be exact. Luckily we were more than big enough at that point to deal with that costly of a mistake. We also could have easily whitewashed everything by simply not talking about it and moving on.
But people would have wondered, whether they talked about it or not, because a lack of transparency, clarity or closure breeds a lack of confidence. So we owned it. We acknowledged the failure, and guess what. Everyone simply stopped talking about it and went back to work.
Transparency translates to trust and respect, and in the end, happier employees. The opposite is also true. When you paint a rosier picture than is accurate, or you set expectations that can’t be realized, your people will become insecure and you will only be setting them up for disappointment and failure. In time, everything you say will become little more than pie-in-the-sky prattle, and a Pavlovian bell cuing people to your lack of leadership. You can only cry wolf so many times before people are no longer willing to follow you.
Justice Louis Brandeis once said, “Sunlight is the best disinfectant.” He was right. When it comes to transparency and your business, it’s always best to throw open the shutters and let the sunshine in.