Transparency is an essential component of any successful business relationship. According to a survey by Label Insight, 94 percent of consumers surveyed are likely to be loyal to a brand that offers complete transparency. And of those surveyed, almost 75 percent of consumers say they would pay more for a product when the company offers complete transparency.
But what does it really mean to be a transparent business? Transparency means being honest when it comes to sharing negative news, financial reports, and plans for the future, both internally and externally.
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Here’s a deeper look into how transparency can transform your startup
It’s a great marketing strategy
Marketing your startup as a transparent company is a great way to attract potential investors, prospective employees and customers. But avoid making promises you cannot deliver on. If you build your company culture and branding around transparency, make sure to live up to it.
It impacts your bottom line
Transparency can have a significant impact on your company’s performance. When you’re open about important aspects and goals of your company with your employees, they’ll become more engaged with their work, since they know what the end goal is. A report from Gallup found that companies with an actively engaged workforce experience less absenteeism and turnover, better customer scores and higher profitability.
It sets the right expectations
In today’s competitive job market, many candidates expect startups to be transparent about essential aspects of the organization, like office culture and business practices. This can help you hire and retain the best talent. Many candidates look at the culture of a potential workplace to help them decide whether or not they want to join a company.
So, how do you establish transparency internally?
Here are some ways you can get started in implementing transparency within your startup:
Establish a flat organizational structure
A flat organization means there are few or no levels of management between you and your employees. In a startup, it’s often expected for team members to wear many hats, enabling everyone to share information and be more involved in various roles. This kind of structure encourages involvement in the decision-making process and improves transparency.
Share financial reports
Sharing financial reports such as forecasts, profit or loss statements and company performance feedback with employees can improve engagement and productivity. By sharing this kind of information, employees will have more appreciation of their role in the business. They’ll also be able to understand the company’s current status, what can be improved on, and what can be avoided to encourage growth.
Be honest and acknowledge your mistakes
We tend to be more vocal or open about something that’s positive, but when it comes to negative news, we usually keep it to ourselves. But to truly implement transparency, you need to be honest about the negative aspects of the business, as well. This is an essential ingredient in building trust within your organization.
All good leaders need to acknowledge their mistakes. This is vital in helping to build trust within your organization. It’s essential to openly recognize that you did something wrong in order to learn from the situation. This will set the example for your employees that it’s acceptable to make errors every now and then. When employees aren’t afraid to make mistakes, this can lead to more innovative ideas.
And how do you establish transparency externally?
A lot of the above tips can also be applied to establishing transparency with your customers or clients. What it all essentially boils down to is communication.
A major factor in establishing customer trust and transparency includes pricing. You’re guaranteed to have dissatisfied customers if have hidden fees and loopholes are a part of your purchasing process. Your customers expect you to be upfront and honest about what they’re getting for their money.
Responding quickly is essential. If a customer has questions, make sure you respond as soon as possible. For young startups, you may think you’re without the manpower yet to get to every email and phone call as quickly as you should, but that’s where chatbots and automated email marketing come in.
Listen to their feedback
It’s important that your customers understand that you value their feedback, whether it’s positive or negative. Make sure you’re constantly reviewing your company’s online reviews. Respond to every comment in a professional manner, and don’t ever come off as argumentative, even if you disagree with the feedback.
The key takeaway
Transparency should be considered a priority within your organization. Understand that being transparent is not the finish line, but rather an ongoing process. Even small changes within your business can do wonders toward your end goal.
When you and your employees are open and honest with each other, and you extend that to your customer base, you’ll see a significant impact on business growth and on your internal processes.