When you’re pouring 40, 50, or even 60 hours into a company every week, would you prefer to know what’s going on behind the scenes? Or would you be okay with being left in the dark and being told what to do?
Assuming you care about the future of said company, odds are you’d much rather be kept up to date on what’s going on. That way, you would know where the organization was headed and you’d have a chance to offer your insights into your idea of the best path forward.
While companies of yore were secretive, many of today’s organizations are building transparency into their operations from the ground up. The reasoning is simple: the more company-specific information employees are privy too, the more connected to and involved with their companies they will become. In theory, this will result in increased engagement and productivity as employees have a bigger stake in the success of their organizations.
No, this doesn’t mean you should share everything with your employees. If there’s an HR dispute between two coworkers, you’re better off leaving it private. But while companies have traditionally been quiet about their financials, the reasoning behind their business decisions, and salary information, businesses are increasingly choosing the share this information with their staffs. Here’s why:
Transparency About Finances
Sharing financial information with employees increases accountability and accelerates productivity. All employees understand where the company stands at any given point in time.
Let’s say business has been going well for a while. But all of a sudden, sales dip because of an unexpected reaction to a new product roll out. Understanding that their company needs money to keep its doors open, the sales team will start working harder to improve the numbers.
On the flip side, if business is through the roof, employees will be encouraged to be part of something great. They’ll work hard to grow the company because they’ll want to keep their jobs.
Transparency About Salaries
Tons of companies don’t allow their employees to share salary information with one another. But as a study by Tel Aviv University notes, studies have shown that employees who understand how salaries are determined are likely to work harder and increase their performance.
It makes sense when you think about it: they no longer have to worry about being tremendously underpaid and they know which metrics determine salary bumps. Since everyone could always use a little more money, employees will almost always strive to surpass any metrics. Beyond that, Fortune says salary transparency can prevent people from quitting.
If you’ve typically been quiet about private company information, you may want to reconsider your approach and start looping your employees into more conversations. That way, they’ll know how strong your company is doing from a financial perspective. They won’t feel as though they’re being paid unfairly. And perhaps most importantly, you’ll be able to tap into a whole new set of minds that will help your company make better decisions.
Transparency About Business Decisions
We’ve all worked at companies that tragically about-faced overnight without any rhyme or reason. Maybe they launched new initiatives that seemed doomed to failure right from the get-go. Maybe they restructured a department without roping the folks working in the trenches into the conversation. Maybe they chose to make a big purchase even though it is evident shortly thereafter the wrong decision was made.
Whatever the case may be, such unannounced shifts aren’t usually inspiring. And in many cases, they end up being the wrong moves.
When you share your rationale behind making any decisions and allow your employees to chime in on your ideas, you reduce the chances you’ll do something you wish you could take back.