Transparency is one of those buzzwords people like to talk about but don’t necessarily like to implement. Frankly, I’m not surprised by that.
Like everything else this is a choice. There is a certain amount of courage that is needed to be transparent. It feels like sharing your secrets with people and waiting to be judged which can be uncomfortable.
If that’s the way you look at it, you won’t transparent. In fact, it’s more likely that you will be less transparent.
Many of the events that I’ve watched unfold this year have reminded me the importance of transparency. There are many examples of a lack transparency which have helped create problems too numerous to go over here.
However, the bottom line is transparency isn’t just a tactic that you employ. It’s a mindset.
What Is Transparency?
I think a fair question is, “What is transparency?”
I’ve never really heard transparency defined. Like other words or phrases, many times people talk about but they don’t say what it is or at least, what they think it is. We hear the word and we fill in a definition in our head. Before we get too deep into the discussion let’s define it.
I went to Merriam-Webster and found the following:
1: the quality or state of being transparent 2: something transparent especially: a picture (as on film) viewed by light shining through it or by projection
Being that this is a blog that discusses digital marketing and public relations, neither of those definitions is particularly helpful.
Marketing and PR are business processes so I googled “business transparency”. I found several definitions but I liked this one on the Forbes site best:
- Business transparency is the process of being open, honest, and straightforward about various company operations. Transparent companies share information relating to performance, small business revenue, internal processes, sourcing, pricing, and business values.
This pretty straightforward. The first sentence of the definition speaks to internal transparency while the second sentence speaks to external transparency.
What this definition doesn’t say but does allude to is trust.
Transparency Builds Trust
From a business perspective, you need people to trust you.
Internally it’s your employees. Externally, it’s your prospects, customers, and the media.
If your employees don’t trust you there is likely to be low morale high turnover.
If your prospects or customers don’t trust you, they won’t buy from you.
If the media doesn’t trust they are likely to simply ignore you or even worse, write unflattering articles about you.
How does transparency fit into this?
When you’re transparent you share information. You’re honest honest and straightforward.
In 2005 I was working at Intel. When it missed its projected earnings for the third quarter in a row, it was announced that there was going to be a company-wide audit to find savings. No stone was to be left unturned. We were told every process, project, and job would be on the line.
I’m not going to lie to you. The announcement was a little unnerving. The audit went on for the next six months. I knew I could be out of a job, but oddly, I wasn’t stressed about it. There was a certain peace in knowing what was happening. What would have been worse would have been to feel like I was on a sinking ship and nobody would acknowledge it.
It’s a lesson I’ve remembered and try to apply it in my business dealings. I want people to feel like I care about their business as much as they do and this means I work to be as transparent as I can. Sometimes this means telling somebody that I’m not the right fit for them and referring them to somebody else.
Just as transparency will breed trust the opposite is also true. A lack of transparency will breed distrust
Imagine that you are interested in a piece of software that will help you automate your marketing. You go to a company’s website and all you can find are vague claims about how it will improve results without proof. They tell you that they are better than their competitors but don’t tell you how. The only information on pricing is to call and speak to a sales representative.
Would you call? If you do, you’re braver than I am because there is no way I would. The fact that they are being so opaque is a giant red flag that screams at me to run for the hills.
Your marketing and public relations efforts are a step in creating a relationship and trust issues ruin relationships.
Why Transparency is Important in Leadership
Trust is an essential part of leadership. It doesn’t matter whether you are a manager or the CEO. If people don’t trust you, life is going to be difficult.
COVID-19 and its impact has impacted everybody. It’s been a test to every leader and some have done better than others.
I first saw Wil Reynolds, founder at Seer Interactive, speak at MozCon a few months ago. He’s really smart but the thing that really stood out to me about him was that he was a no BS kind of guy. I listened to a podcast he was on and he talked about how he, in what some might consider a radical act, shared with his employees how much money the company had in the bank.
He was under no obligation to do this but he recognized that his employees were concerned about their jobs and took this action to help to alleviate some of their unease.
What if he would have taken a different approach such as saying nothing about the cash they had on hand and the status of everybody’s job?
Which situation would rather be in?
They say ignorance is bliss but it’s much different when the world feels like it is burning around you.
It would be easy for me to say this is where a leader needs to transparent but it’s not just in this moment. It’s all the time.
Leaders set the tone for the company and being transparent builds the kind of trust that is important in good times but especially in bad times.
Why Transparency Is Important In Business
Intel had roughly 110,000 employees when I was working there. One of the reasons I liked working at Intel is that it was transparent with its employees.
When Paul Ottellini became CEO he started a blog against the advice of Legal. This led to other executives starting blogs as well. The amount of information that I knew about the company increased substantially.
Paul (we always called people by their first names at Intel regardless of their job title) did more town hall events with employees than his predecessor.
Intel also had a program called “Write To Know” where employees could submit questions that would be addressed by the appropriate person inside the company which included the CEO.
Every quarter we had a meeting to talk about the most recent earnings news. In this meeting, they would tell us about what was going on within the company such as projects and their status. Finally, they would talk about what was happening with our site and answer questions.
I’ve never worked for a company like this before or since. I felt like I had a status that few people in the world would be able to enjoy. I was an Intel employee. They earned my trust through transparency.
The level of transparency changes when it comes to those external to your company but it’s just as important.
Concern about the environment has grown over the years so if you’re making a product, sourcing has become a key issue. Whether you provide this information can be a factor if people will do business with you or not.
Not every business sells goods. Many, like my own, sell services. If you are selling servicing are you including pricing information?
In some situations, you may not be able to gIve any pricing information because it’s determined by the scope of work. In those situations are explaining why you’re not giving out pricing information?
Healthcare has become a lightning rod for transparency. Often people don’t even know what the cost of the healthcare services they receive are until they get a bill or an explanation of benefits from the insurance company. This can create a surprise situation which isn’t good.
The more information you can give proactively, the more you will build trust.
Transparency Isn’t Easy
Transparency seems like it should be easy but it’s not. It can be hard. If you’re not used to being transparent it’s not like you are going to be able to flip a switch.
Sharing more information can make you feel vulnerable to your employees and your customers.
Earlier I talked about how several executives, including the CEO of Intel, starting internal blogs. Legal advised against it because they were concerned about internal information being made public.
A couple of years later as Apple was transitioning to Intel chips I was on a site dedicated to Apple rumors. It had a rumor about the working relationship between Apple and Intel. It was high level and incomplete but I knew what they had was true. How? It was information that was shared with Intel employees.
Was the information leaked by an Intel employee? It’s possible but it’s also likely that it could have been leaked by an Apple employee.
The leak itself wasn’t a big deal because the information wasn’t sensitive. You might be thinking right now, “Who cares about how Intel and Apple were working together.”
You might also be thinking, “This is proof that I need to hold my cards close to my vest because my employees will leak information.”
I would argue that would be a mistake.
In this situation, Apple moving to Intel chips wasn’t a huge boon to the bottom line but it was a really big deal.
Intel had been chasing Apple for years. I remember Paul Otellini stating during a town hall that Intel had to do everything it could to make sure that this was a successful transition for Apple. He said, “They are literally betting their company on us. We can’t let them down.”
Intel didn’t have to share this information with us. It certainly didn’t help me do my job better but it did make me feel like I was invested in the company and its direction.
If you have a business you obviously can’t share everything. I’m not advocating that you release your strategic marketing plan or your intellectual property to the world.
I am advocating that you be as transparent as possible to create trust.
It will be the difference between success and failure.