Transparency. It is a term we hear all the time, but what does it truly mean and why does it matter to your business?
What It Really Means
These days, we hear a lot about the importance of transparency, especially in politics and business. But just as with so many other terms, after overuse, it is reduced to jargon and begins to lose its meaning.
“Transparency is much more than a buzzword – it's a critical component to a company’s success.” (Social Media Today).
A quick look at the Oxford English Dictionary reminds us that transparency is “the condition of being transparent,” which is defined as “obvious or evident.” But why does that matter?
Essentially, being transparent equates to being truthful; that you are running an upstanding business and have nothing to hide.
When you are transparent, you cultivate trust. This applies not only to your public persona, but also within your organization. Are you honest with your employees and staff or does the upper echelon operate under a shroud of secrecy?
Companies who are open and honest with staff have happier employees and more success. You can communicate with your employees in myriad ways—from the more traditional email and newsletters to the modern intranet platforms and social communities. Not only does transparency create a culture of trust, but it also leads to motivated, empowered, and loyal employees.
Stepping outside of your internal operations, consider how your business methodology affects your clients. Just as with your employees, customers want to deal with a respectable, reputable business, driven by transparent practices. Public perception is directly related to how transparent you are.
Generally speaking, people have good instincts and if they feel that an enterprise is hiding something, they will take their businesses elsewhere. Now, you may, in fact, have nothing to hide, but if it is perceived that you are trying to hide something, customers will suspect something.
We are not talking about releasing trade secrets here, but rather we are suggesting that you are honest about how you do business, what your goals are, what you provide and how you can help customers, especially if you are an online business. Buyers are more likely to purchase from you if are transparent about your sales techniques—how you got their name, why/if you track previous purchase, and how that affects recommendations and offers. Speaking of online…
Let’s face it, these days, you can find out almost anything you want about a person or company online. While this has many benefits, it can be detrimental to businesses who are not already practicing transparency. If you try to hide or cover up information, only to have it come out publicly, it will damage your public image. Although this is not a new concept, information travels quickly and easily thanks to social sharing.
“The internet is making any information more available, so embracing transparency represents a fundamental understanding of how the world is changing, which can only improve how you adapt, transform, market and sell to your customers.” (Glassdoor). It is inevitable, so stop fighting an uphill battle that you are likely to lose.
Perception is Truth
When we break it down, transparency is directly related to perception and accountability. Do people perceive you are trustworthy or do you seem like you are trying to hide something?
Transparency is a way for the public to hold businesses and government organizations accountable for their actions and practices, especially in the face of crisis. How many time have we seen a scandal break, only to have a company’s attempt to cover it up backfire in their face? The cover-up attempt typically damages reputations more than the initial disgrace. (I’m looking at you, Ryan Lochte!)
Transparency, in the form of honestly and accepting responsibility, will go much further towards building trust than anything else your business does.