Transparency in business: 5 ways to achieve it
As an entrepreneur in 2022, you’re held to a higher standard than ever before. The modern customer is better-informed; platforms like social media, discussion forums, and review sites make business transparency crucial to success.
Transparency in business is about being committed to building the best business venture possible. It’s about building trust—and showing that you care about your customers, investors, and employees just as much as you care about your business.
What defines transparency in business?
Business transparency is defined by openness, honesty, and straightforwardness about your company operations.
Transparent businesses share information with their customers, investors, and employees relating to: Being transparent about your business doesn’t apply to success alone: when something doesn’t go according to plan, transparent businesses are just as up-front about the issue as they are about their accomplishments.
Benefits of business transparency
Transparency can enhance a business’s reputation and success. According to a 2018 survey, 86% of Americans believe that being transparent is more important than ever before. In fact, the same survey also found that:
These numbers indicate that many consumers only want to support brands they can trust. Trust leads to brand loyalty, and this makes being transparent even more important—especially if you’re running a small business. If you can’t provide strong, clear communication and transparency to your customers, they’ll find another business that can.
Business transparency doesn’t only apply to your communication with customers and investors: it’s just as important to be open, honest, and straightforward with your employees.
A 2019 workplace trust survey found that when employees trust their employers, their advocacy, commitment, engagement, and loyalty all increase notably. In other words, to ensure that your employees are reliable, committed, and productive, you need to cultivate this attitude among them—and it all starts with business transparency.
Be transparent – but don’t give away too much
Transparency in business means that you should always be open and honest. However, there is such a thing as being too transparent.
Being transparent isn’t about sharing all information about your business all the time. It’s about honesty and authenticity. For example, disclosing the ingredients of your restaurant’s signature dish shows that you take pride in offering only quality ingredients to your guests.
However, sharing the exact recipe of that signature dish could give away trade secrets that would benefit your competitors. Business transparency is all about balance.
5 ways to achieve transparency in your business
Transparency in business doesn’t happen overnight. It’s a long-term effort that requires conscious work and commitment every day. However, the benefits of transparency are often worth the effort it takes to build.
Here are five ways to achieve it transparency in business:
Know your core values
Your core values are your company’s vision, mission, and principles. They inform your decision-making and guide you to create the best possible version of your business.
These core values should be communicated clearly to your employees to ensure that everyone is aligned around the same guiding philosophy and working toward a common goal.
Keep your employees informed
As just as you can be transparent with your customers without giving away too much, the same applies to your internal communications.
Being transparent with your employees means not only sharing information they need to be successful in their roles, but also the broad strategy and objectives they are helping you achieve. This increases their engagement and greatly enhances organizational culture. Keep them informed of new developments before the rumor mill starts churning.
Help your employees understand
- how your business functions;
- how their actions impact the business, and
- enough about what’s going on in your business to feel confident in their work.
Be transparent about your prices
In some industries, prices can vary depending on what’s included in the product or service offered. This is not necessarily an issue—but you should always disclose everything you can about your pricing.
Some businesses try to hide or manipulate their prices. In your quest for business transparency, this is a no-go. Never attempt to withhold information through confusing language or complicated pricing systems.
If your prices are higher than your competitors’, you can either:
- Be upfront about it and explain what's included in your pricing, or
- Consider lowering your prices to match those of your competitors.
Some companies aren’t comfortable being transparent and tend to beat around the bush when communicating with customers, investors, or employees. But transparency in business isn’t just about honesty: it’s also about getting to the point.
People prefer businesses that don’t hesitate to share information. Whether you’re raising your prices, updating investors on your financial situation, or revealing company changes to your employees, get to the point. Communicate clearly and leave nothing to interpretation.
Talk openly about your experiences
When it comes to sharing business experiences, you might think you should only talk about the good parts. However, being candid about your entrepreneurial experiences—good and bad—actually benefits both you and your audience.
Being transparent about your business experiences and owning up to the setbacks you’ve faced helps you learn from your mistakes. It also helps both current and future entrepreneurs, giving them hope and tips on how to weather the storms they may face.
It also humanizes you, which helps you connect with your customer base—particularly valuable for small-business owners. So talk openly about your business experiences and be transparent about your failures as well as your successes.
Show your strength of organization through business transparency
In the end, business transparency is about respect. Being transparent with your customers, investors, and employees shows that you respect and value them.
Balanced transparency in business can empower and engage your employees as well as strengthen your relationships with both customers and investors—without giving away any trade secrets. Test your organization’s transparency with the DecideAct software.