Today’s business leaders are being motivated to create greater transparency especially in terms of the pricing of their products and services as well as the quality of their establishments. For example, customer reviews have become a pivotal point in a buyer’s shopping experience whether they are searching for a hotel for the night or looking to buy a tablet. Essentially, business transparency is a vital part of ensuring success and a satisfied customer base.
However, it may be somewhat confusing to accurately define business transparency. Below we discuss the definition of this term and what it is so important for your company.
What is Business Transparency?
You will find that transparency in business mandates entrepreneurs and leaders to be open and informative about a variety of topics such as company goals, performance results, product value, and general business operations, according to an article from Entrepreneur.
Transparency often relates directly to your customer base. For instance, a survey from Label Insight found that:
- 94 percent of respondents said they were more likely to become a loyal customer if a company offered transparency
- 73 percent stated that they would pay more for a product if the business maintained complete transparency.
However, when defining business transparency, it must move beyond openness with only the customer. Internal transparency must also be accounted for, which entails communicating fully with employees and providing complete information about the company’s operations. This type of transparency is known to boost employee morale, which should improve productivity throughout the company.
Both external and internal business transparency builds trust, which will ensure that employees, stakeholders, and customers have more faith in your company and continue to remain devoted. As such, there will be less turnover on the employment side and a stronger customer base that keeps coming back.
Now that we have a better understanding of what transparency means in terms of running a business, we need to discern why business transparency is so important for the success of your company.
Why Transparency Matters for Your Company
First off all, it is vital for your business to compete well within its market. More and more companies have now embraced transparency, which means you’ll need to incorporate it in your practice as well. For instance, Whole Foods now documents how it procures its food and the company Patagonia has seized onto supply-chain transparency.
Business transparency is important and will matter for the success of your company because it is so vital for your customer base as well as your employees. Being more revealing about prices, quality, wait times, and more will show that your company has nothing to hide and will build trust. This also helps customers make informed and smarter decisions in terms of their spending habits.
Essentially, businesses that reveal information such as all of the data behind its supply chain will tend to gain more loyal customers when compared to a company that doesn’t share its information.
Business transparency is also important for your organization because there is a general distrust of corporations growing among the American population. For instance, one survey found that only 36 percent of American residents stated believing that corporations are a “source of hope.” This may be due to the economic crash that took place more than a decade ago due to deceptive and secretive banks as well as the Occupy Wall Street movement that came about afterward, according to the Entrepreneur article.
However, if you establish greater transparency, your customers will be more trustful of your intentions and will not worry that you may be taking advantage. This can help you build a loyal customer base that keeps coming back to your brand.
Now that we have covered the importance of creating business transparency and why it matters for your organization’s success, it is useful to consider the myriad of ways you can make your business more transparent.
How to Build Transparency at Your Establishment
You can build more transparency by:
- Utilizing social media
- Embracing customer reviews
- Providing more information online
- Recording company meetings on video
- Providing workers with access to planning documentation
One key step in building an openness at your company is to become more visible on social media. Today, 88 percent of companies are using social media to engage with their customer base. As such, you’ll want to do the same in order to compete within your industry and become more readily available to your customers.
In addition, if you have any new developments including negative results, you will want to be more proactive and send out press releases using social media before any information gets leaked.
Another way to build greater business transparency is to include sections on your website or your Amazon page for customers to leave reviews. You can also put your company’s information on a website like Yelp where consumers discuss their opinions on products or services. Providing transparency through these websites will let buyers understand the quality of your products, your company operations, and the type of customer experience they will face.
Essentially, you can create more openness at your company by embracing the tools available in the Information Age. Today, consumers expect to get the information they’re seeking instantaneously. If someone wants to know a detailed description of a movie or book they’re considering purchasing, they can find that information within seconds of perusing the Internet.
If a customer wants to know the menu of their favorite restaurant, they can find that online as well. This wealth of information puts expectations on companies to become more open and provide as many facts as possible.
There are specific steps businesses can take to build internal transparency as well. Business activities can be more easily monitored due to new technologies, according to a report from McKinsey & Company. For instance, word-for-word logs in a customer service call center can be monitored. Real-time GPS tracking of supplies and deliveries can also be incorporated within a company.
Some companies record meetings via video so all employees across the organization can see what went on. Other businesses have enabled workers to view planning documentation and become part of the strategy-making process.
Now that many of the steps necessary to build business transparency have been covered, it is imperative to discuss the benefits of incorporating openness throughout your organizations.
The Benefits of Business Transparency
A major benefit of increasing transparency includes ensuring both company leaders and their customers make smarter decisions and, thereby, increase the profits of the organization. As mentioned previously, another significant advantage of transparency is its ability to build trust among the customers and ensure their loyalty for years to come
According to the Houston Chronicle, transparency also benefits your organization by providing an avenue to quickly respond to controversial issues if they arise. Another advantage is the greater respect your company will receive if you provide openness about how your business operates and all relevant processes. Employees and stakeholders as well as consumers will have greater respect for your brand.
Companies also benefit from a positive public perception the more open their executives and leaders are about business operations. Open communication lines within a public relations department will help shape better public perception. Business leaders can show integrity by being more up-front instead of attempting to twist corporate information into a more favorable discussion.
You will also build loyalty among your team members and other staff if you improve transparency. Employee morale and job satisfaction will increase if you involve workers in crafting company goals and objectives.
Your customer service reviews will also become more positive the more you make business operations transparent. Customers are more likely to maintain loyalty when a manufacturer admits any flaws or defects and takes steps to fix the problem. A public apology for a mistake will help customers appreciate their honesty and their attempt to repair any flaws.
If you want to experience these benefits in your business, you will need to follow key steps for improving transparency and adopt the right technologies to make your company more open. Project management software can greatly improve your internal transparency among employees.
How Project Management Software Boosts Business Transparency
You will find that Runrun.it project management software will help make your company more transparent if you adopt this product. For example, Runrun.it software comes with digital dashboards as well as a centralized information system to boost transparency.
A digital dashboard will also help managers and employees by providing single snapshots that include marketing and operational metric data along with performance metrics through a visual management practice. Including these type of results will greatly improve internal transparency at your organization.
In fact, measuring and tracking OKR or “objective and key results” using a project management software product can help a company launch their top goals and initiatives. Having the ability to monitor the results of top objectives (OKR) helps employees cooperate and work together to boost productivity.