IF YOU HAVE employees in your small business (or even intend on doing so in the future) there are no doubt countless decisions surrounding this particular component of your operation. One facet of hiring, training and successfully managing employees is balancing the numerous processes in keeping them happy and productive. One such balancing act that will become imminent at some point will be with the level of transparency you establish and maintain with your workforce. The sharing of information with employees can, however, be a slippery slope of sorts if not administered with a solid plan and the right approach. 

Think about your company for a moment. Do you currently tell your employees everything that might be going on? Do you tell them nothing or do you provide information on only what you think they need to know? This is but one part of the equation. So, before any decisions on how to proceed are clearly defined, it is advisable to scrutinize the very reasons for transparency itself…and the risks it could carry regardless of how much or little is actually divulged. 

You’re the boss, right?

Early on, many small business owners may slant toward limiting the provision of information to their employees as a safeguard. How many times have you heard the phrase “they are on a need-to-know basis” before? I have heard that spouted off hundreds of times. The response from owners many times reflects the notion that they don’t want their staffers worrying about things not associated with their job description. Others entrepreneurs simply believe that there is no benefit in employees becoming distracted and ineffective. Obviously, certain things need to be kept confidential or streamlined for individual consumption, such as individual salaries, benefits, employee records, or anything human resources-related. This also goes for any sensitive corporate legal proceedings, private records and even some trade secrets. These areas of concern should always be relegated to only those to whom it pertains.

Employees, for the most part, want to feel proud of where they are employed and in showing pride in the type of work they produce as well. Keeping your employees in the dark by instituting a policy of secrecy regarding your company operations may hurt that goal for both sides. Inadequate information can result in operational and cultural dysfunction. Members of your team need adequate information to maximize their performance. That includes a sense of belonging to the organization to maintain positive morale.

The Potential Benefits of Transparency

What about the benefits that transparency can create? Let’s take a look at few other reasons why you may want to open up the flow of information to actually create a positive work environment:

Make transparency a resolution: Transparency keeps your best staffers from leaving.  Routinely providing news, updates and information about the company that employs them, its customers, and the current project you’ll be considering, can go a long way in making them continue to feel like a true part of a team environment; and also an integral part of the company itself.  Furthermore, sharing updates on new products and services, current priorities and future goals with your workforce can provide stability, confidence and focus across the board. Consistently communicating this information also helps build trust throughout the group. By implementing a certain level of transparency within an organization, you can make certain that your staffers have all the essential information.

Create a 2-way communication / feedback model: One would hope that the more feedback you can offer your employees, the more they will benefit. When employees can acknowledge their progress, or lack thereof; and then positively know where their current priorities may need to be, they will become more effective. The same goes the other way too. Receiving feedback from workers regarding your new products, customer service issues, pricing, and future project feasibility can be invaluable asset for an owner in rendering decisions on any of those initiatives. Transparency can be a huge difference-maker in this regard.

Prioritize company-wide collaboration:  Once your level of transparency is established and a feedback and communication model is implemented, a company-wide collaboration plan could also be part of the regular communication stream. When your workforce has a platform to candidly discuss goals and projects with owners and managers, creativeness and inventive concepts will flourish. This concept encourages employees to be proactive in solving problems themselves too. Reciprocating the process by sharing the progress of those new ideas or informing them when, where and how they may be utilized ensures the employees that their efforts are valued as a vital part of the organization’s success. Charts, graphs, reports or any other format you consider as the best method of tracking these efforts is just another form of transparency that reveals your willingness to collaborate on a joint effort level rather than just employer-employee basis.

Is There a Downside to All This?

Of course there can be, if you’re not careful. The biggest of mistake a small business owner could make here would be to use this new transparency approach as a “crisis management device.”   The last thing you will want is to scare your employees to death about anything negatively related to their employment status with you. As was mentioned at the top of this section, a balance needs to be decided upon in order to effectively launch this initiative. Truth is, bad news is actually acceptable here. In fact, it shows that your company (or any company for that matter) can be vulnerable to internal or external factors that could lead to trouble. 

Sharing this information carefully but with caution can show your employees that you are leading with confidence in tough times or with a tough situation. Getting everyone together for the sheer purpose of sounding an alarm is never the correct course of action. Conversely, tackling roadblocks in a collaborative effort can actually benefit everyone by forging a team environment in heading off the negatives that could be on the way. Remember, confidence rules over crisis every day.  

Caution: Be Mindful with This Decision

Finally, always temper bad news and information with the positives that surround you. Again, the balancing act comes into play again. A company full of solid employees who understand what’s at stake and are willing to work together to solve the problems in a positive environment is always better than the alternative. 

The lesson here is to figure out what course of action may be best suited to your organization’s business model and then subsequently, how much transparency would be appropriate for your company as a whole. Nevertheless, you must always be mindful that employees may assume the worst when they are not communicated with by their owners and/or leaders. Consistent silence is usually never the answer; as it can cause negative rumors, panic and even anger in some cases. None of these reactions contribute to a creative or productive work environment either. Therefore, do not take this project lightly; as it could the foundation of employee contentment, longevity and success.