Original Publication: Forbes
Date Published: January 31, 2019
We’re all aware of the importance of transparency in marketing, especially when targeting younger demographics. People want to align not only with your company’s brand, but also your ethos and mission. Lately, the conversation about transparency has turned inward, with some agencies giving their team members full disclosure of the company’s financial well-being, such as revenue, profit and loss, and so on.
We asked 13 members of Forbes Agency Council to share their own transparency experiences, including if they have taken the transparency approach and are still implementing it or if they implemented it and then chose to stop. Read on for the pros and cons of how in-house transparency impacted their business and culture below.
1. There’s No Reason To Hide Profit
“Transparency” is too often a buzzword agencies say, but don’t honor. We are an open book. Every budget we send to clients has a line that says “Agency Profit.” Not only does our team have full disclosure on what we make, but so do our clients. There isn’t a business in the world that doesn’t exist to make money, so why hide it from anyone? Our clients love it, and our employees love it. There’s nothing to hide. – Lucas Miller, Shop Marketing and Creative Group
2. Open Communication Informs Better Decisions
We have found it important to provide a certain level of transparency to our employees when it comes to our financial success. We set targets at the beginning of the year, communicate them broadly to the employee base and then provide updates on a quarterly basis. This helps get everyone focused on owning the year with us and making decisions in the business from an informed perspective. – Chris Cavanaugh, Freeman
3. Careful Consideration Is Needed
We have yet to implement this, but we’re thinking about it. Younger professionals appreciate openness and function better knowing how they fit into the business model. If finances are tight, the concern is that it may cause panic among good employees to jump ship. However, if profit is strong then it is easier for employees to understand their value and how they fit into that success. – Katie Schibler Conn, KSA Marketing + Partnerships
4. Share What The Team Will Benefit From Knowing
We have practiced pretty radical transparency with our finances at times in the past. The result is that team members, particularly younger ones with less work experience, totally freaked out. It added stress to their lives. I’m the business owner, so I’m expected to lose sleep sometimes, but not everyone needs to join me. Now I just let them know what they need to know so there are no surprises. – Scott Baradell, Idea Grove
5. Transparency Fosters Trust
Prioritizing transparency and integrity internally leads to growth, both because customers see they can trust you to help grow their business, but also because it leads to more engaged, productive and effective employees. We share our financial goals and progress monthly so that our entire team can rally around them. When everyone is aware, involved and invested it leads to success. – Mary Ann O’Brien, OBI Creative
6. Sharing Finances Means Sharing Impact
In 2018 we transitioned to greater financial transparency. We shared revenue and profitability goals at the company and team level. At the six-month update, people seemed gratified to witness the impact their work had made. After the meeting, a junior planner pulled me aside to tell me that seeing the numbers on the page really made her feel that her individual effort had made a big difference. – Joanne McKinney, Burns Group
7. Transparency Goes Two Ways
We subscribe to full transparency and commit to the highest level of trust with the entire team. Giving that level of trust results in getting that same level of trust and respect back. When that kind of trust is inherent to your culture, it’s amazing what you can accomplish. And you can more effectively deal with the challenges when everyone is aware and working together toward the common goal. – Lori Paikin, NaviStone®
8. Employees Earn Their Way Inside
We incentivize employees with a 10% net bonus on any new business they personally secure. If they bring in an account they get to see all expenses related to running that business, so when we write them the big year-end bonus check they know the amount is legit. Writing a fat check to someone who deserves it is my favorite thing in this business. – Sean Looney, Looney Advertising & Branding
9. Profits Are Better When Everyone Shares In Them
We are a fully transparent company. I believe it’s one of the reasons we’ve grown so quickly. Our internal mission is to be the best-paying boutique agency for the information technology industry. When everyone knows the revenue and profit targets they can see that when they are hit, they get better pay and it gets us closer to achieving our internal mission. Profits and work quality have never been better. – Giovanni Sanguily, TRIdigital Marketing
10. Complete Accountability Fosters Communication And Ownership
When companies make the change and open themselves to complete communication and accountability it changes the way that people communicate as well as the attention that they pay to their jobs. What it means is that there is a complete change in the way that companies relate to employees, and employees act like owners and not like those who simply work there. It is also a way to start a dialog. – Jon James, Ignited Results
11. Sharing Gets You Rowing In The Same Direction
Sharing financials and company goals is important to ensure everyone is aligned and sets their sights on the same targets. If all don’t have access, you won’t be rowing in the same direction. – Jessica Hawthorne-Castro, HAWTHORNE LLC
12. Sharing Opens A Channel To Address Concerns
The executive board hosts a companywide meeting at the beginning of every month to review numbers, goals, problems and successes. During this time of transparency, we talk through any questions or concerns our team may have, providing the response direct from the source and limiting any false speculation. This practice leads to a greater understanding of the business and minimal water cooler talk. – Jason Kulpa, UE.co
13. Tie Your Company’s Financial Goals To Employee Bonuses
About three years ago we started sharing our financial goals, our profits and our “numbers” as often as possible with our employees. That was a deliberate, and critical, shift. We tied our company’s financial goals to individual employees’ bonuses, so our goals are now their goals. When we win, they win. The result? We’re all moving in the same direction. – Matt Moore, OH Partners
