It may sound scary to tell your employees everything, but that’s exactly what Reid Rasmussen suggests.
He’s seen transparency in action and watched as it greatly impacted his entire company culture. He’s the CEO and Co-founder of freshbenies, where they help employers balance their benefits program.
He came on the Lead to Grow Podcast to tell us all about what he’s learned about transparency and workplace culture, and we captured it all right here:
Economic Transparency Ensures Employees Understand Reasons Behind Decisions
Reid’s arrival at radical transparency started after his company’s inclusion on the Inc 5000 for several years. One year, the reported income was $3.2 million, and an executive from another business said, “Wow! You guys made $3.2 last year! You must be rolling in the dough!”
The idea of transparency hit Reid right then:
If an executive from another company thinks we make all that in net profit, what will our employees think?
He knew it was time for transparency.
So he decided to pull in the entire company into radical transparency — they disclosed all of the company’s financial data. This way, employees could see how much everything was costing, and understand the entrepreneurial mindset behind the decisions.
Giving Your Employees Control, Creates Workplace Unity
Reid took transparency step further. He actually allowed the employees in on the decisions themselves. He gave everyone an opportunity to understand, respond, and give their thoughts and suggestions on the executive decisions of the company.
This buy-in from the entire workforce brought a greater sense of unity and trust throughout the whole team.
A while after implementing these transparency changes, there came a time when Reid knew their company needed to make a rapid turn with their business, and totally revamp their software. The last time he had done such an upgrade was before his transparency awakening. Back then, without getting employee buy-in, employees gave him a lot of push back. This time, he was trying to re-do the entire tech framework for their offerings, and he needed it done in 6 weeks.
Because transparency permeated the entire company, and each employee helped make decisions all along, there was no push back. The employees either completely agreed because they understood, or they trusted Reid enough to go forward, even if they didn't totally understand the reasoning.
Transparency Helps Attract the Best Talent
One of the most profound impacts transparency will have on your workplace is how it impacts your culture. If you are in a fast-growing company, you can't leave culture to chance, because the number of newer hires will soon outpace those who were present from the beginning.
If you weren’t vigilant about replicating the desired culture when you hired the newer employees, a new culture can start to wash away the one you wanted but never articulated.
On the other hand, if you define your culture from the beginning (whether that's integrity, humor, tech-savviness, entrepreneurial mindset, innovation, customer service, etc.), you can intentionally look for those characteristics as your growth accelerates. Each time someone comes onboard your team, they will be adding to the culture you sought out.
This also helps talent self-select. People naturally seek out those companies they have a connection with. What better way to attract the culture you’re looking to create, than to have a well-defined culture that permeates every touchpoint you have with the market (online, social, brick-and-mortar, customer service, etc.)?
With a Strong Culture, Employees Make Better Decisions, Faster
Another benefit of clearly communicating a strong culture: Employees feel empowered to make decisions, and they make them faster.
In my own company, I witnessed the impact that defining your culture can have on a workplace. Employees no longer feel the need to be “led by the bit,” as they start to make decisions within their own swim lanes. Once they understand the culture, they make decisions that are in line with company policy, procedures, and mission.
Further, because they feel empowered to make their own decisions, they solve problems much more quickly.
If Someone Had Lunch With You, What’s the Key Thing You’d Want Them to Walk Away With?
(We love throwing this curveball question to guests!)
Reid: “I'm like that labrador retriever. I always want people to walk away feeling better. They may not agree with everything I say or do, but they won't think I was ignoring them!”
This blog post is from a podcast interview with Reid Rasmussen, CEO & Co-Founder of freshbenies.