Why Transparency is Important in Business

The days of being able to easily cover up internal and external problems in business are quickly coming to a close. Customer service issues are becoming public relations problems as people are taking their complaints to social networks instead of (or in addition to) a more traditional customer service department. People today like seeing something real in the companies and brands they are loyal to. Some organizations get it, but far too many don’t.

Some businesses, which I won’t name here, like to give the appearance of caring by establishing a Twitter account and apologizing to one out of every ten complaints that are directed their way. They’ll use it to promote their big product and respond to every compliment they see. This is an obvious illusion, and one that the vast majority of regular people can see through in an instant.

In this day in age, people respect something real and genuine from both businesses and individuals. They recognize the attempts to minimize issues and expand on achievements far too easily. Brag about things that are going right, but be realistic. I’d be far more interested in a brand that owns their failures and turns them in to successes through solving the problem and taking steps to resolve it for every customer.

Timeliness is also key to successfully leveraging social media to your advantage. Letting a situation grow and fester to the point of becoming viral can be detrimental to your business. Keeping an active lookout for situations and addressing them as they come will nip potentially explosive situations in the bud and do more to improve how the public perceives your company. You want members of the public to say, “You know, they messed up there – but they took action and made sure the issue was resolved.”

This is one of the core reasons why transparency is important in business. By taking action and providing a resolution you’ve shown that you care, and most people would trust a brand that cares about righting the wrongs more than one that tries to pretend everything is perfect, all the time.

The growth of social media has given consumers and businesses alike incredible tools to communicate with each other and connect in ways that was never possible before. Now, instead of requiring countless hours of research to make an educated guess as to what your customers want, you can simply ask them and likely end up with a much more accurate response. Companies that get it are flourishing, even during these tough economic times.

3 thoughts on “Why Transparency is Important in Business”

  1. Chris, you’ve also touched on something and that is brand. The best brands provide consistent service from start to finish. Their actions support the words and their advertising.

    When a comment is brushed off or a complaint dismissed then my relationship to that company and that brand has diminished.

    You mentioned internal problems and that is something I think that companies are missing. Every employee they hire is an ambassador for their company. If the employees are unhappy then there’s a good chance the end-user will be as well. Excellent post. Thanks.

  2. Chris, you’ve also touched on something and that is brand. The best brands provide consistent service from start to finish. Their actions support the words and their advertising.

    When a comment is brushed off or a complaint dismissed then my relationship to that company and that brand has diminished.

    You mentioned internal problems and that is something I think that companies are missing. Every employee they hire is an ambassador for their company. If the employees are unhappy then there’s a good chance the end-user will be as well. Excellent post. Thanks.

  3. One thing that is discouraging as a business owner is people who take to social networks to complain without providing business owners with a chance to address issues. People are sometimes rude and extremely inconsiderate and would never say something directly to someone that they have no problem blasting from a public forum. I think it’s great that consumers now have so much power, but with power comes some level of responsibility. No matter how dedicated a business owner, particularly a small business owner, is to doing right by customers, it’s just not possible to delegate decision making authority all the way down to front-line staff.

    I understand your issue with Best Buy, but if the worker on the front line who probably doesn’t care what her store’s profitability is, is given too much power as a matter of policy, you’d have massive problems with employees gaming the system. With respect, Chris, as I do respect you, have you considered what you would do if you were responsible for staffing 100s of Best Buys. How would you manage it while preventing loss? Do you realize that Best Buy loses tons more from employee theft than from customer theft at that some Best Buy employees take the job in order to be better positioned to steal from the company? The issues are complex and there are a lot of unintended consequences when you empower people.

    I can tell you from the trenches, running a small business is hard, and one of the most challenging aspects of running a business is finding reliable, intelligent, careful, and diligent people who will care for a company they work for as if it was their own, but also care about customers. You need policies for most folks as they have a real hard time treating each situation as a business owner would, i.e. as a unique occurrence requiring requiring careful thought and a decision based on context. Policies are much easier for employees.

    I do believe in empowering employees, but you can only empower people as they prove themselves mature and capable of making wise decisions that are both fair to the consumer and reasonable for the business.

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