One of the questions any business owner faces is how and when to share information. I believe that sharing information openly is critically important, because employees want to feel involved and to know that what they’re doing really makes a difference for the company. How can you create such a collaborative, empowered environment without sharing the measuring stick of success—financial numbers?
There’s a whole cultural hurdle, a trust hurdle about sharing numbers, but I want to propose something a little different. Let’s talk about effective ways to share information so we can have authentic conversations with our team members and so they can understand where we’re going, where we’ve been and how we can make knowledgeable decisions to accentuate our strengths and maximize our successes.
The traditional way to talk about numbers is the balance sheet or P&L, but not everyone in an organization knows how to read a P&L. You need a more accessible way of disseminating information—like a graph. If the trends are going up, that’s good. If they’re going down, that’s bad. With that simple metric of up is good and down is bad, everyone at every level of the company can help make knowledgeable decisions.
Looking over the bow and the stern
I’m a Coast Guard captain and I love boating. In the boating world, if you look over your stern and see that your wake is straight then you know you’re doing a good job steering—but that doesn’t tell you where you’re going.
The traditional financial tools we get from our accountant, such as a profit and loss statement, are like looking over the stern. That’s useful, but it doesn’t give us the information we need to strategize about the future. So, how can we look over the bow?
We can look at an economic report or economists’ predictions for our industry segment. We can also look at our own website traffic and how many inquires we’re getting, since inquiries may eventually become sales and then become revenue. Our own data can help us predict what’s going to happen in our organization in six months or a year.
Creating your own “kitchen cabinet”
In the early 1800’s, President Andrew Jackson sought help and support from an informal group of advisers. His political adversaries made fun of this unofficial “kitchen cabinet,” but the President actually had a good idea. Support networks, even informal networks, are an import tool we can use to exchange information and ideas.
As CEO’s who are some of the industry professionals with which we as CEOs have working relationships? By collectively sharing information we can fine tune our picture of where the industry is going. That will help us figure out how to work with our customers and suppliers in order to create holistic solutions that work for everybody.
The Bottom Line
The take-home message here is if you share critical information effectively including financial numbers, your company can work together as a team.