When it comes to entrepreneurs, one thing that is striking, especially those that are new to the role, is that their hesitance to reveal some uncomfortable pieces of information. Whether it is about an everyday company decision or a strategic issue, business leaders often restrict themselves from being in limelight on challenges, especially while communicating with their investors.
Apparently, the reason entrepreneurs don’t open up enough is to either preserve their “character” or postpone reality. However, when they shy away from a problem, it gradually hampers both. Transparency is essential for a business. Coming face to face with business challenges and going head-on is not a cake walk.
Build Trust and Credibility
Transparency establishes trust over anything else. Whether, it is within the context of a professional or personal relationship, the more clear-cut you are, the faster you are comfortable with each other. This is also true with investors.
The most considerate pointer of respect and integrity is the willingness to disclose the uncomfortable information. The outcome is trust, which leads to expedited declaration; a win-win for everyone involved. For example, you can send a monthly update to your entire investor base with majority of your metrics, regardless of whether they’re bad or good. This fosters trust with your investment partners.
Emphasise Team Cohesiveness
When you come face-to-face with uncomfortable things, it can result in blood, sweat, and tears. In such situations, your team can either become united or it can disintegrate, so it’s important that when you face problems that are not immediately solvable you can rely on your investors input.
When you acknowledge and explain the issue, it saves both yours and investors time. It also directs everyone’s energy positively and the advantages are worth it. It ensures more time is spent discussing the real issues and then gradually, it will also mean there’s more team preparation for everyone
For instance, both external and internal partners get to observe how you respond to particular complexities and so on. This can result in more cohesion amongst your leadership and your investors. In the initial stages, try pushing your external partners to meet more.
Keep Yourself Prepared for Emergencies
If you work in a transparent environment, then it is likely that shortcomings will appear sooner or later.
This even goes for external partners. When you know the frequency and depth at which you dive into strategic issues with your investors, it enforces you to constantly ensure that you are on your A-game. Transparent teams can capitalise on each and every opportunity. This way you also strive to squash every issue quickly. If your investors know that you work on a strictly transparent base, it will also force them to give their best.
Even if you do not have any investor on board at the moment, you can contact an alternate funds provider and keep a meeting with them to discuss your commercial needs and funding options available with you. It will enforce you to not only set determined yet realistic goals, but also to prepare you for financial and operational scale.
Seek Assistance at The Right Time
The more known your problems are, the more likely it is that you will receive help. Some people are embarrassed to ask for help when they hit a roadblock, due to their insecurity.
If you are able to bank on other capable people, you can accomplish greater things. You can leverage your teammates and investors by letting them know about your problems.
It is bad to overlook failure–not due to the reflection of the perception that you’re not confident, but rather it negatively affects the pace at which you receive feedback.
Regardless of how successful your business may be, feedback is the most effective and powerful tool to make you get better at your skills and lead everyone around you. The more you maintain transparency, the more feedback you will get. Keep pushing yourself and your teammates to provide and get feedback.
The Bottom Line
Most people think that transparency is overrated — not because they don’t want to be open enough, but because they don’t believe much value can come from it. After all, transparency sometimes means you are required to let others know what they might not want to hear.
It’s particularly interesting to note that any experienced entrepreneur will tell you that honesty, transparency and communication is the key to their success. So, will holding back information ultimately lead to failure?