As for entrepreneurs, one thing that strikes, especially those who are new to the role, is that they are reluctant to reveal uncomfortable pieces of information. Whether it is a day-to-day business decision or a strategic issue, business leaders are often limited to stand out from the challenges, especially when doing business. They communicate with their investors.
Apparently, the reason why entrepreneurs do not open enough is to preserve their "character" or to postpone the reality. However, when they get away from a problem, it gradually hinders both. Transparency is essential for a business. Confronting business challenges and going forward is not a cake walk.
Building Trust and Credibility
Transparency builds trust in everything else. Whether in the context of a professional or personal relationship, the more specific you are, the sooner you feel comfortable. This is also true for investors.
The most respectful sign of respect and integrity is the willingness to disclose uncomfortable information. The result is trust, which leads to an accelerated declaration; a win-win for everyone involved. For example, you can send a monthly update to all of your investor base with the majority of your statistics, whether they are good or bad. This promotes trust with your investment partners.
Focus on the cohesion of the team
When you are dealing with uncomfortable things, it can lead to blood, sweat and tears. In such situations, your team may either unite or disintegrate, so it is important that when you encounter problems that can not be resolved immediately, you can count on the contribution of your investors.
When you recognize and explain the problem, it saves time for yours and investors. It also directs everyone's energy positively and the benefits are well worth it. This allows you to spend more time discussing the real issues and then, gradually, it also means that there is more team preparation for everyone
For example, external and internal partners can see how you react to particular complexities, and so on. This can lead to greater cohesion between your managers and your investors. In the early stages, try to push your external partners to meet others.
Get ready for emergency situations
If you work in a transparent environment, it is likely that defects will appear sooner or later.
This is true even for external partners. When you know the frequency and depth at which you dive into strategic problems with your investors, it forces you to constantly make sure that you are on your A-game. Transparent teams can capitalize on every opportunity. In this way, you also strive to crush all the problems quickly. If your investors know that you are working on a strictly transparent basis, it will also force them to give the best of themselves.
Even if you have no investor at the moment, you can contact another fund provider and arrange a meeting with them to discuss your business needs and financing options available with you. This will require you not only to set clear but realistic goals, but also to prepare for the financial and operational scale.
If you are able to rely on other capable people, you can accomplish bigger things. You can take advantage of your teammates and investors by informing them of your problems.
It's wrong to ignore failure – not because you feel like you're not confident, but rather that it negatively affects the pace at which you receive your comments.
Whatever the success of your business, feedback is the most effective and powerful tool to help you improve your skills and lead everyone around you. The more transparency you maintain, the more comments you will receive. Keep pushing yourself and your teammates to provide and get feedback.
The Bottom Line
Most people think that transparency is overestimated – not because they do not want to be open enough, but because they do not believe that value can flow from it. After all, transparency sometimes means that you have to let others know what they do not want to hear.
It is particularly interesting to note that any experienced entrepreneur will tell you that honesty, transparency and communication are the key to his success. So, will the retention of information eventually lead to failure?