For some organizations, transparency may be an undervalued priority, if it’s one at all. But the fact is, transparency as a goal is rising in importance, so it would behoove businesses to get with the program, particularly when it comes to compensation.
Let’s look at why pay transparency should be a top priority.
When a company promotes communications with employees, and are up front about company doings, its workforce has better morale, which leads to enhanced productivity. These companies also build trust and give employees a sense they’re working for an organization with high-standards.
That’s especially true when it comes to pay.
How Did Transparency Become So Key?
- The move toward transparency was sparked by a distrust of corporations. In a recent Corporate Perception Indicator survey, just 36% of U.S. respondents called corporations a “source of hope.” That’s compared to 84% of respondents in China. Many Americans assume corporations are focused on profits over personnel.
- Also, an increased demand for transparency has been promulgated by the increased prevalence of rating and review sites. Nowadays, it’s too easy to go online to learn nearly everything you wish about a firm’s operations, offerings and overall customer experiences. In fact, some 88% of consumers trust peer reviews such as Consultants 500 as much as a friend or relative’s recommendation.
You can also usually find out how well – or poorly – a company pays. There are online forums in which you can even learn what certain positions pay. So, organizations may as well come clean when it comes to compensation: people will find out anyway.
Your organization could take a reputational hit If your news isn’t good, On the bright side, you could attract and retain good talent — which positively affects the bottom line — if the word gets around your company isn’t a skinflint.
A pay equity analysis is the way to go in terms of learning how your company is faring on the compensation front. Get on top of that and make fixes where necessary before your company’s reputation is damaged.
- Social media has also had a major hand in the focus on transparency. Some 88% of organizations engage with customers through social media marketing. Info spreads swiftly in this 24/7 social media world and customers are always on the lookout for new developments. Company’s reputations are precarious. It only takes one key bit of negative news to adversely affect them. So, it’s best for companies to stay in front of news and avoid issues caused by some unintended revelation.
- Info availability is also key. In this, the Information Age, consumers want to know everything when they want to know it. To avoid consumer suspicions, companies should provide as much data as possible, and as openly as possible.
Transparency in the Future
Every business that seeks to build or maintain customers’ trust should be aiming to enhance productivity. But what about the future? Will some businesses double down on being closed and secretive? Or, will the public expect to be able to find almost any info about your company?
Because consumer demand has risen over the decades, transparency will continue to be a priority for American consumers. In fact, such demand will likely increase as social media and digitization keeps all of us connected.
You need to make sure your business is prepared.