Transparency: A Competitive Advantage?

Phase one - Transparency as an answer to revealed misconduct

During the last decades of the past century, transparency in business mainly has to do with sudden, mostly negative, emerging issues. A journalist or pressure group reveals misconduct concerning child labour or environmental pollution and makes it public. The company reacts as it faces loss of reputation and potential severe economic damage. At best it organizes a well-orchestrated public relations campaign. The company announces thorough research and takes measures to prevent the issue to happen again. 

“Transparency is the new marketing” - Neil Patel

Phase Two - Transparency to show organisational strength

With the turn of the century, change comes to the way companies approach such transparency-themes. Instead of informing the public reactively out of self-defence, companies use transparency proactively as an expression of strength. From then on transparency more and more is used to justify company’s actions. Nowadays no one is surprised if a company provides the public with former classified information on top-management remuneration, bonus-schemes, tax-payments and place of origin of used materials. The more open about these themes, the better the company’s image.

Phase Three - Transparency to emphasise value for the customer 

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Nowadays a new trend in transparency is rising: transparency by default. Companies start to take transparency from the level of the mainstream public themes to the mere core of their company purpose. And thus to the interest of their customers! By showing what companies thrive for and how well they succeed they build stronger relationships with great results as an effect.  These companies self report increasing attention for their regular ‘transparency updates’ and increasing levels of trust between team members and customers. And it works! By sharing of all sorts of numbers, it adds important context to their products that make their usage fit with their customers’ needs. And thus increase business success. 

This article was written by
Arthur Linssen

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