Startup Transparency

September 16, 2014

in Culture, Leadership, Operations, Team Building

I am always interested about the topic of transparency in startups and management of teams. How much information is shared among team members? Are revenue metrics shared? Are cost metrics shared? Are employee salaries shared?

There are examples of all of the above in startups I know. Some are on the extreme end of transparency (such as Buffer) sharing everyone’s salaries with the world. Check out this post by Joel that discusses their core value of transparency.

Some startups share nothing and keep everyone in the dark about the overall business metrics.

Most startups fall somewhere in the middle.

Clayton Christensen recently tweeted a link to this HBR article that talks about the downsides of transparency. The main point of the article is that overly transparent organizations may inadvertently discourage experimentation as people feel a lack of privacy in their ability to operate. “For all that transparency does to drive out wasteful practices and promote collaboration and shared learning, too much of it can trigger distortions of fact and counterproductive inhibitions. Unrehearsed, experimental behaviors sometimes cease altogether. Wide-open workspaces and copious real-time data on how individuals spend their time can leave employees feeling exposed and vulnerable. Being observed changes their conduct.”

At ArrayFire, we are open with our employees about our revenue and sales-side metrics. We are closed about our costs and expense-side metrics. We generally seek to track how we spend our time and hold each other accountable. We are always working to improve that process and find the right level of granularity for tracking those metrics. Overall, I trust our people fully. We hire great people and give them autonomy to do great things!

What level of transparency does your startup hit?

 

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