FINANCIAL TRANSPARENCY SERIES—PART TWO

Financial Transparency

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PART TWO
Getting off to a Strong Start

So maybe you’ve gotten through the “fear of sharing company information” that we covered in Part 1, but now it’s time to execute.

You may not be sure where to start but remember that you’re doing this because you believe that:


A more informed team…

is a more connected team…

which creates trust in the company and the team…

and leads to deeper engagement from all.


Here's a simple guide to help you reap the benefits when you improve the quality and quantity of information you’re sharing within your company.



Below is an example of a simple matrix that one of AVL’s client companies uses to help them stay focused on reporting information to their entire team on a set frequency. 

You’ll see that every week, there’s a weekly asynchronous update sent out. We’ve seen companies do this via video, Slack, and email. Each employee consumes it on their own time. Some companies ‘track’ to see how well it’s being consumed as an indirect feedback gauge. The weekly update is focused on a small number of activity-based metrics that are aligned with weekly-level activities. It’s the organizational scorecard!

On a monthly basis, there’s different update with a larger focus on the company's monthly results - specifically focusing on operational and financial metrics. These can be sales results compared to plan, quality goals, and other monthly cadence key performance indicators (KPIs).

Finally, the company has a quarterly ‘all-hands’ meeting that is attended in person (or via video conference). This meeting has a much more strategic focus in that it focuses on the BIG THINGS that the organization is aiming at to improve and grow. In an EOS run company, this might be a review of the performance against the last quarter’s rocks and a deep dive explanation of the why behind the next quarter’s rocks.


FREQUENCY TYPE TIME CONTENT METRICS QTY FOCUS
Weekly Asynchronous <10 Minutes R/Y/G 5-8 Activity, "Now"
Monthly Asynchronous 20-30 Minutes Analysis, Wins 5-8 Financial, Ops
Quarterly Synchronous 60-90 Minutes Goals, Learnings 3-5 Strategic, Next Qtr.


Over one year, the amount of communication (from the top) totals about twenty hours. Of course, it does take significant effort to produce these communications, but it becomes much more efficient with experience and repetition


To strengthen your communications, below are a few guidelines to consider to improve connectedness, understanding, and engagement.


RECOMMENDATION DESCRIPTION
Consistent send date & time If you commit to provide a weekly update every Monday morning, don’t miss your deadline. You are sending a message about how important this information is by honoring the commitment. And you build anticipation amongst the team.
Consistent delivery tool If you use video or Slack, send it the same way every time. Build the reliability and consumability of the information.
Consistent Format Use the same format every time. Don’t change targets, charts or graphs because you want your team will become familiar with them. Change introduces confusion.
Avoid change Stick to the consistency guidelines for at least 90 days. If you know something can be improved, make multiple adjustments at once, after a full quarter at a minimum. Then, reintroduce the changes!
Feedback and Q&A Provide the team with a mechanism to ask questions and provide feedback. Also, to engage.
Continue to Educate Periodically provide additional education as to why a specific metric is vital to the business and how it's calculated or measured.
Honor the consumption time targets If you say an update will be less than 10 minutes, make it less than 10 minutes.
Name/Brand It Creating logos or brand names for the various reports adds clarity and creates common vernacular amongst the team! Be creative!
Celebrate and add the human elements Celebrate great wins. Recognize team members for great work and other milestones! Bring inspiring emotion to the communications!
Consider a mix of asynchronous and synchronous Both mechanisms have pros and cons. Using a mix of both helps create a stronger hybrid overall.



These are simple but powerful ways increasing transparency with your teams around finances can have a positive impact on your business.

Want to keep reading? Check out PART 3.

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