The avant-garde concept of sharing crucial financial and operational information with employees, which can be accessed by anyone from the organization at any point of time, is referred as Open Book Management. Such practice not only will help employees to see the big picture, it will also make them feel responsible for the organization’s growth and success. Here are some of the successful organizations that swear by OBM at their workplace.
Swear By Open Book Management
Pixability
Bettina Hein, the founder and Chief Executive Officer of Pixability admits that she learned it the hard way that open book management is the only way to sustain in a high-risk and high-growth startup. She says, “In my first company, we completely lost the trust of our employees when they thought things were going fine and one day we announced major layoffs. It was so painful that from that day onward we opened all our books to everyone.” So later when she founded Pixability, a video advertising technlogy company, she determined to adopt open book management from day one. According to Hein, employees will adapt their behavior, if you provide them with information. At Pixability, Hein has fostered the culture of transparency by sharing information related to cash, sales, burn rate, and run away every day with her staff of seventy. Hein holds monthly all-company meetings as a part of the workplace culture, during which Hein shares wins, lessons learned, and numbers and what they mean.. The entire teams are informed what they have done since the last huddle and what is coming in the way of progress. Thus, employees at Pixability have a clear idea of their do’s and don’ts and can contribute well on the improvement of overall business.
The Sky Factory
This award-winning company was founded by Bill Witherspoon in Fairfield, Iowa. The company is recognized for its wall and ceiling installations that are inspired by images of sea and sky. These images are installed on the ceilings and walls of spas, hotels, restaurants, and hospitals, thus bringing a part of nature inside. Witherspoon states that OBM, consensus, and transparency are fundamentals of The Sky Factory; he also mentioned that the company is so used to transparency that it is really difficult to imagine relying on the inputs of selected employees. On every Friday, there is a meeting that is attended by all 34 employees of the company, which discusses financial and non-financial aspects of the organization. Every employee of the company is trained in financial metrics so each employee is good at interpreting the key numbers. All the decisions of the company are made by consensus, which has helped it to nurture even in the difficult economic conditions.
The most misunderstood points about open book management is: you do not need to share 100% information; you can share the important points that impact employee while you do not have to reveal crucial information like company’s profitability. It is so ironic how a lot of companies feel a need to control the information flow to do better while the concept of open book management and its benefits are immense.
If you are not sure if this idea will work for your workplace, you can give it a try with 60 to 90 day pilot program. So, you will get enough time to know if it works, before committing to an alien concept. After you have given a shot to this concept, chances are, you will swear by this process in no time!