Why CFOs are embracing transparency
Today I am delighted to welcome Vice President of Global Marketing for Concur Technologies, Melton Littlepage, to the Workiva blog. In this special edition guest post, Melton shares with us his experiences and thoughts about embracing transparency and how it leads to strategic benefits.
A movement for greater transparency is gaining ground across a wide variety of industries these days, but why?
It turns out that greater transparency has a host of strategic benefits. Take for example the case of travel and expenses, the second most difficult line-item to control in most companies’ budgets, after employee salaries.
As Terry DePolo, Senior Director of Accounting at Concur put it, transparency allows him to spend “less time babysitting” and more time leading the company in the right direction. As he puts it, it’s about going from “bad guy” to “super hero.” How travel and finance managers control bad spending is directly linked to the amount of visibility they have into transactions, both at the individual level as well as the aggregate.
Embracing greater transparency will shed light on opportunities and pitfalls alike for your company. What makes transparency worth the trouble? I see four main benefits.
The four Cs: the real world benefits of transparency
- Competitive advantage
Transparency can give companies a competitive advantage, both when extraordinary circumstances arise and in daily activities. For instance, transparency helped Amazon tremendously with a recent departure of a key executive. Amazon announced in September that their CFO of 12 years, Tom Szutak, would retire. According to CEO Jeff Bezos, Szutak was often the company’s motivational speaker for quarterly earnings and was hugely involved with Amazon’s category expansion.
Amidst such changes, it’s a good time to think about how allowing access to key information within your broader company helps both management and the rank-and-file grapple with uncertainty. Amazon’s CFO wasn’t leaving the next day—a 10-month transition period was planned to help the new CFO ease into the role, and the company has endeavored to maintain accurate, detailed updates to key audiences. For Amazon, transparency allowed them to tap into the institutional knowledge and cultural importance of an outgoing executive and, in so doing, keep its competitive advantage alive.
Adding transparency to the day-to-day tasks of company record-keeping can provide a competitive advantage. A little visibility can help create a healthier balance sheet and free up critical cash for more important line items in the face of competition, especially as companies scale.
With more visibility into workplace transactions and activities, there is a heightened confidence in the accuracy of information, especially among management teams.
At Concur, the concept of ‘The Perfect Trip’ exemplifies this by giving employees a tremendous amount of visibility into the trip selection process. As Concur CEO Steve Singh attests, “You should be able to share your preferences with your company, and it should be able to keep you safe in case of emergency.” Users can see all travel options available to them, with the ability to pick and choose. The more information you make available in strategic and empowering ways, the more you boost connectivity and confidence in teams across the company.
CFOs have a large stake in controlling this data-driven esprit de corps, due to the visibility they have into nearly all departments. From entry-level positions to the C-suite, there is peace of mind for all involved when transparency increases in smart ways on core deliverables, daily activities, and high-level campaigns.
- Cultural alignment
Transparency helps align managers and employees by fostering a spirit of mutual benefit. Employees get more context around specific requests, and managers get more visibility and insight for informed decision-making. And with cloud technology, being on the same page is easier than ever. Solutions such as Wdesk and Concur’s Expense Management allow for real-time visibility, tracking, user accountability, and flexibility for access anytime and anywhere.
The more employees can be in the loop with a company’s future plans, the more they can tailor their own role to match the company's near-term and long-term objectives. Employees want to know how their role maps to the organization’s overall trajectory for growth. This is especially true within larger organizations, where in-person visibility can be less frequent and communication runs along lengthy pipelines.
Compliance is of paramount importance, of course. Companies must be in close compliance with legal frameworks and regulations, or risk running into big problems. The good news is that transparency can make adhering to policies and codes much easier, reducing the amount of time it takes to manage the often complex process.
Workiva created Wdesk, a cloud-based platform for enterprises to collect, manage, report, and analyze business data in real time. Wdesk upholds your reputation when it comes to being in-line with key expectations. They recommend using a transparent approach from square one, being as honest as possible at every step, and making a true commitment to openness and integrity.
Being rigorous and proactive in the application of transparency is vital for true compliance.
Embracing transparency can bring about many business benefits, namely the four Cs of transparency: competitive advantage, confidence, cultural alignment, and compliance. Taking a closer, critical look at your recorded data—bills, emails, and other documentation shuttled among departments and managers—can lead to a workplace with more accountability and quality assurance in general. Transparency is immensely valuable if you want to keep your organizational machine well-oiled.