Modern leaders know that in order to get their employees to be loyal to their companies and work at their most productive levels, they need to engage with them.
Engagement has been shown to be one of the most vital strategies a manager can achieve in order to stop high employee turnover and build a positive corporate culture with happy employees.
How does one engage their staff?
One such way is with open book management.
This theory was first coined by John Case of Inc. Magazine in 1993, and has been implemented and written about ever since.
Back before the rise of corporate scandals and social media, Case was a forward-thinker that to be open with their employees in order to promote the most efficient workplace.
What Is Open Book Management?
Open book management’s main concept is that bosses need to reveal information to their staff not only pertaining to their specific job roles, but so that they can get a good sense of the organisation’s overall mission, goals and plans.
Case stated that “a company performs best when its people see themselves as partners in the business rather than as hired hands,” according to one .
Case employed three main points in this theory, which included:
- The organisation should be open about financial records and other important information with staff
- The staff should be encouraged to help the company raise revenue
- The staff should be rewarded for their hard work in helping the company succeed
How Can You Implement Open Book Management In Your Firm?
It’s not easy to make the switch from a traditional top-down where only the senior executives are privy to sensitive information to a bottom-up system.
Truth be told, a company should only consider doing this if they are prepared to share their wealth with their employees.
Although in public companies financial information is more or less in the open; employees of private companies may become disgruntled if they know how much profit a company is making, but are not rewarded fairly for their efforts.
Before sharing financial data with employees, it is important to train them to read and understand this type of information.
Case recommends finding a “Critical Number,” which is the amount a company needs to either break-even or to be profitable.
Once this number is calculated, all employees can be involved in the decision to reach or surpass it.
Open book to become true partners instead of simply workers.
They become invested in helping the company succeed, not only because they are made part of the “elite” executives, but because they have a financial stake in this endeavour.
Head of Training and Development
(Image by Dollarphotoclub)
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