Family business owners understandably want to keep certain business matters private. That seems especially true of financials. To a certain degree, I agree with this mindset. But I’ve found that being open and honest with your team benefits everyone far more than withholding information, including financials. So, to any business owners struggling with whether to make certain financial information available to their people, I say, “Please share your numbers!”
Common Reasons for Not Sharing Numbers
My clients will give a lot of reasons they cannot or do not want to share their numbers with their people:
- “We can’t share our revenue or profit. We don’t want people in our town to know how much we make.”
- “We can’t have Scorecard numbers that show our sales. People will think we make more money than we do.”
- “We can’t share our financials with the leadership team… they might tell others on the team.”
I have even heard advisors say things like: “I make all my clients share their numbers, except my family businesses. I can see why they don’t want to.”
Real Numbers vs. Fake Numbers
Here’s what happens when leaders don’t share their numbers with their team: the team makes up numbers. Typically, by the time they’re done weaving their version of your financials, the numbers do not resemble reality.
For example, if you sell a work truck for $85k, many assume you now have $85k to spend on your family.
In that same vein, if you sell a $220k kitchen remodel, people will assume you have $220k toward your next family vacation.
These “fake numbers” can cause a lot of issues if you don’t share your real ones. Fake numbers can sow discontent among employees who feel short-shrifted while you’re living it up in your big ole mansion. (Because every business owner lives in a big ole mansion, right?)
Show how the funds from the kitchen remodel support the full business. Sharing the real numbers will squash those rumors of you swimming in a pool of money like Scrooge McDuck.
What Success Looks Like
Finally, if you don’t share your numbers, how will your team know if they’re succeeding?
There’s an old story of how Charles Schwab turned around one of the poorest-performing steel mills simply by sharing an important number. By knowing what the previous shift had achieved, the next shift knew what success looked like for them (beating the previous shift’s number).
I recently heard the story of a family business that didn’t want to share their revenue numbers with their team. Then they got close to breaking a revenue number. They decided to share that fact with the team.
Knowing they were close to breaking a revenue number before the end of the year, the team dug in. Eight weeks passed. When the books closed on the year, not only did they break the record, but the business earned $1.5 million in revenue over it.
What happened? Their team had been playing a game of football with a dark scoreboard. When they suddenly saw the lights on the scoreboard, they got super focused and won the game by 1.5 million points!
Why not set your team up to get focused and win the game by 1.5 million points?
Share Those Numbers, Please
So, please share your numbers.
As you get started, share the numbers carefully and honestly. If it makes you nervous, let your team know that. Take your time and answer their questions. Explain how your business works. Your people will see just how important their roles are to the success of the organization.
Just like many important messages in your business, you will need to share this over and over again.
The results may surprise you in the best possible ways. Follow EOS® the way it was designed. You won’t regret it.