How the Next Generation Enterprise is Different
From Opacity to Transparency (part 8 of 10)
Information in the old corporation lacked liquidity --it tended to be locked up within the walls of the firm and even then, often difficult to access appropriately. Corporations had high information opacity -- both within their boundaries and with external parties (stakeholders). Our research shows that companies that open up, embracing transparency as a strategy, perform better.
Transparency is far more than the obligation to disclose basic financial information. People and institutions that interact with firms are gaining unprecedented access to all sorts of information about corporate behavior, operations and performance. Armed with new tools to find information about matters that affect their interests, all sorts of stakeholders now scrutinize the company like never before, informing others and organizing.
Customers can evaluate the worth of products and services at levels not possible before. Employees share formerly secret information about corporate strategy, management and challenges. To collaborate effectively, companies and their business partners have no choice but to share intimate knowledge with one another. Powerful institutional investors today own or manage most wealth, and they are developing x-ray vision. Finally, in a world of instant communications, whistleblowers, inquisitive media and Googling, citizens and communities routinely put companies under the microscope.
Corporations have no choice but to rethink their values and behaviors --for the better. If you're going to be naked, you'd better be buff! By that we mean you'd better have the best value (as value is evidenced like never before) but you'd also better have values -- of honesty, accountability, consideration of others' interests and openness -- built into your corporate DNA, operations and systems.
Companies that embrace new IT services to become open have lower collaboration costs, higher performance and better trust.
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