Even if your sights are set on a goal far beyond $85 million in revenue (not valuation), you would be wise to take a lesson from Michael Kiolbassa, whose product you’ve probably eaten more than once.

Grandson of the founder, Kiolbassa wasn’t prone to delegating. He did listen to advice from a wide range of pundits and was prone to “management by bestseller.”

Until, that is, the company was blindsided with a giant cost increase that should have been forecasted, but wasn’t.

For years, he saw his role as the solver of all problems. That’s what he’d learned from his dad, who would even fix the machinery. “I’m the production guy,” Michael explained to a consultant in 2010. “I’m the sales guy. I’m the culture guy. I’m the guy.”

“Is it working for you?” the consultant asked.

“No, it’s not.”

That’s when things changed and he started delegating.

Sales soared as did production, but not in concert, so the losses almost killed the company.

That’s when Kiolbassa was introduced to open-book management, which he embraced, with a quarterly bonus incentive for everybody, and everything changed.

“I got everybody together, shared the financials in detail and showed them just how much money had been lost,” says Michael. “They had no idea.” (…) Posted in Spanish as well as English, the financial displays let everyone track whether the company is likely to pay a quarterly profit-sharing bonus

And that’s the key that most CEOs don’t get.

There is a wealth of information at every level within every organization, not just from those with fancy titles, if you are willing to listen.

“Suddenly,” says Michael Johnson, a Kiolbassa vice president, “you had guys on the shipping dock looking at invoices and saying, I know we can get jalapenos cheaper.”

Proof, as is said, is in the pudding, or, in this case, the financials.

In fact, they turned the first quarter of 2018 into the company’s most profitable ever, with revenue growth of 30% and a profit margin of 6%.

Think what open-book management could do for your company — if you have the guts to implement it.

Image credit: Kiolbassa Smoked Meats

There’s a lot of talk these days from consultants, academics and executives about the importance of transparency, AKA being totally open and honest.

And many of those in the business world, from team leaders through CEOs, are actually walking the talk.

Or believe they are.

The problem lies in the fact that even those executives who have opened operations, especially financials, to the internal scrutiny of their people don’t recognize that true transparency needs to be a two-way street.

One-way transparency is open to spin — whether intentional or not.

Which, if you stop to think about it, should come as no surprise. It is a normal, human characteristic to put the best face on even the most negative thing.

So how is true, two-way transparency achieved?

By opening yourself to a no-holds-barred Q&A with everybody and forcing yourself to provide the A no matter how uncomfortable.

Harley Finkelstein, COO at Shopify and a new “Dragon” on CBC’s Next Gen Den, among other things, is the perfect role model of what should be called AMA transparency.

The AMA idea has been around for a while.

President Obama broke with convention back in 2012 when he agreed to do an Ask Me Anything — AMA — on the Internet forum Reddit.

But if you think it takes guts to expose yourself to a half hour of inquiries from strangers on the web, try fielding regular sessions of no-holds-barred questions from your own employees — live and on camera. Welcome to our normal routine: the internal AMA.

… While facing questions from my team is tough when I’m in the hot seat, it’s become a crucial tool for building trust as we’ve scaled from hundreds to more than a thousand employees.

I doubt you’ll find a lot of executives willing to do it, because a true AMA isn’t exactly fun for those in the hot seat, as Finkelstein freely admits, but it’s a great way to build trust, ownership/engagement, eliminate fear, etc.

There are plenty of times when I’ve been caught entirely off-guard. But that’s precisely the point. The element of surprise is the secret ingredient that makes the internal AMA such a valuable tool. (…)

Creating a culture where it’s safe to ask literally anything can lead to some awkward moments, but just taking that step helps instill a sense of ownership at every level. Sitting in that hot seat might make you sweat, but that just means you’re doing it right.

Do you have what it takes to “do it right?”

Image credit: Shopify

PS: Shopify is the first site I’ve seen that offers a “download” link next to all their leadership team.

Among today’s most popular buzzwords is ‘transparency’.

Transparency is one of the most important underpinnings of ‘authenticity’ and ‘trust’.

Corporations large and small trumpet the transparency of their dealings—except financial ones.

(Individuals, too; they will describe in detail their thoughts, attitudes and actions, even their sex lives, but freak when the subject is their money.)

But some bosses believe that financial transparency is not only possible, but can lay the groundwork for an extraordinary culture.

Financial transparency means not just sharing all the company financials with all its employees, but ensuring they have the skills to understand them by explaining and discussion them.

It’s called open-book management and was documented in “The Great Game of Business” by Jack Stack and Bo Burlingham.

Mr. Stack and the managers bought the plant [International Harvester engine plant], renamed it Springfield ReManufacturing and turned it into a thriving collection of more than 30 businesses now known as SRC — thanks largely to an innovative strategy that came to be known as open-book management.

The basic rules are

• Know and teach the rules: every employee should be given the measures of business success and taught to understand them
• Follow the Action & Keep Score: Every employee should be expected and enabled to use their knowledge to improve performance
• Provide a Stake in the Outcome: Every employee should have a direct stake in the company’s success-and in the risk of failure

Ari Weinzweig and co-founder Paul Saginaw wanted that kind of inclusive, engaged culture when they started their company and used open-book to anchor their growth.

Zingerman’s Delicatessen, a tiny sandwich shop near the university, into a group of nine businesses that, three decades later, has 650 employees, 18 managing partners and combined annual sales of $50 million.

That’s called success and has been recognized as such and emulated a la Tony Hsieh.

Wayne Baker, a professor in the Ross School of Business at the University of Michigan, turned it into four case studies. Bo Burlingham featured Zingerman’s in a book called “Small Giants,” which is about companies that “choose to be great rather than big.” And the owners and employees of more than 1,000 companies have attended ZingTrain seminars to learn more about the Zingerman’s model.

While their approach is definitely a success, not everyone likes or wants the involvement.

Former staff members talk about the frustrations of having to placate difficult customers, as well as the stress of being “Zingy” throughout a long shift. “It is exhausting to work somewhere where you feel like you have to improve what you do constantly,” said one former worker at Zingerman’s Roadhouse.

Others love it.

Krystal Walls, who works in the mail-order business and has two children and a third on the way, said at the training session, “I have never worked anywhere where I was trusted or respected like this.”

When their little deli first succeeded they were offered substantial buyouts, as well as the opportunity to franchise, but none of those options allowed them to pursue their vision and make a difference. The company pays its people well and provides full health benefits.

“Employees who are stressed out financially, wondering how to pay for their kid’s allergy meds, or their rent or auto insurance, are not going to be able to do their job well,” said Mr. Saginaw, who has been lobbying in Washington for the last year for an increase in the minimum wage. “We’re comfortable with the notion that there’s such a thing as enough. Others may be wealthier than we’ll ever be, but I wonder if they’ve lost a certain amount of joy in their work.”

Flickr image credit: Carl Collins