Why Transparency Is Your Biggest Untapped Competitive Advantage

For Buffer’s Leo Widrich, it’s much more than a buzzword. So why isn’t everyone embracing it?

Why Transparency Is Your Biggest Untapped Competitive Advantage

“Default to transparency” is one of our deepest values at Buffer and it’s been absolutely instrumental in our growth from making nothing just two years ago to making over $1 million a year today.


To us, transparency isn’t a buzzword–it’s a huge competitive advantage when everyone knows what everyone is working on and getting done. It seems obvious, right? But I’m constantly shocked by how many companies say they understand the importance of transparency but don’t make any steps to make their companies more transparent.

Then I read a quote from Marc Effron, president of The Talent Strategy Group, that made it crystal clear to me why that happens, and it changed the way that I thought about transparency forever.

Transparency at Buffer

We’ve taken slightly crazy steps to make transparency real at Buffer. Everybody who works here knows how much everyone else gets paid, what steps everyone is taking to improve, and even how much everyone sleeps.

To make Buffer totally transparent on employee salary and equity, we created a formula that calculates the amount of compensation for any present and future employee. The power of the formula is that it not only answers the question of “how much,” but it also explains why. Every employee knows what goes into the compensation calculation and that there are no backroom deals–and this has created an incredible bond of trust among the team.

Everyone on the team uses an amazing productivity app called iDoneThis, where everyone shares what they get done every day, with a twist. In addition to sharing daily learnings and progress, everyone on the team also shares where they struggled and how they’re trying to improve. We envision a company where people are treated as full human beings, not productivity automatons, with a complex set of motivations and aspirations. Our team inspires and shows us how openness about vulnerabilities leads to greater collaboration, trust, and personal growth.


New employees all receive a free Jawbone UP wristband that automatically tracks your sleep, your steps, your health, and much more. The data is shared among the whole team, which has an awesome side effect. Whereas at other companies you might hear watercooler talk about the football game last night, at Buffer, fellow employees share deeper personal conversations about how they’re really doing and feeling that start from seeing how their teammate is sleeping.

The Fundamental Question

Transparency isn’t all rainbows and unicorns. It was actually incredibly nerve-wracking to make the company more transparent. Before we made all salaries public knowledge in the company, I was terrified.

Both the great strength and cause of pervasive fear of transparency in corporate America is that, with transparency, you show your employees the company for what it is and you expose how it works. That’s disastrous at terrible companies.

This brings me back to Marc Effron’s transformative insight about transparency. Effron consults leaders at global conglomerates on talent issues and he’s often confronted with executives’ fear that if employees know the whole truth about the company, individual employees’ potential to advance with it, and how the company is actually run, employee engagement will tank. Effron’s response is straightforward but absolutely crushing: “Here’s the fundamental question: How long do you feel it’s appropriate to lie to your employees about their future?

For us, the process of making Buffer more transparent started with improving ourselves. It meant stopping to reflect on our values, how we ran our company, and how we could do better. We took transparency as a call to action to become the company that can be completely open and honest with its employees about how it works–and that’s the ethical imperative that inspires us to make Buffer more and more transparent.


Don’t Be Evil at Google

The power of transparency then is that it drives us to be better–to create a company that’s both great and good.

The prime example of that for me is Google, a company whose mantra “Don’t be evil” went hand in hand with its value of corporate transparency. Google’s goodness as a company and its transparency with respect to that goodness drove an external marketing story that turned an unknown company into a global brand bigger than Coca-Cola, and it created an internal employee environment that’s annually regarded as one of the best places to work on Earth.

We take inspiration from what Google has done and we’ve put our own personal stamp on it. Google is known for its amazing, playful employee perks. At Buffer, because we’re focused on personal productivity and growth, every employee has a link they can use to buy Kindle books on the house, no painful reimbursement request required, no questions asked.

Google uses an internal system called Google Snippets, which is a simple place that shows what everyone in the company is working on, so that every employee has the information they need to work autonomously and make decisions. That limits the power of bad bosses to control the flow of information and makes everyones’ accomplishments recognizable by everyone. At Buffer, we use iDoneThis for that purpose, but with the twist that we also share our struggles alongside our plans to improve.

When you’re treating employees well, transparency is a very simple proposition–it’s just telling people what you do. Or, as Marc Effron might say, it’s as easy as telling the truth.


[Image: Flickr user Chad Kainz]

About the author

Leo Widrich is the co-founder of Buffer, a smarter way to share on Twitter and Facebook. Leo writes more posts on lifehacks, efficiency, and customer happiness over on the Buffer blog.