Open Book Management—Common Sense but Not Practiced by Majority of A/E Firms
Press Release: May 27, 2011
FAYETTEVILLE, Ark. (May 27, 2011) –Open book management, or sharing summary financial data with all staff, has been called one of the most important management trends by industry leaders and management experts. A recently released ZweigWhite publication, the 2011 Financial Performance Survey, showed that only 21% of A/E/P and environmental firms share full financial information with all firm members.
The closed book status quo has remained over the past 10 years. In 2002, 20% of respondents to that year’s survey practiced open book management. This percentage reached 25% in 2005, but then decreased, until a sudden jump to 26% in 2010. This year’s drop represents a 4% decrease.
The firm members most likely to see their firm’s financial information are presidents, CEOs and managing partners, with 72% of respondents citing these as the people who see the financial information. Fifty eight percent of respondents said vice presidents and principals see the firm’s financial information.
“This data blows me away,” says Mark Zweig, founder and CEO of ZweigWhite. “I cannot understand why any firm owner would not want their employees to understand the basic economics of their business. Sharing the information is how people learn. Plus, NOT sharing it works against trust between management and employees. No one in business can afford to do anything that hurts morale, especially if it is within their control.”