Okay, executives, entrepreneurs, government officials, nonprofit managers and anyone else who leads people: It’s time to get smart about your communications.
In a today’s ultra-competitive marketplace, organizations have to be fleet-of-foot, constantly driving up efficiency and driving down costs, all while improving customer relationships. This is especially true in times of economic difficulty. Engaging line and support staff in the drive for bolstering the business is the sine qua non of effective organizational leadership. Thus, effective employee communications is at the heart of running the business.
Unfortunately, during economic downturns, many leaders tend to avoid communicating with their people. That is exactly the wrong thing to do. Last October Weber Shandwick reported that almost three-quarters of employees felt that their company should be communicating more about current economic problems, not less. Failing to do so has a real impact on operations. According to a Workforce.com report from also from October 2008, 48 percent – or approximately half – of staff said that the economic uncertainty has caused them to be less productive.
Fear, uncertainty and doubt due to the lack of effective internal communication can also cause high-performing employees to jump ship, since they are the ones with the most options to go elsewhere. When they do, morale plummets even more among remaining staff. This in turn often adversely impacts customer service, further damaging the organization’s brand.
It’s time for leaders to wake up. Effective employee communications aren’t just nice, touchy-feely activities. They are real contributors to the bottom line. According to Watson Wyatt’s 2007/2008 Communication ROI Study:
- Effective employee communication is a leading indicator of financial performance.
- Companies with the most effective employee communication programs provided a 91 percent total return to shareholders (TRS) from 2002 to 2006, compared with 62 percent for firms that communicated least effectively. Moreover, a significant improvement in communication effectiveness is associated with a 15.7 percent increase in market value.
- Firms that communicate effectively are four times as likely to report high levels of employee engagement as firms that communicate less effectively.
I have seen it with clients dozens of times: When budgets are tight and the outlook is future murky, their knee-jerk reaction is to freeze up and retrench. Harried managers, desperately seeking savings, seize on cutting costs in corporate communications precisely when this area is most needed.
Don’t fall into this trap. You owe it to your people, your shareowners and your customers to do the smart thing: communicate with and engage your team even more during these tough times.
Do you agree? If so, how will you answer this call?