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by Sharon R. Rode (an excerpt from the Development and Future of Corporate Communications in a Disruptive Age - Master's Thesis, '09)
The owner of a mid-sized business is experiencing positive growth. His employee pool has just exceeded one hundred and work continues to flood in. There’s just one problem. This mid-sized organization is secretly losing up to $524,569 annually as a result of ineffective communication.
An annualized $524,569 is the estimated cost to small and mid-sized businesses (SMB) in 2008/09 for poor and ineffective communication as found by SIS International Research and Siemens Enterprise Communications in their recently published white paper,
SMB Communications Pain Study: Uncovering the hidden cost of communications barriers and latency.Key study findings showed the top five pain points for the SMB are:- inefficient coordination of communication
- waiting for information (inability to find it)
- unwanted communications
- customer complaints
- other barriers to communication
These costs were not isolated to a select few either. More than 70% of the study’s 400 respondents indicated that they experience all five of the top pain points and said they spent on average 17.5 hours a week addressing them. Further, they determined that what is true for the SMB is also true for the larger enterprise (LE).
The Value of CommunicationsIf these findings are true - then the value of communications to an organization is rising exponentially. Corporate communication is a fundamental principle of 21st century organizations. The purpose of strategic corporate communication, particularly internal, is to create and distribute consistent messaging across departments that reinforce corporate objectives, enable a healthy flow of information and allows for promotion of the corporate brand. It is getting the right message through the right channel to the right audience at the right time and with the right effect. All too often, a true understanding of the value of the communications role and its place in an organization is lost, especially during times of upheaval and cost-cutting. Communicators are necessary and can be strategic leaders in an organization, helping the business succeed through messaging that is simple, relevant and repetitive, enabling associates to do their jobs and do them well.
A review of literature shows that as a society we have had an interest in the communications process for thousands of years (beginning with Aristotle) and though we have had all this time to understand and define it, experts acknowledge that there is still a struggle ensuring the intended message sent is the intended message being received. The constant evolution we face socially, technologically and economically along with varying levels of education and perception create a rapidly moving target when it comes to ‘understanding’. A ‘perfect’ communication strategy in the face of all this is improbable. The goal then must move toward improved communication and strategies.
A Communicator's Most Significant ChallengeThere is no more significant challenge facing the corporate communicator than that of showing in a clear and measurable way the
return on investment strategic, comprehensive, engaging and objectively-aligned communication offers to an organization. In a well-run business every functional area is expected to demonstrate how their efforts relate to the bottom-line and deliver ROI. Strategic communicators are no exception, but they face a higher challenge of quantifying the impact of their work, much of which is intangible, on the organization. Most organizations, even to this day use "soft" measurements such as employee awareness, understanding, and satisfaction to evaluate the success of their communication initiatives, programs, and channels.
Communicators must educate themselves and begin to employ the use of "hard" measurements like productivity, behavioral changes, employee turnover rates, and the reaching of business goals. These measurements are necessary because they link specific communication functions to tangible outcomes. This does not mean soft metrics are not still useful. Both “hard” and “soft” metrics are needed to show a holistic picture of communication in action within an organization. The linking of communication strategy and metrics to
business strategy is critical in an environment where every dollar counts.
Explaining the value of good communication in a way that executives can understand has to do with understanding and conquering two ‘powerful concepts’namely;
intangible assets and human capital. Intangible assets cannot be found on the books in terms of numbers and dollars. They include assets such as the brand, positive employee and community relations, loyal customers and an agile and engaged workforce. Results and findings showed that these factors have significant influence on profitability.
Fraser Likely is a public relations/communications professional who works as a consultant incorporating full scale
measurement programs. He is a member and regular contributor to the Institute of Public Relations in Canada. In his submission,
Performance Measurement: Can PR/Communication Contribute to the New Bottom Line of Intangible, Non-Financial Indicators? Likely lays out a series of considerations for the ‘new’ measurement of communication. Professional organizations across the fields of communications, public relations and media are beginning to sound the drum more and more insistently, that we need a new valuation system to measure the contribution of communication. The current one is clearly outdated.
Fraser Likely states that we can measure communication products, communication programs and organizational positioning through efficiency, effectiveness and cost-effectiveness (a combination of efficiency and effectiveness). Measuring communication products involves measuring inputs and throughputs for the effectiveness and efficiency, and thus productivity, of the production process. Measurement of the effectiveness of the delivery of outputs (for example distribution, reach and coverage) and measurement of the outtakes or impact of outputs for quality (attractiveness, accuracy, believability, etc. in the eyes of the receiver), audience recall/retention of the message, and finally audience attention or response to the communication product (did they pass it on to a friend, or did they go to a web site for more information).
A communication program is a collection of products with the same or similar messages aimed at the same target audience. The communication program should have objectives that are tied to relevant corporate objectives. Following that, the desired outcome for a communication program is generally a long-term effect; ‘collective changes in levels of awareness, knowledge, understanding, preference, attitudes, opinions and behaviors’. Rarely can one single communication product affect the desired level of change so there is need for message repetition, and a variety of communication products and channels that reach the intended audience repeatedly. Assessing effectiveness and recalibrating can be accomplished through a collection of measurement tracking tools, such as:
- "Pulse" surveys
- Focus groups
- Employee and/or management communication advisory teams
- Customer/client input
- Benchmarking and trend analysis
- Web usage data
- Event feedback and attendance data
- Readership data
When measuring the efficiency of a communication program, we look to project management, resource utilization and internal client satisfaction. By combining effectiveness and efficiency measures, we arrive at a cost-effectiveness measure. Finally, measuring the overall effectiveness of communication programs, their intended effect and actual effect can determine positioning measures like relationships, reputation and leadership. These effects and outputs generally show themselves as concepts like corporate reputation and organizational leadership organization-stakeholder relationships.
[this post is under edit]