new litmus test for communication
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Transcript of new litmus test for communication
W W W . W A T S O N W Y A T T . C O M
IABC/Charlotte
Communication: Overhead or Essential Service?
John FinneyCommunication ConsultantWatson Wyatt Worldwide
April 7, 2004
Presenting the results of the Communication ROI Study™
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Q: Pictured below are three lines and a circle representing a martini glass and an olive. What is the minimum number of lines you must move so that the olive is outside the glass?
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A: Zero. By viewing the glass from another angle, the olive is already outside the glass
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Inquiring Minds
By a show of hands…
Believe communication can positively impact the bottom line?
Think your CEO agrees?
How about your CFO?
Can tell me your company’s ROE?
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Facts and Figures
Inadequate employee communication wastes 14% of every 40-hour work week
(Office Team Survey 1999)
Less than a third of employees think their companies communication practices are effective
(Watson Wyatt 2000 WorkUSA Study)
Companies that share information about the business with employees show a four times greater return to shareholders
(Watson Wyatt 2002 WorkUSA study)
57% of communicators rely on informal feedback
(2003 IABC/Towers Perrin “Future Trends” Study)
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I Will Share:
The importance of measuring what we do
The latest Watson Wyatt research linking best practices in communication with higher shareholder value
Finney’s TOP TEN tips for value-added communication
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Key Messages
Information is the currency of business today Communication adds value to the bottom line! Some communication practices add more value
than others Engaging employees in the business and changing
behavior are key The term “business communicator” is not an
oxymoron—it’s an expectation! What gets measured gets done!
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“The greatest problem with communication is the illusion that it has been accomplished”
George Bernard Shaw
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What do we usually measure?
Did you receive the information?
Do the materials attract interest and attention?
Has the message been heard? Understood?
Is the message believable?
Are you satisfied with the information/change?
Is management “walking the talk” (in the eyes of employees)?
Access to/preferences for different media
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What should we measure?
Direct causal relationship between communication efforts and the bottom line
Alignment with strategic goals and objectives Whether employees are exhibiting desired
behaviors as a direct result of communication efforts
Factors that support or hinder communication effectiveness
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Business Case for Communication
Today everyone is charged with delivering critical business information to key constituencies.
CEO’s are coming to recognize the importance of a formal communication plan as part of an organization’s business strategy.
In the absence of a formal, business-focused communication plan – it is not surprising that few organizations ‘value’ communication as a strategic business function.
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High Performing Organizations are Getting the Message!
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About the Communication ROI Study™
Survey sent in April 2003 to approximately 5,000 heads ofHR and Communication
Fortune 1,000 and Pension& Investment 1,000 clients
267 companies responded Builds on results of
HCI/WorkUSA studies What specific communication
practices add the greatest shareholder value?
Industry # of Firms
Industrials 46Financials 43Health Care 41Consumer Discretionary 35Materials 23Information Technology 19Non-Profit/Univ/Hospitals 19Utilities 19Consumer Staples 17Energy 3Not Identified 2
TOTAL 267
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What we measured …
We defined an effective communication organization as one that excels at:
Providing individuals with financial information and objectives
Providing employees with information on the value of their compensation programs Engaging employees in the business Exhibiting strong leadership by management during organizational change Educating employees about organizational culture and values Explaining and promoting new programs and policies Integrating new employees into the organization Aligning employees’ actions with the customer
High
Top third
Medium
Middle third
Low
Bottom third
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What we found
Communication is a business functionthat directly links to bottom-line results
Communication effectiveness is associated with a 29.5% increase in
market value
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What we found
Communication is a business functionthat directly links to bottom-line results
Over the last fiveyears, firms with
better organizationalcommunication
earned shareholderreturns nearly 50%
higher compared to firms that
communicatedless effectively
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What we found
Communication is a business functionthat directly links to bottom-line results
Firms that communicate most effectively are more
likely to report turnover rates below or significantly below
those of their industry peers than organizations that communicate less
effectively (51.6% vs. 33.3%)
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The most effective communication goes beyond tactics and strategy to drive behavior change within the organization
What we found
KeyFinding!
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The way you measure communication effectiveness matters
Organizations that use “hard” measures, such as productivity, employee behavior change, turnover costs and achievement of business goals will have a positive impact on ROI
Organizations that use only“soft” measures, such asemployee awareness,understanding or satisfaction actually have a negative impact on ROI
What we foundKey
Finding!
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We found 9 communicationpractices that have a direct linkto increased shareholder value
Creating a clear line of sight between your business goals and employees’ jobs, changing leadership behavior and having a formal process provide the greatest return
What we found
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Awareness
Action
Understanding
Acceptance
Commitment
EFFECTIVECOMMUNICATION
DRIVESSUPERVISORS’/
MANAGERS’BEHAVIOR
CREATESEMPLOYEE
LINE OFSIGHT
FACILITATESCHANGE
FOCUSES ONCONTINUOUS
IMPROVEMENT
CONNECTSTO THE
BUSINESSSTRATEGY
FOLLOWS AFORMALPROCESS
USESEMPLOYEEFEEDBACK
INTEGRATESTOTAL
REWARDSLEVERAGES
TECHNOLOGY
BEHAVIORAL
STRATEGIC
FOUNDATION
Hierarchy of effective communication
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Finney’s Top 10 Finish
10. Determine if your communication practices are old school or new age
9. Increase your business acumen
8. Include “It’s Your Business” articles in company communication to improve line of sight
7. Attach a communication plan for key business decisions/changes
6. Be ‘hard’ on yourself and link your success measures to business outcomes
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Finney’s Top 10 Finish
5. Link changes to employee survey results—all year round.
4. Talk to a 14-year-old about your quarterly results/business goals
3. Train and reward managers for effective communication
2. Decide how you are going to behave differently to enhance your value to the organization
1. Focus on “outcomes” vs. “output”
W W W . W A T S O N W Y A T T . C O M
IABC/Charlotte
Communication: Overhead or Essential Service?
John FinneyCommunication ConsultantWatson Wyatt Worldwide
April 7, 2004
Presenting the results of the Communication ROI Study™