W A T S O N W Y A T T

L I N K I N G C O M M U N I C A T I O N S W I T H S T R A T E G Y T O A C H I E V E B U S I N E S S G O A L S

1999 COMMUNICATIONS STUDY

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At work, we are bombarded with hun-dreds of messages and bits of informationevery day — some of it useful, but muchof it not relevant to us. The volume ofthese communications only seems toincrease. Amidst all of this “noise,” howcan organizations communicate effectivelywith employees? How can professionalcommunicators ensure that employeesreceive and act on the truly importantinformation they need to perform success-fully? And, how can organizations moreeffectively “listen” to their employees?

In today’s ever-changing business environment, communicators face the complex challenges of developingtechniques and processes to manageinformation and distribute it in ways thatenhance the intellectual capital of theirorganizations. To meet these challenges,communicators and senior managementmust work to establish proactive,

well-defined communications strategiesthat engage the workforce and alignclosely with the organization’s businessgoals. A close tie between business andcommunications strategies will help theworkforce understand and support thedirection of the organization.

This study offers evidence that an organization’s communications planningand programming are critical factors contributing to the success of its business strategy. Study results identify a definitecorrelation between high-performingorganizations and strong communicationpractices. Respondents agree that com-prehensive communications programshelp motivate and align employees withthe goals of their organization. The studyalso establishes basic guidelines to helporganizations create a successful commu-nications program based on the practicesof high-performing companies.

INTRODUCTION

A C L O S E T I E between bus iness and communicat ions s t ra teg ies

wi l l a l i gn the work fo r ce w i th the d i r ec t ion

and changes o f the o r gan i za t ion .

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Watson Wyatt Worldwide, in cooperationwith the International Association ofBusiness Communicators (IABC) and theIABC Research Foundation, examined thecurrent state of employee communicationsin a variety of organizations. This study isthe latest in a series of five communica-tions studies conducted by Watson Wyattsince 1986.

A total of 913 organizations participated in the study, representing a variety ofindustries and positions within thoseorganizations. The largest industry segment represented was manufacturing.Communications professionals constitutedthe largest functional segment respondingto the study. Almost half the participantsrepresented organizations with 5,000 ormore employees.

ABOUT THE STUDY

P A R T I C I P A N T S by o r gan i za t ion s i ze

1,000 to 4,999 Employees 27%

Under 1,000 Employees26%

5,000 or MoreEmployees

47%

Manufacturing 22%

Banking/Insurance/Finance 20%

Health Care 10%

Information Technology/Electronic

Communications/Health Sciences 7%

Utilities 7%

Services 5%

Retail/Wholesale 4%

Transportation 4%

Other 21%

P A R T I C I P A N T S by indust r y segment

❚ Fifty-one percent of high-performingorganizations have well-definedcommunications strategies that allow employees to betterunderstand their organization’sbusiness goals.

❚ Fifty-two percent of senior man-agers recognize and support theimportance of strong corporatecommunications programming inachieving their business strategies.

❚ Seventy-one percent of senior managers actively integrate communications into their overallbusiness strategy.

❚ Long-range communications plan-ning and measurement are still lacking at many organizationsdespite a 50 percent increase overthe past four years in the number oforganizations with formal employeecommunications strategies.

❚ The communications function istransitioning from HR and indi-vidual operating units (22 percent)to corporate communicationsdepartments (46 percent).

❚ Participants cite e-mail as the mostfrequently used communicationstool (90 percent), but not the mosteffective (55 percent).

STUDY HIGHLIGHTS

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As with any business function, a well-defined strategy can be the differencebetween success and failure. Employeecommunications is no different. A com-munications strategy is critical in businessenvironments with a constant stream ofnew product introductions, shortenedproduction cycles and continuous organiza-tional change. A focused communicationsstrategy both facilitates upward commu-nication and helps employees receive andunderstand the proper information at theright time. We asked study participantsabout the use of communication strate-gies within their organizations.

THINK STRATEGICALLY

Explaining New Programs in the Organization 68%

Helping Employees Understand Business Goals 67%

Education About Organization Values and Culture 56%

Informing Employees of Organization Performance Issues 38%

Providing Information and Feedback to Motivate

and Improve Job Performance 31%

F I G U R E 4 : What does your communicat ions s t ra tegy inc lude?

Yes

No 57%

F I G U R E 1 : Do you have a fo r mal employeecommunicat ions s t ra tegy?

43%

Agree

Disagree

Neutral

40%

27%

F I G U R E 2 : Does sen io r management base communicat ions on a we l l -de f ined s t ra tegy?

33%

Proactive

Reactive 42%

F I G U R E 3 : In what manner a re your communicat ions p rograms deve loped?

58%

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In recent years, business trends havedemonstrated to organizations that afocused business strategy is one of the keyelements to create sustainable competitiveadvantage. And to make any businessstrategy work, you need a workforce thatis aligned with the goals and direction of its organization. While various combi-nations of compensation, training andincentive programs have been proven tohelp engage and align the workforce, they cannot be effective without a com-munications program that explains theirvalue and solicits employee buy-in.

LINK COMMUNICATIONS AND BUSINESS STRATEGY

Agree

Disagree 29%

F I G U R E 5 : Are your communicat ionsob jec t i ves d i r ec t l y l inked to yourbus iness ob jec t i ves?

71%

Agree

Disagree

Neutral

26%

21%

F I G U R E 7 : Does sen io r managementt ie communicat ion in i t ia t i ves to corpora te bus iness ob jec t i ves?

53%

Agree

Disagree

Neutral

44%

30%

F I G U R E 6 : Does sen io r managementrecogn ize communicat ions as a keye lement to bus iness success?

26%

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Can relocating the communications func-tion help improve the effectiveness oforganizational communication? In our1994 study, human resources was themost common area to house the internalcommunications function (33 percent),and a corporate communications depart-ment ran a close second (29 percent).This year’s study showed a significantswing in the location of the communica-tions function.

Results show there has been a movementof the employee communications functionout of human resources and operatingunits and into a corporate communica-tions department. This probably reflectsthe need to ensure both consistent messages and quality along with the centralization of functions to best utilizethe organization’s resources. But moreimportantly, this movement recognizes the strategic nature of communications.

LOCATION, LOCATION, LOCATION

Electronic Mail

Ongoing Publications for All Employees

Group Meetings

55%

F I G U R E 8 : Communicat ions med ia — popu la r i t y vs . e f fec t i veness

Most Frequently Used Media

Most Effective Media

90%

70%89%

60%89%

What could be more appealing thaninstant communication at the click of abutton? The popularity of e-mail inrecent years has dramatically affectedboth personal and business communi-cations. Our study participants cited e-mail as the most frequently usedmedium for employee communications.Although e-mail’s popularity jumped37 percent since our last study in 1994,its relatively low effectiveness rating(55 percent) shows that it is not amagic communications pill for organi-zations. Employees can receive a signif-icant number of e-mails each day, bothbusiness and personal. With all of thee-mail “clutter,” an organization can-not be sure that its employees are reallytaking the time to process and under-stand their electronic messages.

According to People ManagementResources’ Best Practices Guide forEmployee Communications, bestpractice organizations report a highrate of success in getting the rightmessages to their employees by usinga focused strategy that combines athoughtful mix of these communica-tion methods and tools. This mixincludes in-person meetings, printednewsletters, Intranets, open-door policies and e-mail.

So while the lure of e-mail and masscommunication can be attractive, it can also be deceiving. Organizationsshould evaluate what communica-tions methods, or combination ofmethods, is the most effective inreaching their employee population.

CUTTING THROUGH THE CLUTTER

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With the growing centralization of thecommunications function, the strategicrole of the communicator can be expectedto increase. We asked study participantsabout their organizations’ views on therole of professional communicators.

When asked more specifically about thesenior communications professional’s rolein the organization’s major initiatives, 44 percent of participants indicated thattheir organizations involved communica-tions and communicated to employeesafter decisions are made. More than one-third (38 percent) reported that thesenior communications professional givesadvice and counsel on communicationsaspects of major organization initiativesbefore decisions are finalized, and 18 per-cent noted that the senior communicatorhas an ongoing role in communicationsstrategy development.

Implementers

Strategic Planners 39%

F I G U R E 1 0 : How does sen io r managementw i th in your o r gan i za t ion v iew the ro le o fcommunicat ions p ro fess iona ls?

61%

Implementers

Strategic Planners 46%

F I G U R E 1 1 : How do s tudy par t i c ipants v iewthe ro le o f communicat ions p ro fess iona ls?

54%

Corporate Communications 46%

Human Resources 22%

Marketing/Public Relations 18%

Operating Units 5%

Other 9%

F I G U R E 9 : Area o f r espons ib i l i t y fo rcommunicat ions funct ion

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Participants in the Watson Wyatt/IABCCommunications Study were asked to ratetheir organization’s financial performancefor 1996, 1997 and 1998. Participantswho rated their organization’s financialperformance as excellent for all three years were identified as coming from high-performing organizations. These participants represented 27 percent of ourtotal survey sample. Responses from par-ticipants in high-performing organizations

were compared to responses from all otherparticipants to identify the key differencesin communications.

Communications professionals in high-

performing organizations play a strategic

role. Senior executives in high-performingorganizations view their communicationsprofessionals more as strategic businessplanners than as implementers. Seniorcommunications professionals in high-performing organizations are morelikely to provide advice and counsel oncommunication issues before decisionson major initiatives are made than inother organizations (see Figure 14).

High-performing organizations do a bet-

ter job of explaining change. Half therespondents from high-performing orga-nizations were satisfied or very satisfiedwith the effectiveness of their downwardcommunications programs in explainingand promoting major changes comparedto 39 percent of respondents from allother organizations.

O R G A N I Z A T I O N S T H A T S T A N D O U T

High-Performing Organizations

All Other Organizations

F I G U R E 1 2 : High -per fo r ming o r gan i za t ionshave fo r mal communicat ions s t ra teg iesmore o f ten than o ther o r gan i za t ions.

40%

51%

High-Performing Organizations

All Other Organizations

F I G U R E 1 3 : High-per forming organizations measurethe ef fectiveness of their communications programsmore often than other organizations.

17%

29%

Senior Management Views CommunicationsProfessionals as Strategic Business Planners 43% 37%

Senior Communications Professionals Give Advice and Counsel Before Major Decisions Are Made 43% 37%

F I G U R E 1 4 : St ra teg ic r o le o f communicat ionspro fess iona ls in the o r gan i za t ion

High-Performing Organizations

All OtherOrganizations

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Helping Employees Understand the Business 77% 64%

Educating Employees About the Organization’s Values and Culture 65% 54%

Informing Employees About the Organization’s Progress Toward Business Objectives 65% 59%

Providing Feedback to Employees to Motivate and Help Them Improve Job Performance 33% 30%

F I G U R E 1 5 : Emphas is in communicat ions p rograms

High-Performing Organizations

Ver y s t r ong o r s t r ong emphas is on. . .

All OtherOrganizations

Channels for Upward Communication Are Excellent or Good 38% 25%

Information Gained From Upward Communication Is Used as Input Before Major Decisions Are Made 33% 26%

F I G U R E 1 6 : Upward communicat ions in o r gan i za t ions

High-Performing Organizations

All OtherOrganizations

Overall Organization Goals 72% 57%

How Their Work Contributes to Achieving Organization Goals 51% 41%

The Skill Sets Needed to Be Productive 55% 48%

The Means Used to Evaluate Their Performance 51% 48%

F I G U R E 1 7 : Employees’ unders tand ing o f o r gan i za t iongoa ls and the i r r o le in ach iev ing goa ls

High-Performing Organizations

All OtherOrganizations

Employees have a good unders tand ing o f . . .

High-performing organizations focus on

communicating with and educating their

employees. Communications programs in high-performing organizations place agreater emphasis on helping employeesunderstand their business, its values andculture, its progress toward goals andhow employees can improve performance(see Figure 15). These organizations pro-vide their employees with comprehensiveinformation, from broad organizationaldata to specific and personalized messages.

High-performing organizations provide

channels for upward communication and

listen to what employees say. Morerespondents from high-performing orga-nizations than from all others rated theirchannels of upward communication aseffective and reported that employeeinput was used in decision making (seeFigure 16).

Employees in high-performing organiza-tions have a better understanding oforganizational goals and their part inachieving them. This understanding

includes how employees’ work con-tributes to goals, what skill sets they needto be productive and how their perfor-mance is measured (see Figure 17).

These findings correlate with WatsonWyatt’s 1997 WorkUSA® research — a survey of more than 9,144 workingAmericans’ opinions — where employeesin growing companies reported a betterunderstanding of their organization’sgoals, the steps needed to reach thosegoals, the skills they need to be successful and an understanding of how their per-formance was evaluated.

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T H E T E N C H A R A C T E R I S T I C S of E f fec t i ve Communicat ions

One goal of this study was to identify the special traits possessed by organi-zations that have successful communication programs. We identified thesetraits using a comparative index of successful communications policies, programs and behaviors from various organizations. The following is a listof characteristics for any organization to examine and consider.

1. Senior management must recognize the importance of communicationsin achieving business objectives.

2. Senior management should base all communication efforts on a clear,well-defined communications strategy.

3. Senior managers must tie communications initiatives to corporate business objectives.

4. The organization should provide information to employees about howthe firm is doing in meeting its goals.

5. Communications programs must be developed proactively rather than reactively.

6. Employee communications programs must place a strong emphasis on helping employees understand the business.

7. The organization should have a well-defined, two-way communications philosophy.

8. A comprehensive communications program should be an essentialpart of the organization’s business strategy.

9. Managers at all levels should be rewarded for communicating effectively.

10. Employee communications programs must place a strong emphasison providing information and feedback to motivate and improve job performance.

What is striking about these characteristics — and instructive for profes-sional communicators — is the integration of communications into overallbusiness strategy by and with senior management. In organizations with successful communications programs, senior management clearly has taken the time to plan, identify and support communications strategies and philosophies that grow from the organization’s business objectives.

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How do you know your employeesunderstand your organization’s messagesand business goals? When you measureyour communications programs, you canevaluate program effectiveness and gaugethe value gained by your organization.We asked study participants about therole of measurement in their overall communications strategy. Results indicatethat organizations do not measure theeffectiveness of their communicationsprograms as often as they should.

ENSURING SUCCESS

Ongoing

Once a Year

Ad Hoc

No Formal Measurement

F I G U R E 1 8 : How of ten is communicat ion e f fec t i veness measured?

No Formal Technique

Audit

Employee Survey

Management Judgment

Objective Measures of Changed Behavior

F I G U R E 1 9 : What a re the most common measurement techn iques?

26%

31%

51%

40%

15%

28%

34%

17%

21%

Yes

No

Neutral

63%

28%

F I G U R E 2 0 : Are managers rewarded fo r e f fec t i ve communicat ions?

9%

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Global market challenges and the constant change facing organizationstoday make effective communications a critical component for long-term success. Market volatility, changingbusiness strategies and a variety of competitive forces can create extremedisconnects between the goals of the organization and the direction of employees. To succeed in such an unforgiving environment, it is essentialthat organizations:

❚ Create an integrated, long-term

communications program —

Study results show that successfulorganizations have well-defined communications philosophies and formal communications strategies: philosophies that includetwo-way communications that help to shape the decisions of the organization.

❚ Link their communications efforts

to their business objectives —

The success of internal communica-tions programs comes from a clear and unwavering focus on theorganization’s business objectives and the role employees play to helpachieve those objectives.

❚ Ensure that employees understand

their organization’s business goals

and what is needed for success —

The study’s high-performing companieshave a greater percentage of employeeswho clearly understand the overallgoals of their organization and theskills that they need to be successful.

❚ Allow professional communicators a

more strategic role in their organization

— While it is clear that high-performingorganizations tend to view communica-tions professionals more as strategicbusiness planners, more than half of all study participants view them only as implementers.

❚ Measure your communication efforts

to better manage them — Measuringyour communications program helpsyou understand what components work.By not measuring your program’s effec-tiveness, you can waste time, moneyand, more important, the connectionwith your workforce.

In this information age, with growingnumbers of knowledge workers, it iscritical to organizational success thatcommunications inform, involve andengage the workforce.

CONCLUSION

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A B O U T W A T S O N W Y A T T W O R L D W I D E

A global consulting firm, Watson Wyatt brings together two

disciplines — people and financial management — to help

clients improve business performance.

We structure cost-effective compensation and benefits pro-

grams that help companies attract, retain and motivate a

talented workforce. We help clients achieve competitive advan-

tage by aligning that workforce with their business strategy.

And we help them use technology to reduce costs and improve

employee service.

Our collaborative consulting approach starts with ClientFirst™

— where we work with clients to define needs and expecta-

tions and then measure our performance according to these

agreed standards. Building on our research-based innovation

and a deep knowledge of our clients’ businesses, we partner

with them to provide tailored solutions.

Watson Wyatt has more than 5,000 associates in 36 coun-

tries. They are backed by the best and most current research

on people and financial management issues. Corporate offices

are in Reigate, England, and Bethesda, Md., USA.

T O D I S C O V E R how to align your company’s communications

with your business strategy, please call 1-800-388-9868or visit us at www.watsonwyatt.com.

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Copyright © 1999, Watson Wyatt Worldwide.

All rights reserved. Catalog #W-252.

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