Proving the value of internal communication

Proving the value of internal communication

Q: How do you justify the expense of internal communication when there has been little impact on the bottom line? In other words, how do you defend your budget in the face of unimpressive business results?

A: Houston Spence
I'm in the telecoms industry. Even if my company had the best internal communication and most performance-oriented corporate culture, our revenues, credit rating and stock price would still be in the toilet right now, along with all our competitors. For years I thought the communication professional's holy grail was something like a "Communications ROI". I still think it's a fun idea, but I've become skeptical about it too. Even if internal communication adds value to the business, that value might fail to show up on the bottom line in any traceable form. It doesn't generate revenue. It doesn't lower costs. It's an enabler. It can enable initiatives that generate revenue. It can enable initiatives that lower costs. But it might not do either.

Still, I don't think we should give up and let nature take its course. The benefits of good internal communication are clearly measurable, they're just not clearly measurable on the bottom line. We've got to make the case for our value (and our budgets) in other ways. One way is to draw the logical case that better internal communications, down the line, improves senior executives' ability to direct the activities of the enterprise. That impact is measurable. Another argument is about employee satisfaction and retention. That is also measurable.

There are other examples, the most powerful being the ultimate impact of internal communications on customers. We've got many ways to measure the value of our work, but the bottom line probably isn't one of them.

A: Simon Bottery
I agree with the scepticism. More provocatively perhaps, I wonder whether we're making the mistake of turning an abstract concept (communication) into a real thing and then looking for a (non-existent) way of measuring and valuing it. If communication is 'an act of the receiver' then it's not the thing you do that constitutes communication but the state of mind it creates, like 'happiness' or 'fear'. Both of these probably have an impact on the bottom line as well but try measuring them.

A: David Kirchhoffer
I think the key is to define in advance the objective of any communication in line with strategic business objectives. For example, when advertising burgers our strategic business objective is to increase sales. Therefore, the objective of the communication is to make consumers buy more burgers. Knowing this in advance makes it easier to declare the success or failure of a campaign.

In the slightly more complex world of internal communications, if the business decrees that it is strategically desirable to create a culture that encourages honesty, then the objective of the communicator is to change people's behavior by making them more honest. One could measure the success of a campaign by monitoring the levels of internal fraud, for example. Measure the behavior that the communication is intended to create or change. Then you'll know if your communication is effective. How those behaviors impact on the bottom line is irrelevant to the communicator. The business leadership believes that such a behavior is beneficial for whatever reason. So be it.