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The Cost of Poor Communication is High

Posted by EmployeeChannel on 11.16.2017



“The single biggest problem in communication is the illusion that it has taken place.”—George Bernard Shaw

The problem that Shaw so cogently points out is the very challenge we face today in internal or employee communications.

A host of communicators, including HR and internal communications professionals as well as line managers, are messaging employees frequently on a host of topics ranging from the organization’s vision and mission to benefit programs to project updates. However, effective communication is not happening consistently.

And, poor communication is exacting a high price in organizations of all sizes.

  • The top three reasons why people do not like their jobs are communication related: lack of direction from management, poor communication overall, and constant change that is not well communicated. (2014 survey from About.com)
  • A survey of 400 companies with 100,000 employees each cited an average loss per company of $62.4 million per year because of inadequate communication to and between employees. (David Grossman, “The Cost of Poor Communications,” The Holmes Report, July 17, 2011.)
  • A business with 100 employees spends an average downtime of 17 hours a week clarifying communication, translating to an annual cost of $528,443. Seventy percent of small to mid-size businesses claim that ineffective communication is their primary problem. (HRDQ)

On the other hand, there is a compelling relationship between effective communication and a strong financial performance.

  • Companies with highly effective communicators have had a 47 percent higher total return to shareholders compared to the least effective communicators. (Towers Watson)
  • Businesses with effective communication practices are over 50 percent more likely to report employee turnover levels below the industry average. (Watson Wyatt)
  • Companies with highly effective communications are three and a half times more likely to significantly outperform their industry peers than firms that are not effective. (Towers Watson 2013-2014 Change and Communication ROI Study Report)

The negative impact of poor internal communications demands that we strip away the illusion that communication has taken place and that we know that the right message is reaching the right employee at the right time.

So what are some of the keys to communicating more effectively?

  • Begin by tying internal communications to the organization’s strategic initiatives so that the organization has consistent and disciplined messaging throughout the year.
  • Segment employees into meaningful teams and target them with personally relevant messages that resonate with each team.
  • Provide managers with tools that enable them to create more purpose-driven messages and to communicate the “big picture” effectively.
  • Implement feedback tools for ‘continuous listening’ so that the organization and managers understand how effectively they are communicating and how their employees are responding.
  • Provide conversational, intelligent, and on-demand content that lets employees get questions answered, find information, and provide feedback without human assistance.
  • Select the best communication channel to reach employees wherever they are—a mobile channel.


Topics: employee communication

Human Resources Today