got the message - businesses should keep employees informed

HR Magazine, April, 2001 by Lin Grensing-Pophal

HR needs to measure the impact of employee communication.

When Shaw's Supermarkets acquired another company, rumors ran rampant. How many stores would be closed? How many people would be laid off?

Controlling the rumor mill is never easy, especially for a company with 32,000 employees in seven New England states. The solution: introduction of The Rumor Buster, a newsletter published on an as-needed--but at least weekly--basis during the merger, says Ruth Bramson, senior vice president of human resources in East Bridgewater, Mass.

"Communication is the major stumbling block to a successful merger," says Bramson. The Rumor Buster "addressed whatever horrendous rumors were going around at the moment. We found it to be an incredibly successful tool."

HR discovered just how useful the newsletter was when employees of the newly acquired company were polled; they indicated that the newsletter had been an important and positive part of the integration. "They told us they looked forward to getting The Rumor Buster because it focused on the things they were worried about," Bramson says.

Employee feedback about how well you are communicating to employees may be just as helpful when it comes to improving other company services. When a client company of Angela Sinickas wanted to determine whether its open enrollment packet was effective, Sinickas, president of Sinickas Communications Inc., in Costa Mesa, Calif., and a widely recognized authority on communication measurement, was asked to test the packet's effectiveness. She conducted employee focus groups three weeks after open enrollment ended using a technique based on the Starch test, an advertising research technique for unaided and aided recall of messages. Participants were asked if they remembered the package and its contents.

"We took them through the entire package, section by section," Sinickas says. The knowledge gained through this process, including where more detail was needed and where less detail would improve understanding, was used to plan the next year's open enrollment package.

"An organization needs to regularly communicate to enable employees to feel engaged, to feel valued, to seek their input, to keep them aware and to enable them to manage their jobs," says Brian Lowenthal, director at Hackett Benchmarking & Research, part of Answerthink Inc., an eBusiness consulting firm in Cleveland. He adds that those communication efforts need to be strategic. The measurement of communication, Lowenthal says, "is key for organizational effectiveness and employee satisfaction."

Communication as a Strategic Imperative

Effective communication within an organization can lead to a more engaged, loyal workforce, although Lowenthal doesn't believe that employee communication is necessarily more of a strategic imperative today than it has been in the past.

"The circumstances and conditions that organizations face today create a sense of urgency now that wasn't there before," he says. "When you have the employment picture we have, with record unemployment, if people don't feel engaged or connected with the organization they work for, they're going to go elsewhere."

Nick Burkholder, vice president of staffing assessments and solutions at Bernard Hodes Group, an HR communications company in New York, agrees. Communication is "even more critical now as our organizations face these incredible staffing challenges," he says. "There are a lot of indications that employee communication programs can have a direct impact on recruiting, development and retention and, I believe, on productivity too."

Kathryn Yates, a senior communications consultant at Watson Wyatt & Co. in Chicago has evidence of that impact. She points to Watson Wyatt's Human Capital Index (HCI), which shows a relationship between the effectiveness of a company's human capital and the creation of high share holder returns. Companies with a high HCI have high shareholder value; companies with a low HCI have low shareholder value.

Watson Wyatt's research of more than 400 U.S.- and Canada-based publicly traded companies found links between communications integrity and value creation in the following situations. (The figure in parentheses is the expected change in market value associated with a significant improvement in HCI.)

* Employees have easy access to technologies for communicating (1.8 percent).

* Employees have the opportunity to give ideas and suggestions to senior managers (0.8 percent).

* Financial information is shared with employees (0.8 percent).

* Employees have input into how the work gets done (0.4 percent).

* Business plans and goals are shared with employees (0.2 percent).

Yet, despite the value associated with effective employee communication, Lowenthal and others admit that few "companies today would get high marks in employee communication."

The Role of HR in Communication Measurement

HR can make a difference in the effectiveness of employer-employee communication. While the HR function is not always directly aligned with the communication function in an organization, HR professionals have a vested interest in its success.