Assessing the value of communication: a special report from the IABC Research Foundation and Watson Wyatt Worldwide

Communication World, Jan-Feb, 2004

Where does your communication budget fall in your CFO's ledger: the "cost of doing business" column, or the dreaded "expenses" column? In today's cost-conscious business environment, communicators must demonstrate ROI for communication--or risk redlining by accountants. The IABC Research Foundation convened a panel of top communication executives to analyze the value communication delivers to organizations, and to identify best practices for measuring that value and articulating it in a way senior management can understand. Following is a report of principal findings from that panel discussion.

RECOGNITION AT LAST: THE STRATEGIC VALUE OF COMMUNICATION

Moderator: How have you seen your business change in the last five years, and what impact has that had on the way you communicate today?

Julie Bjorkman Chughtai, ABC, APR: This position at DePaul is my fifth start-up of a similar function. and it's all been in internal communication. It is surprising to me that there are so many organizations out there that still need to focus on internal communication and don't. The good news is that more organizations are taking internal communication seriously--and see strategic communication as a key to engaging employees and achieving success.

Matt Gonring: I'd like to reinforce that. The most significant thing that has happened in my experience over the last five years is that, in spite of the economy, the function of employee and internal communication has become an established management discipline in the companies where I have worked. We came from a time when employee communication was a bit of an afterthought, and a bit one-way. Now it's a dynamic two-way process that is recognized by senior management as a critical dimension of managing the enterprise, engaging the workforce in being a part of change and the overall strategic direction of the company. The focus of the internal communication function has shifted from pursuing outputs to achieving outcomes--and that is a significant step forward.

Kori Reed: Technology has played a role. Early in my career, I was the gatekeeper; everything came through me. With the advent of the Internet, everyone is a communicator. And I think that is part of the reason people now understand that communication is an important strategic part of the business.

Tim Penn: In recent years, management has started looking at communication and saying, "Oh, there is something we can learn from this to effect change." Then communicators started saying, "What can we learn from management?" They can learn the value of communication from us, and we can learn from the engineers and the accountants how best to measure our contribution to the business. As someone once said to me, you can't manage what you can't measure.

PROVING OUR WORTH: QUALITATIVE VERSUS QUANTITATIVE METRICS

Moderator: We [at Watson Wyatt] recently completed a study on the ROI of communication. We asked the heads of communication and human resources at Fortune 1000 companies, Pension and Investment 1000 companies and other organizations of comparable size to complete a comprehensive survey of their communication practices. We identified best practices that linked directly to an organization's communication effectiveness. One of our key findings was that most organizations are still relying on "soft" measures--such as awareness, understanding and satisfaction to evaluate the success of their communication initiatives. Although few organizations are using "hard" measures--such as productivity, turnover, employee behavior change and achievement of business goals--those that are using these measures are experiencing a positive impact on the bottom line. How do you measure the success of your communication programs?

Peg Wander: We find that folks at a higher level often have a good deal of understanding of the importance of internal communication, and those at a lower level do not. But it's good to recognize that disconnect and then be able to act on that. The only way you do that is by taking the time to measure and ask what people know. I'm actually pleased if somebody says, "You're doing business differently," even if they're upset about it, because that's what I'm hoping they will say. You have to set the goal originally, ask the question and act on the response.

TP: I still think there's great value in continuing to do communication surveys and employee attitude surveys, but I'm getting my hands around the electronic information you can get from your web site. In the beginning, we looked at individual page views and stickiness; we wanted people to visit a particular page for a certain amount of time. Then we went to click-through analyses of where they went on the site, how they got there, where they took action. Then came usability: Can people find information? Now, the next wave is web utility: Visitors got there, but did they do anything once they got there? And are they doing the right things to advance our business? It is quantitative, but you can put some thinking behind it and add real qualitative insight.