Strategy: Costs of Poor Communication

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Every year, my business communication students would graduate and enter the workforce only to report back that while they didn’t understand the importance of the business communication, they now wish everyone took one. Each student indicated that they have a great deal of trouble communicating with their colleagues and clients, because deliverables are often vague, jargon filled and confusing.

The ability to communicate with another person is the connection, the glue, the putty, the staples, that holds a company together. Poor communication in the workplace is costly in terms of money, time, and reputation. My students who came back to report on their problems with communicating were picking up on an important facet of the problem. While college graduates often take workplace communication courses, there is a huge divide between knowing how to write and actually writing to a real person to convey a specific concept. A classroom environment cannot fully bridge that gap and the divide is not always conquered through experience in the workplace. To compensate, companies can do a number of things: hire an experienced communication specialist, bring in a communication trainer, and develop and utilize a communication strategy.

Scope of the Problem

Poor internal communication derails companies and the costs are staggering. Global workplace studies reveal that, because of ineffective interpersonal communication, small and medium-sized businesses lose about 17.5 hours of productivity per employee per week, or $5,246 per employee per year.*

  • “David Grossman reported in “The Cost of Poor Communications” that 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” (Buhler and Worden).
  •  In “Top Ten Email Blunders that Cost Companies Money,” Debra Hamilton argued that “miscommunication cost even smaller companies of 100 employees an average of $420,000 per year” (Buhler and Worden; Hamilton)
  • 86% of employees and executives cite lack of collaboration or ineffective communication for workplace failures.
  • Businesses with effective communication are 50% more likely to have lower employee turnover.
  • 27% of employees who plan to leave within the first year cite feeling “disconnected” to the organization.
  • Only 5.9% of companies communicate goals daily. (ClearCompany)

Large corporations host entire departments to facilitate corporate communication, while small to medium-sized businesses are often left to fend for themselves. These smaller businesses may need help developing communication strategies, producing external deliverables, organizing internal communication practices, or preparing for pitches or presentations.

Communication Strategy

To develop a business communication strategy, a company would need to consider the following concerns:

Identify Company Goals. While a company may know what their general business goals are such as ‘make money,’ communication goals need to be developed too. In some ways, these communication goals can be associated with branding. Branding establishes a company’s persona, the voice of the company. What kind of personality should the company have? Professional? Creative? Innovative? Techy? However, persona and branding are not the only ways to create company communication goals. The question is not just what should be conveyed to audiences, but who are the audiences and how should dialogued be established?

Audience. A good communicator speaks to SOMEONE. This sounds like an obvious comment; it isn’t.

Question: Who is your audience?

Answer: Everyone.

Incredulous: Everyone?? Really? Everyone in the World? Everyone, men, women, children, all sexual identities, all personalities, all locations..etc…they ALL want your service or produce? Not a chance. Even “global” entities have specific audiences. Think about it. Coca Cola is a great example. The formula changes by country. The marketing has to change or problems come up. And, even the geolocation of the product has a profound impact on how people respond.

By establishing a brand and communication strategy, a company can more easily establish what they are trying to achieve, determine who should take responsibility, and dialogue with their stakeholders. Fix your company’s communication; save your company immense amounts of money and time.

Resources

Buhler, Patricia M.  and Joel D. Worden, Up, Down, and Sideways: High-Impact Verbal Communication for HR Professionals (SHRM, 2013).

Clear Company. https://blog.clearcompany.com/7-workplace-collaboration-statistics-that-will-have-you-knocking-down-cubicles

“Connecting Organizational Communication to Financial Performance – 2003/2004 Communication ROI Study” (2003). Watson Wyatt & Company, 3 November 2003.

Crumlish, Kimber. “5 Reasons Your Employees Stay”.  Visibility Software. 29 Apr 2014.

Hamilton, Debra. “Top Ten Email Blunders that Cost Companies Money,” Creative Communications and Training, Inc. Special Edition. 2010. www.businesslunchandlearn.com

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