When I tell business leaders about Teresa Paulsen's communication value proposition, which succinctly states, "We either make money or save money," their immediate response is, "Where can I find a communication person who thinks like that?" A former client and now consultant, Paulsen says most communication professionals thrive on activity rather than producing business results, which she says puts them at risk. "No matter how much you do or how well you do it," she admonishes, "your contributions won't impact the bottom line, at least in a noticeable way. And if you're not making money or saving money, what is your role in a for-profit business? Overhead, that's what. Something to be reduced." Most internal communication functions are cost centers that should shift their work from churning out news and information to improving results and adding value. It's doable, but it requires thinking and acting more boldly and broadly than before. More and more communication professionals are doing just that. They start by redefining the business they're in---from an information distribution business to a results and value business.
Shift from tactical doer to strategic adviser
In many instances, the starting point is to adopt more of a strategic adviser role. Business leaders want help clarifying strategies, leading their thinking about the future, brainstorming, and understanding how they compare to others within and outside their industries. Strategic advisers who can make a positive impact on their business are a welcome resource. That's especially important when the results are greater than the cost of creating them.
Manage the communication system, not just the channels
Historically, internal communication managed formal channels: town hall meetings, newsletters, blogs, and social media, among others. But that's a tiny piece of an organization's communication system. Strategic advisers manage the entire communication system, not just a few of its parts. This system includes what leaders say and do, and what measurement, rewards, recognition and work processes communicate.
Measure what matters
Traditional communication functions tracked metrics like tweets, retweets, page views, readability and channel usage, to name a few. But these activities have little to no impact on your organization's success. If you want to get off the sidelines and influence what's important, try measuring against business objectives. Identifying and tracking measures like quality, productivity, on-time delivery, new product development cycle time, etc. helps to:
- Pinpoint where communication breakdowns cause under-performance.
- Identify root causes of the under-performance, so you can eliminate them.
- Improve results.
Build needed competencies
We expect communication departments to be good at writing, graphics and distributing news and information. But results- and value-focused communication pros spend most of the time on critical issues related to running the business, improving financial results, developing leaders and managing change. Assess whether your skills are more aligned with sitting on the sidelines, or helping your organization win the game. You may need to learn new things.
Shift from a cost center mentality to a value creation mindset
Shifting to a value-adding function requires four steps that successful communication practitioners are taking.
- Get your leaders on board. As Kristin Kelley, a former client who led a huge business improvement project for Owens Corning said, "Leaders want to make their numbers, so when our leaders saw others getting the kinds of performance gains we were able to help them generate, they wanted more of the same from us."
- Assess your current state. The best communication tool is the value-to-cost assessment that measures the importance of your communication activities, how well they're performing and what they cost. That assessment can tell you volumes about the productivity of your communication investment and where you should shift resources to get a better return.
- Build a business case with a value proposition that clarifies what you will and won't do. Consider Teresa Paulsen's value proposition. She made it very clear to her CEO that the function would not perform work that didn't make or save company money. Do you think her CEO objected?
- Improve critical business results in areas that matter to the business. Here are five critical questions that I ask of each of my clients who want to improve.
- Where are the best opportunities to improve performance by better managing communication?
- What's the size of the opportunity?
- What are the root causes of the under-performance?
- What will it cost to improve?
- Is the ROI acceptable?
This process gives you focus and launches you toward a big, first-time success. Do it again and again. You'll be in high demand. Here's how two practitioners made the shift from doers to strategic advisers.
The challenge: Financial literacy
Heather Sandoe, communication manager for an ITT manufacturing plant in Lancaster, Pennsylvania, understood that people needed more information about the business and how it works. The plant's primary measure was operating income (OI). However, few employees understood what OI was, how it was measured and most important, how they could influence it. Working with her finance department, Sandoe developed a business and financial management communication strategy that included the development of an OI "statement" describing the components and how each job and employee could affect it. She helped the plant create and implement financial literacy meetings that taught people how they could affect OI by using the information to make smarter decisions.
Opening the books enabled people to become more financially literate, which put more decision-making responsibility on the employees when choosing an action to take. On-time delivery increased 38 percent. Productivity increased 7.1 percent. Sandoe's ROI was 1,148 percent! The communication function went from a cost center to a function that helped dramatically improve results and value.
The challenge: Improving safety
When communication manager Dave Jackson was asked to improve safety at a ConAgra Foods facility that manufactured cooking spray, he brought the operations leaders and employees together to identify why the problem existed and develop a comprehensive plan for eliminating the root causes. He developed a comprehensive communication strategy focused on accident reduction. Working with the leadership team, Jackson helped identify specific positions within the company that leaders needed to address the safety issue. They then significantly adjusted incentive compensation to focus on accident reduction. Scoreboards and daily huddles throughout the plant focused on the importance of safety first, then quality and productivity.
The plant's total incident rate went from 10 to 2 within one year. Plant savings for workers compensation and lost productivity dropped by US$150,000. Dave used a similar approach to improve quality that generated another US$150,000 in the same year. Many other communication professionals are making the move to a results and value approach. They're getting results such as those generated by Kelley, Sandoe and Jackson, among others. For instance, in her first project with me, Kelley improved productivity by 8.5 percent while saving US$737,400 per year and generating a 700 percent ROI. In his first project, Scott Fiedler reduced truck freight claims paid at FedEx by 25 percent and reduced truck accidents by 54 percent. Bob Kula, vice president of communication at Kiewit, worked with me to reduce damage in a large distribution center by 65 percent while improving productivity by 16 percent. And Anna Roach, former director of internal communication at Earthgrains/Sara Lee, improved yield in a Chicago bakery by 8 percent. "I started the process by telling my CEO that I wanted our function to contribute more value to the company," Anna said. "He then asked me to get the entire leadership team involved. After the success of our first project, internal communication began to add more value and gain a newfound respect."