Employee engagement

Employees are more effective when
they understand the business and how
their individual performance contributes to achieving the company’s objectives. That’s the findings of a recently
updated communication study conducted
by Watson Wyatt Worldwide. The goal of
the study was to identify which communication practices deliver the best return on
investment (ROI). Among the 335 participants surveyed, 60 percent worked in global organizations. Given the trend toward
globally diverse companies, executives
must now communicate across a broad
spectrum of culturally diverse employees
to drive higher corporate returns.

“Organizations are more global than they
have ever been,” says Lisa O’Driscoll, San
Francisco’s communications practice
leader with Watson Wyatt Worldwide. “The
communication effectiveness of a global
company is often dependent on the company’s ability to understand the different
cultural contexts and reference points
within the employee population.”

Smart Business spoke with O’Driscoll
about how executives can communicate
effectively across a culturally diverse staff.

How does executive communication play a
role in engaging employees and driving ROI?

Despite conventional wisdom that immediate supervisors play a role in driving
retention and engagement, strong senior
leaders who communicate effectively and
frequently are a more important factor.
We’ve found that highly engaged employees receive communication from senior
management far more frequently than less-engaged employees.

How can executives communicate effectively
across a global organization?

No matter what their location across the
globe, committed employees are proud to
work for their companies and motivated to
help drive success. Commitment is essential to retaining high-quality employees and
delivering long-term financial success, but
commitment alone is not enough.
Employees also need focus and direction,
something that Watson Wyatt calls ‘line of
sight.’ Simply stated, creating line of sight
between executives and employees means
communicating in ways that allow employees to understand the organization’s business goals, the steps that must be taken to achieve those goals and how they can contribute to achieving these goals.

How can CEOs create a line-of-sight communications plan?

For U.S. companies, communication is
often northern-America-centric, so executives must adjust by starting the conversation with an employee value proposition
tailored to all employees globally, not just
those in the home country. Senior management and mid-management should trained
on effective communication techniques
and managing multicultural and multi-country teams. A global communication
strategy should align the firm’s business
objectives with the employee value proposition while providing the platform for
localization that reflect different cultures
and local business conditions.

In all cases, companies need to develop a
sustainable communications strategy that
supports their mission, aligns employees
with the business strategy and allows them
to understand their role.

What elements comprise an effective line-of-sight communications plan?

First, no one strategy fits all companies,
so each needs to decide what type of company it wants to be and how that supports
its external brand and strategy. One company may be comfortable being a U.S.-based company with offices abroad, while
another organization may want to be a true
global organization with country heads
running different business units.

In all cases, companies need to develop a
communications strategy that supports
their mission, is sustainable, aligns employees with the business strategy and allows
them to understand their role.

What are the best tools for effective global
communication?

Global communication requires the use
of several tools. For example, many companies have a large dependence on e-mail.
While e-mail is effective, it’s not the same
as face-to-face communication between an
executive and employees. In some cases,
employees are receiving thousands of messages a day, so naturally it’s easy to see why
e-mail can lose its effectiveness. It’s also
hard to communicate a strong sense of
leadership through e-mail. To maximize
time and efficiency, new technology can
help executives engage their employees
through more personal communication.
Blogs, podcasts, webcasts and teleconferences all have their place as part of an
effective communication strategy. In considering tools, companies should consider
company culture, local culture and, of
course, the content of the communication.

What ROI increases can a CEO expect from
establishing an effective communications
plan?

Companies with highly effective communications plans had a 57 percent higher
return to shareholders and a 19.4 percent
overall increase in market premium during
the five-year study period. During that
same time, companies with effective communications plans were 20 percent more
likely to report lower turnover rates than
their competitors without a plan. Our statistics at Watson Wyatt show that the cost
of turnover is roughly 48 percent to 61 percent of the annual wages for that position.
Many companies brag about employee loyalty and their low turnover rates. Our study
shows that committed employees actually
drive shareholder return and take employee loyalty to a whole new level.

LISA O’DRISCOLL is the San Francisco communications practice leader at Watson Wyatt Worldwide. Reach her at (415) 733-4304 or [email protected].