Many businesses under-perform because functional department strategies are misaligned with the overarching business strategy. The misalignment diffuses energy and saps productivity. It’s also avoidable.
This is a timely subject as I head to New Orleans later this week to conduct a special three-hour workshop June 5th at the World Conference of the International Association of Business Communicators (IABC).
Many new and seasoned communication practitioners want to add measurable value to their organizations but they don’t know where to start. There’s a huge difference between having a strategy and capitalizing on it. The starting point is helping people understand the strategy. That’s a major communication issue that we’ll address first on Sunday.
The IABC workshop participants will be introduced to the following facts, found in a recent Forbes article.
• 65 percent of organizations have an agreed-on strategy.
• 14 percent of employees understand the strategy.
• Less than 10 percent of all organizations successfully execute the strategy.
That’s not just “better communication” as many know it–the reactive kind such as blogs, tweets, Facebook likes, town hall meetings, newsletters, posters or brochures. All of these are legitimate communication vehicles. These just don’t have that much impact on operating or financial performance. They report the news and distribute information, but don’t necessarily help people decide what to do and then act on it.
Why do these significant gaps exist and how does communication need to be managed differently?
Many organizations do a poor job of communicating the business case for change, painting a picture of what the organization will look and be like when it’s successful or connecting the strategy to the work people do. Results rarely change unless work changes. So, to create better results, people need to improve what they do. How do they know what to do differently unless it’s explained to them?
The strategy needs to be dis-aggregated, so employees know what to do when they come to work each day. As an example, one of our clients’ primary financial goals is operating income. As Jack Stack, the open book management pioneer says, “Lines on an income statement are merely stories about what people do.”
So, our client broke down the income statement in order to help each employee understand what he or she had the opportunity to impact every day. Ultimately, the operation improved on-time delivery by 38 percent, total cycle time by 32 percent and productivity by seven percent.
People also need information and training to do their jobs well. In one organization we worked with, people were hired and given little training or explanation of how to do their jobs. Scrap and rework were incredibly high. Supervisors brought employees together and created standard work practices to reduce these expenses. Within two weeks, scrap and rework declined 60 per cent. Over time it was reduced to nearly zero.
Measurement communicates. What you count counts. Rewards and recognition communicate “what’s in it for me” when people perform in a way that’s consistent with the organization’s goals.
When a pay system is misaligned with the goals, poor performance is usually the result. In a distribution company we worked with pay was more heavily weighted toward productivity than quality. Quality suffered. Re-aligning the pay system contributed to a 65 percent improvement in quality and a 16 percent improvement in productivity.
In New Orleans, we’re going to define communication like our business leaders, employees and customers define it. To them, communication includes all the ways we send, receive and process information. It’s the things we say and the things we don’t say. It’s what we do and don’t do. You can’t not communicate.
With that definition, we’re going to create hard-nosed plans that align our communication strategies with our organizations’ business strategies. As they should be! We’re going to put a dent those Forbes numbers.
KEY TAKEAWAY: There’s a huge difference between having a strategy and capitalizing on it. The starting point is helping people understand the strategy, so employees will know what to do differently when they come to work each day. Results rarely change unless work changes.