Why IC practice leadership is worth a fortune

What if:

we’ve all inherited a paradigm in which…

…IC measurements are incomplete – and everybody’s missing the really big stuff?

Measuring the value of Internal Communication (IC) is one of those ‘things’ which never seems to be satisfactorily resolved. Yet we’re all familiar with the idea that what gets measured gets managed. And IC is the most ubiquitous of all business activities, so surely any responsible organisation should be measuring its value, should it not?

Interestingly, though, over the years we’ve asked hundreds of IC Managers why they’re so keen to prove what they’re worth. And – without a single exception – everyone comes out with a list of things they want to change. So, if that’s the real point of doing it then, paradoxically, proving what they are worth is largely a waste of time.

They’re already worth that much without changing anything. Of course it’s good for protecting what they’ve got, but not so much for getting IC taken more seriously as a business discipline. To achieve that we have to demonstrate IC’s untapped potential: what it could be worth if it received the necessary investment. But how can you measure what isn’t yet there?

Easy.

Why IC Practice Leadership is worth a fortune

Internal communication requires three investments and can involve up to eight unnecessary costs. The costs fall into two categories:

  1. Wasteful production & distribution costs – which can make the three necessary investments unnecessarily high
  2. Communication failure costs – incurred when internal communications don’t achieve the necessary results.

When you can explain these needless costs to your senior managers – and show them hard numbers – you can dramatically change their appreciation of IC’s untapped potential. But let’s start with the investments.

Necessary investments

A: IC budgets

(No explanation needed here, surely)

B: Production & delivery time:

This involves the time of IC Specialists, their clients’ time and that of anyone involved in approvals and sign-off. And, if the communication’s being delivered live, it also includes the time of those doing that delivering.

C: Audience time:

Although it’s obvious, communicating with 60 employees for one minute consumes one working hour. So to communicate with 210 employees for 10 minutes, your organisation invests the equivalent of one typical working week.

All these investments are inevitably unavoidable, but they may be unnecessarily high because of…

…Wasteful production & distribution costs

1: Moving goalposts

Clients often change their minds about what they want. Or drafts can get caught up in approval processes where different people want to make changes, correct each other’s corrections, or argue about ‘the right way to write this’.

These needlessly increase production time, and can push deadlines such that any production costs can increase.

2: Ditched projects

In some circumstances, loads of work gets done on a communication project, which subsequently gets ditched before the communications see the light of day. So, all the production time to that point, and possibly some budget (for agency fees, design mock-ups etc) will be wasted.

3: Wasted audience time

Many communications can go to people who don’t need them.

The direct impact of wasting employees’ time is obviously that, unlike external comms, your organisation has to pay those people for that time. But there’s also the indirect impact that unnecessary ‘noise’ can have on people’s ability to invest time in the communications they do need – which brings us to the costs of these communications failing.

Failure costs

4: Repeat communications

If the communication was supposed to address a long term issue, it can be redone if it didn’t work first time. And this will mean making the three investments all over again. But sometimes the issue is a short term one. And if the communication fails, it may often be too late to do anything about it. This means:

  1. the communication, wasn’t needed in the first place, or
  2. its failure will incur one or more of the following four costs…
5: Rework – correcting mistakes and misunderstandings

If a communication fails to produce the desired results, it often produces undesired ones. This can be massive. When I was working with a British financial services company, the Client Services Director worked out that some 30%+ of his people’s time was being spent correcting mistakes and misunderstandings. This equated to 7% of the business’s annual profit.

6: Missed opportunities

With a short term issue, a communication’s failure means the organisation’s opportunity to either save money, or generate income or good will, has immediately been missed. It’s subtly different with a long term issue. Here, all the time employees spend receiving unnecessary communications, or correcting the resultant mistakes or misunderstandings, is costing the additional profit or stakeholder value those employees could have generated during that time.

7: Lost audience good will/increased disengagement

The impact of losing this good will depends on the audience. With employees, it can mean disengagement: lower productivity, possibly even industrial action, or higher staff churn (with inevitably higher recruitment, training and maybe overtime costs). But if ill-informed employees are communicating with customers, it can mean more complaints (possibly incurring compensation payments) and/or fewer sales, re-sales or referrals. In some instances, it could even lead to court cases.

8: Purpose failure

Ultimately, if an organisation’s internal communications keep going wrong, it can start failing to fulfil its very purpose. This can be particularly true of public bodies, Government Departments etc. – which can’t go out of business, but can let down millions of people by simply not doing what they’re there to do. (Sometimes this failure can happen in a particular department of an otherwise healthy organisation.)

Beyond the possibility of regulatory fines for some organisations, this cost is unlikely to be something anyone can put an accurate number on – but it can be a very real cost to those on the receiving end of it. And, uncomfortable though it may be to contemplate, in certain organisations it may sometimes be a matter of life or death. So it’s not always just about the money.

Building a financial mandate

These eight unnecessary costs suggest that internal communication has the potential to add extraordinary new value to the bottom line – whether it’s measured in financial terms, or in other stakeholder value. With DFVP practices, skills and a sustainable mandate for your IC Specialists, your organisation can reduce these costs significantly, and perhaps even remove some of them completely.

That’s why we put together REALISE: to help you build the financial business case.

FREE workshop

And we’re currently offering free workshops which will help you understand more about making this work for your organisation. We’ll set it up to run at a time to suit you and anyone you want to invite. It will:

  • spell out more of the business benefits (emotional, financial and reputational)
  • walk you through the mechanics of moving your IC Specialists into the Sweet Spot, and
  • show you how to make the business case for introducing this new paradigm.
free workshop