Companies that communicate with courage, innovation and discipline, especially during times of economic challenge and change, are more effective at engaging employees and achieving desired business results. Our research has consistently found the firms that communicate effectively with employees are also the best financial performers.

When it comes to communication, successful companies pay close attention to articulating their employee value proposition. In times of change, they use social media and other, time-tested tools to communicate with an increasingly diverse and dispersed audience. These companies treat their managers as a special audience — offering additional communication and training to help them manage. They focus on the customer and use communication programs to drive productivity, quality and safety.

This report summarizes the findings of our 2009/2010 multiregional study. It identifies what the companies with highly effective communication practices are doing to inform and engage their employees in challenging economic times, and shows how these practices vary around the world.

Key Findings:

  • Effective employee communication is a leading indicator of financial performance and a driver of employee engagement. Companies that are highly effective communicators had 47% higher total returns to shareholders over the last five years compared with firms that are the least effective communicators.
  • Despite all of the organizational and benefit changes employers have been making in response to challenging economic conditions, only 14% of the survey participants are explaining the terms of the new employee value proposition (EVP) to their employees.
  • The best invest in helping leaders and managers communicate with employees. While only three out of 10 organizations are training managers to deal openly with resistance to change, highly effective communicators are more than three times as likely to do this as the least effective communicators.
  • Despite the increased use of social media, companies are still struggling to measure the return on their investment in these tools. Highly effective communicators are more likely than the least effective communicators to report their social media tools are cost-effective (37% vs. 14%).
  • Measurement is critical. Companies that are less-effective communicators are three times as likely as highly effective communicators to report having no formal measurements of communication effectiveness.