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Over the past few months I’ve attended (mostly virtually) a number of webinars and conferences focusing on social analytics and business intelligence. The latest was the Social Intelligence Summit put on by the W20 folks in London. (Here is a good blog post on the session.) I always come out of these sessions really impressed, even dazzled, by the advances in technology and intellectual leadership at the cutting edge of social business. The big lesson for me from these sessions is that the digital world is – with few exceptions – transparent, observable and measurable, and we’re coming up with increasingly smarter ways to find, package and use the digital data.

It’s difficult to pull highlights from the sheer volume of notable observations and insights, but here are a few I’ve noted:

  • There are now a wide range of sophisticated, user-friendly tools to help organizations monitor, aggregate, analyze and report activity on the Web – including multi-media discussions occurring on social platforms;
  • Analytics software can now provide complex, real-time data and insights that allow organizations to monitor and adapt their outreach 24/7;
  • Smart companies have gone well beyond listening and engagement and are now using the data to understand their audience (and how their brand is performing) and gain intelligence to drive their business;
  • Powerful analytics are being used well beyond the basic objectives of marketing – to drive brand or product awareness, consideration and hopefully purchase – and are now helping to guide activities as varied as health planning, product development and even predictive consumer research;
  • There seems to be a shift in what companies measure, with some focusing well beyond the usual reach/share of voice/tone to issues like identifying and mobilizing small groups of influential advocates, or determining highly customized and protean media channel strategies;
  • Some of the most interesting and advanced analytics work seeks to link social data and insights with specific business processes, transactions and outcomes – and using the insights to adapt and improve related business results.

My initial thought coming out of these events is euphoria (and humility) at the incredible innovation and intellectual sophistication in social media circles, and appreciation so much of this information and technology is readily available for all to use. But inevitably there is a thud when I return back to reality with my own observations, projects and clients. The reality is what I hear in these conferences and webinars still seems like rarified air in my consulting environment, with most clients or peers I see still grappling to understand and implement even the most rudimentary social platforms and strategy. If anything, I feel the gap between the analytics gurus and many of the corporate leaders (and communication pros) I work with is getting wider. In effect, I see a few pioneers with one foot in the future, but many others with one foot firmly placed in the past.

Perhaps the largest gap, and opportunity, is inside the organization. Most companies have at least some commitment to monitoring external social conversations and using the resulting data and insights to direct their social strategy, if not their broader business. But it’s much more infrequent to find companies that deploy social technology inside their enterprise and actually monitor, measure and analyze all the data generated by their employees. And leveraging Intranet traffic metrics or annual engagement surveys does not count as a real-time, robust analytics strategy.

Think of the potential outcomes if companies started to aggregate and interpret all the data on or from their workforce. Those kind of insights would not only help to track and drive engagement – the priority for many HR leaders and employee communication executives – but also provide valuable information to positively impact business outcomes such as productivity, retention, safety and even customer service. I’m personally hoping the analytics gap closes soon. Otherwise leaders and communication professionals are leaving a lot on the table.

A few months ago a good friend and industry peer asked me if I had any employee engagement plans. I had to think a minute, but as it turns out in over 25 years in the communication business I’ve maybe worked on one or two plans that could be considered comprehensive engagement programs – either for my own own company or a client. How is this possible? Isn’t engagement a virtual obsession among corporate executives and a mantra for internal communication pros?

I concluded this void – at least in my own experience – reflects a lack of understanding and commitment among many organizations that claim to seek sustained engagement. Though engagement is the holy grail of internal communications (and related fields like HR) most companies – though well-intentioned and determined to drive engagement – seem to take a piece-meal approach that only addresses one or two aspects of an employee’s workplace experience.

But the reality is it takes a holistic, sustained and integrated approach to ensure employees are informed, motivated (even passionate), productive and loyal. Many factors should be considered and working in strategic alignment to encourage engagement. But in today’s matrix, decentralized organizations the teams responsible for these functions rarely collaborate on that level, and in some cases their siloed activities may even be sending mixed messages to employees. I’ve seen this particular formula several times: spend energy and resources to ensure employees know exactly what they have to do and why they should do it, but don’t engage other functions (like HR) to ensure these same employees are actually trained, supported, recognized or rewarded for said work. Too many companies seem to think an annual survey (to measure engagement) and a few high-profile fixes (to address prominent issues) is the necessary exilir for employee engagement, but that’s only a start.

One approach I’ve used that seems to drive relevance and alignment in engagement activities is to use the employee’s perspective; what are the employee questions and needs that need to be addressed – and answered cogently and consistently – to shape a positive, productive workplace experience? Take a look at the attached presentation for additional details.

Whatever the strategy for engagement, the lesson is that there are no shortcuts. But without concerted action companies risk not only stagnant productivity and attrition of talent, but also lose the opportunity to mobilize their employees as advocates. Given the increasing profile of social media platforms in recent years, what employees say – good or bad – about your organization can have a huge impact on reputation and even sales.

For more information check out this presentation.

 

Over the past year, I’ve witnessed and engaged in several discussions – both online and in person – that explored the mandate and modus operandi of the employee communications function. Though the topics vary, a recurring thread – or really more of a question – relates to who “owns” content developed for an employee audience.

In one online polemic, for example, a participant suggested that a key role of internal communication (IC) practitioners was not only to create most of the content for employees, but also to control, or filter, all content reaching staff to ensure they were not overwhelmed or confused by irrelevant information. Many other discussions seemed to support this position – which suggests a traditional role where the development and delivery of content is directed, if not rigidly controlled, by the IC team.

Though I agree that in many organizations there is far too much frivolous or irrelevant content dumped on employees, I am struck that this “we know what’s best” attitude is badly out of sync with the prevailing ethos of social media, where the power of creating and vetting content and determining editorial agendas has shifted to the “crowd” – or individuals.

Looking from another angle, however, it’s clear that the answer isn’t a free-for-all where individuals and functions are able to generate and share content as they see fit. Employees in most companies often complain of being overwhelmed by the volume of emails and other content – most of which has little relevance to their job or interests. Even accessing simple social platforms (such as Yammer or Chatter) seems to be a stretch for busy employees. So more is not better.

It’s true that some content or communication tools created organically can be useful and get traction; I can think of several examples where social tools or even more traditional e-newsletters created by teams or offices are successful (in terms of reach, ratings and impact.) The problem with a largely decentralized, informal approach is that in aggregate the communication can lack quality, focus, structure and purpose. It can also be very difficult in these noisy, informal environments to find the most urgent or important content; even critical leadership announcements can get lost in the mix.

In this context, I suggest the answer lies in a balanced approach where the communication team becomes a content curator – or a light-handed editorial manager. In essence, ownership of content is shared. The IC team should still play a robust editorial role – creating critical corporate content, counseling functions and teams to encourage value and quality over volume, and limiting what gets broadcast through main corporate tools and channels – but also foster and amplify content generated by employees and internal experts. Whether content is valuable and relevant should be determined jointly by all parties – with the ultimate measure being whether users access, use and share the information. This curator model also allows for rich peer-to-peer communication through social platforms and collaboration tools.

In reality, internal communication has always been a balancing act between communicating what the company wants and covering what the employees want to know and talk about (usually more personal and local issues and “what’s in it for me” questions.) Positioning the IC team as a curator – rather than a self-appointed editorial gatekeeper – builds on that tradition and provides leeway to take advantage of user-generated content, organic storytelling and social or collaboration platforms. It also reinforces the reality that employees – like external consumers – have ideas, interests and information that bear as much consideration as those of senior executives. This new construct may not please traditional CEOs or communicators who favor a top-down approach, but it’s a better recipe for success in this evolving environment.

I haven’t really talked about the evolving nature of content – with the growing emphasis on storytelling and trans-media digital content – but that’s a story for another day.

A few weeks ago I spent time with an old friend who worked in a company that by all appearances was a dynamic, successful industry leader: steady profits, stable leadership, healthy prospects, and a supportive board of directors. But if you asked my friend, or likely many of his colleagues, the description of working at this company would be much less positive. In fact, many of them hate going to work, and they spoke of a palpable malaise inside the company. The reason: a detached CEO who is largely dismissive of communication and culture.

This anecdote brought to mind the old medieval adage that as the king goes, so goes the country.  It’s pretty well accepted as a truism that CEO’s have a direct and enormous influence on their companies, of course. They direct and deploy workers in an organization much like a general in battle. But the twist in this story suggests that their impact goes beyond the most obvious elements (and requirements) of corporate success – such as organization, logistics, strategy and financial performance. A company (and leader) doing all the basic things right – at least according to the MBA playbook – can still be horrible workplace, with disenchanted and disengaged employees.

According to my friend, the CEO at his company has a blind spot when it comes to communicating with employees – grudgingly allowing only perfunctory, formal outreach and avoiding genuine, personal interaction as much as possible. Probing employees for ideas and opinions is limited to a typical annual “culture survey”, which apparently drives little discussion, response or change. Needless to say, convincing this CEO of potential investment or innovation in communication is a losing game.

The CEO also apparently sees little value in fostering a positive, distinctive workplace culture. Sure, the typical HR activities are in place – ostensibly to motivate and reward workers – but there is no leadership interest in truly exploring and improving worker morale and satisfaction. And the corporate identity is muted and generic, with little to inspire pride or discretionary effort. In other words, employees should do their jobs and be happy they have one. Since this company is located in a relatively small job market – with limited options for senior executives – there’s no immediate risk of an attrition of top talent. And with the company regularly hitting its numbers, the CEO sees no reason to change anything.

This anecdote raises some interesting questions for communication and HR professionals. Does it really matter if employees are happy at work? Is it important for a company to have a distinctive, engaging culture? Is the recruitment and retention of talent really an issue in smaller, stagnant job markets? And what is the ultimate metric for leadership and corporate success?

I propose the answers to these questions all revolve around the central issue of the core purpose of the company. Some would say that making money for shareholders and paying employees for good work is the baseline. I would argue that that viewpoint is shortsighted, and certainly not optimal for talented employees seeking a fulfilling career and perhaps even a higher purpose. In other words, employees don’t just need to know (and believe) what the company does, but what it stands for and what it hopes to achieve beyond driving profits. Without that deeper affinity and sense of purpose, most workers will remain steady (if unspectacular) performers and jump ship at the earliest chance.

A prominent topic for many of us involved in employee communications is engagement. Engagement has become a proxy for everything from evaluating the effectiveness of internal communications to assessing the psyche of contemporary workers. For the past few years, the news about employee engagement has been mostly negative, with the economic downturn making working conditions tougher than ever and employees feeling increasingly overworked and disillusioned. That may be changing. With the global economy slowing improving it appears employee engagement is also slowly turning the corner. Indeed, recent global surveys show some positive trends in employee engagement, with several studies showing slight improvements in overall engagement. Still, the picture is far from idyllic. Despite pockets of improvement there is still a stubborn, sizeable minority of passive or actively disengaged workers; Aon Hewitt puts this at 4 out of 10 workers. And the gap between the best companies (with the most engaged and productive employees) and the global norms is still substantial. Read the rest of this entry »

This article by the folks at Hay Group argues that the next frontier for HR is harnessing “big data” to drive engagement with employees and improve talent management – the holy grail of many HR teams. The author suggests there is a stark contrast between the massive explosion of data and real-time analytics in fields like marketing and retail with the halting, uneven progress in HR. For many HR teams, the promise of big data is still more potential than reality – notably in the area of talent development and succession planning.

This assessment is in line with what I’ve seen over years of working closely with HR teams in a wide range of organizations. Despite the emergence of powerful tools and technology – and access to related data on employees and their performance – too many HR departments are still struggling with rudimentary challenges like creating clean, dynamic staff directories and are barely scratching the surface of data collection and analysis. Though in theory HR departments know a great deal about their employees, I haven’t seen (or heard of) many teams that are consistently collecting and analyzing data and using their insights to direct their policies and programs. (To be fair, the one area that seems to be evolving for the better is online performance management. ) In fact, it’s not rare for me to encounter HR teams still using written records or forms for many of their HR transactions – which obviously limits their ability to quickly collect, update and review the information.

Here are a few examples where big data – used to its full potential – could dramatically improve engagement and results beyond talent management:

  • Virtually all leading organizations conduct some sort of engagement or culture survey. Many of these surveys, however, remain superficial (often formulaic) annual surveys more useful for benchmarking than driving real change – including responsive program and policy adjustments – across the organization. Often these surveys are outsourced and the information is reviewed once to develop the final report, and never seen or used again. With all the enterprise social media platforms and real-time analytic tools available, would it not make sense to implement a more sustained, detailed and actionable research program with employees? At minimum, companies should track the content of internal conversations (on the intranet, blogs or other discussion platforms) with the same level of sophistication and follow-up as they do with external platforms. Listening should not be a one-time annual event, but a full-time contact sport.
  • Though some companies have mastered the art of knowledge management and make it easy for their teams to identify and contact peers for collaboration, others still struggle with relatively simple profile information that would allow employees across all levels to search for peers with specific skills, expertise or experience. Having this data readily available would also help leaders develop ad-hoc project teams and make informed staff assignments.
  • While consumers are repeatedly probed for their opinions and preferences on topics like communication and marketing, employees are not consistently asked about company communications. Though some companies conduct robust, actionable internal audits designed to assess the effectiveness of their communication efforts, many rely on piece-meal efforts that are often event-driven, sporadic and informal (qualitative.) Others don’t take full advantage of the built-in tracking devices on their intranets or corporate email tools, which can provide a rolling update on key metrics like traffic, page views and comments. This is a relatively easy fix that can help to make corporate communications much more relevant, resonant and impactful.
  • Though it’s not employee data per se, harnessing the ideas and collective wisdom of an internal audience can be a major driver of innovation and engagement. Companies like Dell and RBC use an internal crowd-sourcing platform to solicit and rank employee ideas on a range of topics, and incorporate the best suggestions in their operations and planning. Several vendors provide user-friendly platforms that do most of the work behind the scenes and allow users to focus on the ideas and the outcomes.

Much like IT’s reluctant acceptance of social media and new technology, I fear HR’s slow adoption of data collection and analytics will decrease its relevance and credibility in the coming years. The result will be the exact opposite of what the HR teams seek; prospective employees raised on social media, ubiquitous communication and all-digital content are unlikely to be impressed if the very team responsible for managing talent and fostering a dynamic culture is so clearly out of sync with social and technology trends.

One of the ongoing challenges of my consulting work the past few years has been to convince clients to engage their employees in their external social media efforts. The argument for doing this is very solid – see this excellent post by Dion Hinchliffe of Dachis Group on the benefits and requirements of using employee advocates through social media. Perhaps the best argument for activating employees is that they are highly trusted by consumers and customers alike. So why is this not happening more often?

In my experience there are several answers to this question. For one thing, many organizations are still reluctant to engage in any social media activity – external or within the enterprise – so it’s understandable that their employee outreach strategy would also be nascent. Others are extremely concerned about rogue employees who can compromise the reputation of the company in one tweet or YouTube video, and can bring up several recent examples to support their position. A surprising number of companies (from my experience) prefer to wait and see, despite the fact they know their employees are already active on social media platforms (such as unofficial company Facebook pages) without the benefit of clear direction, guidelines or training. Companies react differently to these unsanctioned sites and posts – some prefer to turn a blind eye, while others try to quell the comments through punishment and/or additional training. I’ve also seem the other extreme, where cherry-picked employee advocates stray too much into cheerleading (think obnoxious, repetitive Twitter hype) and lose the authenticity and credibility their role demands.

But perhaps the biggest reason – and unspoken truth – is that some company environments are poisoned by distrust, disillusionment and woeful lack of engagement. If many of your employees are unhappy and discouraged, does it make sense to give them full license to represent the company with consumers and customers? Of course, the answer is no. Or at least, not all in one shot. These companies need to fix their workplace culture and foster engagement and collaboration within their walls before they think about activating their staff on social media platforms. (In fact, disgruntled employees can damage a company’s reputation through their actions and comments whether or not they are using social media.) But that’s not an excuse for complete inaction. A social media strategy can allow for a smaller team of ambassadors at the outset, who are selected for specific roles and expertise, provided ample direction and support and highly trained. Real-time monitoring is also critical, not only to assess impact with consumers but also to identify potential issues and ensure ambassadors don’t operate outside the guidelines.

Ultimately, companies need to realize their employees represent them – whether formally or otherwise – and will often be active on social media platforms with or without formal guidance or consent. The best approach is developing a realistic plan to ensure employees are informed, directed, trained and supported to represent the company in a positive light. Using a proactive strategy will allow companies to deploy their best marketing and PR asset – their team members.

Earlier this year Forrester came out with another study commenting on the trend towards increased mobility of technology, and the important implications for marketers. (Here’s another good summary on enterprise mobility trends.) In fact, mobile access to digital information and tools is becoming almost ubiquitous in some developed countries.  As Forrester notes in the report: With more than 1 billion smartphones in consumers’ pockets at the beginning of 2013, mobile is driving a second Internet revolution that’s even more profound than the first one. Mobile creates new value for consumers and businesses, alters cost structures, and disrupts ecosystems. That’s why marketers must move away from tactical mobile efforts to more transformative mobile marketing strategies in 2013.

This disruptive technology is changing how consumers conduct a wide range of activities and use an expanding array of applications and tools – from accessing their email, to banking to downloading an e-book or watching a movie. And the trend is still evolving in both scope and amplitude; in fact, the very definition of mobility is changing. It’s not enough to just address the use of smartphones, or even the booming use of tablets. The recent emphasis is towards “wearable” devices (like Google Glasses) cars and TVs that extend the mobile experience.

Is this mobility trend another example of how internal communications, and employee engagement efforts, lag marketing trends  or externally focused practices? There are huge potential benefits to a robust, relevant internal mobile strategy for organizations. In a mobile environment, the traditional hurdle of access to information and communication sources – which for many workers remains elusive – becomes irrelevant. Furthermore, communication teams can personalize content based on device, role, context (time, knowledge, location) and even personal preference. Mobility provides unique convenience and immediacy – potentially giving employees the ability to do “anything, anywhere and anytime.” It can also provide workers with access to real-time data, a critical benefit in many occupations.

Yet, my personal experience suggests many companies have rudimentary or nascent mobile strategies to reach employees; many appear to still be struggling simply to make their intranet or other digital sources available to their workers. Few are adequately addressing the booming use of smart phones – still debating BYOD issues and/or not distributing smart tools broadly across their workforce. Even fewer organizations outside technology circles are focused on tablets, which are the biggest growth area. Even those considering how to share content across mobile devices do little to help employees create or share content, or collaborate using these same mobile tools. I recognize companies have to address the security, support and cost issues associated with a shift to mobile, but those excuses are wearing thin after several years of discussion.

Some observers are more optimistic about enterprise adoption – check out this article – arguing that the gap between personal use of mobility and work use will continue to narrow. This blog post suggests the expanded use of personal devices in the workplaces (extending to non-executive staff) will continue to drive adoption of mobile applications inside the enterprise. What both of these articles make clear is that even companies reluctant to jump on the mobility bandwagon need to evolve their reliance on their internal “network” (typically secure corporate email, LAN network and intranet) or they risk seeing those corporate channels becoming irrelevant.

I’ll be watching with interest to see if and how companies move towards this mobility trend to improve their workplace communications.

I was pretty happy to read the dual press statements from Yahoo and Tumblr when they announced their partnership this week. I have to admit in recent months I’ve pretty well given up on press releases – a sterile, decaying art form that is seemingly impervious to innovation and improvement. It’s true that some companies have made their releases more social in recent years, even entertaining, but too often releases are formulaic, devoid of personality and cloaked in vague and trite legal jargon. In other words, they are usually boring, generic and lacking credibility.

In this sorry context come the above mentioned releases. First Yahoo. Right off the bat, you’ve got to give the Yahoo team kudos for featuring the elephant in the room right in their bylinewe promise we won’t screw it up. Marisa Mayer’s comments about Tumblr and its CEO David Karp seem genuine and conversational – as if (lo and behold) the quote is actually real. She also acknowledges the obvious – that the two companies couldn’t be more different – but also makes a good case for how they can complement each other. A few other nice touches – the word awesome and an ironic exclamation point  – help make the release not just credible, but worth reading. And though the release has some typical verbiage on opportunity and assets, the business case is presented in a way that makes sense.

The Tumblr statement is even more refreshing, and totally in keeping with the company’s smart, rebellious image. David Karp’s blog post is funny, sarcastic and ends with a disarming “F… yeah!” It’s also concise and hits the obvious concerns of his team right at the top. All this and not a legal term or ten-dollar word in sight.

Beyond the initial statements, both teams used their arsenal of social media platforms to get the word out and provide ongoing elaboration and commentary. In the process, they haven’t shied from some of the controversial aspects of the deal (notably Tumblr’s not so secret reputation as a hotbed of porn.)

The lesson here is not that companies need to make their press releases irreverent or informal, but they should remember their identity and their target audiences – which include employees and consumers, not just Wall Street heavies. In this case the tone of the statements seemed entirely appropriate. It helps that this transaction seems to fit with the strategy of the respective companies – Yahoo gets a new potential audience, a boost in buzz and some much-needed hip factor; while Tumblr keeps its independence while benefiting from the huge audience and finances of a large partner. Another point I’ve argued many times with peers and clients is that information that is important – notably in formal announcements like press releases that must be carefully crafted – doesn’t have to be serious or boring. Compelling content that is aligned with readers’ interests, lexicon and media habits is much more likely to be read and believed. Isn’t that the point of releases in the first place?

Keeping employees informed of their company’s financial performance would seem a given. With the explosion of available data online and the increasing mobility of Internet access – which makes financial information readily available – it’s critical that companies proactively keep their employees informed on their quarterly results and investor profile (if they are public.)

For one thing, many employees are themselves shareholders in the company (many through retirement plans) and have a vested interest in the earnings reports. Beyond that, ensuring employees understand company performance, and implications for the business, is important to help them connect the dots between their individual performance and company results. Updating staff on earnings also helps reinforce how the company is tracking against its strategy and business priorities (which themselves need to be explained and repeated) and provides important context for company decisions and policies.

Yet for all that rationale, a surprising number of companies seem to put little or no effort into driving internal financial literacy. [My observation is anecdotal – I can’t find any solid research to back this up.] It’s true that financial information is both complex and sensitive – and not necessarily considered sexy content – and has not historically been part of the communication menu for many organizations.  A common challenge is balancing employee interest and understanding on financial issues (which can be very low) with the need for leaders to be transparent and credible. Despite these inherent challenges, companies should err on the side of disclosure; I would argue it’s better for employees to complain they are bored or don’t fully understand financial information than accuse their leaders of not being candid or forthright.

Recycling external earnings content – an apparent easy fix – isn’t enough. Too often companies use materials and tactics aimed at investor audiences and simply share those unchanged with employees. This approach is shortsighted and often ineffective. The internal strategy and content should be customized for employees. Putting thought and effort into regular updates – using some of the best practices listed below – can help companies foster leadership credibility and increase financial literacy among employees. In the long run, this should help increase staff understanding, effort and engagement.

  • Be accurate and consistent: The most important factor in updating employees on financial performance is the imperative to be accurate and use consistent figures and messages across all audiences. This isn’t just good communication, but in many jurisdictions it’s a legal priority.
  • Avoid the hype: Many employees are cynical and skeptical of financial updates because they are too often overly positive and wrapped in hype – particularly if the messages are geared to investors. Resist the temptation to hold back information when the news is bad, or employees may jump to their own conclusions. To be credible, the updates must be regular, balanced and candid. Leaders can be optimistic and positive, but the core information should be direct and devoid of cheerleading.
  • Story behind the numbers: While it’s important to share some of the core financial information with employees, it’s far more useful to share the story behind the numbers – What happened to the key metrics? What drove the results? What does it mean to the business/strategy? What is the internal context for these results (e.g. internal cost-cutting.)? What does it mean for investors/Wall Street or private owners? What does the team need to do as a result? More importantly, show employees how their daily work contributes to companywide growth.
  • Provide context: Use quarterly updates – and ongoing staff and department meetings – to share business and industry trends and put them in perspective. This will provide important background for the financial/earnings outreach.
  • Segmented cascade: Though it’s appropriate to have a CEO lead the communication effort with the broad workforce (perhaps a company memo, blog post and/or short video statement) that should be complemented by more targeted outreach by functional and regional leaders who can make the information more relevant by adding targeted results for their teams. This approach can/should be used down to the level of manager, who may have information on a factory or facility level that can provide additional detail for employees. This effort should be supported with solid direction and support from Communications (e.g. cascade toolkit) and be coordinated to avoid massive duplication.
  • Know your audience: Content should ideally be tailored to the interests, routine and requirements of the various employee segments. Leaders shouldn’t “talk down” to their employees assuming they can’t understand basic financial concepts, but conversely they should consider that many front-line employees aren’t interested in, or familiar with, the nuances of financial results. A good approach is creating core messaging/content that appeals to the majority of employees and adding complementary content for specific internal segments. Senior leaders typically can be expected to receive and understand a fairly detailed and sophisticated earnings update.
  • Avoid jargon: Building on the point above, it’s important any financial information for employees be simple, clear and devoid of unnecessary jargon. Terminology that’s important to an analyst is not relevant to most employees.
  • Dialogue: In order to spur conversation and provide an opportunity for explanation and discussion, it can be useful to have senior leaders (perhaps the CEO and/or CFO) participate in an online panel/webcast or video interview where the “story behind the numbers” can be explored and employee questions can be addressed. This is particularly true is the financial results are a surprise or disappointing. Latent employee questions or concerns can proactively be addressed in these sessions. The content of these calls can also be promoted and archived after the fact. Similarly, any internal social platforms (Yammer, leadership blogs) should be featured during the financial updates to foster discussion.
  • Be timely: It’s good form to inform your employees at the same time – if regulations allow – as the financial update is shared externally. A delay will erode credibility and usefulness of the update.
  • Think visual: Some of the most effective examples of financial communication feature simple, compelling visuals (graphs, scorecards, info graphics) to represent key concepts and results. This approach ensures the information is presented in a clear, consistent fashion without being boring.
  • Bring the outside in: Though it’s important the outreach to employees be tailored for them, companies should also leverage/promote their key investor events internally through news features, social media updates, links and/or posting on the intranet (e.g. investor days, shareholder meetings, annual reports.)
  • Voice of the customer: It can be useful to include comments from investors, customers and/or analysts in the financial updates to provide a third-party perspective on the performance. This can help company leaders to emphasize certain themes or messages with employees.
  • Humanize the numbers: Examples and anecdotes that illustrate the company’s performance – for example stories of employees or teams achieving savings or big customer wins – can help humanize the financial results and make the information more relevant and interesting to employees. Having these employees tell their own story is even more compelling.
  • Education through repetition: Employees can/should be educated on key terms (EBITDA, cash flow) through simple examples and repetition of these definitions across all references and materials. A glossary of terms should also be easily available (e.g. intranet) and promoted with employees.
  • Use sound bites: The use of short summary headlines with links (like Twitter updates used externally) can be an effective way to get out updates to a broad employee audience in a convenient, timely fashion. This allows interested staff to obtain more detail but ensure all staff has some awareness of the key results.
  • Think pull vs. push: Though leaders should proactively share (or push) custom highlights of quarterly performance, a good approach to promote transparency is to make more detailed information available to all staff – usually through the intranet and/or press materials. Along these lines, all regional and functional updates (be they presentations and/or memos) should be posted on the intranet for easy access to all employees.
  • Communication beyond/after the quarter: Companies should consider reinforcing the key financial concepts, targets and even results beyond quarterly updates via bulletin board scorecards, digital posters or other collateral to reinforce this information beyond the quarterly updates. Use of compelling visuals can help drive awareness, understanding and engagement on these topics.
  • Educate staff on disclosure rules and best practices: All updates on financial performance with company staff should include reference to the legal requirements and limitations to ensure employees don’t breach any SEC regulations or company rules (e.g. disclosure of confidential information, media contact). This information should also be easily accessible on a permanent basis on the intranet.
  • Foster an ownership mentality: Employees should not be a passive audience when it comes to financial updates. Encourage staff to adjust their priorities and activities given the company’s overall business situation. Invite their input on process improvements, cost-cutting and new business sources. Recognize and reward ideas that lead to greater efficiency and growth.

 

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