Tuesday, November 22, 2005   VOLUME 13 ISSUE 3  
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THE SEGAL COMPANY ANNOUNCES NEW CEO
Making Merit Matter: Putting the Merit Back in Merit Pay
Sales Compensation Mistakes You Can't Afford to Make
Outside In, Inside Out: Transforming “Outside” Headline News into Employee-Owner “Inside” Actions
Lead through Communications: Strengthening Commitment, Trust and Retention
HRMAC, Sibson and People Strategies
Sibson's Annual Analysis of Compensation Planning: 2005-2006
Recent Segal Company and Segal Advisors Publications of Interest
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Lead through Communications: Strengthening Commitment, Trust and Retention
by Nenette Kress

In recent years, unrelenting change has been the norm for many employees. Economic conditions — including insignificant or non-existent pay increases (or even pay cuts), the elimination of bonuses, increased cost sharing for health benefits and the freezing of pension plans — have contributed to low morale for many workforces. The problem is compounded in organizations where there is less-than-ideal trust of, or confidence in, the organization's leadership. The 2003 Rewards of WorkTM study by Sibson Consulting* found that 35 percent of employees did not agree with the following statement: “When management of this organization says something, you can really believe it is true.” The study also found that one-sixth of the workforce has high turnover intentions, with one-quarter stating that they would actively look for work during the next year.

Communications can play an important role in recharging morale. A communications strategy and implementation plan will help to focus your organization's objectives, identify audiences and media and determine communications program metrics. Some key points to consider when developing the plan include:

  • Communicate from the top to build confidence. The best leaders share their vision, mission and business strategies, knowing that employees look to the organization's leadership for information about performance and the overall strategy for how the organization will succeed, prosper and grow. Leadership can be responsive by:

– Setting clear objectives,
– Managing employee expectations,
– Candidly educating employees, and
Sharing information.

  • Involve employees. Communications is the constant when it comes to engaging employees. Focus groups can uncover what employees appreciate most — and least — and what organizational improvements might be made. Employers should provide feedback after asking for employee input. When employees are not only asked for their opinions, but are also acknowledged for their ideas and suggestions — especially when the organization implements them — organizations send a powerful message that employees are highly valued and an integral part of the organization's success.
  • Communicate and explain all changes. Organizations must be willing to communicate all changes, both positive and negative. Honest, clear and consistent communications about positive and negative developments help maintain leadership's credibility and build confidence in management. It is important that these communications set the context for change, as well as give employees the complete picture by explaining the factors that led to the changes being implemented and how these changes affects them.
  • Personalize communications. Employees want to see themselves as valuable contributors to the organization. Targeted, personalized messages to employees will clarify the impact of any changes and help facilitate a smooth transition both personally and organizationally. Using personalized statements so employees understand and appreciate their compensation and benefits programs helps to answer the question “What's in it for me?” and can be a valuable tool in attracting and retaining key employees and in driving employee commitment.
  • Track results. Set up measurements against the objectives stated in the strategic communications plan. Build in evaluation milestones that gauge the effectiveness of your communications and identify opportunities for future improvements.

Skepticism, cynicism, dissatisfaction and distrust are fostered in organizations that have poor employee communications. Gaps in official communications tend to be filled quickly by rumor and gossip. To counteract currentand avoid futurenegativity and disengagement, employers should enlist the help of their corporate and HR communications professionals to:

  • Be the primary source of news. Employees should hear any important news from the organization first. Employees feel betrayed when they see in the media that a new acquisition is planned or that the company did not meet its quarterly earnings projection. While some information may be confidential, continuing to communicate about what can be said—as well as what cannot be addressed at any given time—becomes important during periods of change or uncertainty. Answering as many questions as possible on issues affecting employees will give them a sense of security and affiliation with the organization and its leadershipand will help employees participate in and contribute to the new reality.
  • Involve managers and supervisors in the communications process. As credible and accessible spokespeople, managers and supervisors should be part of the communications planning process, participants in the development of the messages and trained in the proper delivery of messages to employees. To help managers and supervisors with this task, the organization's communications and HR professionals can develop presentation tools including PowerPoint presentations, “talking points,” and detailed questions and answers.
  • Be direct, clear and consistent. Ongoing communications should be simple, straightforward, fact-based and consistent to maintain clarity and avoid confusion.
  • Communicate regularly. Replace last minute communications with continuous communications, such as monthly newsletters, frequent e-mail updates, payroll stuffers and periodic, face-to-face meetings. This fosters an environment of openness and trust that positively impacts employee morale and job satisfaction.

Formula for Communications Success
Senior leaders of an organization can work with their HR and communications advisers to implement a formula for successful communications that will engage employees and energize the enterprise. Here are the key elements of such a plan:

Assessment – Find out What's Going on in the Organization

  • Start with a comprehensive review of communications, including approach, messages, media and audiences, to gain an understanding of the organization's “current state.”
  • Ask employees through surveys and focus groups what they understand about the programs, what may be confusing and how they would like to receive communications in the future.
  • Look at what has worked and not worked in the past by organizational and benefit initiative. Employees absorb information in different ways depending on their career level and life stage. It is critical to determine if the right messages are being targeted to the right audiences.
  • Interview leadership and managers to get their perspective and to see if communications are aligned with organizational objectives. Leaders at all levels, from the CEO to first-line managers, can be an organization's most credible messengers if there is an established relationship of employee/employer trust.

Strategize, Implement,and Measure
Sound, well-thought-out communications are the catalyst for whether an organizational initiative succeeds or fails. Using the assessment data as a foundation:

  • Determine the objectives.
  • Develop a communications strategy and implementation plan.
  • Build in evaluation and measurement milestones, such as test marketing media and messages, to help gauge how well the organization is doing and what needs to be done to refine and improve future communications.

Conclusion
Ultimately, finding the right communications solutions to organizational challenges will help engage employees and energize the enterprise. Strategic, proactive, targeted and continuous communications contribute to the ability of organizational leadership to strengthen employee commitment, trust and retention.

Using Communications to Pump Up Productivity
Motivated employees are productive employees, but not all employees are motivated. Sibson's Rewards of Work study also found that high performers are disproportionately unhappy and have a disproportionately high risk of leaving. Communications promotes productivity, keeps employees engaged and focused, and helps strengthen the overall employer-employee relationship by:

  • Demonstrating the organization's investment in employees. Personalized communications are a powerful way to show an organization's investment in individual employees, promote a change in employee behavior, and encourage support for an organization's business strategy. These communications can take many forms — from simple benefit statements, to total compensation statements detailing pay and “hidden” benefit costs, to total reward statements that link all components— and be presented in a variety of media, from printed statements issued at least once a year, to quarterly updates distributed via the intranet or e-mail.
  • Educating employees about how pay is determined. Everyone knows that dissatisfaction with compensation is one of the drivers of turnover. Sibson's Rewards of Work study found that lack of a clear understanding of the pay process is one of the many causes of dissatisfaction with compensation levels. Only 25 percent of employees surveyed felt they received a lot of information about their compensation systems. And fewer than half of employees were satisfied with the compensation system itself, including the way promotions are decided, how an individual could move to a higher pay grade, and how jobs are assigned to pay grades. In addition, fewer than half (46 percent) of employees were satisfied with the openness of the compensation system.
  • Reinforcing reward-and-recognition programs. Communications should highlight savings or performance improvements and remind employees that their personal performance and success are linked to the organization's overall performance and success.
  • Recognizing contributions in non-cash ways. Mark Twain once said, “I can live for two months on one good compliment.” Many employees believe that their contributions are undervalued. In the absence of, or in addition to cash rewards, non-cash rewards can be influential tools for engaging employees and promoting productivity. Non-cash rewards and recognition programs, including verbal or written public praise, thank-you notes, “great job” certificates, and service awards, go a long way towards letting employees know that they and their contributions are valued. Creative communications packaging and delivery largely drive these low-cost, high-impact programs.
  • Soliciting employee feedback on issues that affect job performance. Once the “rumor mill” starts churning, employees usually assume the worst and lose their focus, often taking a high toll on productivity, morale, and attitudes. It is important to keep options for two-way communication open. The organization should encourage discussions with managers and supervisors and provide these front-line leaders with appropriate tools (i.e ., a “24/7” voicemail hotline, intranet surveys and/or quarterly focus groups) to address employee concerns and manage expectations.

* Sibson, a division of The Segal Company, focuses on human capital management issues. For more information about Sibson's services, visit www.sibson.com

Nenette Kress is a Senior Vice President and National Practice Leader of The Segal Company's Communications Practice, in New York. Contact Nenette at nkress@segalco.com.

 


Published by Sibson Consulting
Copyright © 2005 by The Segal Group, Inc., the parent of The Segal Company. All rights reserved.
Sibson Consulting is a division of The Segal Company. Editor, Lee Shoquist, Original Artwork by Richard Whyte.