The Impact Of Internal Communication on Business Results

Internal communication has evolved. It’s no longer limited to sharing messages from the CEO to the rest of the organization, handling public relations, and communicating important information in times of crisis.

CEOs who participated in a study conducted by The CEO Communications Audit expressed that internal communication helps employees understand their responsibilities in project implementation and the vision that steers corporate initiatives. It’s this understanding that directly impacts successful business outcomes. Well-executed internal communication helps employees know what’s expected from them, how what they’re doing matters, and whether the organizations they’re working for have visions that align with their own.

Peter Dermott, a senior client partner in Korn Ferry’s Corporate Affairs Center of Enterprise, says that internal communications is about “crafting messaging strategies for employees around change in areas like culture, engagement, and performance.” These messaging strategies are closely linked to an organization’s core objectives and, ultimately, they drive revenue.

What Dermott shared aligns well with results from research conducted by Gallagher, where 53% of internal communications professionals shared that engaging teams around purpose, strategy, and values was one of their top priorities. This type of engagement consistently remains at the top of an internal communication professional’s list because it fosters better leadership, improves employee engagement, and helps organizations evaluate how well  purpose, mission, and values are integrated across the organization.

Publicis Sapient is the digital transformation and consulting arm of the Publicis Group, contributing to the success of major brands such as Walmart, Nestlé and Audi. Publicis Sapient represents more than 20,000 employees in 17 countries around the world. 

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Improving internal alignment among purpose, strategy, and values has a ripple effect on external communication and brand perception. Some CEOs who participated in the CEO Communications Audit study viewed employees as brand ambassadors. In fact, employees are often a prospect’s first point of contact before they are directed to a sales team.

For instance, Fred is an employee who works at a financial institution.  The people in Fred’s sphere of influence — friends, relatives, community members, etc. — all know where he works, because he speaks highly of the company. One of his friends is buying a house. Since this friend knows where Fred works, she reaches out to him for help setting up a mortgage interview at the financial institution. Fred has influenced someone in his network to become a paying customer.

Internal communication, therefore, impacts how well an employee can represent a brand. Lack of information or misinformation leads to inaccurate brand representation. But a positive culture of information sharing, growth, and effective communication results in well-informed and purpose-driven employee brand advocates.

Employee brand advocates positively impact the bottom line. In fact, those who share content that helps an organization’s target customers solve problems relevant to them provide over $8.5 million of earned media value for their employers. Strong internal communication leads to employees who not only do their daily tasks but also directly bring in revenue.

The positive impact of brand advocates is particularly important for companies whose employees are the actual face of the brand—the frontline employees working across retail, healthcare, hospitality, and the other service-based industries that make up over 80% of the global workforce. 

According to the Predictive Index, organizational trust is the confidence of your workforce in your company's actions. 

A study by The Institute For Public Relations reveals that the more satisfied employees are with internal communication, the more likely their organizational trust will increase across all five dimensions. In addition, an employee’s satisfaction with the overall communication climate, and satisfaction with communication with an immediate supervisor are the strongest predictors of organizational trust.

Employees who trust their organizations and leaders are more efficient, engaged, and productive. According to the Harvard Business Review:

“Compared with people at low-trust companies, people at high-trust companies report: 74% less stress, 106% more energy at work, 50% higher productivity, 13% fewer sick days, 76% more engagement, 29% more satisfaction with their lives, and 40% less burnout.”

In other words, employees who trust their organizations are happier, more productive, and empowered to thrive. This is particularly important, since a study by the Integrated Benefits Institute shows illness-related absences, which led to lost productivity, amounted to 1.5 billion lost days annually.

A big part of organizational trust relates to knowledge sharing and SME enablement. Following is how internal communication supports these two areas.

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At LumApps, we refer to knowledge sharing as the process by which organizations share information relating to onboarding, collaboration, productivity, and management. But there’s a chronic problem with knowledge sharing within organizations despite technological advances.

According to Coveo’s 2022 Workplace Relevance Report, the average employee spends 3.6 hours daily searching for different types of information at work. This leads to millions of lost productivity hours annually in medium and large organizations.

But a strong internal communications framework helps create a fruitful knowledge-sharing culture where collaboration between employees is routine, the work environment is positive, and everyone helps each other. Open communication (both formal and informal) is encouraged, and leads to knowledge being shared horizontally between team members, and vertically between executives and employees.

With this type of EXP, employees don’t waste time looking for information because they know exactly where to find what they need. Plus, subject matter experts can freely share their insight and experience to help other employees improve their own knowledge.

There’s no denying that internal communication has a powerful impact on organizations. Your role as an IC professional is to connect people with information in a way that improves business outcomes and creates positive experiences for employees. That’s the key to unlocking the true power of internal communication. 
 

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