How Top Business Communicators Measure the Return on Investment (ROI) of an Organization’s Internal Communication Efforts

Topic: Measurement of ROI for Internal Communication

Author(s), Title and Publication

Meng, J., & Berger, B. (2010). How Top Business Communicators Measure the Return on Investment (ROI) of an Organization’s Internal Communication Efforts. Institute for Public Relations.

Summary

This study examined how and to what extent top business communicators measure the return on investment (ROI) for their internal communications efforts. The research assessed data from a 2007/2008 Watson Wyatt survey of 265 employee communicators and drew from depth interviews with 13 senior and award winning business communicators in four countries. Though communication effectiveness is an important concern of organizational leaders, the survey found that communication metrics are not widely used. Nearly half of the survey respondents (46.6%) indicated their companies used no formal assessment of communication efforts related to business performance. Only 17.2% reported that more than 50% of their internal communication initiatives were measured by business outcome metrics. Large organizations and high-effective companies measured communication effectiveness to a far greater extent than did smaller or low-effective companies.

Five aspects of internal communication were measured most often: 1) employee awareness or understanding of a subject, 2) the extent to which information helps employees do their jobs better, 3) the impact of information on behavior, 4) the impact on employee engagement, and 5) relationships between communication effectiveness and business performance. The three most common measurement approaches were employee feedback through surveys, quantitative or qualitative feedback from managers on communication performance, and levels of employee participation in communication-related initiatives. In interviews the senior communicators said the biggest barriers to measurement were insufficient resources, lack of research knowledge, and difficulties in determining cause-and-effect relationships between communication initiatives and business results.

 

Implications for Practice

It is difficult to define, operationalize, and measure internal communication effectiveness, and the profession has a long way to go in this regard. High-effective companies in the study appeared to do a better job of engaging employees in the organizational business (line of sight) and in maximizing employee involvement in internal communication programs. The most effective business outcome metrics for any employee communication program may have to be customized and adapted for a company’s unique culture.

 

Location of Article

The article is available online at: http://www.instituteforpr.org/wp-content/uploads/BusinessCommROI.pdf

 

Posted in [Research Library], Employee / Organizational Communication, Measures and Measurement and tagged , , , , , , , , .

One Comment

  1. Measurement matters, but it has never been an easy task for organizations to effectively set benchmarks and measure the internal communication efforts. To make things worse, communication inside the organization often happens at various levels (i.e., dyadic, team, and organizational levels) and serves for different purposes. So there is no single rule of measurement. I found this article particularly informative and implicative as it summarized the existing major measurement metrics utilized by organizations to demonstrate internal communication effectiveness based on an assessment of quantitative and qualitative data.

    The authors noted that the following types of metrics are often used to measure internal communication: employee awareness, the influence of information on employee job performance, information influence on behavior, impact on employee engagement, and the linkage between employee communication and business performance. While I can’t agree more these metrics are critical in measuring internal communication, I have some additional thoughts based on my reading of the article and other literature on public relations evaluation. On the one hand, individual employee communication programs can increase employee awareness (i.e., informational), change employee perceptions (i.e., attitudinal), and behaviors (i.e., behavioral). At the awareness level, the results of internal communication could be employees having more knowledge of a particular subject, such as organizational missions, visions, values, goals, or organizational policies, news, events, and changes. At the attitudinal level, the outcomes of internal communication can be improved internal reputation (e.g., characters, transparency, authenticity, credibility), employee-organization relationships (i.e., trust, control mutuality, commitment, and satisfaction), and organizational identification. And at the behavioral level, the outcomes could be enhanced employee engagement, job performance, organizational citizenship behavior internally, and positive word-of-mouth, advocacy, and boundary-spanning behaviors externally. On the other hand, the outcomes of employee communication can go beyond the individual (employee) level. They can be linked to the achievement of team/organizational goals and organizational financial performance (i.e., ROI). In fact, the logic should probably be that effective internal communication practices improve employee awareness, shape positive employee perceptions, and encourage supportive employee behaviors, which in turn contribute to organizational financial performance and the achievement of business goals. I am not certain whether this is what’s really happening or should be the case, as these have not been empirically tested. But considering the lack of a golden standard of measurement and the challenges in quantifying the internal communication outcomes, I think such empirical research is in great demand and will have significant value for internal communication managers. I am eager to hear other colleagues’ thoughts, opinions, or experiences on how internal communication should be measured!

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