Effective communication programs are not only important in the day-to-day workings of a business but, as a new study indicates, they can also have a financial impact for shareholders. Based on responses from 264 companies, Watson Wyatt’s 2007/2008 Communication ROI study found that companies with the most effective programs had a 47% higher total return to shareholders from 2002 to 2006, compared with those whose programs weren’t as effective.

Kathryn Yates, global director of communication consulting at Watson Wyatt, said these top-performing companies regard communication as one of the main business drivers.

The study pinpointed six practices of these companies:
• focusing managers and employees on customer needs
• engaging employees in running the company
• helping managers communicate effectively
• using internal communicators to manage change effectively
• measuring the impact of employee communication
• branding the employee experience

The study also found that communication had an impact on employee engagement. Companies with effective communication were four times as likely to report high levels of employee engagement than companies with ineffective communication. Effective communication programs, said Yates, address the whole array of employers’ relationships with employees and help engage and motivate workers.

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