Thursday, December 08, 2005

Employee's Communication:The New Mantra

One of the biggest challenges which organizations face today is communication. Employee communication is considered to be the most effective indicator of its people practices. It is believed that communication is the key to superior performance and good work ethics.

In a study conducted by Watson Wyatt it was found that effective financial performance of the organization was linked to its Employee’s communication. Some of the major findings of the study are:

Companies that communicate effectively have a 19.4 percent higher market premium than companies that do not.

Shareholder returns for organizations with the most effective communication were over 57 percent higher over the last five years (2000-2004) than were returns for firms with less effective communication.

The 2005/2006 study found evidence that communication effectiveness is a leading indicator of financial performance.

Firms that communicate effectively are 4.5 times more likely to report high levels of employee engagement versus firms that communicate less effectively.

Companies that are highly effective communicators are 20 percent more likely to report lower turnover rates than their peers.

Two-thirds of the firms with high levels of communication effectiveness were asking their managers to take on a greater share of the communication responsibility, but few are giving them the tools and training to be successful.

Global firms are not customizing their messages to meet local needs or cultural sensitivities.

On average, firms within the financial and retail trade sectors rank among the most effective communicators. Health care, basic materials, telecommunications and other service companies rank among the least effective communicators.

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