Effective Communication Improves Financial ROI

The 2005/2006 Watson Wyatt Communication ROI Study™ confirms an earlier 2003/2004 study showing that effective communication is a leading indicator of an organization’s financial performance.

KEY FINDINGS

• 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.

Other Survey Findings

• Two-thirds of the firms with high levels of communication effectiveness are 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.

Improved financial performance begins with linking individual contributor's performance with organizational goals.  Success Performance Solutions are experts in assessing employee engagement and employee comptence.  For more information about Success Performance Solutions, go to http://www.super-solutions.com.

For more information about the Watson Wyatt study:

http://www.watsonwyatt.com/research/resrender.asp?id=w-868&page=1

Comments

[Digitaldoc, MD]

Hello, this was great. I was looking for more info on maybe a model that helps calculate the overall financial impace of HR practices - any thoughts / comments / info and links for the same ?

thanks !