Poor communication in the workplace leaves in its wake low motivation, poor productivity and high employment costs.
Why Communication Practices Are Important
Good communication practices are at the heart of every successful business. Communication serves two essential functions in every organization. It disseminates the information needed by employees to get things done and builds relationships of trust and commitment. Without it, employees end up working in silos with no clear direction, vague goals and little opportunity for improvement. Successful projects and change programs are a rarity and real leadership is scarce.
Staff morale plummets when communication is ambiguous, unfocused, lacking in important details and does not allow for genuine two-way dialogue. Critically, the impact of poor communication hits customers and suppliers. They begin to feel disenfranchised and take their business elsewhere.
Not long ago, the ability to communicate well was viewed as a “soft” skill that was nice to have, but considered not really necessary. In today’s rapidly changing business climate, it’s a mandatory requirement for everyone, from top level executives to the people on the shop floor. Organizations that fail to convey clear strategies and processes and engage employees in shared goals are likely to lose to companies with more effective communication practices.
The Business Impact of Poor Communication
We all feel the personal costs of poor communication when a manager is rude or when we are not invited to an important meeting. However, what are the tangible costs of not paying attention to the quality of communication practices in your workplace? Below, I list the key business costs as a result of poor communication practices. The items on the list may convince you to take a closer look at the practices in your organization.
Increased employee turnover
Poor customer service
Ineffective change management
Failed project delivery
Greater incidence of injuries
Higher litigation costs
Lower shareholder return
This is not the end of the story. Other costs impacting companies include dampened innovation, lower employee productivity and increased incidence of product defects. Communicating effectively both internally and externally to the organization and at all levels of management, without doubt, impacts cash flow and revenue. Communication practices also affect the balance sheet, with the top communicating companies experiencing some 30% higher market valuation compared with their poorer communicating cousins.1
How are your organization’s communication practices? Are your managers and employees equipped with the skills and knowledge to communicate effectively? How are you measuring both the level and quality of communication in your organization and the impacts of poor practices? I invite you to investigate the communication and change management resources and tools on this web site as you embark upon improving communications in your organization.
(For a comprehensive literature review, see Laurel English.10)
- “Connecting Organizational Communication to Financial Performance – 2003/2004 Communication ROI Study” (2003). Watson Wyatt & Company, 3 November 2003
- Brown, A., Duncan, A., and MacDonald, F. (2003). “Proving Communication Impacts Business Performance”, Strategic Communication Management, Vol. 7, No.6, pp 28-33
- Pinnington, Dan (2011). “Communication-Related Errors Are the Most Common Cause of Real Estate Claims”, Slaw online legal magazine,
- Rucci, A., Kirn, S., & Quinn, R. (1998). “The Employee-Customer Profit Chain at Sears”, Harvard Business Review, Vol 76, No 1, pp. 82-98
- “Capitalizing on Effective Communication – How Courage, Innovation and Discipline Drive Business Results in Challenging Times” (2010). Towers Watson, originally published by Watson Wyatt Worldwide,
- “Survey: Poor Communication Causes Most IT Project Failures” (2007). Computerworld Inc.,
- Leonard, M., Graham, S. and Bonacum, D. (2004). “The Human Factor: The Critical Importance of Effective Teamwork and Communication in Providing Safe Care”, Quality and Safety in Health Care, 13, 85-90,
- WarrenShepel [online] (2005). Health & Wellness Research Database,
- Ford, John (2000). “Workplace Conflict: Facts and Figures”,
- English, Laurel (2005). “Tying Employee Communications to Organizational Value: In Search of the ‘Missing Links'” http://www.english-communications.com/downloads/capstone.pdf