WHITE PAPER - How to address the key issues for measuring Internal Communication effectiveness - 2014

Summary:
Many professionals working in Internal Communications struggle to document and analyse challenges they face and the results they deliver. This white paper looks at the issues for measuring internal communications effectiveness by answering five simple questions; why measure, what to measure, how to measure, how to analyse and how to drive action? The paper offers practical advice on how to approach measurement and aims to enable professionals to conduct better and more focused research in order to demonstrate how they deliver business value. A key point of the paper is that effective internal communications not only requires tracking and reporting of past efforts, but it also entails profound analysis of key issues and what actions are needed to mitigate risks and to capture opportunities.

Authored by: Klavs Valskov, see more at valskov.com

INTRODUCTION Since the financial crisis, leaders are more than ever running their organisations on data and numbers. That means airtime in the boardroom is given to the teams that are able to supply issues analysis, peer comparisons, SWOT analyses of markets, forecast models and future scenarios based on objective evidence. People who can talk about threats and opportunities and make suggestions from a position of analysis and insight get listened to. Yet many professionals working in Internal Communications continue to struggle with the ability of providing documentation and analysis of the support they deliver. There could be many reasons but in conversation communicators often admit to a discomfort working with numerical information At this worst, this could mean that many Internal Communication teams do not really understand how effective they are with their activities, know how to track their progress, spend time on predicting scenarios and think about what actions that can best help navigate them. This white paper seeks to address these issues and offers a practical process to follow. The aim is to break down what seems to be somewhat of a challenge to many practitioners into an accessible method that should help most to get started with measurement and how you get it right. The paper follows a simple structure by answering five questions through which the key issues of measuring Internal Communication effectiveness is addressed:

1. Why measure? • How can conducting effective research and analytics provide better insight to help you improve your impact as an Internal Communication professional?

2. What to measure? • Where should you be focusing the content of what you measure and analyse?

3. How to measure? • What methodologies can you best apply to gather the right data?

4. How to analyse? • What should you do to create real insight from your collected numbers?

5. How to drive action? • How can you convert findings into actions?

WHY MEASURE? Without suggesting that we all should start wearing stethoscopes and carry an abacus around, it is indeed necessary for communicators to bring data to conversations with leaders. From our experience, there are four core reasons as to why practitioners in Internal Communication ought to be conducting more effective measurement of their activities:

1. You need to assess your effectiveness A communication manager should both be measuring activities (outputs) and results (outcomes). A good place to begin is to gain understanding of how technical efficient you are being. Keeping track of outputs such as intranet hits, video views, town hall attendance, etc. is often metrics that are easily understood by your stakeholders – and it is expected that you be completely on top of what takes place in the communication infrastructure under your control. Often this type of data is also relatively accessible. However, organisations need to see that the communications activity is having a beneficial impact. These results or ‘outcomes’ can be slightly harder to measure. It is not always easy to see the relationship between the work of communications and changes in customer service behaviour, understanding of safety rules or improvements in sales leads for example. Making those connections help drive senior decision-making in a powerful way. To improve the impact of your research you can begin to measure the effectiveness of for example: • Communications channels: is your intranet or your briefing cascades more effective in helping people understand the strategy of the organisation? • Transparency in the organisation: have senior leader town-hall meetings or CEO webcasts given employees a more genuine understanding of the issues facing the firm in a current crisis? • A particular campaign: has the way you launched the new vision and values had a bigger impact on middle managers or on front-line customer service colleagues? Are sales reps aligned on what not to sell anymore? Remember that measuring the satisfaction of employees with aspects of your delivery however is not likely to provide you with much value. Just because someone is “satisfied” with a briefing mechanism doesn’t necessarily mean they will act differently on the information they have been given.

2. You need to track your progress If you set yourself a goal you need to know not just when you have reached it, but also how you are progressing towards it. Are you moving too slowly? Are you managing to deliver the tools you set out to do? Are your messages being misunderstood and in need of refocusing? You need to understand how you are performing as well as create a framework for capturing opportunities and spot threats. Running an efficient Internal Communication function means that your research is never a one-off exercise. As you develop your plan and implement your activities, you should be gathering data to track your progress. So, for example, you may want to track: • Improvements in employee engagement: are the levels of engagement rising in the organisation, amongst whom and driven by which factors? • Changes in message penetration: is your new brand promise being understood and delivered by a growing number of your people and where in the business is it proving harder to get traction? • The impact of a new channel: is a new internal social media mechanism helping to connect people across the firm over time and generate improved collaboration as it takes hold and communities form? • Better clarity of brand promise: is the customer satisfaction improving quarter-by-quarter as a result of your efforts to build alignment and excitement among your customer-facing colleagues? This can take several forms: tracking surveys (regular annual or semi-annual trackers), “Pulse” approaches (more frequent, shorter and punchy sample surveys), or more live feeds of data (from social media feeds, employee panels etc.). 3. You need to predict outcomes The smartest research not only allows you to assess effectiveness and track progress on your communications activity, it can also help you to predict outcomes. This moves you away from descriptive numbers (describing the current state) and helps the organisation to understand potential threats and opportunities. And it provides a basis for assessing scenarios if certain improvements are made (predictive models). For instance, this approach might help you to: • Assess what the key drivers of overall communications effectiveness are: does message clarity, tone of voice or perceived transparency have a greater impact when you go out to your employee base?

• Understand how you can best segment your communications to have an optimum effect on particular audiences: how can you best engage with front-line customer-service representatives as opposed to middle managers? • Assess the impact of communication on particular business KPIs: for example, what impact does the level of engagement with a new set of values have on levels of labour turnover, customer service delivery or unitlevel profitability? As part of building your mechanisms for gathering data and analysing them, you will also experience the power of historic data. Having insightful data from previous events will become an invaluable source to help you build scenarios and provide advice. 4. You need to demonstrate ROI to argue your business case Predicting issues and suggesting improvements in itself builds credibility for your communication function. This will more clearly show how much impact your activities are having on the key areas that matters to the business and thereby demonstrate the return on investment (ROI) that you are creating. ROI is a hot topic these years in communications circles. Whilst there is agreement about the need to show a link between resources spent on communications and the business benefits there is considerable debate about methodologies to calculate ROI. The most common point of dispute seems to be around the assumptions needed to make the numbers work. For example, is it real bottom-line impact when you improve intranet navigation and search functionality? Is it a true cost saving? On the other hand there are also assumptions being made when you build financial return-on-investment models for allocating capital or if the company is considering purchasing new machinery. Our point here is that it is near impossible to build evidence that can tell an absolute truth, not only in Communications. But as professionals we have a responsibility to bring about assessments and insights that our leaders can make informed decisions upon. These demonstrations of impact and improvement furthermore make it easier to argue for increased investment in resources, activity and interventions.

WHAT TO MEASURE? When measuring internal communications there are essentially three layers which becomes progressively sophisticated and difficult but there is much value with each point. Following on from the previous section about why measure in the first place, a good starting point is to understand and analyse your activities to see if you are being effective. Next is if you are making progress which largely is about whether people are getting the message and how they respond to it. And the final thing to measure is to see if anything has changed as a result of your intentional efforts. Combined they creates the platform for the more profound predictive modelling that we also spoke about above. Many teams find it easy to check click rates, attendance and the number of downloaded toolkits. As much as it is a great training ground to start exercising your data gathering skills, it can sometimes end slightly misguided and actually not truly measure your effectiveness. Simply because you are not measuring what is critical to the business. Knowing what to measure means that you need to start by understanding the organisation you work for and what is critical for its success. From there you define what the objectives for internal objectives should be which then shapes your core activities to get there. Together this then helps define what key metrics are relevant for you to track, report and analyse. In simple terms, you should follow these steps to understand what to measure: 1. What is your organisation trying to achieve? They are typically things like sell more products, make bigger margins, operate effectively with lower costs, hurting fewer people in the workplace, retain skilled staff, finding simpler ways of doing things, reduce impact on the environment, treat customers nicely or win trust of the community 2. Then work out what effective internal communications would look like to help achieve those business outcomes. It is important that these, typically 3-5, key objectives are defined in a measurable way and a good idea is to have one communications objective per business value driver. Remember that you don’t need to address all the critical business drivers. You can’t save the world all at once 3. Then assess what relevant outputs and outcomes you need to measure and track over time. And do the performance correlate with each other and other parts of the business? Seek for possible links where there seem to be a connection. Also think about using benchmarks and peer comparisons to establish a context for your metrics.

When you need to define your relevant metrics it might be difficult to know where to start. Internal Communication is essentially about helping employees feel part of a community, work hard in support of its values and goals, speak positively about their jobs and be supportive of change. These could for example be measured through understanding affiliation, intention to leave, advocacy and understanding of what is expected of them. Following on from this driving Internal Communication typically means creating awareness, building understanding and acceptance, initiating excitement and hopefully driving behaviours. Data gathering should therefore begin and end with this model: what do we want people to know, what do we need them to understand, what level of enthusiasm, excitement or personal commitment is necessary and finally what do we want people to differently as a result of communications? Asking these questions will soon guide you to the process relevant for your team. To further help guide your thinking about what you should be measuring it can be helpful to think about your core issues from another dimension. Think of below as kind of checklist that generally is worth focusing on in your research design: 1. Channels: Which of your communications channels are proving most effective to achieve a certain goal? For example is a face-to-face briefing or a written pack going to be more effective in getting the key messages about the new strategy across? 2. Messages: Which of your key messages are landing and which are people still unclear about? For example are colleagues more aware and showing better understanding of the vision than first expected? Are people clear about how the messages relate to them and their daily jobs? 3. Culture and behaviours: How are key communicators behaving and what culture is that amplifying? For instance are middle managers being supportive of the change really needed to achieve the new vision – or are they blocking it? How might that be addressed? 4. Audiences: Which of your audiences are you having the most impact upon? Perhaps face-to-face briefings and information packs work well with Baby Boomer and Gen X employees whereas Gen Y (or Millennials) demand information through social media and peer-to-peer mechanisms.

HOW TO MEASURE? A wide range of tools and techniques are available to evaluate internal communications activity and effectiveness. Tried and tested methods, whether they be quantitative (e.g. surveys) or qualitative (e.g. focus groups, interviews), are often the starting point. Often there will also be valuable information that exists already inside your organisation. The key to effective measurement though is bringing together a mix of approaches and tailoring this to different levels in your organisation. Combining methodologies provide you with a very thorough analysis and secure you a validated level of insight to base decisions upon. Furthermore, you want to consider what type of audience your respondents are. For instance an online survey may best involve employees across dispersed locations, whereas interviews may allow you to probe into the attitudes and experiences of senior leaders. While these tools won’t be disappearing any time soon, new methods of on-going data collection are also complementing structured research. Sound research requires measureable data to help benchmark and track progress. Of course a number of factors will influence what is practical for you – the level of detail required, the available time and resources, access to your employees and your budget. Whichever methods you choose however, the data you collect is only as useful as the analytics you undertake.

HOW TO ANALYSE? Wouldn’t it be ideal if numbers told us the whole story - if as communicators we didn’t have to interpret data ourselves, but instead be provided with conclusive findings following each research or evaluation project? Sadly, collecting the data is only half the story – context always adds another layer of understanding. Now you need to plough through the answers to make sense of what you are being told and see what patterns you can draw up. Luckily, when it comes to analysing data, there are techniques that will get you closer to a fuller understanding of what the results are telling you. One of the most crucial elements of good researching is that you think about how you intend to analyse the results before designing the questions you intend to ask – and how you might want to correlate the answers from several questions (i.e. are staff that are more exposed to face-to-face communication with their leader more likely to advocate the company as a great place to work for friends family?) While there is no one perfect approach to evaluate communications effectiveness, Meng and Berger (2012) outlined the following metrics that can be measured on a regular basis: 1. Increased employee awareness or understanding 2. Improved job performance 3. Employee behaviour change 4. Effect on employee engagement 5. Effect on business performance (e.g. revenue growth, customer satisfaction) Measuring return on investment (ROI) of organizations’ internal communication efforts (2012). Journal of Communication Management, vol. 16 (4), 332-354 More and more there is the requirement to prove that what Internal Communication teams are doing is having an impact on the bottom line. In 2009, Melcrum’s Key Benchmark Data for Communicators study found that only 15 per cent of professionals working with internal communications believed that they were able to demonstrate the financial return on their activities. Just over 50 per cent reported that they were unable to do this and the remaining 35 per cent were unsure. While there is a lot of anecdotal support that the Internal Communication function provides value, we’ve found that the facts don’t really hit home until leaders see the evidence it in relation to their organisation. It’s all about measuring how internal communications matters to the broader business.

HOW TO DRIVE ACTION? Sadly, even good research sometimes hits the buffers. The most common complaint we hear from professionals after conducting research is that “nothing really happened”. Unless great data and analytics drive action and improvement, the whole thing has been a wasted investment and is likely to lose credibility at senior executive level. The point of measuring is that you continuously track your efforts while staying tuned in with your audiences – and then act accordingly. That is how you stay effective. The reason why research efforts sometimes end in a blind alley can commonly be linked to three causes: 1. Data overload: Most research studies produce a vast amount of data and Internal Communication research is no exception. Never-ending slide decks and spread sheets quickly make you lose the will to live! Instead you should use Smart Analytics to boil down the key points of your data: the things that matter – as opposed to just describing every data point from multiple angles. You need to use data “condensation” techniques to help this. You may also find producing a simple dashboard can help – more about this below. 2. Lack of focus: The vast majority of data we still see from in-house studies is purely descriptive: endless bar charts describing the current state. This is a useful starting point but does not create any focus for action planning and change programs. The use of the smart analytical techniques we have described can help to generate much clearer focus and get action planning on the right track. Knowing your strategic priorities, the key drivers of Internal Communication effectiveness within your own data and what will enhance ROI are vital to achieving this. 3. Lack of guidance: Those who will need to do something differently based on the research (communication managers, line managers, senior leaders) need to be given strong and precise guidance to move from data through insight to action.

The Communicators’ Balance Sheet A useful method to drive action is to create a balance sheet for your function. Follow the process as we outlined above under ‘What to measure’ by understanding what your organisation is trying to achieve and what key communication objectives will influence what business value drivers. This sets the framework for what metrics that are relevant to track and report on.

In order to be effective with your activities then aim to fulfil these objectives. Obviously you will only know this when you over time assess outputs and outcomes. Now you have a clear steer on what data drivers to focus on. This periodic health check, which we recommend takes place quarterly perhaps following your organisation’s financial interim reporting heartbeat, allows you to take stock of how you have performed so far and what adjustments you need to make. To keep the quarterly exercise simple our experience is that dashboards presenting the key data help shape the analysis and the action-planning discussion (see example below).

The next important step is the actual action-planning process. On the input side you now know what your organisation is trying to achieve, you know what your success criteria are and you have the key data collected, both on how you performed plus other listening data that has been flagged as key issues that need handling. To help frame the analysis and the action-planning we find it useful to follow four simple steps:

1. What were our key accomplishments? 2. What are our opportunities? 3. What risks are we facing? 4. What key actions do we need in the coming period? This focused approach allows you to zoom in on key issues and discuss, first internally in the Communication team and afterwards with stakeholders, what may be the relevant actions to take based on the insight provided. The balance sheet can be designed and structured in a million different ways. A good rule of thumb is to think about not making it too comprehensive, but more of a simple overview. Recently we worked with a leading global financial service provider to help them establish a template to harvest key insight with and set up an actionplanning process. We laid down a few key principles for building the dashboard that could serve as inspiration:

Why do we measure? i.e. to assess performance and improve it What to measure? i.e. how strategic messages reach and is understood by each employee How do we measure? i.e. quantitative/qualitative methods, sources When do we measure? i.e. the resource issue Who owns measurement? i.e. assigned task to someone Where do we keep it? i.e. public or hidden Who is this for? and why should they care i.e. consider this as a communication piece in itself.

During an intense process of constructing this report it was useful to keep coming back to these. What we had just as much in focus was how to make the insight actionable. Here we followed the steps outlined about and structured key findings alongside key suggestions for actions. They are today following a quarterly process where they collect data according to their overall communications objectives and how they link to the business’ needs. This includes their recent activities plus the feedback they are hearing – and then findings are synthetized with peer comparisons and other benchmarks. Once established the insight is discussed internally in the Communications team where actions are then agreed. Those actions are then put forward to the executive management for discussion and approval.

CONCLUSION In this white paper we have aimed to address they key issues of measuring Internal Communication effectiveness by answering five questions. In terms of Why measure we outlined that there are essentially four reasons: 1) you need to assess if you are being effective, 2) you need to track if you are making progress, 3) you need to be able to predict likely outcomes, and 4) you to demonstrate that you are delivering value to the business. When it comes to What to measure the key filter you need to establish is firstly to understand what your organisation is trying to achieve. Then decide what Communication objectives that could support these. Combined this then sets the frame for what is relevant to measure and what the ambition for your measurement efforts is. The actual process of conduction measurement we covered in How to measure with two key points: Always think about combining methodologies to cover one issue and consider what type of research method your audiences might prefer. In How to analyse we proposed a three-leveled approach: At the first Descriptive level you uncover trends, at the second Focused level you understand how you can become more effective and at the third Integrated level you understand what impact communications are having on the key drivers that matters for your business. Finally, we suggested in How to drive action a quarterly rhythm where you assess effectiveness, track progress and predict outcomes. We furthermore suggested the use of dashboards presenting key findings together with a simple action-planning analysis that recaps key accomplishments, opportunities, risks and what key actions you are suggesting. Following this process will ensure that you stay focused in your efforts on what matters most to the organisation you work for. You will demonstrate value and ROI because you continuously adjust to be most effective and you bring about insight that business leaders can base decisions on.