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7 Reasons Why Internal Communications Is More Important Than Ever

Workforce demographics are changing. As baby boomers retire, millennials now make up the biggest part of the workforce and are moving into management positions. At the same time, members of Generation Z are starting to come out of college and move into their first full-time jobs.


While generational categories might often seem too simplistic, there's no escaping from one underlying truth that they reveal: Each successive generation from millennials onward has been more and more demanding, especially concerning the ways their employers talk and listen to them. They expect fewer office politics and increased collaboration, transparency, and feedback.


Creating an Engaging Workplace

The larger concept that has evolved out of these new requirements is called employee engagement, which has become a major trend (some might even call it a buzzword) with more than eleven million hits on Google. But the term shares the same fate as other broad concepts: nobody knows exactly what it means, making it difficult to define concrete actions for improving it.


However, there is one major part of employee engagement that is a highly actionable—internal communications. Companies spend large amounts of money and resources on their external relations and communication but often neglect internal marketing and communications to their employees.


Free eBook What's the best internal communications tool for 2018 


Here's why internal communications is a key business function and is now more important than ever before:


#1 The Drive for Purpose

When we were children we used to ask our parents the question “Why?” at least 250 times a day. And it seems not much has changed in that department. The quest for a sense of reason and purpose has followed us until today.


This certainly applies to our working lives. Employees want to know their goals, understand the plans for getting there, and be confident about the value of their contributions toward those plans. They want to feel valued, listened to, and part of the team. This is especially true for millennials and Gen Z, who rely heavily on feedback and interaction. Having grown up in the age of social media, they're used to a constant flow of likes, sharing, and comments.


But purpose isn't limited to showing employees their goals; it also includes visualizing the actions that each and every person can take in order to contribute. It is, for example, highly effective and motivating to regularly post and share information about what a team or company has achieved. Reaching set goals together increases the feeling of teamwork and progress.


Smart goals, internal communication


Create great goals that are SMART: Specific, Measurable, Attainable, Relevant, and Timely.


"73% of employees who say they work at a "purpose-driven" company are engaged, compared to just 23% of those who don't." In addition, a recent global survey of 26,000 LinkedIn members, taken by the research firm Imperative, found that 73% of its participants want a career in which they feel that their job matters.


A well-functioning internal communications system can motivate employees to work toward a common goal. By letting them in on the “why,” companies can significantly engage them in the “what.”


 #2 Remain in Control of the Message and It’s Origin

Employees should never learn about important company news from an external source. The new reality is that news is accessible on our smartphones and other mobile channels anytime, anywhere. This situation intimidates many companies, but the only way to deal with it is by learning to match that external speed and to make internal points of view readily available—not just during crises, but also in day-to-day operations.


2005 vs 2016, internal communication, social media, smartphones


Two main ingredients are needed to ensure that information comes from the right source, is timely, and reaches all employees:


First, a well defined but flexible and fast editing process with a short approval chain up and down the hierarchy. Designing such a structure is similar to the challenge companies faced a few years ago when they had to define processes for social media to respond to a critical tweet within minutes or hours—not days.


And second, organizations need to establish a fast, interactive, and reliable channel to reach all employees. Fast and interactive means digital—and today digital means mobile. As in many other cases, a combination of new procedures, skills, and technologies are needed to create trust and transparency. This enables companies to remain in control of the messages they send, instead of leaving information susceptible to individual interpretations.


 #3 Empower and Support Middle Management

Most companies cascade information top-down through their hierarchies. The trickle of information that follows this concept often results in delays, limited feedback, and a complete dependence upon the individual efforts of each person in the chain.



OutgoingMessages, internal communication, support middle management



Plenty of messages are going out—the problem is that most of them aren’t reaching the people who actually do the work. Internal communication can make this chain much more effective.


Empowering middle management at all times with the required resources and information available will allow them to be the best possible leaders and communicators for their staff. In addition, providing information that isn't team-specific through a location-wide or central communication channel will lighten the burden on middle management.


Internal communication presents a valuable opportunity for companies to understand their workforce better and, hence, train better managers. This is especially important for millennials, since they often feel ill-equipped for their new roles.


Millennials Feel Unprepared for Management Positions

Although millennials have the highest number of college graduates according to a recent Randstad and Future Workplace study, many feel unprepared to solve conflicts, negotiate, and manage other people. They feel like they don’t have the required soft skills and aren't capable of overseeing older generations.


Good internal communication helps on several fronts, not only to better understand a workforce, but also to enable two-way conversations.



Millennials not prepared to be manager, internal communication



#4 Keep the Brand Promise and Satisfy Your Customers

Your customers expect your brand to deliver on its brand promise. Always.

This is true for consumers and business customers. How do companies make sure that this works in a large distributed organization with hundreds or even thousands of middle managers? They do it through internal communications with your frontline employees.


Clearly-communicated goals, well-trained and informed staff, and happy faces will significantly improve a customer's encounter with the brand and, consequently, enhance revenue.


"Customer experience is the most pressing mandate for marketers, the top area of marketing technology investment in 2016, and it will lead innovation spending for 2017."  A Gartner survey has found that by 2017, 89% of companies expect to compete mostly on the basis of customer experience, versus 36% four years ago. In addition, by 2017, 50% of consumer product investments will be redirected to customer experience innovations.


Great brands are built from the inside out. Start with your employees and their satisfaction and confidence will be mirrored directly onto your customers.



#5 In a Crisis, Internal Communication Holds Everything Together

Timely and careful communication is key to mastering an internal or external crisis. The way that your employees and external stakeholders view an incident (negatively, neutrally, or positively) is a major factor in whether or not the incident develops into a full-blown crisis. However, internal crisis communication research has found that managers often communicate significantly less with employees during a crisis.


Internal communications channels.jpg

Time-critical communication relies on effective channels that need to be in place in order to reach a majority of employees.


Not only can internal communication help you steer people's perceptions about a situation, but it also supports short- and long-term crisis management. Short-term management addresses the incident itself, while long-term plans are more focused on preserving the company's reputation and enacting measures in order to prevent negative situations from repeating. By putting organisational structure, plans, and channels in place before a crisis hits, internal communication will allow you to handle crisis situations, no matter the size, reputation, or industry of your company.



#6 Create a Better Work Environment

A better work environment will help companies on two fronts: Avoiding high turnover rates, and attracting new talent.


Turnover rates are increasing and cost the American economy $3 billion annually. Millennials in particular are known to job-hop. Up to 40% say they are willing to change their position within the next two years. It’s now the company’s job to make them stay. "Good internal communication provides constant feedback and purpose which increases the employee engagement which in turn decreases turnover rates and ultimately saves the company money." 


Whether you're trying to attract talent or retain it, employees need to know their employers. A well-functioning internal communications system and the open work environment it creates will give your company an edge in today's highly competitive market.


Ultimately, there's no better advertisment for your brand than happy employees and happy customers.


#7 Limit Rumors and Enhance Transparency

Informal communication has its advantages and disadvantages. Grapevine word-of-mouth can sometimes help employees to interpret managerial information; it often reaches those who might have otherwise missed the original transmission; and it's more flexible than formal communication. In addition, the grapevine helps to improve relationships between employees and it spreads knowledge and tips that can make work more effective.


On the other hand, informal communication can distort the meaning of information; it supports rumors and misunderstandings; and it's difficult to control.


Good internal communication can help increase the advantages of informal communication. It will slow down the rumor mill by communicating timely and frequently, and it will help employees to interpret information as well as instructions.


Employees put a high premium on transparency in their interactions with different levels of management, going as far as naming it the top factor in determining their happiness and satisfaction in the workplace.


Providing both—a rumor-free environment and transparency—is central for a generation of employees (and customers) who are skeptical to the core.


internal communication circle


The Importance of Internal Communications

"Effective internal communication is a powerful force that helps enrich employees’ lives and, hence, leads to a 40% increase in customer satisfaction, a 30% increase in profitability, and a 36% increase in the overall performance of the company."  Talking to employees is no longer the younger brother of external communications. It’s a key business function that inspires and aligns your whole organization. Internal communications professionals need to raise the bar and confidently put their ideas on the boardroom agenda. 


A 2016 Internal Communication Survey found that IC budgets are more likely to be growing than shrinking in the years to come. In fact, 87% of the participants expect that budgets will either remain at present levels or increase. With the top-down hierarchy slowly unraveling and younger generations moving in, internal communication and employee engagement are two topics that are here to stay and should be at the top of every company's list of priorities.


How is your organization dealing with the changes in internal company communication? Drop a comment into the section below. We'd love to hear from you!  

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Feel free to contact us if you'd like more information on how to elevate your internal communication. You might also be interested in the following articles:


Written by Sina Kaye Lockley

Sina is a communication specialist at Staffbase. She wants to help companies engage their employees and find ways to make work more fun. She writes about internal communication, mobile employee engagement and how to use an app in today's evolving workforce. She religiously reads one book a week and sleeps with pen and paper next to her head.