How to Communicate Strategy More Effectively

Leaders Must Communicate Strategy More Effectively
An effective corporate strategy identifies your company’s ambitions, clarifies the chosen direction, and specifies the critical few strategic priorities required to achieve its corporate mission.  How leaders communicate strategy more effectively can make or break your ability to successfully execute your strategy.

Even though senior executives and internal communication functions say that ensuring employees feel informed and connected is a top priority:

• Gallup recently reported that 74 percent of employees feel disconnected and believe that they are missing out on company information and news.
• Research by Michael Coveney found that 85 percent of executive teams spend less than one hour per month discussing strategy, and only 5 percent of the workforce clearly understands their company’s strategy.

We have yet to have an employee complain about their corporate strategy being over-communicated.  With that being said, strategy communication is not about volume, slogans, emails, posters, or videos.  Effective strategy communication is about meaning, relevance, frequency, consistency, and actively involving people in honest two-way conversations about:

• What really matters.
• How strategic success will be measured.
• Who does what, and why.

Why Corporate Strategy Communication Matters
Our organizational alignment research found that strategic clarity accounts for 31% of the difference between high and low performing companies in terms of revenue growth, profitability, customer loyalty, leadership effectiveness, and employee engagement.  To create the necessary levels of strategic clarity, you must be able to clearly share, discuss, and constructively debate strategic directions, plans, and priorities.

Clarify, Communicate, and Cascade
The more effectively you clarify, communicate, and cascade your business strategy the more likely it is to be implemented as planned. But you may not currently be relying on the best way to pass along what matters most. There’s new research that could point you in a better direction about how to communicate strategy more effectively after your corporate strategy retreat.

Strategy Communication Research
Remember the old-fashioned game where you communicated via tin cans and a string? And there was also that other telephone communication game where one child whispered to another who passed along the message to a third and so on. By the time the message reached the end of the circle, it was almost always unrecognizable from the original version.

This example illustrates one of the risks of relying too heavily on the cascading principle of communicating your organization’s business strategy.

Several years ago a major 60,000 response study was conducted by Charles Galunic of Insead and Immanuel Hermreck of Bertelsmann to better understand how strategy could be most effectively communicated across the workforce. Here are the high level results — some expected and one quite surprising to us.

1. Seniority and Engagement Play a Role
   The strategy was better understood by (1) higher-level employees, (2) employees who were happily engaged in their jobs, and (3) employees who had an overall positive view of their company. This made sense.  Engaged employees and those with a lateral view of the organization typically have an easier time understanding, digesting, and implementing new corporate strategies.
2. Tenure Did Not Matter
   Long tenure at a company did not necessarily predict that the employee would “get” the strategy better than newer hires. This was interesting to us because some leaders mistakenly assume that newer employees need more hand-holding when it comes to strategic change and execution.  Based upon project postmortem data we believe that it is often more difficult for tenured employees to think and behave in new ways or to adapt to new circumstances.
3. Career Advancement Opportunities Skew Strategic Buy-in
   Job conditions, especially opportunities for further career development and a clear career path, strongly affected how well understood and supported the strategy was among employees. We found this result interesting.  It tells us that leaders should ensure development opportunities and career paths are adjusted and aligned with any strategic changes as part of the strategy communication and cascading process.
4.  Confidence in Senior Leadership Matters
   Similar to results from our organizational culture assessments, confidence in top management was a significant factor. Employees need to understand the company’s plans for future success, believe the organization will be successful in the future, understand how their job helps the organization achieve success, and know how they fit into the organization’s future plans.  In other words, people need to believe the message and the messenger.
5. Direct Manager Strategy Communication is Not as Important as Senior Leader Communications
   And, finally, here, from our perspective, is the most unexpected result of the survey — direct managers play a far less important role in strategy communication than company leaders.  While employees want help in translating the strategy to their role from their direct manager, they want to first hear the overarching strategy from the top leaders that created it.  Employees like to hear about company strategy from those who are most in charge of crafting it and making it happen — firsthand, not second- or third-hand.

   Employees want to hear the “real version” from the executive leaders in charge. They want the straight, unadulterated version, not one that has been watered down and re-interpreted through the cascade of information dissemination.  Senior leaders have the authority; they have the credibility; they are in a position to know; and they have the answers to employee questions because they are (or should be) the company’s business strategy experts.

The Bottom Line
If you want to communicate strategy more effectively, senior leaders need to take charge and play THE major role in communicating the strategic direction of the organization. Don’t rely on old-fashioned, unproven methods of communicating the strategy that will guide your company into the future. The message is too important to be garbled by ineffective, inexperienced, or misaligned messengers.

To learn more about how to communicate strategy more effectively, download The 3 Biggest Mistakes to Avoid When Communicating and Cascading Your Corporate Strategy