www.iabc.com/cw Communication World • May–June 2012 23

In a challenging and dynamic business world,success depends on establishing a clear pathto navigate through complexity. Orga ni za -tions and their leaders—wherever they areand whatever business environment they

face—must be able to chart the right course anddeliver results. We know intuitively—and research con-

firms—that effective leaders can create true com-petitive advantage. Leadership is the top globaldriver of employee engagement, according to the Towers Watson 2010 Global Workforce Study.High employee engagement, in turn, translates to better financial performance: In TowersWatson’s Global Normative Database, compa-

nies with high employeeengagement generateoperating margins nearly1.5 times higher thancompanies with lowengagement. Specific directions

vary according to eachcompany’s strategic im -peratives, but regardlessof focus, the best leaderscreate a clear path for-ward for their people.Towers Watson’s 2011–2012 Change and Com -munication ROI Studysheds new light on how leaders are usingchange and commu -nication pro cesses todemonstrate these lead-ership characteristics.

How do you do it?According to Towers Watson’s Global NormativeDatabase, highly engaged employees at high-performance companies rate leaders as havingthese characteristics:l Principled—driving the company from a sharedset of guiding principles by clarifying values, operating with integrity in everything they do and showing an unrelenting commitment to thecustomer.l Agile—managing the challenges of ongoingchange effectively, and supporting the organiza-tion to evolve in new and innovative ways. l Trustworthy—stressing fairness in decisionmaking and empowering people in their roles.

Leaders who are seen as demonstrating thesecharacteristics use communication and changepractice to produce:l Clarity—conveying the direction of the busi-ness along with ways they can contribute to theenterprise.l Confidence—following a disciplined processfor changing and communicating to creategreater certainty, confidence and engagementamong employees.l Community—building a sense that employeesand leaders are in it together and share both thechallenges and rewards of working.

The Change and Communication ROI Studydemonstrates that effective change and com -munication practices also help the bottom line.Organizations that are highly effective at bothcommunication and change management aremore than twice as likely to outperform thosethat are not effective at either. This holds true

THE CHARACTER OF COMMUNICATIONA new study reveals how leaders use communication and

change management to build sustainable performance

by Kathryn Yates and Sara Vallas

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Whether it’s

about the business

or the employee experi-

ence, there needs to be

a sense of direction

and steps to follow.

24 Communication World • May–June 2012 www.iabc.com/cw

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in any industry, region or economy. Creating a clear direction requires conveying a

consistent story about the business; creatinggreater certainty, confidence and engagementamong employees; and building a shared experi-ence across diverse audiences.

Creating clarity Leaders at highly effective organizations demon-strate their integrity by being clear about thefuture with their employees, even when markets orstrategies are in flux. Whether it’s about the busi-ness or the employee experience, there needs to be

a sense of direction and steps to follow. With helpfrom communication professionals, leaders muststand on firm values and point the way forward.The study found that just over half of partici-

pants are effective at these fundamental practices.Most organizations continue to rely on one-wayelectronic media, such as email or intranet pages,while relatively few ask senior leaders to delivermessages about the organizational culture and val-ues. This is a missed opportunity: Senior leadersand managers are ideal conduits to build commonunderstanding around culture and values. Organizations that do communicate effectively

Towers Watson’s 2011–2012 Change and Communication ROI Studylooked at data collected in April and May 2011 from 604 organiza-tions in various regions around the world. Industries representedincluded manufacturing, financial services, health care, IT and tele -communications, and the public sector.Most questions in the survey used a five-point Likert or effective-

ness scale. Where high and low effectiveness were compared, thestudy showed how many of the organizations designated as havinghigh or low change or communication effectiveness responded tothe item with a 4, a 5 (agree/strongly agree or effective/highly effec-tive) or a yes answer.

Defining communication and change effectivenessHighly effective firms represent the top third of study participants,with the highest overall communication effectiveness or changeeffectiveness scores based on their responses to the survey itemsthat measure these areas. Less effective firms represent the bottom third of participants, with the lowest overall effectiveness.Researchers looked at the financial performance of the companies in the highly effective group to measure the relationship betweenfinancial performance and communication effectiveness.

Assessing effectiveness and performanceIn order to conduct the analysis, participants were divided into threegroups based on their self-reported financial performance relative totheir peers’. The three groups are defined as follows:l High performers are those organizations that report performingsubstantially above their peer group.

l Average performers are those that report performing about thesame as or slightly above their peer group.

l Below-average performers are those that report performing slightlyor substantially below their peer group.

Using this information, Towers Watson confirmed the strong linkbetween change and communication effectiveness and better finan-cial performance:l Companies that are highly effective at communication are 1.7 times as likely to be high-performing financially than com -panies that are not highly effective at communication.

l Companies that are highly effective at both communication andchange management are 2.5 times as likely to be high-performingthan companies that are not highly effective at either.

Effective leaders are authentic, accessible and transparentThe Towers Watson study asked participants to describe the commu-nication skills among their organization’s leaders as follows:

Leaders at my organization are:

Finding the link between communication and effectiveness

Creating a dialogue with employees

Authentic in delivery of messages

Accessible and responsive to employee ideas or questions

49%

49%

72%

71%

24%

28%

42%66%

41%63%

21%

Overall High communication effectiveness

Low communication effectiveness

19%

Transparent in messages to employees

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use a mix of media—includinginteractive electronic media andsocial networking—to reinforcemessaging from the top amongincreasingly diverse and selectiveaudiences.

Leading with confidenceAs the world grows more com-plex, demands more numerousand media more varied, the basis for agility is fundamental,even old-fashioned. The bestorga nizations see an opportunity,build a plan, and are disciplinedin following it, measuring resultsand making course corrections.They engage stakeholders in the process, especially managersand leaders. By taking these fundamental steps, they reducethe level of uncertainty, indicat-ing that someone has a firmhand on the wheel—whichbreeds confidence.Leaders who deliver confi-

dence have a significant impact.Employees at highly effectiveorganizations are 2.5 to threetimes as likely to report that their leaders areauthentic and transparent in delivering messageswhen compared with organizations with low effec-tiveness. In addition, their leaders are accessible andresponsive to employee ideas. Creating a dialoguewith employees takes time from a busy leader’sschedule. However, the data show a good returnon this investment (see chart on facing page). The most productive organizations follow a

disciplined process for change management andcommunication to create greater certainty, con -fidence and engagement among employees.Communication professionals can help the orga -nization set a course, correct along the way andapply what they learn toward future efforts.When compared with companies with lowchange management and communication effec-tiveness, those that are highly effective at changemanagement are nearly five times as likely to create an integrated communication and change

management strategy—and more than eighttimes as likely to continue to exhibit new behav-iors and use new skills after changes are made.

Building communityWhat do leaders do to build community? First,they recognize that a shared experience and pur-pose are important to the business. They under-stand that building trust requires an ongoingconversation. They do not shy away from con-necting with employees, and they have thecourage to address controversy.Most organizations aren’t fully leveraging lead-

ers to create community and grow trust. Two-thirds of all participants in the study report thatthey are using leadership visits to create a sharedexperience among employees, although mostseem to be focused on business results. Whilebusiness results are important, integrating newemployees and seeking key feedback about the

Leading through change

Leadership activities, such as those noted below, are among the primary drivers of overall change success,and they are most important during the planning phase of a change initiative. While most of the studyparticipants reported that they’re effective at finding executive sponsorship for a change, only 32 percentare effective at creating strong employee motivation for making the change happen. Given this insight,it’s not surprising that less than half of participants are able to keep their change initiatives on scheduleand on budget. Rational and tangible activities—like documenting a vision or creating a project plan—areimportant and relatively straightforward for most. Leaders and managers may need extra help with theemotional elements of change that are key to motivating employees to embrace new behaviors.

Effective companies engage in leading activities to drive effective change managementStudy participants were asked: How effective is your organization at the following?

48%

56%85%

37%72%

15%

26%

32%67%

9%

19%84%

Overall High change effectiveness Low change effectiveness

Creating strong employee motivation for making organizational change

Developing a clear vision of desired organizational change

Finding executive sponsorship for organizational change

Creating an integrated communication and change management strategy

about the authorsKathryn Yates is TowersWatson’s global practice leaderfor communication and changemanagement, and is based inTowers Watson’s Chicago office.She has more than 25 years ofexperience in communicationand operations management.

Sara Vallas is a senior com -munication consultant in theSeattle office of Towers Watson.She led the research team forthe Towers Watson 2011–2012Change and Communication ROI Study.

26 Communication World • May–June 2012 www.iabc.com/cw

company’s plans and progress also help build along-term, trusted relationship between seniorleaders and employees. Of course, a healthy community cannot be

driven simply by leadership. It emerges over timefrom a myriad of interactions. Social mediaextend existing social networks beyond face-to-face interaction and enable audiences to segmentautomatically. While social networks are ideallysuited to building community within an organi-zation, overall just over half (51 percent) of thestudy participants use it for this purpose, and onlyabout one-third of those find it effective. Not

surprisingly, among companies that are highlyeffective at communicating, we find a higher fre -quency of use and effectiveness. Social media arealso well suited to support collaboration, and herewe find a similar trend across all organizations.

How do you make communication training effective?Many organizations are training leaders on com-munication and change management, yet fewfind it effective. Here are some guiding principlesthat characterize effective training:l Stay focused and be specific. Document learn-ing objectives, tie them to organizational goals,

and build content around those objectives. l Mix it up. Everyone learns differently, so a mixof learning experiences provides better results.Build a curriculum that includes self-service (e-learning, book summaries, articles, videos)and classroom-based programs. Above all, keepit fun and interactive.

l Take breaks. For instructor-led training, limiteach module to 90 minutes. With e-learning,keep it to no longer than 45 minutes.

In their book Manager Redefined, ThomasDavenport and Stephen Harding note that as

a leader, “your job isto lead your organiza-tion to the promisedland of marketplaceadvantage. This meanslooking behind everytree and under everyrock for a competitiveadvantage.”

The Change andCommunication ROIStudy indicates thateffective communica-tion and change man-agement practices arecore to that advantage.The best recognizethat the demands andpace of change inbusiness don’t always(or even often) coin-cide with employees’needs and capacity

for change. Effective business leaders know this.They understand the benefit of hearing the perspective and counsel of communication andchange professionals—of being not onlyinformed of employees’ readiness for change andcapacity for training, but also educated in thenuances of message, media and manager supportthat mark successful change efforts.Principled, agile and trustworthy leaders use

effective communication and change managementpractices to create a clear path and build sustain-able performance. Helping leaders improve theireffectiveness in communication and change makesgood business sense. l

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learn moreDownload the 2011−2012

Change and Communication ROI Study and an addendum oneffective change management

at www.towerswatson.com.

It’s important to note that change work is not owned by the C-suite. Data show that communication and change management professionals play a critical role. Highly effective firms recognize this fact and involve the internal com-munication function early in change planning. Study participants were asked: When your organization makes changes,at what phase does the internal communication function first become involved in the decision-making process?

Overall High change effectiveness Low change effectiveness

Identifying the problem

or opportunity

Identifying possible

approaches to address the issue

Selecting the approach to

address the issue

Planning the implementation

Implementing the change

Only if a problem arises

Not applicable

14%

9%

22%

10%6%

11%

26%

20%

29%

20% 22%18% 17%

21%

13%

6%10%

2%

7%

13%

5%

Effective companies involve the communication function early in the change process