Why communicative participation of employees is so important for businesses

Series: Participation in the intranet, part 2

There are at least three good reasons why many companies can benefit from increased employee participation in the intranet: used properly, it leads to an increase of productivity, agility and controllability.

Productivity

After consulting firm McKinsey  had  analyzed several thousand enterprises worldwide for five years, they published a study in 2012 drawing the conclusion that knowledge workers could increase their productivity by 20 – 25 percent, if they made proper use of social software. They found that two thirds of the potential added value of social technologies resulted from improved internal communication and collaboration, leading to employee skills better finding their way to the departments where they are needed most (‘matching talent to tasks’).

It is important to note that successful participation in the intranet doesn’t only depend on technology but on quality and quantity of social interactions. While IT is necessary to facilitate the required speed and coverage of interactions, the exchange will only take place if supported by a culture of cooperation and  the willingness to participate. According to McKinsey, this willingness to participate is decisively encouraged when executives act as role models and the use of software becomes a regular part of the work process.

Agility

Participation has, however, not only the potential to increase productivity, but it can make companies much more flexible. Change management expert John P. Kotter thinks it is critical because in times of constant change hierarchically dominated management methods aren’t fast and agile enough. Hierarchical processes work well for the recurring demands of daily control of a company, but when it comes to being continually on the lookout for new solutions, they are too clumsy.

Hierarchy and network_11072015

Exhibit 1: hierarchy versus network

As a result, Kotter proposed to introduce, parallel to the traditional hierarchy, a second ‘operating system’ for companies that works like a network. While hierarchies proceed according to established rules and processes that have been optimized for the most efficient handling of known tasks, network resources can be re-assembled again and again responding to changing requirements. In a hierarchical organization, the management focuses on administration and control of the system. The management of a network, however, motivates to find new ways and  is more fault-tolerant.  In a hierarchy, communication is mainly top-down, in directives which are sent via the cascades of the organizational chart. The communication in networks on the other hand runs in dialogues that, according to requirements, may run criss-cross  through the organizaton. What matters here, is how valuable the contribution is for the new requirement, not where it comes from.

Hierarchy and network as dual operating system

Kotter’s point is not to replace hierarchies by networks, he rather wants to create a ‘dual operating system’ in which both organization models complement each other. Reliable day-to-day business and ongoing innovation should be able to coexist. The participation of employees plays a crucial role for the success of the network. To allow for rapid change, Kotter recommends  to involve as many employees as possible on a voluntary basis. Volunteers set to work with a ‘I want’ instead of ‘I must’ attitude and contribute to cost-containment to boot. In return, they want to be involved in change, not only be affected by it. To this end, it is necessary to exert a leadership style that  works with motivation and appreciation instead of delegation and budget control. According to Kotter, leaders on all levels must be involved to establish the network as legitimate part of the organization.

I consider Kotter’s approach very productive because it reflects the reality of business. Every business needs hierarchies to remain efficient and capable of making decisions, especially when it has reached a certain size. And every business needs network structures in order to adapt to the ever-changing environment. Kotter presents a model in order to mediate this conflict of objectives and illustrates the crucial role of participation for companies to cope with the constant pressure to change.

However, what Kotter describes as ‘dual operating system’ also seems to be dualistic, because network and hierarchy are working  in parallel without being truly integrated with each other. The connection between the two is primarily  based on the personal union of employees  who play a role in both systems and as a result have to settle the conflict of objectives in themselves. I believe that decision making hierarchy and networking culture can be reconciled in another way and by doing so improve the controllability of the organization.

Controllability

Increased employee participation allows for management to gain new insights into the state of things and based on that for making more informed decisions. More informed decision making improves the controllability of the organization as a whole, but it also brings a new quality to communication controlling in particular, because with participative internal media it can be measured how messages resonate in the organization.

Closed loop of internal communication

Exhibit 2: Closed loop of internal communication

Exhibit 2: Closed loop of internal communication

Traditional internal communication mainly serves as the mouthpiece of the executive board. It shapes messages dealing with the ‘targets’, the goals and plans that management want to reach with the organization. And it coordinates the distribution of these messages along the hierarchy, from top to bottom, through the cascade and traditional internal media such as the staff magazine. While this management of messages is well tested and established, internal communication so far had little opportunity to find out how they resonate in the organization.

 

With the participation opportunities enabled by social software all this has changed. Now it can be determined how much of the messages has actually come through and where there is still need for reinforcement. Horizontal networking makes opinion-shaping processes visible which were in the dark before . With employees openly cooperating on the same project or exchanging views on the same field of interest (‘peer-to-peer’), new internal publics emerge which serve as means for knowledge exchange but also show where the organization stands with its projects. Depending on the internal social media landscape, the actual state of things can directly emerge from observing the exchange or can be purposefully collected as social intelligence from the bottom up. Thus a targets-actuals comparison is facilitated that shows how far apart plan and reality are and what is needed to close the gap between the two. Through the communicative participation of employees a loop is generated that makes the internal communication significantly more controllable than it was with a silent audience.

However, participation in the intranet doesn’t work like grasssroots democracy. There are different levels of participation and formats with active influencers and more passive followers. Internal communication has to adjust to that with appropriate models of participation, and we’ll look into those over the next couple of posts in this series.

 

Some thoughts on the future of PR

Social Web World in Germany did a series of interviews on the future of PR. Here is an English summary of my bit:

What is the main task of PR chiefs today? What will it be in five years?

Let me just make a preliminary note on questions regarding the future of communications. Back in 2004, “blog” was the term most searched on the US online dictionary Merriam Webster. Five years later, 15.8 % of Fortune 500 enterprises had a corporate blog. In 2004, at the peak of the blog hype in the US, many would have expected a higher rate than this, but from a long term perspective it can still be seen as a remarkably fast adoption. In other words, at the peak of a hype – as currently is the case with social media in Germany – it’s easy to fall into one of two traps: you either underestimate the change (“it’s all hype, nothing will change”) or you overestimate it (“everything will change”). The truth is generally somewhere in between, and that’s where my attempts to touch on the future will go, more like a compass than exact directions.

Today, the main task of PR chiefs is to build and protect the reputation of their companies or organisations, with the perception by traditional media being the major focus, considering the company as a whole, its products, its economic situation and – not the least – its leadership. A significant part of the attention is also dedicated to planning, resource management and leading the own team or external service providers PR chiefs are working with. I do believe that all this won’t change over the next five years, but I also do expect an extension of duties and considerable shifts in focus:

  • More direct communication: With the advent of social media, everyone with internet access potentially has a public voice. As a result, the one public determined by traditional media is complemented by many new publics influencing the perception of companies. These new publics expect to be addressed directly. As a result, PR as a whole is getting more interactive and more holistic. It again has to deal with all publics, not just the media. And in addition to the publics of the old school of PR, new, virtual publics are emerging that didn’t exist before. This results into two important questions for the PR organisation: 1) Which online voices are at all relevant for the company? 2) How is efficient communication in this environment of potentially thousands of voices possible with limited ressources?
  • More technology: In the future, PR chiefs don’t have to be nerds or software developers, but they need to know on which platforms new publics emerge, which of those are relevant to the organisation,  and how they can be used for efficient communication. Being familiar with communication technologies will be of growing importance for PR chiefs both for daily work and for education. This development is fostered by communication technology more and more becoming a life style, not only for the young.
  • More integration: More direct communication also entails more integraton. If companies increasingly communicate with all publics directly and interactively, there is more coordination needed between the departments involved, in particular between PR, marketing, and customer relations. This will also change the organisational line-up. Large enterprises such as IBM and Bosch have already integrated PR and marketing, with former PR chiefs being in the lead. I expect this to see more often.
  • More governance: More direct communication – this has been pointed out time and again – results in loss of control. I’d like to distinguish that a bit. If corporate communication is not just a one-way street of press releases, advertisements and brochures, you will certainly lose a part of the control over the content, because suddenly many can chime in, be it employees, customers, partner or other stakeholders. However, such a democratisation of communication doesn’t necessarily lead to anarchy. We will need a communicative constitution allowing for civilised interaction with relevant results for all, a communications governance all employees have to adhere to.  It will probably be coordinated by communications chiefs working with HR, Legal, and IT. With the number of participants communicating demand for communication trainings will increase, too, not only for spokespersons, but for all employees. So the loss of control over content will be counterbalanced by increased control over the framework of communication. We can observe first signs of this development in “social media policies”.
  • More internal communication: Employees have always had an impact on the reputation of a company, but with the advent of social media their influence has grown massively. They are becoming brand ambassadors, good or bad. In addition, companies are under increasing pressure to change as fast as their markets. Employees have to support these transformations, if their company is to stay successful. That’s only possible, if the demand for communication generated by transformations is addressed in an interactive way, otherwise employees will only be affected by the change rather than actively engaged in its success.
  • More internationality: The globalisation of the economy results in a globalisation of communication. Even small companies are joining internationalisation earlier and earlier. However, the different publics you have to deal with are rather getting smaller than larger, since it’s easier to reflect and organise special interests online. With the expansion of total reach comes a fragmentation of the parts. The PR organisation and its chief will face demands that won’t be met with previous habits. Without going into details, I would argue that tomorrow’s communication department needs to be ready for decentralisation, virtualisation and cultural adaptability.
  • More value: I expect requirements for evaluation and controlling of communication to increase even more. That will be good for our discipline, because its value beyond media reach will become visible. Increased cost pressure concurs with some of the other change factors mentioned above. E.g. the impact of communication can be better derived from direct communication than from indirect communication via traditional media. At the same time, everything happening online can be better documented. And the integration of PR, marketing, and customer relations will allow for significant synergy effects.

Is the press release dead? What will be the tools of the future?

No, the press release isn’t dead. To some degree we are even seeing a renaissance of the press release. It’s easier to distribute than ever before, both online and offline. Offline, editorial offices are being more and more centralised, so that local media can’t produce much content anymore. Online, there are more spaces for press releases than ever before, and despite an early social media myth many blogs are happy to accept them. In terms of its format, the press release as we know it, will stay mostly the same in regulated environments such as financial communications. In less regulated environments the press release will get shorter, multimedia-based, and modular, as we can already see with today’s social media releases.

We will also see new communication platforms. I can’t foresee which ones will have survived in five years from now. Let’s just consider: Facebook is around since 2004, YouTube since 2005, Twitter since 2006. I believe we will see new players we don’t know yet, in particular in the mobile space. Real-time communication will certainly play an important role for news creation. But there will also be continued demand for reflexive communication providing backgrounds and context, I actually believe this demand will increase, so as to offer orientation in an ever growing information glut. Regarding particular tools, I expect the use of images and moving images to go up dramatically, since their cost of production and publishing has gone down dramatically.

Traditional PR is built on a story. Will that still be the case in the future?

Yes, the story will always be the driver of organisational communication. I expect, though, that stories will have to be less narcissistic and more audience focused, because the audience doesn’t have to suffer in silence anymore what’s been thrown at it. The recipients are able to express their opinion and they do it. The story development will have to revolve around connecting company stories to topics audiences care about. Theoretically this has always been the case, but the practical necessity to make it happen has increased significantly. In particular in product communications I expect less feature talk and more meaning to users’ life.

PS: If someone needs a good read on the future of PR, I do still recommend the “Authentic Enterprise” report of  the Arthur W. Page Society. It’s three years old, but still worth reading.

Georg Kolb

 

Today’s new publics (navigation series, post #1)

Welcome to my Corporate Communications Compass (CCC)!

This first post is not only to inaugurate CCC but also the first article in a little series on how to navigate today’s marketing milieu. The series is mainly based on a presentation I held at Bulldog Reporter’s Media Relations Summit 2008 in San Francisco. Following the presentation I got a lot of great feedback and requests to share more of my approach and continue the discussion. So, here you go!

Today’s marketing and communications environment can look confusing. While the traditional approach with mainstream media is still dominating the daily routines of most marketers and communicators, a myriad of new online media is emerging: blogs, RSS, wikis, social networks, social bookmarking, sharing and rating sites, virtual worlds, you name it! How can we detect and leverage new opportunities for our business, but also avoid wasting resources on dead ends? How can we navigate through this rapidly evolving space?

I tried a couple of navigation systems to see what they can do for our situation.

The first one is a subway map.

It was created by an organization called the Future Exploration Network and is meant to illustrate how trends blend and impact each other. Each subway line represents a major force of change in our lives: yellow is society, purple is politics, pink is demographics, green is economy and red is the technology line. The points where they cross are major interchanges. While I don’t necessarily agree with all the stops they put on these lines, I think they have a strong point here, which is: today’s marketing environment is more connected than ever. Some people think that it is mostly technology that changes communications or even our lives. I disagree. I believe we need to understand all the forces in this milieu, so as to understand the change and make our work successful. Don’t be afraid, I won’t even try to talk through ALL of this now. But what I will do is to address those forces that make the most difference to us. How does this kind of milieu impact what we as communicators should worry about most? How does it affect the people we want to communicate with?

Let’s start with the societal perspective. We are living more individualized lives that are not as regulated by public institutions as they were by previous generations. As a result, people are building trust in new ways. They have less trust in established institutions like governments or brands. Even personal advisers like doctors or lawyers are less trusted. Instead they build increasingly trust with people who share an interest with them: their peers. In summary, we have more confidence in each other than in institutions. Most of us will be able to confirm this anecdotally, but there are also studies from Forrester Research, Yankelovich Partners or Edelman’s annual trust survey that prove this is happening. Let’s look at an example. While our grandparents would have typically followed the advice of their doctor without asking any questions, we not only call for a second opinion, but we also seek someone else who suffers from that same disease before we undergo that surgery.

Aiding this social dynamic are new technologies that actually empower us to connect with our peers in peer-to-peer (p2p) networks. We can use search engines to locate someone else with that same rare disease who lives on the other side of the planet. The same dynamic is true for all aspects of our lives, as well as the products we use. Any group of people who share an interest in what a company does or stands for can easily connect through the internet and share their views by electronic word of mouth. They can do this on a growing number of new media platforms like blogs, wikis, social networks or even in a virtual world like Second Life. These communities of interest can include customers, employees, media, analysts, partners or members of any other traditional audience, each of them a potential source of trust or distrust between the other.

In economic terms, networks of individualized peers create niche markets. However special someone’s interest might be, the probability that this person will find peers who share this interest was never higher than today. And commmunities of interest create demand. Let’s again look at an example. My 11-year-old son is a penguin enthusiast with a lot of specific questions. You wouldn’t believe how quickly he found online buddies who could help with things like: Where is the best zoo for penguins? Where is a toy store carrying cool plush penguins? What are the best penguin movies? Where can you watch, rent or buy them? Where is the best place to meet these guys in their natural environment? Is there a travel agency that will take you there? And, of course, how do you pitch a penguin budget to your dad? (By the way, there is a virtual world called “Club Penguin” where children play games and interact with penguin avatars. Last year, Club Penguin was acquired by Disney for $ 700 m US-Dollars.) In the grand scheme of things, the penguin “industry” might still be a niche market, but you can see how market fragments can shape up today fueled by social networks of peers.

Based on this triple dynamic in society, technology and economy, I believe it’s fair to say that we have to deal with new publics. What makes them new? Since this space is evolving rapidly, any definition claiming to be exhaustive will fail, but here are a couple of characteristics. Firstly, new publics are constituted by people who couldn’t connect as an interest group before, because they were limited by all sorts of borders: geographical, cultural, hierarchical, etc. Think of the examples with the disease and the penguins above. It also makes them new that they are or can be interactive. Rather than one talking to many, as in traditional media, everyone can talk to everyone else. In other words, traditional publics favor large audiences of listeners whereas the new publics facilitate smaller communities of networkers. And it is new that an interest group can shape up ad hoc in response to an event. For instance, an audience that doesn’t like what they see on stage, can get organized and react badly, as we have seen when Business Week’s Sarah Lacy interviewed Mark Zuckerberg. As I am writing this, I realize, that the definition of new publics warrants further exploration. In the meantime, what do you think of the idea and what other characteristics would you add?

Georg Kolb