Clarity Comes Down to Communications(1)
IPR study shows how CCOs can contribute to bottom-line organizational performance

Did you know there’s a direct connection between organizational clarity and organizational performance?

A recently released Institute for Public Relations report, “Organizational Clarity, The Case for Workforce Alignment & Belief,” argues that such clarity is critical to employee performance, satisfaction, overall organization morale as well as top and bottom-line performance.

The two-year study was organized by the Institute for Public Relations Commission on Organizational Communications, who interviewed 1,527 employees representing five countries across six industry sectors.

Their initial goal was to uncover any links between a person’s job, the market in which her company competed and the organization’s strategic vision for success. Were links properly aligned and, if so, did they effect organizational success by fully engaging employee and manager alike?

Author Gary Grates managed a group of IPR commission members to better understand:

  • How, and to what degree, does an employee look inside his company to understand its strategy and how it is applicable to his job.
  • To what degree does an employee also look outside the organization to learn if her role, and the organization’s role in the larger marketplace, are properly aligned.

Grates and his team explored whether a significant percentage of employees looked solely OUTSIDE their organization to understand their future employment prospects. In other words, did they count more on industry sources to plot their careers, look to senior management for mentorship and guidance, or both?

Creating a first-of-its-kind model

The group then pieced together a Clockwise Organizational model which assures organizational clarity (and performance) will increase because employees will better understand the marketplace as seen through the lens of the company’s strategy. This model is expected to outperform its sector.

By contrast, organizational clarity is decreased when employees fail to grasp their marketplace strategy AND are clueless as to how their company’s strategy fits within those parameters. The market dimension is the only one that can diminish organizational clarity and lead to a counter-clockwise organization expected to underperform its sector.

The bottom line? Organizational leaders either clarify a cloudy organizational communications program or suffer the consequences.

The research results

Grates then used his research to create methodology organizations can follow to achieve that critical organizational clarity. He and the Commission chose five countries to examine (Note: Countries were selected in both mature and immature markets): the US, the UK, India, Brazil and China. They next chose six sectors: automotive/ transportation, energy, financial services, food & beverage, healthcare and technology.

The authors measured their three, key criteria by country and sector, and asked leaders across the board to evaluate two key questions:

  • Does your organization have organizational clarity?
  • What specifically can you do to improve organizational clarity?

So, which countries and which sectors fared best?

Countries

Overall, the best to worst countries in terms of organizational clarity were India, the U.S., China, Brazil and the U.K.

You can review the study for the reasons why each country finished in the order they did, but suffice it to say that India won the Triple Crown, finishing first in all three clarity categories (with two B+ grades and one F).

The U.S. finished a distant second because, although employees appeared to understand their organization’s purpose and mission, they thought there were simply too many initiatives going on at once, and reported results for each weren’t shared nearly frequently enough. Oh, and, by the by, the Brits finished dead last.

Sectors

The technology sector topped the list scoring two solid B+ grades but an F in marketplace understanding. Four other sectors finished in a dead heat with average scores of two C+ and one F. Healthcare brought up the rear. All sectors flunked the marketplace understanding category (which came as a complete surprise to the research team).

So, what’s the answer?

The organizations and sectors with the best organizational clarity all took what I would call an outside-in approach to explaining the connection linking the overarching marketplace, the organization’s unique role and strategy within the market and detailing the meaning and purpose of the employee’s role in achieving her individual success as well as the organization’s.

So, rather than preaching at their employees, the best organization’s took pains to ensure managers understood marketplace realities, competitive issues, etc. They next created a comprehensive narrative describing their strategy in story form. They communicated the information in a provocative tone and established an employee worldview. They raised the volume on key inputs of the strategy — customers, competition, products, delivery and societal concerns. And, last but not least, they synchronized leadership’s messaging across all divisions and business units.

The strategic roadmap

The research report concluded with a list of 10 takeaways and suggested actions to improve organizational clarity and drive performance.

Grates and the commission are to be congratulated for their seminal research. It not only takes a unique view on how the communications function can impact the top and bottom-line success of an organization, but also provides a roadmap for pioneering CCOs and top PR firms to provide a far greater strategy value to the C-Suite.

Steve Cody is Peppercomm’s Co-Founder and CEO. He is also a Trustee for the Institute for PR. Follow him on Twitter @RepManCody.

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Heidy Modarelli handles Growth & Marketing for IPR. She has previously written for Entrepreneur, TechCrunch, The Next Web, and VentureBeat.
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