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Communication’s Role in the Financial Crisis

by Paul M. Sanchez, ABC, APR

In recent weeks, the breadth and depth of the financial crisis has been etched into the consciousness of those of us who work in business and observe world business affairs. And there is ample evidence that at all levels of enterprise, workers of every classification are feeling apprehensive about the future. And that’s not including the anxiety felt by the over 1.9 million workers in the U.S. alone who have lost their jobs this year.

Underlying the ever-bleaker financial news coming from all types of media outlets is the fact that although communication can be seen as part of the cause, it will certainly be part of the remedy. So what, then, should be the role of communication and the professional communicator in the midst of the crisis? Should communication be viewed as a mere information distribution process, or should it be regarded as a critical function that plays center stage in addressing the daunting challenges of reestablishing trust, building understanding and fostering cooperation?

Should the communication professional be cast as a passive tactician or as a proactive strategist? A gatekeeper of the intranet or the person choosing the best way to reach constituents? As a packager of messages, or the framer of commentary and the adviser to management? The communicator should be, in my opinion, the architect of strategic communication programming. I would like to address the specific challenges facing those charged with workforce communication during these tough economic times.

Wise organizations (and forward-thinking communicators) have long made it a priority to offer financial education programs to employees. In these cases, a basic understanding of the economics driving a particular industry sector or product segment may already exist. This sort of communication effort directly relates to the employees’ jobs and financial well-being. If the organization has given employees a comprehensive understanding of the value chain inherent to the process of meeting market and customer needs, while controlling expenses, then gaining the support of employees in times of economic crisis will be easier to achieve. Nevertheless, with or without this base of financial education, there is still a need to reach out to employees and (1) ask them to identify their specific areas of concern regarding the financial crisis, and (2) develop communications with timely, relevant content that are distributed face-to-face and via more formal media such as the company publication or intranet.

Paramount in a communication program that addresses these financial crisis issues is the visibility of leadership. There is no substitute for seeing and hearing the CEO and other top leaders speak to these issues and their expected impact. There have been too many reports of employees learning about major events involving their organization from the morning news. Communicators must encourage top management to be visible to employees. With the many channels now available to us, there is little reason not to keep employees informed and in touch with their leaders.

Specific communication about a company’s performance is often governed by the rules and regulations of financial communication. Yet communicators should still develop communication programming that encompasses the current national and international economic environment and its relation to their own organization. We know from research in hundreds of organizations that employees are quite sensitive to questions of job security and the probable impact of economic conditions on their organization. Within this broader framework, there is much that can and should be communicated about the general direction management is pursuing and why and how employees are involved.

While this article is focused on workforce communication—and not other facets of communication programming, such as communication to shareholders, customers, communities and the public at large—there is a real need for integrated planning and coordinated programming for all communication efforts. Coordination takes more than just recognizing that it must happen. Commitment and direction from the leadership of the organization is necessary to make integrated communication a reality.

Anyone who is responsible for communication—for developing programming that aims to help the organization reach its mission—must operate with a mandate that communication is an important management process. They must be intent on representing the collective views of the workforce to management. In both good and bad economic times such a professional communicator should be gathering information, formulating and disseminating information, and preparing communications for application across the available communication media for employee consumption.

So just what might the professional communicator be doing at this juncture?

First and foremost, they should:

1. Conduct research to identify issues that concern employees.
2. Gather background information on how the economic crisis is affecting, or could affect, the organization.
3. Prepare a brief plan of action.
4. Draft the core content (key messages).
5. Brief management.
6. Use all appropriate media, including face-to-face communication.
7. Assess responses and re-communicate.

There is no doubt that communicators could simply wait for direction from the top. But that would not be the most professional and forward-looking approach. Communicators have a unique responsibility to think about the best interests of their constituencies. Communicators can reinforce the vision, goals and plans that management defines as priority. Conversely, communicators must bring information from employees to management regarding their interests and concerns. The current financial crisis presents this generation of communicators with an unprecedented challenge.

It will take an extraordinary amount of effort to get the global economy moving again. But there can be no doubt that the talents and industry of communicators will be vital to bring about the sort of shared understanding that is needed in the face of these serious challenges.

Paul Sanchez, ABC, APR, is a worldwide partner at Mercer, specializing in employee research and communication. He is the past chair of IABC’s Research Foundation and past IABC executive board member.