The future of a company lies in the hearts and minds of the employees because, in the end, they are always the ones who actually get things moving, inspire the customers, and shape our progress. Nowadays, where continual transformation has become the norm, employee direction, inspiration and motivation have become all the more important. The potential of a company is boundless, if it is successful in taking the employees along the path to the future, if they pursue a clear common goal, and if they become standard bearers for the ambitions of the company.
Employees are not aware of company strategy —
In practice, however, this is often the sticking point. Only a very few companies manage to convey their strategy successfully to the employees. A study by Kaplan & Norton, published in the Harvard Business Review in 2005, documented that, on average, 95% of employees do not know or understand their company’s strategy at all. If your employees neither know nor understand your strategy, how do you expect them to act in line with your corporate aims? There is a great risk that your company will not move an inch and your visionary strategies will remain toothless paper tigers. Innumerable studies have been carried out on the subject of «Strategy Implementation». And they all show that between 60-80% of corporate strategies fail in their implementation. 60-80%! That is an alarming statistic. And in many cases the implementation is doomed from the start, because of failure to communicate the strategy to the employees, and because the culture of the company was not included in the picture. «Culture eats strategy for breakfast» - as Peter Drucker said many years ago.
The example of DaimlerChrysler
There is, for example, the well-known case of DaimlerChrysler. The merger was sold to the outside world as a «Merger of equals», while in reality the two companies could not have been more different. On the one hand there was the German Daimler culture: strongly hierarchic, very conservative, efficient, and safety-conscious. And on the other hand Chrysler, a company run on egalitarian principles with flat hierarchies, bold and fearless, encouraging creativity and always trying out something new. In short: the serious Germans came up against the American daredevils. And that simply did not work. The two cultures were simply not explored in sufficient depth, and the new company failed to shape a common vision and develop a uniform identity.
The example of Volkswagen
And then there is the example of Volkswagen, which shows that strategy implementation cannot be forced by exerting pressure. In 2012, the ex-Volkswagen boss Martin Winterkorn announced his intention of reducing the CO2 emissions of his fleet by 30% by the end of that year. This lofty aim was technically impossible to achieve in so short a time. As a result, the VW engineers began using unauthorized measures to manipulate the required values. But how could things have reached the stage where engineers begin to cheat? According to inside sources, a culture of fear pervaded the company under Winterkorn. If a project could not realistically be completed in the specified time, practically no-one dared to ask for more time because target deadlines were controlled with a rod of iron. A culture of cheating crept in and spread like a virus throughout the organization.
Both examples show that successful future planning often fails because of the methods of communication used: if allowances are not made for the corporate culture, and if the gap between the corporate strategy and the employees cannot be bridged. The strategic implementation problem is thus largely a strategy communication problem! How should it be tackled and how can we best solve this problem?
The brand as internal communication tool —
The most effective communication tool of a company is its brand. A brand provides orientation and helps people to make decisions. Of course this applies in the market, in relation to the customers. But it is equally relevant within the company, in relation to your own employees. If they know precisely what their company represents, it will be much easier, clearer and better for them to make appropriate decisions – in terms of the corporate strategy, for example.
In the context of strategy communication, therefore, the brand does an effective job in expressing the future picture and making it clear to the employees today. The brand shows where the journey is going and what is needed along the way. Moreover it helps by appealing to people on many levels, not only with rational facts, but particularly with emotions. The brand manages to trigger something in people. The current generation of employees in particular - the emotionally oriented Generation Y - who for some years have been storming the companies and would prefer to have taken the boss’s chair yesterday already, can be inspired effectively and reached emotionally by means of the brand.The brand works especially well in three ways as an instrument of strategy communication:
1. As a compass, by giving people a clear vision and showing the direction.
2. As an accelerator, by inspiring and motivating the employees for the chosen path.
3. As a steering wheel, by specifically helping the employees to make decisions more easily and clearly in the proper direction.
Many companies use the power of the brand to communicate their strategies successfully to their employees. Here are two examples:
The example of Google
The co-founder of Google, Larry Page, calls on his employees to believe in crazy ideas and is open to «everything that could really change the world». This inspirational idea stands above the incredibly ambitious growth strategy, guides the employees and enables Google to constantly expand into new fields. Starting with a search engine, the company developed additional internet-based services with Chrome, Google Maps and Picasa, brought hardware such as Smartphones or Chromebooks on to the market, or worked on self-drive cars and digital spectacles like Google Glass: all of them things that have fundamentally changed the world or at least have the potential to do so. This approach takes into account that mistakes may be made and projects binned, such as Google Glass, because something was learnt from it. Google is currently working on a lens that can be worn directly on the eye instead of glasses. You see: Google is in a constant state of transformation. The only constant is the brand which gives these transformations a clear direction and is a guide for the employees.
The example of Swisscom
But it is not only «New Economy» companies that use their brand to communicate strategy to the employees. A good example from the «Old Economy» is Swisscom. As a company with a tradition of almost 100 years and a past life as a state-owned enterprise, Swisscom has managed in the last 10 years to evolve from a rather sluggish monopolist to an agile, dynamic and future-oriented business. The re-branding in 2008 played an incredibly important role in this process. Internally it helped to show the employees in which direction the company wanted to develop, and externally it resulted in the public perception of Swisscom as a modern, innovative organization. From our own experience we know how significant the brand is to people and how important the storytelling about the brand is within the company.
Success factors of brand-oriented strategy communication —
If you wish to mobilize your brand as a strategy communication tool, practice has shown that the following points are worth considering:
Success factor 1: Communicate the reason behind the strategy
We start with «Why»! Communicate the rationale behind all the changes and measures. Show a clear vision of what the company wants to achieve in the world. Sum the vision up in the form of an inspiring idea, preferably in such a way that it can easily be remembered and passed on. Roche is a nice example of this. With «doing now what patients need next», Roche managed to give emphatic expression to the sense behind the strategic direction of the company.
Success factor 2: Use emotional storytelling
Shape your vision in an emotional way. Use any and all communication methods, from attractive vision-branding and catchy key visuals for the core content of your strategy, to professional and targeted storytelling.
Success factor 3: Proceed intelligently and gradually
Proceed gradually and top-down with your communication. First enlist top management as the prime sales force of the strategic development of the organization. They should collectively back the new direction and demonstrate their support to the rest of the staff. Then involve the informal opinion leaders. These are to be found at all levels and in all departments. If their acceptance and understanding of the new strategy is obtained, they will become an important driver for communicating it to the other employees. It is only then, in a third step, that you should open up and address the whole organization in grand style.
Success factor 4: Systematically strengthen middle management
Strengthen middle management. It is the key link between top management and the employees. Its members have direct access to both groups; they notice what is happening on the front line and know what the strategy requires at any one time. In order to fulfil this linking function effectively, however, they need practical support, perhaps in the form of communication and behavioural training courses, multimedia communication tools, rather than dull PowerPoint presentations, and convincing success stories from individual departments of the company.
Success factor 5: Showcase the start impressively
Showcase the kick-off with an impressive event. Each and every strategy communication needs a jump start – a strong boost, to underline the fact that it heralds a new era in the company’s development. An event that generates a new spirit of optimism about the future and that will live on for years as memorable images in the minds of the employees. Such an event can certainly be noisy and should be very different from anything that has gone before.
Success factor 6: Involve the employees personally
Ensure that the employees are intensely involved and encourage their debate of the content and consequences of the new strategy. Avoid mere lecture-style presentations and apply interactive communication techniques that are fun to use and which encourage exchanges amongst the employees. There are never-ending possibilities in this area, from games, discussion and workshop formats to electronic live voting.
Success factor 7: Persevere
Take the subject of strategy communication seriously and persevere with it. Communicating a substantially new strategy does not succeed overnight and cannot be settled with a one-off action. The energy generated soon fizzles out and is eclipsed by everyday issues and problems. Understand strategy communication as an ongoing process. People are creatures of habit and take time to absorb new points of view. Internal communication platforms should be used consistently as a follow-up to ensure the upbeat mood continues. The new strategy must always be evident to the employees and this requires a long-range internal communication concept. Most often this necessitates new tools. Digital media in particular offer huge potential which most companies do not yet use appropriately.
If you observe these 7 points, you will significantly increase the chances of successful strategy communication. Then you will connect with your employees effectively and prepare the way for a dynamic future for your company. With your employees on board, what can you not achieve? We are firmly convinced: the potential of your company is boundless!