Communication in an Organization

Introduction: Organizational Communication, in today’s organizations has not only become far more complex and varied but has become an important factor for overall organizational functioning and success. The way the organization communicates with its employees is reflected in morale, motivation and performance of the employees. 

Definition: Communication, derived from the Latin word “Communicare” which means, to share; is the process of transmitting information and understanding. Communication is the activity of conveying information through the exchange of thoughts, messages, or information, as by speech, visuals, signals, writing, or behavior. It is the meaningful exchange of information between two or a group of persons.

Role of communication in an organization:

Communication is organization has the following role:

• Helps in fostering motivation
• Aids in the function of control
• Provides information for making decisions
• Gives vent to one’s feeling
• Helps in the satisfaction of social needs

Types of communication:

Verbal communication:

Verbal communication contributes to 45% of our communication. It involves the use of language and meaning (oral or written). Verbal communication becomes effective through the choice of right words & emphasis of the same. There should be an optimum use of pauses, non-words and phrases because excessive use of these leads to distraction of the receiver.

Non-verbal communication:

Non verbal communication is the conscious and unconscious body movements in communication. Non verbal communications are those which are not expressed orally or in writing and include human elements associated with communication. These form an important and inevitable aspect of the total communication process because it compliments and substitutes verbal communication.

A good communicator should have the right posture, facial expression and body language that are in tune with the words spoken. Lack of co-ordination between verbal and nonverbal contents of communication would only confuse the receiver. So while communicating, care should be taken to ensure a proper blend between words and actions.

Forms of Communication:

Communication in organizations can be broadly classified into formal and informal communication.

Formal communication takes place through the system in organization. Formal communication is effected in upward (subordinate to superior), downward (superior to subordinate) and horizontal (between same levels) directions.

Informal communication (grapevine) in an organization is very active and powerful. Nature of communication through this medium is oral and the speed with which the message is spread through this network is tremendous. As a result, distortion at any stage cannot be identified. This is probably the reason why grapevine is said to be the medium for spreading of rumors or false message.

Internal and External Communication:

An organization has to communicate both internally and externally. As we learnt that communication is vital in every organization for fostering good culture. A brand of the organization can be built with through effective communication.

Internal Communication, in a business context, is the dialogic process between employees and employer, and employees and employees. A variety of channels can be used for internal communication like One-on-one meetings, team meetings, town halls, corporate news letter, quarterly/annual reports, and road shows

External Communication is the exchange of information and messages between an organization and other organizations, groups, or individuals outside its formal structure. The goals of external communication are to facilitate cooperation with groups such as suppliers, investors, and shareholders, and to present a favorable image of an organization and its products or services to potential and actual customers and to society at large. A variety of channels may be used for external communication face-to-face meetings, print or broadcast media, and electronic communication technologies such as the Internet. External communication includes the fields of PR, media relations, advertising, and marketing management.

Tips for making communication effective:

• Use concrete than abstract words wherever possible.
• The content has to be made meaningful to the receiver
• The message should be framed according to the capability of the receiver.
• There should be a proper blend of verbal and non-verbal communication
• Eye contact should be maintained
• Speak at a moderate rate
• Create rapport with the receiver
• Select appropriate channel
• Encourage listening & feedback
• Avoid communicating in extreme emotional states
• Make the message – Attractive, brief & clear

Employee Referral Program - A Tool to reduce recruitment cost

Introduction: Employee referral program is one of best tool in attracting the talent in both short span of time and also reduction in costs. Employee referral programs are considered as one of the most reliable recruiting sources. 

An employee referral program can be effective by:

1. Design the job description: A well designed jobs always gives a clear message to employees on the requisites of the position such as qualifications, skills, experience and expertise.
2. Design the employee referral program: Design the employee referral program which includes the eligibility and participation of employees, process, Service Level agreement (SLA), e-mail address for sending referral resumes, Cash awards and rewards for various positions and levels, timelines for credit of cash awards.
3. Publish the program: Once the employee referral program is finalized, publish it through various modes like often send e-mails to employees, postures and newsletters.
4. Dedicated Human Resource professional: Employee referral programme effectiveness depends on the scheme responsiveness or feedback given for referrals and this can happen only with appointment of a dedicated human resource professional.  Tracking, coordinating interview, provide feedback to all applicants and employees referred, provide metrics related to employee referral program would be key responsibilities on this human resource professional. 
5. Employer Branding: Arrange a company brochure which gives details of products, services, geographic locations, customers, markets, financials and benefits provided by the company. Arrange a video of employees sharing their experience and happiness for working for the company.
6. Monitor the program and continually improve:  The employee referral program has to be monitored regularly by various metrics and also formal and informal feedback received from employees. Adopt process enhancement at the earliest for the program to be effective.

An employee referral program can be attractive by:

• A catchy program name, punch tagline.
• Allow employees to post the job positions in their social media.
• Organize referral events or interviews only for referrals on a specified day.
• Reward first time referral and reward each referral who gets to the interview.
• Provide non cash awards for highest number of referrals.
• Double the cash award for niche and hot jobs.
• Adjust the cash awards based on the salary of the position.
• Organize periodic award ceremonies and public display of each successful referral.
• A thanking e-mail or a handwritten note or a call from a senior executive to an employee for his/her contribution in bringing the talent for high level or hot or niche positions.
• Arrange a video with successful employee referrals on their experience in the organization at various stages - interview, post interview, interviewers, offer stage, joining and post joining.
• Publish the highest number of referrals, success stories of referrals in newsletter.

Employee Rewards & Recognition – A tool for improving employee motivation

Introduction: In a competitive business climate, retaining employees have been a challenge. Employee reward and recognition programs are one method of motivating employees to change key behaviors to benefit a business.

What is Employee Rewards & Recognition?

Rewards: Employee reward system refers to programs set up by an organization to reward performance and motivate employees on individual and/or team levels. They are normally considered separate from salary but may be monetary in nature.

Recognition: Employee recognition programs are often combined with reward programs. These may or may not be monetary in nature. Employee recognition is a communication tool that reinforces and rewards the most important outcomes people create in an organization.

Why Rewards & Recognition?  
An employee rewards & recognition programs results in

• Improved performance
• Motivation
• Employees feel that they are valued for their performance
• Improves teamwork
• Employees feel more responsible
• Builds positive morale in the work environment
• Reinforcing organizational values and cultures

Types of Employee Rewards & Recognition Programs:

Reward Programs: These are monetary in nature. There are number of types of reward program aimed both at individual and team performance.

• Variable Pay: Variable pay can be tied to individual employee performance, organization’s performance, performance of business units or combination of all these.
• Incentives: Incentives usually reward individual accomplishment and are frequently used in sales organizations to encourage sales persons to generate additional business generation.
• Profit Sharing: Profit sharing is usually given to reward employees for their contribution to an organization’s achieved profit goal.
• Stocks: Allotment of stocks has become an increasingly popular method in both established organizations as well with start-up organizations. Employees tend to stay a longer period with these kinds of rewards. There are number of choices like stock options, additional stock purchase programs, and restricted stock units.

Recognition programs: Recognition may or may not be linked with monetary benefits. Recognition can take a variety of forms:

• Formal recognition programs can include regular recognition events such as lunch or dinner, star performer recognition, organization’s news letter featuring the accomplishments of employees or department recognition, outstanding team recognition and providing additional vacation time or sponsoring a vacation plan.
• Informal recognition can take the form of privileges such as working from home or starting late/leaving early.

Tips for effective employee Rewards & Recognition program

• All employees must be eligible for the recognition.
• Identification of company or team goals that the reward program will support.
• Identification of the desired employee performance or behaviors that will reinforce the company's goals.
• Determination of key measurements of the performance or behavior, based on the individual or team's achievements.
• Determination of appropriate rewards.
• There has to be a transparent process in identifying the eligible employees for rewards and recognition. Managers and senior management should be included in this process to avoid favoritism.
• Program has to be communicated appropriately and has to be widely spread out in various occasions.
• The rewards & recognition to be done or to be given by the senior management team in town halls or on certain special occasions in the organizations.

Compensation Structure as a tool to attract and retain talent

Introduction: In the current context of competitive environment, it makes difficult to acquire and retain the top talent. The compensation strategy is the extremely important part of overall HR Strategy to keep the organization competitive and successful. Building a fair and competitive, attractive compensation package is critical for attracting and retaining top talent. Compensation structure is influenced by organization’s industry. 

A Good compensation structure does not provoke employees to search for a job. It makes them to focus on delivering the results. It also encourages employees to talk about the organization and their success with their friends. 

Definition of Compensation:

Compensation is the total amount of the monetary and non-monetary pay provided to an employee by an employer in return for work performed as required.

Compensation is based on:

• market research about the worth of similar jobs in the marketplace,
• employee contributions and accomplishments,
• the availability of employees with like skills in the marketplace,
• the desire of the employer to attract and retain a particular employee for the value they are perceived to add to the employment relationship, and
• the profitability of the company or the funds available in a non-profit or public sector setting, and thus, the ability of an employer to pay market-rate compensation.

What does a Compensation structure include?

Compensation is not just in terms of monetary. Compensation also includes payments such as bonuses, profit sharing, overtime pay, recognition rewards and checks, and sales commission. Compensation can also include non-monetary perks such as a company-paid car, stock options in certain instances, company-paid housing, and other non-monetary, but taxable, income items.

It can be categorized as below:

• Base Salary: This is single largest point in the entire compensation structure and often this would be most compared point for employees and prospective employees. This can also be called as gross salary or fixed salary.

• Variable salary: A variable salary is linked with performance of an employee and organization. Sometimes, this can also be called as performance incentives or performance bonus. While the performance of an employee and organization is mostly observed in service oriented or product development companies, the incentive based salary is observed in marketing, sales, business development and in out-bound call centers.

• Reimbursements: These include components like medical expenses, internet expenses, child education expenses, telephone expenses, periodicals or magazine expenses and etc. This can vary in each organization and can vary based on the local laws prevailing in countries.

• Perks: These include laundry services, day care facilities, health check-up’s, eye check-up’s, dental check-up’s, health club memberships or gym memberships, sponsorship for higher education.

• Retirement plans: These differ in each country. In India, the retirement plans include provident fund, superannuation, and gratuity.

• Stocks: This is mostly used as a long term incentive and can include like stock options, stock purchase plans and restricted stock units.

• Welfare (Insurance): These can include right from Employee Statutory Insurance (in India) to medical insurance, personal accident insurance, term life insurance.

• Others: It can include leave and leave encashment, rewards, providing occasional gifts on birthday, wedding anniversary, new born baby, vacation plan allowances, rewards, sponsoring a vacation and etc.

The compensation structure may vary from organization to organization. There is no rule to include all the above in the compensation structure or there can be some more components to be included. Compensation structures vary based on the organization’s industry. It also varies in different countries.  Companies do engage compensation professionals or agencies to get the competitive compensation package for job levels in their organizations. 

Disclaimer: The contents of this article cannot be treated or interpreted as a statement of law. In case, any loss or damage is caused to any person due to his/her treating or interpreting the contents of this article or any part thereof as correct, complete and up-to-date statement of law out of ignorance or otherwise, the author will not be liable in any manner whatsoever for such loss or damage.