5 steps to help transform communication from a cost centre to a value centre

I was delighted to be asked to contribute an Australian perspective for the Public Sector Digital Engagement World Tour held by Granicus. The tour stopped in Birmingham last week and has dates in the United States and United Kingdom through to December. Search #govtour17 on Twitter to join the conversation and find out more.

In sharing my experience leading communication teams through significant budget cuts, I will talk about what I learned about the need to shift communication (corporate affairs) from a ‘cost centre’ to a ‘value centre’ and five things that can help move the function up the value curve.

The invitation to contribute arose from a Twitter conversation with Darren Caveney of comms2point0 about the experiences of Australian and UK communication teams with budget and headcount cuts following the Global Financial Crisis.

As well as establishing the purpose for this piece, I mention this conversation because it’s a simple, yet compelling example of the connections and collaboration that social media enables for individuals and for business on a global scale.

Leading communication post-Global Financial Crisis, or ‘the GFC’ as it’s called in Australia

It would be easy from other parts of the world to think that because Australia did not experience recession after the GFC, that business here has been spared from the ‘austerity’ experienced in some other markets globally.

In shorthand terms, while Australia has maintained uninterrupted economic growth for the past 26 years, consumer confidence and business growth has been impacted by the global slowdown since the GFC and the subsequent end of the nation’s mining boom – and that’s led to an era of cost cutting and productivity measures across Australian business and government.

My own experience of what this has meant for the communication function started in a global leadership role for a corporate communication function which had staff in triple figures. Delivering both internal communication and media relations, the function underwent total cuts to around 40 per cent of roles and other budget tightening.

This total resulted from multiple rounds of team restructures over several years, as the aftermath of the GFC continued to bite and the business responded with changes of focus and shape.

I’ve since led and advised other communication and corporate affairs teams undertaking restructures and seeking to better define the service and value they bring to both federal and state government agencies.

I truly believe that adversity and uncertainty create moments for growth and my experience as a communication leader post-GFC, while personally and professionally challenging at the time, has undoubtedly made me a better practitioner and leader. That’s probably the standout learning and one worth remembering when navigating a tough period at work.

But in more practical terms, how do you deal with significant budget cuts?

The natural place to start is ‘doing more with less’ and sometimes this shifts to ‘doing less with less’, but ultimately success rests in ‘doing things differently.’

Many large communication teams can probably afford to lose a bit of resourcing without too much pain because there are often low-value activities that can and should be stopped. However in my experience, the only way to manage through more significant cuts is to make fundamental change to the way you do things.

Before looking at ways to achieve that, there are a couple of other factors that have contributed to the challenge for communication professionals.

Other factors impacting the communication function

The economic slowdown and budget cuts post-GFC have coincided with two significant factors that have impacted the communication function:

  1. The communication function’s own journey up the value chain

In the 21st century, communication professionals (particularly internal communication) emerged from the function’s origins as an ‘order taker,’ to seek their place as trusted advisors and communication strategists and have since had the opportunity to move beyond that, to stake their claim as business partners and business strategists.

Some had progressed further up this value chain than others, which put them in a better place to promote the function’s value to their organisation.

If communication wants to be regarded not simply as a ‘cost centre’ but as indispensable to the business, it needs to shift further up this curve and be able to demonstrate its value to the business.

  1. The digital era and digital transformation of organisations and communication

The emergence of social media in the first decade of the century and the digital disruption that has followed has coincided with business restructuring driven by cost and productivity imperatives amid a global slowdown.

Given the communication function’s order-taking origins and propensity to keep adding new activities, the arrival of new digital communication tools has been greeted like an exciting yet overwhelming possibility for some communication teams.

Just as communication team budgets have been cut, they’ve been faced with increased demand from organisations undergoing change along with disruption of their own function. Australian communications professionals who participated in the Asia-Pacific Communication Monitor 2015-16 identified their number one issue through to 2018 as coping with the digital evolution and social media. Note the language: coping.

However, digital is one area of the communication function which received growing investment in recent years, with 75 per cent of marketing communication teams in Asia reporting an increase in digital resourcing in 2015-16 according to The Pulse survey.

So how can the communication function make the shift from cost centre to a value centre?

Put most simply, by delivering tangible and measurable value for the business.

Communication functions must get their relationship on a business footing with their organisations and demonstrate their contribution to business performance if they are to earn greater influence, trust and empowerment.

This requires some work and often a mindset shift, but there are clear benefits to the performance and influence of the function, and to the return on investment for the organisation.

  1. Be a business partner to your organisation

    Communications should operate as a business partner

This starts with deep understanding of the organisation, its challenges and opportunities, so that you are in a position to determine how communication can add most value – from managing reputation, thought leadership and building community, to helping drive business momentum and crisis preparedness.

Communication strategy and activities should align with business objectives and it’s essential that we continue the function’s progress toward better measurement of outcomes to both demonstrate the value that’s been delivered and generate insights for business planning.

If the organisation sees real value being delivered, it is more likely to continue to invest.

  1. Develop a communication strategy

The development of a communication strategy is a powerful tool for operating as a business partner. It’s the basis on which to have a conversation or a negotiation about how communication will support business priorities and how you will measure success. With levels of disruption and transformation likely to continue, that conversation and the adjustment of priorities needs to be an ongoing process through the year.

A communication strategy will ultimately help save you time by setting clear objectives and focusing your efforts on the areas of highest value, as I’ve written about previously: The good news about developing a business communication strategy.

  1. Negotiate a communication service proposition

Supporting the communication strategy above, the development of a service proposition for your team is another opportunity for a business-minded conversation with the CEO and other leaders in your organisation. Working together, you can identify and agree what services your team will deliver.

Deciding what the team doesn’t do, or can no longer do based on resourcing levels, is just as important. However, it’s best not to start the conversation with services you wish to take away or you will immediately have your business partners on the defensive. You are more likely to have a positive, constructive conversation if you start with asking ‘where can communication add the most value?’

Communication professionals tend to fear these conversations without good reason. Identifying priorities and allocating resources is precisely how business people think and operate, and managed appropriately, this conversation should not come as a surprise to a business leader.

  1. Build your organisation’s self service toolkit

    Bracket creep is a perennial issue for the communication function because there’s almost no limit to what can be classified as communication within an organisation and it’s not uncommon for people to outsource part of their job as a people manager to the communication function. Shifting the communication team from everybody’s ‘comms doer’ to being a true ‘comms advisor and partner’ requires a shift from these transactional activities to more strategic corporate communication delivery.

    This in turn requires building organisational capacity to self-manage everyday communication activities so that the communication function can focus on strategic delivery. Start by analysing the kind of requests the team gets regularly and build some ‘do it yourself’ tools and tips to help managers, coupled with some manager communication training if needed.

  2. Recognise digital as an opportunity to do things differently

Communication cannot operate strategically if we just keeps adding new activities. Every time we seek to add something, we must ask ourselves business questions such as: why should we do this, what does this mean for what we’re already doing, how are we going to resource it, are there things we need to stop doing, are there things we need to do differently?

This is particularly the case in the digital era. Digital transformation of business and government has only increased the importance of the communications function in areas such as facilitating the work of the organisation in new ways, engaging and listening to stakeholders and building community, and managing reputation.

We have access to powerful new tools for internal communication such as employee social networking and external communication via owned digital channels and social media.

However, regarding digital and social tools simply as new channels to be added and fed, means missing the real opportunity.

Digitalization provides the opportunity to transform the way our organisations do business, the way our people do their jobs and collaborate, and the way we engage with our clients and stakeholders – and communication professionals should approach it with that mindset.

Investing time to make the shift

While the opportunity for communication teams to contribute value for organisations is significant, communication teams have been regarded as ‘cost centres’ in that they cost the organisation money and do not directly generate revenue.

Having said that, some communication (corporate affairs) teams may have income targets to meet through sponsorships, partnerships, grants, donations, membership schemes and other promotional opportunities.

Regardless of whether or not you have an income target, it’s worth investing the time to ensure your communication function is operating to its full potential and can be recognised as a value centre for your organisation.

Communication should drive value for the organisation

 

What’s happened to your communication budget and headcount in recent years and how has your team responded to the challenge?
Please share your thoughts
and ideas in the comments below.

Published by

Mairi

Mairi Barton is a Melbourne-based strategic communication and public affairs leader who has influenced and delivered outcomes at the highest levels of the Australian corporate, government and non-profit sectors. She is an award-winning former journalist who worked in the Federal Parliamentary Press Gallery in Canberra. Mairi currently operates her own strategic communication consulting firm: Pinch Yourself Communication. A writer and blogger, Mairi is currently writing a memoir about her father's life and she blogs from time to time about creative life via her personal blog: pinchmyself.org She also enjoys photography and posts pictures most days to her Instagram gallery: @pinchmyself