Peter Hofmann

Business Metrics For

Internal Communications

Housekeeping

• Slides will be available on our SlideShare page; the link will be emailed to you

• The Recording of the webinar will be available to download; the link will be emailed to you

• Please take time to complete a post-webinar survey that will pop up at the end

• You can type your questions throughout the session

• Time will be allocated in the end for the speaker to address your questions

Presenter

• Peter Hofmann is an Executive Director of MFX Options and Solutions

(Pty) Ltd, specialising in business management and corporate strategic

and operational management consulting. The platform for his current

business focus was established through his exposure to the holistic

corporate business environment where he built a successful career

over two decades, having established and built up successful

departments focused on operational and executive management and

board liaison.

• His integral involvement with projects undertaken have been for a

range of international clients including strategic business plans,

functional plans and processes, supply chain management, strategic

planning and ERP process analysis for implementation of ERP systems

The role of IC employees

Source: The definitive analysis of current internal communication practice published by the Work Foundation and Communicators in Business

IC and the business strategy

Characteristics associated with strategy:

• Concerned with the scope of activities

• Matching activities to the operating environment

• Matching activities to resource capabilities

• Major resource implications

• Likely to affect operational decisions

• Affected by values and expectations of stakeholders that

have power

• Affect long-term organisational direction

Changing environment

• Practice of IC changing

• Ways of communicating “in flux”

• Corporate communications moving to organisational

conversation

• IC boosts employee engagement and improves strategic

alignment

• 4 steps to improving organisational conversation:

– Close the gap

– Promote two-way dialogue

– Engage employees in “telling the story”

– Pursue a clear agenda

Source: Harvard Business Review – May 2012

Assessing IC effectiveness

Source: The definitive analysis of current internal communication practice published by the Work Foundation and Communicators in Business

Measuring value

• Why do we measure?

• Financial metrics

• Non-financial metrics

• ESE / ESG / CSR – trends

• External drivers

• Stakeholders

• Internal customers:

– Sponsoring customer

– Contracting customer

– Consuming customer

– Influencing customer

Information

flows from

the top

down and

from the

bottom up

without

horizontal

flow First level supervisors

Board of

Directors

Senior

Management

Middle level Management

Junior management / administrators

General Workers

CEO

Communication structure

Purchased

Supplies

and

Inbound

Logistics

Primary

Activities

and

Costs

Operations

Distribution

and

Outbound

Logistics

Sales and

Marketing Service Profit

Margin

Product R & D, Technology, and Systems Development

HR, IT, Financial Management, IC

Support

Activities

and

Costs

Service departments are expected to achieve the goals identified so the

internal customers in turn can achieve their overall goals in line with the

organisational vision and strategy

Correct delivery i.e. quantity of work within a timeframe; and

specified quality within a budget constraint

Creating value

Example – Value chain

Focus on client orders, purchases to manufacture specific products and quality and customer service

Marketing Primary

Activities and

Costs

Purchased

Supplies and

Inbound

Logistics

Operations Quality Distri-

bution Profit

Margin

Support functions ……...... SHE ……..…. IC …… Support

Activities and

Costs

Service

Steel manufacturer – niche products to client order

Focus on cost efficiencies (influences competitive positioning), operational efficiencies and “pushing” products into the markets

Primary

Activities and

Costs

Purchased

Supplies and

Inbound

Logistics

Operations Sales

Distri-

bution and

outbound

logistics

Profit

Margin

Support functions ……...... SHEQ ……..…. IC …… Support

Activities and

Costs

Service

Steel manufacturer – standard products on a market-push basis

Example – Value chain

Focus on quality of service and global branding, cost efficiencies (vs. global competitors) and global alliances

Emirates (operate in a global market)

Focus on cost efficiencies on a regional basis (influences competitive positioning), operational efficiencies and “pushing” sales in the low-cost market

Primary

Activities and

Costs

Purchased

Supplies and

Inbound

Logistics

Operations

(incl. maint)

Sales and

Marketing

Safety and

Quality Profit

Margin

Support functions Support

Activities and

Costs

Service

Fly Dubai (focus on low-cost in a regional market)

Marketing

and Sales

Primary

Activities and

Costs

Purchased

Supplies and

Inbound

Logistics

Operations

(incl. maint)

Safety and

Quality Profit

Margin

Support functions Support

Activities and

Costs

Service Corp PR

Building a strategic link

Strategy

Strategic plans

Systems, processes

IC framework

What is in

place to

achieve the

plans?

What

management and

monitoring /

measurement

structures are in

place?

Where do we

want to go?

How do we

plan to get

there?

Summary

• Consider the big picture first

• Customers and stakeholders

• Key messages

• Alignment of IC strategy

• Create a common language and understanding around IC

• Beware of building an overhead mentality

• Define integrated measurables – financial and non-financial

Any Questions?