On how businesses can communicate effectively with their stakeholders (1)

According to The Scientology Handbook by L. Ron Hubbard, “Communication is not just a way of getting along in life; it is the heart of life. Communication is life itself. Without it, we are dead to all. To the degree that we can communicate, we are alive”. Communication is the imparting or exchanging of information by speaking, writing or using some other medium like sign-language or body language. It is a process that involves sending and receiving messages through the verbal and non-verbal means. Communication is a way of sending information in the form of thoughts, opinions, ideas, reports, understanding, knowledge and views between two or more individuals with the purpose of building an understanding, buy-in or engineering a thought-process. There is always a barrier to communication which tries to distort or block dissemination of information or correct understanding (decipher) of messages passed across.

Businesses have different stakeholders that they need to communicate different information at different times or same time and same information at same time or different times to. Doing this is strategic to successful businesses as communication method is the power that has helped propel a lot of successful organisations. Businesses’ stakeholders include the shareholders, employees, distributors or representatives, government, immediate neighbours of the business, and consumers of products or services. The culture, education level, background and level at work of the receivers of information must be considered before method or means of communication is chosen. Mostly, communication in business is top-down, emanating from the managers and cascading down to the junior staff. Some are lateral among peers, and at times, it can be bottom-up, where junior staff members are the one communicating to the managers.

Stakeholder communication is an important skill for every business owner, manager and organisational leader, whether they realise it or not. Communicating effectively with business stakeholders can make all the difference when it comes to building strategic relationships, increasing business influence in the business environment, making strategic decisions, and managing risks. On the other hand, if you find yourself dealing with low sales, greater risks, missed opportunities, reputational damage, and even legal issues, bad or poor stakeholder communication may be the cause. Stakeholder communication refers to the methods organisations use to share information and engagement opportunities with stakeholders – the people and groups that are impacted by business, have an influence on, or an interest in your project or organisation. It can also refer to the methods stakeholders use to reach an organisation with opinions, ideas, queries, concerns, and feedback.

Regular methods of stakeholder communication include:

• Telephone calls: This is the most common means of communication with stakeholders in business.
• Emails.
• Letters, letter-heads, business cards, souvenirs.
• Prints – Newsletter, newspaper and magazine.
• Electronics – Electronic board, radio and television.
• SMS messages.
• Reports.
• Signage – Billboard and vehicle-base.
• Opinion surveys – Questionnaires and direct interviews for market research.
• Face-to-face or zoom meetings or events like Annual General Meetings.
• Online chat messaging and website.
• Social media content like Facebook, Tik-Tok and Twitter.
• Blog/news content.
• Awards and rewards for job well-done and reprisals and penalties for offences and mistakes.

Communication is an important part of business stakeholders’ engagement and management, as it enables organisations and stakeholders to share information for mutual benefits, manage expectations, and build a shared understanding. Businesses need to communicate with all their stakeholders to build trust, loyalty and bridge logistic deficiencies, some of the time. It is worth putting more resources towards improving business communication, improving business targeting, or reaching a larger stakeholder group. The benefits of communicating with stakeholders are many.

Building trust

Firstly, stakeholder communication has a key role to play in building trust between an organisation and its stakeholders. And trust is key to building strong stakeholders’ relationships – the kind of relationships that can deliver a lot of value to both parties. Regular updates means transparency and can demonstrate that a business has nothing to hide, and gives stakeholders visibility into the project, plans, and performance can be jointly assumed. At the same time, showing up consistently with email updates, letters, greeting cards and other forms of communication can help stakeholders trust the organisation to deliver on their promises and respond to any questions and concerns.

Collective decision-making

Regular stakeholder communication can also support better decision-making – for both the organisation and its stakeholders as two heads are better than one. When you keep stakeholders informed and give them opportunities for two-way communication, their comments can have a genuine impact on your business (especially when you engage them early on in the start-up and along its course). On the other hand, if business leaders only communicate with a small, select group of stakeholders, they risk missing important perspectives on the business, potential roadblocks that they need to overcome, and impacts on the business timeline. For example, a market survey to see if a restaurant will be patronised by local residents of an area. Communication like market surveys should be regular as customers change as people move from one area to another or as their status changes. Communication can also help in determining which products a business should produce or services to render.

Ensuring accountability

Regular communication between an organisation and its stakeholders can also help to improve accountability. This can be beneficial in both ways – greater transparency and openness can help keep an organisation accountable to its mission and vision statements, and can also keep stakeholders accountable to fulfil their part of the responsibilities. For example, shareholders who are properly informed about the activities and predicaments of a business may decide to increase their shareholdings in the business. Business managers communicate regularly with key stakeholders via physical visitation, meetings, phone calls, or text messages so that they can share business progress, remind people about upcoming meetings, introduce new product development and keep the business alive.

                                                                                                      Continues next week.

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