Friday, February 20, 2009

Financial crisis exposes communications breakdowns

“The force and speed of the global downturn have sent most companies reeling, and many senior managers have not yet figured out how to respond,” according Booz & Company research among 800 global managers conducted in December, 2008.

While that may not be surprising, a “significant lack of confidence in senior leadership’s strategies” is disturbing, and suggests the need for greater C-suite outreach among key stakeholders, namely employees, customers and investors. The numbers:

  • 34% of respondents are “skeptical of plans being put forth by senior executives.”
  • 51% of managers not reporting to the C-level manager expressed similar doubts.

The Booze&Co. report concludes that these numbers may result form:
  • “Executives inability to communicate the elements of their plans,” or
  • “The plans simply don’t resonate with many of the people who must make them happen.”

The study suggests the existence of a significant gap between logical actions and actual actions of senior executives, which is creating a world view that “isn’t always realistic.” Booz researches suggest three steps to remedy this problem.
  • First, executives should get “an accurate read” on their business environment and their company’s relationship to it.
  • Second, they then must pick an appropriate response to the situation, thus “there are many different ways to strengthen the balance sheet….”
  • Finally, essential to regaining wary stakeholders’ confidence is effective communications and decisive action.

[The full study is available at the Booz&Co. Web site.]


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