Internal comms review: Every recession takes a toll on company culture

2024 has been a bumpy start for many businesses. As the economic pressures of the last year snowball into real world cuts.

Every recession takes its toll on company culture. From the pairing back of ‘nice to have’ investments. To the fraying of internal comms, as decision making becomes dynamic and faster paced. And in extreme circumstances, organisations even start to cut back on vital social impact initiatives.

If the turbulence of the past five years has shown us anything, it is the importance of continuing to invest in employee engagement, during extreme highs and lows. Due to the emotional contract between an employee and employer, they can be your greatest advocate or a powerful detractor. With the potential to damage your reputation and business performance more than any other stakeholder group.

Yet, businesses are missing a trick when it comes to how and when they engage and inform employees on initiatives which warm their hearts or clear their desks to make work life better.

When it comes to ESG, in an employee’s market: a company’s commitment to environmental action and diversity and inclusion is key to attracting and retaining talent. Particularly with socially conscious GenZers entering the workforce.

Yet as the pendulum shifts to an employer’s market: a TEAM LEWIS survey of 2,000 employees across the UK found a worrying gap between business ESG progress and employee education, activation and participation.

Key findings included:

• A third of employees believing that their employer is all talk and no action when it comes to environmental and social goals.
• 17% of employees saying they never receive updates about their employer’s sustainability progress with less than half receiving updates on a quarterly, monthly or weekly basis.

As economic pressures increase, so does the need to strengthen company culture and keep employees engaged and informed. So how can internal communicators innovate? Take AI as another example. Even though the adoption of artificial intelligence (AI) is increasing at a fast pace, 71% of organisations do not provide internal communicators guidance on when, where or how to use the technology, according to Gallagher’s 2023/24 State of the Sector report.

The State of the Sector report found communicators who are using AI are three times more likely to believe the technology will reduce workloads. AI adopters were also 20% more likely to believe it will improve the quality of communications. While AI can drive efficiencies and unlock new ways to communicate, Gallagher experts recommend organisations focus on getting the basics right, as well as seeking out training opportunities and feedback mechanisms to get the best return on investment.

In recession, we also see more innovation. So now is the perfect time to think differently and apply new creative techniques to ESG storytelling and review the efficiencies and improved impact of AI technology. The golden thread to all this is keeping it grounded in human values.

New technologies designed to improve efficiencies have not replaced the importance of how people connect, create and collaborate for success. In fact, The State of the Sector research showed that 8 of 10 communicators (84%) rely on their managers for key information. The topics managers most regularly communicate on include strategy, vision and purpose; values, behaviors and culture; and organisational change integration or M&A activities.

So whatever next this year brings, we are all better set up to succeed, when aligned on our values and the end ambition – to keep our heads, hearts and the bottom line in balance.

This week's Internal Comms commentary is written by Sarah Ogden, MD UK, of PR agency Team Lewis.