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Why is it so damn hard to get companies to spend money on internal communication?

BY mikeklein

Having worked for twenty-plus years in internal communication (IC), there’s a big factor of life that never computed for me, that never made sense.

Why do internal communicators have such a hard time getting even the most basic initiatives funded?

Is it simply because it’s hard to demonstrate a concrete return on investment (ROI) case for many expenditures? Or is it because IC expenditures are held to an entirely different standard, assessed in an entirely different way?

I’ve been interviewing business communicators and leaders for the last six months on behalf of digital workplace vendor Happeo, with budgets and measurements a key focus. And what I found is that IC investments are far more likely to be measured against “CWE” than they are against ROI.

What is “CWE”?

It means “communicating well enough” or, alternatively and more brutally, “communicating without expenditure.” 

Indeed, when internal communicators propose expenditures, whether on campaigns, technology, new staff or consultancy, they are frequently pushed back with the questions: “How much of this can we do on our own?” “How can we make better use of our existing resources to cover part of this?” Or, more bluntly, “Isn’t this supposed to be YOUR job?”

This pursuit of false economy is not unknown in other corners of the corporate world. But it’s prevalent in internal comms because there’s an intrinsic focus on using internal resources to reach internal people, and because employee populations are relatively small compared to customer bases in B2C or citizen numbers in a government context, for instance. Those relatively small numbers lead to pressure to keep cost-per-employee figures apparently reasonable.

Said one corporate communicator:

“IC is the cheapest comms function to run, we can operate creatively and effectively without much (running) cost, like running a global webcast for EUR 500 for 20,000 employees.”

CWE isn’t a problem everywhere, particularly since most IC expenditures are peanuts in the scheme of things for billion-dollar enterprises.

One participant in my latest research for Happeo, in a very large company, actually said: â€œSpend is not a major issue. Cost has never been a showstopper.”

But such flexibility can be deeply dependent on the sense of urgency pervading a given business. Another large-company participant in the Happeo research injected:

“In a crisis, no one questions the need for investment in tools. Outside of a crisis everyone asks for the ROI.”

An insight into this paradox can be found in the continuing reliance of some companies on email as a primary Internal Communication channel.

“Companies rely on email because they don’t invest in the toolset.”

So, what should one do when confronted with comparing a preferred option with a CWE request:

  • Assess the business urgency - both from the stakeholders involved and the extent to which an initiative can be seen to help the company strategy (or mitigate risks)
  • Look at the overall context of team capacity and priorities. Some initiatives can be executed “for free” – but with the hidden cost of deprioritizing other initiatives or adding pressure to a “maxed-out” team. Revealing those hidden costs may make your preferred initiative look more attractive.
  • Re-baseline expectations of current infrastructure – if you are trying to secure investment in new tools or infrastructure, an inventory of current infrastructure weaknesses, liabilities and vulnerabilities (as in “we can try doing this through our current intranet but only .5% of our employees will see it) could strengthen the case for action
  • Highlight the hidden cost of one-size-fits-all – if you want to undertake an effort to identify internal influencers and engage them better as a filter for corporate noise, come up with a calculation for the amount of time you ask employees to spend consuming unneeded or irrelevant corporate communication.

CWE is all about false economy – combined with a persistent belief that internal comms should essentially be “free” as a matter of principle. But it can be overcome when false economies are exposed as real risks, liabilities and costs. And in identifying “CWE” openly as an actual financial benchmark for internal comms, I sense it will be far easier to challenge it and push for better initiatives and solutions.

To register for a download of the latest research into the Present and Future of Internal Communication from Happeo, click here

MIKE KLEIN is Principal of Changing The Terms, a communication consultancy based in the Netherlands. Mike’s international practice includes work with Fortune 500, start-up and specialist clients across borders and sectors in Europe, the UK and the US. Mike holds an MBA from London Business School and is the 2018-2019 EMENA Chair of the International Association of Business Communicators (IABC). To schedule a free consultation, please click here.


3 thoughts on “Why is it so damn hard to get companies to spend money on internal communication?”

  1. Mike, I appreciate that your article is all about finding the underlying costs associated with not improving internal communication. I do think that any new initiative for a company needs to be justified with ROI. And almost any company is rife with unnecessary costs, which if removed with something like better IC, would be a great ROI

  2. I think it needs justification, but ROI is often deeply underepresentative of the value IC provides.

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