Whether we like it or not, no organisation can escape the reality of the economic crisis even if they are not directly affected by it. The stress caused by everyone wondering what will happen next, a struggling housing market, question marks over retirement savings, sky-high fuel prices, not to mention credit and personal finance problems – all take a significant toll on employees, draining their productivity and ability to focus.
So it is all the more important that business leaders do what they can to help maintain employee morale. And according to communication experts at global consulting firm Watson Wyatt, that means confronting difficult issues and communicating clearly.
"The current turmoil in financial markets is obviously a distraction to workers," said Richard Guinn, senior communication consultant at Watson Wyatt in the U.S.
"While companies cannot advise their employees about their investments, they can reassure them about the security of their defined benefit pensions, which are government-backed.
Employers can also help their workers understand the implications of their 401(k) investment strategy, including the importance of saving, diversifying portfolios and taking a long-term perspective," he added.
Last year, Watson Wyatt found that companies with the most effective communication programmes reported a 47 per cent higher total return to shareholders from 2002 to 2006, compared with companies that communicated less effectively.
These companies were also four times more likely to report high levels of employee engagement as those that failed to get the message across.
Now, however, good communications could make the difference between staying in business and going under. So it's worth re-iterating some basic tenets for managers at all levels.
Be a leader. Leaders don't have to have all the answers. Tell employees what you know and what you don't. Explain the steps the organization is taking to identify issues and resolve problems. Knowing senior executives are there to lead through uncertain economic times is crucial to your people.
Show your strengths. Reinforce the core competencies and values that make your organization successful. Talk about how they will help the organization thrive in the future.
Be visible. Credibility, conviction and passion are important messages that only presence can convey. Employees can benefit from seeing engaged and informed senior leaders through Webcasts or other interactive vehicles.
Use your team. Make sure the management team knows how and what to communicate, and that no one is a bystander. Limit potential damage from leaders' informal conversations that are overheard and ripple through every organization.
Be coordinated. Coordinate your internal and external messages. Employees should hear company news from the company first.
Share responsibility. Be clear about what you want your managers and your workforce to do. People want to help — tell them how. It's never a bad time to reinforce customer focus.
Give up the myth of message control. Find ways to listen to what is on employees' minds. Monitor the press and social media for what is being said about your company and your industry. Have a process for quickly developing and distributing answers to rumors and for clarifying inaccurate statements, such as possible layoffs.
Finally, be humane. Some employees are experiencing personal trauma from thanks to the failing economy and falling house prices. Acknowledge their pain and make them aware of the resources at their disposal, such as your company's Employee Assistance Plan.