Communicating for the bottom line: the human and financial impact of communications

$12.0 Billion Dollars! That’s the amount of waste documented in the US Hospital System due to poor communications according to research from University of Maryland reported in 2009. At the time that represented about two percent (2%) of hospital revenue nationwide!!!

Think about that,…when the average Hospital Margin at the time was 3.6%.

In 2008 IDC research documented by David Grossman demonstrates that American and British Companies lose $37 Billion annually due to poor communication.  This is where employees misunderstood or misinterpreted information about a company policy, process, or job function. Clearly, the way we communicate has an economic impact on our organizations performance.

Then there is human performance and the role communication plays there. Research reported in the book “Words Can Change Your Brain”, Newberg and Waldman report that just seeing the word “NO” can release a neurochemical cocktail that will shut down the creative parts of your brain. If someone is hooked to an fMRI, you can see the brain function move from the front part of the brain where we are collaborative, creative and innovative, to the lower part, the Amygdala, where we are thinking only of survival. This is in part why the military trains and drills for dangerous situations over and over again.  It allows the troops to bypass that hijack and perform in stressful situations. Where do you think your team functions best?

Long term exposure to this stressful neurochemical cocktail can also lead to brain damage, heart disease and death.

Now that you can see the impact of communications, what can you do to create environments for your organization and people to thrive?

There are two big area to address are:

  1. You structure conversations for performance.
  2. You create a drumbeat or cadence of communication that reinforces the culture, goals, and intent of the organization.

I have been a Toastmaster for many years and their evaluation process is designed to provide “critical” feedback in a way that enhances the next performance. It is different from many “critical” conversations where we hear a manager describe everything that the employee did wrong. Instead, if we can understand the employee’s communication style, we can make the conversation productive through a structured approach. One way is to acknowledge their effort or something positive before going to the improvement. This reduces the perceived threat.

Employees and teams want to be connected to the organization and to each other. The way you as a manager can facilitate this is by mastering two kinds of conversations. The team conversation and the 1:1.

When you share with the team how they are doing as a team, how the organization is doing and how they impact the organization, engagement goes up. Particularly with the Millennials, they want to be tied to the bigger purpose of the organization.

Gallup reports that in 2017 employee disengagement went up to 70%. And they show that the number one factor in employee disengagement is the relationship they have with their boss. Your 1:1 conversations are your most powerful tool for building relationships with your employee. Unfortunately many managers end up canceling these or not holding them because they have “work” to do. Let me suggest that your most important work as a manager or leader is your people.


Four things to consider

  1. Connect with why you care about your team and their performance.
  2. Consider the language you will use in your communication.
  3. Consider how they like to receive information (some like data, some are afraid of change). The way you communicate with each can change and their receptiveness will improve.
  4. Consider your rythm… how will you continue to beat the drum of performance, intent, and culture?


If you would like to learn more about how communication can help your teams perform more productively and profitable please send me an email at



Copyright 2018, John R Gies | All Rights Reserved

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