Proving a Role’s ROI: Get Ready

The communications leader worked hard to demonstrate to leaders how vital his team’s work had been—at a time when everything from social media to world events was making the firm’s messaging more critical than ever before. But in the era of AI, proving your worth becomes complicated.

A new survey of 5,000 internal communications professionals show that a shocking nine out of ten are struggling to validate their department’s return on investment for leaders, even as only 40% percent say their bosses understand their value “very well.” The results come even as companies, at the behest of communications leaders, have prioritized the department and increased its budget in recent years. But proving its worth has proved difficult. “Every year for my birthday, I ask for a ROI calculator for communications, and I’ve yet to receive one,” says Tamara Rodman, a senior client partner in the Culture, Change, and Communications practice at Korn Ferry.

To be sure, measuring the impact of communications on culture, engagement, and retention is much more difficult than showing how work translates to revenue or profit growth. While other functions can present profit-and-loss statements, communications relies on metrics like pulse surveys, manager feedback, and employee testimonials in order to draw connections to key business imperatives. Yet nearly half of survey respondents concede that those metrics don’t resonate with leaders, particularly when compared to the prospect of AI handling many aspects of the role much more cheaply. “The things that internal communications functions typically measure sound very vanilla and unexciting to the board,” says Peter McDermott, head of the Corporate Affairs practice in North America for Korn Ferry.

As AI looms, raising questions about ROI, many corporate functions—including human resources, accounting, legal, marketing, and other support and administrative functions—are also being challenged to demonstrate their impact on business results. And with leaders fixating on the efficiency and productivity of humans relative to that of AI, the challenge will only get harder. “In times of economic upheaval and great change, if you can’t connect performance to business results, then your job could be up for grabs when times get tough,” says Kim Waller, a senior client partner in the Organizational Strategy and DEI practices at Korn Ferry.

McDermott says that comms leaders can point out that strong communications saves money by improving retention across the company, for instance. Finding and onboarding an external hire can cost firms three to five times more than keeping an internal one. “Communications can draw a line not only to overall enterprise savings,” McDermott says, “but also to the impact on budgets for operating functions.” Cybersecurity training is another example. McDermott says engaging employees to take the necessary training connects to the bottom line. “One bad breach doesn’t just cause reputational damage,” he notes. “It costs billions of dollars to rectify.”

Internal communications functions have been slow in establishing their bottom-line value because, for one, they’ve lagged in integrating data and analytics into their work. They’re woefully behind their peers in marketing, for instance, who quickly adopted performance analytics to show how a given campaign led to a specific action like a click, lead, or sale. One-fifth of communications professionals still use printed posters or newsletters to get messaging out, according to the survey, while 63% cite email as the most popular method. “You can’t measure how many people see a poster in the break room,” says McDermott.

Richard Marshall, global managing director of Korn Ferry’s Corporate Affairs Center of Expertise, agrees, but identifies a critical metric that internal-communications functions—and other supporting functions—can use to demonstrate their value: the firm’s share price. In what is essentially a “permacrisis” environment, Marshall says, there’s no better indicator of company reputation than how investors view it in the marketplace—and this, in turn, is rooted in talent and performance. “In moments of transition like we are in now, internal communications is the ‘campaign battleground’ to win the hearts, minds, and discretionary efforts of the front lines of business,” says Marshall. 

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