How to Overcome Communication Barriers as a Business Grows?

Effective communication can connect individuals and teams, leading to efficient overall collaboration. When a business excels in this aspect, it can consistently transmit critical information and data to relevant individuals. By processing and utilizing this information, it can enhance efficiency, assist decision-making, and support empowerment.

If communication is not smooth, it can prevent strategic directives from leaving the CEO’s office, provide middle managers with opportunities to exploit “information gaps” for malicious purposes, and result in a proliferation of rumors while diminishing trust in official communication.

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As businesses grow, with an increase in personnel, these issues can become even more challenging to avoid.

In this article, we will discuss how, during the process of a business expanding:

  • The seemingly minor matter of information communication can turn into a troublesome one.
  • The three major pain points caused by poor information communication that can make people miserable.
  • What experiences can be borrowed from enterprises that have successfully “crossed the abyss”?

01-How Does the “Small Matter” of Information Communication Become a Problem?

In smaller businesses, effective information communication and collaboration can often be achieved through informal means, with communication happening naturally. However, as a company grows, four major obstacles can turn the seemingly simple task of information communication into a complicated one.

1.1 Barrier One: Organizational Hierarchy

In the early stages of business development, or even with just two levels of organizational hierarchy, the founder/CEO can effectively communicate with everyone directly, using a “person-to-person” approach for both big and small matters.

As the company grows and the number of employees increases, it becomes impractical for the founder/CEO to maintain this “person-to-person” approach. The organizational hierarchy expands to at least three levels, and the founder/CEO starts managing the company through a “person-to-person-to-person” approach. The intermediary “person” in this chain naturally introduces some information loss and perspective bias.

If the hierarchy expands further to four, five, or even more levels, and the communication still relies on a “person-to-person-to-person…to-person” approach, the information loss and perspective bias multiply, significantly increasing the probability of misinformation.

1.2 Barrier Two: Functional Department Silos

As a company grows, it often leads to more specialized roles and a significant increase in functional departments.

Due to inherent role and goal differences, different functional departments tend to view issues from their own perspectives. Typically, individuals prioritize their department’s goals, then the company’s goals, and lastly, the goals of other departments.

In reality, this situation can be even worse, with individuals focusing solely on their department’s goals, even if the company and other departments are facing significant challenges.

Therefore, it’s common to see that communication between middle-level employees from different functional departments cannot occur directly and must go through their respective superiors. Whether these superiors become “resistors” in the information chain, whether they “cut off the circuit,” or whether they “raise red flags” depends on their personal inclinations.

This phenomenon is often described in various ways, such as “U-shaped communication,” “silo mentality,” “departmental walls,” and so on.

1.3 Barrier Three: Geographic/Space Segmentation

As a company grows, it’s not always possible for employees to be physically present in the same geographic or spatial location.

Geographic segmentation refers to locations such as Beijing, Shanghai, or Shenzhen.

Space segmentation refers to divisions within the same office building, such as different floors or office zones.

While there are many tools for instant remote collaboration that allow collaboration to transcend geographical and spatial limitations, research indicates that in effective communication, the impact breakdown is roughly 7% text, 38% tone of voice, and 55% body language. Emotions play a crucial role as “messengers,” primarily conveyed through body language and tone of voice. Truly effective communication often occurs in the same room.

1.4 Barrier Four: Sociopsychological Barriers

As a company expands, it becomes more diverse in terms of its workforce. Different individuals have been shaped by their past experiences, both in life and in the workplace, which have led to sociopsychological biases.

These sociopsychological barriers can significantly affect the effectiveness of internal information communication within an organizational structure. For example:

  • Fear of overstepping boundaries and levels of authority, leading individuals to focus solely on their own responsibilities.
  • Apprehension about differing viewpoints from superiors, which may be perceived as disrespectful, causing individuals to be cautious and cautious while trying to decipher their superiors’ expectations.
  • Concerns about being seen as attention-seeking or credit-hungry, causing some to remain reserved and hesitant to contribute.
  • Some technical professionals may prefer to work quietly and independently, but their lack of visibility might be misinterpreted as a lack of contribution by sales teams and others.

As a company expands, these four major barriers become more pronounced, causing frustration among employees. Middle management often resorts to complaining, merely finding solace in venting their frustrations. Senior management frequently dismisses these issues as trivial “small matters” and may view discussions on such topics as a waste of time. Some executives who contemplate raising these issues may fear being labeled as lacking “vision” or “broad perspective” and, therefore, choose to remain silent.

Human resources departments often find themselves eager but unable to address these challenges and may resort to suggesting the establishment of a communication or publicity team/department.

As a result, many companies, despite their considerable size, continue to approach the “small matter” of information communication with the mindset and inertia of small organizations. They rely on their members to adapt on their own, pushing forward with unwavering determination while consuming their resources in a protracted battle, all while awaiting the elusive dawn.

02-Three Major “Pain Points” Caused by Poor Information Communication That Make People Miserable

There are many painful consequences of poor information communication. Below, we will discuss three “pain points.”

2.1 Pain Point One: Strategic Directives Don’t Leave the CEO’s Office

In smaller companies, the information communication chain is short, and organizational members often share a common language and experiences with the founder/CEO. A single sentence or even a glance can convey mutual understanding, making it relatively easy to achieve “one heart, one chart, one battle.”

As the company grows, the information communication chain lengthens, and the likelihood of the “long whip effect” increases. If the founder/CEO does not reassess the new challenges of information communication, they may underestimate the difficulty of strategic communication and the time investment required. They may also overestimate their own strategic communication abilities (which may have worked before but are inadequate as the company expands) and overestimate the subordinate teams’ understanding of the strategy (as the previous close-knit group may have been replaced by a new team).

2.2 Pain Point Two: Middle Managers Exploit “Information Asymmetry”

As a company expands, “information asymmetry” becomes more common and can easily trigger unethical behavior. Some middle managers may exploit this information gap for personal gain, gaining control over subordinates, managing impressions with superiors, and manipulating expectations horizontally, all of which can harm the organization’s interests.

In the first scenario, middle managers gain control over subordinates by using “information asymmetry.” They filter critical information, breaking it down into fragmented tasks and assigning them to different subordinates. Then, they integrate the work results of their subordinates through the completeness of information. This approach provides them with control over their subordinates but significantly impacts employees’ sense of effectiveness.

In the second scenario, middle managers manage impressions with superiors by selectively conveying information, often only reporting good news and withholding problems. This approach helps them gain short-term trust from higher-ups but prevents senior management from understanding the true situation on the front lines, leading to erroneous decisions in major judgments.

In the third scenario, middle managers manipulate expectations horizontally through “information asymmetry.” They often exaggerate the complexity of the processes they oversee, giving themselves flexibility and leeway when passing the baton with upstream and downstream counterparts. This practice undoubtedly leads to delays in progress and resource redundancy.

2.3 Pain Point Three: Proliferation of Rumors Undermines Organizational Trust

Rumors, also known as “word on the street” or “grapevine communication,” refer to unverified information spread through informal channels.

Despite being unverified, rumors often gain people’s trust. This is because it’s commonly believed that rumors tend to convey information that upper management is unwilling, afraid, or unable to share officially.

As a result, rumors easily carry emotional undertones, and emotions give them greater propagation power. During the dissemination process, at each step, those spreading the rumor may unconsciously add their own interpretations and modifications based on their preferences and imagination. After multiple iterations of modification, the truth may be greatly distorted or lost altogether.

Furthermore, in organizations, many individuals rely on rumors to maintain so-called “interpersonal trust.” If you don’t share rumors with me, we’re not on the same page. This kind of social coercion clearly comes at the cost of organizational trust.

In a sense, rumors are the natural enemies of organizational trust.

03-What Can Companies Learn from Successful Organizations That Have Successfully Overcome These Challenges?

Regarding information communication, the bad news is that every company will encounter such challenges as it grows. The good news is that many pioneering companies have already explored these issues, and there are few entirely novel problems under the sun.

Let’s take a look at what companies that have successfully overcome these challenges can teach us and what lessons we can borrow from them.

3.1 Executives Need to Enhance Awareness and Understanding in This Area

Executives should not deny or evade the complexity of information communication as a company grows; instead, they should acknowledge and accept, understand, and address this troublesome “small matter.”

In fact, being stern, appearing serious, and using vague language do not reflect executive temperament. Over-communication of important matters is an effective principle for executives to manage information communication in large organizations.

Let’s take strategic planning and communication as an example.

When a company is small, executives can allocate their time as follows: [90% strategic planning + 10% communication]. If the strategic direction is wrong, there’s no need to worry; the company can make quick course corrections and iterate rapidly. Then, another round of [90% strategic planning + 10% communication] can follow.

As the company grows, the time allocation structure should shift to [70% strategic planning + 30% adjustment + 900% communication]. The 30% adjustment is necessary because a large ship takes time to change direction, and frequent strategic changes can lead to significant organizational turbulence as the company grows. The 900% communication is needed because large organizations must invest additional effort to ensure seamless information transmission.

To excel at 900% communication, there are some strategies to consider:

When it comes to something relatively complex like strategy, think of it as a gas, spoken words as a liquid, and putting it in writing as a solid. It’s not enough to just say a few words verbally; it should be presented and expressed in a structured manner. Tools like strategy houses, strategy maps, OGSM (Objectives, Goals, Strategies, and Measures), and others can be used for this purpose.

How can you ensure that subordinate teams have a thorough understanding of the strategy? Relying solely on eye contact or signatures is not sufficient. An effective approach is to dive one level deeper and communicate at the “key tasks” level. Ensure that the next steps planned by the subordinate teams align with the correct objectives. This way, you can guarantee that they have a proper understanding of the strategy.

Another valuable lesson is to “communicate important matters 21 times.” This wisdom comes from a successful CEO I’ve heard of and observed. He led a company for a decade, during which they successfully achieved a strategic upgrade, increasing their market value by more than fourfold. When it comes to communicating critical matters like strategy, his mantra was to “repeat important things 21 times.”

This idea is not unique. In the book “The Real-Life MBA,” Jack Welch suggests that a CEO is not only the Chief Executive Officer but also the Chief Explaining Officer. He emphasizes that an employee dedicates their valuable 40 hours per workweek to the company, which is a form of investment. The CEO should continually explain what the company is doing and why, just as they would explain to investors. Repeating the same message hundreds of times may seem repetitive to you, but for many others, it might be the first time they’re hearing it.

3.2 Make “transparency” the primary principle of communication

Take the example of informal grapevine communication mentioned earlier. Since it’s certain that informal grapevine communication will persist and even thrive, the focus should not be on how to handle informal grapevine communication, but on how to promote open “official communication” channels. The prevalence of absurd grapevine communication is a result of ineffective formal communication channels.

In reality, except for the rare occasions when information needs to be kept confidential, most information within a company should be made known to relevant individuals as much as possible. To succeed and thrive, a company should confront its operational and management issues head-on. It should not be afraid to use formal communication channels to engage in dialogue with employees, eliminate differences, reach consensus, and gain understanding and support.

When all necessary official information has been communicated, informal grapevine communication will eventually align with official communication.

As mentioned earlier, some middle managers exploit “information gaps” for personal gain, harming the organization. To address this issue, the same principle applies: promote transparency as much as possible. Transparency leads to empowerment, as it empowers and enables employees, as well as those both upstream and downstream in the organizational hierarchy. Only by doing this can we limit the potential for “human nature’s dark side.”

3.3 Seek solutions in organizational, job, and role design

For example, some companies clearly assign responsibilities for drafting, publishing, announcing, and disseminating important documents to departments like the CEO’s office, human resources, and administration.

In the book “Growth Hacker Marketing,” it is mentioned that some internet companies, in order to break free from “traditional silos” (also known as “deep well syndrome”), establish formal or informal organizational structures like “growth teams.” These teams consist of cross-functional specialists, such as product managers, software engineers, marketers, data analysts, and product designers, who often work together in the same location and report to the head of the growth team, typically a senior leader. This approach ensures transparent, timely, and unhindered communication, guaranteeing the achievement of critical tasks.

Here’s another example: in advertising agencies, which provide non-standardized professional services, they often create a role called “Traffic.” The main responsibility of this role is to facilitate communication among the creative department, project department, and client department by coordinating activities such as briefing meetings, brainstorming sessions, and creative reviews to ensure that the relevant parties attend.

In some cases, traditional companies transitioning to the industrial internet set up dual product manager roles to address communication and collaboration between business teams and research and development teams. One is a BPM (Business Product Manager) with a background in business who has a deep understanding of the business and can abstractly summarize it. The other is a TPM (Technical Product Manager) with a background in research and development who can understand the business, reconstruct scenarios, and define product features.

3.4 Empower middle management with communication-related skills

First, empower middle management to distinguish between different types of communication.

Different types of communication have varying degrees of listener responsibility and action orientation. Different types of communication require different communication approaches. Individuals who have not worked in large organizations often lack awareness of the different types of communication and may unconsciously use casual “chit-chat” communication methods for other types of communication.

  • Discussion: This type of communication has a low degree of listener responsibility and action orientation. It is used for brainstorming, sharing opinions, and exploring ideas.
  • Information Sharing: In this type of communication, the listener’s responsibility and action orientation are slightly higher. It is used for sharing information, updates, and news.
  • Instruction: This type of communication has a higher degree of listener responsibility and action orientation. It is used for giving clear instructions and tasks.
  • Decision-Making: Decision-making communication has the highest degree of listener responsibility and action orientation. It is used for making decisions, setting goals, and assigning responsibilities.

Understanding these distinctions helps middle management choose the appropriate communication approach for each situation. Empowering middle managers with effective communication skills and the ability to adapt to different communication types can greatly enhance communication within the organization.

3.5 Establish an efficient information communication environment, scenarios, and mechanisms

Creating an open workspace environment can also significantly promote information communication. For instance:

  • Some companies adopt large open-plan office spaces instead of segmented and closed office spaces for different departments.
  • Some companies provide numerous negotiation spaces, meeting rooms, and conference rooms to facilitate face-to-face communication.
  • Some companies have office partitions that extend beyond desktop height by 33 cm, ensuring minimal personal disruptions while also allowing employees to see each other’s expressions for better communication.

Standardizing communication tools and information dissemination platforms is another important mechanism for large organizations to address information communication challenges. Tools like enterprise messaging apps,OA information announcement platforms, and more should be unified across the organization. Relying on diverse tools and platforms can create physical information silos, making it difficult to achieve the desired transparency.

Furthermore, it’s crucial to classify and manage company management-related meetings and prioritize the distribution and management of meeting minutes.

When a company is small and doesn’t have too many issues to address, managing meetings with a few key decision-makers is sufficient. However, as a company grows, the number of participants in meetings can increase, and discussions on individual topics may become more time-consuming. At this point, classifying and managing meetings becomes necessary. Different types of meetings, such as those focused on various topics, functions, and purposes, may require different frequencies (weekly/monthly/quarterly/semi-annually/annually/ad-hoc), involve different participants, employ different meeting formats (information updates/discussions and decisions/strategic planning), and even require different emotional states (enthusiasm, seriousness, etc.). Without proper classification and management, meetings may not be as effective, which, in turn, affects the effectiveness of information communication during these meetings.

Once meetings are classified and managed, not all members will attend every meeting, making effective distribution of meeting minutes essential. Well-managed companies prepare meeting minutes, which are signed off by relevant decision-makers and published on the information platform. Copies are sent to those concerned to ensure accessibility (if not confidential).

Some companies also establish distinctive information communication scenarios. For example:

  • CEO’s all-staff messages
  • Executive leadership channels for direct communication
  • Employee feedback sessions
  • Cross-functional alignment meetings
  • Town Hall meetings

These scenarios are designed to connect information islands, break down information barriers, and facilitate transparent communication within the organization.

Conclusion

I would like to end this somewhat lengthy article with some survey data found online and a reminder: as companies grow, the importance of effective communication should not be underestimated.

  • 86% of employees believe that a lack of effective collaboration and communication is a major reason for work failure (Source: Salesforce)
  • 97% of employees believe that communication affects their daily work efficiency (Source: CMSWire)
  • 28% of employees believe that communication issues are a reason for not delivering work on time (Source: ExpertMarket)
  • When employees have better communication skills and tools, productivity can increase by 30% (Source: Salesforce)
  • Improving internal communication can increase organizational productivity by 25% (Source: McKinsey)

For those of you who have read this article, if you have any practical cases, insights, or suggestions regarding information communication during the process of a company’s growth, please feel free to leave a comment and share your wisdom!

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