They’re young. They’re mobile. And in many ways, they match the profile of the typical unsatisfied worker. Yet the employees at Bob Evans restaurants feel so comfortable with their management — have such a strong sense of belonging — that after a long shift on their feet, many go home and share their thoughts, concerns, and ideas with chairman and CEO Steven A. Davis in back-and-forth conversations on his blog.

Many of the strategic communication tools that have generated so much energy and created so many relationships on the Internet are proving highly effective in human resources too. Businesses are communities, after all. Even the Internal Revenue Service is showing interest in using social networking technology to help boost the morale of its often-beleaguered employees.

But at a time when information can move at the speed of light through an optical cable, many employees are feeling more left out of the loop than ever before. “I don’t know how many times I’ve visited companies where I’ve heard employees gripe that they’ve heard everything on the outside before they’ve heard it on the inside,” says Jim Ylisela, president of Chicago-based Ragan Consulting, a provider of internal communications expertise and training. “That has a crippling effect on morale, productivity, and employee engagement.”

It can also lead to high turnover rates — an expensive proposition. The Department of Labor estimates that replacing an employee can cost a company one-third of a new hire’s annual salary.

Catch the Revolution
It’s a common mistake to believe that the highest priority for public relations efforts is to focus on the outside world, experts say. But spreading information within a company is as important as getting it to the media and even to customers. “Everything begins internally,” Ylisela notes.

And employee communication is facing an unprecedented revolution, given the rapidly expanding capabilities of the Internet and social networking. Savvy businesses are using integrated Internet marketing tools ranging from e-newsletters and blogs to video and interactive feedback sites to give their employees a chance to find out what’s going on and have a say in their company.

Companies that neglect these areas could potentially find themselves facing a brutal kind of backlash, as external blogs and forums provide an environment where rumors can thrive and spread with stunningly toxic results. Even though many small and midsize companies rarely feel the glare of major media attention, the people who work for these businesses are trading information back and forth all the time.

“For every official strategic communication you make to your marketplace, you’re going to have 50 conversations within your company about your products, services, and mission,” says Fred Pfaff, founder of the New York–based consultancy Fred Pfaff Inc. “Your reputation is being shaped by these little actions that happen day to day, minute to minute.”

Most companies think they can control the flow of information by issuing proclamations from on high. This, Pfaff says, is a big mistake when dealing with the feedback generation, which is used to a blog-saturated, Facebook-oriented world where everyone not only has an opinion but also gets to share it with the entire world. “A lot of the less evolved internal communications come from the vantage point of giving people the school-style solutions — provide them with a script, give them a speech,” Pfaff points out. “This can leave employees feeling uninvolved and misinformed, which can cause serious damage more rapidly than ever before, devastating everything from customer service to productivity to the very value of a company’s brand.”

Who Takes Ownership?
For growing businesses with a limited budget, whiz-bang technology isn’t the most important aspect of effective internal communications. What’s critical is to give employees a sense of belonging and participation. Whereas external public relations can focus primarily on sending a message to the outside world, internal communication is a two-way street. “The first step in any kind of communications planning is to go out and listen to people,” Ylisela says. “You have to start by assessing where your communication sits before you can decide what to do to make it better and how to proceed.”

A crucial part of that assessment is determining where responsibility for internal communication should sit, according to David Ferrabee, managing director of change and internal communication at Hill & Knowlton UK. A lot depends on the kind of issues a company is facing, and even where it is based, he says. For example, in an environment where labor unions play a strong role or major personnel changes are occurring because of mergers and acquisitions, human resources might be best equipped to handle communications. For a growing business facing simpler issues, internal communications might best be the responsibility of the marketing department.

“There are great companies doing really interesting internal communications from both corporate communications and HR,” Ferrabee says. “I have personally moved an internal communications function from corporate communications to HR and back again.”

By the Book
Setting strict rules and abiding by them is also essential. While participants in blogs, corporate social networking sites, and other back-and-forth environments need to know they have the freedom to speak and even hold intense discussions, they must also realize there are limits, as inappropriate statements can have serious repercussions. Such limits can be defined in a way that both respects employees and encourages discussion. Sun Microsystems has gained plaudits for the simplicity of its approach. There’s one rule: “Don’t be stupid.”

It’s a motto many in the business world could live by.

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