The Impact of Good Business Communication

The Impact of Good Business Communication

A business can do everything right, but if they have poor business communication, they’ll never succeed. You are your business. You need to make sure you have the ability to communicate your goals and priorities to yourself, your partner and to others that that are involved in your bottom line.

Business Communication Leads to Trust

Think of a doctor you’ve had that you’ve loved. Did they communicate well? Did they take the time to talk to you and help you feel valuable and your needs important? It turns out there’s research to back this up. It turns out that doctors that effectively talk to their patients get sued a lot less. This is basic human instinct. We can’t trust you if we don’t know you. We can’t trust you if you don’t try to know us.

Communication Leads to Brand Loyalty

I live in Alaska (if you haven’t figured that out yet) and I want to tell you a story about Alaska Airlines. You see, back in the day, Alaska airlines pretty much had a monopoly on Alaskan flights and they could charge anything they wanted. Before competition started heating up, Alaska Airlines realized the huge market they had in Alaska and got wise. Instead of continuing to gouge Alaskans, they held a sort of town hall meeting for Alaskans and asked them what they valued.

Alaskans complained that they couldn’t get to Juneau during the legislative season to make their voices heard because flights were too expensive, so Alaska Airlines introduced an annual “legislative sale” on flights to Juneau.

Other complaints were addressed with a specific membership club available only to Alaskans called Club 49. If you live in Alaska (and can prove it), you can join for free.

Alaskans complained that they couldn’t travel last-minute for state athletic competitions or funerals because last-minute flights were too expensive. Now, Club 49 members get 2 annual coupons for 30% off a one-way flights booked within 4 days of travel.

Alaskans said that they used luggage to bring expensive-to-ship stuff home (like our own Trader Joe’s imports), so Alaska Airlines gives Club 49 members 2 free checked bags.

All of these concessions didn’t cost the company a whole bunch of money, but it did buy loyalty. A few years later, Delta tried to make a power grab in Juneau. It didn’t work out. Customers preferred Alaska Airlines because they effectively communicated with Alaskans (we’re pretty brand loyal here, too).

You Are Your Business

You are the one that cares about your finances more than anyone else and you are the CEO of your own company. It’s your job to make sure there is good communication happening. Without good communication, a business fails.

  • Communicate With Yourself – You are the most important player in your business. If you don’t know what you really want, if you don’t know yourself, or if you haven’t picked your path, your business (and your finances) will go nowhere. If you don’t know your financial reflexes, you’ll fail because you don’t know your weaknesses.
  • Communicate With Your Partner – When you are partners in life, you’re partners in business. Talking about money is often awkward, but what if I told you about two co-founders of a business that never once talked about the financial goals of the business. You wouldn’t want to invest in them, would you? That would be crazy! You are in this together and you need to talk about your goals and how finances play into those. If you’re both heading in different directions and you don’t communicate enough to know, you won’t find out until you’re too far apart to hear each other.
  • Communicate With Your Children – If you have kids, they are a part of your business. Consider them interns that are set to inherit the company. Interns don’t start by knowing the intricacies of the business finances. They start by learning the company values, the company communication, the company goals, and getting used to the company culture. Do your kids know your goals? Do your kids know how money plays into those goals? Do your kids know how to perform basic business tasks (ie: how much groceries cost, how much your house costs, etc?).
  • Communicate Your Business to Others – People are always trying to get you to spend your money. Sometimes a well-prepared excuse can get you out of a money spending situation, but businesses don’t thrive on excuses. You need to be able to verbalize your company’s mission. If you do can’t effectively verbalize your goal, you’ll get distracted easily.

How Do You Use Communication to Make Sure Your Business is Flourishing?

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10 Comments

  1. This is quite a thoughtful post. My business is my household and family. As mom and wife, I am also co-CEO. My husband and I often sit down and look at the state of our union and that of our household, including finances. If something seems to not be going as planned, we make changes. It’s a constant effort to keep things running smoothly, but we do it because we know how important it is. In years to come, we hope our patterns and values are incorporated into our daughter’s adult life. So far, we feel like our company is pretty solid. 🙂

    • MaggieBanks

      It sounds like your business is on a fabulous course with your daughter deep into a good apprenticeship. 🙂

  2. Interesting, I’d never read about Alaskan airlines background. It’s very interesting how they’ve positioned their business to promote loyalty. Your right, communication is a big part of any business or household. Our kids are still to young to truly participate though we are starting to gradually educate them. However being on the same page with my spouse is critical. She understands fully where we are going and the steps necessary to get there. That not only helps in progressing us towards those goals but also keeps away strife. Afterall a leading cause of divorce is financial strife. I don’t want to be part of that statistic.

  3. “Would you invest in a company where the two owners never talked about their financial goals for the company?”

    Holy crap! That is so obvious I don’t understand why this concept is so alien to so many couples. As soon as Mrs. G and I got married we considered ourselves Team Groovy, and we always talked about money and goals. And because of that “business acumen,” we made progress on the financial baggage we each brought to the merged “company” from day one. It’s amazing what a little communication can do. Thank you for this wonderful post, Maggie. Great advice.

    • MaggieBanks

      I know! Right?! I think maybe it was easier for Mr. T and I because we got married in college, so we didn’t have any assets or income to deal with… when those things started to come, we were already together.

  4. I’ve found that working together as a team when it comes to our financial situation has improved our marriage. It’s fun to plot and dream together. And you don’t have to worry about anyone sabotaging plans when you have a joint understanding of the road map.

  5. Enjoyed the background on Alaska Airlines. The ROI they got from not yielding ground to Delta was probably well worth what they spent on gaining your loyalty. I’m jealous of your special club. I want one too. Even if doesn’t have the perks. If they have a secret handshake, I’m in.

    It is surprising to me how non-obvious it is to most software engineers that communication is key. Managers value good communicators. If you are a coding prodigy but your manager is constantly surprised by moving deadlines and changes in plans, you aren’t going to be compensated as well as you should be. Good communication is low hanging fruit and more folks should strive to pick it.

    • MaggieBanks

      I do love a good “in” club, too. One time, we checked in to our airline in DC (where there’s only one Alaska desk) and the desk agent thought we were royalty: “You get 10 free bags?!” It was hilarious. And I agree. If people can’t communicate, their skills are almost inaccessible.

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