Does Communication Affect Revenue?

Effective communication is not just a good business practice; it's the most important driver of profits. Your external and internal messages must get through to their target audiences or your business may bog down in expensive delays, mistakes and poor customer service. Don't think of communication as a nice thing to have. Think of it as your primary resource for making money.

Significant projects require individuals, teams or departments to work together. For example, a new marketing initiative requires the sales department, the production department and the marketing department to time their efforts together and resolve issues as a group. A breakdown in communication can thwart the new marketing effort and cause it to fail. On the other hand, clear communication can help create a well-timed and organized effort that results in more revenue for the company.

Communication is not a one-way street. If managers issue directives and never get feedback about how effective their decisions are, your business can lose money through dead-end efforts. Effective feedback from employees, supervisors and customers lets you know if your efforts are working so that you can emphasize those tasks that contribute to your bottom line.

Appropriate messages depend on word choices. According to the website Global Learning Partners, Inc., choosing positive, non-critical messages when dealing with customers can improve customer satisfaction and, therefore, sales. Conversely, saying things such as, "We can't do that," or "It's your fault," can turn customers away and cause your business to lose revenue. Similarly, brow beating employees through excessive criticism can ruin morale and decrease productivity, which will affect your ability to deliver goods or services.

The website Striata.com points out that poor language mechanics can give people the impression that you are not providing accurate information and you are not a serious professional. In addition, your online communications may be viewed as spam, because poor grammar and spelling has become the hallmark of digital con artists. This damage to your reputation can hurt your ability to sell.

Consistency in your marketing messages, internal expressions of your vision and directives to align your goals with your mission create a unified company where everyone is moving in the same direction. This type of communication efficiency can translate into a smooth operation that wastes little money on errors, misconceptions and unnecessary corrections. In other words, if your workforce is working in the same direction, you're less likely to spend time and money on tasks that don't contribute to profitability. At the same time, your customers will gain a clear understanding of who your company is and what it does, and this improves your brand recognition. Strong brand recognition can bring you repeat sales.