Communication skills

I want to share with you the results of one of the projects that I worked on as a project manager. I was responsible of minimizing the gap between financial revenue records and actual production records. I will not get into details of the project and what type of service I am talking about to avoid revealing business secrets. But I will say just enough to clarify how bad or missing communication can cause disasters. The gap they suffered from was both ways i.e. over booking of revenues that do not exist and under booking or missing revenues that should have been booked but they were not. The main problem though was in missing revenues that were not recorded. Over booking was minimal as it happened only when an order was cancelled and never reported to finance.

Most of the production records were missed and not listed as financial revenues. The company was actually losing money because no one kept clear and actual track of what they were actually producing and selling. When I started we had 50% gap between finance and production i.e. 50% of actual revenues were not listed in the company’s financial records. In only one month for example we had 87,000 LE missing revenues. I started working on this project on May 2005; on Jan 2006 I reached 66% reduction in losses.

You will be astonished to know that the main reason of such losses was communication issues. Involved teams did not have a common terminology to describe things. The financial team used certain terms to describe some things, while the production team used the same terms to describe totally different things. The production team itself was divided and did not have common terminology. They did not have common templates to fill for record keeping, they did not have a clear workflow and they did not have an established communication channel. Some people used to talk over the phone, others used the email and others did not bother communicating at all.

The service the company was selling was an online service, so it was dynamic i.e. sometimes the original cotract used to state something but after actual production lots of changes were introduced. Those changes sometimes increase the contract value, sometimes decrease it and sometimes ends up by canceling the entire thing. All those changes were never reported to finance, so they used to book only the original contract value. this resulted as well in a lot of revenue losses.

Most of my work was focused on:
1- Creating a clear workflow where every team member can know when to start, how to start, which template to use, how to pass on to the next team member and how to follow up.
2- Creating a common terminology where everyone uses the same word to mean the same thing.
3- Creating templates and IDs to avoid misunderstanding issues.
4- Establishing a performance evaluation method.
5- Introducing an automated process for the teams involved to be notified upon every change. This was mainly to make sure that finance are informed of all updates and changes.

By making sure that all team members are able to communicate effectively, we were able in 9 months to reach 94% matching between finance and production although we started with a 50% match only.

Communication skills are critical for the success of any business. If you are unable to communicate effectively, you will not get anywhere. Even written communication has its rules to make sure you deliver your message clearly and properly.

A nice link that I came across is: http://www.communication-skills-4confidence.com/communication-skills-test.html
This is a Self-Assessment Exercise that tests your communication skills, try it out and check how good you are.

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