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Small Business HR: How to Communicate With Employees Better

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Read Time: 12 mins
This post is part of a series called The Complete Small Business Human Resources (HR) Guide.
How to Make a Great Employee Training Plan (For Small Business)
What Are the Important HR Requirements for Small Business?

In the business world, communication is a common problem. In a survey by training company Fierce Inc., 86% of respondents blamed lack of collaboration or ineffective communication for workplace failures.

The communication problem becomes greater as a company grows and takes on more employees, but even small businesses can run into issues. When you just have one or two employees, you can probably just keep things simple and informal, but as you take on more staff and start to organize the company into groups with a management structure, you’ll need to pay serious attention to how you communicate with your employees—and how they communicate with you and with each other.

In this tutorial, we look at how to communicate effectively with employees. We cover strategies for keeping everyone informed, ways of communicating the firm’s key values, and methods of seeking feedback and resolving conflict. 

We also look at some real-world examples of along the way to illustrate important points. By the end of the tutorial, you’ll have some solid pointers for improving employee communication in your small business.

Are you communicating well with your small business employeesAre you communicating well with your small business employeesAre you communicating well with your small business employees
Are you communicating well with your small business employees? (photo source)

This is part of our series on small business HR. Follow along for advice on hiring and retaining the best talent, offering competitive pay and benefits, building a diverse and inclusive company culture, and more.

1. Keeping Everyone Informed

When you’re just starting out, keeping everyone on the same page is easy. But once you start growing and having numerous teams, perhaps based in different locations, it becomes a real challenge to keep all employees informed about what's going on in other areas of the business.

Even in small companies, departments can solidify into "silos", with little communication between them. This section looks at some ways to break down the barriers and keep information flowing around the company.

The Good Old Employee Newsletter

Probably the simplest way to keep everyone informed is to send out email updates. It’s a popular tool—a Ragan survey found that 60% of companies send out email newsletters at least once a week, and 14% even send daily emails.

The advantage is that it’s an easy and reliable way of reaching everyone within the company, and it’s also simple to create email lists for certain groups of employees if you want to segment things. People constantly check their email, so it’s likely that your messages will be read, and you can easily use software to track the levels of engagement (open rates, click-through rates, etc.).

On the other hand, mass email is quite a top-down method of communication that’s unlikely to foster interesting conversations in the way that some of the other tools do. People can only reply individually to you—or they can hit the dreaded “Reply All”, which can quickly spawn unwieldy, inbox-clogging threads if people take it too far. That leads on to another problem with email—the same Ragan survey found that 80% of people complained of email overload. Using email only adds to the problem, and there’s a chance your employees will just tune the messages out.

To use email effectively, try to make it engaging and fun, with some clear payoff for people reading it—perhaps a freebie, a useful resource, or information they can really use in their jobs. Keep it visual too—consider using a professionally designed email newsletter template

Intranet Tools

Company intranets have been around for years, and unfortunately many of them become seldom-visited graveyards of outdated policy documents and unread corporate blogs.

But it doesn’t have to be this way. If you design it right and make it engaging enough, an intranet can be a great way to spark conversations. The key is to make it easy for people to post their own comments and articles and to encourage usage at first, so that it builds critical mass. If people see interesting conversations taking place, they’ll make it a place they visit every day. If they see stale, top-down content, they’ll bookmark it and rarely return.

Software firm Dex Media, for example, created an intranet called The Buzz, on which it’s easy to comment and ask questions. Their VP of Corporate Communications told Interact Intranet:

“Now, employees across the business have a voice and a place where they can share their ideas and opinions… People are setting up team and project sites, commenting on posts and asking questions, and we are developing a more contemporary, entrepreneurial, forward-looking business culture as a result.”

Cloud Software and Chat Technology

If you don’t want to invest in building an intranet, you can achieve a similar effect with cloud software and chat technology. 

Here at Envato Tuts+, for example, we have a team spread all over the world, from Florida to Thailand. We use Slack for informal conversations grouped by topics and interests, and web-based applications like Trello and Basecamp for more formal projects and collaboration. And people also use Google Docs and other cloud-based offerings to share information easily.

There are plenty of other options, of course, so it’s just a matter of finding what works for your business and encourages communication. Check out this curated roundup for more possibilities:

Documentation and Training

Face-to-face meetings and training can also help people stay up to date. You can schedule training sessions for an employee from one area to brief those in another. For example, a salesperson can hold a training session for those in a product management role, telling them about the feedback they get from potential customers and the trends they see in the industry. That perspective could be valuable to those with less direct customer contact, and could contribute to more successful product development.

Having solid documentation of company policies is another important communication tool—it can help employees know how to get things done without having to waste time asking around. An employee handbook is a great tool for this. We’ve got tutorials on training and on employee handbooks elsewhere in this series:

2. Communicating the Company's Values

Every successful company has its own values and goals. Whether you’ve articulated them clearly or not, they exist—your company exists for a particular purpose (beyond just making money!), and you have a certain way of doing business that’s distinct from others.

It's important for all employees to be on the same page regarding the company’s values and mission, but this can easily get lost in the day-to-day work life—especially when you start to grow.

If you want to communicate your values effectively and authentically, of course you’ll first need to be clear about them. If you need help on that, see the following tutorials:

Then begins the process of what this excellent Harvard Business Review article calls “selling the brand inside”.

What I like about this formulation is that it encourages entrepreneurs to approach employee communications in the same way that they approach external marketing. The goals, after all, are similar with both employees and customers: to promote a positive view of the company brand and achieve higher levels of engagement and loyalty.

Business owners often take such engagement and loyalty for granted with their employees, or perhaps they believe that it should come automatically in return for providing a paycheck, but that’s simply not the case. Survey after survey shows that large sections of the workforce are disengaged from their jobs and planning to leave. With employees, just as with customers, engagement and loyalty have to be earned.

The HBR article includes some great examples of how companies have done that. They’re mostly based on large companies, but small businesses could do similar things, so I’d recommend reading it to get some ideas. 

For example, some executives at Nike were given the title of “Corporate Storyteller” and encouraged to tell stories that illustrate the firm’s key value of Just Do It:

“Nike cofounder Bill Bowerman, in an effort to build a better shoe for his team, poured rubber into the family waffle iron, giving birth to the prototype of Nike’s famous Waffle Sole. By talking about such inventive moves, the company hopes to keep the spirit of innovation that characterizes its ad campaigns alive and well within the company.”

Of course, the best way to reinforce company values is not to talk about them but to live them. The article also cites Minnesota-based Quality Bicycle Products, which is committed to protecting the environment. Employees who live within ten miles of the company are given a $2 daily credit for cycling, carpooling, or taking a bus to work. That’s values in action.

3. Seeking Feedback

Communication is a two-way street. As well as communicating to your employees, you need to encourage them to communicate with you, both about how they feel in their job and about important information or ideas about the business.

Using some of the strategies we’ve just mentioned, such as collaborative software and chat tools, will help to some degree. But even in small companies, people can be afraid to speak their mind on sensitive issues in public forums or in front of the boss.

Run Effective Employee Surveys

So regular employee surveys are a must. It’s best to get an external consultant to conduct the surveys, for two reasons:

  1. For the data to be meaningful, you have to ask the right questions in the right ways and analyze the results properly, so it’s good to get help from someone with experience running surveys.
  2. The whole point is to get employees’ honest, unvarnished opinions, so it’s important to establish trust that their responses will be anonymous.

With a small business with few employees, you may have to go to extra lengths to ensure that people still can’t be identified. A consultant can help with that. Also consider tying the results to some benchmark, such as an external organization like Great Place to Work. That can help you see where you’re doing well and where you need to work harder. Surveying regularly and maintaining consistency in the questions asked can also help you spot trends over time.

Informal Meetings

As a small business owner, there’s no excuse for not meeting regularly with your employees. Even Facebook CEO Mark Zuckerberg regularly meets with entry-level employees in so-called “Zuck Reviews”.

Even better than a formal review, though, is an informal meeting. Zuckerberg is a fan of walking meetings, along with other tech luminaries like Steve Jobs and Jack Dorsey. People can often loosen up and feel free to speak their minds when they’re walking in the open air rather than sitting across a desk or around a conference table.

So, although you’re busy, schedule some time with each employee as often as you can. Although we’ve talked about some larger-scale technological solutions, a simple face-to-face chat can often be the most effective form of communication. It may seem stilted at first, but if you do it regularly, you’ll be able to build a level of trust that will encourage employees to open up with you and speak freely.

4. Resolving Conflict

In a large company, an important function of the HR department is to resolve conflicts between employees and deal with complaints. If an employee feels unfairly treated, or if two staff members just can’t resolve their differences, they’ll need an appropriate avenue for having the issue resolved.

As a small business owner, those things may well end up being your responsibility, so here's a look at some best practices:

First, you need to have a plan. Conflict will arise from time to time in any organization, even if the workplace culture is generally healthy, so you need to have a method of dealing with it. If your firm is too small to have an HR representative, then you may have to step in, but also look around the company to identify other people who may have the skills to act as effective mediators.

Then establish a conflict resolution process. The following checklist from the Human Resources department at the University of California, Berkeley, provides an excellent starting point:

  1. Acknowledge that a difficult situation exists.
  2. Let individuals express their feelings.
  3. Define the problem.
  4. Determine underlying needs.
  5. Find common areas of agreement, no matter how small.
  6. Find solutions to satisfy needs.
  7. Determine follow-up you will take to monitor actions.
  8. Determine what you'll do if the conflict goes unresolved.

Try to encourage healthy communication patterns by asking people to keep personalities and emotions out of it and try to describe the issues and consequences objectively, without making accusations.

Conflict can be difficult to deal with, both for those involved and for those trying to mediate. But, if unresolved, it can lead to accumulated resentments and a poisoned work environment. 

See the Berkeley article for more details, as well as this post on using the oddly named but powerful “giraffe language” to defuse conflict. If things get so bad that you feel you can’t deal with it, or if the situation demands a level of impartiality that you can’t provide, consider bringing in an external mediator or arbiter.


In this tutorial, you've learned about ways to improve employee communication in your small business. You’ve seen some examples from successful businesses and learned about some techniques you can use in your business today.

Whether you end up relying on software tools, surveys, newsletters, face-to-face meetings or a combination of all of them, you can put your own stamp on them and create some best practices of your own. After all, communication is best when it’s authentic, so do what feels authentic to you. 

Next up in this series on small business HR is a look at some of the important HR requirements for small businesses. Then we’ll look at other topics such as the worst HR issues and the best HR software solutions. So stay tuned!

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