CLEAR wins

What Poor Communication Really Costs Your Business

Your team just spent another hour in a meeting trying to figure out what “increase engagement” actually means. Sound familiar?

While you were in that meeting, poor communication was quietly draining your organization’s resources. How much? According to recent research, the answer might shock you.

Written by Matt Roberts | Project Principle, ZOKRI

The Trillion-Dollar Elephant in the Room

Poor communication isn’t just frustrating; it’s devastatingly expensive. Grammarly’s 2025 State of Business Communication report revealed that ineffective communication costs U.S. businesses up to $1.2 trillion annually.¹

Let that sink in. That’s more than the GDP of many countries, lost to misunderstandings, unclear directives, and fuzzy objectives.

But what does this mean for your organization specifically?

“The biggest cost in business isn’t failure—it’s miscommunication.”

The Price Tag on Confusion

The numbers tell a stark story about what happens when clarity takes a backseat:

Per-Employee Costs
Research from Axios HQ found that ineffective communication costs between $10,000 and $55,000 per employee per year, depending on their salary level². For a company with 100 employees, that’s potentially $5.5 million annually disappearing into the void of miscommunication.

Company-Wide Impact
The Society for Human Resource Management’s research painted an even clearer picture:

Small companies (~100 employees): $420,000 per year
Large companies (~100,000 employees): $62.4 million per year³.

These aren’t rounding errors. They’re budget-breaking losses that could be funding innovation, growth, or employee development instead.

Where Does the Time Go?

Perhaps most tangible is the time tax. Research from Vantage Partners found that poor communication wastes 7.47 hours per week per worker⁴. That’s nearly an entire workday, every single week, spent clarifying, correcting, and course-correcting.

Think about it.

That’s 20% of your team’s productivity evaporating because someone said “improve customer experience” without defining what “improve” means or which aspects of the experience matter most.

“Poor communication doesn’t show up on the balance sheet—but it’s costing you a full day of work, every week, from every employee. Clarity isn’t a luxury—it’s a multiplier.”

The Human Cost: More Than Numbers

Beyond the financial impact, poor communication creates a workplace culture of frustration and burnout:

When people don’t understand what’s expected of them, they don’t just work less efficiently. They work anxiously, second-guessing every decision and dreading every check-in.

The Ripple Effect: Losing Customers and Talent

The damage doesn’t stop at your office walls. Poor internal communication infected external relationships:

“What starts as confusion inside your company ends as disappointment outside it. Every missed word becomes a missed opportunity.”

Your vague internal objectives become your customers’ poor experiences. Your fuzzy strategies become your competitors’ opportunities.

The Strategy-Execution Gap

MIT Sloan’s Donald Sull identified a critical insight: Organizations often split strategy formulation from execution, creating a gap where miscommunication thrives. When strategies are crafted in boardrooms using abstract language, then handed down for execution, every level of translation introduces potential for misalignment.

This is where operative phrases like “world-class,” “seamless,” and “best-in-class” become particularly dangerous. Without precision, each team interprets these words differently, leading to the scattered efforts and wasted resources the research quantifies.

Complete, Language, that Engergizes, is Actionable & Realistic (CLEAR) - The Antidote to Ambiguity

This is why our OKR coaching emphasizes clear, specific, actionable, and energising language – words and phrases that have precise, measurable meaning in your specific context. The great use of language isn’t about dumbing down communication; it’s about elevating it to a level where everyone shares the same understanding.

What Makes Language pass the”CLEAR” test in OKRs?

CLEAR language in OKRs means:

Even words we think are clear often aren’t. As communicators crafting OKRs and strategic messages, we must consider what we’re truly trying to achieve:

When you want people to “comprehend” your message:

When you want your message to “resonate”:

When you want to “influence” outcomes:

These aren’t just semantic distinctions. They’re the difference between teams nodding in meetings and teams delivering results. The $1.2 trillion cost of poor communication happens when we assume others interpret our intent correctly. Clean language requires us to make that intent explicit.

From Vague to Valuable: The Path Forward

The research is clear: Communication precision isn’t a nice-to-have. It’s a business imperative. Companies with leaders who possess effective communication skills produced a 47% higher return to shareholders over a five-year period.

This is exactly why our OKR methodology focuses relentlessly on unpacking operative phrases and establishing clean language. Every fuzzy word is a leak in your organizational effectiveness.

“Every fuzzy word is a silent cost. Precision in language isn’t just clarity—it’s competitive advantage.”

Our Language Approach in Action

When we work with teams on OKRs, we apply these principles:

1. Identify Key Phrases - those seemingly strategic words that hide ambiguity
2. Define them Measurably - with specific metrics, benchmarks, and boundaries
3. Write Context Explainers - documenting why this measure, why this target, how it connects to strategy
4. Create Objective Narratives - explaining the why, the priorities, and the crux of what matters
5. Cascade precision - ensuring every level uses the same definitions

For example, when a client says they want to “influence stakeholders,” we unpack it:

The Bottom Line

Every fuzzy objective, every vague directive, every unclear expectation is a withdrawal from your organization’s success. The research proves what we’ve all experienced: When communication fails, everything else follows.

The good news? This is entirely fixable. Unlike market conditions or competitor actions, communication clarity is completely within your control. Every operative phrase you unpack, every objective you clarify, every context you provide is money saved, time reclaimed, and stress eliminated.

The path from that $1.2 trillion loss to organizational clarity runs through clean language. It requires discipline to define what “comprehend” means in your context, precision to specify what “resonate” looks like in practice, and rigor to measure how you’ll know when you’ve truly “influenced” outcomes.

Start today. Take your most important current objective. Find the vague words – even the ones that seem clear. Define them precisely. Share that precision. Watch what happens when everyone knows exactly what success looks like.

Because in a world where poor communication costs $1.2 trillion, clean language isn’t just good practice. It’s your competitive advantage.

Sources

Grammarly/Harris Poll 2025: “State of Business Communication: The Backbone of Business Is Broken” – via Agility PR Solutions, April 2025
Axios HQ 2025: Employee survey on communication costs – via Pumble Workplace Communication Statistics, 2025
SHRM (Society for Human Resource Management): Via Text-Em-All blog, “The Hidden Costs of Poor Communication in the Workplace,” April 2024
Vantage Partners 2022: “Top 5 Costs of Poor Communication Skills in the World of Hybrid Work,” October 2022
Project.co Communication Statistics 2025: Via Pumble and Highrise
HRVisionEvent 2024: “The Signs and Costs of Poor Communication in the Workplace,” November 2024
Economist Intelligence Unit: Via HRVisionEvent 2024
MIT Sloan Management Review: “Closing the Gap Between Strategy and Execution” by Donald N. Sull
Holmes Report: Via Inc.com article by Michael Schneider, January 2021

Ready To Transform Your Fuzzy Objectives Into Clear, Actionable OKRs?

Our methodology helps teams unpack every operative phrase, define precise success criteria, and create the shared understanding that drives results. The research shows the cost of ambiguity. Now it’s time to capture the value of clarity.