Socializing Through Effective Communication in CAPCO

Mohd.Nasrul Hakim Sallehudin, Safiah Edina Noorizan, Nurasirah Ramlan

Universiti Sains Islam Malaysia (USIM)

ABSTRACT
This case study discusses about how the concept of organizational structure that is
implemented by CAPCO (flat organizational) and by using elements of human
resource development can bring to effective communication. CAPCO is a leading
international provider of consulting, managed services and technology solutions for
the financial services industry. By using the secondary data, this paper will take you
to understand the journey of CAPCO in creating the effective communication in their
organization by using their human resource development tools that are, training,
recruitment, matrix structure team and professional development.
Keywords: effective communication, organizational structure, matrix structure team
and training.
INTRODUCTION
WHAT IS EFFECTIVE COMMUNICATION?
Effective communication can help an individual or organization to better
understand a person or situation that enables them to resolve a different opinion in
a group of people or organization, build trust and respect, and create an
environment where creative ideas, problem solving, affection, and caring can
flourish. Effective communication can improve relationships at home, work, and in
social situations by deepening an individual or organization connected to others and
improving teamwork, decision-making, and problem solving. It enables a person to
communicate even negative or difficult messages without creating conflict or
destroying trust (Deepti Mishra and Alok Mishra, 2009).

Effective communication can lead to understanding in an organization. Although

effective communication is important, it is not the main objective. According to Mark
Sanborn (2006), a bestselling author and noted authority on leadership and team
building, the objective is to achieve understanding. Sanborn believes that the word
communication is an amorphous term that is not adequately understood. As an
organization, the main goal is to foster understanding, and the primary tool to
achieve understanding is effective communication. Effective communication allows
participants to properly exchange ideas, opinion, views and to helps achieve the
desired outcomes in creating and maintaining learning for the employee and the
organization.

EFFECTIVE COMMUNICATION IN AN ORGANIZATIONAL AND WHY IT IS

MATTER.
Organizational communication is a key element of the organizational climate. It
applies to all the phases of management in the organization. It is the central binding
force that permits coordination amongst the organizational people and thus allows
for their organized behavior. In fact, the behavior of the people in the organizations
is best understood from the way they communicate.
It is very necessary for the effective organizational performance. Effective
communication is also essential for the coordination between material and human
elements of the organization. In the absence of such effective communication, the
smooth functioning of the organization gets jeopardized. The most efficient
management is that which understands the values of communication and use it
effectively in the environment of the organization.
Effective communication is necessary for the organization since the management
functions of the organization are carried out through communication. In fact,
effective

management in the organization is directly related to the effective

organizational communication.
Effective communication in the organization is also necessary to address other
organizational aspects such as innovation, organizational learning, knowledge

management, conflict management, diversity, and communication technologies.

The importance of communication in the organization is because of the following.

Work being carried out is complex in nature and requires greater coordination
and interaction among workers.

The speed of work being carried out is quite fast.

Workmen are distributed in very wide areas in the organization.

Simultaneous, distributed work processes are more common.

Knowledge and innovation are very critical for the competitive advantage of
the organization.

Communication technologies and networks are increasingly essential to the

structure and strategy of the organization.

According to Fred T. Allen, the chairman and president of Pitney Bowes, believe that
the better informed employees are, the better employees they will be. Therefore,
communication is essential to an organization. Information is vital to effective
communication. The Person who control information control power. (Gerald M.
Goldhaber, 1990)
This is because the production processes of today emphasize greater collaboration
and teamwork among employees in different functional groups. Further the rapid
advancement in the communication technologies has also contributed to the
transformation of both work and organizational structure.
Communication is defined as the exchange of ideas, messages, or information by
speech, signals, or writing. The basic function of communication is to affect receiver
knowledge or behavior by informing, directing, regulating, socializing, and
persuading.
Communication is an important tool for the development of an organization. It is
critical to effective management. It is something which helps the management to
perform the basic functions of managing the organization such as leading, planning,

organizing, motivating, and controlling. The primary functions of organizational

communication are identified as the following.

Compliance-gaining

Leading, motivating, and influencing

Sense-making

Problem-solving and decision-making

Conflict management, negotiating, and bargaining

Coordination and regulation of production activities

All the essential information must be communicated to the managers who in-turn
must communicate the plans so as to implement them. Organizing also requires
effective communication with others about their job task. Similarly, leaders as
managers must communicate effectively with their subordinates so as to achieve
the team goals. Controlling is not possible without written and oral communication.
Communication helps achieve the desired outcomes for the employee and the
organization in a variety of ways.
Faulty communication in the organization can lead to the lowered efficiency and
effectiveness of the organization as well as at the individual levels. Also, it may
become a cause of the interpersonal friction between the employees.
Communication in the organization can be formal and informal communications. It
can be inside the organization (internal communication) and can be outside the
organization (external communication). Internal communication is a process where
all employees take part unlike external communication where only some employees
take part. Internal organizational communication practices include newsletters,
presentations, strategic communications, work direction, performance reviews,
meetings and more while the external communications are directed to the public,
customers, suppliers, media, and other stakeholders. External communications can
also be inter-organizational.

Communication can also be characterized as vertical, horizontal (lateral), or

diagonal.

Initially

greater emphasis

was

directed

at

vertical

organizational

communication as compared to horizontal communication, but that is no longer the

case. Diagonal communication is an even more recent phenomenon in the
organizational

communication.

Vertical

communication

can

be

downward

communication or upward communication.

Downward

communication

communication

from

the

also

known

as

management

top-down

to

the

communication

employees.

This

is
form

the
of

communication is used for conveying organizational vision, objectives, policies,

plans and targets. This form of communication can increase utilization of specific
programs by making employees aware of the availability of the programs, clearly
explaining

how to access and use the

services,

and

demonstrating

that

management supports and values the programs.

Upward

communication

also

known

as

bottom-up

communication

is

the

communication from the employees to the management. It provides information

about employee needs, values, perceptions and opinions to the management. This
helps the organization to select and tailor its programs and policies to meet the
specific needs of their employees.
The most important role of organizational communications is relationship building.
Relationship building provides a strong basis in case of crisis management and help
in the change management in the organization. (Randolph T. Barker and Martin R.
Camarata, October 1998)
Effective communication is very important for the creation of a successful
organization. Bad communication between managers and employees results in
conflicts inside the organization which leads to moral decline and its fallout effects.
Effective management raises the

moral of the employees. It stimulates the

creativity in the employees and they are motivated to make a contribution to the
strategic goals of the organization.
"Many of the problems that occur in an organization are the direct result of people
failing to communicate or communicating ineffectively"

(SANS Leadership And Management Competency,

page 136)

EFFECTIVE COMMUNICATION IN THE CAPCO

Capco has already executed the use of the effective communication in the
organization to further develop the company management and then organizational
development. In the companys organizational structure instead of uses the
hierarchical structure that has many layers and a long chain of command from the
top to the bottom layer, Capco uses a flat organizational structure, which it has a
few layers of management. In this situation of

organizational structure the

command from top to bottom will be short and the span of control is wide, by using
this structure of organizational the communication among the team leadership and
the employees can be clear an effective.
The structure of a flat organizational uses a team based project, also known as
matrix structure. This matrix structure is a method to build a cross-functional team,
where every single person on the team was from a different field of the business
that were combined together. This structure was highly motivated and empowered
workforce with everyone, the employee have access to advice and coaching and
using a bottom up leadership approach where employees are able to ask questions
and give a suggestion for improvements to the high company management team, it
is said that all have open access.
Capco really focuses on an open and effective communication in their organization
to flourish ideas, sharing, innovation, creativity and promoting a new way of
thinking. Capco believes in open lines of communication and its structure and
culture has created honest channels of communication.
Elaine Crowe is a Relocation Manager for the Rank Group; a European gaming and
leisure group and the Chair of the UK Relocation Users Group, shared:
Honest communication is a vital ingredient in creating a long lasting professional
relationship. It should allow each partner to meet expectations and together obtain
a united framework for every move, regardless of the different relocation
requirements. There are often lots of buzz words to describe the basics, but as they

always remain the same; conscientious, caring, cooperation, clear and concise
communication. (Dominic Tidey, 2004)
The employees of Capco were encouraged to share their entrepreneurial ideas to
the leadership team of Capco through its local and regional forum event to
disseminate information about the development in the business, as well as giving
employees an opportunity to socialize. One of the examples, where the story, one of
the Capcos employees shared his idea to develop an internal social networking site
called CapInTouch for Capcos employee to communicate remotely on a client site
Within Capco, they used Rocket Method to

generate ideas in a Rocket Team.

Rocket team was the name of a method for a team working, communication and
create decision-making. There will be several Rocket teams that will develop ideas
to solve a certain client problem given to them, then they will share among the
teams, what are their ideas and the best solution idea will be getting for this
method of ideas generation and sharing. This is how the Capco create an effective
communication among the employees and employees to the upper leadership
team, it will be discussed further in this case analysis.

HYPOTHESIS
The hypotheses are shown in the following figure

Organizational
Structure

Recruitment

Training

Matrix
Structure

Professional
Development

Effective
Communication

H1: Recruitment in CAPCO positively affects the effective communication in the

organization structure of CAPCO.
H2: Training in CAPCO positively affects the effective communication in the
organization structure of CAPCO.
H3: Matrix structure team in CAPCO positively affects the effective communication
in the organization structure of CAPCO.
H4:

Professional

development

in

CAPCO

positively

affects

the

effective

communication in the organization structure of CAPCO.

METHODOLOGY
In order to examine the effective communication in organizations, a content
analysis of data and articles regarding elements in the effective communication
need analysis were carried out. All these documents were extracted from various
resources such as journal, articles, data from the companys website and later were
analyzed.

By systematically evaluating text (documents, oral communication and graphics.) a

case study research strategy was used to study the research topic (Yin, 2009). This
case illustrates the concept of organizational structure that is implemented by
CAPCO (flat organizational) and by using elements of human resource development
which brings to effective communication to the company. Primary data were not
gained because we are unable to held an interview with CAPCO representatives, but
with the secondary data collected, we analyse it using the five-phase cycle
proposed by Yin (2011) : 1) compiling, 2) disassembling, 3) reassembling (and
arraying), 4) interpreting and 5) concluding. When concluding the case, lesson
learned from the CAPCO quote the unique experience which can be the example for
others (Yin, 2009).
ANALYSIS
As what have been discussed earlier, an effective communication can help an
individual or organization to better understand a person or situation that enables
them to resolve a different opinion in a group of people or organization, build trust
and respect, and create environments where creative ideas, problem solving,
affection, and caring can flourish. So now, we will analyze how the training that is
used in CAPCO can influence the effective communication. But first, let go through
the training that have been applied by CAPCO.
Talent Identification Management
CAPCO uses Associate Talent Programme (ATP) to attract new comers in this
financial services field to get involved with skill and experiences they need today.
LinkedIn works as the intermediaries for to promote and communicate with the
other organization about the benefits of ATP. Basically, after the applicant joined the
ATP; this new associates will take an intensive training course which is involving
working in a simulated project environment. This course will give an introduction of
the global financial services landscape, current risks and regulations and
foundations of consulting and project delivery. This show how CAPCO used social
media to communicate externally.
We want to attract, nurture and retain the best talent,by encouraging
creativity, innovation and expertise

-Rob Heyvaert, CEO & Founder of CAPCO

Training and Development

CAPCO had applied a high value on consulting, management and interpersonal
skills, and industry expertise as their cultural of learning. CAPCO offers an eLearning
and classroom training opportunities. This eLearning covers both financial services
and management consulting and even focus on developing managerial and
interpersonal skills as well as technical and industry-related expertise.
Each individual is charting their own growth, and CAPCO offers a variety of
educational resources and learning maps to facilitate career development. This
mentoring and coaching session range from instructor-led classes was conducted by
seasoned or senior workers of CAPCO professionals with specialized industry
experience to state-of the-art eLearning resources available on demand every day.
CAPCO also had their own comprehensive eLearning course catalog has more than
4,000 modules designed to educate and stimulate employees at each stage of their
career, supporting ongoing personal and career development. Employees can also
download training and development books to read at their convenience. As a global
firm, CAPCO also dedicated to cross-cultural communication and knowledge transfer
and provide numerous educational opportunities to expose our employees to
international issues or globally.
There is no doubt that recruiting the right employees can be challenging, but the
rewards of a well-constructed strategy are. From what can we see, hiring talented
individuals is critical to an organizations success. But in order to hire the most
talented, you must first recruit them. Recruiting employees can be a challenging
task. If not done correctly, an organizations recruitment effort can produce job
applicants who are unqualified, who lack diversity or who may decline job offers.
These same applicants may be prone to turnover if hired.

Enormous, because effective recruiting is the foundation upon which any talent
management program is built. This report has presented a model of the ideal
recruitment process based on academic research and practitioner reports, and
recommendations for conducting an effective recruitment campaign. To get
1 Recruiting and Talent, A SHRM modul (2004)

maximum benefit from these recommendations, you should customize them to fit
your organizations unique situation. 2
Traditional Recruitment and Online Recruitment
Doing traditional recruitment is one of hardest matter in Human Resources
Management. It includes different step start from fill in forms until training. It might
incur cost and time. However, this traditional recruitment will make organization
assured to recruit employee as employer believes in their credibility as they has
gone through many stages in order to be recruited in the company. Different from
CAPCO, they have an Associates Talent Program (ATP) which is they used social
media called LinkedIn to promote this program to attract applicants. Even though
CAPCOs new associates undertake an intensive training, but they will only attach to
training in class, but they do not have assessment after training and it might make
applicants forget what they learned.
When analyzing on training and recruitment, we found out that the best way to
implement it is by using effective communication between the employee. Therefore,
we can say that CAPCO is using the right and good strategy in emphasizing
effective communication in its organization.
CAPCO is applying a unique organizational structure in its organization. As has been
mentioned in the introduction,CAPCO is implementing a flat organization structure
in

their

management.

organization or delayering)
structure with

few

or

no

A flat

is

an

levels

organization (also
organization
of

that

known

as horizontal

has

an organizational

middle management

between staff and

executives. The flat organizational structure is an opposite structure from

hierarchical organizational structure because it has less layers or chains from top to
bottom of the organization. With this less layer from top to bottom it will create
lesser boundaries between the employees and the top management and the
information can be informed clearly and effective. This kind of structure also has a
short chain and broad span of control.

2 Recruiting and Talent, A SHRM modul (2004)

We support and encourage an entrepreneurial outlook and independent thinking.

CAPCO is not

about organizational charts and layers-we operate with little

hierarchy because we want all

employees to feel that CAPCO IS their firm to own

and run. - CAPCO

The Rocket Team in CAPCO

The rocket team (refer to appendix 1) is the result of the CAPCO applying matrix
structure in its management. This group contains 3 to 4 employees from different
department and different skills such as marketing, human resource, IT then this
group will be given a task to think the best solution for problem that certain
customer is facing by combining their skill, knowledge, experience and ideas.
Working in Rocket Team, it very emphasizes the teamwork, which means different
people with different skill, knowledge and experience working together as a team to
come out the creative ideas and creative solution.it is a small team with 3 to 4
people. This help to quickly establish trust among the team. 3 Other way fot this
team to communicate is by using the CapInTouch 4 that is CAPCOs internal social
networking site that can used by all of the CAPCOs employees around the world to
communicate and discuss with each other by sharing the progress of the project
and also asking some suggestion about certain solution for the customer problem
from different team that handle different project not just within their other
organization only, but also with other CAPCO organization around the world.
Is now an internal community-based tool available to all CAPCO employees. The
global

social networking site has revolution the way people communicate

across the

organization.

- CAPCO

Small team are more effective in coordination, communication and collaboration

than large team (cockBurn,200);Curtis,Curtis, & Iscoe,1988). The most effective
3 ArticleOrganizational Structure In An Innovative Environment.
4 ArticleOrganizational Structure In An Innovative Environment.

form of communication (for transforming ideas)is interactive and face-to-face.

(Cockburn,2000)

. Face-to-face are more flexible and can respond better to

ambiguity and uncertainty ( Allen 1971).

Resulting In Professional Development
The Rocket Team concept that applied in CAPCOS management can influence and
helping the development of professionalism or the personal growth of the
employees from time to time. By working with the different people that have
different skills and experience, this is somehow helps in developing the new
experience and also new skills of the employees. Based on the result from the
survey that have been done toward the CAPCOS employees, 85% of the employees
stated that they are happy with their personal growth 5. Each of the employees is
also assigned with a career development coach who provides personal ongoing
career guidance.
The size of CAPCO offers our employees unlimited access to senior management.
All

employees

guidance

are assigned a coach, an experienced consultant who offers

as employees progress in their careers at CAPCO. - CAPCO

The 4 key of pillars of CAPCO foundation of culture:

1- Opportunity: personal growth opportunities in a fast-growing entrepreneurial
firm dedicated to financial services
2- Performance

and

reward:

true

meritocracy

where

performance

is

recognized and rewarded

3- Work: a challenging portfolio of work that will use and stretch our employees
skills, tackling complex business issues
4- Experience and learning: learning from and sharing insight with thought
leaders of unparalleled experience;
CAPCO is very helpful in helping to broaden the skills, knowledge and experience
beside give the opportunity for the employees personal growth and also rewarded
5 ArticleOrganizational Structure In An Innovative Environment.

the employees that give the best effort and performance. The result of all this
investment and also as a compliment towards the employees can lead to the
development in company management whereby more experienced and skillful
people will take the lead in this company and coaching and mentoring the new lead
or the newcomers in the company.
The other way of CAPCO gives apply the professional development towards its
employee by the forum.The CAPCOs local and regional offices will host the regular
forum to disseminate information about the development in the business. With this
also CAPCO give the opportunity to its employees to communicate and socialize
with each other. This opportunity to communicate with each other combining with
the uniqueness of its flat organization structure creates the larger opportunity for
the employees whereby the employees can put forward their entrepreneurial ideas
to the leadership team.
We can analyze working in the team actually is the best way of implementing the
effective communication between the employee. So, here we can say that CAPCO is
using the right and good strategy in emphasizing effective communication in its
organization.

Besides,

effective

communication

also

helps

in

developing

professional development
Explanation Figure 1
Salary and Reward
Flat Organization
Training and Development Program

EMPLOYE
R

EMPLOYE
ES

CUSTOME
RS

Profit and Trust

Integrated Marketing Communication

Project Based Team

Giving a good service

for

the Capco
Public Relation Event
Corporate Social Responsibility

The CAPCO communication chain

1) This figure tells about the movement of communication in CAPCO. It is among
CAPCO employer, employee and customer. CAPCO is a leading international
provider of consulting, managed services and technology solutions for the
financial services industry. CAPCO has been awarded by The Sunday Times.as
100th Best Company to Work for. This award proves that CAPCO is a good
company which always emphasizes their employee. CAPCO will provide
salary, training and reward to the employee.
Besides that, CAPCO is implementing flat organization to make their
employee easy to communicate with the employer if there any problem
occurs. While by implements matrix structure as cross functional teams to
encourage employees to work with a team which

come from different

division to work together and solve problems, with creative ideas. CAPCO also
leaves their employee to freely ask questions and suggest improvements,
they have all open access. Furthermore, they provide forums for their
employee to put forward their entrepreneurial ideas to the leadership team
and sometimes if a task is urgent then it is preferable to do small team or

even individual to undertake the task to ensure focus. This will lead employee
to have their own personal development.
The Sunday Times also stated that 87% said that CAPCO is good for personal
growth. CAPCO does training for their employees by using eLearning and
classroom training opportunity delivered by seasoned CAPCO professional.
CAPCO created an internal social networking site called CalpInTouch to solve
problem that faced by employees which is hard to keep in touch with other
staff, as working in different locations and projects.
2) From the site of the employer, CAPCO put a biggest trust and benefits to the
employee. In return for that, employee will provides good services to
customer as what satisfaction they have from the employer. But before that,
for whom who worked for CAPCO will relief because CAPCO implement Equal
Employment Policy.
The Company stands committed to its philosophy that all employees are entitled to
equal employment opportunities. This policy applies to all personnel actions,
including compensation, benefits, discipline, transfers, promotions, layoffs, leaves of
absence, terminations, and participation in Company-administered activities. The
Company also affirmatively recruits and hires individuals based upon demonstrated
abilities, achievements and experience, without regard to race, color, religion, age,
national origin or ancestry, sex, pregnancy, citizenship status, veteran status,
marital status, physical or mental disability, medical conditions, sexual orientation,
or any other consideration made unlawful by Federal, state or local laws.
Besides that, in order to provide good services to customer, employee will work in
teams called as a project based team. Basically, they will form a team and the
projects with the assistance of different department to provide excellent services.
The skills and experience and ability to think differently are important components
that CAPCO offers to clients. Idea generation for their clients developed through
CAPCOs

rocket

method

as

it

is

covering

all

aspects

of

team

working,

communication and team decision making. Working creatively together make

employee communicate together regarding what project they represent.

3) From customer sites, in return of satisfaction for CAPCOs services, customer

will repeat to the organization and this will lead to higher profitability to
CAPCO. This is simply because; customer will repeat purchases as they were
put high trust on CAPCO. They will support all events that will be organized by
CAPCO. CAPCO also will use Integrated Marketing Communication (IMC) in
order to build trust will customer such as connecting through social media,
such as Instagram and Facebook.

RESULTS
Base on the hypothesis and after analyzing the data using the content analysis of
secondary data such as journal, article and company website, we can prove that our
hypothesis about training in CAPCO positively affect the effective communication in
the organization structure of CAPCO is proved. Then the second hypothesis about
the recruitment in CAPCO positively affect the effective communication in the
organization structure CAPCO is also proved. Third hypothesis is about the matrix
structure team in CAPCO positively affects the effective communication in the
organization structure of CAPCO is proved and fourth hypothesis about professional
development in CAPCO positively affect the effective communication in the
organization structure of CAPCO is also proved.

CONCLUSION LESSON AND IMPLICATION

Recommendation to the CAPCO:
1) Apply assessments or examinations after classroom training for recruitment of
employees
This assessment or examination can help new associates to remember what they
learn in the training
Based on the above case, several lessons and implications could be highlighted:

1) Effective communication needs to be delivered effectively through several tools

that are believed by the organization; from top organization to the employee and
among the employees themselves.
2) Effective communication can bring a flourishing environment of the organization,
for employees share creative ideas; Create effective problem solving and decision
making.
As a whole, we are suggesting to next researcher, to emphasize more on the
difference between organization structure (flat structure and hierarchical structure)
in term of effective communication. We strongly believed that communication is
important for development of organization and empowering employees in term of
morality.

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APPENDIX
1. Rocket Team.