Will the market change forever?

Apparently the first green shoots are appearing in the UK: house prices are inching up, unemployment has peaked and the demand for talent is beginning to increase. But I have to say I haven't felt the uplift yet in organisational communications. I'm sure it will happen, but I suspect what will emerge is a leaner, more professional model where more of the key work is handled in-house. The impact on the food chain that feeds off the big organisations will be marked. I suspect many businesses will be fighting for survival. Strangely, I don't think that's a bad thing.

In the boom years, I noticed a new breed emerging in my specialism: internal communication. Many great managers moved into senior in-house IC roles. But what they were great at doing was managing. What it meant for me and people of my ilk was that we had a say in developing these organisations' communications strategies, and once the comms strategy was in place, these managers were content to outsource much of the delivery of that strategy to external partners. The demand on in-house folk grew which meant the function grew too - as did the amount of work pushed out into the food chain.

An awful lot of 'communication' happened in a lot of organisations - some great, some pretty dire....and a lot that really was 'nice to have' rather than necessary. Every new project had a team and a campaign around it; every little initiative fought for share of mind......and those of us on the delivery side did very well thank you very much.

The last 15 months has been very different. First the hatches were battened down and nothing happened. Then organisations realised they needed to communicate their way through the financial crisis and called on their in-house teams to up their game...but cut the cost.

The result has been a fundamental shake-out in internal communication. For the first time in a decade or more, in-house teams have been asked to 'do the do' rather than relying on external expertise to deliver the goods. The poor performers have been found out and moved out of key roles, while those we always knew were good have shone - taking on the end-to-end process from helping to shape the business strategy to feeding the media channels directly. Sure, external people have been involved, but fewer; and doing only the things that really can't be done by the in-house team. Frankly it's something I'm also seeing in IT, in HR, in fact across all the centralised functions.

Those teams who do have the skills have really proved their worth - and there's a direct correlation with the organisations who are riding out the recession best. Look at an organisation where employees are engaged; where the brand is secure; where the direction is well planned and where leadership is clear and you'll undoubtedly find some great internal communication. Meanwhile managers who've been content only to manage have found IC a very tough place, and many have left their organisations.

The interesting part is that some have joined the ranks of agencies, consultants, micro-businesses and freelancers battling for an overall smaller pot of good IC work. As a pool of talent we're currently swollen. The high quality performers are there, but there are a lot of 'me too' practitioners around as well. And with a squeeze on budgets from within our client organisations, coupled with many new entrants prepared to work for less, there's a growing tendency for clients to commission solely on price rather than insisting on the right fit/best quality/optimal solution that we were getting to back in 06/07.

In some ways (he says through gritted teeth), this isn't a bad thing. Some consultancies and agencies were certainly charging ridiculous rates a couple of years ago - there were similarities to the worst excesses of management consultancy days when consultancies were happy to sell us our own watches so we could tell the time. So a euphemistic 'price correction' is probably overdue. However, the squeeze is rippling through the food chain to a point where there's a real danger that 'low bidding' wars will pull down the standards across IC and lead to some very good practitioners moving out of organisational communication, and some very poor work being delivered. This threatens to damage the already fragile reputation IC has built up in recent years.

Actually, I'm already seeing some move back in-house when the opportunities arise. There is a demand for highly skilled senior practitioners who can talk to the top team in their language and deliver the goods in a way that's truly engaging to their stakeholders. But I'm also seeing long-standing independents moving on completely - I now know a teacher, a trainee lawyer and a property developer who were all very solid IC pros less than two years ago.

So what kind of market will we see in 2010 and 2011? Increasingly, in-house teams will be more senior, better skilled but also leaner. They'll have to get to grips with Web 2.0 and release their tight grip on 'owning' communication since the emerging tools will democratise communication across organisations more than ever before. There will be a greater need for compliance driven from the centre, but also a greater need to really upskill line management to be communication leaders. We've all talked about it for a long time. Now it must happen.

Where in-house teams are staffed by skilled practitioners, they simply won't be allowed to grow big budgets any more. So there will be a greater focus on identifying what will drive the organisation forward and building communication into those drivers . A lot of the unnecessary stuff has disappeared already. It won't be back for a while.

There will still be a demand for external services, but it will be more focused on specific skills (social media; line management coaching; the comms end of cloud computing are just three areas where externals should be sharpening their skills) with less general demand for the extra pairs of hands. As external suppliers, we'll also have to deal increasingly with Procurement teams rather than the direct client. Initially this may drive down cost further, but longer-term should actually up the game for supplier who will have to justify costs through the value we create much more comprehensively.

A world-wide financial crisis has placed IC centre stage: a key resource for helping to ride out the storm. As a function, IC has been battered too, though the harshest effects have probably been on suppliers who've become too dependent on the bigger organisations for too long.

We'll never return to pre-2008 days, and if externals want to thrive in the upturn, we need to be as lean, as focused and as able to identify and deliver value as any of the upskilled internal teams we'll be supporting. It's going to be positively Darwinian out there.