After Carly Fiorina was sacked last month as CEO of
Hewlett-Packard Co., a slew of stories (in print and online) said
Fiorina constantly made the rounds with H-P customers and other
external audiences. Yet closer to home, she lived inside a
bubble.
While other top H-P managers made a point of meeting regularly
with the rank-and-file - down to the lowest rung - Fiorina spent
too much time flying around in her corporate jet, visible only on
TV broadcasts of company meetings, according to the Washington
Post (Feb. 10). A lack of employee relations wasn't the sole
reason for Fiorina's ouster, of course, but it sure didn't help.
(Fiorina got a reported $21 million severance package, and she is
now in the running to take over The World Bank.)
Treated like a rock star early on in her six-year tenure,
Fiorina's firing provides a cautionary tale for CEOs and senior PR
execs. With increasing pressure from boardrooms - - not to mention
anyone with a computer modem who may have an axe to grind -- CEOs
need to have employees on their side because they are the first
line of defense against any attack. Perhaps more important,
employees now have more clout than ever.
"There's so much whistleblower legislation and opportunities for
employees to bring the CEO to his knees," says Tom Chema, president
of Hiram College in Cleveland and chairman of the board of
neighboring Gateway Consultants, which builds professional
sports arenas. "CEOs have to recognize their fate is in the hands
of employees."
Chema also stressed that for employee communications a
one-size-fits-all approach does not work.
PR managers can play a significant role in helping the boss get
out into the field. Facilitating Town Hall-like meetings is an
increasingly popular way for C-level execs to get face time with
their workers to pick their brains, but there is no substitute for
getting up close and personal.
At UPS, for example, VP of PR Ken Sternad, who is also a
board member of the Arthur W. Page Society, builds into CEO
Mike Eskew's public-speaking schedule meetings with customers and
employees. "I don't think many people think of integrating their
CEO's public appearances with employee and customer opportunities,"
Sternad says. [UPS this year received the top ranking in social
responsibility among Fortune's Most Admired Companies, and
was ranked No. 2 in the "delivery" space.]
He adds, "He'll sit down and have a cup of coffee with our
drivers or division managers to find out what's going on with the
business and to understand their points of view. It sends a clear
message that he is interested in their opinions. That, in turn,
helps communications up and down the line."
Sternad says Eskew has at least 10 or 12 offsite meetings a
year, in addition to regular internal communications. (For other
tools to make sure the CEO practices good employee relations, see
sidebar.)
"CEOs need to come to terms that internal communications is
urgent," says Allan Steinmetz, CEO of Inward Strategic
Consulting Inc. (Newton, Mass.), and a former senior
VP/director of marketing at global management consulting firm
Arthur D. Little and one-time director of marketing and
business development at Young & Rubicam.
"It's important that they work it into the operation so they can
engage employees effectively," he adds.
Steinmetz says there are three things PR managers/directors need
to do before they walk into the CEO's office to persuade him or her
to hobnob with the hoi polloi:
- Educate yourself about the company's strategic
imperatives. - Enlighten the boss with stats and/or measurements that show the
effectiveness of internal communications. - Examine the overall execution and view internal communications
as a process and not as a deliverable. Spitting out the internal
"headlines" to the rank-and-file plays into the notion among many
senior managers that PR is tactical and not strategic.
A study released in December 2004 by global human-capital
consulting firm Watson Wyatt said the better a company
communicates, the better return on investment (ROI).
According to the report, a significant improvement in
communication effectiveness is associated with a 30% increase in
market value. It added that companies that put a premium on
communication were more likely to report employee turnover
significantly below their rivals.
"We're not talking about some weak HR, touchy-feely thing to
do," says ArLyne Diamond, a Santa Clara, Calif.-based management
consultant. She adds that employee relations "is a critical
component to building a better company. "
Contacts: Tom Chema, 330.569.6112, [email protected]; ArLyne Diamond,
408.554.0110, [email protected];
Allan Steinmetz, 617.558.9770, [email protected];
Ken Sternad, 404.828.6124, [email protected]