Corporate communications about CEO transitions always should be tempered by honesty about what you don't know. Even though your goals - to correct a flawed product line or repair the company's Wall Street image - might be close to grandiose, your communication must be direct and without spin.
Intel's recent handling of Andrew Grove's resignation as CEO and naming his replacement can serve as a model in handling such cases. However, most transitions do not go this smoothly.
Many companies have been scathed by CEO transitions - Apple has yet to find a replacement for Gil Amelio; and AT&T is still rebounding from having an outsider as a CEO.
Avoid the temptation to oversell the new CEO, cautions Michael Kokernak of the Berkshire Marketing Group, Troy, N.Y., who worked for several years in investor relations for a small-cap company. "If you sugar-coat things, the press won't take your next release quite as seriously."
"This is a process that needs to be managed very carefully," agrees Carol McGarry, executive VP of Schwartz Communications, Inc., Waltham, Mass. "You need to project a sense of confidence in the new leader by linking his or her background to your business."
Execs at Schwartz, which posted $10.2 million in billings during its last fiscal year and specializes in emerging markets, pinpoint CEO or upper-management changes as one of the most delicate processes. Refrain from speculation and release timely information simultaneously as plans are secured. And as much as you can, give the press access to your new leader.
Controlled Change
During the transition phase, you must control the situation instead of it controlling you. Bringing a new CEO on board is best managed by building behind-the-scenes relationships with opinion leaders, including the media.
"You may even want to go off the record with journalists with whom you have critical relationships, but you don't want to violate [SEC] disclosure laws," adds Kokernak.
Your most important audiences will vary depending on the type of company you represent, adds McGarry.
"If yours is a private company, your overriding goal is to build confidence with shareholders and the financial community, and if yours is a private company, your first priority should be your customers and employees...And in all cases, a major faux pas is when you inform other publics before you tell your employees."
In recent weeks, business reporters worldwide have filed thousands of words about the March 26 announcement that Intel's CEO Grove, Time's 1997 Man of the Year, is stepping aside. He will be replaced by Craig Barrett, president and COO.
Barrett is expected to assume the CEO position after Intel shareholders and board members meet May 20.
He is the fourth CEO the Santa Clara, Calif.-based semiconductor giant has had since its founding in 1968.
These transitions are not always as palatable and companies do not always have the good fortune of setting the stage for these kinds of business moves.
Intel positioned the change as something that had been in the works for a long time. Additionally, Grove, who was on vacation when the announcement was made, returned that day to take media calls.
More than 100 reporters called for comments or interviews. About 25, including AP, CNN, the L.A. Times and The Wall Street Journal were given access to executives. Two corporate communications representatives arranged interviews with the aforementioned outlets as well as local media, such as the San Jose Mercury News, and Web-related publications such as ZDNet.
So far, the media coverage, such as the April 6 piece in U.S. News & World Report, can be deemed a PR victory. The stories detail Intel's battle in the computer chip wars, but is rife with corporate perspective, primarily that Barrett was groomed for this slot and it was long in the planning.
"We didn't have to do much internally," says Intel spokesperson Howard High. "Our biggest challenge was dealing with the number of reporters who wanted to speak with him (Grove)."
And if stock price is any indication, the PR management in this case went smoothly. After the announcement, Intel's stock grew to $78. (Berkshire, 617/713-3626; Schwartz Communications, 781/684-0770; Intel, 408/765-8080)