I'm willing to bet my next sound bite, that if you're in the business of corporate communications, chances are you'll have to announce a layoff some time in your career. During one week last November, three major U.S. brands announced a total of 20,000 jobs, and many of those came on top of substantial cuts earlier in the year. In the past, we've analyzed the results of dozens of lay-off announcements, and what we've learned is that how the press portrays the news has very little to do with how many jobs you're eliminating. The biggest determining factor is corporate culture.
In the early 1990s, all three of the big computer manufacturers (IBM, Digital and Hewlett-Packard) announced layoffs for the first time in their corporate history.
And while headlines screamed about IBM and Digital's "First Ever Layoffs" followed by a flurry of negative articles, Hewlett-Packard generated barely a blip on the media radar screen. Reporters talked about H-P's restructuring, reassignments, etc., but the words "layoff" and Hewlett-Packard were almost never in the same article. In the end, we concluded that the reason for the difference was Hewlett-Packard's culture of corporate modesty and excellent relations with the press, coupled with an incredible package of outplacement services.
Now, more than five years later, two other major stalwarts of American industry, Kodak and Levi Strauss, are in parallel situations. Kodak has announced a work force reduction of 10,000 workers or 11 percent of its work force. The stock initially dropped 6 points and a slew of negative press ensued. Conversely, Levi cut 34% of its workforce and the press did a great job of communicating its worker-friendly policies.
The difference is that Levi's has long been known as a great company to work for and has been positioned as a company with a conscience.
But Kodak has been portrayed as "paternalistic" and "the great yellow father"- almost anachronistic - and clearly not in pace with the times.
The problem is that the latter's image problems can't be solved in one press conference or one announcement. They require a long-term strategy of words and actions.
Katharine Paine is founder and CEO of The Delahaye Group, an international image consulting firm based in Portsmouth, N.H. She can be reached at 603/431-0111. Paine will be one of the speakers at PR NEWS's upcoming crisis management workshop Feb. 17 in D.C.
Eastman Kodak
Corporate Headquarters: Rochester, N.Y.
VP & Director of Communications and Public Affairs: Michael Benard
No. of Employees Worldwide: 95,000
No Main PR Firm
1996 Sales: $20 billion; Contact: Paul Allen, 716/724-4000
Levi Strauss
Corporate Headquarters: San Francisco
VP Global Communications: Dave Samson
No. of Employees Worldwide: 37,000
Main PR Firm: Fleishman-Hillard, S.F.
1996 Sales: $7.1 billion
Contact: Brad Williams, 415/544-6000