What management says it wants in communicating change - includes related article

For decades, communication professionals have been working hard to convince senior management that communication is important to the future success of their organizations. A recent survey by professional services firm KPMG in Canada provides solid third-party endorsement for the communicators' message.

The "Managing Change" survey studied the experience of 131 of Canada's largest corporations regarding changes such as mergers, acquisitions, downsizings, new strategic visions and reengineerings. Of the seven success factors considered in changes such as these, communication was found to be one of the most important.

From this survey and from other experience, we've been able to extract five lessons for communication professionals regarding the communication of change initiatives.

1. Senior management believes that communication is not handled well. It's important to remember that KPMG didn't canvass communication professionals for this survey. Respondents held a variety of senior management positions. Fifty-seven percent held the position of chief executive officer, chairperson, president or executive director. Thirteen percent were vice presidents or directors.

KPMG found that while many respondents (72 percent) said in their survey questionnaires that they had a communication strategy in place, only 54 percent felt that managers kept employees well informed regarding the change.

Consider the results of not having an effective communication strategy: the case of a manufacturing company, a good example of how to start out right and end badly.

This company sent all the right signals at the beginning: that the downsizing was necessary, that it wasn't the employees' fault, and that the company would do all it could to relieve the situation through severance packages. This demonstrated a clear understanding of the need for appropriate communication.

But then, the company added a kicker: They promised that once this downsizing was done, there would be no more dismissals.

Two years later, they reduced staff counts again, only to promise once more that there would be no more downsizings.

When the third downsizing occurred three years later, it wasn't surprising that the company's "never again" promises were not believed. Morale hit rock bottom, and many people didn't wait to be told to leave. There was a mass exodus of staff, including people the company really could not afford to lose.

In all fairness, it should be pointed out that management genuinely believed it was telling the truth each time it said that each downsizing would really be the last. But honestly held or not, that false optimism meant that the company lost credibility with its employees.

The error of promising what it could not deliver - a commitment to no more layoffs - sounds elementary, but it's the sort of thing that we see all too often. Even a basic strategy goes a long way to preventing this sort of problem.

A good strategic communication plan might have positioned the original downsizing as part of continuing change, rather than as an isolated event with a definitive end. While stating that further downsizing was not anticipated would not provide the degree of certainty that employees would have preferred, it might have been more effective for the organization's longer term initiatives.

2. Communication must work with other aspects of the organization in making a change successful. The survey indicates that there are seven success factors for any change initiative. They are:

* Priorities: For a change initiative to be successful, it must be embraced as a priority throughout the organization. Generally, this seems to be well handled - 88 percent of respondents believed that top management personally committed enough time.

* Communication: Make sure all stakeholders are kept informed of the change.

* Involvement: Wherever possible, employees should collaborate in the process. This seems to be a problem area, with few respondents saying employees were given a role.

* Monitoring: Most respondents believed that their organizations did well at tracking the change to make corrections if problems developed.

* Resistance: Any change, no matter how beneficial, will encounter resistance. Only 45 percent of respondents said they got people to talk openly about why they did not want to change, and only 58 percent said they dealt with resistance in an open and constructive way.

* Resources: There must be enough financial and time resources to complete the job.

* Reinforcement: Employees must be encouraged to act in ways that are beneficial to the new organization. Results here were mixed - 55 percent of respondents updated their reward systems to reflect the new environment and requirements, and 65 percent said that they had rewarded people making a significant contribution to the success of the change initiative.

Communication initiatives must relate well to the other six components. For example, dealing with resistance is largely a communication function, and reinforcement will not work unless all members of the organization have been made aware of any changes to the reward structure.

3. Change initiatives require sufficient time and resources to complete. KPMG found that in some ways, this was done well: 80 percent of respondents said they had invested adequate financial resources and 70 percent had allocated sufficient time lines to the change. However, only 56 percent of respondents said all employees had access to training, information, support and resources.

This is consistent with our experience that employees often do not feel they receive sufficient training, information and support. Take the time to train supervisors and managers on how to communicate with staff and how to respond to questions and concerns.

Comments from respondents echo this concern: "Whatever time you think it will take, whatever cost you think it will be double it!' 'Add more dedicated resources, namely head count devoted to delivering plan." "Even stronger commitment of capital and human resources to try and shorten the process."

4. People must be told how the change will affect them personally. In many major changes, there is a significant knowledge gap: Just 37 percent said that people at all levels of the organization had a clear and realistic understanding of how they, and their jobs, would be affected by the change.

In the case above, the first messages sent to employees, shareholders or not, was about the status of their jobs. Second, the employee-shareholders were told about the effect that the change would have on their investments.

A. The success of any change is directly related to its acceptance by employees, and employees will naturally be concerned with their own welfare first.

What can we learn from this example? For one thing, that change is inevitable, and that a major strategic advantage comes to organizations that do it well.

B. Second, the success of the change is directly related to its acceptance by employees, and that acceptance is influenced by the appropriateness of the communication to the organization. In one downsizing example, that meant a personal address to employees at a meeting, held by the president.

5. Give senior and middle management people the communication skills they need. KPMG's survey found that only 46 percent of respondents said management received training in effective change management and techniques. This translates into a knowledge gap.

It's up to these people in management to deal with the "cultural distress" that occurs in any sort of change - the organizational fabric is affected, and this causes discomfort and concern among members. The most common response to this is to seek information - anything that will help employees understand where they are going. And it's important to realize that "information" is not restricted to the newsletters, meetings, videos and intranet sites the company produces.

In any change, the informal "grapevine" communication network grows tremendously. Information both true and false travels around the company with astonishing speed, and it is often taken by employees to be more reliable than anything found in the "official" sources.

So work with the grapevine, not against it.

Push the message down so that it is received by the person most employees prefer to hear from - their immediate supervisor.

In any organization, there are "key mouthpieces" - individuals who are like switchboards on the grapevine, who influence many people in what they say. Often, they're individuals who have a chance to talk to many different people in their work. Get them involved.

You may also want to set up a rumor line. For people who have questions about the change, suggest they call in from the outside, where their call can't be traced and anonymity is preserved. A special mailbox in the voicemail system receives their questions, and someone in authority then posts the answers, possibly on a physical or "virtual" bulletin board on the E-mail system, or in a newsletter.

As the study found, it's important that the communication process provide channels for feedback - for employees to express their opinions, recommendations and concerns.

But while our experience is that the communication needs are greatest with the "front line" staff lowest on the organizational pyramid, to reach them it is essential to build better links with all levels of the organization.

Pay particular attention to the needs of middle management.

While senior management members have likely discussed the change, understand the need for it and are on-board, this does not necessarily apply to middle management and it is here that the process often breaks down.

These people are naturally concerned about their own situations first, and any communication strategy has to take them into account. Many of them feel threatened by the change - possibly for their jobs, or seniority, or prospects for advancement.

In this environment, it's unreasonable to ask middle management to think of the company's best interests. This may cause them to distort top management's message, consciously or unconsciously.

Find out what their concerns are. Quite likely, they will be concerned about how it will disrupt their lives and work, and what's in it for them, both positive and negative. They need to know that they will be okay.

In this instance, "OK" doesn't necessarily mean that their jobs are secure. In some cases, you can give them that message. But in others, these people can only be assured that the company will look after them as best it can. If middle management members must be released, they need to be reassured that they will have a good severance package, including outplacement counseling.

But in all cases, middle management must understand the need for the change. Then, these people can give a coherent message to their direct reports, and so on down the line.

Any change is stressful, even one such as an acquisition that may be positive for the organization and its people. Communication professionals doing their job can go a long way in making the process the best possible for everyone.

RELATED ARTICLE: Select your messages carefully

A downsizing can be one of the most difficult challenges facing a communicator.

Consider this case: An industrial division of a larger company was forced to reduce its work force because the division was about to be sold.

Corporate management saw that its work force could be divided into three parts: those employees who would be dismissed immediately, those who would be needed to keep the operation running for about three to six months until the division was sold, and those it wanted to keep for the longer term. Different communication packages were prepared, and middle management was coached appropriately.

Those to be dismissed right away were given the legal minimum notice and provided with an outplacement package, clearly explained to them.

For the group to be kept in the short term, it was not so simple. These people were offered a standard severance package, but told that there was a possibility that they would be kept on for some time. They were offered a "stay-put bonus," payable only if they stayed on until management was ready to release them. If they left early, their severance package would be drastically curtailed.

As it turned out, some of these people left as soon as they had another job offer - reasoning that they might not have other work to go to if they waited until the company asked them to leave. However, enough of these people stayed on to allow the company to prepare the division for sale.

For the third "keeper" group, the company developed "golden handcuffs" package that induced most of these people to stay on.

In this case, communication was key. Without it, employees would not have understood the situation, or accepted that the company was doing all that it could to meet their needs.

Michael Barrett leads the KPMG communication practice in Toronto and Barbara Luedecke is a partner in KPMG's change management practice.

COPYRIGHT 1996 International Association of Business Communicators
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