Who Suffers Most After Layoffs?

I read a provocative article this week in BusinessWeek about a study of Boeing workers that suggests those laid-off from the company in recent years actually fared better – in terms of their morale if not pocketbook – than the so-called survivors. It’s long been accepted that after layoffs those left behind can have trouble adjusting to the staff turmoil and need careful attention to remain productive, but this study argues they often suffer more than those who are let go.

Based on my experience (which includes work for Boeing during the tumultuous years mentioned in the research) the critical factor in this equation is the workplace environment, rather than any staff changes. If the corporate environment is tense and depressing, the survivors may indeed be worse off than those who get a fresh start. And though the unemployed certainly have to face the myriad stresses that come with finding new jobs – often at lower pay – many benefit from a more positive, less stressful working environment. In effect, money and security can sometimes be outweighed by personal satisfaction and well-being.

Other factors that play a role in which side suffers most include:

• Who leaves and who’s left behind – are the layoffs perceived as a talent drain…are popular, talented stars part of the exodus?
• How are the layoffs communicated – are employees kept well informed of the process (and rationale) and given a chance to air their concerns and questions?
• Do the layoffs appear to be part of a logical, solid business strategy or a knee-jerk move to cut costs?
• Is there a transparent, credible process for determining who gets laid-off, or is the process capricious and opaque?
• Has leadership laid out a clear timetable and strategy for addressing market challenges (and reducing the need for future layoffs?)
• Can the remaining employees rally around a compelling vision and benefit from a dynamic, positive culture?

Many successful companies navigate through layoffs without long-term damage, so cutting staff is not a corporate death sentence. The key is for companies to handle staff changes in a humane, candid way and sustain their culture and employee value proposition through good times and bad.

Social Media Boosts Performance for Leading Brands

A recent study by Altimeter/Wetpaint makes a solid case for a strong link between superior financial performance and deep engagement in social media…at least across the world’s leading brands. They conclude: “socially engaged companies are in fact more financially successful.” Some ardent advocates of social media have argued against trying to measure its value using traditional metrics – like financial ROI – but nevertheless this study fills an interesting gap in the debate.

Beyond the headline finding, there’s plenty of other good info in this report. Perhaps one of the most interesting conclusions is that social media is virtually a given among the top 100 brands – which surprised me – though the authors admit too many companies still dip their toes in without fully planning or sustaining their forays. The companies featured as the most “engaged” are the usual suspects – Dell, Starbucks, SAP and Toyota – and the study does a good job of quantifying engagement using an analytical model and even details 4 categories of engagement.  (Full disclosure, I was part of the social media team at Dell in 2007-2008 and directly involved in the work described in the study.) There’s also some good best practices and take-aways for communication and marketing professionals to leverage.

Now it remains to be seen if this study – along with other positive reports and testimonials driving the adoption of social media – are enough to convince skeptics and laggards…particularly those beyond the top 100 brands. In fact, I’m eager to find more evidence of how many organizations are truly engaged in social media – and not just in the U.S. or among the biggest organizations.

The Presidential Candidates as Brands

As a Canadian, I have watched the presidential campaign in the United States with a detached fascination. As the campaign has progressed, I’ve become increasingly numbed and disappointed, and not just by the torrent of disingenuous and shrill attack campaign ads. What’s even more interesting – as a student of marketing and PR – is how the candidates have ignored some of the basic rules of communication – in particular the core tenets of marketing. If the candidates were being judged as brands competing in the marketplace - they would get very mixed reviews. Let’s review how they rank against some key elements of successful branding.

• Focus: One of the central tenets of effective branding is having a clear, cogent brand identity. If customers (or voters) don’t have a clear sense of what you stand for, you have a serious problem. I would argue both candidates have muddled their identity and messages to the point where most voters are unclear what they really believe and what they stand for. Take McCain as an example. He starts the year as a renegade maverick who proudly bucks most of the Republican establishment. In the past few months, he has predictably softened his message on key issues and taken on the mantra as the Straight Talk Express. More recently, shaken by the implosion of the financial markets, he has apparently turned his back on decades of traditional Republican dogma about small government and free markets and remade himself a deathbed convert to regulation and Wall Street bashing. His focus on key issues has gone through a similar windmill depending on the vagaries of the campaign. Now he has belatedly joined Obama as the candidate for change and positioned himself as the real outsider. Whatever your political views on these twists and turns, it’s likely unclear to many what McCain stands for anymore…beyond perhaps getting elected. It doesn’t help, of course, that McCain’s opponent Obama is doing all he can to attack McCain’s positioning (see friend of George Bush ads) and protect his own turf.
• Differentiation: As per the above, while both candidates are striving to carve out their distinctive positions (and inherent advantages as candidates) their drifting positions have likely made their pitches more diffuse and confusing.  Here’s a test: who is running as the most credible change agent, Washington outsider and somebody who no allegiance to lobbyists? Yes…both of them. This one should be easy given the inherent polarization of politics and electoral campaigns, but aside from splits on a few fundamental issues the candidates are stepping on the same platform.  
• Credibility: This is a tough one given the inevitable histrionics and exaggeration of political campaigns, but even by those low standards of probity I would suggest the aggressively partisan advertising – which is usually quickly debunked by most impartial fact-checkers – seriously erodes the credibility of both candidates. It’s never a good thing when voters (or customers) expect most of what you say to be only distantly related to the truth.
• Consistency: See comments above. Even the most ardent political junkie would be hard pressed to keep track of the protean positions of the two candidates. It’s fine to adjust your position on key issues, but another thing altogether to do so for political expediency. The only thing that is consistent is the reactive and poll-driven messaging. I would also give Obama some credit for being consistent about his campaign theme and core messages – despite pressure from insiders to change it when the polls dip.
• Relevance: Most brand stewards stive to get to know their customers and respond to their desires and aspirations so they’ll buy your products or services. In politics, you use the same method to get their votes rather than their money. Given the amount of polling involved in this campaign, it’s clear the campaigns are working hard to be relevant to the voters…all the way down to specific voter segments or even neighborhoods. I’d have to give them decent marks on this one – in fact this may be one area where marketing has something to learn from politics.
• Third-party (customer) endorsement: Though the parties and candidates have thousand of passionate fans, it’s much harder to find impartial supporters who are not partisan or dogmatic. It does appear Obama has generated genuine enthusiasm among many who have not traditionally voted, so give him higher marks for creating buzz outside the traditional Democratic circles.
• Positive word-of-mouth: See point above. Plenty of noise and ardent cheer-leading but it’s not clear how much is real or will last beyond the election.   
• Compelling advertising: Though many pundits claim critical campaign advertising is effective it’s clear that most of the advertising we’ve seen in this campaign has been formulaic and largely lacking in creativity and imagination. You know the type: highly critical attack ads that stick closely to the tried-and-true formula of dramatic banner headlines and splashy visuals. No subtlety here. Ads that break the monotony (and cacophony) are very rare…I can’t honestly recall one that stuck out. And there lies a major flaw of these campaigns – they are hopelessly predictable. Even if they work and some of the mud sticks - which is debatable – I firmly believe they ultimately erode the reputation and credibility of the candidates rather than enhance it. 

Of course, unlike the real world one of these candidates will end up making the sale – and getting elected – no matter what they do. That’s lucky for them, because if they were in an open marketplace they may not close the deal.

Can Employees Handle the Truth?

“You can’t handle the truth!”. Many of us remember that famous line shouted so eloquently by Jack Nicholson in A Few Good Men. In recent weeks I’ve had several discussions with peers and colleagues that ask whether this quote is accurate when it comes to sharing information with employees. One example: sharing the results of an employee survey.

Here is the scenario. Assume you have just conducted an annual global survey of employees for a global company. The workforce is slightly cynical about the process due to uneven communication and lack of visible follow-up during previous surveys.  Sharing the highlights of the results – and focusing on driving tangible changes based on the findings – is a given. So is using all relevant communication channels, including regional and local managers, to cascade the information. But here’s where it gets less certain. Would you make most the data available to all employees, to peruse or compare at their leisure? Should you allow them to review customized reports with breakdowns by country, function or role? Would all this result in information overload and competitive sniping or foster a new sense of transparency and trust?

Here’s where we came down on this issue. Given the latent cynicism of employees regarding surveys in particular (and management in general) the default should always be to share information – or at least make it available – unless there is a good reason not to. In the case of surveys, one could reasonably argue the information is better presented with the proper context and with the right level of detail and local customization. It also helps to have key leaders take a personal role in the communication process to emphasize their personal interest and accountability. But it also sends an important message if in addition to the proactive communication process the company allows any employee to access relevant data or reports (for example on a dedicated website.)

There should be limits to this transparency, however. The obvious one is to protect the confidentiality of respondents and not present detailed data that allows close comparisons beyond (or really below) the major functions or regions, since that might create dissension and/or invite criticisms of specific teams or managers. The other is to ensure employees understand the information is confidential and not for external distribution. But beyond that the onus should be on opening the windows, so to speak.

Many discussions involving the issue of transparency with employees implicitly suggest most employees are not capable of fully understanding information unless it’s fully “digested” for them, or not responsible enough to have access to the data – with the inference they will use it to attack managers, foster dissension or even leak the information. The inference is usually based on the employees’ level and job function (white collar is ok, blue collar is not.) Though there will always be bad apples in any company, in my 20 years of experience I’ve never seen compelling evidence that a majority of employees will abuse the priviledge of candor, or that the risk outweighs the benefits. And I’m don’t necessarily buy the logic that the workforce can be easily divided into white or blue collar (or front-line) workers. Some would argue age, or generational divisions, is much more relevant. 

No matter the workforce, the role of the communication professional is to find the right balance between candor and overload, and the best way to share information and foster relevant dialogue. It’s also critical that we strive to be relevant and responsive, so the communication process is a dialogue rather than a one-way street. But the default should always be to give employees the benefit of the doubt and treat them like intelligent, trustworthy partners. That’s the only way we can build credibility in the process (and leadership team) and drive employee engagement.

Enabling Employees Key to Competitive Edge

A study by the Economist Intelligence Unit suggests that giving people (employees) the information technology tools, infrastructure, and support they need to do their jobs effectively will help your company outdistance the competition. The study’s main conclusions are:

• The more a company empowers its employees to make decisions, the more likely it is to perform better financially and competitively.
• True enablers use technology to improve collaboration, encourage risk-taking, and optimize decision-making.
• Companies categorizing themselves as “true enablers” are three times more likely to be more profitable than their competitors.
• Compared with other types of firms, companies described as “true enablers” have a higher proportion that are more profitable than their competitors.

The study defines enablement as the organizational structures, informational technologies, and other resources that make it possible for employees to make decisions. In other words, trust your employees to make the right decisions. Not surprisingly, the study found that when it comes to IT, there is a significant “enablement gap” in most companies. Sound familiar?

Though many CIOs might disagree, most IT departments are strongly risk-averse not yet prepared to give employees the leeway they need to find information, indulge their creativity and collaborate with peers. It’s hard to feel “enabled” when you can’t get access to the Internet, or even download the latest version of Visio or Firefox. Though IT has valid reasons to be cautious in terms of loosening the controls and providing new tools – notably security – this new study suggests there is far more reason to take a leap of faith and give employees the technology platform to reach their full potential. IBM and Sun are two companies that have embraced this approach, to their benefit. Let’s hope other follow in their footsteps.

Web 2.0 in Davos

OK, this post really isn’t about PR. But it is about how Web 2.0 technology and values are getting traction well beyond the fields of marketing and communications – the ostensible focus of this little blog. Witness the agenda of the upcoming World Economic Forum in Davos, as outlined in this BusinessWeek article: collaborative innovation. Sound familiar? None other than  Wikinomics guru Don Wapscott will regale the world’s intelligentsia and moguls about topics like collaborative marketing and radical transparency. So if the global business elite can discuss this, why is it still so hard to get through the door at your friendly company around the corner?  

The Value of Word of Mouth

A recent global study by Neilsen suggests that word-of-mouth remains – by far – the most trusted opinion and most effective form of marketing online. See this post on eMarketer on the study.  This adds to the evidence that online consumers trust their peers far more than corporate websites or paid online advertising (which is near the bottom of the list.) A related study by GFK Roper similarly found that consumers rate word-of-mouth recommendations as the most credible source to drive purchase decisions. Many companies already acknowledge this reality and are featuring ratings/reviews and consumer comments in their marketing outreach. But there appears to be plenty of room for companies to more fully engage in broad word-of-mouth campaigns with consumers. Yeah, posting ratings and reviews (particularly if they are positive) is a good step. But fostering that ephemeral buzz from fans – and getting them to spread the word – is the ultimate marketing objective. 

Who Owns Digital Media?

In most if not all of the conversations I’ve had or heard about digital media lately, a topic that invariably comes up is who “owns” it in organizations. Or more pointedly, who manages and coordinates the digital programs, who creates the content, who manages the blogs…and who should drive the digital strategy. This prosaic topic may appear trivial, but as any consultant worth his/her salt will tell you process and organization is critical to turning an idea into reality. From what I’ve seen and read, digital media efforts are led by a wide range of usual suspects in major companies - marketing, advertising, corporate communications, IT and sometimes even branding. And this is no surprise, since the elements of Web 2.0 technology cut across all of these departments – relevant to all, but owned by none. The problem with this lack of obvious ownership is that it seriously inhibits coordination and focus – and ultimately effectiveness.

No matter where the digital apostles work in a company or who is the most learned expert or where the blog moderators reside, it’s critical that companies begin to create new structures and processes to help make sense of the Web and drive coherent, integrated programs. It’s also essential to find and leverage the wide range of skills and expertise that are required to design and execute a strong Web 2.0 strategy – including serious technology chops, editorial talent, video production, project management, advertising experience, research, marketing, website design, etc. The list is long. Getting organized can be as easy as forming cross-functional teams that incorporate members from all relevant teams. And it likely means creating  some new senior roles so leaders can direct and track the efforts. Without this grunt work, companies may be relegated to one-off efforts that are often disparate and even contradictory. None of this means organizations need to create a new bureaucracy or be paralyzed by analysis - since glacial consensus-seeking and rigid regulation is anathema to Web 2.0 tactics. Think of it more as providing a basic sense of direction and order…Web-style.  

Measuring the Credibility of News Sources

Just read a smart blog by the folks at GolinHarris on a study they conducted in the U.S. to determine how people accessed information and which news sources people trusted more than others. First of all, kudos to these guys for looking at this issue with an open perspective – too often agencies and media companies seem more intent on protecting the status quo than finding real answers. I’m still absoring the detailed analysis, but highlights of the study are as follows:

• There is no substitute for personal experience – direct interaction is the most trusted information source across every demographic group
• Word-of-mouth is the second most important and trusted source, allowing users to “borrow” the direct experience of others
• Online media (CNET, WebMD) are more trusted by a majority of respondents than traditional news sources
• Radio is the most trusted mainstream media source
• Trust in social media channels is showing big gains, and these channels are perceived as important future sources
• Proactive news junkies – or individual influencers – are very active and important sources of information

If nothing else, this research confirms that new Web 2.0 tools have changed the face of news gathering and dissemination forever. [Full disclosure - I worked at GolinHarris for five years and have been known to share a beer with my old friends there. None of them, however, had anything to do with this study.]

Knowing Your Customers’ Online Habits

A few weeks ago Forrester’s Charlene Li put out a report on the profile of online users in the United States. The Report had enlightening information on the different preferences and activity levels of online participants – ranging from a minority of creators and critics to spectators and inactives (who comprise a narrow majority). Though the data is interesting on its own merit, the bigger lesson in the report is the advice to carefully analyze your customers’ online habits in order to tailor your digital menu, rather than just jumping in with an ad-hoc selection of trendy applications or sites. Sounds logical, but in the rush to avoid getting left behind this is wisdom I fear too many organizations are ignoring. Of course, this due diligence also applies to audiences beyond customers – such as employees. Organizations seeking to reach out to any specific audience or community using online tools needs to define the profile and usage preferences of these groups – as best they can - confirm the purpose for the outreach (to listen? to collaborate? to solve problems? to market?) and then design their outreach strategy accordingly. Companies who do this should be able to answer the all-too-common question asked about digital media at conferences everywhere - should our CEO write a blog? If you do your homework, you can answer that better than anyone.