Abbott Shows How NOT to Communicate

Professional communicators stress the importance of sharing as much information as possible with employees--it makes them feel more engaged, empowered and builds organizational trust. Abbott Laboratories recently showed just how damaging the alternative can be.

On July 13, the North Chicago, Ill.-based health care products maker shed about 5 percent of its Lake County, Ill. workforce to boost profit margins that recently were below Wall Street expectations. Keep in mind that Abbott posted a 38 percent gain in second-quarter profits Wednesday, Wall Street wanted more.

How Abbott responded can be a case study for botched corporate communications. It's time to revise Abbott's portion of the book, "Good to Great," with the subtitle, "Great to Stupid." Here are observations made by two long-term Abbott employees--one who was there on "Black Wednesday," and the other who returned from vacation just after.

I came to work that day and opened the outer door to enter my building. A man was walking toward me, carrying a box, so I held the door for him. He didn't say anything to me, but I didn't think much about it. Until I saw a lady behind him, also carrying a box. It became a parade of people, each carrying a box. It was then that I put two and two together, realizing why there was extra security in the parking lot.

These people--most of them long-term employees--were told to give up their badges, that they were terminated effective immediately, and that they could fill that one box with their personal items and leave!

The reactions of the people as they walked by me were different. Some looked resigned to it--I don't know if that was how they felt inside. Others clearly had been crying, and looked scared.

Another Abbott employee who returned just after Black Wednesday, was incredulous when he heard about the lack of communication and compassion during the process. He spoke to many people in the days to follow, as colleagues continued to check on whether he was one of the survivors.

People said that the only thing they were told was, "Don't go to any meetings and stay by the phone at your cube." That was so that they could find you if you were on the list. One person I know, a single mom with twins, was called at home and told that she had to come in so that she could be terminated.

The managers who did the terminations had been told to read from a script and to not deviate from it. So the process was very cold. At 3 pm, managers called their remaining people together and told them it was over. One meeting turned into a grip session, and the manager said, 'This isn't your father's Abbott.'

Obviously. That calculated process of moving quickly and providing scripted information is advice that appeals to legal-minded people. Don't take a chance that you will say something that will let someone sue. Don't get into emotional conflicts.

That is crap, if you care about your employees. The people who worked for decades at Abbott and then were escorted out like criminals, and the people who worked for decades at Abbott and watched their friends escorted out like criminals now have one common enemy: Abbott. The anger and betrayal they are feeling will not be glossed over by next quarter's analyst reports. The rumor mill--always in fine form at Abbott--will be actively engaged; Abbott employees will not be. Don't expect productivity to soar anytime soon at Abbott.

And how did Abbott's stock price (the bottom-line reason for this heavy-handed event) fare afterward? Shares in Abbott dropped $2.06, or 4.1 percent, to close at $47.65 Wednesday on the New York Stock Exchange, one day after they closed at $49.99 to match a three-year high. That probably caused Abbott's board and management to lose more sleep than did their handling of employee terminations.

What is "IT Communications"?

Earlier today, an IABC colleague suggested that I explain what I do as an “IT communications analyst.” That explanation wasn't relevant to the original blog entry on the IABC Cafe, but does give me something to write about here.

When I applied for the job, I thought that IT communications sounded interesting, and that it must be very specialized. I thought I was the only person in the world solely committed to IT communications. That misperception was clarified after I decided to renew my membership in the International Association of Business Communicators (IABC), following a few years as a lapsed member. Battle scars from a tough job market had convinced me that I needed to strengthen my professional network.

When I rejoined IABC and attended some Chicago Chapter events, I began to meet other people who were fully, or partially, engaged in supporting communications within IT departments at their respective firms. What a revelation!

I hope that they will contribute comments to this blog entry over time, so that you can hear several voices on the topic. We play different roles within the companies we serve. One parallel responsibility is that we plan, produce and measure the results of communications that improve information flows within IT departments, and between IT and other parts of the business.

What do we do? Here's an example of the need, as expressed by a manager when I was interviewing for my current position:

IT people are good at designing and building systems. We're just not very good at telling people about it. We are great at figuring out ways to generate and gather data, but we don't know how to provide that data to the other parts of the business in a way that makes sense to them. I say that we are "data rich," but "information poor."

IT departments have been under scrutiny for several years now to show the "value" that they bring to the company. No one questioned spending millions of dollars on IT projects in the late 1990s because we were concerned about the world ending with Y2k, if we weren't prepared. No one in IT really had to explain what the money was spent on, other than it prevented the Y2k bug from destroying the company.

But when the economy headed south in the first few years of this century, companies needed to tighten the corporate belt, and IT was put under the microscope. IT leaders soon realized the importance of being able to articulate their vision and accomplishments to their superiors and the corporate bean counters. Enter IT communicators.

In my case, I developed a strategic communication plan that tied IT initiatives to corporate strategies. I also helped to build a communication infrastructure at the office where I'm located, including a prototype IT Intranet, where employees can quickly find templates and guidelines to help them to communicate more efficiently and effectively.

I don't have specific IT training or knowledge. That actually has come in handy, as I've stopped the spread of jargon and worked with people to explain things in language that non-geeks understand.

Recently, my CIO left the company. I provided strategic advice on how to communicate the event within the company, and how to prevent an escalation of internal anxiety. I worked with the company leadership to plan an all-employee meeting along with Q&As. This was accomplished between the time that I and my peers heard that the CIO was leaving (9 am) and when the all-employee meeting began (2:30 pm).

Not different from other communicators. I just get to see all of the cool, new toys.

Russell Grossman, BBC, & The London Bombing

I sent an email to Russell Grossman (IABC conference presenter and blogger) to check on him following the terrorist bombings in London. He agreed to let me post his reply to let everyone know that he is ok.

From: Russell Grossman
Sent: Friday, July 08, 2005 2:07 AM
To: Keefe, Tom
Subject: London Transport Emergency

Tom, thanks for the thought.

Was a very busy day as we brought our full emergency plan and comms into operation. We continued into the night. As people are so dependent on the Tube in London we had to provide help for thousands of staff stranded at work. Also for people on rota getting in etc.

But we have practised this a number of times in drills every 6 months since 9-11 - we've been expecting something like this to happen for a bit. Thankfully it's not 'dirty' bombs. That's the real worrier.

The 38 dead and many more injured is terrible, of course but every time this sort of thing happens more lingering is the fear of using the system period kicks in with many people.

My daughter was caught on a stuck tube yesterday but she's OK thankfully but now more wary of using the system.

Russell

Ammo and Missiles and Rockets--Oh My!

The pen or the sword? Choices, choices, choices.

At the same time that 1,300 communicators gathered last week at the Hilton Hotel in Washington, DC for the 2005 IABC International Convention, attendees at another conference nearby were targeting another topic: firepower.

Yes, I missed the opportunity to attend "Firepower 2005: Guns, Rockets, Missiles, Ammo," just because I lean more toward the pen than the sword. I learned about the Firepower conference when my flight home was delayed a day. I stayed at a Doubletree hotel near the airport, and spotted the Firepower literature on a table. I nearly cried when I realized what I had missed!

- A birds-eye view of the Armed Forces strategic and ballistic Missile Defense programs
-An understanding of the role of weapons systems in future battlefield supremacy
-How the U.S. Armed Forces is evolving into a joint tactical fighting force
-Compelling case studies of some of DoD's premiere weapons programs

Any program that includes sessions on both high-power electromagnetic radiators (nonlethal directed energy weapons) AND 155mm Howitzers has to be a party!

I was a little worried about the quote from Colin Powell, former chairman of the Joint Chiefs of Staff, that appeared on the cover of the conference brochure:

Our strategy to go after the Army is very, very simple. First we are going to cut it off, and then we're going to kill it.

Hmm...which Army did he mean? Is he a former Navy guy?

Communication by being Hurd

Jeremy Pepper did a fine job summaring a speech by Hewlett-Packard CEO Mark Hurd, delivered on Wednesday to the International Association of Business Communicators (IABC) members present at the 2005 IABC International Conference in Washington, DC. You can read Jeremy's summary, "Listening To Hurd," on the IABC blog.

I added the following additional information, along with other comments.

Hurd spent a little time discussing his irritation that Sarbanes-Oxley and other regulation have forced CEOs in publicly traded companies to communicate information of a "material nature" (i.e., that could affect a company's stock price)--such as top staffing changes--to the stockholders and Wall Street analysts before company employees. That's because if the information leaks from within the corporation, it could result in penalties and liability.

One solution that Hurd mentioned is that he immediately walks from his analyst conference call meetings to an employee broadcast to relay the same information to employees. When he meets with employees, Hurd prefers a flipchart over a PowerPoint presentation. Explaining his low-tech preference for flipcharts, Hurd said he wants to answer employees' questions, rather than push his viewpoints and opinions at them. Showing a PowerPoint presentation can send the message that, "I don't know your question, but here's the answer," he said.

He also stated that when he came to H-P, he pushed his staff to rely on themselves, rather than consultants. He told his senior staff, "I pay you to have an opinion." Those staff members need to "be crisp" in their presentations. Rather than watching 50-60 slides, he prefers a 1-page summary supplemented by a staffer's verbal presentation. "You tell me the story because then I learn how you think," he said.

Hurd expects to see corporations continue to invest in the Asian market, because corporations have a great amount of available cash to spend. H-P, for example, has $16 billion in available cash, with no debt, he said. As corporations look to invest, they need to be mindful of trade imbalances, he added, specifically mentioning China.

During Hurd's Q&A following his speech at the IABC Conference, I told him about the discussion underway regarding the role of CEO communication versus supervisor communication, and asked for his view on what works in his organization. This is a fairly accurate quote from him.

"I don't think that a CEO can replace the relationship of employees and their front-line supervisors," Hurd said. "But the CEO can provide a context relative to the whole company, to try to create clarity around the mission."

He later provided a supporting comment while answering a separate question when he said, "When I promote, demote, recognize and reward people, I tell 30,000 people what I value." That is the essence of the CEO's influence.

IABC International Conference 2005