Paul Holmes 21 Jan 2004 // 12:00AM GMT
In the midst of its industry’s worst-ever downturn, International Truck and Engine Corporation needed to rally employees to achieve hundreds of millions of dollars in business improvements within two years. Matha MacDonald’s year one communications program, targeted to Truck Group employees, laid the groundwork for change, providing clear direction and information focused on implementing strategies while minimizing confusing and conflicting messages.
Matha MacDonald focused on moving information down through the organization, and pulling feedback through the system to build credibility and trust in decisions, enable management to address hot issues and free employees from searching for information so that they could focus on getting results. By 2002’s end, there was strong progress, as the Truck Group met its financial targets for the first time in two years.
In the mid-1990s, International Truck and Engine Corporation climbed from the Wall Street Journal’s list of “Worst 10 Companies” to its “Best 10 Companies” list and Business Week’s list of top 50 performers—capping an intensive three-year change effort. But as 2002 dawned, it was clear that employees could not rest on their laurels. The Truck Group, the company’s largest business unit, ended 2001 with multi-million-dollar losses, contributing to a $23 million loss for International. The Truck Group’s 7,500 employees—from management to the frontline—would need to take swift and sizable action for the company to remain viable.
The communications objectives were to create a vision of success; align Truck Group leadership behind vision; earn credibility through straight talk; raise understanding of business issues; instill a sense of urgency about the current situation; motivate employees to take personal accountability for change; and create a dialog between management and employees.
The audience consisted of four segments with distinct, yet interconnected, roles and responsibilities:
· Truck Staff: 18 business group heads, who report to the Truck Group president. They needed to build the case for where the Truck Group is going and why, demonstrate an aligned front, take a visible role in communicating the need for change, and inspire belief and confidence in management decisions.
· Leadership Council: The Truck Group’s top 400 managers had day-to-day accountability for communicating the challenges and leading and motivating action “in the trenches.”
· Leadership Forum: These 1,200 mid-level managers had responsibility for “getting the job done.” They needed to understand business objectives, their role in achieving them, provide feedback and act.
· Frontline Employees: Some 6,000 employees on the plant floor needed to believe change was necessary, that they had a role in it, offer ideas and take action.
The strategic approach was to assess where the organization stands on the need for change and employee understanding of the business strategy; create a context for change: where we’d been, the current state, the future vision, and the actions needed for success; develop tools to enable leaders to engage in straightforward dialog with employees; and seize key opportunities to leverage communications to drive action, highlight progress and recognize employee achievements throughout the company.
An initial phone survey gave a baseline measurement of leadership’s attitude about the current situation and what people understood about the business strategy. Matha MacDonald found broad recognition of the need for change, and employees believed the company was focused on the right actions. On the other hand, employees didn’t view change as a personal mission. It also was apparent that the strategy wasn’t penetrating below senior levels of the company. These findings provided Matha MacDonald with a blueprint for its communications efforts. Periodic assessments along the way would help to gauge progress and calibrate our efforts accordingly.
Matha MacDonald recognized that the complexity and magnitude of change could overwhelm people, and that had the potential to stymie action. Thus, Matha MacDonald simplified the situation to lay a foundation for change that people could get their heads around. Matha MacDonald then quickly built on that base to deepen understanding and drive action. To do this, Matha MacDonald took a phased approach.
During the first phase Matha MacDonald de-constructed and simplified business plans, and worked with Truck Staff to identify critical actions to achieve goals. Matha MacDonald organized actions under three easy-to-remember priorities: Operational Excellence; Successful Product Launches; and Profitable Market Share Growth. To help leadership have a meaningful dialog with employees about these priorities, Matha MacDonald created a message platform—a communications and persuasion tool designed to appeal to hearts as well as minds. Input was sought from each Truck Staff member to gain alignment on the platform. And Matha MacDonald vetted it down and across the organization with managers and frontline supervisors to ensure that they felt credible when delivering the messages to employees.
In the second phase, using the platform as the compass, Matha MacDonald created a communications toolkit. It consisted of the message platform, a State of the Business presentation that leaders could customize, position papers centered on the three priorities, and question-and-answer documents to help top leaders communicate with their teams. These materials would not only ensure consistency of message and create a common understanding of the vision, but prompt conversation between managers and employees. First quarter earnings provided a timely opportunity for leaders to communicate: The Truck Group recorded a multi-million loss, underscoring the urgency for action. The Truck Group president rolled out the toolkit in his monthly conference call with Leadership Council, and made it clear that all leaders needed to communicate these business priorities to their teams.
Once the platform was established, Matha MacDonald leveraged existing channels and created new opportunities to communicate with its audiences to help drive action deep within the organization.
· Truck Staff: At his monthly staff meetings, the group president continued to articulate his expectations for top leadership. The Truck communications manager tapped staff members to be the “voices” for change and visibly support the platform to ensure that their words and actions matched.
· Leadership Council: Matha MacDonald made a concerted effort to communicate consistently and frequently with this group, as these leaders bore chief responsibility for developing plans to achieve the strategy.
· Leadership Conference: Matha MacDonald capitalized on this annual spring meeting to take a deeper dive on the three priorities, highlight actions under way, drive needed alignment and achieve a laser focus. The group president made it clear that the time for debate was over—it was time to act. Leadership walked away with a clear understanding of what they needed to do to promote understanding and motivate employees to action.
· Leadership Conference Calls: The group president used this monthly forum to keep in front of leaders, maintain focus, report on progress, and highlight individual and team actions. The calls were structured around the key priorities, and a Q-and-A session was always built in so participants could have a dialog with the president.
· Truck Performance Newsletter: Matha MacDonald leveraged this monthly leadership newsletter to reinforce the message platform, communicate progress, spotlight success and drive action.
· Leadership Forum: When our research showed us that the strategy wasn’t penetrating past the top levels of the organization, Matha MacDonald created a communications vehicle to reach this previously untapped audience—future company leaders who were responsible for executing the plans.
· Leadership Forum Conference Calls: A series of conference calls, hosted by leaders of key strategic initiatives, educated mid-level managers about the issues facing the Truck Group and the actions under way to achieve business objectives. Participants were invited to submit questions prior to the calls to help determine call content. They also were invited to exchange in dialog with the host at the end of each call. A baseline survey followed by post-call assessments measured participants’ understanding.
· Frontline Employees: Matha MacDonald took every opportunity to reinforce messages with frontline employees.
· Business Education Program: Matha MacDonald designed an education program to equip local site leaders and communicators with an array of materials to help them build employee knowledge of market and business issues so that employees would have a context to understand and support Truck Group decisions. This information continues to be used as content for local newsletters and presentations, and as a way to prompt dialog in the plants.
· Editorial Board Visits: The group president met with newspaper editorial boards in the communities where Truck plants are located to reach employees via external vehicles, gaining third-party support for the actions under way.
· Employee Newsletters: Regular articles in corporate and site newsletters further educated employees about business issues, the necessary actions and progress.
· Face-to-Face Meetings: Designed as a way for top executives to connect personally with frontline employees, Matha MacDonald leveraged these existing meetings as yet another opportunity to communicate key messages, answer questions and motivate action.
· Quarterly Earnings Presentations: Matha MacDonald incorporated key messages into these all-employee meetings, delivered quarterly by top executives to inform the organization of the company’s financial status.
The depth and breadth of the efforts penetrated the entire Truck Group, achieving an organizational focus that previously was lacking. At the end of the first year of this two-year effort, Matha MacDonald made strong progress to achieve business results:
Matha MacDonald achieved alignment: Every member of the Truck Staff signed off on the message platform. Anecdotally, Matha MacDonald hears people throughout the organization incorporating elements of the platform into their own communications and conversations, indicating it has taken root and indeed become a mantra for the Truck Group.
Matha MacDonald earned credibility: In several qualitative surveys, a significant number of employees praised the group president and other top leaders for giving it straight to people.
Matha MacDonald raised understanding: A qualitative survey of Leadership Conference attendees said the straight talk and focus on the strategy were beneficial, and that they were clear on their post-conference accountabilities. In a separate quantitative survey, 100 percent of respondents have highest marks to the group president’s conference calls and Truck Performance newsletters as vehicles that helped them understand the issues facing the business. Also, based on pre- and post-call assessments, we elevated mid-level managers’ awareness of business issues: On average, 80 percent said the call content was valuable, and 76 percent they knew what they needed to do to achieve change.
Employees acted. Within five months, amid a continued downturn, the Truck Group met its financial targets for the first time in two years, when a comprehensive communications program was absent. Meantime, specific initiatives are ongoing—and on track to achieve their financial goals by 2004.