The completion of financial restructuring for Marconi in May marked the end of a period of turbulence for everyone who works for the telecoms equipment manufacturer. Liam FitzPatrick, Head of Internal Communications reflects on some of the lessons learnt over the last twelve months.
In the last two years our people have been through a great deal. Marconi has gone from the heady optimistic days of the dot com boom to a business saddled with massive debt. The work force has shrunk from 56,000 to about 15,000 as the company shed businesses and assets in an attempt to cut costs and get control over cash flow in the face of fast falling demand from customers.
And for the last year, the company has been locked in negotiations with its creditors, to hammer out one of the largest financial restructurings in UK corporate history.
Against this background, staff have also had to cope with continual questioning from the media about the wisdom of the company's leadership, and unsettling speculation about the status of the negotiations with the creditors and their eventual plans for the business.
In addition, there have been a number of significant reorganisations to contend with as we battled to refocus around a core business that was sustainable and cash generative.
The challenge for management was to keep employees informed throughout this process and to maintain performance - in particular, to keep people focused on delivering the levels of customer service which consistently win praise from our customers. And in all this, there was a delicate balance to strike.
Marconi could not afford to allow messages to get ahead of reality. Its employees around the world are highly educated and well-informed people. They read newspapers and are active users of the internet - the company could not afford to present a picture that was too upbeat when employees were hearing the exact opposite from the media.
Yet you can not manage a business where such uncertainty is rife - and certainly not one where you are trying to introduce real change and manage a radical downsizing in a controlled and planned manner.
For the last year, the company has set about communications with a very simple approach - focus on getting the messages out to employees and explain what is going on in straightforward terms. In particular, CEO Mike Parton did not want communications to be anything but factual - there was a widespread desire inside the company to get away from the sort of messaging that had pervaded every organisation caught up in the excitement of the internet bubble years.
The company focused at first on explaining the complexity of the corporate finance issues. A lot of effort went into providing information about the overall debt for equity swap process as well as providing basic guides to financial terms.
In addition, Marconi developed a new template for explaining financial results to employees. As these often, in the course of the year, contained important internal news (such as announcements of further cost reductions), there was a clear need to provide this to employees at the same time as it reached the markets, but also to provide added internal context.
But posting the information centrally was not enough as it is axiomatic in all internal communications that people will always prefer to have an opportunity to discuss issues with their manager who can provide a degree of local interpretation.
Communications packs were therefore designed for use by line managers and the company also developed a system of phone briefings which did not compromise its obligations to the markets for sharing price sensitive information. Briefing packs tended to include a statement of key messages, PowerPoint slides and very detailed question and answer formulations.
All this may seem rather obvious to most communicators and human resource professionals. However, the reality was that in a fast changing environment, systems break down very quickly and it pays to focus on keeping simple systems running. For example, setting up a programme of factual briefings on the intranet was a necessary response in early in 2002 to the news that, following extensive reorganisations, over 50% of employees were confused about who was responsible for managing their departments.
The gathering of feedback through surveys was invaluable through this process. Because of feedback the company was able to invest energy in explaining organisational structures and to identify where messages were not getting through. A monthly sample survey proved a very useful investment and provided senior management with a robust barometer on how events were playing around the company.
An early lesson from the research was that as a result of the major change, many people were unclear about where they fitted in within the organisation. Many of people were actually saying they were unclear who their manager was. This prompted a major exercise to ensure that people were clear about the structures around them.
Another outcome of the surveying was a piece of detailed audience segmentation analysis. This looked at how attitudes towards the company were driven by different factors and painted a very interesting picture. It showed that although there was a vocal group of unhappy people in the company, they actually only represented about 20% of the total population. This plainly said that although it is tempting to be driven by the concerns of the most vocal groups, communication should not neglect silent loyalists or the less vocal "floating" employee.
This latter type - the undecided employee - emerged as having a couple of important characteristics. They were defined either by their attitudes to senior leaders or by their experience of local management. In effect, the analysis was saying that morale can be maintained for one group by building confidence in senior management, or for another by developing the quality of their immediate supervision. Both approaches informed the communication and people agenda.
The Survey was also useful for the verbatim comments which it collected from respondents. After a while it begin to ask specific questions to uncover what it was that made people proud to work for the company, or what would make them feel hopeful for the future. The responses to these guided the content for continuing communication.
Overall the things which seem to have worked well are the simplest things - articles in the intranet, emails from the chief executive or all-employee telephone conferences. In the present climate, the company has seen slower results from its new team briefing system and receives less favourable reactions from employees for communications which stray too far from the factual. On the day when the financial restructuring was completed, there was a marked resistance among staff to anything that smacked of celebration, or sounded as if it were indulging in the sort of grand-sounding rhetoric that had caused the company's problems in the first place.
Perhaps the biggest asset which the internal communications effort had was the chief executive and his robust attitude to the task of explaining what was happening to employees. He consistently resisted the desire which many leaders would have had to make heroic statements. Instead, he insisted on communications which were simple and straightforward.
If we were to face the same situation again, the advice would be revert to simple approaches and eschew plans with any complexity whatsoever. In a fast changing environment, one does not have the luxury of time to develop clever processes or systems or the space in which to refine them.
Throughout the year, Marconi's small internal communication team asked itself the question: "What is the simplest way of getting this information to everyone in the business?" Keeping that question front of mind prevented anyone getting too carried away.