January 2010

An Important Message for the C-Suite

Business leaders need to adopt radically different expectations of their communication people.  Starting this morning!

How so?

As manufacturing, supply chain management, R&D and others did years ago, the communication discipline is going through a very healthy and positive transformation. They’re adopting lean and six sigma practices that dramatically improve the value of their work. Instead of being managed as a collection of activity that's expected to magically come together to serve a higher purpose (myth debunked), communication is being managed to attack root causes to real performance issues.

Cases in point.

Go to our new website at www.jimshaffergroup.com and you'll see a short video featuring how the ITT Corporate Communication team helped improve quality and on-time delivery during a lean transformation.

Later this Report you'll read about Dave Jackson, ConAgra Foods' manager of internal communication, who led an effort to improve safety and reduce rework at a company site.

Terry Simpson and her team at FedEx Express helped improve U.S. export sales by millions of dollars by improving communication among sales and operations people and by adjusting an incentive program to communicate the right things. The ROI was more than 1,500 percent.

Similar gains have been made by the communication functions at Sara Lee, Honeywell, Owens Corning and others.

What's going on here?

Simply put, today's communication management is more about producing value-adding outcomes than spewing out news, which often adds little to nothing to the stock price.

The new communication management weeds out root causes of communication breakdowns that hurt business performance.  And when the cost of the fix is less than the gain that it creates, there's an ROI.

Here are more examples.

• John in a Dallas sales office was losing customers—and revenues--because he couldn't get pricing information to his prospects to pass on to his customers before his competitors did. (Slow-moving communication.)
• Mary couldn't process insurance claims accurately or quickly enough to meet customer requirements because she hadn't received proper instructions on how to process claims. (Lack of communication.)
• A Denver sales force had a $76 million productivity shortfall in large part because it couldn't retrieve information about features, benefits and products in the pipeline. (Poor access to communication.)
• A Chicago bakery’s wrapping line was down constantly because Jose rarely knew the number of loaves produced up line in order to load the right amount of bags at his end. (Inaccurate communication.)
• A pharmaceutical couldn't shorten its new product development cycle and get medicines to market faster because of the internecine wars that existed among divisions and departments.  (Communication blockages.)

“But this isn’t what communication people do,” I hear you saying.  I agree.  But, there was a day when HR people only focused on personnel administration. They transformed themselves. Now the really great HR people are focused on building workforce capability while outsourcing many of the previous tasks.

Historically, communication people have been setting up webinars, producing videos and podcasts and writing brochures.  That work isn't necessarily going away, especially if it can be bundled in a way that adds value.  But in a lean six sigma world, the push is on to rid the organization of work that the customer isn't willing to pay for. The new work will produce value--the more the better.

Communication professionals have been feeling the push for some time.  But it's been accentuated during the current recession which hit communication departments hard. 

The good news for the C-Suite is that another function is upping its contribution to the operating and financial success of the enterprise.

The good news for the communication function is that it and its practitioners have huge opportunities to add more value to the business, to themselves and their careers.

But everything comes with a price. Recruiters tell me those practicing performance-based communication command as much as 50 per cent more in pay because of the ROI they're generating. "They pay for themselves and then some," a New York-based recruiter told me. "If you produce a $300,000 cost avoidance or improve on-time delivery by 25 percent, which in turn increases sales by a significant factor," that's worth paying more for especially if it's sustainable."

But, C-Suite, be prepared. This new breed doesn't represent the order-takers of the past. See my blog, "And do you want fries with that order?"

These folks are asking tough business questions.  They want facts and data to support what they do.  They're looking for root causes not easy fixes that don't make problems go away. They're viewing their world broadly while asking the relevant question: what's our business objective?  

Of course if you're a shareholder or customer, these are the right questions. But for CEO's who've always been able to get their little green brochures when they wanted them, nevermind the fact that they had no value, it might be unnerving. But then again, if someone had told John Thain at Merrell that wasn't in the best interests of the shareholders or customers to spend a gazillion dollars redecorating his office, things might have been better there, too.

"My god," a CEO told me about his director of corporate communication. "She starting to sound like an operations person, not a communication person." 

Heaven forfend!

Meet ConAgra's Dave Jackson: One of the New Breed of Communication Pros

Dave is one of the new communication professionals who practices in the world of performance-based communication management at ConAgra Foods.  In a five-month project during 2009, Dave and I worked with the leaders of the operation making Pam cooking spray to reduce accidents and re-work. Both objectives are on course to improve by 50 percent.

"As communication professionals, we have to realize our job is to help the business generate results," Dave says. And the closer you are to where the work gets done – operations, sales, customer service – the more opportunities you see to make a difference. I joined ConAgra Foods to work with a team that shares that philosophy.”

Courtney Reynolds: Helped ITT Improve Quality and Improve On-time Delivery in Texas

Courtney and I worked with a great group of ITT Corporation leaders to integrate the cultural and technical sides of lean in Lubbock, Texas.  Quality shot up 40 per cent.  On-time delivery increased from 70-95 per cent.

Check out a six-minute video that includes ITT’s CEO, Steve Loranger, an ITT customer offering a before-and-after testimonial and some of the excited, turned-on employees who made it all happen.

Getting Low Value-Added Work Stuff Off Your Plate

Before the holidays, a client asked how he could help his leadership team get work off their respective plates. “They say we adopt new initiative after new initiative but nothing ever goes away,” he said.

Sound familiar?

Peter Drucker said choosing what not to do was a decision as strategic as choosing what to do. He called “purposeful abandonment” the notion of quickly ending projects, policies and processes that had outlived their usefulness.

Here’s an exercise I suggested he use. It's proven to free up more than two hours per day for each leader who went through the process.   You have to be rigorous and disciplined, though; not wishy-washy or bow to sentimental favorites.  

Because you’re going to rate what you do based on how important it is, you need to agree on “important to what?” Our client picked his three strategic focus areas: new product introductions, increasing customer satisfaction and streamlining work processes.

Step 1: Make a list of all the tasks you undertake in a given week or month. (Looking back over your calendar can help you get started.) You can do this as individuals or in a team meeting. Estimate (roughly) how much time you spend per day, week or month on each task. Do this quickly; precision isn’t important.

Step 2: Rank order on a piece of paper all of the above tasks, starting with the most important and ending with the least important. Force yourself to accept that not everything is of equal importance and when two tasks seem of equal importance, force one over the other.

Step 3: Now identify the absolute most important tasks.  There should be no more than 3-5. Now identify the least important tasks.  If you stopped doing these tasks it would not affect your ability to achieve your objectives.

Step 4: You now have three buckets: high importance; low importance; medium importance (the ones left over from Step 3)

High and low importance tasks are easiest to deal with.

Commit to yourself that you will focus most of your time and energy on the Most Important Bucket.

Stop doing anything in the Low Importance Bucket unless it’s required by law.

The middle bucket often creates controversy because continuing to pursue or eliminate those tasks isn’t always that neat and tidy.  Typical considerations in the so-called middle-value list are to 1) shift the work to someone else at a lower cost 2) automate the work, 3) outsource the work, 4) reduce the time it takes to do the work.

Try it and see if you feel more productive at the end of the day.

New Website, New Blog

Our new website is up and running. We’ve designed it as a learning site—packed full of information, articles, opinion, references, reading lists, slide presentations and video to beef up your inventory of tools, processes, techniques, knowledge and skills to lead in 2010 and beyond. 

Enjoy and let us hear from you! 

Thanks to Steve Wolock at River Graphics and Anna Roach at WordTurner Productions for making this new website really cool.