THE NEED FOR COMMUNICATION IN TURBULENT TIMES What Happens When The Music Stops? An interview with Tom Renda, principal, Mercer Management Consulting, Boston, MA

Companies that ask their employees to participate directly in major changes are missing the mark, says consultant Tom Renda. In successful corporate change programs, "the pursuit of results dominates the pursuit of employee inclusion," according to Renda, a principal in Boston, MA-based Mercer Management Consulting. He calls this process "rational involvement," a hard-headed, goal-driven approach to employee participation.

Of the several elements of rational involvement, none is more important than communication. Employees who don't take part directly in a major change must be involved through a communication program. As Renda says, no corporate change--regardless of the form it takes--can be complete until everyone in the company knows what to do, why it needs to be done, and how to do it.

"Communication is one of the vehicles by which people in the organization can be involved in the change process," Renda says. "Yet far too many high-impact change efforts are trying to involve too many people directly, frustrating people and not getting the job done."

Renda believes a communication program is as strategic an element as "deciding what markets to enter, what products to sell, or what information technology to use." Communication should also be one of the "cornerstone responsibilities" of corporate leaders.

Companies should start with a statement on the need for change and continue their communication until the transition is complete. A communications program might include "town meetings" conducted throughout the change in which the senior leadership "engages groups of people in discussions about the reasons for even undertaking a change," says Renda.

Broad-based town meetings can be supplemented by letters and memos sent to all employees, and, as specific change projects progress to the details, managers and supervisors might hold brown bag departmental lunches to keep employees informed.

"The program stops when you think you have the change installed. However, if the company has done it right, it's likely it has institutionalized the whole concept of communication. In that respect, the program never ends."

A key part of a communications program should include a mechanism for employee feedback, Renda adds. If a town meeting is part of the program, then someone should be designated to record all comments and questions. Written

communications should invite employees to respond and provide a way for them to do so.

Renda adds a word of caution regarding feedback: "Don't make it look like, sound like, or taste like you're inviting the entire organization to have an impact, to play a concrete role in a democratic situation," he says. "That would be so impractical as to be absurd.

"What you really want to do with a high-impact change is put employees in the position of helping with incremental change; taking what comes down from the highest level and applying it to the day-to-day operations."

It's a particularly damaging example of Murphy's Law: When a company most needs its employees' strongest performance--during a major change--is exactly when their commitment is often weakest.

"Change takes no prisoners" is how consultant and author Price Pritchett puts it. "It just happens, and, as in a card game, some win, some lose, and some break even. It becomes a matter of how well you can adapt."

For companies, that means learning how to build a "burning level of job commitment" among employees, says Pritchett, chairman and CEO of Dallas-based Pritchett & Associates.

Pritchett advises companies to forget about fostering employee loyalty when conditions these days place severe limits on the level of loyalty a company can return. Discard, too, the goal of high morale, an unrealistic target given the stress accompanying change, and one which also may not matter much in terms of performance, he says.

What does matter is commitment, which "works a lot harder than loyalty and gets more done than morale," according to Pritchett. "Committed individuals are those whose energies are invested in their work, who are intent on delivering meaningful results," Pritchett says. "High commitment doesn't mean a person burns him or herself out. It means caring about what you are doing and what the results are."

Pritchett has devised a set of guidelines for building commitment during change. The first is for managers to be passionate about their own jobs. "If I am lukewarm as a leader, it is absurd for me to think my people will really throw themselves into their work," says Pritchett.

Making membership in the corporate group hard to come by also fosters a fierce commitment in employees, especially during a change when people are repositioned and shuffled around, often ending up in jobs they never even applied for.

"If we select people carelessly, we end up with a crew that is not likely to have much of an investment in their jobs," Pritchett says.

He points to the Marines, the Navy Seals, and other elite groups where membership involves meeting rigorous standards, making sacrifices, or going through some type of initiation rite that fosters an emotional bond with the organization. These factors turn membership into a privilege and promote a common bond among those employees who have attained it.

Another way to develop commitment is to give employees responsibility for results. During a change, people often feel busier than ever but there's actually a dip in productivity.

"When you give an individual responsibility you trigger a peculiar psychological response. People want to justify the trust placed in their ability. Conversely, if you make their load of responsibility lighter, you can bet that will dilute their commitment level."

Commitment always runs deeper when employees care about coworkers, but working relationships are often disturbed by a change. "The connective tissue" among employees, as Pritchett calls it, is also being strained by the way we work today: electronic connections, home offices, outsourcing.

Companies can rebuild commitment by creating occasions for personal bonding. Getting together socially after work hours, for instance, develops a cohesiveness among employees that intensifies commitment to both the group and the

company.

"The actual face to face promotes a bonding you can't get anywhere else," says Pritchett.

Mergers, downsizing, reengineering. About the only constant in today's corporate world is change. The companies that succeed in this new reality will have at their helm individuals who recognize a fundamental change in their roles as leaders, says David Noer, management consultant, author, and senior fellow at the Greensboro, NC-based Center for Creative Leadership.

"The role of a leader now is to facilitate change," says Noer, whose perspective on leadership comes from first-hand experience on the firing line of corporate change. As the former president of a large division of a computer company, Noer presided over a mammoth downsizing. At the time, he was close to completing his doctoral dissertation (for a business administration doctorate) on the effects of downsizing on those who remain in the organization.

"What I learned is that the old concepts of leadership don't fit the new world. Under the old paradigm, you signed up for life; you fit in with the organization. Your goal was to stay for a 30-, 40- or 50-year career, and the organization took care of you."

These ideas on loyalty, job security, commitment, and motivation were part of an old "psychological contract" that must now be discarded, according to Noer. Yet many corporate leaders still haven't caught on.

"They don't understand that what got them there isn't what will keep them there now," he says. For today's corporate leaders then, "the first transition they need to facilitate is their own."

Noer's primer on corporate leadership focuses on three key areas:

* Intrapersonal insight--involves a leader's effort to learn about his or her own motivations, needs, and vulnerabilities. Most senior executives, says Noer, are "feedback starved; people never tell them the exact truth." A new tool for intrapersonal insight is "360-degree feedback," in which leaders discuss how they see themselves, then their superiors, direct reports, and colleagues are asked to relate their views of the leader. "The idea is to come up with a whole set of mirrors to hold up to the leader; it gives people a sense of the gap between their self-perception and what others see," says Noer.

* Interpersonal competency--relates to how a leader acts as a facilitator or coach in helping others to do their jobs. "True leaders have to work with other individuals without using coercive methods," Noer says. The emphasis in much of this training involves teambuilding exercises and developing a group purpose.

* Facilitating collective learning--involves developing the so-called "learning organization," an organization which itself has the capacity to learn from its environment. Says Noer: "A learning organization tends to have collective decision-making, not individual decision-making. This means that you don't have a leader you deify when the organization does well or trash when it fails. What we're groping with is understanding that leadership is a shared process."

When the Outboard Marine Corp. (OMC), a leading manufacturer of marine engines and boats, last year launched a major reengineering in response to a decline in sales, a top priority was getting the message across to its 8,500 employees worldwide.

The goal of the change was to transform OMC (whose products include Johnson and Evinrude outboard motors and fishing, aluminum, and recreational boats, including the Chris Craft, Four Winns, Stratos, and Grumman brands) from a cost- and engineering-driven company to a market-driven company; from one that is "internally focused" to one "more sensitive and responsive to our customers around the world," according to Chairman, President, and CEO Harry Bowman. Twenty of the top 36 positions in OMC's management team are now occupied by new managers, ten of whom joined the company in 1996.

Clark Vitulli, one of those new executives, joined OMC in the spring of 1996 to head its Nashville, TN-based Boat Group. No stranger to change, Vitulli spent 21 years with Chrysler--including the Iacocca years--and another four at Mazda.

A critical part of Vitulli's efforts has been communicating the restructuring to the Boat Group's 3,500 employees. He started by personally meeting with employees at several of the group's eight assembly plants around the country. "We held lunches and barbecues. They needed to see me not as a threat but as a new leader informing them of how the company is doing," Vitulli says. "In that way you build credibility and rapport."

Following this contact, meetings were held at each assembly plant to discuss business issues and the need for change. The meetings included a 15-minute presentation on the restructuring, with a video featuring Vitulli explaining the changes, and a Q & A session with employees.

Employees also received a letter detailing the hard data on the restructuring. "The letter gives people the hard information; that's where you're making sure things are communicated correctly," Vitulli says. "The meeting supplies the visual element: the mood, tone, personal touch. Meetings are absolutely critical. You can have a great reengineering on paper, but it's nothing if it's not communicated effectively."

Another new OMC executive views his department as a "change agent" for the company as a whole. Ed Frandle, CIO and vice president of information technology, joined OMC six months ago with the responsibility for creating a new global information network.

"Part of my vision is for my department to become a change agent," says Frandle. "That's a natural role for information technology, which moves across all corporate lines, enables an organization to transform itself, and creates a standardized system giving everyone in the company a common vocabulary. My group supports the entire organization, so my people can become leaders for change."

Critical to information technology's role in the change process--and indeed to all of OMC--is training, says Frandle. With the start of its 1996 fiscal year, OMC allocated more money toward training than it has ever before.

"Education is so important, but typically it is one of the first things to go," he says. "Companies recognize training as a long-term value, but under short-term duress, many will kill it. If you're building a company for the future, you have to realize you have only two resources: facilities and people."

Training has averaged three days a month for each of Frandle's staff of 100, located in Australia, Hong Kong, and Europe, as well as in the U.S. The training consists of a series of "soft skills" such as communication, listening, and giving and receiving feedback, plus meeting and agenda skills, including how to resolve conflicts during meetings.

Another component of the training addresses the "People Driven Quality" (PDQ) initiative, OMC's new company-wide quality management system. PDQ training gives employees a "framework for making improvements and starting new projects," says Frandle.

The training, meetings, and communications will continue in the information technology department--and throughout OMC--long after the reengineering. As Frandle puts it: "I want everyone to hear the same message and move to the same plain. If that doesn't happen, I will have stragglers, and those are the people who stand in the way of change."

1) Strategic Thinking: Leadership and the Management of Change, John Hendy et al. (John Wiley & Sons, 1997)

2) Change at Work, Peter Capelli et al. (Oxford University Press, 1997)

3) The Four Levers of Corporate Change, Peter Brill et al. (American Management Association, 1997)

4) Winning Through Innovation: A Practical Guide to Leading Change and Renewal, Michael L. Tushman et al. (Harvard Business School Press, 1997)

5) Why Change Doesn't Work: Why Initiatives Go Wrong and How to Try Again--and Succeed, Harvey Robbins et al. (Petersons, 1997)

6) Communicating Corporate Change: A Practical Guide to Communication and Strategy, Bill Quirke (McGraw-Hill, 1996)

7) Designing for Change: A Guide to Business Transformation, Colin Bainbridge (John Wiley & Sons, 1996)

8) Feeling Lost at Work: Understanding the Impact of Corporate Change on Your Life, Renee Michler (Media Futura, 1996)

9) The Change Management Handbook: A Road Map to Corporate Transform-ation, Lance A. Berger et al. (Irwin Professional Publishing, 1993)

10) Developing Corporate Character: How to Successfully Change an Organ-ization Without Destroying It, Alan L. Wilkins (Jossey-Bass, 1989)