Washington Mutual Senior Vice President for Internal Communication Rob Hallam and his 15-person planning team learned last October about company-wide budget cuts that would drastically affect the company's 16th annual “State of the Group” meeting just four months away. The theme: “It's About You: Vision, Responsibility and Spirit,” was a lock. The contracts were signed — 3,850 management-level executives would descend on the Anaheim, Calif., convention center for three days, beginning February 10, 2004.

Or would they?

A Corporate Mandate

Washington Mutual, headquartered in Seattle, is so well known that when Donald Trump's limo pulled into Times Square on the first episode of NBC's reality series, “The Apprentice,” a giant yellow WaMu billboard was framed behind him. But Washington Mutual has not always been a household name. Through the kind of ambitious acquisition and growth strategy that fueled the financial services industry in the last decade, it morphed from a small state bank with 2,000 employees 15 years ago to its current status as the sixth-largest financial institution holding company in the country, with 55,000 employees. Washington Mutual Inc. and its subsidiaries currently have consolidated assets of about $275 billion.

As the company grew, so did its annual State of the Group meeting, which added an exposition in 2003 and won Meeting Professionals International's Golden Paragon Award of Excellence (for best-themed event) that same year. When Chairman and CEO Kerry Killinger sent word to the troops in October 2003 that the company must cut $1 billion in hard and soft costs in order to stay competitive, the planning team had already spent eight months on initiatives (based on feedback from the 2003 meeting) to improve the content of the 2004 meeting. Now, they were faced with reshaping it.

Hallam began the process by embracing the cost-cutting rather than fighting it. “I went to my boss and suggested using the State of the Group meeting to set an example,” he says. “SOG had high brand value within the company. By changing SOG, the managers would know we were serious. The planning team subsequently offered a menu of options for trimming costs, up to and including canceling the entire meeting. Among the many ideas that were enacted:

  • Cancel a scheduled evening event at Disneyland and Disney's California Adventure. Savings: $500,000.

  • Eliminate WaMu's half day of divisional and breakout sessions. In 2003, these sessions, presented by external speakers whose presentation content was not adapted for WaMu, rated anywhere from popular to “total misses,” according to Hallam. “What they had in common was they weren't strategically aligned with the key presentation of the meeting.” Savings: $150,000.

  • Scrap a proposed “SOG Ambassadors” program that would have used lower-level employees (not attending SOG) as greeters for post-event rallies and meetings. Savings: $100,000.

  • Shrink the size of the meeting by including fewer back-office and corporate employees. Ultimately the original anticipated attendance of 3,850 shrank by 1,200 people, to 2,625.

  • Eliminate the professional development seminars. Combined with the elimination of the breakout sessions mentioned above, this trimmed the former three-day meeting to two days, cutting one-third of the cost.

  • Transport existing staging from WaMu financial centers to use at the meeting. The only stage set built from scratch was for the general session. Even that was fairly modest; no pyrotechnics of any kind. Savings: $25,000.

  • Develop the trade show with a Hollywood theme, enabling the re-use of signage and props. Savings: $20,000

  • Mandate online meeting registration. Savings: $20,000

  • Eliminate registration packets. Everything attendees needed to know — from the meeting agenda, to a convention center map, to a list of trade show vendors — was in their name badge holders. Savings: $15,000

  • Nix the expensive embossed briefcases that were given as gifts to attendees in the past. Instead, give them handy — if inexpensive — pens attached to their lanyards. Savings: $70,000

  • Replay a video purporting to be CEO Killinger and Consumer Group President Deanna Watson Oppenheimer running a lemonade stand that was originally produced for a SOG event several years ago. Savings: $20,000

Cumulatively, these steps took a $7.1 million budget and reduced it by $2 million — even with attrition charges. “We did eat some room nights,” Hallam admits. But, he adds, attention to detail during hotel contract negotiations kept attrition fees for unused guest rooms much lower than they could have been.

Meeting Strategic Goals

By trimming the meeting's fat, WaMu planners also eliminated potential distractions from the meeting's strategic message. Day one of the tightly structured 2004 SOG was a strategic Senior Leaders' meeting for 680 top executives. Roughly 1,585 branch and financial center managers arrived that evening for an opening reception and trade show. Day two for all attendees began with an opening general session that included speeches by WaMu CEO Killinger, Consumer Group President Deanna Oppenheimer, Commercial Group President Craig Chapman, and a presentation by comedian Wayne Brady. It was followed by an interactive training session on operational excellence, known as OpEx. The meeting ended with another general session that featured closing remarks by WaMu top brass and a presentation by Boston Philharmonic Orchestra conductor Benjamin Zander.

The planning team focused on four factors for the 2004 SOG:

PROJECT MANAGEMENT — including strategic alignment plan development and key performance indicators;

KEY MESSAGE DEVELOPMENT — including integration into the overall 2004 communication plan;

SOG THEME AND BRANDING — applied before, during, and after the meeting;

REALITY-CHECK TEAM — a small group of senior-level field and back-office managers who approved design, theme, and content.

In many ways, SOG was reinvented twice: once in the wake of feedback from the 2003 meeting, and then in response to the company's cost-cutting tear. One big change came about from negative response to inconsistent presentations least year. “This year we funneled all the speechwriting through one writer,” says Sara Moorehead, first vice president and senior communications business partner, who planned and managed the Senior Leaders' meeting. “That gave us repeat and complementary themes. It felt like one agenda instead of multiple agendas. [Last year] was a mess. [This year] we were a lot more focused and crisp and had a greater consistency of message. The objective was that people come out with a crystal clear understanding of what was going on in the organization and how to lead it where we need to go.”

A Productive Expo

One of the smoothest and possibly most productive aspects of Washington Mutual's SOG was its expanded exposition/cocktail party.

In a relaxed setting that included an open bar, a variety of gourmet pizzas and pastas from Wolfgang Puck, Asian appetizers, waiters circulating with fresh vanilla milkshakes, signs for Hollywood landmarks such as the Brown Derby and Schwab's, Charlie Chaplin and John Wayne lookalikes, and the chance to pose for photographs with cardboard cutouts of CEO Kerry Killinger, WaMu managers also found time (and motivation) to visit the 28 “strategic vendor” exhibit booths.

Vice President for Corporate Meeting Services Todd Zint enticed attendees to visit the booths by giving them a “traffic builder” brochure when they entered the expo door. It talked about each exhibitor and included a Bingo-like game piece. Each square had the exhibitor's name as well as its booth number. At each booth they visited, attendees received a stamp. Random door prizes valued between $500 and $2,500 were announced for people who turned in a completed card.

“The strategy was to have a balance of internal and external strategic vendor partners, all of whom directly affected the attendees through specific products or services used on the job,” says Zint, who was responsible for organizing and running the expo. “SOG has two audiences, the corporate back-office execs and the frontline branch managers and financial center managers. The vendors were mainly focused on the branch managers. It was an opportunity for vendors to share their latest initiatives, establish and strengthen relationships, and learn more about frontline success stories and frontline challenges.”

“Last year we had 15 exhibitors, but 10 of those were in-house bake sales,” says Hallam. “This time we greatly expanded to give our 28 strategic vendors exposure to our audience.” The planners also changed the business structure of the expo. In 2003, it consisted of sponsorship packages. In 2004 exhibitors were charged flat rates for booths: $8,000 for a 10-foot-by-10-foot booth; $16,000 for a 10-foot-by-20-foot booth; and $24,000 for a 20-foot-by-20-foot booth. There was no shortage of takers, among them American Express Travelers Cheques and Prepaid Services, Corporate Express, EDS, IBM, JD Power and Associates, MCI, Microsoft, and Unisys. Booth fees were based on a cost-recovery model determined by calculating the actual exposition and attendee reception costs.

“This is going to be a new trend [in corporate exhibits] because it's revenue generating,” says Zint. We did this one on a cost-recovery basis but we could have made a lot of money if we pushed it out to more vendors. Other companies do this and say to their vendors, ‘Whoever shows up, great.’ What's different here is that there was a predetermined criterion for exhibitors to take part. This was a targeted strategy that paid off.”

Richard Brof, a WaMu branch manager from Manhattan, was pleased with the exhibition. “I think it's great they have all the vendors here,” he said during the event. “We're bombarded by information every day. This way we get to talk to people face-to-face. They're giving me ideas and lots of information that I'll read in my hotel room or on the plane home.”

“We made a little bit of money off the exposition, but not a huge amount,” notes Hallam. “The goal was to give vendors more exposure to employees. We told vendors about the theme of our meeting so in many cases they incorporated similar messages into their booths. That way our managers could see how these vendors are helping us accomplish our goals for the year.”

Brain Typhooning

The interactive training experience known as OpEx was designed to increase peer interaction and networking, while providing managers with critical problem-solving skills. It took place in an enormous semidarkened room with 334 numbered, color-coded round tables, each with assigned seating for eight and a single laptop computer. At one end of the room, raised above the fray, was a bank of supercomputers that would instantly process wireless data received from the tables. A stage where a male and female moderator managed the crowd was set up in the center of the room, theater-in-the-round style. There were eight overhead video screens and four wide-screens at eye level around the stage. Roaming coordinators in white shirts and blue hats were each responsible for 10 tables, or 80 people.

Participants were told they were involved in a new form of brainstorming called brain typhooning. They were given a series of questions and challenges — such as “How can we answer customer questions at the lowest possible price?” — that called for creative responses. The goal was to stimulate innovative thought on site and, more importantly, back in the home branches and offices. Ideas flowed, 1,051 solutions were collected, and the top 10 were distilled by moderators and shared with attendees.

“People got it,” Hallam says. “It scored high on comprehension [in the post-meeting research]. The important challenge now is whether they follow through.”

Ken Bishop, a WaMu financial center manager from Chico, Calif., gave OpEx a rave. “It was a quick, easy way to get ideas on the table and see some things happen,” he said. “No offense to the talking heads, but I can read [their comments] in an e-mail. OpEx helped us share ideas.”

The presentation was less than flawless, however. Moderators took too long getting to the point and tended to speak down to their audience. “People either loved it or hated it. There wasn't any middle of the road,” says Corby Casler, vice president, internal communications.

Tone Down the Glitz, Up the Inspiration

Casler was responsible for executing the opening and closing general sessions on SOG's second day. Her biggest challenge, she says, was to “tone down the glitz but not the inspiration.” In years past, SOG gave many of its top execs a speaking role. “This year we had only our top three and it worked well,” Casler notes. “Kerry Killinger [CEO], Deanna Oppenheimer [president, consumer group], and Craig Chapman [president, commercial group and chief administrative officer] are the three senior-most people in the company. They're the ones people respond to.”

With money tight, Casler hired comedian Wayne Brady as the general session's opening act. “He's up-and-coming but not as expensive as Bill Cosby,” she says. “It was our idea to use improv. Instead of role-playing, we encourage humor. We want people to lighten up. We previously [used] improv for our training. That's where the idea came from for this. [We wanted to] teach people to use improv to think on their feet.”

For the closing general session, she made an equally inspired choice with Benjamin Zander, conductor of the Boston Philharmonic Orchestra. “Zander is a great inspirational speaker, but not widely known,” Casler said. “And attendees didn't instantly understand the concept of an orchestra conductor bringing us all together to play as a team. But the metaphor really worked and we didn't have to spend a lot of money.”

It also didn't escape her notice that CEO Killinger has a passion for music. “We wanted to do something that he would get engaged in,” she says. “We knew that if he felt it, the crowd would, too.” Killinger retook the stage at the end of the closing session and played his saxophone to resounding cheers.

Casler made a point of showing the company's top three execs videotapes of Brady and Zander a month prior to SOG to get them excited. “It worked,” she said. “They thought it was one of the best SOGs ever. They felt ownership because they were part of the process.”

The CEO Speaks

When Washington Mutual CEO Kerry Killinger came out onstage and kicked off WaMu's senior leadership meeting for 680 attendees on day one of the 2004 State of the Group event, he came out guns blazing. “My focus is on our challenges rather than our accomplishments,” he said, quickly getting down to the hard realities. While his managers were already four months into the goal of reducing $1 billion in non-interest expenses, he re-emphasized the mandate. “We're a $275 billion racehorse pulling a $1 billion plow,” Killinger analogized. “By the middle of 2005, we need to reflect that $1 billion in savings. This is NOT an option. … We'll do what we must to get there. It's going to take leadership, yours and mine, to make that happen.”

At that point, a slide flashed up on a screen behind Killinger. It showed a fork in a road, a point where WaMulians, as he called them, must decide which road to travel. To the left, all signs led to mediocrity. To the right, “Nation's Top-Tier Player” — Killinger's goal.

When he took the stage on day two for the opening general session in front of an additional 1,585 branch managers, Killinger's tone was less somber, but no less focused on the bottom line.

“I say to our competitors, ‘Bring it on!’” he belted to the cheering audience. “Through the collective efforts of every individual in this room, we're going to blow the competition away!”

Odds 'n' Ends

Odds 'n' ends from Washington Mutual's State of the Group post-meeting analysis:

  • One-third of WaMu's managers were booked into the Disneyland Hotel. Mickey Mouse was literally in their faces, so Senior Vice President for Internal Communication Rob Hallam expected some people might be upset at being so close to the theme park without actually getting in on the company dime. But attendees were surprisingly understanding. “One person said, ‘It would be nice if we could do the Disney thing again,’” Hallam reports. “Another said, ‘With the cuts, we understand why you didn't do that.’”

  • Buffet lines for one luncheon didn't work. “I would do it differently next time,” says Hallam. “It got really backed up. A number of people suggested we should have had box lunches.”

  • Hallam was concerned attendees would think the Hollywood theme at the trade show was overdone, considering the cost controls in the company. But, “nobody said that. We had a nice Latin band; none of it was over the top. All the props were rented, not created just for us.”

Eye-Opening Improv

The opening general session at Washington Mutual's State of the Group meeting featured comedian and TV talk show host Wayne Brady, who led attendees through a lively, instructive session on using improvisational skills while providing customer service in the company's branches. “Set up situations and improvise around it, have fun,” he advised. “If you don't enjoy what you're doing, you shouldn't be doing it.” Accompanied by a live rock band, Brady improvised several songs with financial services terms, set to the tunes of popular songs. At the end, he said, “See? We can handle anything.”