Using communication skills effectively

I continue to be amazed at the disparity between the communication and PR skills of the "Big Three" automakers and their soon to be overlords, the US Congress.  In a matter of a few weeks, the CEOs of the Big Three have moved from the titans of industry to the corporate "yes men" of the house and senate, mostly because they did not understand the magnitude of their own problems, nor how to effectively manage the stream of communications.

To say that the CEOs are tone deaf is probably an understatement, and politicians of course know much more about communicating, especially to the broad public audience, than business people do for the most part.  However, it has really been shocking how well the politicians have framed the debate about the auto bailout and how poorly the CEOs and their communication staff have responded or attempted to proactively frame the debate.

For example, if you are going to come to Congress and ask for a significant infusion of funds, don't you think you should come prepared to support the rationale for those funds and the changes in the business that will occur because of that investment?  Congress WANTS to keep the Big Three solvent.  They don't want to see any one of the Big Three to proceed to bankruptcy or liquidation, yet they have to demonstrate to the public that they are being good stewards of the public money.  So the first time around the CEOs were unprepared and were sent home to do their homework.

In the mean time, leading politicians have ratcheted up the noise about the disaster if any one of these firms goes under.  What Schumpeter and others called creative destruction, we now call unavoidable.  I wonder if AMC would like to get back into the automobile business....  At any rate, what the politicians are doing is building a case and awareness for the fact that they will fund SOMETHING to keep the Big Three alive.  The alternative, they state, is simply too drastic to contemplate.  Nancy Pelosi, Speaker of the House, went so far as to say "bankruptcy is off the table".  That's probably going to be decided by creditors and shareholders, not Nancy Pelosi, but you get the drift. 

The CEOs of the Big Three, meanwhile, have done a terrible job building their case for the funds or for any investment.  Clearly the Big Three and their supply chains employ a significant number of people, but we can't simply fund business practices, designs and products that weren't being purchased before the downturn.  Something has to change, and the Big Three need to start moving and admit that.  Otherwise, what will happen next is that Congressman X from Y state will rise and say that while he is behind the auto bailout, he is "concerned" about any job losses in his state.  So the Big Three will then have to win his support or risk losing it to make the business decisions that are necessary.  Pretty soon all the senators and congressmen will weigh in on potential job losses, tying the hands of the CEOs who need to redesign their products and restructure their businesses.

The best plan for the Big Three would be to come out directly with a very credible plan for drastic change, like ripping a band-aid off all at once.  There has to be a dramatic restructuring, and it is going to cost jobs.  Let's go ahead and get that on the table.  That pre-emptive move will reduce the ability of Congress to trim the plans and protect plants and jobs.  A credible plan, presented now and well communicated, is the last, best hope for these guys.  Otherwise they may as well turn over the management of their firms to Congress.

This inability to communicate or even understand the thinking of the congress and the public at large is really astonishing.  Who do these CEOs talk to?  Who gives them information?  Are they so removed from the public that they can't see the dire need for excellent, clear communication about their plans?

Comments

[Martin Haworth]

I continue to be astounded at the difference some senior executives show in how they communicate with the outside world (not to mention their own people).

Sometimes it's like they were off sick on the day that 'real world' chip was fitted to their brain,

Regards

Martin Haworth