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Don Yap M.A., Ph. D.
Business Analysis by: Bryan Christian “Bryce” Caluag Oliveros
Table of Contents
I. II. III. IV. V. VI. VII.
Executive Summary Problem Statement Data Analysis Criteria for Decision Alternative Analysis Recommendation Next Action Plan & Implementation
3 4 5 6 6 11 12
EXECUTIVE SUMMARY As a student of Marketing Management, this is a case study for the class on Seminar on Corporate Communication whereby after reporting and discussing the importance of internal communication and the changing environment, a case analysis is given in application of the concepts learned and exercise on being an effective decision maker. The Case is on Westwood Publishing on being able to organize and implement the most effective way of disseminating sensitive information on the voluntary severance and early retirement program for its employees as a means of cutting cost and one of the firm’s strategic plans on consolidating on the changing demands of the industry to allow the firm to sustain its competitive advantage. After analyzing and identifying the problem, the recommendations shall be addressed on improving the internal communication program in the firm. The recommendation will also bring about the most effective way of communicating information about the voluntary severance and early retirement packages that require a careful strategy as it may cause demoralization of the firm’s employees. The goal/s of the case study is to be able to objectively address the problem and answer the following guide questions: 1. Create a strategy for communicating change at Westwood Publishing that can be recommended to the CEO. 2. How do changes in the workforce affect how the director for employee relations ought to think about communicating the new policy? 3. What advice would you give to the director for employee relations about how communications to employees are structured at Westwood?
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PROBLEM STATEMENT The general problem of the firm is how to effectively communicate a Voluntary Severance Package and Early Retirement Package for senior mangers approaching 60 years old with out having a negative impact on the employees given that in the same industry competitors have had trimmed down their workforces repeatedly due to the evolving business environment. With the general problem stated, one of the challenges for the firm is that the prime candidate for the packages mentioned involves Eric Ridgway Vice President of corporate communication. The firm has done its part to always put employees first but due to the changing business environment the question of business sustainability and competitive advantage is challenged where key decisions are required to stir the firm into success in the evolving business requirements. Due to a sensitive issue that the management needs to face, the impact of the changes should be addressed effectively by the Director of employee relations to avoid negative impact on the firm’s human resources since the destabilization may affect the productivity of the firm’s employees as well as increase rate in employee turnover due to issues of management’s integrity whereby there was a prior statement by the CEO Linda Bosworth that implies the firm gives much importance to its employees and no lay-offs shall be implemented.
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DATA ANAYSIS Nature of the Company Westwood Publishing is a multi-million dollar trade magazine publisher with hundreds of titles and a broad subscriber base; the company was established in 1990 founded by Linda Bosworth the CEO. People or Persons involved. 1. Linda Bosworth – CEO of Westwood Publishing 2. Catherine Callahan – Vice President of Human Resources 3. Eric Ridgway – Vice President of Corporate Communication, prime candidate for the packages mentioned 4. Dan Cassidy – Director of employee relations 5. Craig Stevens – Outside Public Relations Consultant Background of Problem The company operating for more than ten (10) years has come to the point where in a need to consolidate with the publishing industry in terms of changes in the business environment has been seen relevant. The impacts of dot com companies show evidences of a need to reform business strategies to allow sustainability. Other competing companies have resorted to trimming their work forces. Based on the details provided, as the firm continuously grows, younger employees whom are holders of a Masters in Business Administration emerge as more competitive choices in the work force. Another point of consideration is that, strategically due to the corporate evolution, some business functions are deemed strategic to integrate with other functions to maximize human resources and reduce costs on futile business functions. In this case, one of the criteria to be considered is maximizing the public relation services of Craig Stevens to handle Corporate Communication for the company and Eric Ridgway the vice president for corporate communications is a prime candidate for the Voluntary Severance and Early Retirement program with the assumptions that Ridgway satisfies the criteria for the packages such as: less than excellent performance appraisals for two (2) consecutive years. Based on the information given in terms of the work experience of Ridgway his strengths is in the publication of news spreadsheets and not with trade magazine business which is Westwood’s primary subscriber base. The fact that Ridgway has been part of the company since start up becomes a challenge to the CEO, vice president of human resources and more over to Cassidy, the director of employee relations where recommendations on the best action plan shall be the conclusion of this case analysis. Bryan Christian “Bryce” Caluag-Oliveros // Case Analysis for Seminar on Corporate Communication Page 5 of 13
Present Communication Audit Based on the information provided in the case study, Westwood Publishing has minimal public relations professionals handling its communication efforts however other communication functions such as internal communication and investor relations were housed in appropriate functional areas. In some firms, it sees the importance of integrating the communication functions into one department to provide continuity most often with the corporate communication function. Taking into reference the details of the case an assumption is made where there is deficiency in the corporate communication area which should be the responsibility of Ridgway. Internal Communication function is handled by the Human Resource which was delegated to Dan Cassidy the director of employee relation Cassidy’s report to Catherine Callahan the vice president of human resources. They are responsible to conduct an internal communication program during the implementation of the voluntary severance and early retirement program. Another point of consideration for the current established communication framework, there is evidence that the firm has a good communication line with the employees based from facts where in the firm has always valued its employees where in, upon its establishment, no lay offs where made compared to other players in the industry despite the volatile business environment in 2003. Based on the facts provided, and open line between the CEO was stated in a speech made by Bostworth declaring that employees are important to the firm. Now this has an impact in terms of communicating the proposed package where in the management would need to gain the employees’ trust and understanding and not question the integrity of management where it can not be avoided that some may bring up such statement released by the CEO. This maybe a supporting factor why the CEO would rather have Cassidy face the individuals involved as it is understandable how the CEO feels about the management’s decision which is really a challenge but decisions as such are crucial to the firm’s sustainability and competitive advantage. Communication medium however where not stated. Effect vs. Opportunity of the Program Assumptive Effects of the Program 1. The employees can easily perceive the voluntary severance and early retirement program as an indirect way of communicating that the company is going through layoffs. 2. Employees could question management’s integrity using prior statements released by Bostworth Bryan Christian “Bryce” Caluag-Oliveros // Case Analysis for Seminar on Corporate Communication Page 6 of 13
3. As fast as information on corporate layoffs spread through the company grapevine the initial reaction is instilling fear, affect morale which results to lower productivity 4. Loss of trust and confidence of employees to the firm’s credibility which may lead to high turnover rate and result to affect the company’s reputation to other potential talents. 5. Formation of groups against management. Assumptive Opportunities of the Program 1. Consolidating the firm with the industry changes builds a stronger company to remain competitive and lowers the risk. 2. Restructuring the management team allows the firm to effectively cut cost and improve the efficiency of the operations 3. Restructuring the management also allows growth of some employees 4. It will allow the individuals affected to retire early and start up a completely new career or encourage career growth in other companies after being able to impart professional experience to the affected employees. Mechanics of the Voluntary Severance and Early Retirement Program With the facts given, evidence show the company values its employees where the firm has no history of layoffs amidst the volatility of the industry. A strong corporate culture and unity became one of the strength of the company that could have even led the firm to success, however in an objective point of consideration, as the company grows and industry changes, challenges arise and newer demands become a requisite for sustainability and competitive advantage. The strength in the employee relations can be used as an emotional hook in the communication program to be implemented. Although the program may seem as an indirect way of a layoff, a choice is given to the people that will fall under the criteria of the program. The delicate part is although the program is “voluntary,” supervisors are responsible to identify candidates. Even in moves to restructure the company, a choice is given to its employees because the firm perceives them as assets but just as assets may be classified as good and bad assets. As to Objectives of the Voluntary Severance & Early Retirement Program As the business is growing, to enable a more corporate competitive advantage, business analysts prefer young professional managers considering that the nature of the business is in the trade of publication magazines. Based on the information given, a bulk of the senior management is represented by the original group of employees in their mid 50s. A corporate restructuring is always a good and effective way to follow up a change in the senior management. Criteria for Nominees Bryan Christian “Bryce” Caluag-Oliveros // Case Analysis for Seminar on Corporate Communication Page 7 of 13
1. Vice president approaching 60 years of age. 2. Less than excellent performance appraisals for two (2) consecutive years. Communication Strategy 1. Callahan and Cassidy need to create action plans on how to effectively approach the problem where it will lower risks and ensure all possible negative effects are minimized if not avoided by conducting a communication audit before the release of information. 2. After a communication audit, the management should engage into an internal communication effort that will create a win-win situation for all the people involved.
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KEY DECISION CRITERIA 1. Minimal negative impact of the release of the Voluntary Severance and Early Retirement Program. 2. Consistency of the company’s mission, vision, and objectives 3. Most effective communication channel 4. Protection of the firm’s identity, image and reputation 5. Involvement of the employees in the final decision 6. Maximizing or integrating other job functions that increase or maintain productivity. ALTERNATIVE ANALYSIS After reviewing the case, and being able to consider the fact that there is an existing communication effort where Bosworth, the CEO made sure that the message delivered is that the organization values its employees, Callahan and Cassidy can work around this strength. In this case the only option is to be able to run a successful internal communication effort that will minimize the negative effects therefore timing plays a vital role Timing There are various options for timing of announcing and/or launching the program. Based on the facts given the implementation seems to be lined of for the following week where preparation is needed to strategically confront the problem. Cassidy and Callahan should organize an internal communication effort first Determine how long it will take to prepare for an internal communication program to ensure that the launching of the packages will not cause much business disturbance.
Communication Channels in Consideration Important key factors in internal communication program is to make sure to motivate the employees and create a two-way communication line to avoid alienating the employees while measures are implemented to decrease the work force and restructure the management team to a more effective core group. Cassidy’s recommendation is for the Bosworth to personally tell Eric Ridgway about the firm’s consideration to make him one of the nominees for the Early Retirement Program. The solution/s is upon the internal press release on the launching of the program, a video of Bostworth with an address about the slight changes the organization would have to take shall also be released. Bryan Christian “Bryce” Caluag-Oliveros // Case Analysis for Seminar on Corporate Communication Page 9 of 13
Along with the use of visuals, another communication channel to be used is to launch an intranet campaign with the information about the package integrated with an email blast to the employees on the criteria for the selection process. Once the information is disseminated, teams shall be called for in the conference room or any assembly hall to have a face-to-face meeting and open-forum discussion to be lead by the director for Employee Relation where a video of the CEO address about the issue stating that as much as she would want to personally announce that the company will be going through some changes however an assurance that it will be towards a stronger and sustainable company keeping the focus that the company values its employees. Once this is all done the hard part is the call from HR for the candidates or nominees for the packages wherein in complete transparency, it will still be the option of the person involved whether they will accept the package or not. After all the program as been implemented, a possible scare of any company layoff might still be in threat, the newly restructured senior management should run another communication program this time to motivate and reassure its remaining employees also through internal branding campaigns as well as a printing of a corporate publication highlighting the corporate milestones which are to be sent to the home addresses of the employee which again are integrated into the intranet.
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RECOMMENDATIONS The recommendation for the case is that being able to effectively communicate first with the employees upon launching of the program to keep them informed and open lines of communication. This will avoid company grapevine communication that can instill worry, fear or demoralization. Second, the firm should build on the fact that for years, they have never resorted to laying off its employees and even at the point of launching the program they are not resorting to a mass layoff but a diligent performance appraisals to review its human resources and give them an option whether they would want to commit to improve performance, otherwise be offered a good financial package and an opportunity for career growth else were. Although, to be nominated can be deemed demoralizing, if the firm envisions an excellent and sustainable business entity, employees should be aligned with the firm that the inability to meet the standards is a ground to be nominated for the packages. On the other hand for the senior managers, the early retirement packages for them are to be able to live a full life. The company should promote that they value their employees where at that point in the senior manager approaching 60, they are given an opportunity to either do something else such as investments and pass on the leadership to younger men and women. For both employees who fall in both criteria for nomination, should be informed in a proper way. Regarding the decline of their performance and the possibilities that it could be due to the changing environment and that simply means that the senior executives would take into consideration that the company is a magazine publisher that cater to younger subscription base so they need to research and understand the market. During the whole process an open line of communication should be present and at the same time the company should make uphold its integrity to make sure that they will be true to its word that the severance and early retirement package is a voluntary choice.
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ACTION AND IMPLEMENTATION PLAN Next Action Plans: 1. Callahan and Cassidy should prepare the internal communication materials prior to the launch of the package. Materials are as follows: Online Press Release in the intranet that is interactive where anonymous comments maybe posted An Email blast of the program being launched and schedule of meetings A scheduled assembly to be facilitated by Cassidy 2. On the launch date, time line of activities are as follows Publishing of the online press release on the intranet before start of the business day An email blast to all the employees before start of business day. Around 10am a general assembly will be called to be facilitated by the director of employee relation where the presentation of the program and the extensive explanation of the program shall be done. Followed by an open-forum 3. After the dissemination of the information, nominees will one by one receive a call from Human Resource’s Callahan for a meeting and presentation of materials and offering of package and negotiations. 4. After the implementation of the Voluntary Severance and Early Retirement Program. Another internal communication program with the following programs: Release of Corporate Strategies from the restructured senior management to be published in the intranet and printed on the company publication Internal branding campaigns through corporate give away (key chains, pens, bookmarks, mouse pads, etc.) Acknowledgement of employees with consistent excellent appraisals and/or review to be published in the intranet and email blasted. Acknowledgement of employees showed significant improvement in appraisals and/or reviews to be published in the intranet and email blasted. Another scheduled general assembly this time with the CEO.
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Implementation Notes Cassidy and Callahan should make sure to build on the strength of the company where they continuously value its employees that they have never resorted to layoff employees. The final choice is given to the nominees. In the continuous pursuit of excellence, the would really have to implement a review and select process to identify weaknesses in the company and either encourage them to improve or review their skill where they maybe a more productive human resource in another firm. It is in fact an unavoidable human resource cycle but management is continuously putting the general welfare of its employees and business goals and objectives.
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