The Recession in Confidence: Are questionable economic times having an impact on the way companies communicate? Here’s what two key communicators say.

More with Less at Ford Financial

When Ford Financial announced its new focus last fall, its goal to become a global automotive financial superpower, it brought a lot of attention from the press. Then, just before Christmas 2001, the company’s CEO resigned, and a new chief executive had to be introduced to the media.

These major communications challenges coincided with a time when the company’s communications budget and staffing were both reduced. “We’re certainly doing more with less,” notes Walter H. Jennings, Vice President, Global Communications. “Ford has really adopted a back-to-basics approach, a ‘focus-on-funds’ approach.” Jennings reports that while two years ago he was involved in major events and huge projects such as interactive video, he now finds himself having more work to do and fewer resources to do it with. “We are now taking a fundamentally new approach to each individual communications position. The challenge is how to meet the demanding internal challenges while at the same time lowering budgets.”

For Jennings, the questionable economic times have meant having to pare down some of the services that his department once provided. “We’re having to force choices with our executives,” he says. “We are now far more likely to go to them and say, ‘This is how we’re structured. These are the services we offer.’ We simply no longer have the time or resources to work in some areas. For instance, we’ve given up Intranet development and event planning. Instead, we’re really focusing on five or six things that we not only have to do, but also that we do best. I’m talking about such areas as issues and crisis management and media relations.”

While some major corporations report that they have brought all their PR functions inside, Jennings says that he continues to outsource, but has brought it closer to home. “I changed from a national PR firm to a local Detroit agency that has some national expertise,” he says. “They appreciate our business, they’re right around the corner, and they cost half as much,” he notes. 

He has also removed some contract positions, pulling more into the core of corporate communications. There is a side benefit to this, however. “The team members used to be much more codified. More focused. For example, a staff member was an event planner or a media relations coordinator or whatever, period.  Today they have a lot more flexibility. We’re turning things around faster because we’re doing it with a lot less pomp and circumstance. We focus on getting it done right, getting out quickly, and then moving on.

For Jennings, it all comes down to a constant process of making do with existing resources. “We are like a dinner host who plans for eight guests and 16 arrive. The challenge then is how to feed them all, when you’ve only got a budget to feed eight. It constantly forces us to be creative.”

Paring Back at Lucent Technologies

Kathleen M. Fitzgerald, Senior Vice President, Public Relations and Advertising at Lucent Technologies, reports that the economic downturn caused a dramatic reduction in the amount of advertising and PR done by Lucent. “We cut our PR staff in half. We eliminated all print ads and went to the Web. We began doing many more conference calls and dramatically cut the amount of business travel. In essence, we began to take Lucent executives to the people, rather than bringing large groups of people to various divisional locations,” she says. “We have also halved the number of trade shows we participate in.”

Fitzgerald is quick to add, however, that some of these changes are driven as much by new technology and by trends in the way other people work as by the economic downturn. “For example, it’s a lot cheaper and more efficient to simply put PR announcements on the web and give people in the press the URL than it is to do mass mailings of press releases, and we probably would have made that switch even if the economy were booming,” she says. She also explains that big press conferences have been abandoned less because of the cost than because of journalist preference. “Serious reporters don’t have time to come out to press events. They want to do individual executive interviews now. We try to give them what they want,” she says.

Fitzgerald echoes Jennings’ statement that the rule today is doing more with less. “The people who remain on staff are all working much harder,” she says. “The key now is to prioritize. Many of the reductions we have made were with people at on-site locations – cutting those numbers from 50 to 10. Now we handle more from the central office, and use technology more to get the news to external locations,” she says.

In terms of working with outside firms, Fitzgerald says that she uses one agency for PR counsel. “We used to have relationships with agencies outside the U.S. to support our efforts, but with things so down in the telecommunications industry in general that is no longer the case,” she explains. She adds, however, that she still might use an additional agency for something like a large product launch, because it typically proves to be cheaper than having an employee on-site year round.

© 2004 Heyman Associates, Inc.