Lessons from the front line: How the best companies are communication in Covid-19

How the best companies are communicating in COVID-19 By John Connolly FAICD.

1 January 2021

Now we are coming to the sharp end of the COVID-19 pandemic. Now it’s harder to talk about hope and that’s there’s a brighter future ahead.

They’re nice thoughts.

More than 3 million Australians are on the wage subsidy JobKeeper, with many more supported by other government schemes.

More than 2 million of those on JobKeeper will come off it at the end of September. The removal of the $1500 a fortnight wage subsidy JobKeeper could push unemployment beyond what the Treasurer Josh Frydenberg believes is the current effective rate of 13.3 per cent.

During the pandemic companies around the world have restructured, meaning many of those jobs won’t come back. Many industries won’t recover for years and many small businesses will simply go to the wall. Banks and other financial institutions will finally have to ask for their money back.

So, what should a CEO be saying to their customers, shareholders and employees now?

Internal Communications

Here’s five rules for communicating bad news internally:

  1. Start early: more painful for you, less painful for them. And better still, less chance of a leak. A leak tells everyone you can’t be trusted and you’ve been plotting against them for months. And a leak means you’ve lost control.

  2. Don’t wait till you are 100 per cent certain. Tell them what you’re certain about, not so certain about, and what won’t happen. Update it as you know more.

  3. People don’t love bad news but they respect your for it. They hate uncertainty and it can make them sick.

  4. Tell them the truth. Don’t use corporate speak. Don’t gild the lily.

  5. Face-to-face is a winner. Everything else is second best or worse, although the pandemic may mean video conferencing is in some cases the only option.

Industry associations should start preparing Australians for the reality of what’s going to happen. They should see what they can do to help their member customers prepare.

External Communications

The following case studies demonstrate that organisations who “share the burden” in prudent and empathetic ways will achieve the highest customer satisfaction, retention and level of trust.

Woolworths and Coles

Australia’s two major supermarkets, Woolworths and Coles, faced enormous challenges as panic buying took hold with shelves stripped bare, fights breaking out between customers and overwhelmed staff subject to abuse. In response to concern the elderly and vulnerable were missing out on essential items, the supermarkets introduced “community shopping hours”.

Coles also extended the initiative to health workers in acknowledgement of their extraordinary circumstances including long working hours. The community shopping hours as well as limitations on the amounts of particular items one customer could buy at a time were communicated broadly through ads in newspapers, on radio, on social media, in store signs and media interviews with the CEOs as the face of the supermarkets.

The result: In the early months of the pandemic, the COVID-19 brand initiative that won the most approval from Australian consumers was Coles’ and Woolworths’ community shopping hour to help the elderly and vulnerable access groceries.

The next best initiative was Qantas arranging jobs as shelf packers at Woolworths for stood-down baggage handlers.

The Big Four banks

Australia’s big banks offered to let mortgage holders defer their home loan repayments and relieve some of the financial pressure from the pandemic. The banks’ reputations were left in tatters due to the fallout from the 2019 Banking Royal Commission, which found many financial institutions put profit over customers and above compliance.

But the banks had started to move off the naughty list with the way they responded to Australians in the bushfire and floods. The banks moved swiftly during the bushfire crisis of the summer of 2019-20 to practice “compassionate banking”.

They followed this up by moving early on in the pandemic to offer mortgage holidays. Again, it was the CEOs who were the “face” of the institutions.

Rather than trying to sell customers new products and services, banks became a trusted source of information, such as details on government grants and supports. They used their websites and social media channels to teach customers how to use existing online tools to bank, provide frequent status updates as well as segment-specific campaigns targeting audiences such as small business owners.

The result: The four major banks are in a media and political honeymoon. Regard is the highest since bank managers were the most trusted people in communities decades ago. But a return to business as usual might put them back in the naughty corner.

COVID-19: What boards and management need to do now

By John Connolly FAICD

While there have been similar Black Swan events before, it would be mistake to not to think through the differences and the different actions needed in this COVID-19 pandemic.

Basically there are three pandemics running together. The virus, the panic about the virus and the business and economic implications. All three are genuine crises. Each one needs different tactics. However what is critical, is that as well as doing what’s necessary to survive, is to have a team working on your recovery strategy and even what opportunities there maybe.

One thing is certain. All stakeholders will look intensely at what, if any, leadership a company demonstrates. Experience tells us that very few CEOs or chairs will actually lead.  In a crisis employees and others make long lasting judgements about the competence of the boss. As we have seen with political leaders over the last few months this is based less on what the leader says and more about what he or she does.

There are some unique issues to consider with COVID-19:

  • Directing employees to work from home risks mental health, misinformation and socialisation problems; and directors now face criminal liability if their conduct harms the physical and mental health of employees.

  • There are logistical concerns particularly if day care or schools close.

  • The normal investor relations channels are mostly shut down particularly road shows and investors conferences.

  • Increased importance of scenario planning from best to worst case and how to communicate those to stakeholders.

  • From those and the experience of others look at how customers are reacting and will react.

  • Determine what your company’s vulnerabilities are and model the effects.

  • Decide what structure and people you need to manage your response. What is the impact on key staff working from home, being sick? Is your IT able to handle it?

  • What are you HR policies going to be now and in the longer term?

Then there’s the communication aspects:

  • How do you establish you and the company as a trusted voice of authority?

  • What do you do (rather than say) to show you are leading and calm staff and shareholders down?

  • Given the fear and anxiety your employees (and you feel) how do you cut through the conflicting advice from government, the media and self- appointed experts?

  • Communicate the same message again and again: in times like this when you’re sick of saying it, your employees are just beginning to get it.

  • Be very specific about what you want people to do.

  • Think about telling them not only what they need to do now but maybe what they need to do next.

  • Communicate in bullet points not long form narrative.

  • React really quickly internally and externally if false news starts spreading.

Key board questions for testing COVID-19 communications plans

  • Are the board and management aligned and clear in terms of crisis communication roles and responsibilities? In the short term, and if the crisis lasts for 6-12 months?

  • Does the board have all the information it needs to understand the full range of risks to our employees, our organisation and our industry?

  • Does management have a clear business objective for its communication strategy and plans?

  • Does the company have a comprehensive communication strategy or just templated crisis communication plans?

  • Does the board understand who are the critical stakeholders the organisation needs to be communicating with and the plan for getting and listening to all those stakeholders?

  • Does the board have confidence the organisation has reached every employee and contractor?

  • Does the board understand how the organisation is communicating with customers and how customer behaviour, sentiment and anecdotes will be effectively reported?

  • Does the board have a clear understanding of the duty of care in relation to changed work arrangements, physical and mental health of our employees and how the organisation is going to communicate with employees on an ongoing basis?

  • Is the board clear about how it will manage communication and retain the confidence of investors through this crisis? For example, how will it communicate the impact to organisational strategy of the six-month temporary relief for directors from personal liability for trading while insolvent

Principles of communicating in stressful situations

By John Connolly FAICD and Stan Glaser PhD MAPS

If you look at the COVID -19 print advertisements from some governments and big companies, it’s clear that the urgency to say something has overtaken the principles of communicating in stressful situations.

Inside companies we’re seeing many of the same issues.

“This is big - the more I say the better.”

No, it’s not.

What the research tells us:

  • The prevailing view is that people run for the exit when thrust into a crisis.

o   This is not quite true.

o   People are more likely to huddle in the one spot and hope things will get better.

o   And that’s where leadership finds its place.

o   The community looks for the voice of passion and purpose.

  • In stressful situations, people can’t take in too much information.

  • In fact, our ability to hear, understand and remember information can go down by close to 90 per cent.

  • Emotions dictate what we see and understand – it is hard to get a message through this distorted lens.

  • People are scared, and when they become scared they enter a sort of paralysis – like kangaroos in the headlights.

  • Conflicting messages exacerbate this paralysis.

  • People under stress will put more meaning into non-verbal cues.

  • If you get the non-verbal cues wrong, don’t expect forgiveness.

  • Forget the 30 second rule - people make up their mind whether they trust you in one-tenth of a second.

  • The majority of drivers of trust are nonverbal, and primarily communicated by the face.

  • People are looking for certainty and hope - this is how humans normally survive.  But it is vital to acknowledge the uncertainty.

  • But be prepared - people will focus more on the negative.

  • We already know what people are worried about, and what they want to know.

  • Most of the concerns and questions of upset or concerned people can be predicted in advance.

  • Recency and primacy - people will tend to remember what’s said first and last.

What to do:

  • Communicate in small bites.

  • Communicate in bullet points.

  • Most of the current corporate advertisements have too much information and are over designed – there is too much noise.

  • The right graphics are critical.

  • Tell them what you’re certain about, not so certain about, and what won’t happen.

  • Don’t over reassure.

  • BUT PROVIDE HOPE.

  • Drag them away from the present:

o   Recognise that people respond strongly to their immediate circumstances.

o   OmniPoll research tells us that people are now feeling helpless, scared and isolated.

o   Communication should help people look to a bright future with hope and connectedness: “We will all get through this together”.