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executive transition

Smart Planning for Executive Transitions: When Time Is Not On Your Side (Part 2)

This is the second part of our two-part series on executive transitions. If you missed the first one, you can read some tips for handling a planned executive transition here.

Transitions are high stakes for both companies and investors. It’s emotional, especially if an organization has seen a lot of executive turnover in a short time. In fact, 70% of CEOs and managers—i.e., people leaders—are considering quitting. Experts suggest that emotional burnout, the stress of the pandemic, and the shifting labor market and economy are all likely contributing to this trend. 

Executive turnover brings up a variety of reactions. While some employees get very anxious about having to manage or “break in” the new leader, others—like those who were “quiet quitting” before it was a thing–check out entirely. Neither extreme is healthy for individuals or companies.

In Part 2 of our Executive Transition Series, we’ll consider a situation that’s a bit different than the planned exit of a long-term CEO. 

Imagine it’s three years into the pandemic, and your current leader, who has been with the company for two years, has admirably faced the challenges the pandemic brought to all organizations. Although she has managed quite well, another opportunity comes up and she submits her two weeks’ notice.

Without a transition plan in place, the company could be thrown into chaos. Some employees may have come to the company only to work with her, and others might be suspicious of how leaders are going to handle the change, or whether the company has a future at all. Executive  transitions are emotional and complex, and the fact is that there isn’t always time to prepare.

In a case like this, context will drive a strategic communications plan. What’s the context around the exiting CEO? What is the plan for the interim leader? Are we looking internally or externally? Most importantly, how do we set up a new leader for success and demonstrate stability to our employees?

4 Tips for Unplanned Transitions

 1. Storytelling

 This tops our list again because storytelling is how humans best connect and communicate. That doesn’t mean telling fairytales—employees can tell when a communication is bullsh*t or hiding the truth. It is important, as much as is professionally appropriate, to be honest about why change is coming. 

Tell the truth and allow room for employees to both have and share their thoughts and feelings about what’s happening. You’d be surprised at how much it helps to have leadership acknowledge that a particular situation is really challenging. Otherwise, you risk making employees feel as if they’re being gaslighted. Transitions are inherently challenging, and employees need to know they’re not alone in feeling it.

2. Due diligence

You’ve made space for the feelings, and now it’s time to do your due diligence. This has two parts: finding your next leader, and continuing to achieve your goals.

Finding a new leader will be your utmost priority. Most likely, your Board of Directors will take the lead to determine an interim leader and initiate a search for the next leader. You’ll need to announce and introduce the interim leader while also giving employees, customers, and partners a sense for the plan to find your new executive.

Finally, you want to help your team keep their eyes on the prize, whether that’s increasing sales or another goal for this quarter. Transition can be a major distraction. While it’s okay to acknowledge feelings of uncertainty, it’s also important to support your team in moving forward. 

As the saying goes, companies are bigger than one person; success is shared vision and collective action. By providing the right support, you can empower your team to keep pursuing the strategy. This will not only help maintain a sense of stability and continuity, but it also ensures you avoid larger business problems if performance falls off.  

 3. Fact finding

This is related to storytelling, but it’s different because this is not just about providing employees with a narrative that they can understand. It’s also about addressing any unanswered questions that may surround the circumstances of the exiting CEO and the changes that are coming.

People should be able to ask questions and feel they’re being heard. They should be able to say, “you’re the third CEO in three years, why should we trust that you’ll stay?” The sooner you get it all out there, the sooner you can move on. 

If you don’t answer the questions your employees have, they will fill in the blanks. It is better to be transparent and to provide honest answers to the difficult questions. Sometimes the honest answer is, “we don’t know yet” or “we’re still looking into it.” That’s okay. Better to be honest and give a sense for what you expect to be a timeline to an answer. This will build trust and, if done well, help with employee retention. 

4. Introducing New Leadership

As with planned transitions, employees want to know who the new leader is. In an unplanned transition, and especially a fast one, there might be more skepticism and suspicion. Being as transparent as possible about the new leader’s background and vision are crucial. What’s her background? Does she prefer to hire from specific universities? What’s her vision for the next five or ten years? 

Offer employees a variety of opportunities to talk with and about the incoming leader, and keep in mind that everyone has different levels of comfort with asking questions. Consider holding “Donut Wednesdays,” fireside chats, and other informal channels where leadership and teams can connect. You might also offer webinars where more introverted employees can submit questions virtually. As much as you can, provide ample time and spaces for teams to have conversations with transitioning executives as well.

The Need for Strategy

 Executive transitions—whether planned or unplanned—require strategy and careful planning. Storytelling, transparency, and diligence can help ease the growing pains of your company. However, it’s important to note that there are important and subtle differences in strategy for planned and unplanned transitions. 

For instance, employees are far more likely to feel insecure about their job and the future of the company amidst an unplanned transition. And without careful communication, rumors are more likely to distract from workplace goals. Honesty, diligence, and insight into company culture and employee needs are key for maintaining normalcy and retaining your valued employees.

 In all cases, I recommend you use a variety of channels and venues to soothe your most anxious employee and to engage your most checked out employee. Hold fireside chats, host Q&A sessions, send email updates from the hiring team, and create spaces for leadership to connect with their teams.

 Transitions can be chaotic, but they can also be opportunities to engage employees, customers and partners. A smart executive transition can open up a gold mine of insight into how these stakeholder sets are feeling about the company more generally. With the right support, you can use the transition as an opportunity to zero in on your systems and communications. If you’re willing to be present with the process, the results can be better than you ever imagined.

Want an experienced set of eyes to help guide your executive transition plan, or don’t know where to begin? Audacia can help. Reach out to us for a consultation here.

Photo credit: Young Businesswoman Receiving Praise From Her Colleagues During A Meeting In A Modern Office by Jacob Lund Photography from NounProject.com

executive transition

Smart Planning for Executive Transitions: When You See It Coming (Part 1)

Transitions, including executive transitions, are high stakes for companies for obvious reasons. They bring about logistical, bureaucratic, professional, and emotional challenges for everyone involved. That’s why we’ve created a two-part Executive Transition Series to help you out during seasons of change in your company. 

Executives can be a powerful retention mechanism, or the reason people leave. Consider the old adage, people quit bosses, not jobs. Alternatively, sometimes employees come to a company to work with a particular leader. What happens when that leader leaves? And what about when veteran employees have worked with the same leader for multiple years, and a new leader radically changes the culture? These are tough questions, and not ones you can sweep under the rug.

The key for dealing with executive transitions is communication. It’s important to tailor your strategy to the kind of transition you’re facing. On the one hand, you might be facing a planned transition—one that’s been on the horizon for months or years. On the other hand, you might have a leader—maybe one who hasn’t even been around very long—give two weeks notice. These are two very different situations, and having a strategic communications plan can help you make it through either one.

In this two-part series, we’ll consider both situations. First, we’ll consider some tips for handling a planned transition.

4 Tips for Planned Transitions

Executive transition is a specialty of ours here at Audacia Strategies. Let me share one of my favorite engagements and biggest client wins when supporting a client through a planned transition. Recently, Audacia was brought on board to help with an executive transition in a software company. The outgoing senior executive was the founder of the company and also an avid, talented guitarist. A low key rockstar, if you will. The company culture was centered around music: leadership documents were full of music analogies, guitars were given as gifts, leaders put their favorite song in their website bio–you get the picture.

The leader planned his exit and helped to identify a new CEO. The new CEO was brilliant—he had run billion-dollar organizations and grew up playing chess blind-folded! While this new CEO was a great fit to guide the company to its next phase of growth, he was different from the founder-CEO. An executive transition is one thing, but the reality is that the company was also about to undergo a cultural transition.

How do you manage the exit in a case like this? Here’s the playbook we advised.

1. Storytelling

As long as people have been around, they have connected over stories. We made space for the outgoing CEO to share his story, and time to celebrate his work with the company. Just like a graduation or retirement party, this allows for closure and creates appropriate professional space for processing the (big) feelings that come with transitions.

 2. Getting to know the new leader

 In addition to telling the story of the outgoing CEO’s time, we worked with the incoming CEO to help him identify and share his story. This humanized an ultra-smart leader and gave employees a chance to get to know him and understand his priorities and what makes him tick. 

We also advised on creating plenty of opportunities and multiple channels to engage with the CEO and ask questions. Unanswered questions can leave employees feeling ungrounded and many may be too intimidated to ask the hard (or even simple!) questions. 

We always advise to be as open as possible and provide opportunities for interaction in multiple formats (in-person, online, large group, small group, 1-to-1). Transparency and accessibility are key for maintaining and building trust.

3. Working with the team

The logistics and bureaucracy involved in a transition are not to be underestimated; however, it’s also important to work closely with the team. Share the transition plan, let your executive team know what is coming and let them weigh in on what they and their teams need. And, practically speaking, set expectations about which responsibilities will be redistributed, who will be responsible for training whom, and so on. Executives have questions too–give them time to process the transition and bring their questions to the new executives or trusted confidants. 

4. Mind your communications

We trade a lot in written word, scripts, and talking points. Emails and other written messages are important artifacts that preserve institutional memory long after the transition. Because everyone can look back and see where leaders followed through and where they didn’t, it’s important to be consistent across multiple mediums (video intros of a new CEO, webcast town hall, in-person meet and greets, welcome letter, and so on). 

Perhaps even more importantly, organizations should make sure messaging is consistent across informal communications as well. During times of transition, employees will first bring their worries and questions to direct supervisors and peers. The executive team and their team needs to be on the same page so they’re ready to help their teams navigate organizational changes. During times change most employees and customers will turn to their line manager or customer success contact for reassurance, make sure these critical team members have the information, resources, and support they need to succeed.  

Concluding Thoughts

 Planned transitions are admittedly easier than unplanned transitions; however, planned transitions can still be destabilizing to company culture. At worst, transitions can result in employee turnover, loss of trust, lost business momentum, and a decline in workplace climate if you don’t go in with a strategy. It’s important to keep in mind both the emotional and logistical challenges of executive transitions.

We often think about corporations as faceless entities, but in moments of transition, we are reminded that corporations are made up of people who have hearts and minds. The more you share your story honestly, transparently, and thoughtfully, the more you can weather this season of transition while building long-term trust and continuing to achieve your company goals.

If you don’t have the luxury of a planned transition and are facing an imminent unplanned transition, read the next part of our two-part series where we’ll discuss tips for handling an unplanned executive transition.

If you’re facing a transition—planned or unplanned—and you’re trying to find the right strategy, Audacia has you covered. Reach out to us here to schedule a consultation.

Photo Credit: Black Male And White Female Business Associates Shaking Hands In Hallway by Flamingo Images from NounProject.com

IPO Roadmap

The IPO Market Won’t be Frozen Forever. Prepare for Your IPO with Audacia’s Roadmap

After two HOT years for Initial Public Offerings (IPOs), the IPO market was due for a cooling period – and cool it has. “There’s an inverse correlation between market volatility and IPO activity,” said John Tuttle, vice chairman of Intercontinental Exchange’s ICE NYSE Group. The combination of rising interest rates, geopolitics, and shifting investor expectations have had a chilling effect on new listings. 

And while the IPO market is quiet – for now – it’s unlikely to remain that way for too long. In fact, many companies are taking this time to assess their readiness to enter the public markets. A great move, if you ask us. The Initial Public Offering (IPO) process is one of the most complicated and demanding events a growing company can go through. You need an IPO roadmap to be ready to deal with investors, auditors, lawyers, investment bankers, and accountants, among others. And then there’s the paperwork…

If you’ve never taken a company public before, you’re probably wondering what lies ahead of you. Never fear, with our IPO Roadmap you’ll be thinking three steps ahead. 

Audacia Strategies’ IPO Roadmap

We’ve talked about this before:  in a 3-part series, I broke down the process into three parts: developing your IPO story, building an IR team, and living with your IPO. Taken together, these three stages make up Audacia Strategies’ IPO Roadmap. Here are the highlights from each part.

1. Developing your IPO story.

Your IPO will include multiple filings that describe your business, your risks, and your opportunities. While you’ll speak with several different financial audiences (e.g., institutional investors, credit rating agencies, sell-side analysts, etc.), it’s important to develop a coherent story. We call this your investment thesis. Learn it, live it, love it. It is the core of your discussions with financial stakeholders and especially investors. Consistency is key.

After you have agreed on the  investment thesis for your business, it’s time to develop a narrative arc that answers the question: “Why buy this stock?” Make sure that you tell your story – not your competitor’s story – and that it goes beyond the numbers. Remember, investors are human. They respond to a real story like anyone else.

If you’re going public, that means you’ve spent some time honing your value proposition. Now is the time to expand upon and refine this message. Explain what makes your company unique? What’s your “why?” Think about where you can connect with investors in an authentic way and lean into that story.

Ideally, your story establishes your credibility and proof points and sets reasonable expectations. Keep the following in mind: your first few earnings announcements following the IPO will be closely watched to see how the company’s performance matches expectations set during the pre-IPO roadshow and how the management team characterized the firm’s performance in its S-1 (i.e., your initial registration statement with the SEC).

2. Building an IR team.

Once you have your investment thesis and narrative, it’s time to get operational. Put together your dream IPO team and make sure your team includes people with investor relations (IR) experience

Having a solid investor relations plan will guide your IPO discussions and ease your transition to life as a public company. The most important job? Establishing and building corporate credibility with your stakeholders through transparent and consistent communication.

And yes, there are some tools of the trade you’ll need to run an effective IR program:

  • An IR website: A place for investors, analysts, and the public to see your investment story. This should be easily accessible from your company’s primary website. 
  • An IR platform: A tool to track consensus estimates, trading patterns, analyze your shareholder base, research and target new investors, review ownership trends, etc.
  • Stock surveillance (optional): While not a requirement – it can be pricey – this type of information can be incredibly helpful to understand the ebbs and flows within your shareholder base. It can also be a lifesaver when your CEO sticks their head in your office and says, “what the heck is going on with our stock today?!”

Your IR team will ensure that you don’t stumble out of the blocks and set you on the road to building long-term trust with shareholders.

3. Living with your IPO.

Yes, Virginia, there is life after an IPO. I know it may not seem like it now because you’re so focused on preparing for the IPO that it’s hard to think past next week. But trust me, your future self will be glad you thought about this third and final stage ahead of time.

Don’t get me wrong, going public is an achievement in itself. By all means, take your victory lap. But also realize that having an IPO opens you up to a whole new level of public scrutiny. This is good news, but it means you need to follow through on your public commitments, keep telling your story (even after a 15-hour day of investor discussions), and continue to educate and build your shareholder base.

The key to a successful life after the IPO can be broken down into four simple steps:

  1. Set reasonable expectations.
  2. Tell stakeholders about them.
  3. Execute on those expectations.
  4. Tell stakeholders about that.

When your company goes public, you step into the spotlight. Yes, the stakes are higher during life after the IPO. But it’s nothing you can’t handle. You’ve got this!

Nervous about prepping for your IPO? Audacia Strategies has your back! Contact us to schedule your consultation.

Photo credit: Close Up Of Multi-ethnic Group Working Together Around A Laptop by Flamingo Images from NounProject.com

CEO communications

3 Questions Every CEO Needs to Understand to Communicate with Investors

Communicating with investors is one of the most important tasks CEOs need to master. But strong CEO communications might not be beneficial only for the reasons you expect.

All companies want to hire charismatic leaders with strong communication skills. What you might not realize, though, is that a CEO’s communication style and presence can actually impact corporate value. According to a 2020 study, companies led by a CEO who communicates effectively, better withstood the initial negative share price impacts of the COVID-19 pandemic.

Of course, communicating with investors takes a special touch. Investors are a tough audience. The most successful investors approach new investment opportunities with healthy skepticism. And how CEOs respond to skeptical investors is key. Investors look for authenticity, authority, and credibility.

In our article for the Harvard Business Review, Audacia Strategies Partner and CEO of Green Room Speakers, Sarah Gershman and I distilled our advice from 20 years of experience working with executives and investors to three core questions. Here, let’s look at strategies CEOs can implement to better connect with investors.

1. Is the CEO confident, without being overconfident?

Investors want to see a CEO who has confidence in their company without being blind to the real challenges they are facing. We like to call this “reasoned confidence.” An overly optimistic presentation runs the risk of losing credibility. As one investor put it, “Don’t be a LEGO-movie leader telling us that ‘everything is awesome.’”

Reasoned confidence is especially critical during specific types of CEO communications, especially crisis communications. Feeling overconfident during a crisis can lead to over-promising or what I like to call the Top Gun Problem: “Your ego is writing checks your body (or in this case, your business) can’t cash” (and with the release of the new Top Gun: Maverick, this reference is more relevant than ever).

To avoid over-promising during a crisis do the following:

  • Triage: You can’t put out all of the fires simultaneously. Instead, you need to prioritize carefully and make hard decisions about where to distribute your attention. An investor relations professional can help you with this.
  • Be transparent: It’s important to set expectations with investors – and other stakeholders! – during a crisis. But if you try to do this in a way that could be perceived as a cover up, you’re digging yourself deeper. Be honest and up-front about issues and what you don’t know.
  • Continue to monitor the situation carefully: Your initial statement is only the beginning. You next need to implement the crisis plan and follow through on your commitments. The absolute worst outcome after a crisis is for a new crisis to develop as a result of mishandling the original crisis.
  • Keep internal communications open: It’s critical to maintain an open dialog within your company, especially during a credibility crisis. In addition to stabilizing the team when they can feel in freefall, employees are your frontline communicators to customers and business partners. 

2. Is the CEO a straight talker?

In addition to being overconfident, CEOs may overcompensate by trying to gloss over the truth or talking in circles. Say it with me: More words does not equate to better outcomes. We often work with CEOs to ensure that they use plain language and give the news to their investors straight. 

Further, while strong preparation is crucial for investor presentations, it is possible to over-rehearse, over-polish, and completely forget about connecting with your audience. An overly polished presentation can leave the audience wondering whether you’re simply telling them what they want to hear.

Investors want to feel seen and heard in a way that sounds authentic and credible. It’s time to get human. Here’s how:

  • Think like a reporter: Journalists are trained to give the who, what, where, when, and how of a story in the first sentence or two when reporting on a story. Replicate this tactic by getting your communications teams together (or go outside of these departments for a different perspective) to brainstorm.
  • Dump the buzzwords: Buzzwords do more than whitewash the stuff we don’t want to talk about. They also obscure your message and make your organization seem less authentic. If you confuse investors with jargon or industry terminology, they will ignore you.
  • Get vulnerable: If you’ve faced a genuine struggle that has made you rethink your company, now may be the time to pull it out and share what you learned. Don’t be afraid to step back from the spreadsheets and share your bigger vision with investors.
  • Step away from the webinars: The formality of webinars can result in investors feeling totally disconnected. Consider how you can incorporate less formal discussions, roundtables, open mic Q&As, etc. While it may make sense to give a short written statement or update to kick off an investor meeting, listening to written remarks being read for any longer than 10-minute intervals is probably too much to ask from those on the other side of the camera.

3. Do they know how to listen? 

Sure, as a CEO, you likely know how to talk. It’s tough to become a successful leader without having the ability to communicate your vision with others. But, how good are you at listening?

Listening is one of the most undervalued skills of CEO communications and a CEO who lacks the ability to listen happens to be one of the biggest red flags for an investor. For CEOs who master the art of listening, however, answering questions from investors can be a great way to boost your credibility. Every question expresses a need, and your answer should show that you hear what’s behind the question. 

A question about your research and development investment strategy, for instance, may actually also be about whether an investor can trust you with their money. If you can’t suss out the deeper need, then you may need to ask for clarification before attempting an answer.

One way to make sure to prioritize listening is to run a murder board before the presentation. To make sure you’re prepared for investors, you’ll want to call in your toughest internal financial analysts and encourage them to live out their wildest inner Shark Tank dreams. Assemble your investor relations murder board and have them begin coming up with “tricky” questions regarding different angles on your message and the numbers.

For example, suppose your firm calls for 10% year-over-year growth. That sounds amazing to your team, unless your biggest competitor comes out with an expected 15% growth rate. Now you’re behind in an investor’s eyes. What does it mean for your business and key competitive differentiators?

This type of preparation can remind you to listen closely to the question and its intent, focus on the facts and not speculation, and practice answering in a way that connects with the audience.

There’s no doubt investors are a tough audience. We have found that the best investor presentations happen when CEOs stop focusing on their own performance and instead speak to investors using reasoned confidence, straight talking, and masterful listening.

For more tips about how CEOs can prepare to answer these three core questions, read the original article in the Harvard Business Review. And if you’d like to learn more about how Audacia Strategies can help you prepare for your next investor meeting, schedule an initial consultation.

Photo credit: Professional Woman Standing In Boardroom Giving Speech To Team by Jacob Lund Photography from NounProject.com

transformative change

“Are We There Yet?” — Change, Communications, and Culture

If there’s anything that’s more difficult than transformative change, it’s communicating about transformative change. And let’s face it, the past two years have been defined by change.

As leaders of organizations living through a profound period of global change, we’ve learned some powerful lessons:

  • The future will not be more stable or more certain.
  • Black swans feel much different when we live through them (sometimes multiple times), than when we read about them in economics textbooks.
  • Disruption or large scale change cannot be contained to one aspect of life.

In short, societal shifts spill over into personal and business life, business upheaval impacts personal and societal security, and uncertainty about personal health throws a wrench into every aspect of life. No matter how hard we try to avoid it, transformative change comes for all of us.

With the hindsight of the last few years, now is the time to review our approach to change and ask ourselves how we can better prepare for and communicate about the next wave of transformative change. Let’s take a closer look at the core aspects of strong communication here.

The Pulse of the Organization

Exhausted organizations do not handle change, let alone transformation, well. Think about how well you operate after a series of all-nighters. Even the thought of having to eat — to survive! — feels like a monumental task. Similarly, exhausted organizations can barely perform key functions, which doesn’t bode well for facing changes with grace.

When leaders continually keep their fingers on the pulse of their organizations, however, they are less likely to lead exhausted organizations and much better positioned to handle transformation. Keeping your finger on the pulse means recognizing when your people are being pushed to their breaking point and making the necessary adjustments needed.

How do you take the pulse of your organization?

  • Get to know your employees and customers: Use pulse surveys (Voice of the Employee (VoE), Voice of the Customer (VoC) surveys), “ask me anything” sessions (AMAs), virtual and IRL coffee chats, town halls, skip level meetings, “walking the halls” (for those back in the office).
  • Get to know your leaders: Keep tabs on your people leaders and customer leaders too. Managers can often be the linchpins of culture and influencers of others.
  • Ban the “just deal with it” mentality: Of course, decisions need to be made and transformative change must go on, but if your strategy is to tell your people to “just deal with it,” then you have a failed strategy on your hands. Instead, build a plan with the tools, support, resources, and aircover they need…and be ready to adjust. 

Transformative Change and Culture

Taking the pulse of your organization is only the beginning of figuring out how to communicate about transformative change. To really pull this off, you also need to consider the culture on a deeper level.

Having a change playbook is important, to a point (and lord knows you can find a consultant who will sell you one), but remember that a guide is just that — a guide. There may be times when what your team really needs is for you to set that playbook on fire (maybe even literally).

Here are some areas to consider when it comes to culture: 

  • Consider what is authentic to your organization. What is the general tone of communication? And if there was ever a time to be more transparent, more honest, more plain spoken…transformative change is that time.
  • Consider who is trusted in your organization. Perhaps the Board of Directors is more trusted than management (I’ve worked there). Or perhaps long-tenured middle management is trusted more than the new or newer executives? Understanding these relationships and building that into your strategy is crucial.
  • Consider why you’re doing what you’re doing and have a good answer. Just because “all the other $1B organizations” use top-down communications for layoffs, doesn’t mean that you have to. Keep in mind, “because I said so” is not a successful strategy for successful change.
  • Consider what you are asking of your team and customers. Transformative change, or any change (hello, Atomic Habits), requires commitment. It’s about the larger purpose and that’s generally an emotional ask. You are asking your team and your customers not just to help you make a business change, but to take a journey with you toward achieving your organizational purpose — which will solve more customer problems, make the world a better place, make the organization a better place to work, or any combination thereof.

A Few More Do’s and Don’ts

Once you have thought through the lay of the land and have the big picture in front of you, here are a few more do’s and don’ts to keep in mind.

1. Don’t sand down the edges on the executive team. 

Whether it’s a layoff, a major acquisition, or an IPO, your people are your biggest asset — yes, even in the metaverse. And employees, customers, and the media are all looking for leaders to lead and exhibit humanity.

In a recent interview, Brian Chesky, the CEO of AirBnB, said it well, 

“I think CEOs and leaders are more human than they come across. I mean most of these people are real people. They do have feelings. I think the problem with corporations is the lawyers and the HR people and the others, ‘sand the edges’ off the person in an effort to protect the person. And, that is a major disservice because they just reduce them to something that’s not even a human being anymore, they’re just this very cold person.” 

Of course, you need to work with your executives to communicate in a way that complies with the law and represents the organization appropriately, but this is very different from turning them into robots who are afraid to show any glimmer of vulnerability.

2. Do acknowledge the suckiness, if it sucks.

You may be surprised at how much resistance to transformative change can be relieved with a simple acknowledgment of how difficult it is. When it feels like you’re the only one feeling the pain, change can be a really lonely place. Often your people just need you to see them doing their best through an objectively sucky situation. And if it sucks for you too, talk about it.

3. Do acknowledge the excitement of the future, as appropriate.

As hard as it can be, change also usually comes with a lot of excitement. Don’t be afraid to embrace the excitement and display appreciation for the teams that will make the change happen.

4. Don’t promise a return to the status quo.

Never offer to “stop the change.” It may be tempting to try to relieve the pain of transformative change by promising a return to the status quo on a particular date, for example. This falls into the category of promises you can’t keep, though. Sure, there may be a light at the end of the tunnel, a product launch, a closing date on the merger, but even those flashpoint events aren’t likely to spell the end of change. 

We’re all changing, all the time. Our environment is changing, the market is changing, society is changing. All we can do is remain in a ready stance — flexible, fluid, optimistic, and ready to roll with the next pivot or “tweak.”

Finally, I want to leave you with some more words of wisdom from Brian Chesky because these two sentences are really all you need to know when it comes to communicating about transformative change: “Just do whatever you think is the right thing at that moment. Take care of people and then they’ll root for you.”

And you know Audacia Strategies is here for you. We’re ready to help you better prepare for and communicate about the next wave of transformative change. Let’s talk!

Photo credit: Businessman Applauding With His Colleagues During A Presentation by Flamingo Images from NounProject.com

M&A trends 2022

Considering an M&A Deal in 2022? Keep an Eye on These Trends

With 2021 firmly in the rearview mirror, now is a good time to explore the merger and acquisition (M&A) outlook for 2022. After an historic year, fueled by a backlog of deals from 2020, soaring global markets, plenty of access to capital, advantageous changes to tax rates, and attractive valuations, investment professionals expect a still active but cooler market in 2022.

While many of the factors that contributed to global M&A volumes topping $5 trillion for the first time remain in play, they are less pronounced. And dealmakers agree that deal volume peaked in August of 2021. This coupled with the likely rise of interest rates this year, which will increase the cost of debt, could impact valuations and slow deal volume.

Despite these potential headwinds, if you’re considering launching an M&A deal on either the buy or sell side in Q1 or Q2 of 2022, you’ll likely find a busy dealmaking environment. So let’s discuss the M&A outlook and what to watch as you prepare your materials.

Takeaways from 2021 M&A Activity

During a panel discussion at the end of last year, my fellow panelists and I discussed strategic M&A opportunities for investors and the M&A outlook for 2022. To watch the full panel discussion, click here.

As we kept an eye on deals playing out at the end of 2021, here are our biggest takeaways:

  • Private equity will continue to play a huge role: Private equity firms played a huge role in M&A deals in 2021 and will continue to do so. According to one report, private equity now accounts for 30% of M&A activity. This makes sense because with the market surge, private investors have a record amount of dry powder (capital) available.
  • Valuation/multiples have been climbing but will likely level out: Most M&A professionals believe that valuations in several sectors have reached their peak — or are borderline frothy. It’s hard to envision a scenario where valuations would be significantly higher a year from now and likewise, few see valuations dropping significantly. Experts expect valuations to settle at a sustainable level in the next few months.
  • More selective deal strategies are on the horizon: While few practitioners expect a slowdown of the M&A market, many see more selective deal strategies on the horizon. We’ll likely see megadeals playing a transformational role and smaller, tuck-in acquisitions playing an increasingly important role for small- and medium-sized companies looking to build and scale capacity quickly with less integration risk.

Key Differentiators Remain

Looking at the big picture, key differentiators remain. Whether you are on the buy side or the sell side, you and your team will want to keep the following in mind:

1. Integration matters.

If you aren’t looking past the deal to the future, then you will be at a distinct disadvantage when negotiating. On the buyside, you’ll want to be ready to share your integration plan. Show your awareness of everything from projected revenues to cultural implications to talent management. Changes to the labor market, for example, could complicate your deal. Be ready to prove that you’re aware of these details.

On the sellside, you’ll want to make integration easy to whatever extent is possible. Identify and mitigate key risks early both in the external competitive market and in the internal workings of the company. In addition to risk mitigation, look for opportunities to create value. Be prepared to talk about how you can add value and the quickest path to increased profits as you see it.

2. Keep non-financial due diligence on your radar.

The M&A outlook also reminds us that there are a lot of factors that can affect deal success and financial performance, but which are non-financial in nature. In fact, 70-90% of M&A deals fail due to non-financial aspects. 

Show your deal partners that you know where the non-financial risks and opportunities lie for your brand. Dig deep into factors such as executive reputation, employee sentiment, culture, and communication style.

Management’s credibility is also important to convey. Develop your story connecting your managers and executives to the company’s mission, vision, and values. The more you can show leadership as standing strong together, the better your prospects for closing a great deal.

3. Pay attention to middle management.

More often than not, middle management — as opposed to the C-suite — controls the narrative for employees and customers. Because managers are often more accessible and work more closely with these stakeholders, they are trusted. So, you’ll want to give middle managers the same attention you give to executives.

According to Sarah Gershman, Executive Speech Coach, CEO of Green Room Speakers, and one of Audacia’s partners, it’s important for middle managers to feel prepared to communicate appropriately throughout the deal process. “Middle managers spend most of their time interfacing with customers and doing the work,” says Sarah. “And telling the story of the merger doesn’t come naturally when you’re in the weeds. So it’s a smart idea to find an expert who can help middle management understand and empathize with their audience.”

Beyond prepared remarks, there will be questions and plenty of uncertainty. Managers are the first line of defense in helping to stabilize nerves, and they are your best line of offense in sharing enthusiasm for the next step of this transformative event. That said, the key when answering questions is to show that you understand the question. “Deep listening is a critical skill here,” says Sarah. “You want to listen not only to hear the question, but also to understand what’s behind the question and what’s at stake.”

What if someone asks a question and you don’t know the answer? According to Sarah, as long as you have demonstrated that you have really heard the question, you can feel empowered to say the magic words, “I don’t know. Let me check on that and get back to you.” Remember, it is always better to share authentic and accurate information than incorrect information or speculation.

4. Clearly articulate the narrative.

For both the buyer and seller, it is essential to be able to articulate the narrative around why this deal, why now, and why this property is best in XYZ hands. “Keep in mind,” says Sarah, “people have spoken and unspoken needs.” Unspoken needs are usually driven by emotions, like fear. To clearly articulate your narrative, you need to drill down and find the precise emotion you’re after. “If you want to inspire your audience, that’s different from motivating them or energizing them.” 

With an M&A deal, addressing the other side’s unspoken needs goes far beyond explaining your unique capabilities and differentiated IP. You must also be able to demonstrate an understanding of your company’s markets, customers, opportunities, and competitive pressures. And telling the story of your company’s value within the context of the deal is key.

The bottom line: Despite the headwinds identified, the M&A outlook for 2022 is very good.

If you’re ready to ride the M&A wave this year, you need the right partners by your side. At Audacia Strategies, we’re prepared to work with you and your team as you navigate the next big deal. Contact us to discuss your M&A strategy.

Photo credit: Modern Businesspeople Having A Video Conference In A Boardroom by Jacob Lund Photography from NounProject.com

c-suite change

C-suite Change Can Be Energizing or Panic-Inducing. The Choice is Yours

Does this sound familiar? Your organization is one of the bright, rising stars in your industry. It has taken years of hard work, but you’ve finally reached a point where you have strong leadership across the board, a steady vision for the future, and everyone from the executive team down to the employees on the frontlines are working together like a well-oiled machine.

And then…the CEO turns in their resignation letter. Does the prospect of C-suite change send a shock wave of panic through the company? Or are you ready to guide everyone through a smooth transition?

If your initial response is panic, that’s okay. This is the perfect time (i.e., before this scenario becomes your reality) to come up with a plan. Let’s look at how you can reframe c-suite change as an opportunity rather than a potentially destabilizing event.

Revisit Company Culture for Successful C-Suite Change

First, recognize that C-suite change is a natural part of company evolution. The person you had steering the ship during the start-up phase may not be the best person to lead you through the next stage and beyond. Thinking about how far you’ve come and how your culture has evolved will help you choose the right CEO for this next phase.

Also, if you’re moving from a founder as CEO to a new corporate executive, you’ll want to consider how much of the company culture is tied up with the founder’s personality and whether that makes sense going forward.

For example, suppose your Founder and CEO is a literal rockstar. He plays the guitar and performs regularly with his semi-famous band. He has even been interviewed by Rolling Stone. It’s an interesting draw and has given the marketing team lots of fun campaign ideas. But is this crucial to the DNA of the organization? In other words, is it critical that the new CEO also play the guitar?

Maybe. Maybe not. The point is that you need to figure out what is part of the DNA of your organization and look for a new CEO that shares the same values — someone for whom your culture is authentic to who they are as a leader.

Why is culture so important when considering C-suite change? Well, it’s likely that culture is one big reason that scaling and reaching the point where everyone is working together like a well-oiled machine has happened. So as you consider the selection and managing of the C-suite change for customers, investors, and employees, keeping the culture consistent should be your first priority. 

How to Keep Company Culture Consistent:

Once you begin to see your CEO’s resignation as part of the evolution of the organization, you can turn your attention to deciding, likely with the help of your board, what is crucial to the company’s DNA. Take your time here because decisions about how to separate the former CEO from the company culture will determine whether stakeholders perceive the C-suite change as energizing or destabilizing.

Keep the following tips in mind:

1. Have a good sense of the culture as seen through the eyes of employees. 

Find a way to take the pulse of your employees. One good approach is to use an external team to conduct Voice of the Employee interviews. You may be surprised that what you think of as crucial to the culture of your firm is really hidden from your employees and vice versa. So this kind of research is hugely beneficial for smooth executive transitions.

It’s also important to announce the transition itself to employees at the same time as you announce the C-suite change publicly. If you announce internally and externally at different times, rumors will fly and rumors are a huge source of instability during big transitions.

We recommend having a specific employee communication plan to address key cultural issues and how the C-suite change will affect the organization from a macro perspective. Also, as soon as possible, set up a town hall meeting where employees can be formally introduced to the new CEO and have their questions and concerns addressed.

2. Ground everyone back into the company strategy.

While the CEO may be changing, the company strategy is staying the same, especially if we’re sticking with the scenario where everything is going well and the CEO needs to move on. This means it’s a good opportunity to go back to basics. 

Let your mission, vision, and values drive you forward. Get everyone to recommit to company fundamentals and talk openly about what is changing and what will be staying the same.

3. Be as honest and transparent as possible.

This third recommendation is a big one, so strap in. As soon as your executive gives you notice that they’re even thinking about moving on, you want to have a strategy in place. This will allow you to be as honest and transparent as possible. This goes for all of your key leadership, not just your CEO.

Perhaps you will want to call a board meeting to open discussions about all of the topics above. Perhaps you’ll want to make an announcement (internally and externally) early and reassure everyone that the transition period will last several months. Whatever your first move, having a Standard Operating Procedure (SOP) around C-suite change is a smart idea.

In a previous blog article, we talked about the elements that plan should include whether your C-suite change is expected or unexpected.

4. Know your game clock.

Timing is also important here. The more you can be in control of the timeline, the greater your ability to control the message of the transition. Unexpected changes can raise questions about the stability of an organization. One way to ease these concerns is to share (at a high level)  your succession planning process with key stakeholders so that they understand the corporate calculus behind the leadership selection. 

For public companies: if you have a planned transition with a good amount of lead time, it’s good to make this announcement as part of your quarterly reporting cadence. If the transition is unexpected, public companies will likely have to disclose the leadership change via an 8-K within four business days, but make sure to consult with legal counsel to determine your specific disclosure requirements.

5. Teamwork makes the dream work.

If possible, make time in your transition strategy to allow the outgoing and incoming CEOs to work together. If appropriate, having a “pass the torch moment” can be a critical element to  transferring credibility and trust from the outgoing CEO to the incoming CEO. Part of this strategy should include coordinating their narrative. As an example, the outgoing CEO may talk about why they built the company and why the new CEO is the right person to carry the mantle forward. This gives the new CEO the opportunity to share their own vision about the future of the company.

Finally, make sure your new executive is prepared to take over. Is the new executive on the same page when it comes to the company culture? Have you defined your key messages? Have you acknowledged that C-suite change requires an acclimation period that can take at least 30 days? Have you organized listening sessions and key meetings with stakeholders? Do you have a comprehensive introduction strategy?

For our private equity-backed companies: if your CEO has experience with public company boards and they will be transitioning to working with your private equity board, do they understand what that entails? This is a helpful resource to share from McKinsey

C-suite change can be a powerful signal of an organization’s evolution. If you’re ready to move into the next phase of your company’s metamorphosis, our team can help make the transition energizing instead of panic-inducing. Let’s talk about your next business transformation!

Photo credit: Jacob Lund Photography from NounProject.com

back to the office

3 Tips for Hitting a Home-Run As You Bring Your Team Back to the Office

As remote workers are being called back to the office here in the U.S., many are experiencing a reverse of the identity crisis we collectively experienced during the early days of the 2020 shutdown. Whereas when offices shut down we felt our routines being abruptly disrupted, now we have the opportunity to intentionally re-enter our post-pandemic work lives.

It’s time for leaders to consciously decide how to make re-entry as smooth as possible for their employees. And if it sounds like I’m asking you to come up with a strategic plan, that’s because I am.

See, re-entry is not something to be taken lightly. You can’t expect your team to go from languishing to flourishing overnight just because they’re back in the office. But if you send a message of realistic optimism. If you make it clear that this is a time to reset and build our future together, with time, you will see a new, stronger team emerge from the pandemic ashes.

So, let’s discuss your triumphant back to the office strategy.

Reconstructing How Work is Done

Despite all the challenges of figuring out how to juggle childcare while working and creating healthy boundaries around work, surveys show that most people enjoy working from home. A McKinsey study from June 2020 found that 80% of workers enjoyed working remotely. And while many now prefer to have the option of returning to the office, there’s still a strong preference (55%) for working from home at least two or three days a week.

The pandemic forced the question: is this really how work should be done? And leading organizations are taking this question seriously. They’re questioning assumptions about what employees need to do their best work and re-examining the role of being together in the office.

There’s, of course, no one-size-fits-all answer here. Reconstructing how work gets done will look different for every organization. this is about achieving your business and cultural outcomes. 

Get your managers and teams together (you want a diversity of perspectives!) and have a discussion around the following:

  • What are the most important systems and processes for each major business, geography, and function?
  • How can you boldly re-envision each of these systems and processes?
  • How does being physically present in the office enhance professional development?
  • How does being physically present in the office push a project forward at different stages? For example, previously, a business unit may have generated new ideas by convening a meeting, brainstorming on a whiteboard, and assigning someone to refine the results. A new process might include a period of asynchronous brainstorming across a digital channel, like Slack, followed by a multi-hour period of debate via video conference.
  • What values, practices, interactions, and rituals most promote the culture your organization wants to develop?
  • What suboptimal habits and systems can you do away with completely?

Of course, reconstructing how work gets done at your organization is no easy task. Undoubtedly, tough choices will arise and leaders will need to be empowered to make decisions that move individual business units and businesses forward.

In addition, it’s important to recognize that permanent change requires strong change-management skills. Both leaders and workers need to maintain a level of flexibility that allows for pivots based on what’s working.

The good news is that if you hit a home-run here, you will achieve the culture you’ve always wanted: an environment where everyone feels safe to enjoy their work, collaborate with their colleagues, and achieve their personal goals while achieving the organization’s objectives.

How to Hit a Home-Run:

1. Have a Reboarding Plan

Once you have gathered together your team to envision the future, it’s time to make that vision a reality. So, you’ll want to treat this return to the office like you would treat a merger or an acquisition or a new product launch.

Yes, making sure your return to the office is triumphant and not tragic is all about having a solid reboarding plan. First, consider how you do onboarding. Typically, this occurs at the very early stages of employment. But forward-thinking companies view onboarding as a strategic process that filters throughout an employee’s experience and can be leveraged at any point in a person’s career with the company.

This is where reboarding comes in. After a big transformation, like returning to the office following a pandemic, it’s time to reintroduce employees to policies and procedures that they may have let slide in various ways. It’s also an important time to introduce any new policies and procedures.

If you take a people-centered approach to your reboarding plan, you will be in a better position to help your employees embrace the new changes and make a smooth transition back to the office.

2. Lead with Empathy

Looking at the unemployment data and what’s happening with economic recovery, some economists have taken to calling this the “Take This Job and Shove It” economy. Employees want to feel valued and they seem to have little trouble quitting or moving on from positions where they aren’t feeling this way. A year of grieving and dealing with an elevated level of fear has reminded us all that life is short.

One way to ensure you’re recognizing the humanity of this moment and not simply focused on your organization’s bottom line is to lead with empathy. For example, instead of recalling everyone 40 hours per week and expecting a return to pre-pandemic levels of productivity overnight, consider spreading out the physical return and phasing in policy changes aimed at increasing productivity.

Some organizations are even anticipating a summer slowdown and intentionally working that into their strategic plans for the rest of 2021. Giving your team a break this summer is another way to show employees, who were stressed before lockdown, that you understand the toll the past 16 months have taken. After a true recharge this summer, everyone can return to work in full force this fall.

3. Communicate Well Both Internally and Externally

Above all, making the transition back to the office successfully will require strong communication guardrails both internally and externally. First, establish clear, regular, two-way communication with your team. This will allow employees to feel as if they are in the loop and that their input matters. Also, make sure not to limit communications to only what has changed. Talk about what isn’t going to change as well.

Second, make sure to communicate early and often. Once you have your reboarding plan in place, you can communicate that plan internally with your managers and employees. Make sure they understand what is happening when and what responsibilities they have within the plan so they can manage their own expectations. All of this should be firmly established before you start communicating externally.

Next, make time for collective venting and open communication. You want your employees to feel free to participate in any future changes and to get buy-in from them, they need to feel heard. Collective rituals are one way to help your team feel supported and heard.

For example, you could reserve an hour after lunch on Fridays where teams come together virtually or in-person for a group venting session. Allow everyone some time to check-in with each other about anything that’s causing them stress. Make sure to end the meeting with time for each person to express gratitude. Moving, in this way, from feeling stuck to expressing gratitude can help to navigate the range of emotions everyone experiences.

Returning remote workers to the office is a big transformation for any organization. Having a strategic plan in place gives you the best chance for success. With the above in mind, you’ll make strides toward achieving the culture you’ve always wanted and supporting your team as they re-learn how to thrive in our post-pandemic future.

It’s an exciting time! This is our chance to reset and intentionally redefine what work means to all of us. Audacia Strategies is ready to partner with you as you make the transition. Let’s chat about how to reconstruct the way work gets done at your organization.

Photo attribution: Team of investors meeting in corporate office with documents and laptop by Jacob Lund Photography from Noun Project

communications guardrails

Communications Guardrails: Your Key to Forward-Thinking, Innovative, and Grounded Messages

We recently posted this blog article about strategies for making your underlying messages consistent with how you want your brand to be perceived by the world. With the speed of information dissemination in our digital age, you can’t afford to be reactive. But being proactive is a real challenge too. Anticipating all the ways our messages might be received is a tall order.

However, there is another way to ensure you are shaping conversations, rather than allowing conversations about your firm to be shaped by those outside of your organization. All you have to do is come up with some strong communications guardrails and stick to them. Let’s dig in!

Communications guardrails? What does that mean? 

Communications guardrails are a list of do’s and don’ts that are unique to your organization. They let the world know what your organization does and does not stand for. You can think of guardrails as rules, but that makes them sound really restrictive. 

We prefer to think of your guardrails as well… guardrails. They are boundaries that keep everyone corralled just enough to ensure that the conversations you’re having both inside and outside of your organization are forward-thinking, innovative, and grounded.

Your guardrails will also act as guides as your communications evolve. They include your values, branding messages, and talking points, but we encourage our clients to go even further. To start, ask your team these five questions:

  • What are we actively doing to show our commitment to our purpose, vision, and values?
  • What are our firm’s priorities when it comes to communications?
  • What industry-wide beliefs and best practices do we accept?
  • What industry-wide beliefs and best practices do we reject?
  • Do we have a solid crisis management plan? (because if communications are going to go off the rails, it will happen during a crisis)

With the answers to these questions in mind, you can begin creating your own guardrails. 

Also, you’ll want to consider what has worked for you and your competitors in the past. But don’t forget to look outside of your industry for ideas too. If you want to be out front leading, you’ve got to think beyond those tired, worn patterns.

Finally, avoid the 7 Deadly Sins of Business Communications:

1. Pride: Lack of consideration for or understanding of your audience.

2. Envy: Trying to ‘copy and paste’ another organization’s messaging because it worked for them.

3. Gluttony: Know when enough is enough and skip the buzzwords.

4. Sloth: There are no real marketing “shortcuts” or “hacks.” You’ve got to put in the work.

5. Lust: Beware of falling in love with the latest trends or tools. Keep your communications genuine.

6. Anger: When communications are perceived as angry, defensive, or overly negative, your audience will tune out the message.

7. Greed: It’s okay to make the ask, but make sure you consider carefully who’s winning in the deals you make.

Time to Give Those Communications Guardrails a Stress Test

Once you have come up with your set of guardrails, the next step is to test them. This is yet another reason the guardrail metaphor is apt. Road crews don’t build guardrails and then put them out on the street without doing a proper stress test. 

In the same way, you don’t want to assume that your communications guardrails are solid and test them out in the “wild.” You want to test them internally first. 

One method we use with our clients here is the Murder Board. The term murder board (AKA “red team”) originated with the military, but it’s shorthand for creating a team of rivals or a committee of killjoys whose sole job is to poke holes in your team’s best ideas. It’s great not only for testing communications guardrails, but for any new idea you might come up with.

In short, the murder board is tasked with locating the problems, risks, and bugs insiders might miss. So bring your guardrails in front of a murder board.

Murder Boards are beneficial in a variety of situations related to communication guardrails:

  • When prepping crisis communications, the murder board can hep you prepare for any number of scenarios and develop do’s and don’ts for your CEO and spokespeople.
  • When prepping to talk to investors or analysts, the murder board can role play scenarios with your CEO to ensure she has answers to any number of “tricky” questions.
  • When prepping your sales team or customer service on the frontlines, the murder board can get them ready to reply to customers who can be some of the toughest critics, especially during a crisis.

For high-stakes communication situations, there’s nothing better than a murder board. Finding your communications guardrails is a high-stakes situation. Without guardrails, you’ll find everyday communications feeling chaotic and overwhelming and crises quickly spinning out of control.

When you take the time to create your communications guardrails with your team, though, you have the opportunity to shape the conversations you’re having and to lead your industry into a brighter future. 

What are your communications guardrails?

At Audacia Strategies, we’re used to fielding questions from executive clients about how they can be more aware of the underlying messages they’re sending. Our go-to answer is let’s work on your guardrails. Ready to see us in action? Contact us to schedule an introductory call!

rebuilding corporate trust

Rebuilding Corporate Trust: 4 Ways Business Leaders Can Bring About Real Change

As we slowly leave the pandemic behind and enter the rebuilding period, let’s not forget our responsibility for rebuilding trust in public institutions. With all the highfalutin talk about rebuilding society and cultural norms coming out of the pandemic, it’s tempting to point the finger at the government, NGO’s, and the media.

But we are at a unique crossroads where business leaders are positioned to bring about real change both inside and outside of their organizations. Want evidence? Look no further than corporate reactions to measures tightening voting accessibility. Just over a week ago, hundreds of companies and executives signed on to a new statement opposing “any discriminatory legislation” that would make it harder for people to vote. 

This type of overtly public engagement has become increasingly common over the past few years as corporate executives step into the trust gap vacated by government organizations. 

Earlier this year, global communications firm, Edelman, released its 2021 Trust Barometer and the results are revealing, especially when it comes to rebuilding public trust:

  • Business has a 61% trust level globally (that’s higher than any other institution)
  • 86% of respondents believe that CEO’s must lead on societal issues
  • 68% say CEO’s should step in when governments fail

We can point the finger at others, or we can embrace this as an opportunity to reshape relationships and build new communication paths providing benefits that will long outlive the current moment. Edelman’s Trust Barometer makes it clear which choice your customers and employees want you to make. So let’s look at the why and how of rebuilding trust.

Rebuilding Corporate Trust in Response to the Epidemic of Misinformation

How did we get here? If you were an alien landing on Earth today, you might expect to find people turning to governments and other long-standing institutions for guidance as we restart the global economy. However, the way governments handled the global health crisis has not engendered confidence in people.

Time Magazine nicknames the findings of the Edelman report the “Epidemic of Misinformation.” In the first half of 2020, public trust of governments did rise. Early on, both U.S. and Chinese citizens deemed the government to be the most fit institution to handle the COVID-19 pandemic. However, by May 2020, China and the U.S. saw significant drops in trust by 18 and 23 points respectively.

To explain these sharp decreases, Richard Edelman points to China’s use of censorship and U.S. officials’ touting of “miraculous cures” that were discredited while simultaneously diminishing the efficacy of mask wearing and social distancing in favor of reopening businesses. Edelman’s recommendation: it’s time to declare information bankruptcy

As trust in governments has diminished, trust in businesses has only grown stronger. Given that trust is the glue that holds society together, especially during trying times, leaders must take the initiative to rebuild corporate trust.

How Our Clients are Rebuilding Corporate Trust

Even before the pandemic, many CEO’s appeared to be heeding this call and stepping into their roles as “America’s new politicians.” In 2019, 181 of the nation’s top CEO’s agreed that “driving shareholder value is no longer their sole business objective.” This is a significant break with the past profit-above-all-else mentality.

And this shift, spearheaded by Business Roundtable Chairman and JPMorgan Chase CEO Jamie Dimon, reflects growing pressure from employees, social media, and customers to do more than increase stock prices. The pandemic and recent political events have only accelerated this shift.

At Audacia Strategies, we’re fortunate to have a front row seat to see this change in action with our clients. Here’s how our clients are stepping up to rebuild corporate trust one organization at a time:

1. Looking deep into the “soul” of the organization

Our clients are looking deep into the “souls” of their organizations to tap into their purpose. They’re asking: Why do we exist beyond profits? And what value do we add?

They’re also recognizing that often rebuilding corporate trust requires reaching out to customers and employees to ask for help. They’re initiating Voice of the Customer and Voice of the Employee studies to really take the pulse of their key stakeholders.

In many cases, though, rebuilding trust is perpetually aspirational. This applies not only to startups, but also to long-tenured companies. As the world changes, how we leave an impact can and must evolve too.

2. Knowing credibility matters

Employers are recognizing this moment for the opportunity to be a credible voice and to provide clear, unambiguous information for employees to follow — whether it relates to corporate strategy, benefits changes, or societal changes.

When organizations look at employees as humans, as opposed to money-making machines, they see beyond increasing productivity, profitability, and financial performance. They see how having empathy for what their employees have experienced in the past 12 months can open doors for the organization.

In the current climate, employees are exhausted from having to parse through health messages online, in their inboxes, on television, and in the media. Misinformation and disinformation have created a void leaving many without an orientation point from which to believe anything at all. Operating in such a gray area is exhausting and demoralizing.

Companies focused on rebuilding trust recognize the chance to fill this void for their employees (and customers) and gain credibility as a result.

3. Believing consistency is king

The quickest way to blow your credibility when it comes to communications is to broadcast inconsistent and sporadic messages. The old 7×7 rule is still a good starting point — but it doesn’t go nearly far enough. 

For our clients, we encourage a message architecture that ties every communication back to the organization’s purpose and vision

Overcommunication is key… but not via an avalanche of emails. Instead, use multiple channels and — most important — use live events whether structured town halls, small group roundtables, regularly scheduled staff meetings, or just chatting before the next Zoom call. All of these are opportunities to reinforce a consistent message. And that leads me to…

4. Proving trust is not a one-way street

Employees must also have a voice and provide feedback in real time.  And although annual engagement surveys can help, these shouldn’t be the only means of listening. Some ideas:

  • Hold open Q&A sessions
  • Use your internal communication tools like Yammer, Slack, or Google Hangouts to solicit and facilitate feedback
  • Share pulse surveys
  • Voice of the Employee (VOE) research 
  • Have an open inbox/phone line/door for receiving and sharing feedback

When your employees feel heard, they trust that you’ll share with them what’s working and what’s not in a constructive way. They trust that you’ll share the questions and suggestions you receive. And they will trust you to create a roadmap forward and share your progress regularly. 

Rebuilding corporate trust is hard work. It’s sticky. It can be emotional and truthfully, it can be exhausting for the leader who often says, “but I’ve said this in the last 5 meetings — let’s move on.” Remember, though, consistency is credibility and credibility is trust. 

As leaders, we don’t have the luxury of passing the buck here. Rebuilding public trust starts with us. If you’re ready to boldly step into this new era of radical transparency and corporate trust, your partners at Audacia are here for you. Contact us to discover how we can work together. 

Photo credit: Group of happy people working together in an office by Flamingo Images from Noun Project