17 Oct 2014
By Simon Roche
Whether it is the strength of the Kiwi dollar putting the squeeze on our ability to sell our goods overseas, cheap Chinese imports cannibalising locally produced goods in the domestic market or the proliferation of technology eroding the demand for traditional locally made products, the manufacturing sector has felt its fair share of pressure lately.
While Business New Zealand tells us as recently as August that the manufacturing sector continues to show expansion, the stats behind that are not so rosy. A Business New Zealand Performance of Manufacturing Index (PMI) score of over 50 does indeed indicate that manufacturing is showing expansion, with a sub 50 score indicating decline. The July PMI sat at 53, down 0.4 points from June. By the same measure production dropped 1.9 points to its lowest point since March 2013, employment dropped 1.4 points and deliveries were down 1.9 points, all in July.
In our business we've seen first hand a number of Kiwi manufacturers make the tough decision to restructure during 2014 and in some cases that has meant redundancies for 100 workers or more - a distressing situation for all involved.
What is interesting is how that news has been received, by the affected staff themselves, the customers and suppliers of the businesses concerned and even the media.
When you lay off 100+ workers, it is a bad news story by anybody's standards. Add to that the fact that the workers have been part of the affected company for 10, 20 or even 30 years and may find it tough to find further employment and the story just gets sadder.
For a Manager or CEO to have to front such an announcement may seem like their worst nightmare but it doesn't have to be. What's become clear is that smart communication is making a difference and traditionally bad news restructure stories can turn into opportunities.
That's smart communication - not spin. Spin a restructure and 120 job losses any way you want - it still adds up to Kiwi workers out the door and nothing's going to hide the gloom of such a situation or make it better for the affected workers and their families.
But a thorough, well planned approach to communications can make a huge difference to the way a story is received. It's about understanding the detail of exactly who you need to communicate with, as well as what the methods and messages need to be. Not to mention timings and range of other considerations. There is a lot to think about but it is very doable and investing in a thorough communications plan does generate very significant returns.
Recent examples of exactly this approach have turned up some rather remarkable results.
In one case the story of a local manufacturer laying off 30-odd staff prompted a call from a media outlet who wanted to profile the business because it would be interesting to their readers. Another example prompted an influx of sympathy emails from the public, with some touching and pertinent comments about the brand which can be used for future positioning. That same example brought a call from a national media outlet offering to run a feature on the company and the importance of Kiwis continuing to support it and other local manufacturers facing a similar plight. In all cases the result was sympathy and understanding from all audiences and these surprising opportunities to boot.
What these examples had in common was not good news stories but a smart, well planned approach to the way they told their bad news stories.
It makes all the difference.
Top tips for Restructure Communications
The three Ps: Plan, Plan, Plan - Your most effective weapon in your restructure communications arsenal is the well thought out, detailed plan of attack. It's all about the detail.
Know your stakeholders - Document your stakeholders in a comprehensive list of anybody and everybody who is likely to be affected by your restructure or have an opinion (positive or negative) on it.
Manage the risks - For every group of stakeholders there will be risks. Brainstorm them, document them, prioritise them and tailor your communications to mitigate them. Work out exactly how and when you will communicate with all stakeholders.
Front foot the media - Tell your own story as transparently as possible before someone else gets out there with a different version and sets the tone. Make sure your storyteller is media trained.
Follow up - Talk to your stakeholders following your restructure announcement and get their feedback on the process etc. These people are critical to the future of your business and this is an opportunity to keep them engaged.
Simon Roche is a Senior Account Director at Wright Communications
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