Ed Roszczka, president of Cambridge, Ont.-based Punch Integrated Communications Inc., recently spoke at a Toronto conference on employee communications. Punch, which was founded in 1997, is based on the philosophy that good marketing starts at home. In other words, your employees have to buy into your message first if you want your customers to do so as well. Pipeline spoke to Roszczka shortly after his seminar about the disconnect between internal and external marketing he discovers at many of the large IT firms and other businesses he consults for.
Pipeline: Tell me a bit about you and how you got to what you’re doing at Punch.
ER: Punch was founded in 1997. At that time, we were doing primarily traditional marketing and advertising; for the first few years the bulk of our revenues came through the marketing and advertising side at firms such as Rogers, IBM and Thompson. It was in the very early stages of dealing with Rogers I recognized the need for some of the internal side. I had been doing some consulting in publishing, aiding a couple of agencies doing the integration between new media and traditional print in the mid-‘90s when the arrival of the Internet put a number of companies and corporations in a scramble to understand what it was. They didn’t want to miss the boat. Not many companies had much experience, but I had been doing both print and online print campaigns for six years, so when I was working with Rogers and doing a traditional marketing research component to understand how to launch some of their consumer products to the market I quickly realized with the development of communications programs there was a lot of disconnect between the management team among what price points should be and what the actual service or product offerings should be. The right hand and left hand were not speaking or in agreement, so at that point I recognized the necessity for putting in place some internal communications in combination with launching some of that consumer stuff.
Pipeline: What percentage of your business is focused on external communications such as marketing and what percentage is focused on internal employee communications?
ER: About five years ago we decided to flip-flop, so now we do about 90 per cent of our business internal.
Pipeline: What is the theory behind what you do?
ER: Our philosophy would still be based on much of the traditional marketing principals. Most companies when they launch a service want to delve into getting the surface level or background information together, such as ‘what’s our demographic, what are some of their buying habits,’ and then they delve right into communications and channels. But in my experience, they don’t go deep enough in getting that background information. Then the question becomes why did the communications program not work as effectively? Could we have a higher response rate and how does that response rate convert to sales? In marketing and advertising it is very difficult to measure true success – you can do it through circulation audits and things of that nature, but to actually demonstrate a conversion rate to sales is much more difficult. So on the internal side if we’re asking somebody to put in X dollars for a budgeted program, we want to be able to demonstrate what kind of return they’re going to get. We started to delve deeper into research and measurement as a format and basis for that. We delve fairly deeply into measuring attitudes, beliefs and perceptions, which are the influencers for behaviour. Somebody who acts in a certain way does so because they have a certain belief about something. So we created some really detailed questions and research methodologies that allowed us to extract the specific attitudes and beliefs that were the basis of behaviours. Once we understood those aspects, then we would sit with the organization and look at their operational concerns and issues, and say, ‘you’re looking to achieve X, Y and Z. Based on the goals, here are the issues you’re telling us are occurring.’ And based on that we create or develop a communications strategy using demographic information to determine which vehicles make more sense in terms of the channel or the medium for delivery, but we also premise the why about how we’re going to define the content or the messaging, and that’s a more critical component. Then we ensure we deliver the messaging and design and develop the entire communications program just as we would in a traditional advertising campaign at this point. We look at every opportunity to ensure the message is reaching our audience, that it has impact.
Pipeline: Can you give me an example of a problem and how you resolved it?
ER: In general we have a lot of clients who want to improve the bottom line and that might mean many different things. Let’s assume they have an issue with some of their operational items. For example, they might have an issue where certain product is arriving every day at ABC Co. and their thousands of stores across North America. Let’s say 1,000 pairs of jeans are arriving at the warehouse store, but at the end of the day when they do their inventory, there are only 500 pairs of jeans. Where did those 500 pairs of jeans go? We have a problem of losses; the question is, where did they occur? They can backtrack and look through some of their paperwork and inventory system, their merchandising and their logistics side. They can go through a couple of mechanical aspects, but usually they don’t find their answers there. So they realize there’s an issue. If we were to ask the executive team what they would like us to do, they would say they would like us to tell the employees we need to fix this. We do know we’ve lost 500 pairs of jeans but we don’t know why. You can make an assumption the employees don’t care; they receive (the order) in the door and nobody’s checking the paperwork, so they sign for it and in it comes, or they’re not putting them all on the floor or they’re not stored properly so they’re lost somewhere in the system. So what we’re going to do is actually go find out. We talk to all the employees who might have occasion to be responsible for these jeans, and we ask them a series of questions, such as ‘how do you do your work, walk me through your system, are you aware errors like this happen?’ They might say, yeah, but nobody checks so we don’t bother. Now you find out the attitudes towards the issues. Given that information you can imagine the kind of stuff that comes out from those kinds of discussions and explorations. Now we have both qualitative and quantitative information. So we all agree the issue is you’re losing a lot of money on stock and warehousing. The interesting part is that not all your employees were aware this was a problem, and those who were aware say it’s a problem because nobody cares, and if nobody cares, why should I? And everybody else is taking a pair of jeans, so I will. Now that we know what they’re thinking, we have the opportunity to shape and form communications to change those attitudes to affect certain behaviour towards a certain corporate goal. We’re known as the company that gets employees to do what you want them to do.
Pipeline: So in that example what was the outcome?
ER: We would have the communications rollout and since we had a really good snapshot in terms of our measurement, we’ll go and measure again the improvement we’ve seen and correlate that back to the metric. Let’s say we’ve seen a decrease in the number of jeans lost – we can correlate that by going back and measuring attitudes, beliefs and perceptions again. This case is ongoing. Another example: one of our Canadian clients had store discounts for employees. They had loss issues and general merchandise problems and they couldn’t pinpoint what (the problem) was. They had made a certain assumption that employees were only working there for the discount on the clothing, that it was only a part-time gig for them so they were really only there for the discount on the clothing and that the money they made was spent going to dance clubs or for beer – so they really didn’t care. This is what the executive team told us, and if we had taken that at face value, we would have designed a communications program that probably would have said, please help us, thou shalt not steal, thou shalt follow procedure. Rather than doing that, we went and spoke to those employees and here’s what information actually came back: No.1, the money they were making at this job was not for beer money – it was actually for big-ticket items like college or university, a trip to Europe or buying a vehicle. As a result of saving for those big-ticket items, they were very conscious about the hours they got and careful to try to get as many hours as possible, because they were goal-oriented so they were concerned about what was happening at the store and how they could improve it. The most important element was the fact they weren’t there for the discount — the reason they worked there was because they loved the fashion. That changes everything because now they’re choosing to work there because they love it. Now we have real information and we can go out and create the communications program. The net result of that effort was a 92 per cent increase in the retention of the messaging and comprehension of their role to affecting that outcome and that resulted in a net decrease of 25 per cent of the problem in that year. So we’ve drawn a correlation between measurement of attitudes to linking that to the operational issues occurring. The losses were due to internal theft on some occasions, paperwork errors, external shoplifting and a number of other things from the operational side.
Pipeline: How does a company’s external marketing strategy relate to their internal employee strategy?
ER:Often they are distinct and that’s the problem because from a customer relationship standpoint it’s imperative that you link the promise you make to your customers to the experience they actually have when they come into your doors or on the phone or whatever the medium might be, and this is where they’re falling apart. Companies are spending so much time and energy on their external marketing program. My example with Rogers way back when was when they were launching a new consuamer product, they spent so much time and energy in trying to understand whether to launch a red product or a blue product when the internal team had no idea what the red product or the blue product did and what the differences were and whether they agreed it should be red or blue. I don’t mean just Rogers — every company is doing this; they’re missing the boat. So the issue of external promise has to be aligned with internal efficiency and delivery so when you spend $1,900 on a laptop from Dell and they promise you this, this and this and you don’t get it, you’re going to be reluctant to (do shop there) again.
Pipeline: Once you are gone from a site, does a company’s marketing team get involved in the effort at all?
ER: No, often there is a disconnect there as well. There are a few people in the management of brand and corporate promise who get this stuff. I think everyone understands it and I would say over the past five years as we’ve really focused on that internal aspect we’ve come to see greater acceptance of that notion. The problem is there’s no dedicated captain of resources internally. Marketing doesn’t own it, communications doesn’t own it, HR doesn’t own it so we find it ends up being a collaboration on several different fronts. This is where the opportunity for a company like ours is wide open because we end up taking that and controlling and managing it on their behalf by involving their various components.
Pipeline: You say it’s all about spin – aren’t a company’s employees the first to recognize spin and be a little cynical about it?
ER: The reason it’s not spin in the truest sense of PR and journalism is we’re actually going to the root cause. We’re hitting something that affects their behaviour. If you recall the seatbelt campaign – the message wasn’t you would get a fine, the message was you could fly through the windshield and hurt yourself or someone you love. So they went to the root cause of defining the problem with a message so simple and clear that the takeaway subconsciously was, ‘I need to wear my seatbelt.’ Here’s an example of influencing people’s behaviour in such a way that it’s not spun, it becomes natural because you have affected something about their beliefs, their attitudes and their perceptions. The wool is not being pulled over their eyes.