Part 1: Insights with Bruce Zanca

Bruce Zanca, is a WPNT Ltd. senior associate. He has worked for two White House administrations and as chief communications officer for leading public companies. In the first of a two-part series, Bruce shares some insights from his career with particular importance to communicating in uncertain times.

The pandemic of 2020 has resulted in downsizing and layoffs on a scale not see for some time. Communications around this and other change initiatives, where uncertainty is a hallmark can be difficult. How does management balance the importance of transparency with employees and other stakeholders and keep the workforce motivated, while often being constrained by things that can be disclosed at certain times?

Employees want to know what a change will mean for them. They’re asking themselves is my job safe? What will change in my life? Customers want to know if their service, products, or pricing will change. Investors are concerned about the outlook for the business. It’s important to be as timely and as transparent as possible. Too often managers craft messages from the company’s perspective without forethought for the target audiences concerns. Even though you might be constrained by “quiet periods” and confidentiality, be prepared to communicate with stakeholders as quickly as is practical. Make certain that key communication staff are “inside the loop,” and are preparing your talking points and communications with forethought. This will allow you to tactically communicate with your target audiences as soon as is practical.

You’ve talked about how managers must be prepared for fallout from difficult communications? What do you mean by that and how should they prepare/cope?

Most thoughtful managers, if they take the time, can anticipate what the difficult questions will be. When doing investor relations planning for public companies I would always anticipate analyst questions for our quarterly earnings releases and calls. Management could then follow crafted guidance to answer the questions. We would always prepare cheat sheets of key metrics, figures and statistics such as: Cash flow, sales pipeline, deal costs, quarter over quarter and year-over-year financial results. These and other key statistics were always at our fingertips so management’s answers could flow smoothly and consistently. Following the who, what, why, where and when rubric to anticipate questions is a great preplanning exercise. Honesty is important. If you don’t know the answer to a question say you don’t know, and then follow up.

You had a decade in government with three administrations and more than 20 years in private industry. What is the single biggest difference for communications and building connection with stakeholders between the two?

Unfortunately, in my view, political communication has changed drastically in the last 30 years. This is never been more evident than during the Trump presidency. Communication with the news media has gone from adversarial to combative and even downright hostile. When I worked for Ronald Reagan and George Herbert Walker Bush there was a healthier mutual-respect between the news media and the administrations. Modern social media tools such as Twitter have allowed politicians to dis-intermediate the mainstream news media. Daily White House press briefings are now the exception rather than the norm. A political figure can now make statements directly to the public in 140 character tweets. Journalistic organizations and standards have changed as well. Fact checking in multiple story sources, for the most part, are a thing of the past. In a real sense, each side panders to their own “base audience” and communicates accordingly.

The good news for business communicators is that it does not have to be so combative. That’s not to say that you don’t have to be buttoned up in your messaging. Outside audiences like buy and sell side analysts, activist investors, and trade journalists are always going to treat company messages with scrutiny.

Accordingly, in the private sector, you have to work hard to cultivate relationships with thought and opinion leaders. This means having management’s commitment to take the long view in communicating with interested parties and stakeholders on a regular and frequent basis. The management team should take time to cultivate relationships with buy side and sell side analysts, business journalists, and direct with customer contacts. This will pay communication dividends in good times and bad. When a company is on a good trajectory and having success sharing those successes with interested stakeholders builds trust and emotional equity over time. Forthright and honest communications is paramount to success. When the company is having tougher times like a financial struggle or bad news the earlier work of establishing a relationship can help make sure the tough times get a “fair treatment” with the stakeholders.

Let’s talk politics. Any presidential candidates, still standing or not that you think is an effective communicator?

Most politicians today disappoint me. I find the partisan rancor and hatred disheartening. Although I’m a lifelong Republican, I don’t care for President Trump’s manner or style. I don’t think the Democrats are any better. Among the Democratic candidates I think Sen. Elizabeth Warren, Sen. Bernie Sanders, and former New York Mayor Michael Bloomberg are all effective communicators. Senators Warren and Sanders both use a grass roots communication strategy to effectively communicate with their base supporters. They leverage a mix of both social media and traditional media coverage to convey their message. Mayor Bloomberg is more of a traditionalist. He uses the mainstream news media and purchased advertising campaigns to project his message. His messaging is slick and buttoned up.

In all of your career, what was the most difficult communications challenge you and your team faced?

I once worked for a public company that missed analyst expectations in the first quarter after their IPO because of an accounting error. The CFO misjudged which quarter to book an accrued expense and the timing error in judgment resulted in the company missing financial earnings-per-share (EPS) consensus estimates by several cents. On the heels of a successful IPO, street expectations of success in the quarter were strong. Consequently, the share price fell sharply after the earnings report. The challenge was that the fundamentals of the business were strong. A pro forma explanation of the mistake showed results better than what was reported. Since the company was new, there was not a strong research following or advocates for the company in the marketplace. So the work of correcting the misimpressions fell on the company CEO and the investor relations team. We had reported earnings prior to market opening. We worked the phones all day answering the heated questions of disappointed investors. It was a very long day answering the questions of disappointed investors. Some companies might have left the calls unanswered. But we took every call and answered every question. The CFO left the company a short time thereafter. It took us about a year to recover from the mistake and to recover our credibility. The long road to recovery was built on quality communication and excellent business execution over the following year.