By Fraser P. Seitel
As a Hewlett-Packard shareholder, I hope new CEO Leo Apotheker turns out to be the world's greatest business manager. But as an internal communicator, he's an idiot.
A bit harsh perhaps, but because of the new chairman's predilection to display his ire on paper, H-P's stock got pummeled last week.
CEO Apotheker, in a "confidential" email sent to 10 senior H-P executives prior to its quarterly earnings announcement and investor conference call, warned of "another tough quarter … (in which) we must watch every penny and minimize all hiring."
Those are just the kind of words that sends Wall Street into a tailspin and necessitates moving up earnings announcements and conference calls. (All of which happened after the H-P memo was published in its entirety by Bloomberg.)
Even worse, Apotheker's memo repeated what the CEO had just verbally transmitted to his top brass at an H-P Executive Council meeting. And to make matters worse, Apotheker went on CNBC to announce he would investigate the leakers! (I told you he was an "idiot.")
Maybe that's the way they do things in your native Germany, Mr. Chairman, but this is America -- land of leaks and skittish shareholders. So next time, stifle yourself and follow the following half dozen rules in writing – or not writing! -- internal memos.
• Rule #1 - Aim high
A memo should be written to superiors; in the case of Mr. Apotheker, his board of directors or shareholders. A memo shouldn't be written to subordinates.
Subordinates should hear from supervisors in person. Memos are impersonal vehicles, inappropriate for supervisor-to-subordinate communication.
Apotheker's initial instinct to verbally communicate the bad news to his top aides in the privacy of a management forum was the right one.
Why he felt it necessary to underscore the urgency of his words with a memo seems to suggest that he lacks the confidence that his top lieutenants could accurately retain the message and transmit it down the line.
• Rule #2 - No bad news
Memos are not the place for "bad news." Again, that should be done verbally. Memos lack the detail and nuance that are necessary to understand the specifics and implications of the bad news pronouncement.
By contrast, memos are the place for gratitude and commendation, as well as rule changes and notices.
When Apotheker warns his colleagues that "the headcount plans we have are unaffordable, given the pressures on our business," he is announcing dire news without explanation – a surefire recipe for misunderstanding and wrong conclusions.
• Rule #3 - Confirm don't announce
Ditto, using a memo to "announce" anything invariably leads to problems.
For example:
How are we to interpret the staffing announcement?
What does it mean to job openings in the pipeline?
What if we've already budgeted for new headcount?
It's one thing to "confirm" what has already been announced, but quite another to declare new policy via memo.
• Rule #4 - No 'I'
There's no "I" in "team." But there is an "I" in "Idiot."
Using "I" in a memo from the top sets up a dangerous division, particularly in a company seeking to become more efficient. It's as if the CEO sees the employees' task as separate from his own; him against them.
When Apotheker says, "I can't stress enough the need to set the right tone...." the implication isn't exactly that "We're all in this together."
• Rule #5 - Distribute to all
People don't like to get frozen out of memos. If my supervisor can see it, why can't I see it?
"For your eyes only" memos, like the H-P chairman's, are fraught with peril. What if somebody gets a copy by mistake? What if that "somebody" is so irritated that he or she leaks it in spite to, oh let's say…Bloomberg?!
The best approach is to direct the memo to the entire staff. In this case, there's nothing wrong with reminding everyone that the environment is uncertain and that we have to pull together to sacrifice to make our numbers.
• Rule #6 - Count to 1,000
The best memo is the memo unwritten.
Any time you commit something to paper – or email, text message or post on Twitter or Facebook – you are memorializing a missive that can get you into beaucoup trouble.
It's always better to take a breath, walk away, and then consider whether you have to put something in writing.
And if you doubt the negative impact that memos can have, take a peak at my sagging H-P portfolio.
So the next time the Hewlett-Packard CEO believes he simply must admonish the troops in writing, let's hope that first he goes "Ein, Zwei, Drei, Vier……"
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