ANALYSIS: Client Profile - Corning: keeping its communicationscrystal clear

Corning has been selling its switch from glassware to optical

networking, but now that the telecom sector has cooled, Robin Londner

finds that the company has been forced to think again.



Lucky in cards, unlucky in love, telecommunications company Corning has

been effective in PR, but unfortunate in timing.



Once known for top-quality glassware, the 150-year-old Corning switched

its focus in Spring 2000, joining the hot telecom sector just as it

began to cool.



Moving glass expertise to optical networking, which entails delicate

glass work, Corning promoted its change in focus from pots and pans to

liquid-crystal displays and flat-panel screens.



Analysts and reporters covering the NYSE-listed stock bought the story,

and gave the former cookware company high points in its new sector.

Though Corning broke into big money by mass-producing light bulbs, its

long history has given it some leeway with skeptical reporters used to

dealing with fly-by-night start-ups.



Dow Jones News Service telecommunications reporter Johnathan Burns

explains: "The fact that Corning is old makes it seem like a reliable

company, and you tend to take them at their word as opposed to companies

that have not been around for a lot of years," says Burns. "They don't

have the start-up feel a lot of telecom companies have."



However, the telecom market has continued to slow, partly in response to

the September 11 attacks, and because Corning has been forced to stop

most production of optical fiber until 2002 and cut 12,000 workers (28%

of the 43,000 workers it had at the beginning of the year).



Corning's own corporate communications staff did not go unscathed. The

New York-based company had a PR budget of over $1 million and

numbered 24 people, plus support staff. Layoffs have affected the

communications staff, though VP of corporate communications Dan Collins

will not disclose details.



Collins says the challenges he faces are intriguing. In the first half

of 2001, his story was the company's transformation into a telecom

leader.



Since then, he has had to redesign his internal and external

communications.



In the aftermath of the terrorist attacks, Collins has spent much of his

time focusing on internal-only communiques of compassion, and has only

more recently been turning the spotlight toward Corning's other

businesses, such as environmental technologies and display panels.



"The first week after the September 11 attacks, we were in crisis mode,"

says Collins. "We had to look at our travel policies and security

measures, as well as individuals stranded overseas or not in their home

base. We had to tell them how the company would support them and get

them home."



Keeping employees informed



Corning's corporate team focused on what Collins terms "a relentless

program of communications internally." Every two weeks, employees

receive an e-mail from CEO John Loose, detailing the current business

environment and how Corning is performing. And every 10 days, employees

receive a voicemail from Loose and division heads informing them about

company developments.



Open forum employee meetings, which allow staff members to air their

grievances and make suggestions, used to be held once a quarter; now

they're held every six weeks. Various Corning business leaders also

answer Q&As posted on the company's intranet to give employees a feel

for what's going on in each division of Corning's businesses.



"We have communicated that these are unusual times," says Collins. "The

decisions made by the company to reduce the workforce are important to

the long-term survival of the company. As a company, we've taken our

recruiting staff, which a year ago was out recruiting thousands of

employees, and we've turned them around into an organization called

'Talent-to-Talent.' They take affected employees of workforce reductions

and help them to find new employers."



Reworking external communications



The events of September 11 have also led to Corning to refocus its

external marketing strategy.



Jennifer McNeil, VP at Brodeur Worldwide, corporate agency of record for

Corning for the past two years, says, "They did suspend their national

advertising, but they still do product and divisional advertising."

Media relations also took a back seat during that fateful week.



Moving forward, McNeil says, "We're continuing to speak to the major

media as we have news and developments. We have a story to tell in terms

of Corning's optical strategy, and we've also started turning up the

heat on their story of diversity, such as their liquid-crystal display

business, which has been strong."



The layoffs have not affected the structure of communications, says

Collins.



Paul Rogoski is director of external communications, while colleague

Dave Kaplan, director of corporate communications, handles crisis,

financial relations, and inter-action with the board of directors.

Monica Ott heads media relations, and each of Corning's six primary

businesses has a senior manager for communications. Corning cable

systems, Corning optical fiber, Corning photonic technologies, and

Corning advanced materials (liquid-crystal display and flat-panel glass)

are the major interests, while Corning life sciences (micro-ray and

biotechnology work) and Corning environmental technologies (ceramic

substrates for catalytic converters) are smaller businesses.



Collins says there are two secrets to his success. First, when he was

brought in to reshape the company's communications in anticipation of

the rebranding from glassware to biotechnology, Collins promoted many of

the current corporate communications staff, and then brought in new

people to enlarge the department. In addition, Collins says the quality

of past media relations campaigns has helped the company retain its

reputation, despite the telecom sector's overall downturn.



"Our reputation hasn't been hammered as much as others, which I think is

driven by the fact that we spent a lot of time managing that reputation.

Being forthright with reporters really helped us in the long run," says

Collins.



Dow Jones' Burns agrees, praising Corning, while in the same breath

predicting continued gloom for the telecom sector. "I think they're a

pretty easy company to talk to," he says. "Investors respect a company

for being straightforward and honest."



But will they invest in a company that continues to lower earnings

expectations?



Corning posted a $220 million third-quarter loss in October, and

saw its shares fall by almost 5%. The company did not offer analysts an

outlook for 2002, so Corning may have to wait a few quarters for

investors to get excited about telecom stocks again. But Burns predicts

that as long as the company keeps its information channels open,

investors will return to Corning when their eyes are re-opened to the

wonders of optical networking.



CORNING

VP of corporate communications: Dan Collins

Director of external communications: Paul Rogoski

Director of corporate communications: Dave Kaplan

Manager of media relations: Monica Ott

Manager of corporate marketing communications: Beth Damm

Manager of internal and executive communications: Anne Kenlon

Outside Agency: Brodeur Worldwide

Budget: Over $1 million



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