ANALYSIS: Challenge mounts for Corus internal comms

Corus's head of company comms Helen Wiliams talks to Andy Allen about how the company is handling its internal and external PR challenges as losses mount at the steel giant and further jobs are axed

It's hard to overstate the corporate comms challenge facing a company that has just announced a loss of nearly £400m for the second year running, a massive restructuring programme that could lead to thousands of job losses, and the resignation of its CEO.

This, however, was the scale of the problem facing Corus's in-house corporate affairs team when its annual results, announced last week, proved even worse than expected.

Talking of how 'Corus's UK losses have to be reversed', Chairman Sir Brian Moffat outlined that this would 'inevitably lead to significant further capacity reductions and concentration of operations onto fewer sites', for which read job losses and closures. Later that day, chief exec utiveTony Pedder fell on his sword.

Soon after, the tension between Corus's English and Dutch arms was made painfully apparent as the UK business spoke publicly of how the Dutch side had blocked the sale of two plants, deepening its troubles.

Corus was formed in 1999, when British Steel merged with Dutch company Hoogovens.

The overall tone of the announcement itself was drastic enough, but Corus had not actually said how many redundancies would take place, or where.

The media, however, quickly filled the information vacuum with speculation that up to 4,000 jobs would go, with plants at Redcar on Teesside, Scunthorpe in North Lincolnshire and Port Talbot in South Wales most likely to close.

It all complicated the internal comms challenge facing head of company communications Helen Williams. Corus's in-house team - led by director of corporate comms David Jackson - had already held national and local briefings to persuade the press to refrain from speculating about figures.

They had met with some success among local media, but little regarding their national counterpart. This threw the onus on to internal relations to reassure workers and restore morale.

Williams says she was fully aware of the dangers to morale of workers hearing the news - along with unofficial figures - on the 7am news (when the announcement was released).

Yet regulations surrounding the release of stock exchange information meant it was impossible to alert staff earlier, and shift patterns meant many would not be at work to hear the announcement from the company.

Instead, Corus fell back on its procedure in such circumstances - employees know that as soon as the announcement reaches the stock exchange it will also be placed on the company intranet and website. A series of cascade briefings were held throughout the day to counter press speculation of exactly where and how deeply cuts would take place.

Internal comms specialists stress that when going through this kind of corporate trauma, there are several key rules to follow. Be as open and honest as possible, one says, even though due diligence and consultation often means companies are unable to be immediately exact about job losses.

Set a precise timescale for announcements - and stick to it.

At the same time, a mistake by many companies is to make provision for those losing their jobs through redundancy support programmes while forgetting 'the survivors' who will stay on, often facing more work and an uncertain future.

However, the fact that Corus's restructuring plans are dependent on an extensive refinancing programme to be agreed with banks, meant it was hard to give an exact timescale, Williams says.

'What we're trying to do is manage expectation by saying that there won't be one big announcement that will have a major impact in one area,' she said. Announcements are likely to be phased and unlikely to start for at least two months while the refinancing is arranged.

Corus has recent experience of how to handle job losses. In 2001 6,050 jobs went - mainly in Wales.

Reflecting ruefully on this fact, Williams says it meant, at least, that the company has an evolved support system in place to retrain ex-steel workers and invest in new businesses set up by them, such as UK Steel Enterprise. Counselling would also be provided for those departing - and those staying, if required.

Another important element of the internal comms strategy was to make sure senior management were as visible as possible, conducting extensive site visits and stressing that the restructuring would be handled as much as possible through voluntary redundancies.

While there was inevitably press attention around the compensation departing CEO Tony Pedder would receive - estimated at around £500,000 - this was relatively muted.

This will have come as little consolation for a company that has seen its reputation slide from being a stalwart of UK manufacturing to a basket-case of Europe's old economy. The reputation challenge is not over yet.

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