FOCUS: BUSINESS TV - When the going gets tough, turn to the telly

Internal TV networks which keep lines of communication between the

boardroom and the shop floor open can save the day during times of

crisis. Phoebe Gay looks at who’s switching on.

As British Airways surveys the wreckage of its attempts to convince its

staff of the need for a pounds 42 million cost-cutting exercise, its

management may well be wishing that it had got its ambitious Business

Television (BTV) plans off the ground earlier.

British Airways has been working with CTN over the last two years in

developing BATV. It initially ran a 10-day trial in January last year

showing a twice daily programme, and it is aiming to roll out a daily

programme to broadcast to its 55,000 employees around the world -

although no firm date has yet been set for its launch.

It is arguable that such a powerful and immediate internal

communications tool might have helped British Airways to communicate

more effectively the need for change at the company, and perhaps helped

to prevent misunderstandings between the unions BASSA and Cabin Crew

89.

However, CTN has been producing programmes for BA on an ad hoc basis, to

give information on financial results, for example, and CTN says that

ultimately the system could be used to handle internal communications

where appropriate in crisis situations.

In the early days, BTV in the UK was mainly used as a vehicle for car

manufacturers to communicate with their dealer networks. But BTV has

moved on. It is now becoming an integral part of internal communications

within organisations and it is beginning to play a bigger role in areas

such as crisis and issues management.

’Television is the most powerful communication tool and people say that

they get most of their news from the television,’ says Steven Watson,

managing director of CTN, a joint venture between Burson-Marsteller and

ITN.

’The real benefits of business TV are that it offers immediacy,

objectivity and interactivity. BTV leapfrogs other means of

communication and gets vital news to the coalface rapidly.

’When a company has to deal with an issue or a crisis, BTV provides the

communication vehicle to get that need-to-have information from the

centre to the constituent parts of the organisation,’ says Watson.

He cites the legendary example of merchant bank Merrill Lynch reacting

quickly to the Black Monday stock market crisis in the US when billions

of dollars were being wiped off share values.

Merrill Lynch used BTV to communicate with all its dealers to reassure

and inform them what the company would do over the next few hours, thus

giving the bank an edge over its rivals.

Phil Blundell, managing director of the Edge Picture Company, agrees

that BTV is vital in making sure employees are the first to know about

news or events. ’Letting your employees know shows that their opinions

are more important than the press,’ says Blundell.

’Business TV is a good vehicle for launching new products or passing on

a hot piece of news, as well as for crisis management, training, or

explaining financial results or a takeover,’ he adds.

Express transportation company Federal Express (FedEx), for example,

uses its BTV network, FXTV, to communicate with its managers across the

UK and Europe.

’We can’t expect an FXTV broadcast to reach our employees all at one

time, but it is there as a tool to aid management in communicating

effectively with their staff,’ says FedEx head of public relations Cliff

Morley.

Programmes up to an hour long are broadcast once every quarter and cover

management-led news, including the latest company figures, objectives

for the senior management team, training, sales and marketing and

personnel.

But it is not used solely for those purposes.

It also has the satellite technology in place to broadcast special

announcements at short notice - such as when the company launched a new

service in Moscow - and which Morley says could be used to brief staff

in a crisis situation.

The element of immediacy is also vital for the Ford Motor Company’s BTV

system. The Ford Communication Network (FCN) has been running since 1989

and this year it won the IVCA Gold Award for Regular Communication.

The network broadcasts to 51 plants, with 650 monitors in six different

countries. Its London-based production company, Uden Associates,

produces six to eight two-minute video news clips, with subtitles in six

different languages, that are shown on a 24-hour network. Between each

video news clip there is 15 minutes of teletext which covers local news

and events.

The video news clips change every week.

Brian Bennett, manager for internal communications for Europe, says

broadcasting 24 hours a day gives an opportunity for employees to catch

all video news clips and teletext information.

’We understand that our employees are not able to watch TV at all times

of the day so we give them an opportunity to see bits and pieces

throughout the week,’ says Bennett.

Ford also uses BTV to provide communications support in crucial

situations, such as when stories about Ford appear in the press.

’It is essential that we maintain credibility and integrity with our

staff and so we have to provide a balanced story. It’s not just company

propaganda - if it was, our employees wouldn’t listen to us.’

Ford also runs special programmes produced on areas such as new

products, motor shows and major events. There was even a programme

featuring country profiles from Australia to Columbia.

Barnaby Logan, senior producer for corporate at Uden Associates, says:

’They were ten-minute special reports on a country’s economy and culture

and how Ford fitted in with it. It is part of Ford’s globalisation

strategy.’

Other companies which use BTV as part of their ongoing strategy include

The Body Shop UK and The Body Shop International. London-based

independent production company Jacaranda produces programmes on a

regular basis and duplicates and distributes them internally.

The Body Shop UK produces BSTV once a week and covers regular employee

communication topics such as company news, staff training, new products

and sales and marketing and campaigns.

Director of Jacaranda, Gus Colquhoun, says the programming is not just

about employee communication. ’BTV allows Body Shop employees to gain

information about the company’s beliefs and how the company works.

’The programmes are geared to instruct community action,

environment-awareness and social awareness campaigns. Some programmes

may be about animal testing, while others encourage employees to

volunteer their time to dedicate to good causes and charity work,’ he

adds.

Staff are encouraged to watch the programmes in-store during lunch

breaks and internal surveys estimate that 89 per cent of the employees

watch each week. For outside the UK, a programme is produced in 19

different languages. It has a similar format and content, but Body Shop

World contains different elements for an international audience. This

may cover product launches in different markets. For example, Body Shop

sun care may feature in one hemisphere while, in another, programmes

will focus on preventing dry skin in winter.

The Body Shop’s system is distributed by video, but the live satellite

systems can add interactivity to the process - giving employees a chance

to participate.

Sainsbury’s, for example, has exploited the interactive potential

element of its BTV. Sainsbury’s Channel SMART (Sainsbury’s Management

And Retail Television) offers employee communication to 160,000

employees in 390 stores. Eighty per cent have interactive elements and

all the programmes are live from the ITN building in London.

The flagship programme, It’s the Business, is shown once a month and

hosted by chief executive Dino Adriano. Live phone-ins are hosted, which

allow employees to have their say, and give management valuable feedback

from the shop floor.

There are additional programmes for departments such as butchers and

bakers which have proved especially useful when the supermarket had to

brief its staff during the crisis period last year when the BSE problem

struck.

Other supermarkets are starting to follow suit. Asda and Somerfield have

their own BTV networks, while a spokesman for Tesco says it is looking

into the matter.

This kind of communication can be expensive - with programmes costing

between pounds 5,000 and pounds 25,000, or more if satellite linking is

used - but the results can be rewarding.

CTN’s Watson says that the system that Merrill Lynch had in place, for

example, paid for itself after that day when it managed its crisis

successfully.

Perhaps BATV will also pay for itself by contributing to the healing

process at the world’s favourite airline.

LIVE BY SATELLITE : CONQUERING THE CRITICAL TIME FACTOR

Crisis communications is not usually on the minds of companies when they

install BTV, but is an area which any company must be prepared for.

BTV via satellite provides the immediacy vital for crisis

communications.

Companies which have BTV satellite, such as Federal Express, Ford,

Sainsbury’s and Halifax all have provision for crisis communications,

although few of these networks have had to use it.

Sainsbury’s, however, found itself having to deal with two crises last

year - and it used BTV successfully in both.

After the BSE issue broke, chief executive Dino Adriano informed staff

and, most importantly, butchers about the situation and issues and

stressed that employees would be kept informed.

It also ran a specially produced report on health and safety issues

related to packaged meat , including footage of abattoirs, and ran it

across the SMART network. It held phone-ins for its staff to make sure

that all were reassured of how to proceed.

Last Christmas was not a particularly happy one for Sainsbury’s, either,

as its trading statement showed that profits had dipped and, as a

result, the share price would fall. David Sainsbury and Dino Adriano did

a live broadcast to tell employees the news before it hit the press.

Sainsbury’s management was able to overcome these crisis issues by

communicating quickly, effectively and honestly to employees.

Halifax plc also has its BTV in place to cover crisis issues. ’We have

the ability to use BTV in a crisis and put something together within

four hours. We tend to use it for major announcements,’ says Martin

Batt, business television controller, Halifax.

BTV for Halifax was useful for the announcement of the takeover of

Clerical Medical in March 1996 and the demutualisation of Halifax. Batt

feels strongly that in these situations, the employees should hear the

information first.

’The only situation when the employees didn’t hear first was the merger

with Leeds and that was only because it was leaked to the press and they

found out from a broadcast. There was a strong feeling from employees

that this should never happen again. We should be in control of events.’

Now that Halifax is a bank, BTV will play an even bigger role in major

announcements such as financial results.

’We follow the Stock Exchange rules where we must make an announcement

at 7.30am and we announce the same information to our employees at 8.45

am,’ says Batt.

INVESTING IN THE FUTURE: GIVING BANKS CREDIT FOR RAISING STAFF INTEREST

RATES

A growing area for business television is the banking sector. With

between 1500 and 2000 branches run by each UK high street bank, BTV is

one answer to a logistical and communications nightmare.

BTV has proved an important part of employee communication within the

banking sector. ’It’s going through major changes which need to be

explained to those people who aren’t expecting change,’ says Martin

Batt, business television controller, Halifax. ’It brings information to

help let them know what is going on.’

Halifax started its pounds 5 million internal BTV, known as HTV, in

August 1995 and it has been used to break news developments that affect

staff.

There is programming in sales and marketing, news and special

reports.

Production facilities are in-house and broadcasts reach 1,700 branches

weekly.

All branches are asked to watch on Wednesdays at 9am. It is a tradition

among building societies to open late because there is a low customer

demand at this time. Each branch has a video player so the programme can

be recorded for part-time staff.

Other programmes include question and answer sessions with CEO Mike

Blackburn.

Initial research suggested that employees were surprised that the CEO

wasn’t talking to his employees. But now the sessions are extremely

popular.

’We position the presenters as independent agents who ask the

questions,’ says Batt. ’The questions have become quite probing, tending

towards the Jeremy Paxman style of interview. They are firm and

penetrating and are much more effective at getting a good answer for the

audience.’

Programming is no longer than 15 minutes. ’It is important for us to

build up a regular pattern of TV viewing and to return to subjects later

on, to build up an understanding over a period,’ says Batt.

Between 75 and 96 per cent of staff think HTV is honest, professional

and has staff interests at heart. And employees value the information

they get from the television programmes as much as that which they get

from their line managers.

Other banks are starting to follow Halifax’s example. Barclays Consumer

Lending and Personal Loans Finance division is trialing BTV in 40 sites

with five programmes over a three-month period to communicate marketing

and sales information for the instant win Barclaycard joint promotion

with travel company Going Places.

’We have done extensive research on this area and for the first episode

it has been well-received,’ says head of business management, Consumer

Lending and Personal Loans Finance for Barclays, Tim Kiy. ’The first two

programmes will be pre-recorded and the other three will be live. We

will wait until the pilot runs its course.

Once the pilot programme has been broadcast, Kiy will examine whether

there is an initial honeymoon period, or whether an element of BTV

fatigue sets in. However, if successful, BTV may become a permanent

feature at Barclays.

WTN: GIVING COMPANYWIDE ISSUES WORLDWIDE COVERAGE

If there are companies which are looking to join the business television

bandwagon, there is an opportunity to try it for one-off events.

News agency Worldwide Television News (WTN) has been instrumental in

helping companies plan and execute external communication plans. It

offers the full package of a production company and satellite

transmission for both internal and external BTV.

’We do individual projects from AGMs and product launches, to investor

relations and linking financial analysts,’ says WTN’s business

development manager Neil Ormsby.

External BTV is used for external messages which need to reach the right

audience. ’It also offers the ability to reach any public, anywhere in

the world and at any time to provide, for example, product or financial

information about a company,’ says Ormsby.

For WTN’s clients, external BTV is providing a way to test the

water.

’These clients haven’t yet committed to an internal network and at the

moment are using it for external purposes,’ says Ormsby.

WTN was instrumental in communicating the announcement of Glaxo’s merger

with Wellcome. It also linked pharmaceuticals company Merck to medical

conferences around the world to announce new research.

External BTV is used mainly for special events and ad hoc projects and

can cost more than internal BTV, which can involve major capital

expenditure.

Once installed, the network can be used at little additional cost.

With external BTV there is flexibility in choosing when, where and to

whom the message should go. It can reach any person or any company in

the world.

Public relations agencies, which may not have internal BTV, may opt to

use external BTV. Burson-Marsteller uses its BTV network outside the

company for added benefit to its clients. It allows for pan-European

briefings or press announcements or press tours. ’They have a

competitive advantage over other PR firms because they can offer this to

the clients,’ says CTN’s managing director Steven Watson.

But not all external BTV is as successful. Sainsbury’s has investigated

’check-out TV’, a concept trialed in the US. But store psychology in the

retail sector suggests television is not the best way to get people to

buy more products. Watson suggests it may be used on an ad-hoc basis or

for special events.

The Body Shop is working on external communications for the global

market to promote awareness of such issues as animal testing and

community trade.

Possible ideas have included showing videos in-store or making them

available for purchase.