PORTLAND, Ore. -- Communicating with employees is a key ingredient in keeping a workforce motivated, according to a pair of speakers at the ninth annual Executive Forum here.
Jim Donald, president of Starbucks North America and the former chairman and chief executive officer of Pathmark Stores, Carteret, N.J., said keeping associates in the loop and sharing his philosophies with them was part of the reason Pathmark was able to make its way through bankruptcy in the late 1990s. It's an approach that's also serving him well at Starbucks, he added.
"At Pathmark, there was no way to turn that ship around without explaining things to associates," Donald recalled. "So I began communicating with them weekly through videos." He also recorded a message every day that employees could phone in to hear, "and I've done the same at Starbucks so we don't lose touch with the people in the business."
When he came to Starbucks last year, Donald said he spent two months visiting stores and talking with employees, "asking what I could do so I wouldn't let them down, and I told management we could develop loyalty with the partners [employees] by encouraging them to let us know what they cared about and listening to their concerns."
At Pathmark, he said he let associates know it was okay to stick their necks out and take risks "because you've got to create an environment with the freedom to fail."
Donald cited several instances in which employees doubted the wisdom of his suggestions but went ahead anyway, including encouraging a seafood manager to order 300 pounds of rockfish for a promotion; challenging his staff to outsell Pathmark's three major competitors combined on a ground chicken promotion; and encouraging workers at one store's bakery to boost sales during the week after Thanksgiving, traditionally one of the worst weeks for bakery sales during the year.
The company succeeded in all three instances, and that was a reason to celebrate, Donald said. "Take time to celebrate your success, and the success of others," he declared.
Taking a page from Sam Walton, who hired Donald at Wal-Mart in the early 1990s, Donald said executives "should never be bigger than the front-line selling force."
John McGinty, vice president, customer development group, Nestle Purina PetCare, also stressed the importance of communication in his presentation, which dealt with corporate mergers.
"Any change in ownership creates stress and turmoil within an organization," he explained. "So communication is extremely critical," even if the communication is intended to convey negative information.
"Keep the concerns of employees first, and keep your communications frequent and honest, providing the best information available at any given time," McGinty said, suggesting the use of written updates, weekly voice mails, video conferences and face-to-face communications to keep employees well informed.
In another talk, J. Walker Smith, president of Yankelovich Partners, Norwalk, Conn., said companies need to keep current on changing consumer attitudes so they can craft their messages effectively.
Based on his company's research, Smith said aging baby boomers, who are setting the agenda for the marketplace, "are put off by super-abundance. They're looking for quality, not quantity. They're looking for more authenticity and integrity in their relationships -- a return to traditional standards and family values -- and they want guidance to help them make buying decisions.
"It's not about comfort food, but food as a tool to re-connect with other people. There's a quest for connectedness, and putting the family first."
