Matt Eventoff

News Flash –  Richard “Rick” Wagoner resigned as CEO of General Motors yesterday at the behest of President Obama.  Was it the right thing to do? Was it fair? Was he a scapegoat? Why has no one else receiving bailout money been removed?  Why notbankers?

I can’t, and won’t attempt to, answer any of these questions. I write about communications and messaging.

For anyone that still believes that “soft skills” like communications and messaging are not as important as “harder” skills, look no further than Mr. Wagoner and his initial bailout testimony in November of 2008. 

Flashback to November, 2008 — the CEO’s of the Big 3 came to Washington, D.C., hat in hand, requesting a $25 billion dollar bailout package, and prior to testifying, Congressional leadership was planning on giving it to them.  Of course, once the CEO’s testified, everything quickly changed, and not for the better.  Any goodwill the industry had before the testimony quickly disappeared, as did the painless bailout package. Why?

Communications skills.

The lessons from the Big 3 debacle in November, and Mr. Wagoner’s removal 5 months later:

Lesson #1 -  Fly Commercial  – In all seriousness, everything you do sends a message. I apologize for being repetitive, but everything you do sends a message. I am still amazed that as all 3 Chairmen came to Washington, hat in hand, on a private corporate jets.  Let me put this in context for a small business owner — do you think it would be a good idea, if you were nearly bankrupt, to drive over to your neighborhood bank in a Rolls Royce to plead for a loan? It is astounding that not one of the three Chairmen thought that maybe, just maybe, taking a commercial flight might be a better move. Scary.

Fast forward a few hours into the testimony when the CEO’s were asked whether or not they would take reduced compensation, and those requests were subsequently brushed aside. (Two weeks later when the CEOs had to testify again they agreed to the drastically lower salaries — one can only speculate how things might have gone had they prepared for the question prior to the original hearing)

As someone much wiser than me said,” There are three things you can’t take back – words, an opportunity and time.” Very wise. (I don’t know who to attribute this quote to – if anyone does, please let me know).

Lesson #2 – Know your subject  – If you are presenting on a subject, any subject, you MUST be able to answer basic questions. That means at the minimum a practice session with your staff where you are asked questions that are likely to come up.

Senators repeatedly asked the witnesses a very basic question. Where did the $25 billion dollar figure come from? No real answers. This happened time and again with basic questions. The Senate Democrats are on record as being fairly supportive of a bailout concept. It is unbelievable that the executives present could not answer basic questions justifying their request. One day of preparation would have at least allowed answering basic questions. In my opinion, it was at this juncture that the fate of the bailout package, and possibly Mr. Wagoner’s future as GM CEO, was sealed.

Lesson #3 – If you say a lot of different things, you say nothing  – If you are making a request, you must have a central message. There was no central message at this hearing, other than “we need money or people will lose their jobs.” Even that might have been able to be transformed into a message if the very basic question – If we give you the money, to what (exact) degree does this ensure against layoffs?

This question was never answered, and to my knowledge, still hasn’t been.  Congresswoman Carolyn McCarthy certainly “gets it” and said so much when the executives appeared before her committee two weeks later.  When the Big 3 still could not clearly articulate what the bailout meant financially, she said, “You have to learn how to talk to the public.” 

Kudos to Congresswoman McCarthy – Communications 101 for a leader.

Lesson #4 – Tone and Body Language Matter – More than a few reports following that testimony described the tone as arrogant, and I certainly saw signs of discomfort and frustration during the testimony. 

What makes this all the more surprising are the positive reports from internal managers and folks who have worked for Mr. Wagoner, who have described him as a team player, humble and an all around decent man.  Up until the end of his tenure, he was described as easy going and personable – the complete opposite of the public persona he adopted when testifying.

Lesson #5 – Practice. Practice. Practice. – I believe that this could have and would have cured a lot of the issues with the initial testimony.  It was evident that there was not enough preparation going in, as the lack of clear answers. When you are on an international stage, everything you say and do, whether verbal or non verbal, sends a message.

Directly reading testimony, especially when asking for something, is not a good idea. Only two things make it worse — not having written the testimony yourself, and not practicing

Were poor communications skills and botched testimony the only reason that Mr. Wagoner is no longer CEO of GM? Of course not, but the disasterous performance in mid-November certainly played a role. Had he managed to endear himself to the public, or at least been viewed as a sympathetic figure,  odds are the Administration would not have chosen to make an example of him. 

It is often said that 40 is the new 30. In that same vein, I would propose that in 2009 going forward,  “soft skills” are  the new “hard skills.”

President Obama’s Press Conference has just concluded and a lot of questions have been asked and answered.  There are a number of public speaking and communications lessons that can be learned from watching both the President and those questioning him.

Among the lessons is one that every corporate, non profit and political leader can, and should, implement immediately.

The President is a talented communicator.  His appearance, choice of attire, and posture reflected his confidence, and he certainly looked “Presidential,”  as he usually does.  There were tough questions and by and large he remained not only composed but in command — there was no questioning his presence throughout the event.  Only one thing stood out more than the President’s presence, and that is, uhhh….

It stood out from the first question, and continued throughout the press conference.  During one 10 minute stretch I counted the President use ”uhhh” 47 times.  Nearly 5 “uhhh’s” a minute. I raised the issue of verbal “noise” or ”filler” - the use of uhhh, ahhh, ummm, etc., and the damage that does to one’s ability to deliver a message. 

Unfortunately, this occurs every minute of every day in every meeting room, conference room, board room, press conference and trial, and the damage it does to the ability to get a point across or accomplish what you are trying to accomplish is staggering.  This week alone I sat through both legislative testimony and a major presentation where every other word seemed to be “filler” and what I witnessed was no surprise.  Eyes were focused on blackberries, cell phones, the floor and in one case, the back of eyelids — everywhere but where the presenter wanted the focus. 

Why does this matter?

If you are requesting funding from a VC for $15 million do you want the conversation that follows when you leave the room to be about your presentation or your repeated use of “ahhh?”  If you need to focus your employees on the challenges that must be addressed immediately, do you want them to listen?  If you are testifying before a Legislative body, or are a Legislator speaking on the floor of a legislative body, do you want to get your point across? 

Of course you do, and verbal filler prevents that from occurring. Unfortunately, in most instances you won’t know why until it is to late, if you find out at all, and you rarely get a second chance.  So how can you prevent it?

The President is a perfect example.  In nearly EVERY instance, the”uhhh” came as he was beginning a sentence or thought.  This was the President’s way of gathering his thoughts prior to speaking, and the “uhhh” served as a placeholder until he was ready to respond.  If instead of beginning to speak he would have acknowledged the question, either verbally or through eye contact, and then taken a SILENT few seconds prior to responding (a brief pause), the difference in his delivery would have been dramatic. 

In my experience, everyone, myself included, would benefit dramatically from pausing more and taking a second or two to gather thoughts silently.  Caroline Kennedy had a week of bad press due to her constant use of “like, you know” in an interview, and that may have cost her a Senate seat. 

If you present, you owe it to your audience and yourself to pause more.  A message is a terrible thing to waste.

Wow.  Very rarely do you see a media personality who appears on television a minimum of 5 hours a week look like a proverbial “deer in highlights.” That was the case when Jim Cramer appeared on Jon Stewart’s The Daily Show, following what has been described as one of the best cable TV feuds.   Thanks to the folks over at Comedy Central’s Indecision Forever, the entire “interview” is available, including the third that didn’t make it onto television.

The contents of this interview have been debated, blogged and argued nonstop for two days now.  Full disclosure: I have pointed out Jim Cramer’s inconsistencies in the past, not necessarily in what he says, but in how he communicates differently to different audiences.  Jim is an “over-the-top” personality on his Mad Money program, but significantly more contrite and reserved in other situations (when discussing his friendship with Eliot Spitzer or when appearing on The Daily Show).

There are a number of communications lessons to learn from this last debate:

1.  Be Consistent – Everything you say and do sends a message, and it all sends a message about YOU.  This is twice as important when you are in the public eye.  The American public can deal with and forgive quite a bit, but two things the public is slow to forgive are hypocrisy and/or inconsistency (see A-Rod, Eliot Spitzer).

In this case, Cramer sees his role as a respected financial commentator when appearing on his program, but as just another entertainer when he appeared on The Daily Show.  That’s an impossible tightrope when you are talking about something as serious to people as finance, especially their own.  (If you think this isn’t the case, watch the last two minutes of this interview to see a lot of what may have driven this interview)

2. Have a Message…and Stick to It! - All over the map is the only way to describe Cramer’s responses.  CNBC may, or may not have some responsibility, I may have some responsibility, I may not have some responsibility, I am trying to do the same thing you are doing, and the list went on and on.  Painful to watch.  Couple that with the fact that every time Cramer’s message changed, Stewart seemed to have a clip contradicting what Cramer just said, and what is left is a disaster. 

In politics, the phrase is message discipline — see Obama Campaign - having a message and sticking to it, no matter the line of questioning.  Forget discipline, Cramer did not have a consistent message, and chances are just about ANY message would have resonated better than having none at all.  Cramer actually did a decent job of trying to re-frame the debate, but was completely hampered by the lack of message.

3. Practice and Prepare – Simply No Substitute - I have no idea how much or how little Cramer prepared for this interview.  What I do know is that this feud had been running all week, had been escalating daily, there was plenty of past “tape” (television footage) of Jon Stewart, as well as past coverage of Jon Stewart taking a similar, more serious tone, with guests in the past.

Simply put, Jim Cramer certainly could have, and should have, been prepared for Stewart to take this tact.  Solid media training, or more importantly, debate preparation, would have put him in a much better position.  There was no question or statement that Stewart made that I would describe as unexpected (the tone may have surprised some, but the questions or statements would not have).  Whether engaging in a debate, conducting an interview, or making a presentation, there is simply no substitute for practice and preparation.

It is never a good week when one of the most highly regarded investors of all time, Warren Buffett, declares that the economy “has fallen off a cliff”  after previously stating that the financial crisis is an “economic Pearl Harbor.”

Secretary Geithner has had his hands full since he took office, and has not established himself as a skillful communicator or messenger up to this point  He was lampooned on Saturday Night Live this past weekend, never a good thing for credibility, and was heavily criticized after announcing Treasury’s new plan a month ago, based both on his delivery and the lack of specifics to the plan.

Last night, the much maligned U.S. Treasury Secretary appeared on The Charlie Rose Show to discuss the economy, what has been done, and what will be done.  Needless to say, we are currently in some of the most frightening economic times ever.  People are scared, and are looking to Washington for reassurance. This was an opportunity for Secretary Geithner to talk directly to the public, in more of a conversation and less of a presentation and quell a bit of the panic and fear.

Unfortunately, Secretary Geithner did not do that, and I believe a large part of that has to do with his communications skills.   Fortunately, there are communications lessons that every leader, whether in politics, business or any other field, can learn from watching the Secretary.

1.  Always Have A Central Message — One of the main reasons that the Secretary has failed to effectively connect with the public is his jumbled and somewhat incoherent message. What does any of this mean to the average person 6  months from now? A year from now?  How does anything being done affect the average person?

The public has made it very clear that the time has past for explaining why the  economy is in the state that it is in, what the public wants to hear is an understandable plan explaining how and when the economy will improve.  Dr. Jeffrey Feldman has written a great article on framing this issue, as well as the importance of language and metaphors when framing this issue.

2. No matter the medium, it is important to be aware of your own voice Secretary Geithner has a few things working against him: 1) He speaks in a relatively flat monotone; 2) He speaks at a lower pitch, making it more difficult to hear him; 3) He speaks very, very rapidly, and then tends to trail off, and then get right back to speaking rapidly, making it very difficult to follow

3. Be aware of verbal ”noise” – “umms”, “ahhhs”, and “uhhh’s” all take away from the ability to deliver a message.  More pausing, more focused points, and more practice would have improved this tremendously.

4. Language Matters - the Secretary used very descriptive, “charged” words, such as dramatic, catastrophe, profound, to describe the “deep mess,” “we did some very important powerful things” - the issue is that he deadpanned these words — no expression at all. 

5. Expression Matters – When using words like these it is important that a) the fit the occasion and b) you allow enough time for the words, and the meaning, to sink in.  Flowing right from one to another to a different thought sends mixed messages.

6. Body Language Matters – the Secretary seemed to be hunched a bit forward the entire time, and his lack of expressiveness, especially compared to Charlie Rose, was very noticeable.  There was very little movement

7. Body Language Matters, Pt. II – Be aware of where body positioning AND body language — Secretary Geithner spent the entire hour talking with is chin lowered. This caused two problems: 1) It was harder to follow what he was saying as his voice was slightly muffled and 2) It put his forehead at the center of the screen, making it appear that he was not making eye contact, and putting the focus on his forehead.

While each of these issues independently would be a challenge, all of them together make it very difficult for the Secretary to connect with his audience and convey his message effectively.

The good news for Secretary Geithner is that, with training and practice, I believe he can still resurrect himself as a strong communicator.  The bad news is that every day more economic bad news comes in, his window of opportunity to become an effective messenger closes a little more.

This morning brought the announcement that AIG (American International Group), already the largest recipient of bailout (TARP) funding, set to receive another $30 billion dollars of Federal funding.  This comes on the heels of an announcement earlier this morning that AIG announced a loss of over $61,000,000,000 (billion!!) dollars this past quarter, the largest quarterly loss ever by a corporate entity. 

Why?

The answer given is the same one that was given when AIG was given $150 billion in taxpayer funding; You can read the answer here (the U.S. Treasury Press Release – a bit long) or at any one of the thousands of press accounts this morning — AIG is too big to fail, and the results of an AIG failure on the capital markets would be catastrophic. 

The same message delivered in September, along with $150 billion of your money. Groundhog Day.

What does this have to do with messaging?

Based on the market’s current reaction to “Bailout, Pt.???”, down to its lowest levels in twelve years, everything!

A lot has transpired in the world of AIG between September and today — a new CEO, a lot of government intervention, and a minor scandal.  Cur

Who can forget the reports of AIG executives using bailout funding for a spa trip at the St. Regis Monarch Beach Resort. (Or the answer from AIG — It wasn’t what it seemed – remember, everything you do sends a message!)

That wasn’t it. 

There was the AIG executive, Joseph Cassano, who is largely blamed for much of AIG’s malaise, who was slated to be paid $1,000,000 (million) dollars A MONTH  as a consultant until Congressman Waxman brought this little tidbit to the public’s attention and the contract was immediately voided by AIG (what message does it send that it took a Congressional Chairman to point out to AIG that paying the person who is largely blamed for your downfall $1 million dollars a month as a consultant probably doesn’t send a positive message, especially when you are looking for a bailout!)

Here are the statements today from both AIG and the United States Treasury and Federal Reserve.

What’s missing?

Simple — a message!

The message that “AIG is simply too important to fail” certainly sends a message. It sends a message to anyone who has lost a job, saw retirement slip away, or watched a home fall into foreclosure. 

It sends a message to anyone who has been furloughed, any retailer who has been forced to close his or her doors, and any small business that simply can’t access credit.

CEO Edward Liddy’s refusal to rule out the need for another bailout in the future  on CNBC earlier this morning sends a message as well.

My guess is these are not the messages  that either the Treasury or AIG wants to send.

I am not disputing the facts behind the latest bailout – I personally believe that AIG is probably too important to the US economy to allow it to fail.  My dispute is with the messaging, and how it is being handled.

What affect does AIG have on the life of the average person?

What would a collapse of AIG mean to the average person?

Does this new package guarantee that a collapse will not occur?

What safeguards are in place to ensure that there are no more partying on the taxpayers dime? 

Why has this concept not been “sold” to the American public at all?

These are all questions that should have been addressed this morning in either press announcement, and more importantly in a prime time address. 

The message being sent is that this is all too complex for the average American to understand — not a great message to send when you are spending the average American’s money. 

When crafting a message, always remember the audience and the needs of the audience.  Always.