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1998 Innovation Optimas Award Profile The Pillsbury Co.

February 1, 1998
The most important information a company can have is the kind it rarely gets: frank, unreserved, this-is-how-it-is feedback from employees. No matter how many rallying speeches managers give about how their doors are always open, about how they want employees to challenge them, that sliver of fear remains. Where's the line between offering constructive criticism and giving offense? How can anyone be sure today's pointed conversation won't influence tomorrow's performance review?

Minneapolis-based The Pillsbury Company has the answer. A unique employee-feedback tool, a hot line called InTouch, allows anyone to phone any time and talk about anything with the comfort of anonymity and the assurance that their issues will be addressed. The technology used isn't particularly innovative -- but the way in which the company uses it is.

"Getting this feedback wasn't fun the first time out, and sometimes it still isn't," says Lou de Ocejo, senior vice president of HR and corporate affairs. "But the system does just what we need it to do."

Pillsbury finds a recipe for frank feedback.
The early '90s were a confusing time at Pillsbury. Between 1990 and 1993, the food company experienced a major shakeup of senior management, had been acquired by British-based conglomerate Grand Metropolitan PLC, started growing globally and had massively restructured, tossing away functional silos.

The new management team, including de Ocejo, realized a new communications plan was in order. It introduced an employee newspaper and CEO luncheons with employees -- anything to encourage employee interaction with top management. "It's easy for executives to talk a lot and assume they're having conversations," says de Ocejo. "And it's hard as hell to get employees to risk telling you what's really going on."

It's a nationwide problem, according to Market Facts' TeleNation, a Chicago-based independent research organization. In a 1997 poll of 638 employees, more than 90 percent said they had good ideas on how their companies could run more successfully. Yet more than 50 percent said a lack of management interest and lack of a good means for sharing those ideas prevented them from communicating their ideas to management.

While de Ocejo was looking for a better communication tool for his company, Peter Lilienthal was looking for clients for his sole product, InTouch. Lilienthal had started his Minneapolis company, Management Communications Systems Inc., thinking InTouch would be an easy sell. In his previous career as a corporate officer at several large corporations, Lilienthal had been reluctant to criticize his superiors. "I wondered how everyone else must feel," he said. "That gave me an idea on how to improve communications." That idea was the anonymous hot line InTouch, a toll-free, third-party voicemail messaging system through which employees could send comments straight to the top without fear of reprisal.

InTouch had one catch -- Lilienthal couldn't give it away, literally. At a Society for Human Resource Management convention, Lilienthal raffled off 10 free one-year subscriptions to his service. The winners all turned him down. "A lot of HR people are nervous about this," says Lilienthal. "They don't know what they're going to [hear] from employees. But if you're really interested in improving communications, you should want to know."

Lilienthal only had one client when he met de Ocejo at a dinner party in 1993. Over the evening's courses, de Ocejo explained Pillsbury's communications problem to Lilienthal, and Lilienthal explained to de Ocejo how InTouch could work at the company. Employees from all locations could dial a number around the clock and leave a message of up to four minutes. The outside service would transcribe the messages -- no worries about the boss recognizing a voice or handwriting -- and send them to Pillsbury executives. The system would only cost $3 per employee a year; a bargain, de Ocejo says, for unreserved comments.

De Ocejo decided Pillsbury should become Lilienthal's second client. He pitched it to the senior management team, who, he says, "gave me a quizzical look, but approved it." The next hurdle was, of course, getting employees to use it.

Seasoning to taste: Pillsbury adapts the system.

Executives bombarded employees with information about InTouch. The workforce received stickers, business cards and magnets, inviting workers to "direct your opinions straight to Pillsbury management." Employees, says de Ocejo, were cynical. But they also, apparently, were desperate for a safe means of voicing themselves. The calls came pouring in. Employees left messages about faulty work systems, ineffective supervisors and new product ideas.

Today, Karen Gustafson, director of employee communications, says InTouch is key to ensuring "senior managers [aren't] isolated from the rest of the company. It has strengthened our commitment to two-way communication."

In the four years since introducing InTouch, de Ocejo's main concern has been to tailor it to be useful to the company and employees, rather than seeing it degenerate into a depository for employees' gripes. When employees call, a recorded voice suggests they consider whether they want to remain anonymous, whether they'd like to receive a personal phone call and even if they want to address their message to a specific person. Each employee also receives an instruction sheet for InTouch, with questions such as "Is this a broad issue or should I be talking to my local manager?"

De Ocejo also constantly reminds the workforce that InTouch isn't a voting machine. Just because a large number of employees ask for a certain course of action doesn't mean they will get it.

What they will get is the knowledge that de Ocejo, CEO Paul Walsh and the company's general counsel review every transcript. The three receive weekly packets of transcripts -- Walsh even has his faxed to him when he's on business trips.

If an employee leaves a name and requests contact (27 percent of callers do), someone will follow up, generally the line manager in whatever area the call concerns. If the caller simply leaves a complaint or a suggestion, the executives decide whether it's valid and deserves more research. If a call concerns a specific area or plant -- the hot line suggests employees name the area they're calling from -- the executives will send the transcript on to the head of that area also. The general counsel and HR thoroughly vet questions or issues of a legal nature, although, because Pillsbury also has a whistle-blower hot line, these are few and far between.

De Ocejo sends out management letters answering questions and reporting changes made as a result of the hot line. Managers post responses on bulletin boards. Gustafson says the company never posts an actual letter, only a paraphrase, to ensure employees can't be identified through particular word choice or vernacular.

Pillsbury Today, the company's newsletter, prints monthly questions and answers elicited by InTouch. When an employee suggested returning the Pillsbury Doughboy as a Macy's Thanksgiving Day parade float, for example, the director for advertising was able to respond that he would consider the idea. When a caller left a compliment for a computer-assistance person, the newsletter printed it, giving the man some public recognition. An employee who asked for an ATM on the 31st floor of headquarters received a response from the facilities administrator about why the machine wouldn't generate enough business to justify its cost.

Still, says de Ocejo, not everyone's satisfied all the time. "I spend a lot of time and effort digging deep and finding [answers]. But I never promised I was going to give out lollipops."

Being "InTouch" makes a difference.
Some big changes have been made as a result of the hot line. The more than 2,300 messages recorded since 1993 have prodded about 200 product and cost-savings ideas, including recommendations for new pizza toppings and recycling of surplus plant paper into packaging material. Pillsbury has streamlined the business-expense reimbursement system and speeded up the process for calculating pension benefits. And, a broadcast voicemail now shoots automatically into everyone's voicemail in the case of a plant closing due to weather, courtesy of a caller's suggestion.

These big changes, however, aren't the crux of InTouch. De Ocejo says 99 percent of calls are about more mundane local matters that just need clearing up -- the sales force isn't getting price lists on time, or a new delivery route isn't working. Thirty-six percent of calls concern benefits, followed by 18 percent concerning product and cost-savings ideas and 18 percent concerning organization and morale issues. Workplace and environment suggestions make up 7 percent of calls, as do policy and procedure suggestions. The remaining 4 percent is miscellaneous.

Lilienthal attributes InTouch's success to its comfort zone of anonymity and to its convenience. "Most employee suggestion systems aren't necessarily easy to use. This [hot line] is. You don't even need to figure out whom to go to -- the message goes right to the top."

As important as convenience is to Pillsbury's approach, Lilienthal says the company's follow-through efforts are what makes it really work.

Of course, de Ocejo admits the hot line will never be preferable to one-on-one frank conversation. But the hope is that employees will transfer the skill of talking candidly to in-person conversations and that managers will become better listeners and problem solvers for their workers.

As for employees, they're grateful. "It's things like this that make me work twice as hard ... that re-motivate me," one caller said.

Someday, Corporate America may reach that nether world in which all employees can say anything to all managers. Until then, Pillsbury's hot line -- and HR's involvement with it -- is a major ingredient to the company's success.

Workforce, February 1998, Vol. 77, No. 2, pp. 56-59.