What we have here is a failure to communicate
Novell CEO Jack Messman openly derides the names of some very innovative products that his company has brought to market. The reason? Nobody can understand what they do, he says.
"DirXML? That may make sense to an engineer, but no one else," he laments. That's why he recently hired a new chief of marketing. His mission: to give the products the company brings to market more meaningful names.
Messman is a bit of a rarity in Corporate America. He buys suits off the rack (nice ones from Brooks Brothers) and wears a plastic, digital watch because he concedes that his expensive ones from Switzerland have hands and hour markers that are too small for him to read clearly. He's also bold enough to say "balderdash" to some of the language that businesses use.
I've ranted on this topic before, but progress on reducing Corporatespeak remains scattershot. Actually, compared to other industries, IT isn't doing so badly. Consider the following from the 2004 Altria Group Annual Report. (That's the company that owns both Philip Morris USA and Kraft Foods.) The letter to stockholders from chairman and CEO Louis Camilleri contains several gems, including this passage:
"Over the past several years, we have steadfastly stuck to our strategic plan to secure organic growth, supported by effective marketing and innovation, and complemented by meaningful acquisitions. Marketing expenditures have been restored to competitive levels at our operating companies, price gaps have been addressed with rigor, and the quality of products and programs has been enhanced...And very importantly, societal alignment initiatives are placing our operating companies at the forefront of the tobacco and food industries."
Where to begin? How about with "meaningful acquisitions." I guess those are different from "throwaway deals." Also, it's refreshing to know that price gaps have been "addressed with rigor." That's not to say that they were fixed, improved or even reduced. But give Altria credit for trying, at least.
What about closer to home? Well, contrast the style of Camilleri to that of IBM chairman and CEO Sam Palmisano. In his letter to shareholders this year, the IBM chief explains something that a lot of people have wondered about: IBM's decision to get out of PCs. In plain English, Palmisano explains why IBM did what it did:
"...Over the past several years, while we increased our presence in software, consulting and infrastructure services, we exited or reduced our presence in commoditizing businesses like hard-disk drives, memory chips and networking hardware. And most notably, this past December, we announced our agreement for Lenovo, China's computer leader, to acquire IBM's Personal Computing Division. These kinds of decisions are hard for many companies...because it means parting with business models and technologies that were once their crown jewels."
After reading Palmisano's explanation of the company's deal with Lenovo, I looked to see how HP explained the firing of former CEO Carly Fiorina. In a letter to shareholders, then-acting CEO Robert Wayman chose not to address why Fiorina was dumped by the board, but he summed up the year thusly: "In fiscal 2004, HP's focus progressed from consolidation, integration and cost-cutting to accelerating profitable growth, driving leverage across HP's product portfolio and extending leadership into new categories. In many areas, we performed well, but in some areas, we were inconsistent or fell short of expectations."
Wayman gets points for straightforwardness, but not for openness. Why, exactly, did HP, which grew its top line nearly 10 percent last year and saw profits jump, dump Fiorina, and how can it justify hiring new CEO Mark Hurd for so much?
Another company with some explaining to do is SCO. Although it continues to make headlines by taking on IBM, Novell and others in court, SCO's sales continue to shrink. Its Unix business alone fell 21 percent last year to just $11.4 million. Despite a shrinking revenue base, difficulties maintaining its trading status on Nasdaq and workforce reductions, SCO remains the plucky upstart: "We remain steadfastly focused on winning in both the courtroom and in the marketplace," said CEO Darl McBride in the company's most recent earnings release.
For real simplicity, it's hard to beat Bob Huang, president and CEO of Synnex. In his letter to shareholders this year, Huang proudly notes the company's many achievements, including record profitability: "I am excited about the opportunities that lie ahead for Synnex and look forward to sharing in our growth and success with you."
Polite, and to the point. What more could you ask for?