Transfer Your Communication Skills to CYBER SPACE.

In the early 1990s I had the opportunity to observe closely a CEO at a major energy utility establish a strategic communication initiative as one of about a dozen over-riding goals driving his corporation's business strategy at that time. Each of the 12 initiatives had a project manager and work team from middle management, along with executive sponsors, too. The CEO assigned the leadership of the corporate-wide communication effort to a former labor union activist-turned-manager and a regional field operations director. Advertising and corporate communication representatives were given team membership, but not control of the strategic planning effort.

If a mature, 100-year-old organization with low risks and steady profits could take this off-beat approach almost a decade ago, what is likely to be the approach to organizational communication by today's cyberspace-based e-commerce leaders? Do they even bother with formal communication approaches? Can Internet-based business afford the time, effort and budget of traditional corporate communication and advertising functions?

As a former organizational communication manager whose career spanned nearly three decades, most of which were pre-Internet and intranet, I have concluded that the globalization of business is profoundly changing organizations' need for traditional communicators and functional departments. In a recent issue of this publication, I laid out a brief overview of what the so-called "third industrial revolution" means for communication as a distinct function (Communication World, August/September 1999).

While e-commerce companies are betting heavily on the Internet to carry on their business - be that wholesale or retail - they are not necessarily looking at communication as a function or strategic business tool. They "do it," rather than think or strategize about it. In a sense, e-commerce for the most part is communication. It is a world of rapid technological change, stiff competition and thin margins. This is a business environment that is not conducive to the normal contemplation and detachment of organizational communication. "Perspective" is often unimportant. Speed is everything.

Nevertheless, although it appears on the surface to be an oxymoron, e-commerce is still basically a face-to-face business. In Silicon Valley, being in the right meetings is more important than surfing the right web sites. What the e-commerce insiders call "physical community" is still important for both commerce and communication.

"Each of our work groups has weekly meetings," says Chris King, the CEO of a 50-employee e-commerce utility that is less than a year old. "I have them with my immediate staff and then my reports have them with their departments. And we have a monthly barbecue in which I give an overview of what is going on in the company."

In the traditional business press, Forbes magazine for the past two years has highlighted what it dubs "The E-Gang," a dozen or so of the movers and shakers among Internet commerce companies. This year's cyberspace dozen includes an Internet communication professional, Pamela Alexander, 44, whose successful high-tech communication firm in late 1998 was acquired by Ogilvy to form Alexander Ogilvy as a worldwide firm specializing in Internet clients. In the Forbes profile, Alexander, who started her firm in Atlanta and was an early user of e-mail and voice mail to reach across country to fledgling Silicon Valley clients, makes the point that the emphasis on "virtuality" among the e-commerce firms puts a premium on "personal contact and hand-holding."

A generational and technical disconnect between traditional communicators and the Internet crowd has to be recognized and dealt with. Practitioners who straddle both camps see more merging of the two, and they sense a grudging mutual respect. There is also an acute scarcity of qualified people to fill the technical, marketing or communication slots in the burgeoning number of Internet-based firms and mainstream companies trying to develop an Internet commercial presence.

"There is such a high demand for people to do communication and PR in the technology space that there aren't enough experienced people to go around," says Holland Carney, executive vice president in charge of Alexander Ogilvy's San Francisco - based West Coast operations. "It is a great time for experienced people from other industries to take their transferable communication skills and learn to apply them to a new industry."

According to Larry Pryor, online journalism director at the University of Southern California Annenberg School of Communication, "E-commerce organizations are fundamentally different, and the way they operate internally is fundamentally different. It is much less structured. Communication is mostly by e-mail, even among people who work in the same office. A lot of the information that employees obtain during the work day or business week is off of the Internet (not from 'power lunches' or hanging out in 'good ol' boy networks').

"We were astounded at the (Los Angeles) Times when we started our web site. We thought our customers were going to be in homes, but when we began to track it, we found that about 80 percent of the traffic came from people in offices. It started on the East Coast at 6 a.m. West Coast time and would drive to a peak at noon West Coast, and then by 6 p.m. West Coast it was down to about 20 percent of the peak.

"People are using their computers at work to get a lot of information."

What this tells the savvy internal communication practitioners is that a company's news and messages have to be integrated with other net-based information that employees go after regularly with their office PCs. It also means that the proverbial organizational "grapevines" are most likely alive and well but transformed into an electronic medium rather than relying on word-of-mouth.

Often the start-up Internet firms are peopled by graduates of the nation's prestigious colleges who have tried traditional organizations but given up the big pay and bonuses for the potential freedom and rewards of starting a whole new company. How can you communicate in traditional ways with standard messages to a group that for the most part is under 30 and fiercely focused on building a business no matter what it takes to get the job done? Letters, speeches and newsletters from the senior management don't carry much weight or interest. Ditto recognition plaques and awards!

At one e-commerce firm spawned with the help of Pasadena's famed Idealab!, the early-40s, Stanford-educated CEO admits that in his first nine months from start-up he hasn't given internal communication for his growing organization much thought. He is in the process of hiring a full-time marketing communication specialist and contracting with an outside public relations firm, but for employee communication he thinks now that, when he gets around to it, that job should go to a full-time, internal specialist.

With about 50 full-time and part-time employees now and targets of 50,000 customers and U.S. $5 million/month in revenue by the end of its first year, Chris King, CEO of Utility.com, an Albany, Calif., based national Internet electricity and gas provider, says that if his firm ever gets really big, with thousands of employees, "then, of course, we would probably outsource our internal communication function."

USC's Pryor, a former LA Times reporter who helped pioneer the paper's first web site within a traditional media empire, noted that it is an interesting time for organizational communication because nothing is as it was. Even the most isolated parts of the organization - top management - that used to rely on good ol' boy networks for their views of the world have been invaded by cyberspace.

"The Internet environment is becoming everything," Pryor says. "It isn't just the World Wide Web; it is primarily e-mail and list-serves. Managers of a particular function in a particular industry can get on lists that involve their peers all around the world. They can now communicate and share information daily if they want.

"That's another thing that is different in the Internet world. People are much more willing to share their problems and discuss things in common. There is no common book on this stuff. There is no 'right way' to do it. It is much more of a sharing among peers than in past business relationships.

"You may end up striking up a close relationship with someone in Switzerland or Hong Kong, and only the Internet can allow you to do that."

It is worth noting that these inroads leading through cyberspace are affecting communication in all organizations - not just among the e-commerce firms - but it is particularly pronounced there because the very existence of the business enterprise owes its success to the speed and pervasiveness of the worldwide linkage.

MBA schools and traditional employers are finding more and more that they have to walk and talk e-commerce. A recent cover story of Fortune magazine was devoted to this phenomenon, noting that it barely existed four years ago.

One aspect of the magazine's review noted that the current crop of e-commerce MBAs view failure entirely differently from past generations. The fact that the majority of the e-commerce start-ups don't make it in the long run is of no concern to these employees. Therefore, communication in this environment is not focused on promoting stability and group acceptance, as it has done traditionally in business organizations. Mostly it is designed to allow people to interact and produce group results faster and more efficiently. It is an extension of the very technology that is creating Internet-driven commerce.

"Absolutely every PR firm - I exaggerate, but a great many of them - is trying to get Internet business," says communication executive recruiter Neil Frank. "And many of the high-tech firms are establishing 'interactive' or 'Internet' operations. So do the big firms Hill and Knowlton and Burson-Marsteller.

"The high-tech firms still are doing it best. The specialty firms are the best in this business. The general management firms are definitely going to be in there, but they are playing second fiddle to the pure high-tech group right now. These bigger firms have learned that they have to get this specialized high-tech help, and they are doing it by mergers and acquisitions in many cases."

Frank has been busy of late searching for experienced communicators for dot-com companies. Some of his candidates for traditional communication executive positions have been lured away to dot-com havens (or is that "heaven"?).

"These Internet companies - as competitive as they are - have got to do it," Frank says. "I don't think they have any choice. And I know what they want. They want people who know consumer electronics, or who know the Internet, certainly who know consumer marketing."

A veteran of 25 years in the communication field, mostly in high-tech industries, Lynn Fisher in mid-1999 joined the Silicon Valley-based Automated Power Exchange (APX), an Internet-based commodity exchange for trading electricity in a deregulated energy world. If the privately held, two-year-old APX succeeds, it will be in the e-commerce realm, and Fisher thinks her broad-based communication past will continue to be an asset.

With her title of "marketing communication manager," she is the closest thing APX has to an in-house corporate communication specialist as it starts its third year, moving to larger offices for its more than 40 employees and expanding to a number of new states in the West, East and Midwest. Fisher presents a very open approach to her work, but among other e-commerce firms, I personally ran into some unresponsiveness - at least to my phone inquiries as a journalist - working on this article. Timeliness and responsiveness were lacking. I sensed some suspicion, perhaps, of someone like me from outside Silicon Valley business circles.

This past summer Jupiter Communication, a national Internet research organization, reported the results of a study that indicated that e-commerce companies need to broaden their business sphere to more traditional channels of commerce, calling it their "off-line assets." Even if it means sacrificing some of their online Internet sales, the firms need to do this to avoid lost sales to their Internet-only competitors. A step in the direction of more traditional external relations work arose this past summer when nine of the titans of e-commerce, including AOL, Amazon, Yahoo! and eBay, announced they had formed a lobbying alliance in Washington, D.C., called "NetCoalition.com."

The study indirectly reinforces for me what Lynn Fisher stresses, namely, the importance of balancing communication among the more traditional outlets: paper, TV, radio and phone-driven mediums and the cyberspace outlets at web sites and online. Jupiter's study showed that the traditional and Internet channels of business need to have what it calls "a symbiotic relationship" that provides synergistic results.

In reality, however, within the same organization sometimes this synergy is not easy to make happen. Many traditional communication companies, for example, continue to struggle with organizational grafting. In itself, this makes more difficult the job of internal communicators who must straddle both worlds.

Even the venerable print empire of the New York Times Company has earlier this year consolidated all of its electronic, web-based operations among newspapers, magazines and television stations it controls, forming Times Company Digital, with the idea of eventually spinning it off as a separate dot-com company through an IPO.

If mainstream media struggle with this medium, corporate organizations with traditional sales and distribution infrastructure and internal human resources and communication infrastructure also must be struggling to achieve the right balance of e-commerce and traditional phone-and-shoe-leather business.

Based on his LA Times experience, USC's Larry Pryor says the analysis "comes down to the question of 'Should traditional communication media go on the Internet with their own resources and keep control, or should they spin off their web operations into a so-called 'tracking stock'?

"There are a lot of reasons for spinning off. Disney is a good example of that. It decided to spin off all of its web operations into a separate company. It generates a lot more capital, allows them to expand much more rapidly, and most important, it allows them to attract the kind of managers they need in these companies: very young, very aggressive, well-trained MBA managers who understand the Internet. Those people are very high priced and won't work today without getting stock options.

"Within the traditional side of organizations, if you try to fold those people in, it can create tremendous animosity. You have these very young managers pulling in salaries and benefits that are greater than people who have been at the company more than 20 years. Disney lost a lot of its young talent because of this factor. Those young managers are extremely valuable assets to a Net organization. The firms don't have physical assets - no plants or distribution - all they have is hardware and software and the young MBAs," Pryor said.

Ultimately, communicators for e-commerce businesses must be aware of this phenomenon, recognizing that either within companies trying to be both traditional and Internet-based or between e-commerce start-ups and their external stakeholders the same cognitive dissonance will have to be resolved. Pryor is candid in his assessment, stressing that it is very easy to make "enemies" if the Internet-based business operations flaunt their high-tech, high-efficiency image.

Growth eventually will thrust communicators into approaching e-commerce the old fashioned way, with sweat and creativity that applies the right media to the appropriate communication strategy. We all know that it isn't "rocket science," but that won't make it any easier for the communicators who ultimately survive the hype.

"Internally, we expect to see a lot of communication go on," says start-up Utility. com's Chris King. "We use e-mail for just about everything and a little bit of voice mail. We do have an internal web site where we post documents and information. That's accessible by all employees and outside directors. You always need to do more, but we're doing our best at this point."

"Broadly speaking, we're pretty happy with the PR we've gotten, says Ed Cazalet, founder/CEO at APX. "We really haven't invested (in the communication area) at least until the hiring of Lynn Fisher." Internally Cazalet's company, like many e-commerce organizations, relies heavily on email and voice mail to keep employees informed about the company's overall progress in achieving its goals.

"We'd certainly like to improve those systems eventually," he says. "As we get larger we'll certainly have to invest in more internal communication programs and equipment."

Cazalet appears to have the right attitude, looking at future communication budget items facing his organization as "investments." More CEOs will need to adopt his attitude.

Richard Nemec is a Los Angeles-based writer and communication consultant.