Outsourcing

The Few & the Many: Free Trade, Outsourcing, & Communication By Robert Abbott

Have you noticed that some sound ideas get bad publicity? Two I have in mind are outsourcing and free trade.

No doubt you could name others, but looking at these two initiatives helps us understand a communication challenge for many companies and not-for-profit organizations.

Free trade and outsourcing both produce a few (well, relatively few) big losers, and many (very many) small winners.

More specifically, free trade leads to big losses for a relatively small number of companies and their employees. Companies can go out of business or be forced to drastically restructure; employees can lose their jobs. The adjustment pains they suffer are very real and very significant.

On the other hand, all consumers in a country that adopts free trade are winners. In other words, just about everybody. The gains for each person are small, yet, taken together those gains far outweigh the losses suffered by the losers. And the gains keep paying dividends year after year.

The story is much the same for outsourcing. A few employees take a very big hit, losing their jobs. At the same time, though, a lot of other employees get to keep their jobs because their companies become stronger. A few suffer for the many.

Which do you hear more about? You hear far more about the losers, of course. Why? Well, as a former news writer and announcer I can tell you that losers holler louder and longer. They actively seek media coverage. And that's not all: stories about layoffs have an inherent drama that stories about the preservation of jobs just can't match.

In addition, small-scale winners often don't know they've won, how they've won, or what they've won, so they don't march in protest or call news conferences. Add to that the general principle that good news isn't big news.

What do you do if you face a decision leading to many small winners and a few big losers? First, hammer away at the context, at the circumstances that drive the decision. For example, don't announce to employees that a new piece of equipment that does the work of three people will make you more efficient. Rather, explain the competitive pressures that force greater efficiency, and the consequences of failing to meet those pressures.

Don't assume everyone shares your knowledge. Few stakeholders understand the broader picture, and even if they could, the pressure of day-to-day events may keep them focused on just one piece of it. It's essential to start with as few assumptions as possible.

Communicate frequently: in advance, during, and afterward. Explain the problem, outline the options, list the decision criteria, announce the solution, and report on how well the solution has worked. Or not worked, which becomes the new problem.

You won't convince everyone your decision is the right one, but you might convince enough people to make further progress possible.

In summary, when a few people suffer big losses and many others make small gains, you can expect the losers to complain very loudly, and the winners to say little or nothing. To deal with these situations, communicate frequently and carefully.

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