On April 24, Caterpillar announced its quarterly earnings. As the CFO ticked off some of the company’s major accomplishments during the quarter, both the market and industry analysts seemed to like it. In fact, the stock was up 5 percent… until something happened.
With an off-handed, throw-away remark from the CFO, the market heard something concerning, and the company’s stock plummeted, ending 6 percent below where it started the day. With just a moment, the company saw millions of dollars in value disappear. This is why message discipline is so very important, whether on an earnings call, during a television interview or in the midst of a crisis.
The words were rather unimportant. The CFO simply said the quarter’s profits were a “high-water mark” for the year. Unfortunately, what the CFO was intending to say was that commodity prices were lower than expected and created a greater than expected profit margin, which could not be counted on in the future. It was not intended to preview anything about the company’s performance in the coming months, and it was certainly not something included in talking points prepared by the communications team. But before the call had even ended, the damage was done.
So what can we learn from this? I’ve outlined three key points that communicators must keep in mind at all times, especially when speaking for a publically traded company that is constantly being scrutinized by the market.
Always be “On”
When you are talking to reporters or analysts, you must always be “on.” That’s on message, in both verbal and non-verbal ways. If you are on camera, a grimace can speak volumes and outweigh your words. So ask yourself: What is my face saying? Is it consistent with my language?
You must also ensure you are careful with your language. Using colloquialisms can sometimes send unintended messages, especially to audiences unfamiliar with them. Instead, use simple, clear language so misunderstandings can be avoided.
Focus on Key Messages
Just before you begin speaking, always review your talking points one last time. Sure, you’ve read them countless times already, and hopefully even rehearsed them. But it never hurts to go over them one more time. Ask yourself: Do you know your three main messages? Have you considered how to emphasize each of your main points appropriately? Finally, what would you want the headline to read for your talk?
Flag and Bridge
Pick out some key phrases from your talking points as a reference. In addition to the major bullet points, this should also include bridges and flags. Highlight, bold or add bridging and flagging phrases to your talking points and sample responses, such as:
- Historically yes, but today the reality is…
- That remains unclear right now, but I do think we can say at this point…
- The most important item to remember is…
- Let me underscore one issue…
We can all relate to the CFO who unknowingly created a problem for his company with his off-handed remark. To avoid this for you and your organization, remember these recommendations so you can stay on message and on target with your goals. Words matter and we all know how critical language is, especially when speaking for a public company, so remember to speak clearly and thoughtfully to effectively get your message across.Contact Us