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Whats in a name?

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Employees are often the last to know when a company changes its name because of restructuring, merger or takeover. By Larissa Bannister

Changing the name of a business means a fundamental internal shake-up. It affects the image presented by staff to customers and it can involve a change in strategy which deeply affects the way employees work. Even if it is a corporate event involving an umbrella name that sits above individual businesses, a name change still has a great impact on staff.


Many companies commission consultants to look at how a name change will affect the customers or shareholders perspective. But looking internally is at least as important, as HR issues can be forgotten in the desire to create a strong external brand.


Chris Parsons, principal consultant at Penna Change Consulting, says that the HR department must be involved in any change of this kind from the very start.


Human resources has a real role in defining and embedding the culture of a business and needs to be involved long before the decision is taken to change the name, he says. In the case of merger or acquisition, HR should be involved in the identification of any target they know what will be a good fit with the company from a culture point of view.


Steel company Corus changed its name following the merger of British Steel and Dutch business Hoogovens NV. The HR directors of both companies were members of the steering group that implemented the merger and worked on the name change.


HR helped come up with a new name, logo and strategic direction before being given the task of communicating and implementing the changes. We chose to position the brand strongly internally, says Kees Blokland, director of personnel development. This wasnt so difficult because we had defined the characteristics we wanted in a new name according to the spirit of the corporation, and Corus fitted well.


Culture is harder to build than brand, he says. At first we had a steering group to study the new common culture but then we realised that you have to let it grow by itself, he adds. Of course it works best where people from the two businesses are working together so we have created bridges through management courses and job swapping to connect employees. You have to impact on the behaviour of people, otherwise you cannot make change happen.


Paul Taylor, employee relations manager at Kelda, formerly Yorkshire Water, recalls a similar experience. Here, HR was also involved in the project team that came up with the new name, albeit in the guise of internal communications. The groups message about the new name and strategic direction was delivered via an electronic news system, through teamtalk briefings from line managers in the company magazine and via a special booklet. Reassurance is important at this time, says Taylor. There was a lot of attachment to the Yorkshire aspect of Yorkshire Water, so we had to explain that the brand remained although the overall company name had changed.


Even where the strategy of individual businesses is largely unchanged, employees need to feel involved if they are to accept a new name.


When Bass was forced to change its name after selling its brewing business, the company decided to run an internal competition to come up with a new identity. The response was substantial, and it got people talking about the change, says Emma Chadwick, director of employee communications.


The Six Continents name was suggested by two employees and was subsequently agreed by the name-change project team and internal and external focus groups.


Chadwick was the HR representative on the project team that managed the process. The strategy of the business remained unchanged so no change to vision or values was necessary, she says. We retain brand-focused business units so peoples day-to-day responsibilities did not change and neither did the name of the business unit they worked for but it was important that they understood the effect at corporate level.


In these cases, HR was involved at an early stage. But in some businesses, HR is only brought in once all the decisions have been made, as a communicator or implementor.


E-commerce business Elevon changed its name from Walker in January this year. The group that came up with the new name and is currently working on new values for the business consists of the company president, CEO, sales and marketing directors but no HR.


Elevon did conduct focus groups with managers to discuss the new name with employees, but director of HR Kevin Lyons main role was communication which involved a launch meeting for all staff followed by further communication via email.


According to Barry Bloch, a partner at Smythe Dorward Lambert, focusing solely on communication can be dangerous. If HR is not involved in formulation of the new name and culture then they may not fit well internally, he comments. There is also a danger that HR staff may not fully understand the need for change or its effect.


But when the change comes from an overseas-based parent as with Elevon HR may have no choice but to get involved late on. Sarah Rowland-Jones, HR manager at Proquest Information and Learning, was faced with such a situation after the business was bought by a US company.


There was a staff competition to find a new name but there were not that many suggestions from the UK business the employees didnt really feel part of the whole company at that time, she says. When they decided on Proquest, there was a feeling of disappointment from employees here it already existed as the name of one of our products and people thought it sounded a bit too American.


In Proquests case, communication was driven by marketing and HRs only involvement was to organise the internal communication process, rather than decide on the content or delivery. A set of new values also came over from the US but again these have struck little chord with the UK staff. Weve come up with our own vision which is more relevant for us, says Rowland-Jones.


Another problem was a grey period before the launch of the new name when we had to call ourselves Proquest when speaking to customers but the employees hadnt had the change explained, she adds. It also took a long time for signs and so on to be replaced. My advice to others would be to try to ensure all the change happens at the same time.


A number of companies approached while compiling this piece declined to participate, either because they had no HR department at the time they changed their names as with Arriva and software business Anite or, like e-commerce company Izodia, because HR was not involved in the process at all.


These name changes may still have worked internally, but without HR you run the risk of failure, says Bloch. HRs involvement is imperative. Consignia is the classic example of how it can all go wrong. If the name ends up being meaningless to employees then the change will fail.


Just prior to the time of writing, Allan Leighton, Consignias chairman, admitted that people had not taken to the new name for the Post Office and expressed a desire to change it back. It cost the Post Office an estimated 1.5 million to change its name in the first place. Its an expensive thing to get wrong.