One of the big responsibilities of public relations practitioners is to communicate organizational change to internal and external stakeholders. No such communication is more closely watched than material that announces CEO change at a company. When leaders step down, resign or are asked to go, it has an immediate impact on stock prices.

This week, I looked at the press releases put out by SAP – a major player in the technology industry. SAP underwent a CEO change in 2010.

You can read the press release announcing this change here.

What I liked about this press release:

  • It is extremely concise but conveys the relevant information
  • It speaks of a “mutual agreement”, so the company has taken a positive approach and appears not to have burned bridges with the departing CEO
  • It talks about going back to an old system of running things (that of having co-CEOs), so the shareholders are likely to think the company is going back to a tried and tested system
  • The co-CEOs have both been appointed from within the company, so there is a sense of continuity
  • It announced further changes to the board
  • The press release recognized the departing CEO’s contributions
  • Lastly, it announces a press conference that will answer further questions – this is very important because journalists will want to know exactly why the CEO left

Overall, the press release conveys a sense of stability of the organization and shows that the board is in control of the situation.

The release does not go into why the company is making so many changes – though no doubt, industry analysts and journalists on the business beat would have heard any rumors.

I looked up SAP’s old press releases to see what kind of communication they put out there in the weeks following the new announcement. I saw that they shortly had this press release announcing further changes.

I thought it was really interesting that they did not announce this in the first press release. Or perhaps they did not have the information about the resignation of a board member at that time.

The media were all over this story and pointed out that the company did not really give a reason for the departure of the CEO. However, the journalists had plenty of quotes from analysts and you can read about that here and here.

Use of Twitter and Facebook:

I checked SAP’s tweets, but I could go no further than  August 2010. So I am not sure if they used Twitter to communicate the CEO change.

This is SAP’s Facebook page. I found no post on February 7, 2010 that was the day the CEO change was announced. I think this is the right move. Social media is not a formal medium to announce such an important change. I think it is ok for certain companies to announce big changes on social media – such as Sprinkles Cupcakes or Twitter – because they already leverage the media. However, I think in the case of SAP, it would have sent a wrong message to stakeholders and would not really have facilitated discussion. Would SAP answer a question posed by one of their fans: “Why the sudden change?” – I don’t think so.