imc 637 final project -- express scripts case study

Case Study: Layoffs and Dissatisfaction Creates Internal Chaos at Express Scripts

Jamie Huggins

IMC 637

Week 9: Case Study

Jamie Huggins Week 9: Case Study !1

image credit: bloomberg.com

Table of Contents

I. Company Background……..………………………………..……………3 II. Company-Wide Layoffs and the Company’s Response…………….…….4 III. Poor Internal Company Culture and the Company’s Response.………….6 IV. Internal Communications Versus External Branding Efforts…………….7 V. Recommended Changes for the Future…….…………………………….8

• Intranet Implementation………..……….…………………………….8 • Leadership Commitment to Transparency……………….………..10 • Encouragement of Social Communication………………………..10 • Create An Atmosphere of Growth by Reducing Layoffs…………11

VI. Measurement of Results…………..……….…….…………………….12 VII. References……..……………………………………………………….13


Every organization is vulnerable to suffering from serious internal issues. These issues

could range from a crisis, to poor internal communications, to layoffs, and even mergers. They

can suddenly strike, or they can be the result of years of bad decisions, but the worst thing a

business can do in these types of situations is not be prepared. Express Scripts is one of

America’s largest managers of prescription drug services. The corporation has tens of millions

of customers, thousands of clients, and fills over a billion prescriptions per year. However, even

with those impressive numbers, Express Scripts has a very poor internal communications record

due to massive layoffs and employee dissatisfaction. This case study will briefly discuss Express

Script’s company background, issues the company faces, recommendations for the future, and

methods to measure results.

Company Background

Since Express Scripts founding year of 1986, the company states that it has been their

mission to help make the use of prescription drugs safer and more affordable. Throughout the

years, Express Scripts has grown to be one of America’s largest managers of prescription drug

services. Today, the corporation manages “prescription benefits for tens of millions of

Americans on behalf of thousands of clients, including health plans and plan sponsors.

Employers, unions and government organizations throughout the nation rely on their

services” (About Us, 2015). Furthermore, after acquiring Medco Health Solutions in 2012, the

company fills a staggering 1.4 billion prescriptions per year.

Express Scripts currently employs approximately 30,000 employees (About Us, 2015).

Express Scripts claims that their employees truly make a difference in peoples’ lives, because of


the company’s commitment to excellence and pride in a job well done. In addition, they state

that they are one of the fastest growing companies in the United States (You Belong Here, 2015).

Furthermore, Express Scripts states that they provide their employees with “the resources,

rewards, recognition and development opportunities that empower them to maximize their

performance, career potential and financial success” (You Belong Here, 2015).

Express Scripts is involved in mediocre marketing efforts, which include monthly

financial statement press releases and a small-scale social media presence. Express Scripts has

created a company Facebook page, a Twitter account, and LinkedIn account. Their Facebook

page only has 1,337 “likes,” which seems small for the amount of customers, employees, and

growth they claim they are experiencing. Posts seem to center around showcasing employees or

events that the company is hosting. However, their “Posts to Page” section is filled with

negative comments from customers bashing the company for high overcharges and poor

customer service. Express Scripts’ Twitter account has 12,700 followers. Their Twitter account

seems to post less about the company and more about general health and pharmacy-related news.

The small amount of posts that do cover company news, typically contain comments from upset

customers complaining about Express Scripts’ policies. Finally, Express Scripts’ LinkedIn

account appears to be a place where the company shares internal career opportunities.

Company-Wide Layoffs and the Company’s Response

Though Express Scripts’ claims that they are one best and fastest growing companies in

the United States, this is quite contradictory to the truth. Express Scripts was actually rated one

of the worst companies to work for in the United States. After it acquired Medco Health


Systems, "Express Scripts began a major workforce consolidation that included layoffs after it

closed the deal in early 2012” (McIntyre, Sauter, Hess, & Weigley, 2013). However, these

massive layoffs did not stop in 2012. In early 2014, "Express Scripts notified the State of Florida

that it would lay off close to 400 people at its facility on Hillsborough Avenue in Tampa, due to

lower prescription volume” (Huff, 2014). Those 400 jobs in Tampa were part of close to 1,900

nationwide Express Scripts layoffs and 2 corporate facilities closings. Brian Henry,

spokesperson for Express Scripts, previously stated that the reason for these layoffs was because,

“the company needed to 're-balance its resources’” (Liss, 2014). As of last month, Express

Scripts layoffs continued — this time, with an additional 256 employees laid off at its Tampa

Bay location. “This cut leaves pharmacists, pharmacy technicians and administrative staff out of

work. 'We're currently overstaffed in these areas,' said David Whitrap, the company's corporate

communications director. A remaining 150 employees will now transition to call center jobs and

work from home, he said, leaving the entirety of the company's bay area operation at just 180

people” (Crosby, 2015).

As stated previously, Express Scripts officials responded to the layoffs with mixed

answers and reasoning. For example, in the company’s late 2014 layoff, spokesperson Brian

Henry stated, “‘We are looking across the organization to find ways to be more efficient and

effective. And that means we will move resources to where client and patient needs are

greatest.’ Asked why the company is cutting jobs when it had promised to add employees, Henry

said, ‘We have met or exceeded all commitments we have made, and we expect that to

continue’” (Liss, 2014). In other words, it seems that these layoffs were a “profit over people”

decision for Express Scripts.


Even worse, the company offered its employees little-to-no notice about the upcoming

layoffs. Consider this former employee’s review on Glassdoor about the recent Tampa layoff:

“We were all hired on November 10, and our probation ended on February 10. They had

another group of 75 start in November. Today, we all lost our jobs. All associates hired in

October and November no longer have jobs. No real explanation was given today. After our

meeting, we had minutes to grab our stuff and get out” (Express Scripts Reviews, 2015). The

fact that no warning given was given is alarming, and it seems to show that there is a lack of

proper protocol and internal communications channels being implemented at Express Scripts.

Poor Internal Company Culture and the Company’s Response

In addition to these massive layoffs, there are other reasons employees do not like

working for Express Scripts. “Employees are dissatisfied with the company. They feel

pressured to reach key metrics and often complain that reaching these numbers was more

important to the business than adequate customer service or employee well-being” (McIntyre et

al., 2013). Because of this, the employees, who are left, feel overworked. Actually, “too heavy

of a workload” is the top cited employee complaint about Express Scripts. “One aggrieved

employee wrote that the company gives 'the appearance of a work/life balance . . . but the truth is

everyone is overworked’” (McIntyre et al., 2013).

Express Scripts often chooses to not respond to employee and consumer claims of poor

internal culture. For example, on social media, negative Facebook comments and Twitter posts

often go ignored by the company. Those that they do choose to respond to, often harness

unsympathetic, generic remarks that do little to soothe the upset party. Furthermore, there is


even a Facebook page called “Express Scripts/Medco Worst Company Ever,” where employees

and consumers alike regularly post complaints about the company.

Glassdoor’s employee review section gives a first-hand insight on what it is really like to

work for this company. One recent reviewer in February states, “No input from employees is

taken into consideration. Managers are always right. HR always sides with management.

Working there seems like modern day slavery with a pay check. If management messes up, they

get to take management classes to better their skills . . . as many times as needed. If an employee

messes up, they’re fired . . . no warning” (Express Scripts Reviews, 2015). This review shows

once again that Express Scripts fails to give change warning to its employees — both before

layoffs and before firing employees. Sadly, Express Scripts does not appear to hold employees

or their overall satisfaction in high regard, and this decision is seriously affecting their company.

Internal Communications Versus External Branding Efforts

It can be seen from the aforementioned information that Express Scripts’ internal

communications do not align well with their external branding efforts. “The intrinsic part of a

brand's value, brand equity, may be positive or negative, meaning that a brand name can be used

to increase overall utility of a choice, or may detract from the overall utility of a

choice” (Measuring Brand Value, 2013). Express Scripts’ brand equity would certainly be

considered negative. Interestingly enough, even though the company tries to promote positive

brand equity across its website and social media pages (i.e. a fast growing company, happy

employees, and a strong mission statement), Express Scripts cannot shake their negative brand

connotation. For example, Express Scripts may share a picture on Facebook about great


company culture, but beside the picture, are a slew of employee posts complaining about layoffs.

On their website, Express Scripts may share that their employees are happy and loyal to the

company, but a quick Google search reveals that employees hate working for the company.

What Express Scripts is trying to promote to the world, and what the company is doing internally

are two very opposite things.

Recommended Changes for the Future

Intranet Implementation

Since there is no evidence of a company-wide intranet, it is recommended that Express

Scripts create and implement an intranet as soon as possible. “An intranet is a network designed

to serve the internal informational needs of an organization using Internet concepts and tools.

Intranets create a common communications and information-sharing system and can be used on a

'push' basis, where information is presented to employees, and on a 'pull' basis, where employees

may seek out and retrieve information for themselves” (Averwig, 2008, p.3).

Once developed, it is recommended that Express Scripts publish daily or weekly intranet

updates under a heading designated for upcoming changes (i.e. any future layoffs). This will

give all of their employees a fair warning that change is coming, and it will give the employees

the ability to ask any questions they may have about the upcoming change. Best of all,

employees can figure out about changes before the outside world knows of them. Finding out

about company layoffs in the local news is not good for employee morale or trust in the

organization. “One organization facing mass layoffs developed an intranet website titled,

'Straight Talk.' This site included the most current information about the budget, layoff policies,


plans and outplacement resources. Even if the employee couldn’t find a manager to speak with,

they could count on this site for the most up to date information. Granted, it doesn’t replace the

need for face to face conversation, but it is a tool that can help a company to put out a consistent

message” (Green, 2015).

Besides helping increase layoff transparency, the company-wide intranet would offer

Express Scripts other advantages to help improve its internal culture. These advantages include:

a fast system of communication, less rumor growth, help improve managerial productivity, help

eliminate the latency of information in the enterprise and make the flow of information need-

driven rather than availability-driven (Pujari, 2015). Furthermore, an intranet could help Express

Scripts improve their poor customer service reputation. “Customer service often becomes an

area of emphasis in intranet development. In 1996, MCI upgraded an application that supported

8,000 customer service representatives from a text-based IBM terminal interface to a browser-

based intranet interface. In March 1997, the firm introduced Webster, which provided these

employees with web access to more than 600 products and services. Because the new interface

was simple to follow, and users could create and update customers' data, the department

estimated that it reaped a $12 million return in 1997 on its investment” (Korzeniowski, 1998, p.

62).

Leadership Commitment to Transparency

It is imperative that the leaders of Express Scripts be committed to consistent and

ongoing communication throughout any current or future layoff processes. Supervisors should

be told first. After that, all other employees must be told in person. “Employees should hear the


news in person from a manager and not via outsiders, email, telephone, mail, or the

media” (Amme, 2014). This way, Express Scripts’ employees will know that leadership told

them as early as possible, and there would be no more surprise meetings. Future layoff

announcements should be spoken with sincerity, compassion, and respect towards those affected.

Express Scripts could also consider conducting weekly CEO webcasts since their offices

are spread all across the United States. “The organizational leader needs to be seen and heard and

should be sharing his/her thoughts and plans as often as possible. The longer the leader remains

silent and faceless, the greater the resentment employees will have” (Green, 2015). These

meetings should be followed up with weekly Town Halls. “When they are held consistently over

time, employees know that they can count on an opportunity to hear the latest developments

related to the change and they have an opportunity to be heard themselves” (Green, 2015).

Encouragement of Social Communication

Socialization is a main component of happiness, and Express Scripts should find ways to

encourage social connections among its employees, rather than making them feel alienated. For

example, Express Scripts could consider social media’s role in their future internal

communications efforts. Since Express Scripts already has a Facebook page, it might be wise for

them to also create a closed Facebook group only for Express Scripts employees. "Closed

Facebook groups are getting more and more popular for organizations. Several companies have

either found unsanctioned groups, or they have established them as a formal means of facilitating

communication. Facebook is already a primary venue for images; roughly half of any newsfeed

is made up of photos and graphics. In a closed group, employee communications could share a


wide range of images, create albums, and encourage employees to share” (Holtz, 2013). This

would help build a sense of employee camaraderie among Express Scripts employees and help

them feel more connected to the company.

Create an Atmosphere of Growth by Reducing Layoffs

Considering all of the layoffs and bad press that Express Scripts has suffered, it is

imperative that the company focus on creating an atmosphere of internal growth within its own

walls. Thus, it is recommended that Express Scripts should consider other alternatives to their

layoffs if possible. “Although a company's stock price often rises in response to a massive

layoff, the long-term results of eliminating the people who spent years building corporate assets

adversely affect the firm's revenue stream and reputation” (Genn, 2001, p.40). Some alternatives

to company-wide layoffs are as follows: offer extra days of unpaid leave, exchange workers with

other employees, institute shorter work weeks, cut part-time staff and contractors, consider a

virtual office, or consider wage and benefit cuts. Though not all ideal alternatives, they would

help decrease the cost of how much these layoffs are going to cost Express Scripts in the long

run — i.e. severance packages, alienating employees, litigation, massive morale hits, and

possible recruitment and training of new employees in the future (What are Alternatives to

Layoffs, 2015).

Measurement of Results

• Statistical Measurement: Once a company-wide intranet is implemented, Express Scripts can

measure its results with statistics. “Monitoring the stats will help a company come to an

understanding of how people currently use the intranet, if they interpret the numbers with


appropriate context” (Intranet Metrics & KPIs, 2014). Express Scripts should measure the

following areas of its intranet: tasks/workflows completed, profiles created, internal goals,

contribution numbers, contributor engagement levels, and even page views.

• Surveys: Express Scripts should implement both electronic and hard-copy surveys to gain

employee feedback on changes the company implements — i.e. social communication efforts,

leadership transparency levels, the new intranet (usability, feedback), and internal growth

efforts within the company. It may be wise to also survey employees, who were laid-off, to

see where Express Scripts could have handled the process better.

• Focus Groups: Express Scripts can use focus groups to gain group feedback about

implementing the changes recommended in this case study. Express Scripts can ask

employees what they think are other options to the layoffs, what leadership can do better, and

what changes they would like to see happen at the company. This would hopefully increase

engagement and sense of belonging and purpose.

In conclusion, Express Scripts is a company plagued by serious internal issues resulting

from frequent layoffs and employee dissatisfaction, but there is hope. If Express Scripts can

make drastic internal changes such as: implementing and measuring an intranet, committing its

leadership to transparency, encouraging internal social communication among employees, and

creating an internal culture of growth by finding alternatives to the layoffs — it is believed that

this company will have a valiant chance at improved employee retention and internal growth.


References About Us. (2015). Express Scripts. Retrieved March 9, 2015, from https://www.express-

scripts.com/aboutus/

Averwig, U. (2008, January 18). Developing an Intranet Towards Knowledge Sharing: A

Practioner-Based Inquiry. South African Journal of Information Management, 10.

Retrieved March 9, 2015, from http://www.sajim.co.za/index.php/SAJIM/article/view/7/7

Crosby, R. (2015, February 18). Express Scripts lays off 256, reduces Tampa operation to at-

home work. Tampa Bay Times. Retrieved March 3, 2015, from http://

www.tampabay.com/news/business/express-scripts-plans-more-layoffs-in-tampa/2218098

Express Scripts Reviews. (2015). Glassdoor. Retrieved March 9, 2015, from http://

www.glassdoor.com/Reviews/Express-Scripts-Reviews-E2212.htm

Genn, A. (2001, September 28). Creating Alternatives to Layoffs. Long Island Business News,

48. Retrieved March 9, 2015, from http://search.proquest.com.www.libproxy.wvu.edu/

docview/223624025?pq-origsite=summon

Green, M. (2015). Laying Off? Communicate Early and Often. Outplacing. Retrieved March 3,

2015, from http://www.outplacing.com/laying-communicate-early/

Holtz, S. (2013, October 8). Six Ways to use Social Visual Media for Internal Communications.

Holtz Communications. Retrieved March 3, 2015, from http://holtz.com/blog/content/

six-ways-to-use-social-visual-communications-for-internal-communications/4214/


https://www.express-

Huff, P. (2014, April 30). Express Scripts' Lower Volume Leads to Close to 400 Tampa Layoffs.

Tampa Bay Business Journal. Retrieved March 3, 2015, from http://

www.bizjournals.com/tampabay/news/2014/04/30/express-scripts-lower-volume-leads-

to-close-to-400.html

Intranet metrics & KPIs – Only Measure What You Mean to Act Upon. (2014, May 15).

Intranetizen. Retrieved March 9, 2015, from http://www.intranetizen.com/2014/05/15/

intranet-metrics-kpis/

Korzeniowski, P. (1998, October). Intranets Are “In.” Utility Business, 1. Retrieved March 9,

2015, from http://search.proquest.com.www.libproxy.wvu.edu/docview/195770602?pq-

origsite=summon

Liss, S. (2014, April 30). Express Scripts to cut 1,890 jobs, Close two Facilities. St. Louis

Business Journal. Retrieved March 3, 2015, from http://www.bizjournals.com/

stlouis/ blog/health-care/2014/04/express-scripts-to-cut-1-890-jobs-close-two.html?

page=all

McIntyre, D., Sauter, M., Hess, A., & Weigley, S. (2013, July 19). America’s Worst Companies

to Work For. 24/7 Wall St. Retrieved March 3, 2015, from http://247wallst.com/special-

report/2013/07/19/americas-worst-companies-to-work-for-2/2/

Pujari, S. (2015). Intranet: Advantages and Disadvantages of Intranet for Business Enterprises.

Your Article Library. Retrieved March 3, 2015, from http://www.yourarticlelibrary.com/


networks/intranet-advantages-and-disadvantages-of-intranet-for-business-enterprises/

10460/

What are Alternatives to Layoffs? (2015). The Wall Street Journal. Retrieved March 9, 2015,

from http://guides.wsj.com/management/recruiting-hiring-and-firing/what-are-

alternatives-to-layoffs/

You Belong Here. (2015). Express Scripts Careers. Retrieved March 9, 2015, from http://

careers.express-scripts.com


imc 637 final project -- express scripts case study

Marketing