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Custom-made Leader

Combined with already exceptional skills, climbing the management ranks to the top of HR at SBC has given Karen Jennings the tools for ultimate success.

Saturday, October 16, 2004
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When SBC Communications Chairman and CEO Ed Whitacre Jr. asked Karen Jennings to take the company's human resource reins in 1998, the long-time SBC soldier briefly wondered if she was being sent to the corporate version of Siberia.

After all, Jennings had joined Southwestern Bell in 1972 on the business side, wending her way through the ranks in the comptrollers, customer services and revenues, and the public affairs departments. In 1995, she served as chairman of SBC Asset Management Inc., and associate vice president in the Chairman's Office for SBC.

After serving as president of Southwestern Bell in Missouri in 1996, she became vice president and general manager of operation services for SBC Telecommunications Inc. In that role, Jennings had responsibility for operator services and directory white pages for the seven-state territory of Southwestern Bell, Pacific Bell and Nevada Bell.

With that resume as a backdrop, a move to HR wasn't something, she admits, that was part of her personal career plan. But far from sending Jennings into oblivion, Whitacre's strategy was to put someone with her track record in the business units into the role of senior executive vice president of HR and communications because he needed someone he believed could help HR really get into the trenches, and help the company at one of its most important turning points.

"Honestly, I was a little concerned when my boss asked me to take the job," Jennings says in the Texas drawl she acquired when, as a teenager, her parents moved the family from Michigan. "In our culture, we serve the business units, and I had been in almost every part of our business network, so I did have a good appreciation of what SBC was all about."

Apparently, that's exactly what Whitacre was thinking.

"Karen is a valued member of my core leadership team," he says. "She has guided a leading-edge HR organization that not only plays a strategic role at SBC, but is a model for other companies. And her dedication, great attitude and caring spirit are appreciated by employees across our company."

To hear her speak is to hear that spirit come through loud and clear. And, according to those who know Jennings and work closely with her, it's the same spirit that has guided her through some potentially treacherous HR waters on several fronts -- mainly as a key leader for San Antonio-based SBC as it went through a recent weeklong work stoppage that ended with a win-win contract for the 100,000 or so SBC union workers (One of the four so-called Baby Bells, SBC has about 167,000 employees in 13 states).

Always on the Move

Her recent success string doesn't end there. Apart from her general responsibilities in executive support, labor relations, training and development, employee and financial communications, advertising and media relations (the latter three being an unusual aspect to a top HR job), Jennings has also guided her department and SBC through some other major hurdles.

For starters, she has overseen a number of innovative programs that have improved SBC's delivery of HR services, including a new employee self-service platform. Several specific HR initiatives have also led to a direct savings of $300 million.

On the health-care front, for example, while SBC has increased employee contributions and co-pays to reduce costs, Jennings has led an effort to help employees be better health-care consumers through a variety of tools and education programs, including modeling tools for annual enrollment, as well as new platforms for long-term planning and online second opinions.

She has also been working hard with vendors to improve services and systems, and recently renegotiated contracts that will directly save $200 million through 2006. Another Jennings-led initiative, an absenteeism-reduction program launched in 2003, led to a 14 percent absenteeism reduction, representing $55 million in savings. Specifically, Jennings instituted an intense awareness program on the issue for all employees, as well as a mandatory Web-based training program and tracking tool for supervisors.

Since Jennings became its HR leader, SBC has been named the "World's Most Admired" telecommunications company by Fortune magazine for six consecutive years, and SBC supplier diversity efforts have been recognized by Fortune and Working Woman magazines. Fortune also ranked SBC as one of the "Top 50 Best Companies for Minorities" (No. 1 among telecom companies).

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One would be hard-pressed to suggest Jennings' line-management career did not directly lead to HR success. It would also be safe to suggest that her charming, yet forceful, personality has been one of her most effective weapons. "Bottom line, I love working for her," says Margaret Cerrudo, HR senior vice president at SBC. "Karen's a positive leader, with an inclusive style. She can be forceful when necessary, but she gives you so much freedom and autonomy."

As HR executives go, says Fred Brown, a partner with Accenture HR, Jennings is almost too good to be true.

"Karen is one of the leading HR executives anywhere," says Brown, who has worked with her for the past year on HROneStop, SBC's employee self-service program. "She's open to every new idea, and that makes it very exciting to work with her. Most of all, she immediately makes you feel like you've known her for a long time."

Nevertheless, both Cerrudo and Brown say, Jennings' open personality and optimism are tempered by a toughness necessary for success in her job. "Karen's got a very strong leadership style and, when things are not going the way she wants, she's not afraid to make hard decisions," Brown says.

If one of her people is not hitting the mark, Cerrudo adds, Jennings will be very direct, though never threatening or demeaning. "She [addresses the situation] in a way that makes people want to be better," he says.

In Jennings' view, HR is a business, not just an internal cost. Despite her early trepidation, she finds her role fulfilling. "I've had the luxury to serve external customers in my former jobs," she says, "and now the challenge is: How do we give our internal clients who face external clients a good value on the people we secure, and the benefits and training we deliver. We're under a real microscope."

Although it took her a little time to figure out that HR is about creating the human assets that serve external customers, she adds, the other critical part of the equation is being a necessary management partner, someone senior management wants at the table.

"From what I have seen, Karen has more of an understanding of the needs of the business than someone who has been in HR for 30 years," says Brown. "She's one of a kind."

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