Second City Communications Inc. sells a service that's trickier to deliver on than most: bringing humor to corporate America. In its own digs, however, funny's not a problem

Joe Keefe is a human dipstick: always testing his customers' comfort levels. Leaning back in his chair -- his head almost brushing the casual tableau of bottles (aspirin, mouthwash, bourbon) arrayed on a shelf behind him -- Keefe listens intently to Lauren Price, whose voice is being channeled through a speakerphone into his Chicago office. Price, director of sales development for People magazine, has retained Second City Communications (SCC) to run a workshop at her company's annual sales meeting, and she wants assurances from Keefe, the SCC cofounder, that no People employees will be made uncomfortable by, for example, being required to fall backward into the arms of any other People employees or having to do anything alone on a stage. Solemnly, Keefe pledges that workshop participants will remain upright and in groups at all times. "We want your people to feel they're in a situation of total security," he tells Price, in the kind of soothing tones you'd expect to hear issuing through a confessional screen. "If you have any more questions, feel free to call back in the afternoon when we're sober."

Keefe's demeanor -- pitched between the executive aplomb of King Lear and the irreverence of Lear's jester -- is a business requirement given SCC's not-always-compatible audience and ancestry. SCC is the offspring of the Second City Inc., known for its edgy, improvisation-driven shows (the current production features a running gag about a dentist who molests female patients) and the Emmy Award­winning 1980s television series, which took potshots at Mother Teresa and other targets who were clearly asking for it. SCC's audience is a different crowd -- ordinarily straight-edged business folk engaged in the risky business of exposing their organizations' delicate sensibilities to the emotional and intellectual bungee jumping that is comedy. Not surprisingly, corporate customers demand a humor that is simultaneously cutting edge and incapable of so much as nicking a finger. "Big issues become funny when you bring them down to a personal level," explains Keefe. "But you've got to be careful not to make them too personal."

It is that tension between safety and satire that has traditionally rendered oxymoronic the very notion of corporate comedy. Forward-thinking companies yearn to exploit the genetic links among humor, creativity, and morale, but they cringe at the possibility of lawsuits erupting from off-color E-mail or the odd Seinfeld reference. Consequently, those hoping to season bland corporate cultures with a dash of levity often gravitate toward the most sanitized options: forcing their staffs out to the miniature golf course for some putting at windmills, for example, or hiring humor consultants who urge employees to find the elf in self while pummeling one another with Toobers & Zots. "The corporation is the epitome of safety, and humor and safety can't coexist," says that Jonathan Swift of business culture, Dilbert creator Scott Adams. "If you don't have a little danger, it's not going to be funny."

Danger, by Adams's definition, exists when someone is shown "doing something dumb." That's victimization in the lexicon of SCC, which offers seminars, speaker training, customized comedy shows, corporate-video production, and assorted other items that cry out for bullet points. At SCC, victimization is taboo. So are profanity, sexual innuendo, and other mainstays of its parent company, the incubator that hatched such celebrated gut busters as John Belushi, Martin Short, Bill Murray, Mike Nichols, and Elaine May.

Joe Keefe launched SCC to "bring comedy where it is most desperately needed, which is in business."

Despite the fact that SCC shares its name, pedigree, location (Chicago's nightlife-saturated Old Town), and some performers with so irreverent a parent, hundreds of businesses -- from politically correct Web start-ups to transgression-phobic Fortune 500 companies -- have trusted the group with their events. Stranger yet, SCC is funny, even with the gloves on. That's because, while it eschews cruelty, the company eagerly sends up the bad habits, entrenched conflicts, and unfathomable processes that prevent the corporate equivalent of harmonic convergence. The video created for a giant consulting firm suffering from acronym metastasis, for example, featured an "Andersen Consulting to English Dictionary" and an employee who used pie charts to talk to his dog.

"Some of our clients are real uptight because they don't know what to expect," says performer and director Claudia Wallace. "Second City is famous for some pretty wild comedy, and they're afraid we're going to push the bounds. They say, 'Look, I'm taking a big step bringing you guys in here, and I want everyone to see it as a good move.' We have to make them trust us."

One reason customers are willing to take that risk may be their desire to be more like SCC itself: a profitable, entrepreneurial company with, to paraphrase Melanie Griffith's character in the movie Working Girl, a head for business and a bod for fun. SCC has grown steadily in the 10 years of its existence: it currently boasts sales of about $2.5 million and expects that figure to increase to $10 million in five years, bolstered by freshly minted offices in New York City and Los Angeles. Yet the company's culture remains giddily buoyant, a place where work and play are practically synonymous and where the mayhem engendered by rapid growth actually feeds productivity. Companies pay SCC to show them their reflections in a fun-house mirror; SCC's own reflection needs no such distortion.

Both the preaching and practices of SCC derive from an elaborate theory of creativity promulgated by Keefe, the company's executive producer, monsignor of comedy (an official title), and self-proclaimed doddering figurehead. A compact man with Drew Carey glasses and Phil Hartman hair, Keefe bounds around SCC as though he had wire coils on the soles of his shoes. His office is vintage wise guy, from the large inflatable bottle of Moosehead beer, to the plaster statue of W.C. Fields, to an unnerving quantity of memorabilia related to the Three Stooges, characters whose faces also adorn Keefe's tie. In fact, Larry, Moe, and Curly are the knuckleheaded prophets behind much of Keefe's philosophy. "The Stooges support chaotic thinking," the monsignor explains. "They had very simple solutions to very complex problems. Most of what the Stooges did was take the shortest distance between two points, even if it upset everyone around them. That's brilliant creative thinking."

Keefe is something of a Chicago comedy institution, having launched his career by playing area coffeehouses at the age of 13. Following an unimpressive-verging-on-embarrassing college career, he dabbled in legitimate theater and, with his brothers, ran a locally famous comedy club that employed such nascent bright lights as Saturday Night Live alum Nora Dunn and Dan Castellaneta (the latter better known as his two-dimensional incarnation, Homer Simpson). In fact, Castellaneta and Keefe auditioned for the Second City together in the mid-1980s. Both were hired as performers, but Keefe eventually left the stage ("at the audience's insistence," he says) to produce and direct shows both there and at other theaters.

In 1990, Keefe and Andrew Alexander, who, with a partner, had bought the Second City five years earlier, launched Second City Communications to "bring comedy where it is most desperately needed, which is in business," says Keefe. The new company (or "the bastard child," as Keefe calls it with a throaty cackle) has generated enough revenues to save the theater from having to continually raise ticket prices.

SCC promises to help its customers develop a "corporate sense of humor."

The application of comedy and improvisation as organizational lubricants isn't unique to SCC -- other companies, such as ImprovEdge, in New York City, take a similar tack. But SCC is the grand old man of the genre, with the kind of brand name that helped Monty Python's John Cleese morph from a guy beating a dead parrot into a successful maker of training videos. SCC's ambitions, too, are grander than most. The company promises to help its customers develop "a corporate sense of humor," which Keefe describes as a loosening of cultural corsets in the name of creativity, communication, and fun, and which translates on the ground into anything that helps dislodge the stick from the organizational posterior. "People in companies have to cope with so many things: mergers and acquisitions, new technologies, communication gaps," says Keefe. "They're desperate for their employers to show a sense of humor, to let them know that everything's not so dire."

Keefe's theory of business humor, which he began to develop while producing industrial films in his twenties, elevates emotion over logic, democracy over authority, and those who do over those who become critics. The SCC staff evangelizes those virtues through the improvisational games, exercises, and sketches that -- together with theory, lecture, and Q&A -- compose a typical workshop. (Workshops are priced according to the number of attendees and start at $2,500, not including transportation and lodging for SCC staff for events outside Chicago.) The improv may require participants to sing show tunes in gibberish, play catch with invisible dead rats, or concoct ads for such products as a necklace that kills people. "What we're trying to do with these people is marry their right brains to their left brains and have both of them be happy," says writer Michael Kuhl. "Because if your right brain atrophies, you start walking in concentric circles."

The company-specific comedy shows command the most exertion and ingenuity from SCC's staff, and the going rate is usually between $5,000 and $7,000. Along with customized fare, they include comic treatment of universal business themes, such as the delinquency of temp workers and the screwball antics of office technology. In one sketch that is part of the company's repertoire, a presenter rattles on obliviously while her PowerPoint slides turn against her, urging the audience to mutiny and ranting nonsensically about teapots and badgers. Up in Keefe's office, Kuhl, who created the sketch, explains its genesis. "I once worked for the HR department in a brokerage firm, and I can tell you it was a soul-crushing experience," says the writer, who like many SCC employees draws inspiration from stints in the corporate world. "But it was educational in terms of learning about the irritations that are true for all companies. PowerPoint presentations. Expert speakers. Travel issues. Conference calls. Meetings. The planning meeting. The preplanning meeting. The planning for the preplanning meeting meeting." He turns to Keefe, who is leafing through some paperwork. "Were you planning on meeting at the preplanning meeting meeting?" the writer inquires.

"I hadn't planned to," replies Keefe, without looking up. "Can we meet on that?"

The measure of a joke's effectiveness is equal to the quality of its writing and delivery multiplied by the familiarity of its subject. Simply put, stuff is funnier when it's about people and places you recognize. To unearth company-specific touch points, SCC's producers conduct multiple interviews with their corporate customers -- sometimes over as long a period as two months -- grilling them on hot-button issues, labyrinthine processes, detested jargon, and company lore. Some of SCC's customers have wonderful ideas about what to include. Others don't. "You'll get people who use a catchphrase themselves, and they just assume everyone else uses it too," says writer Blair Butler. "This one client told us that if we used the phrase 'Great Guy! That's the name!' it would kill. They said everyone in the company would get it and laugh. They wanted us to say it, like, 10 times. It turned out no one in the audience had any idea what we were talking about. At that point, you've got the grave dug, and you're chiseling the headstone."

To attend one of SCC's workshops is to hear the corporate sense of humor explicated. To visit SCC's headquarters is to see humor in the workplace made flesh. Like a college dormitory, the company's offices are inelegantly furnished, casually organized, and deeply marked by the personalities that reside there. A fervent believer in the importance of visual stimulation to creativity, Keefe has nurtured an environment that is attention-deficit-disorder chic, from the videos of the television show Saved by the Bell and various action figures crammed in employees' mail slots, to the never ending chess game (between Keefe and all comers) set up by the watercooler, to the loopy dalmatian piÑata that dangles from the ceiling in the writers' room, to a garish painting in which the ghosts of Second City past seem to cower behind a trio of figures that look like members of the Village People, as rendered by Peter Max. "The queerest painting in the world," reads an inexpertly typed descriptor beside the canvas. "This work is a not-so-subtle blend of colors meant to disturb the viewer in nontraditional ways. The artist sought to explore the triumph over failure by failing himself. Parents are asked to deter children from licking the painting."

On one wall of the writers' room, an enormous hanging -- of the type generally sold out of trailers by the side of the highway -- depicts a burly Viking driving a team of white bears into what one can only assume is a fjord. Butler explains that Keefe discovered it in an educational surplus store. "We're the polar bears, and Joe is the large Arctic lord leading us all into water," she says.

She jests, of course. Yet no one at SCC disputes that it is Keefe's barrel-of-monkeys leadership style that makes it possible for employees to be funny and -- please relish the paradox here -- spontaneous on demand. And that ability is critical, given the company's workload. A staff of around 35 -- writers, directors, producers, performers, and a few support types -- produces 350 shows and 100 workshops every year. "We've put together an entire 90-minute production in 72 hours when we've had to," says Keefe.

"If your right brain atrophies, you start walking in concentric circles."

--SCC writer Michael Kuhl

The monsignor's philosophy is embodied in more than just the physical surroundings. Hours are flexible. Snacks are copious. Socializing is encouraged. Dress is business casual -- if the business in question is a video arcade. Most important, hierarchy is nonexistent. So comfortable with Keefe are his employees -- even relatively new ones -- that they mimic the boss to his face. Staff meetings, which are chaotic to begin with, occasionally devolve into a litany of Keefe impersonations. "Everyone in the office does Joe," says Butler, arching her eyebrows and slicing an edge into her voice. "Now we're going to go into something that we like to call 'the creative process.' "

Kuhl interrupts: "Or he'll make an inappropriate comment and then go" -- he looks around wide-eyed, grinning -- " 'Did I say that out loud?' I swear Joe should have played the Catskills."

Even when Keefe isn't around, the staff finds plenty of fodder for comic workouts, including those subjects too sensitive to treat in customers' shows. For example, employees sometimes indulge in what Kuhl calls "inappropriate talk," in which they shed the mantle of political correctness and "just say, 'Whoo hoo' and go nuts, say anything," the writer explains. "Everyone knows it's just in fun. No one is offended." Then there are the sketch ideas that get tossed around in a kind of exorcism of high spirits before sense and propriety take over. "For Blue Cross and Blue Shield, I was thinking of a bit about strippers with guns," says Butler. "Maybe we could throw in a robot and a pony."

Kuhl grabs a pad and pretends to take notes. "So we've got robots..."

"... ponies, strippers, guns," continues Butler, tenting her fingers. "And then to close, the CEO will sing, 'Just call me angel of the morning...' I think that should convey how the company's new Internet capability is going to transform the way it services its customers."

Kuhl pauses in his mock writing. "I see pudding," he says thoughtfully. "Large vats of pudding."

SCC's own very evident corporate sense of humor benefits hugely from its ability to draw staff from its parent's Chicago shows, touring companies, far-flung alumni, and rigorous training program. Some of SCC's employees -- most of whom are in their midtwenties to midthirties -- see the company as a stepping stone to the Second City's main stage or to careers in writing for and performing in television and film. Others like the regularity of the work -- a rarity in what is, after all, show business -- and the exposure it gives them to the business world, which, as a subject, is a growing staple of comedy.

And there's another incentive to working for the offshoot: two or three times a year, SCC produces mainstream comedy shows created by staff members and performed at small theaters around Chicago. "The writers and performers put a premise together, put the budget together, bring it to me, and we fund them," says Keefe. "It's an artistic expression for them, and it teaches them about business profitability." Indeed, so far all the shows produced in that manner have been profitable, which is not surprising, since they cost less than $15,000 to mount. SCC recoups its investment from the first ticket sales; after that, revenues are split evenly between the company and the individual performers. Three years ago one such production, about a fictive sports bar, enjoyed a brief run as a syndicated television program.

So comfortable with Keefe are his employees that they mimic the boss to his face.

Moving back and forth between the worlds of Tom and Bernadette Peters prevents SCC employees from succumbing to the serious business of business itself. One morning in March, native Israeli Tami Sagher sits in on a presentation-training seminar put on for Web start-up, sharing tricks she uses to control stage fright and helping Keefe run the improv games. That night she is on the Second City main stage before a crowd made giddy by laughter and alcohol, portraying a put-upon math teacher and a transsexual prostitute (not at the same time).

"I've never worked in a regular company, so I'm not going to be the person who shows you how to put together your financial reports," says Sagher, pausing in the hallway outside an office where Bill Murray used to sleep. "But I can show you how to laugh at how you put together your financial reports." Keefe hurries past, white rabbit-like, and Sagher hails him with a sheaf of evaluations completed by the group. "They loved your hair!" she offers enthusiastically, pointing to question number 11 on the form that asks respondents to rate from one to five the instructor's coiffure "overall." "Someone gave you a five plus!"

Keefe snatches the papers and glances quickly through them. "This one only gave me a three," he says, shaking his head in chagrin. "These people have so much to learn."

Leigh Buchanan is a senior editor at Inc.

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