Handbook of Corporate Communication and Public Relations

1222 2 3 HANDBOOK OF 4 CORPORATE COMMUNICATION 5 6 AND PUBLIC RELATIONS 7 8 9 10 1 2 3 4222 A comprehensive addition to existing literature, the Handbook of Corporate Communication and 5 Public Relations provides an excellent overview of corporate communication, clearly positioning 6 the ﬁeld’s most current debates. Synthesizing both multidisciplinary and interdisciplinary 7 approaches, it offers readers the in-depth analysis required to truly understand corporate com- 8 munication, corporate strategy and corporate affairs as well as the relevant public relations 9 issues. Written by academics based in Europe, Asia and North America, the text is well illus- 20 trated with contemporary case studies, drawing out the most pertinent best practice outcomes 1 and theoretically based applications. 2 Its four parts cover national communication; international communication; image, identity 3 and reputation management; and the future for corporate communication theory and practice. 4 With a refreshing new approach to this subject, the authors challenge reductionist views of 5 corporate communication, providing persuasive evidence for the idea that without an organ- 6 izational communication strategy, there is no corporate strategy. 7 The Handbook of Corporate Communication and Public Relations is an essential one-stop refer- 8 ence for all academics, practitioners and students seeking to understand organizational 9 communication management and strategic public relations. 30222 1 Sandra M. Oliver is a corporate communication academic at Thames Valley University, 2 London, where she founded and also directs the MSc Corporate Communication Programme. 3 A consultant research practitioner and former industrial PR, she is founding Editor-in-Chief of 4 Corporate Communication: An International Journal and has written extensively, including Public 5 Relations Strategy (2001) and Corporate Communication: Principles, Techniques and Strategies 6 (1997). 7 8 9 40 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 HANDBOOK OF 4 5 CORPORATE COMMUNICATION 6 7 AND PUBLIC RELATIONS 8 9 10 1 PURE AND APPLIED 2 3 4222 5 6 7 8 9 20 Edited by 1 2 Sandra M. Oliver 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors First published 2004 by Routledge 11 New Fetter Lane, London EC4P 4EE Simultaneously published in the USA and Canada by Routledge 29 West 35th Street, New York, NY 10001 Routledge is an imprint of the Taylor and Francis Group

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 Contents 5 6 7 8 9 10 1 2 3 4222 List of ﬁgures 5 List of tables 6 Notes on contributors 7 Foreword 8 Preface 9 Acknowledgements 20 1 2 PART I: CORPORATE COMMUNICATION AT NATIONAL LEVEL 3 4 1 Diversity programmes in the contemporary corporate environment 5 Don R. Swanson 6 7 2 A best-practice approach to designing a change communication programme 8 Deborah J. Barrett 9 3 Knowledge management for best practice 30222 Stephen A. Roberts 1 2 4 Corporate and government communication: relationships, opportunities 3 and tensions 4 Kevin Moloney 5 6 5 Priorities old and new for UK PR practice 7 Gerald Chan 8 6 Communication similarities and differences in listed and unlisted 9 family enterprises 40 Liam Ó Móráin 1 2 7 Strategic challenges for corporate communicators in public service 3222 J. Paulo Kuteev-Moreira and Gregor J. Eglin

8 Communication audits: building world class communication systems Dennis Tourish and Owen Hargie 9 The Olympic Games: a framework for international public relations Yvonne Harahousou, Chris Kabitsis, Anna Haviara and Nicholas D. Theodorakis 10 Facets of the global corporate brand T. C. Melewar and Chris D. McCann 11 Differing corporate communication practice in successful and unsuccessful companies Colin Coulson-Thomas 12 Communicating with 1.3 billion people in China Ying Fan and Wen-Ling Liu 13 Today’s corporate communication function Michael B. Goodman 14 Assessing integrated corporate communication David Pickton 15 New technology and the changing face of corporate communication Martin Sims

PART III: MANAGING IMAGE, IDENTITY AND REPUTATION

16 Reputation and leadership in a public broadcast company Sandra M. Oliver and Anthony Clive Allen 17 Corporate reputation Philip Kitchen 18 Communicating a continuity plan: the action stations framework Sandra M. Oliver 19 Crisis management in the internet mediated era David Phillips 20 The impact of terrorist attacks on corporate public relations Donald K. Wright 21 Public relations and democracy: historical reﬂections and implications for practice Jacquie L’Etang

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 PART IV: THE FUTURE IS NOW 2 22 Visualizing the message: why semiotics is a way forward 3 Reginald Watts 4 5 23 Methodological issues for corporate communication research 6 Richard J. Varey 7 24 Communication for creative thinking in a corporate context 8 Glenda Jacobs 9 10 25 Language as a corporate asset 1 Krishna S. Dhir 2 26 Arrival of the global village 3 Michael Morley 4222 5 27 Ethics and the corporate communicator 6 Albert S. Atkinson 7 28 The new frontier for public relations 8 Richard R. Dolphin 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 Figures 5 6 7 8 9 10 1 2 3 4222 2.1 Strategic employee communication model 5 2.2 Three-phased communication strategy plan 6 2.3 Sample SCT structure 7 2.4 Scorecard of current employee communication 8 6.1 Munter communication theory 9 6.2 Assessment framework 20 6.3 Ideal structure for CorpCom function model 1 6.4 Organizational chart of a hypothetical company 2 7.1 Internal audiences 3 7.2 A stakeholder environment 4 10.1 Facets of the global corporate brand 5 14.1 The wheel of integrated marketing 6 14.2 Continuum of integrated corporate communication 7 14.3 Integrated corporate communication assessment proﬁle 8 14.4 Completed integrated corporate communication assessment proﬁle 9 15.1 Tomita’s media gap 30222 15.2 The changing face of Coca-Cola 1 18.1 Monitoring the trust factor 2 18.2 Information costs and choices 3 18.3 Likely causes of crises 4 18.4 A crisis impact model 5 18.5 Elements of a business continuity plan 6 18.6 The action stations framework: a co-dependency model 7 18.7 First Interstate: normal organization 8 18.8 First Interstate: emergency organization 9 18.9 Scotiabank’s incident response 40 18.10 Scotiabank’s approach to emergency management 1 18.11 Scenario: phases 1 and 2 2 18.12 Scenario: phases 3 and 4 3222 18.13 Scenario: phase 5

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 19.1 Information ﬂows in an organization 19.2 The ﬂow of information to the outside world 19.3 Cisco 19.4 Microsoft 19.5 Tesco 19.6 McDonald’s 19.7 Crisis management plan 22.1 Toyota 26.1 Trust in institutions, 2003 26.2 Brand evaluator: Europe, 2003 26.3 Brand evaluator: United States, 2003 26.4 Strategic decision making

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 Tables 5 6 7 8 9 10 1 2 3 4222 2.1 Strategic objectives 5 5.1 Which are the topics most important and relevant to PR research today? 6 5.2 Which subjects from the old study should still be included in the new set 7 of research priorities? 8 5.3 Which topics from the new list do you consider to be most important? 9 7.1 Categories of press reports 20 9.1 Los Angeles 1984 1 9.2 Seoul 1988 2 9.3 Barcelona 1992 3 9.4 Atlanta 1996 4 9.5 Sydney 2000 5 12.1 Advertising industry turnover and growth 6 12.2 Advertising expenditure by product category, 2001 7 12.3 Advertising expenditure by medium, 1997 8 12.4 Factors inﬂuencing the new name 9 12.5 Names with potentially negative connotations 30222 12.6 Which is your most used marketing medium? 1 12.7 What kinds of events would you consider sponsoring or hosting? 2 12.8 What events have you sponsored in the past three years? 3 12.9 How did you build an association or link between the sponsored event 4 and your brand/company? 5 12.10 How did you integrate the event sponsorship into your marketing mix 6 or campaign? 7 12.11 What difﬁculties have you experienced in reaching the objectives? 8 12.12 Does event sponsorship offer you an advantage in the following factors 9 compared to traditional advertising? 40 12.13 What is your future strategy for event sponsorship? 1 12.14 What role does event sponsorship play in your integrated marketing mix? 2 12.15 Comments on the future development of event marketing in China 3222 12.16 Advertisement by branded product information

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 13.1 Corporate communication functions 13.2 Meeting the press: some guidelines 15.1 Top 25 US web properties by parent company 15.2 Top 10 UK web properties 17.1 The best corporate reputations in the United States 17.2 Primary industry 17.3 Revenue 17.4 Corporate reputation 18.1 Operational functions of banks 18.2 Differences between routine emergencies and disasters 18.3 International terrorism incidents, 1968–79 18.4 Nine steps to managing BCP performance 18.5 Communication channels 20.1 Responses of senior-level, US PR and corporate communication professionals to the question: ‘Do you agree the events of September 11, 2001, changed how your company communicates?’ 20.2 Responses of senior-level, US PR and corporate communication professionals to the question: ‘Do you agree the events of September 11, 2001, have had any impact on your organization’s public relations and communications function?’ 20.3 Comparing mean scores between responses from October 2001 and March 2002 20.4 Responses of senior-level, US PR and corporate communication professionals to additional questions in March 2002 25.1 Functionality offered by language 25.2 Functionality analysis 26.1 The world’s largest PR ﬁrms 26.2 Industry sector: healthcare 2001 revenues 26.3 Industry sector: technology 2001 revenues 27.1 Ethics by profession 27.2 Business ethics courses

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 Contributors 5 6 7 8 9 10 1 2 3 4222 Anthony Clive Allen is attached to the Corporate Communication Directorate at the Royal Air 5 Force in London, UK. 6 7 Albert Atkinson is an active consultant researcher and involved in the affairs of the Library 8 Board of Trustees and Chamber of Commerce, UK. 9 20 Deborah J. Barrett PhD lectures at Jones Graduate School of Management, Rice University, 1 Texas, USA and directs the MBA communication programme. 2 3 Gerald Chan is Public Affairs and Education Ofﬁcer at the Institute of Public Relations, London, 4 UK and studying for a master’s degree in public relations. 5 6 Colin Coulson-Thomas PhD is author of Transforming the Company (2002, 2nd edn), thirty 7 other books and reports, and is Chairman of ASK Europe plc. 8 9 Krishna S. Dhir PhD is Dean of the Campbell School of Business at Berry College, Georgia, USA; 30222 formerly of CIBA-GEIGY AG in Switzerland and Borg-Warner, USA. 1 2 Richard Dolphin lectures at the Northampton Business School, UK and is author of 3 Fundamentals of Corporate Communication (2000). 4 5 Gregor Eglin PhD lectures in strategic management at University of East London, UK with a 6 particular research interest in public service communication. 7 8 Ying Fan PhD lectures and researches at Lincoln School of Management, UK. 9 40 Michael Goodman PhD lectures at Fairleigh Dickinson University, USA and is founding direc- 1 tor of the Corporate Communication Institute at FDU. 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Yvonne Harahousou, Chris Kabitsis, Anna Haviara and Nicholas D. Theodorakis are academics based at the University of Thrace, Greece, involved with the Organizing Committee for the Olympic Games 2004.

Owen Hargie PhD lectures at the School of Communication, University of Ulster, Ireland and is co-author of Skilled Interpersonal Communication: Research, Theory and Practice (2004).

Glenda Jacobs is a Research Fellow at UNITEC, Auckland, New Zealand, where she also leads computer-mediated communication courses.

Philip Kitchen PhD holds a professorial research chair and lectures at the University of Hull, UK.

Paulo Kuteev-Moreira PhD is Director of Communication for a privately managed public hospital in Portugal and a researcher for a WHO-Europe-afﬁliated Observatory in Health Studies.

Jacquie L’Etang PhD lectures and researches at the University of Stirling, Scotland and is an examiner for the Institute of Public Relations Membership Diploma examinations.

Wen-Ling Liu PhD lectures at Hull University, UK on integrated marketing communication.

Chris McCann is Business Consultant for an energy company in Stockholm, Sweden.

Tengku Melewar PhD lectures at the University of Warwick Business School, UK.

Kevin Moloney PhD lectures at Bournemouth University, UK and is a research specialist in government communication and pressure groups.

Michael Morley is Special Counsel for Edelman Public Relations, New York, USA and author of How to Manage Your Reputation (1998).

Sandra M. Oliver PhD, General Editor, is founding Editor-in-Chief of Corporate Communication: An International Journal; author of Public Relations Strategy (2001) and Corporate Communication: Principles, Techniques and Strategies (1997); and founding director of the international MSc in Corporate Communication programme at Thames Valley University, London, UK.

Liam Ó Móráin MSc is founder chairman of Moran Communication, Ireland with eighteen years consultancy experience of communication and PR management.

David Phillips chaired the UK PR industry Joint Internet Commission and is author of numerous papers including ‘Online Public Relations’ and ‘Managing Reputation in Cyberspace’.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 David Pickton lectures and researches at De Montfort University, UK and is co-author of 2 Integrated Marketing Communication (2001). 3 4 Stephen A. Roberts PhD lectures at Thames Valley University, London, UK and directs the MSc 5 Information Management Programme. 6 7 Martin Sims lectures at St Mary’s College, London, UK and is a former BBC journalist who edits 8 Intermedia, the journal of the International Institute of Communication. 9 10 Don Swanson PhD is Chair of the Communication Department at Monmouth University, USA 1 and former President of the New Jersey Communication Association. 2 3 Dennis Tourish PhD is Professor of Communication at Aberdeen Business School, Scotland with 4222 over 50 publications in communication management. 5 6 Richard Varey PhD is a Marketing Professor at the Waikato Management School, New Zealand, 7 who currently researches in managed communication for sustainable business. 8 Reginald Watts PhD is a consultant and author of four books; formerly CEO of Burson 9 Marstellar and President of the Institute of Public Relations, London, UK. 20 1 Donald Wright PhD is President of the International Public Relations Association and an 2 academic at the University of South Alabama, USA. 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 Foreword 5 6 7 8 9 10 1 2 3 Excellent corporate communication lies at the global market place . . . in a combination of 4222 heart of industry, commerce and govern- interconnected phenomena embracing inter 5 ments’ abilities to build a democratic society, alia, globalization, the transformative impact 6 but this critical strategic role in organizational of technology on organizational life (indeed 7 theory and practice rarely receives the due on the very nature of organizations), success- 8 commitment required for quality assurance in ful e-business models and the changing nature 9 organization life today. of working life’. The new economy, he argues, 20 A previous handbook published in 19971 is ‘far too recent a phenomenon for any con- 1 assembled the cutting edge views and experi- sensus to have emerged yet about what con- 2 ences of leading practitioners of the day with stitutes best practice’ but for corporate 3 some solid opinion pieces that have been communicators and public relations consult- 4 helpful to a wide range of audiences and ants and practitioners worldwide, there is a 5 readers including public relations practition- belief that there is a set of best practices and 6 ers, opinion formers, media managers, adver- that adopting them leads to superior organ- 7 tising executives and others. It was a source of izational performance and competitiveness. 8 information and advice on a vast array of The concept of good practice has to be 9 topics brought together to represent the inter- addressed in accordance with contingency 30222 disciplinary and multidisciplinary nature of theory. No single best practice is universally 1 corporate communication as a core business applicable to all organizations because of dif- 2 discipline for senior executives in large multi- ferences in strategy, culture, management 3 national companies, small-to-medium size style, technology and markets. The challenge 4 enterprises (SMEs) and not-for-proﬁt organ- for operators is the inconsistency between the 5 izations alike. belief in best practice and the notion of corp- 6 Now in what philosophers like to call the orate communication as an intangible asset 7 post-modern era, we see more clearly how limiting resource. It is crucial to match corpor- 8 the new information technologies have ate strategy with corporate communication 9 restructured the whole industry sector. Its policy and practice, but given that corporate 40 impact leads us to challenge what John Milton communication is as the Institute of Public 1 calls ‘conventional economic thinking, Relations states the ears, eyes and voice of the 2 redeﬁning how business is done and impact- organization, the in-house practitioner has 3222 ing to varying degrees every worker in the a special responsibility for the overview of the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors organization as a whole beyond that of the support, assessment of barriers, preparation chief executive officer. He or she is required of action plans, project manage implementa- to advise, counsel, monitor and measure tion and follow up evaluation. All these activ- operations in a reliable and consistent man- ities are basic and familiar to middle and ner beyond the reductionist, functional project managers, management research approaches of corporate accounting or inte- students and PR campaign practitioners. The grated marketing. Indeed he or she also corporate communication industry which accepts the role of boundary spanner in includes public relations agencies and blue monitoring not just relations between organ- chip management consultancies have relied izations and their stakeholders but beyond to heavily on developing the skills and tech- the value-added implications of policies and niques to carry out such activities in an essen- practices within a wider democratic society. tially practical but research-based manner. In 1999, Purcell2 suggested that the concept Now, with the recognition of the growth of of best practice and best fit is limited by ‘the the global knowledge economy ‘the tradi- impossibility of modelling all the contingent tional factors of production – land, labour variables, the difficulty of showing their inter- and capital – pale into insignificance along- connection and the way in which changes in side knowledge’, as Philip Sadler says.6 The one variable have impact on others’. Many corporate communicator is at the helm of management consultants have taken up this this development. It is the corporate com- view and been less concerned with best prac- municator who has to be fully aware of chang- tice and best fit to address more sensitive ing environments, major trends, opportunities processes of organization change so that they or threats to the development or survival of an can ‘avoid being trapped in the logic of rational organization. The management of intellectual choice’. So what we have tried to do with this capital has to be understood but is also has book is to adopt the concept of bundling to be applied through corporate communica- whereby the chapters are interrelated, completion operational strategies for it to be of ment and support one another through the added value to an organization. The pure and medium of quality research rather than mere applied aspects of corporate communication opinion. Sometimes referred to as a configura- as educational and training areas of know- tional mode3 or complementarity, MacDuffie4 ledge and skill are inextricably linked. The states that ‘implicit in the notion of a bundle is future of corporate communication will con- the idea that practices within bundles are inter- tinue to depend on its tactical skills base but it related and internally consistent and that more is beginning to redesign itself as a strong pro- is better with respect to the impact on perform- fessional vocation based on sound research ance, because of the overlapping and mutually methods. In spite of the different names by reinforcing effect of multiple practices’. which practitioners are labelled or defined It is generally accepted that to overcome whether in-house or as external consultants, these barriers to the implementation of corp- ignorance is not bliss. Corporate communica- orate communication strategy a number of tion has moved away from the secular public activities are essential. Michael Armstrong5 relations approaches of the 1970s and 1980s argues that essential activities include: the and moved into new areas of political roles conducting of a rigorous initial analysis, form- and relationships between peoples and their ulation strategy, the gaining of influential economic environments.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Although this book is a generalist one it peting values framework is ‘grounded in para- 2 therefore brings together the pure and the doxical thinking – it forces one to think about 3 applied to further develop the profession the competing tensions and demands that 4 and those in it and all who endeavour to be are placed on [corporate communication] man- 5 a part of it in the future. Most vocational pro- agers in new ways’. 6 grammes provided by today’s university The research presented in this book sup- 7 sector have learned to balance the demands ports what Quinn et al. calls ‘the need to use 8 of further and higher education, training and paradoxical thinking to create both ap- 9 practice albeit with some difficulty due to proaches to the management of opposites’. 10 the demands of the university research assess- The corporate communicator is always at the 1 ment exercise in Britain and increasing gov- cutting edge of ‘informing and transforming 2 ernmental control of universities worldwide. our future leaders’, even though ‘every area is 3 The contributors to this book believe that under siege’ because of the ‘crisis of confi- 4222 the underpinning of specialist areas will lead dence in accounting practices and corporate 5 to a greater self-confidence in the face of pre- fiduciary principles. In the twenty-first cen- 6 vailing cynicism and pessimism about strat- tury, leaders are being challenged like never 7 egic corporate communication at local and before to resolve dilemmas around organisa- 8 global levels. This book supports the multi- tional effectiveness, economic viability and 9 faceted roles that any corporate communica- political and military security’. These chapters 20 tor plays, whether he or she be mentor, are based on real research. They are neither 1 facilitator, monitor, co-ordinator, director, descriptive nor prescriptive but challenge 2 producer, broker or innovator.7 These eight reductionist views of corporate communica- 3 roles represent a competing values framework tion and provide persuasive evidence for the 4 which together establish competency in any notion that no organizational communication 5 management field especially in corporate strategy equals no corporate strategy at all in 6 communication, public relations and public a postmodern, mediated internet era. 7 affairs. Whether the practitioner/consultant is 8 at expert, proficient, competent, advanced Sandra M. Oliver 9 beginner or novice stage of a career, the com- General Editor 30222 1 NOTES 2 3 1 Foster, T. R. V. and Jolly, A. (1997) Corporate and manufacturing performance’, Industrial 4 Communication Handbook, London: Kogan Page. Relations Review, 48(2), 199–221. 5 2 Purcell, J. (1999) ‘Best practice or best fit: 5 Armstrong, M. (2001) A Handbook of Human 6 chimera or cul-de-sac’, Human Resource Manage- Resource Management Practice, 8th edn, London: 7 ment Journal, 9(3), 26–41. Kogan Page, 2, pp. 32–52. 8 3 Delery, J. E. and Doty, H. D. (1996) ‘Modes of 6 Sadler, P. (2001) Management Consultancy: A 9 theorising in strategic human resource manage- Handbook for Best Practice, 2nd edn, London: ment: tests of universality, contingency and Kogan Page, 1, pp. 3–16. 40 configurational performance predictions’, Inter- 7 Quinn, R. E., Faerman, S. R., Thompson, M. P. 1 national Journal of Human Resource Management, and McGrath, M. R. (2003) Becoming a Master 2 6, 656–70. Manager: A Competency Framework, 3rd edn, 3222 4 MacDuffie, J. P. (1995) ‘Human resource bundles Chichester: Wiley.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 Preface 5 6 7 8 9 10 1 2 3 4222 In its 250th anniversary year, the Royal Society of Arts continues its mission to encourage arts, 5 manufactures and commerce. During the next six years, the RSA will focus on ﬁve key chal- 6 lenges framed within a new Manifesto: to encourage enterprise, move towards a zero waste 7 society, foster resilient communities, develop a capable population, and advance global citizen- 8 ship. These themes are going to tax the best hearts and minds in boardrooms worldwide, as 9 well as the communication and public relations profession itself, demanding a higher degree of 20 specialist knowledge and skill than ever before. 1 The publication of this book offers a powerful contribution to the range of projects we have 2 implemented to support the Manifesto, including Visions of a Capable Society, Intellectual 3 Property, Shared Mental Modes, Sustainable Design and Global Citizenship. Principles, tech- 4 niques and strategies come together in this book from lead international researchers, academics 5 and practitioners to help us and the international business community to meet its obligations 6 with the help of the authors’ proven expertise and wise counsel. 7 8 Sir Paul Judge 9 Chairman, The Royal Society for the 30222 Encouragement of Arts, Manufacture and Commerce (RSA) 1 2 3 4 5 6 7 8 9 40 1 2 3222 Acknowledgements

The General Editor is indebted to the following: Rachel Crookes and Francesca Poynter at Routledge; Anna Leatham, Giuliana Taborelli, Mireille Jones, Jenny Johns, Khalda Ahmed and Kay Ahluwalia for their skilled IT support throughout numerous drafts; and those friends, colleagues and organizations who have willingly participated in putting together this scholarly contribution to the corporate communication and PR discipline. The Editor and the publishers are grateful for permission to reproduce copyright material and while every effort has been made to ensure that all owners of copyright material have been notified, apologies are offered to any copyright holders whose rights may have unwittingly been infringed. Should such an instance be identified, we would appreciate receiving relevant information. We will undertake to rectify errors or omissions in future editions of this book. 1222 2 PART I 3 CORPORATE COMMUNICATION 4 AT NATIONAL LEVEL 5 6 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222 1111 CHAPTER 1 2 3 4 Diversity programmes in the contemporary 5 6 corporate environment 7 8 Don R. Swanson 9 10 1 2 3 4111 5 Diversity programmes have become an essential element of the modern corporation 6 because of the varied demographics of organization members, stakeholders and poten- 7 tial clients. But what are the attitudes toward, and the focus of, contemporary corporate 8 diversity programmes? The discussion of this question is addressed through the observa- 9 tions of diversity personnel, middle managers and corporate communication managers 20 who carry responsibility for monitoring diversity programmes. 1 This chapter examines diversity programmes from a number of direct research 2 resources developed and conducted by the author. From focus groups made up of diver- 3 sity personnel, interviews with middle managers and executive management personnel, 4 5 observations of interviews with corporate diversity directors, through to observations 6 from interviews with human resource managers and corporate communicators. The 7 study, and the essence of this chapter, shows the emergence from the observations of 8 corporate personnel of some major corporate communication issues. These issues 9 include the lack of dialogue regarding diversity, the nature of diversity training and 30 performance evaluation, the complexity of diversity issues, the managers’ role, and the 1 move to integration and learning as the perspective to bring about effectiveness in 2 corporate diversity programming. 3 4 5 6 7 A glance around corporate America quickly and that in 2010 white males will represent 8 reveals new and diverse faces and the fact less than 40 per cent of the American work- 9 that successful corporate entities cross many force (Arai, Wanca-Thibault, and Shockley- 40 cultural and international boundaries in the Zalabak, 2001). Corporate diversity pro- 1 conduct of their business. Most estimates of grammes and attitudes toward workplace 2 future employment indicate that 75 per cent diversity have evolved since the 1990s. 3111 of new workers will be other than white males Although this seems to be an age of increasing enlightenment regarding cross-cultural reali- and conducted by the author. Those resources ties, there are numerous instances of concern. include: six focus groups, made up of ten In the later part of the decade of the 1990s diversity personnel in each group, conducted it became clear that diversity is not a buzz- in a business financial services unit of an word. Those corporate managers, in the investment bank; interviews conducted with 1980s and early 1990s, who believed diver- twenty-six middle managers and eight execu- sity management was just another human tive management level personnel in one of the resources management fad were sadly mis- largest and most successful international taken. Diversity management as a concept investment banks; observations from inter- and an aspiration for management has views with corporate diversity directors who ‘become deeply rooted in the US federal have a responsibility to keep diversity firmly on government and has received bipartisan sup- the agenda of corporate policy; and observa- port from both political parties’ (Ivancevich tions from interviews with human resource and Gilbert, 2000: 75). The economic statis- managers and corporate communication man- tics and demographic profile of the potential agers who carry the responsibility for monitor- customers and the new additions to the working diversity programmes. force mandate corporate awareness of the realities of diversity. Workplace 2000, published by the Hudson Institute in 1987, was Study of diversity personnel widely quoted in the 1990s to predict the shifts. But a powerful sense of presumption At a micro level a focus group study of diver- for the status quo workforce still persisted in sity personnel and an interview based study the subconscious of many middle-aged execu- of mid-level managers, from two different tives. It took the reality of market shifts, and units of a large investment banking firm, pro- an increasingly diverse set of job applicants to vide a snapshot of the attitudes and percep- force awareness of the ‘demographic impera- tions of personnel in a white-collar industry tive’ that required corrective action in the that espouses a commitment to diversity form of diversity management programming programming. The units in these studies are (Cox, 1991). Many corporations have found it a part of one of the oldest American invest- difficult to maintain a diversity friendly image ment banking institutions, and it has histori- in the wake of harsh criticism of past abuses. cally been a leader that defined the nature By 1995 The Economist reported that 75 per of that business. As such, the firm conveys cent of the fifty largest US companies had and maintains an image that has developed diversity directors or managers. Consequently over a rich history. The image of being a a macro view of diversity programming indi- leader in the investment banking industry has cates it has become an inherent part of corp- been exceptionally important to the firm. It orate environs. defines itself as a world-class company oper- This discussion examines attitudes toward, ating in the fast-moving, highly competitive and the focus of, contemporary corporate financial services marketplace, and realizes diversity programmes. Managers and their that it must attract, keep and develop the influence on diversity programming are at the very best people. The CEO explains that: ‘We nucleus of this discussion. It develops from a are building for the next generation, not the number of direct research resources developed next transaction. To do this we must be an

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 undisputed employer of choice.’ The firm have an opportunity to discuss these sensitive 2 appears to be committed to developing and issues’. 3 maintaining diversity at every level of the There were no major complaints that could 4 company. be labelled as unique to this corporate unit. 5 The data in this study was gathered over Some participants, who had worked in other 6 a period of three months with the conduct of units of the firm reported that this unit was 7 six one-half-day focus groups. Each focus much more diversity friendly than their previ- 8 group was composed of a group of approxim- ous group. Although this was a long-standing 9 ately ten members of the banking group unit of more than six hundred members, there 10 that provides financial services to businesses. have been no catalytic events in recent 1 The focus group participants were selected memory in the unit that would serve as a flash 2 because they fit into a protected category, i.e. point for concern over diversity. The incidents 3 historically minority status. Consequently this reported by the participants were generally 4222 sample included the minority personnel and not egregious nor widely discussed by co- 5 a cross-section of female personnel and repre- workers. The negative incidents seemed to be 6 sented approximately 10 per cent of the em- considered as isolated incidents and not 7 ployees in this nationwide unit of the bank. representative of the attitudes and behaviour 8 This sample was intended to be inclusive of of the majority of unit personnel. 9 diversity personnel in order to focus on airing Most of the persons in the focus groups 20 all the major issues that concerned these pro- were quite ignorant of what their company 1 tected groups. Personnel were brought to the had done or not done with diversity initia- 2 focus group location from across the United tives. They had queries for information and in 3 States. Two focus groups were conducted in a sense the focus groups became a form of 4 Princeton, New Jersey, and four groups were action research because the participants’ 5 conducted in Chicago. questions were answered and they received 6 The executive in charge of the financial ser- new information on what was happening. 7 vices business unit that the focus groups were Eden and Huxham (1999) point out why 8 drawn from made a point of coming to each action research has become ‘increasingly 9 group and expressed his support for the diver- prominent’ in the study of organizations when 30222 sity management project and this fact-finding they indicate it is: ‘research which broadly, 1 research. Participants were impressed with his results from an involvement by the researcher 2 support. This was a key element to making the with members of an organisation over a 3 focus groups successful. It is clear that visible matter which is of genuine concern to them 4 executive support is an essential element for and in which there is an intent by the organ- 5 success. isation members to take action based on the 6 The participants in the diversity focus intervention’ (p. 272). 7 groups seemed to appreciate the cathartic Developing and conducting the focus 8 experience of talking about a subject that they groups was a prelude to further action 9 had some uncertainty about. Many lacked research. It should be noted that this focus 40 even a basic knowledge of the diversity mis- group process was a catalyst for an evolving 1 sion of their corporation. They were both diversity initiative that included the estab- 2 interested and generally pleased to discuss lishment of a ‘diversity council’ to suggest 3222 this topic. Several said they ‘never expected to and monitor future actions. In this way the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors participants had a sense of outcome from the the principles and behaviours taught in focus group project. the training. Affirmative action was a frequent, but not 5 Managers must be well and extensively particularly comfortable subject in these trained in diversity management. groups. They appreciate the goals of affirma- 6 The managers’ performance review tive action but it can produce a somewhat should include how well they manage uncomfortable paradox. All of the participants diversity. This task of reinforcement and believe that the firm hired them because of maintenance of effective diversity their skill and experience. To these personnel management falls upon the managers and endorsing affirmative action might connote the respective styles that they model for that their hiring may have been the result of everyone else in the group. some preference. Most of these people indi- 7 The firm needs to do a better job of cate that if in a pool of equally qualified can- performance reviews. Managers need to didates there is a minority, at this point in the do a better job of letting you know what history of firm, the minority person should be to do to get promoted. Help us with what selected. Focus group participants em- we need to learn and accomplish so that phatically express the position that ‘no one we perform more effectively. should ever be hired who cannot do the job’. 8 In the interest of trying to promote Discussants often mentioned the fact that diverse people, don’t just promote people traditional methods of recruiting may not because of their diversity status, forgetting reach many persons who could be in a quali- their qualifications. Don’t put someone fied minority pool. It was frequently noted somewhere just to have a minority in that that investment banking is dominated and position. staffed almost completely by white males. 9 Career planning is important to everyone. The dynamic in the groups was stimulating Career counselling and advising is import- because participants were eager to make con- ant and it should be done. This could structive action proposals. The following is a solve some of the problem we have with list of major suggestions made by the focus a high turnover rate. The people we tend group participants. They are included in no to lose will be minorities who have excel- particular order, but represent the major reac- lent opportunities elsewhere. What are tions of the sixty participants: their opportunities here? They need to know. 1 Work to maintain respect, regardless of 10 As this unit grows we need to do more gender, ethnicity, or race. mentoring. It is essential to have more 2 Maintain commitment to diversity and training and mentoring for those who work to increase heterogeneity. want to move up to management. 3 To assume that the whole group has a 11 This unit must deal more effectively with problem is not fair. Don’t try to fix what is the problem of attrition. If we lowered the not broken. Get in with the workforce and attrition rate there would be fewer per- fix the real problems that are there. sonnel problems. 4 Provide meaningful diversity training. This 12 As a matter of course do exit interviews should be a part of the orientation process and listen to them. Learn from the reasons for new employees. Continually reinforce people leave.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 13 Improve recruiting – go beyond putting Study of mid-level managers 2 advertisements in the paper. Be more visi- 3 ble at career fairs. Go to a wider range of The second study that provides a view of the 4 universities to recruit. attitudes and perceptions of personnel in a 5 14 Take time while hiring. Don’t do it too white-collar industry of investment banking is 6 quickly. ‘Emergency hires’ can’t be done based upon a focused set of ninety-minute 7 carefully. Go slow and get somebody interviews with twenty-five mid-level man- 8 really good for the job. Go past the agers in the mutual funds division of the firm. 9 typical criteria for hiring. Only using refer- The sessions focused both on information 10 rals won’t accomplish the diversity goals. gathering and coaching the managers. This 1 Instead of looking at educational back- again was a form of action research because 2 ground, look at their talent. Look cre- the interview provided an opportunity to 3 atively at the past history of candidates’ conduct a constructive dialogue on some 4222 work. Even though I am at a lower level of the issues of concern to the interviewees. 5 let me do some hiring or at least be more The focus of the interviews was on both the 6 involved in the hiring process. process of evaluation and the impact of deal- 7 15 Maintain, embrace and apply more of the ing with a diverse workforce. Topics included 8 quality of work–life policies that the firm discovery of diversity sensitivity, coaching 9 brags about. Don’t offer policies, if man- people through difficult performance eval- 20 agers don’t intend to use them. Walk the uation sessions, working for candour, honesty, 1 talk. openness in performance management 2 16 Establish a diversity council and define sessions, maintaining a climate that is non- 3 what it will do. It’s not going to work to defensive, and the general problems the 4 just talk about diversity. This group should supervisors faced in dealing with those who 5 be very active. 6 reported to them. 7 17 Get individual groups of particular minor- The performance evaluation issues 8 ity categories together for sessions like reported by the managers were as follows: 9 this. Blacks, Asians, women, etc. See if 30222 they have more ideas to share when they 1 Adapting performance appraisals to dif- 1 are only with persons with the same cate- ferent types of people is a challenging 2 gory. If you want to get to the truth, do process. Many are not sure of how their 3 this to get a definite sense of the peer perceptions fit within the context of the 4 groups. cultural background of those who come 5 18 Do a quarterly newsletter that highlights from very different cultures. 6 diversity features, and initiatives. If it is 2 It would be beneficial to receive more 7 put online attach it in an easy to find and feedback regarding the nature of my lead- 8 read manner. Overall we are in a growth ership style. I’m not sure how it fits a 9 mode and we need to be able to get to range of different people. 40 know the new people. 3 Dealing with someone who used to be a 1 19 Report to us. We want to hear the results peer and now I am her/his boss. 2 of what the groups said in these focus 4 Discussing issues that are team issues with 3222 groups. individuals.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 5 Working to define clear and measurable issue for managers. To mid-level managers critical objectives. performance evaluation is where they are 6 How to continue to motivate someone challenged to ‘overlook differences’ and treat who is evaluated as an exceptional per- everyone the same. former. Helping them to see how they can add value. 7 How to motivate people who are in a Directors of diversity programmes dead-end job. 8 Understanding the motivation, or lack Diversity directors from six organizations were thereof, of the new generation of staff. interviewed for their impressions of the status 9 How to sincerely communicate a positive of diversity management programming today. sense of morale to persons who have low It was interesting to note that half of this morale. group were ‘professionals’ in the sense that they had worked with diversity management In this sample group the managers also had in more than two corporations or government concerns about their personal performance entities. The others were moved to this posi- for which they sought discussion and advice: tion in their corporation because of their understanding and sensitivity to the issues. In 1 Finding ways to get better feedback from all cases they were African–American female my boss. or Hispanic, or a combination of these fea- 2 Giving my boss feedback about how tures. Although never directly queried, there he/she provides feedback to me. seemed to be an implicit question: ‘Does it 3 Working on personal impression manage- require a person who is of minority status to ment and knowing how to ‘build your be in this position?’ All would probably assert skills and your personal franchise’. it as an advantage because they talked about 4 Communication/leadership aspects of how they could relate from personal experi- forming a new team. ence to the subtle difficulties that diversity 5 How to reinforce and maintain the com- personnel in their organization were facing. munication things I am doing that are There was a feeling among the diversity effective with my team. directors that legality provided the genesis of 6 How to encourage the culture to open up the department they worked in: ‘We saw a the conversations? Can we motivate by problem, noted the increase in litigation over other than fear? issues of equity and fairness and responded 7 How to approach further personal devel- with this unit. As the tendency increases for opment as a supervisor. employees to sue when they believe they are 8 Dealing with cross-cultural communica- wronged, our unit is considered as a part of tion differences. the remedy.’ They observe however that that 9 Managing meetings. reality is both reassuring, for the continued existence of their unit, and troublesome This set of interviews demonstrates that in because the legal perspective is only a portion addition to concerns about personal and team of the rationale for their programming. One performance, equity and accuracy in the con- director said that: ‘We are trying to do the duct of performance evaluation is a significant right things for the wrong reasons.’ He goes

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 on to explain that legal issues and court orders ment of the new decade ‘everyone must be a 2 need to be addressed; however the real impe- producer’. It is the multiple outcomes of a 3 tus for his unit is the economic reality the person’s labour that become the prime focus 4 corporation must face: ‘There is an entire seg- of evaluation. Rarely is a performance issue 5 ment of the population who are potential ever discussed in terms of its root cause, which 6 clients that we are not reaching. Suddenly could be cultural; rather, it is treated as a 7 management has realized that to ensure the measurement issue. It is the ‘bottom line’ that 8 future of the corporation we need to get inter- counts. As one diversity official said: ‘They 9 ested in diverse customers and employ people have effectively removed the humanity from 10 who look like the new customers.’ Others the equation of performance evaluation and 1 noted that the pool of qualified employees decisions on rifts.’ 2 was becoming increasingly diverse and that Women still substantially feel there is a 3 that demographic pattern will continue to glass ceiling. In one large corporation the 4222 increase. They agreed that diversity manage- diversity director reports that: ‘When we did a 5 ment is an inescapable issue in the twenty- study of the most successful people we noted 6 first-century corporate environment. that the most successful women over the age 7 The diversity directors who were inter- of forty do not have children. On the other 8 viewed in this study often tend to speak in hand it is interesting to note that the most 9 metaphors to describe the true nature of the successful men over forty do have children.’ 20 challenges they see their organizations facing Female executive interviewees repeatedly 1 today in the American workplace. They indicate that they have to adapt to the corp- 2 believe that persons not from the dominant orate leadership style in order to be success- 3 culture, usually referred to as diversity person- ful. They need to ‘be as hard-nosed as a 4 nel, ‘experience a longer runway to success’. comparable man’. Lower-level women in the 5 This connotes the reality for most of these per- organizations resent this tendency and point 6 sons: that they must adapt to the dominant out that ‘the most macho executives are the 7 culture that is thoroughly ingrained in the women who have had to be ruthless’ to get to 8 corporate culture. Often learning ‘the way we the top. ‘She is tougher in her expectations of 9 do business around here’ is a necessary com- me then she is of any of the men under her.’ 30222 ponent for success. Paradoxically the diverse Typically when a female executive is con- 1 background, along with a divergent perspec- fronted with this impression the response is 2 tive, that encouraged the hiring of a minority incredulity: ‘Of course I’ve been tough and 3 category member, may be a disadvantage to enforced high standards. It is the only way to 4 that new member in functioning with the make a mark as a leader in this corporate cul- 5 existing set of dominant culture co-workers. ture. I don’t see a distinction between male 6 Odious overt expressions of bias are rare and female leaders in that regard.’ However 7 and are the easiest situations to handle the same female executives will admit in 8 because most organizations currently practise private coaching sessions that over the years 9 a zero-tolerance policy for such issues. Most they learned to modify their interaction 40 individual problems that employees have in patterns to fit those of the males in the board- 1 the workplace are not considered as issues room. In the environment of pressured deci- 2 related to diversity. They are considered to be sion making, female executives will admit that 3222 performance issues. In the pressured environ- their interaction patterns must fit ‘playing the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors game’ according to the men’s rules, while The directors, who have been in the being vigilant ‘not to be seen as shrill or overly minority position themselves, are aware that emotional’. ‘minorities are often in less political positions’. Are diversity units as proactive as they need This provocative observation implies that in to be? The diversity directors would respond some cases diverse executives are isolated to with a resounding ‘no way’. Do they know ‘safe havens’ where they are impacted less by how to approach the entrenched issues? the shifting winds of corporate change. A case Some might say they are making progress. in point is the diversity executive who feels he One feature that is required of persons in a is safe from rifts because he is a high-profile diversity management position is that they minority within the diversity management must have patience. They recognize they are programme. working for cultural change and it is going to Some diversity managers believe that occur over a significant period of time. They ‘informal networks work in adverse ways for relate the fable of the tortoise and the hare. the minority population’. The familiar exam- Small improvements will lead to eventual ple is: ‘If I don’t play or talk golf, I’m at a real cultural change within the corporation. They disadvantage.’ There is a strong sense that the believe in diversity training, but are guarded quality and nature of organizational mem- regarding its quality and impact. As one said: bers’ relationships is a hidden element that ‘I haven’t met a soul in the firm who liked the bears a great deal of weight during perform- diversity training we have.’ They doubt that ance evaluation and decisions on rifts and the short segment of time devoted to diversity promotions. The questions can be as basic as: training enables the opportunity to make a does the minority person have enough under- lasting impact. They would rather do very standing of the majority person’s value set limited training than poor training that only and interests to carry on a satisfying conversa- creates and reinforces stereotypes. They recognize that the most important component tion; does the majority person have enough of the diversity training process is the mid- sensitivity to recognize that not everyone level managers’ support and reinforcement of shares his/her value set and interests? it. ‘The persons who need real hard core Diversity directors realize that because they coaching on diversity management are the are expected to be cultural change agents they middle managers who either don’t recognize should be accountable for objectives that are the need, or because of business pressures, long term and very difficult to measure. won’t take the time for it. They think sending However corporate leadership prefers consist- new employees to a day-long diversity orien- ent quantification of results. Diversity man- tation will solve the problem.’ However as the agers dislike quotas just as much as the focus groups testified, and reported previ- ideological critic of affirmative action. They ously, the managers are on the precipice recognize that the quality of work life and regarding diversity fairness perceptions and satisfaction with peer relationships may be have the greatest need to be informed, sensi- measured by retention rates, but its impact on tized, and coached. None of the diversity productivity and quality decision making is directors feel that their diversity programmes very difficult to measure. Diversity directors are approaching adequate cultural change suffer from the corporate headquarters habit programming with mid-level managers. of measuring results over a brief time span yet

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 they toil to make systemic changes that will of organizing and focusing some of the par- 2 take years. As a result, several of these direc- ticipants’ consideration of diversity. In brief 3 tors indicate that, for the health of their they are the following: 4 career, they have to think of this as a short- A starting point is to employ one of the 5 term one-to-three-year position: ‘Getting back most widely applied value dimensions that 6 to an operational role where I can demon- explains cultural distinctions: individualism– 7 strate my ability to get results will be crucial to collectivism (Fiske, 1991; Gudykunst and Ting- 8 my career.’ Toomey, 1988; Hofstede, 1980, 1991; 9 The goal of all of the diversity directors Schwartz and Bilsky, 1990; Triandis, 1995). In 10 was, as one indicated: ‘weave diversity into the instance of many managers, this value 1 the everyday operation of the firm’. They dimension is highly applicable. It enables a 2 had no illusions about the difﬁculty of this general view of how and why the subordi- 3 task. They knew they had to come up with nates the leader supervises may hold a differ- 4222 tactical methods of accomplishing their mis- ent worldview and mindset from that of the 5 sion of inclusiveness. This is a term that is dominant culture manager. Ting-Toomey’s 6 embraced more forcefully than previous terms (1999) discussion of the distinction between 7 such as tolerance and diversity, which can individualism and collectivism encapsulates 8 carry negative connotations. The new reality the sort of concepts that can be applied: 9 is that since the workplace will be more 20 inclusive of a wider variety of employees and Basically, individualism refers to the broad 1 customers an ‘inclusive growth strategy’ is value tendencies of a culture in emphasis- 2 appropriate. ing the importance of individual identity 3 over group identity, individual rights over 4 group rights, and individual needs over 5 Dimensions of difference group needs. Individualism promotes self- 6 efﬁciency, individual responsibilities, and 7 It is important to note at this point in the dis- personal autonomy. In contrast, collectivism 8 cussion that the persons in the studies rarely refers to the broad value tendencies of a 9 placed any theoretic frame on the diversity culture in emphasising the importance 30222 issues they discuss. In interviews they can of the ‘we’ identity oriented needs over 1 quickly embrace the interviewer’s conceptual individual wants and desires. Collectivism 2 frames to explain what they perceive and promotes relational interdependence, in- 3 have experienced, but there is an obvious group harmony, and in-group collaborative 4 dearth of their own application of such frames spirit. 5 to their daily activities. (p 67) 6 Previous work by the author has focused on 7 employing programme objectives labelled Applying three basic concepts, as awareness 8 ‘dimensions of difference’ (Swanson, 2001). objectives, produces a framework for produc- 9 In the main, these can be construed as com- tive discussion. The concepts are worldview, 40 munication variables. These provide a base- mindset and intercultural communication com- 1 line for the action research discussed here. The petence. Those concepts can be faulted for 2 dimensions provide a general way to bring being expansive, yet they are valuable 3222 new concepts into interviews with the goal because they broadly encompass elements

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors that assist the leader in perceiving why and attitude formed by experience, education, how significant differences exist. prejudice, etc.’ (p. 862). Fisher (1988) select- The first objective is to examine and under- ed this term to headline his approach to stand that a person’s worldview is a strong improving cross-cultural relations because: determinant of their communication patterns. ‘Diagnosing mindsets as they relate to Worldview is a broad concept that generalises immediate problems is a more manageable how a cultural group orients to the world objective’ (p. 2). People are predisposed to (Aldefer and Smith, 1982). ‘Worldview refers perceive an issue that is at hand in a particular to the philosophical ideas of being’ (Jandt, way because of a pattern of attitudes that 1995: 214). Typically those orienting factors has developed from their experience and may be most of the following: How human development of social reality. That powerful nature is viewed as either good or evil. Are attitude set may emanate from personal humans considered to be in control of their history that is influenced by culture. For exam- destiny, or do the forces of nature determine ple assuming that a person values and destiny? How do humans differ from animals employs highly rational decision making over and what role does spiritual belief play in life? personal relationships and loyalty, may not be Managers are not surprised by the Sapir– an appropriate assumption. Many managers Whorf hypothesis that indicates the world- are unaware of the mindsets of their sub- view of a particular speech community is ordinates nor of their own personal mindset reflected in the linguistic patterns they em- as it relates to other cultures. ploy. They have repeatedly been told that The third objective is to consider skills of learning another language is vitally important. intercultural communication competence. This But the sense that different language groups multifaceted concept conveys a pragmatic have different cultural patterns is only a start- sense that an individual’s personal coming point for an initial awareness. As Jay munication characteristics will be assessed by (1968) argues: ‘Bilingualism is not in itself the those they interact with in diverse settings. answer to cultural understanding among Interpersonal communication scholars (Lustig people. An indispensable asset, it must be for- and Koester, 1999; Wiseman and Koester, tified by the strongest possible sensitivity 1993; Spitzburg and Cupach, 1984) agree education. With knowledge of the language and focus on the concept that competent per- must exist a similar knowledge of the social, sons must practise effective interaction skills, religious and economic attitudes of a people’ but they must also interact appropriately with (pp. 85–6). The context of an individual’s life the people and the cultural environment, is provided by a rich array of cultural factors while striving to attain the goals of the com- that shape the individual perception of the munication. The injection of the concept of world. ‘Context is a powerful organizer of competence into the awareness of the learner experience’ (Seelye, 1993: 8). seems to indicate that some behavioural ele- The second objective is to examine the ments of appropriate adaptation can be managers’ mindset. Although the term ‘mind- learned along with effective behaviours. set’ does not seem to be very precise from a The skill of appropriate interpersonal and social science perspective, it does have a intercultural sensitivity and adaptation is what common sense understanding typified by all managers should be expected to do. One Webster’s (1988) definition: ‘a fixed mental of the key elements that some managers

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 reported was ‘knowing when to talk and group need to focus on the skills of listening 2 when to listen’. In his discussion of construct- carefully and ‘listening together’, rather than 3 ing life through language, Shotter recognizes individually. If members can ‘suspend cer- 4 this reality: ‘In some contexts – in offices, tainty’ and begin to externalize thought, even 5 businesses, bureaucracies, educational estab- to the point of saying the unusual or unpopu- 6 lishments, etc. – knowing the order of talk lar, they have helped to open the dialogue. 7 required is a part of one’s social competence Second, in order to mobilise members’ ‘pre- 8 as an adult’ (1993: 4). Kikoski and Kikoski dictive intuition’ the action patterns within the 9 (1999) designate the ‘order of talk’ as a group must be considered. Can they balance 10 shared common necessity for colleagues in a advocacy and inquiry? Can the group ‘map 1 workplace to have ‘social competence’. the systems’ of their interaction, i.e., develop 2 Discussion with this research sample of a coherent representation of the overall 3 managers, perhaps typical of any discussion of system of issues that are faced? Third, the 4222 intercultural communication competence, ‘architecture of the invisible’ needs to be 5 seems to be enhanced with greater clarity by examined. This requires some boundary set- 6 the awareness that worldview and mindset ting for the group’s interaction and a sense of 7 are powerful synonymous determinants of the field or process environment of the dis- 8 communication behaviour. Thus these two course. When the nature of the dialogue field 9 concepts coupled with the aspiration of inter- is understood, then convening dialogue is 20 cultural communication competence are based on the nature of the process environ- 1 valuable organizing concepts for training. ment and sensitivity to the ecology of the 2 They also function as a useful organizing tool group. Other members of the group implicitly 3 for research interviews. realize that ‘the way we talk impacts the way 4 we think’, so there is a consistent concern with 5 how each individual talks. The ultimate result 6 Discussion will be ‘ignorance management’. Those things 7 that are not known, that participants are 8 Most managers lack familiarity with termin- unaware of in specific terms, or deliberately 9 ology that enables in-depth dialogue regarding withheld from the group, can become import- 30222 diversity. Managers interviewed in this study ant input into the synergy of the group. It is 1 indicated that corporate organization mem- when the third phase of dialogue occurs, that 2 bers rarely approach a quality of discussion of includes getting beyond not knowing what is 3 diversity issues that can be labelled as dia- not known about each others’ perspectives, 4 logue. Theorists and practitioners working to that the type of interaction and understanding 5 help groups accomplish dialogue indicate that occur that can lead to building an inclusive 6 it is quite difficult to achieve (Issacs, 1999; culture. ‘Dialogue is about evoking insight, 7 Bohm, 1992; Senge, 1991). To illustrate that which is a way of reordering our knowledge – 8 difficulty it is necessary to examine how the particularly the taken for granted assumptions 9 process of dialogue may be defined and oper- that people bring to the table’ (Issacs, 1999: 40 ationalized. The capacity for conducting dia- 45). Diversity directors in particular believe 1 logue includes three levels of interaction that important progress can be made when 2 (Isaacs, 1999). First, in order to ‘build capac- members of their organizations are able to 3222 ity for new behaviour’ members of a work have dialogue on diversity issues. Values and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors interaction patterns are slow to evolve as take blame for the past makes the ultimate D’Amica and D’Amica (1997) suggest in their goal – greater unity – impossible’ (Rasmussen, futurist anticipation of work attitudes in the 1996: 5). Typical training approaches, such as twenty-first century: ‘Breaking through the those applied in most organizations consid- inertia of entrenched patterns in both individ- ered in this study, are very brief. A half-day or ual behaviour and organisational systems has full-day training session raises some aware- shown itself to be much more difficult and ness and provides some rationale for change, long-term than expected’ (p. 6). but rarely begins to work with the broader Diversity training has evolved through some issues of diverse worldviews from diverse rough waters. In 1988 diversity was not one cultures and the resultant mindsets that of the top forty training topics reported by guide key elements of workplace behaviour. companies in a Society for Human Resource Thomas and Ely (1996) encapsulate this sort Management study (Rynes and Rosen, 1994). of awareness: By 1998 a study by the same organization reported that 75 per cent of the Fortune 500 Numerous and varied initiatives to increase firms and 36 per cent of companies of all sizes diversity in corporate America have been had some sort of diversity programme in under way for more than two decades. process (Allen and Montgomery, 2001). In the Rarely however, have those efforts spurred 1990s diversity became a hot topic and Loden leaps in organizational effectiveness. (1996) reported: Instead, many attempts to increase diversity in the workplace have backfired, some- Today, the myriad training programmes, times even heightening tensions among planning councils, diversity audits, consult- employees and hindering a company’s ants, and organisation initiatives that pur- performance. It is our belief that there is a port to be changing corporate cultures distinct way to unleash the powerful bene- often seem to be focused more on generat- fits of a diverse workforce. Although these ing activity than results. While awareness benefits include increased profitability, and understanding have become a staple they go beyond financial measures to of every organisation’s diversity strategy, encompass learning, creativity, flexibility, many programmes to increase awareness organizational and individual growth, and appear to be generating more heat but not the ability of a company to adjust rapidly more light. and successfully to market changes. The (p. viii) desired transformation however, requires a fundamental change in the attitudes and The heat often comes in the form of a white behaviors of an organization’s leadership. male backlash by those who react to training (pp. 79–80) programmes as ineffective. For example one respondent in this study indicated that: ‘White Performance evaluation is a focus point for men are blamed for all the problems. I resent diversity management programmes. Most white male bashing. We built and maintain performance appraisal systems strive to make this company.’ This is a major obstacle that legally defensible appraisals and this means diversity programmes must overcome. ‘In that issues objectively covered by law be- effect, positioning diversity so one group must come the focus (Smither, 1998). However, the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 perception of the process by those who are include the recommendation that appraisals 2 affected by it is key. be specifically job related, based on behav- 3 Uncertainty regarding the impact of diver- iour rather than individual traits, relate to spe- 4 sity policy on evaluation of personnel takes cific features not holistic assessments, and 5 various forms. Minority personnel consistently should be something over which the subject 6 are alert to any cues that they are not being of the evaluation has control (Barrett and 7 evaluated fairly in a manner consistent with Kernan, 1987; Beck-Dudley and McEnvoy, 8 the evaluation of personnel from the domi- 1991; Bernardine, Kane, Ross, Spina and 9 nant culture. The majority culture personnel Johnson, 1995; Martin and Bartol, 1991; 10 sometimes feel that they are being evaluated Veglahn, 1993). The literature also includes 1 more harshly or ‘held to a higher standard’ the ubiquitous communication expectation 2 than those protected by affirmative action that the appraisal should be stated in descrip- 3 programmes. This is particularly true of white tive/objective terms as opposed to subjec- 4222 male middle-level managers. This focuses tive/evaluative terms and that the appraisal 5 attention upon the review process. must be communicated clearly to the person 6 Supervisors, who conduct periodic reviews, being rated. Theoretically uncertainty reduc- 7 are uncomfortable with the review process tion focuses on self-awareness and knowledge 8 when it applies to someone from another cul- of others (Berger and Bradac, 1982). When 9 ture. It is particularly true of white male super- the members are from divergent cultures the 20 visors who say they must strive to be relationship strategies to reduce uncertainty 1 ‘politically correct’ in all of their statements. may be quite different (Gudykunst, 1988). 2 Some indicate that in the effort to ‘bend over Diversity is more complex than the often 3 backwards to be fair, I am probably sugar unspoken, but underlying, assumption about 4 coating what I say’. ‘I know I have to docu- diversity that it breeds conflict which can 5 ment any problems; my expert reaction to an impede work performance and reduce pro- 6 employee’s sub-par performance is not ductivity. This common perception is at 7 enough in this environment. I am sometimes odds with group theory, and the concept of 8 uncertain of precisely how to proceed.’ democratic decision making, that promotes 9 Diversity personnel and mid-level man- the clash of expressed ideas as an effective 30222 agers desire greater certainty regarding method to work for answers to problems. The 1 how others are monitoring them. Most of underlying worldview and mindset of many 2 the literature on performance appraisal workers from collectivist cultures, is alien to 3 recognizes the essential element of reducing the concept of expressed clash being valued in 4 uncertainty in the process. However, that task relationships. The cultural values of an 5 recognition is in the context of legality and individual may well override the influence of 6 observable behaviour and does not generally their education and organizational environ- 7 include the impact of various cultures on ment. For example if a team member places a 8 mindsets, perceptions, and its consequent high value on harmony, even if she possesses 9 behaviour. Specific issues of cultural differ- informational and worldview diversity, she 40 ences are usually neglected. The US legal may not readily contribute to the group 1 requirements drive the process so that recom- debate. 2 mendations for legally sound appraisals Diversity is more complex than the easily 3222 generally set appraisal criteria. They tend to observable distinctions of race, gender, age

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors and physical ability. As the concept of diver- the third perspective has been further defined sity evolves to fit the contemporary workplace as the ‘integration-and-learning’ perspective where organizations have flattened struc- that enables dialogue on diversity issues to tures and moved to new team and work- occur (Ely and Thomas, 2001). group forms designed to increase synchronous From the manager’s vantage point, is the communication, more complex categories of goal of the diversity programme to enforce diversity are the focus of research. For exam- law and expectations and support incremental ple Jehn, Northcraft and Neale (1999) did a improvements? Or is the goal to develop and field study of ninety-two workgroups applying maintain a systemic programme that has a three types of workplace diversity (social dramatic impact on the corporate culture? It is category diversity, value diversity and in- evident from the reactions of interviewees in formational diversity). They found it appropri- this study that these are neither dichotomous ate to question the typical hypothesis, taught nor mutually exclusive goals. Whatever the as a basic concept on group dynamics, that mission of the diversity unit is, high-level heterogeneity in groups leads to better group executives must be involved and champion performance, while homogeneity leads to the programme. ‘Top management support better group process. However, the reality is for diversity is certainly critical. Management more complex. Their field study discovered needs to begin the process of unfreezing the that social category diversity could be medi- current culture by changing the system within ated by task type and task interdependence which it operates’ (Allen and Montgomery, and that value diversity could be the most fre- 2001: 154). quent impediment to group performance. Consequently, being alert to the impact of diverse value sets, reflected by worldview and Implications mindset, is a key challenge to those who wish to mobilize all of the human assets in a given This review of corporate members’ percep- decision-making setting. tions raises a variety of concepts that in their Contemporary theorists have described application must be context dependent. strategic stages of the development of divers- ‘Organizational leaders also need to examine ity programmes. Allen and Montgomery their internal and external environments to (2001) define the stages simply as: ‘unfreez- adopt an approach to implementation that ing’ the forces resisting change; ‘moving’ to matches their particular context or with a con- cultural change; ‘refreezing’, or institutionaliz- text they believe will emerge’ (Dass and ing the change; and the ‘competitive advan- Parker, 1999: 78). There is no single best set of tage’ that results. In 1996 Thomas and Ely concepts or way of dealing with diversity defined three paradigms to explain the evolu- management. Each organization inheres its tion of a diversity programme. Initially, the own unique demographic features. ‘discrimination and fairness paradigm’ must In any effort to understand the attitude be satisfied. Second, the ‘access and legiti- toward diversity programmes that exists in macy paradigm’ must be put in place, and the contemporary corporate environment it reinforced. Third, the programme must strive seems that the appropriate focus is upon for ‘the emerging paradigm’ that connects executives and their influence on the sort of diversity to work perspectives. Subsequently diversity programming selected to fit their

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 organization. Effective approaches to diversity because of the reality of the varied demo- 2 management are strategic and focused on graphics of organization members, stake- 3 goals that are achievable. holders and potential clients. However, most 4 The key to the evolution of a diversity corporate diversity directors are not satisfied 5 programme to an ‘integration and learning’ with the progress made by their own diversity 6 perspective, which produces cultural change, programme. Diversity personnel feel that 7 is the ability to effectively talk through the managers must develop greater sensitivity to 8 dimensions of difference in the organization. how their diversity personnel are evaluated 9 An organization that develops the ability to and led. Many organization members are 10 discuss diversity in a manner that approaches ignorant of both the nature of the programme 1 dialogue, will also accomplish better diversity in their corporation and the dimensions of 2 training and performance evaluation. difference that have an impact on members’ 3 From the perspective of the corporate com- behaviour. Consequently, there is a challenge 4222 munication professional the existence of a to find ways of developing a mature under- 5 valued and effective diversity programme standing of diversity within the corporate 6 is a significant element to be communicated setting. Concepts such as individualism– 7 to corporate stakeholders. In order to reduce collectivism, worldview, and mindset can be 8 uncertainty for organizational stakeholders, employed to provide a basic conceptualiza- 9 the programme rationale must be clearly tion of difference in the attempt to improve 20 explained and reinforced. A cohesive plan and intercultural communication competence in 1 programme is essential to anticipate and the organization. The promotion of true 2 answer the objections that arise from internal dialogue regarding diversity differences, the 3 backlash, stockholder alarm, and internal existence of substantive diversity training, 4 resistance to the allocation of resources to and application of diversity concepts in the 5 diversity programming. In both the planning conduct of performance evaluation are essen- 6 and the operationalization of the diversity tial elements of an effective diversity pro- 7 programme a sense of high aspirations and gramme. Corporations have made progress in 8 transparency should be evident. addressing the basic programme role of work- 9 ing to eliminate discrimination and promote 30222 fairness. The second role of ensuring ‘access 1 Summary and legitimacy’ is also largely in place. But 2 there is a need to move to integration and 3 Diversity programmes have become an learning perspectives that will enable mean- 4 expected element in the modern corporation ingful dialogue on diversity issues to occur. 5 6 7 8 REFERENCES 9 40 Aldefer, C. and Smith, K. (1982) ‘Studying intergroup ing diversity’, Organisational Dynamics, 30, relations embedded in organizations’, Adminis- 149–61. 1 trative Science Quarterly 27, 35–65. Arai, M., Wanca-Thibault, M. and Schockley-Zalabak, 2 Allen, R. and Montgomery, K. (2001) ‘Applying an P. (2001) ‘Communication theory and training 3222 organizational development approach to creat- approaches for multiculturally diverse

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Practice of the Learning Organisation, New York: Thomas, D. A. and Ely, R. J. (1996) ‘Making differ- 2 Currency. ences matter: a new paradigm for managing 3 Shotter, J. (1993) Conversational Realities: Constructing diversity’, Harvard Business Review, 68, 107–16. Life through Language, London: Sage. Ting-Toomey, S. (1999) Communication across Cultures. 4 Smither, J. (ed.) (1998) Performance Appraisal: State of New York: Guilford Press. 5 the Art in Practice, San Francisco: Jossey-Bass. Triandis, H. (1995) Individualism and Collectivism, 6 Spitzburg, B. H. and Cupach, W. R. (1984) Inter- Boulder, CO: Westview Press. 7 personal Communication Competence, Beverly Veglahn, P. (1993) ‘Key issues in performance 8 Hills, CA: Sage. appraisal challenges: evidence from court and 9 Swanson, D. (2001) ‘Corporate culture and cross-cul- arbitration decisions’, Labor Law Journal, October, tural communication adjustment of American 596–606. 10 general managers leading in the transitional Webster’s New World Dictionary (1988) 3rd college 1 business society of Guam’, in A. Leung, S. Clegg, edn, Cleveland: Webster’s New World. 2 J. Hollows, V. Luk and S. Porras (eds), Proceedings Wiseman, R. L. and Koester, J. (eds) (1993) Inter- 3 of the Asian Pacific Researchers in Organisation cultural Communication Competence, Newbury 4222 Studies: Organisation Theory in Transition: Park, CA: Sage. 5 Transitional Societies; Transitional Theories, Hong Kong: APROS. 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Deborah J. Barrett

In today’s business climate it is arguable that however paradoxically it may sound the only true constant is ‘change’. The focus of this chapter is change communication, an essential companion to any effective change management programme. At the heart of any successful change communication programme is effective employee communication, for without effective employee communication any change programme will fail. This chapter illustrates an approach to change communication by using a best-practice model for employee communication called the Strategic Employee Communication Model.

The importance of change Nothing happens in an organization without communication communication. As Eccles and Nohria say in Beyond the Hype: Discovering the Essence Change is difﬁcult, and organizational change of Management, ‘Without the right words, is particularly challenging, thus the huge used in the right way, it is unlikely that the amount of research on managing organiza- right actions will ever occur . . . Without words tional change, usually called ‘change manage- we have no way of expressing strategic con- ment’. What is change management? Some cepts, structural forms, or designs for perform- might say that it is an oxymoron since change ance measurement systems. In the end, there is too unpredictable and chaotic to control is no separating action and rhetoric’ (1992). or manage. However, good managers must Thus, without effective employee communi- attempt to manage it. Change management cation and a rigid approach to communication is the executive skill or art of leading or during major change, a change programme supervising the people involved in the trans- has little chance to succeed. formation of or in an organization. People Although much research exists on change are the heart of change management, and management, few of the articles or books communication is at the heart of people. give adequate attention to the change com-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 munication that accompanies any good most of the other steps. For instance, how 2 change management programme; however, at could a manager create a ‘sense of urgency’ 3 least communication does appear as one com- without communicating messages that inspire 4 ponent necessary for a change programme to the necessity to act? How can managers cre- 5 succeed in most cases. ate coalitions, without convincing people 6 For instance, in Kotter’s often cited (1995) (through words) to follow them? How can 7 approach to successful organizational trans- managers institutionalize new approaches, 8 formations (‘Leading change: why transforma- without instructing people in expected 9 tion efforts fail’), communication is listed as actions? And, of course, we could go on, but 10 the fourth of his eight steps: these few examples demonstrate how com- 1 munication is interwoven in all aspects of a 2 1 establishing a sense of urgency; change programme. Obviously, without effec- 3 2 forming a powerful guiding coalition; tive employee communication, change is 4222 3 creating a vision; impossible and change management fails. 5 4 communicating the vision; In ‘Leading change: why transformation 6 5 empowering others to act on the vision; efforts fail’, Kotter lists ‘under-communica- 7 6 planning for and creating short-term wins; tion’ as one of the major reasons change 8 7 consolidating improvements and produc- efforts do not succeed. As he says, ‘Trans- 9 ing still more change; formation is impossible unless hundreds or 20 8 institutionalizing the new approaches. thousands of people are willing to help, often 1 to the point of making short-term sacrifices. 2 Another frequently cited approach to change Employees will not make sacrifices, even if 3 management is the ten commandments of they are unhappy with the status quo, unless 4 executing change found in Kanter, Stein and they believe that useful change is possible. 5 Jick’s The Challenge of Organisational Change Without credible communication, and a lot of 6 (1992): it, the hearts and minds of the troops are 7 never captured’ (Kotter, 1995). Therefore, 8 1 analyse the organization and its need for companies need to apply the same analytical 9 change; energy and rigour to employee communica- 30222 2 create a shared vision and common direction and the design of their change communi- 1 tion; cation plan that they give to the financial and 2 3 separate from the past; operational components of any change pro- 3 4 create a sense of urgency; gramme. 4 5 support a strong leader role; 5 6 line up political sponsorship; 6 7 craft an implementation plan; The strategic positioning of 7 8 develop enabling structures; employee communication 8 9 communicate, involve people, be honest; 9 10 reinforce and institutionalize change. Employee communication must play a strat- 40 egic role in an organization to work effectively. 1 In both of these examples, although the That strategic role means that communica- 2 word ‘communicate’ appears in only one tion must be integrated into the company’s 3222 step, the role of communication is explicit in strategy and recognized for its strategic

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors implications and effects. Many managers see 5 align employees behind the company’s employee communication as a ‘black box’. strategic and overall performance im- Communication is either everything in the provement goals. organization (vision, strategy, business planning, management meetings, information The strategic employee communication model flow, knowledge management, etc.) or it is and change communication approach are nothing more than publications intended to designed to help management accomplish keep the communication staff busy and the these goals. employees informed of the company news. Many managers see communication as simply process, or the way to get information to The strategic employee people, not as content, the meaningful mes- communication model and best sages delivered by the process. To be effective, practices employee communication must be both process and content, which positions com- The strategic employee communication model munication on more of a strategic level within (Figure 2.1) helps clarify the strategic role an organization. communication plays in the day-to-day suc- Effective employee communication must cess of any company as well as during major be fully integrated into all aspects of a com- change and can help overcome the ‘every- pany’s business. It is integral to the strategy thing’ and the ‘publication-limited’ percep- as well as essential to communication of that tions of communication. The model and strategy. Effective employee communication its components emerged from research into informs and educates employees at all levels several Fortune 500 companies to find out in the company’s strategy, and it also moti- what really works when it comes to employee vates and positions employees to support communication.1 While no company exempli- the strategy and the performance goals. fies each best practice exactly, the better com- During change, communication becomes panies demonstrate many of the best-practice even more linked to the strategic success. definitions. In a change programme, the For effective employee communication dur- model and the best-practice definitions can ing major change, the change communica- serve as benchmarks against which to meas- tion must at a minimum accomplish the ure a company’s employee communication following: strengths and weaknesses as well as a model of effective change communications. 1 ensure clear and consistent messages to The model captures all of the major com- educate employees in the company ponents of employee communication, linking vision, strategic goals, and what the them to each other and to the company’s change means to them; strategy and operations. Thus, it works analyt- 2 motivate employee support for the com- ically to break employee communication pany’s new direction; down into manageable, recognizable parts; 3 encourage higher performance and dis- at the same time, it shows how intertwined cretionary effort; and interdependent each part is when em- 4 limit misunderstandings and rumours that ployee communication is positioned strategic- may damage productivity; and finally, ally as it must be to facilitate change. The

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 Strategic objectives 3 4 5 Supportive 6 management 7 Targeted Ongoing Well-positioned 8 messages assessment staff 9 10 Effective media/ forums 1 2 3 Figure 2.1 Integrated processes 4222 Strategic employee 5 communication model 6 7 8 traditional communication components, such mid-level management must be directly 9 as messages and media are at the heart of the involved in and assume responsibility for 20 model, but the direct link to the company’s communication up, down and across the 1 strategic objectives and the business plan- organization. In a major change situation 2 ning process plus the overlay of supportive as well as for day-to-day operations, com- 3 management with ongoing assessment of munication is not just what the communi- 4 individual and company communication cation staff does. Managers must model 5 move the model from the tactical to the strat- the behaviour they expect of their 6 egic level. employees, the old adage of ‘walking the 7 From the research into the company exam- talk’. They set the tone for an open or 8 ples of effective employee communication, closed flow of information. Without them, 9 the following best-practice definitions emerge: the channels of communication cannot 30222 flow freely. 1 1 Strategic objectives: In high-performing 3 Targeted messages: Targeted messages are 2 companies, employee communication simply information tailored to the audi- 3 reinforces the company’s strategic objec- ence (i.e., messages in different words for 4 tives. There should be a one-to-one cor- different people when necessary), so that 5 relation between what the company has the information is relevant and meaning- 6 established as its strategic objectives and ful, at the same time that it is consistent. 7 what is listed as the objectives for the Thus, each business unit or division must 8 communication. In addition, the com- tailor the important messages to their 9 munication must be structured to trans- employees, and if necessary, convert the 40 late the central strategic messages (from overall message of the corporate centre 1 vision to performance or financial goals) into the digestible and actionable mes- 2 to all employees. sages the employees can understand and 3222 2 Supportive management: Top-level and act upon.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 4 Effective media/forums: Effective employee communication goals for employee communi- communication uses all vehicles to reach cation improvement and the change com- its audiences, but most importantly, it munication programme. The model serves as relies on direct, face-to-face communica- a tool to approach employee communication tion over indirect, print or electronic as a company would any analysis, that is, media. Thus, interpersonal communica- breaking the whole down into manageable, tion training, meeting management, and carefully defined parts. These definitions facilitation skills are necessary for all can serve as a benchmark against which managers. companies can measure the potential need 5 Well-positioned staff: The communication for communication improvement in their staff needs to be close to the most import- organization so that employee communi- ant business issues, involved in the strat- cation will help in facilitating the change pro- egic and business planning processes. They gramme. must have a ‘seat at the table’. Being a member of the senior management team allows the senior communication officer to How to design an effective change understand the company’s strategy and communication programme to participate in the decision making. In addition, the communication staff should The design of the change communication probe seen as facilitators of change not just as gramme needs to grow out of the size of the producers of publications. change programme and the company’s cur- 6 Ongoing assessment: The effectiveness rent communication practices. Is the proposed of the company’s communication needs to change major or incremental? Is the change be measured company-wide formally and company-wide or business-unit specific? How frequently against clearly defined goals on many employees are involved and affected? an ongoing basis and throughout the key How effective are the current communication stages of any major change. In addition, practices? Are they strong enough to carry a communication effectiveness needs to be major change programme? If the changes are evaluated as part of each employee’s indi- major and essential to company performance, vidual performance appraisal with the companies cannot afford not to improve the appropriate recognition for excellence. current communication practices if they find 7 Integrated processes: Communication them lacking. They must devote the necessary needs to be integrated into the business time and resources required to assess and processes with communication milestones improve employee communication before included in the business plan and as they launch the change programme; other- part of the business planning process. wise, the change programme will never get off Communication should be placed on the the ground. agenda of meetings and built into the The specifics of any change communica- management discussion of strategic tion programme are particular to the com- objectives and planning. pany; therefore, they must come from inside the organization and not from outside. An By using the model and best-practice defini- approach from off the shelf seldom, if ever, tions, a company can create very tangible works for any organization. No one should

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 force the strategic employee communication the change programme evolves; the feedback 2 model or any other model on a company loops indicate information coming in that 3 from the outside. Instead, the strategic em- influences the action plan once the change 4 ployee communication model and change programme is under way. Any action plan is a 5 communication approach should be used living plan although phases and most of the 6 to work from the inside of the organization actions represented here will need to occur in 7 to determine what is needed and to design most change programmes. 8 the appropriate change communication The first phase of analysis and strategy 9 programme to fit those needs. Thus, the development is critical to the success of any 10 model provides an analytical tool to diag- change programme. The analytical phase for 1 nose a company’s communication strengths change communication is often the phase 2 and weaknesses and to frame the change management will omit or minimize because 3 communication plan and resulting pro- they fail to recognize its significance, fail to see 4222 gramme. communication planning as strategic, or fail 5 The three-phased action plan below can be to see their way clear to allowing the time 6 looked at as one way to map out a company’s and attention it needs; however, without the 7 programme, one that has been successful and careful analysis of the current employee com- 8 that can be adapted to a company’s particular munication situation, the company is shooting 9 needs (Figure 2.2). Each of the three phases in the dark in developing the change com- 20 contains the specific actions that are to be munication programme. They do not know 1 taken to implement the change communica- where the communication breakdowns are 2 tion programme. They may vary slightly from and how best to reach the organization with 3 company to company, and they will evolve as the key change messages. 4 5 6 7 Feedback loops 8 9 Perform analysis/ Refine communication/ Continue workshops/ Phases 30222 design strategy start workshops monitor results 1 Actions • Form a strategic • Develop and test • Continue change 2 communication team preliminary communication/ 3 (SCT) messages job redefinition 4 • Assess current • Launch cascading workshops until all communication vision, strategy, employees reached 5 • Measure against job redefinition • Measure results 6 best practices workshops • Establish ongoing 7 • Conduct interviews • Develop feedback processes and audits continuous • Build link to 8 • Develop change communication plan business plan 9 communication plan

40 Timing 1st month 2nd – 3rd month 3rd month – until all 1 employees reached 2 3222 Figure 2.2 Three-phased communication strategy plan

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors The three-phase action plan contains four training in the jargon of our discipline, the essential actions for an effective change com- benefits of having diverse, front-line, opera- munication programme: tional members clearly outweigh the additional training time required. It can often 1 forming a strategic communication team; mean the difference in the employee com- 2 assessing current communication prac- munication improvements being accepted tices; at all levels. They become additional arms, 3 conducting cascading vision, strategy, job legs, and brains for the communication staff redefinition workshops; and often become part of the change pro- 4 monitoring the results. gramme’s mechanism that ensures the changes remain after the ‘official’ team no longer exists. Although the make-up of the Forming a strategic communication team will differ from company to company, team (SCT) the characteristics of the people selected should be as follows: cross-functional, all A full-scale change communication pro- levels and geographic locations (if relevant), gramme requires dedicated resources consist- respected and trusted by their peers, open ing of not only a few communication staff and honest communicators, skilled at facilita- members, but selected employees and tion, and finally, they need a commitment management. The first step in starting any from their supervisors to allow them the time change communication programme is to to be a dedicated part of the team. form a multi-level, cross-functional employee The SCT will be the heart of any improve- team. The SCT will have four primary objec- ment programme and will need to be care- tives: fully selected from a cross-section of the organization. They will do the day-to-day 1 assess the company’s current communica- work of the employee communication im- tion practices; provement and change communication pro- 2 address any employee communication grammes. After the core team is formed and improvement gaps; the preliminary analysis completed, the team 3 design and implement the change com- can be broken down into sub-teams to focus munication programme; and on the topics of greatest concern. The sub- 4 serve as change ambassadors. teams will be needed to manage the workload and to allow in-depth focus on the essential The team will need to be fully dedicated since and immediate improvement areas. Figure they must address these objectives simultane- 2.3 provides an example of how the SCT ously, working fast to make any needed would fit into the organization and how the improvements in employee communication sub-teams might be organized. In this exam- when the change programme is launched. ple, the sub-teams correspond to the compo- One requirement for having a successful nents of the model, but these sub-team topics SCT is to have non-communication staff should grow out of the preliminary assess- make up most of the team. Although these ment to ensure they are the major communi- non-communication people may need some cation improvement areas. The sub-teams will

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 CEO/ • Champion change communication programme president • Support SCT and ensure implementation of improvement ideas 3 4 5 • Provide improvement ideas to SCT Management • Support SCT and help with implementation of SCT’s 6 team 7 recommended actions 8 Member characteristics: • Conduct assessment  • Cross-section of employee 9 • Develop improvements functions and levels 10 SCT • Design change communication  • Respected and trusted by peers 1 • Serve as communications • Good communicators • Supported by management 2 ambassadors  3 4222 5 Sub-teams 6 7 Message/ Strategy Media Staff Assessment 8 materials 9 • Perform analysis of topic areas 20 • Synthesize findings and coordinate with SCT 1 2 Figure 2.3 Sample SCT structure 3 4 5 work independently, but interact frequently Assessing current communication 6 to avoid duplication of effort and ensure no practices 7 issues fall through the cracks. 8 The SCT will be linchpin of the develop- One tool that the SCT can use to facilitate the 9 ment and implementation of the change com- assessment is the scorecard (Figure 2.4). This 30222 munication programme. They will provide scorecard allows a ‘quick and dirty’ assess- 1 information from and to the organization, ment of the company’s current communica- 2 and they will bring credibility to the change tion practices. Also, use of the best-practice 3 communication effort. Just having a cross- deﬁnitions and their opposites is one method 4 functional, multi-level team of non-communi- to begin to educate management in what 5 cation people working on communication strategic employee communication means 6 sends a message in most organizations that while determining the company’s improve- 7 changes are occurring. Communication starts ment targets. 8 to be seen as the responsibility of all employ- In addition to the assessment, a few inter- 9 ees, not just a select few. Also, the team mem- views of key managers and a cross-section of 40 bers become communication ambassadors employees to gain insight into their perspec- 1 who can more effectively reach deep into the tives and to start to build their support com- 2 organization to ensure widespread under- bined with an audit of current communica- 3222 standing of the messages. tion vehicles and a review of any employee

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Where are the company’s employee communication practices at present? Place an ‘x’ on the scale below to indicate your preliminary assessment opinion:

Strategic Communication planning aligned with company’s Not aligned strategic goals

Processes Communication integrated into yearly business Not integrated planning process

Management Management accepts major responsibility in Does not accept communication

Messages Targeted, consistent, strategic Shotgun, inconsistent, tactical

Media/forums Emphasis on informal, face-to-face Publication focus

Communication staff Strategically placed as change agents Functionally isolated

Communication assessment Measured frequently and included in Not measured, included performance appraisals

Figure 2.4 Scorecard of current employee communication surveys that human resources may have con- improve as the change communication pro- ducted will reveal enough to gain a sense gramme is implemented. If, for instance, the of the organization’s typical communication current media are shown to be deficient in approach and any communication areas reaching employees, the SCT must find new, needing particular improvement. This prelim- effective channels immediately. The work- inary assessment then can form the founda- shops often serve as one of the new channels tion on which to build the change com- once the change programme is under way, but munication programme. since the cascading workshops take some time Where a company ends up on each compo- to reach all employees, the company will nent will determine how much time and effort need to find other ways to keep the employ- will be needed to improve the current ees informed and to ensure the change mes- employee communication practices before sages are getting to the targets. In addition, if and during the change communication pro- the communication staff is isolated and seen gramme. A couple of the components may as a ‘publications-only’ group, they will need need to be addressed before the change pro- quickly to be brought into the change process gramme can be fully launched, but most will and moved into roles as facilitators. Finally, if

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 key managers are diagnosed as uninvolved changes. Therefore, the senior management 2 and unsupportive of communication, they will group needs to convene and develop a vision 3 need to be coached and encouraged immedi- that captures the company’s new direction. In 4 ately to become a part of the employee com- addition, management must deﬁne the strat- 5 munication improvement efforts. egic objectives that support that vision. It 6 The model serves as a starting point for the often helps the organization to understand the 7 preliminary assessments of the current com- changes if they can see the key objectives as 8 munication practices and will help determine they are now and as they will be in the new 9 how much improvement is necessary before organization to ensure the success of the 10 the change communication programme can change programme. A simple ‘from/to’ chart 1 be successful. can be used to picture the changes. For exam- 2 ple, a computer company might have the 3 following as its vision and strategic objectives 4222 Conducting cascading vision, strategy, (sample only): 5 and job redeﬁnition workshops 6 Vision 7 The success of any change communication To be the market leader in providing high- 8 programme will depend on a company having performing, cost-effective enterprise servers, 9 a clearly stated, believed in, understood and solutions and services for our customers by: 20 meaningful vision statement, which manage- 1 ment should be involved in developing and • providing products at a superior value to 2 communicating. A ‘meaningful’ vision is more meet customer needs from mid-range- 3 than a catchy saying on a coffee cup; it is a level to high-level functionality; 4 clear, actionable, realistic and measurable • Creating comprehensive integration of 5 statement of what the company wants to be critical solution components. 6 (Jick, 1989; Collins and Porras, 1996). 7 If a company already has an acceptable The strategic objectives can then be broken 8 vision, they need only measure its under- into their parts to determine what the changes 9 standing and reinforce it; however, often are in line with the new vision. Thus, their 30222 the vision no longer works for the company, ‘from/to’ might be as shown in Table 2.1 1 particularly if they are undergoing major 2 3 Table 2.1 Strategic objectives 4 5 Strategic objectives From To 6 Providing products at Hardware, software, and solutions Hardware and solutions only 7 superior value for all computers for servers and complex enterprise 8 systems 9 Value to us, low volume at high cost Value to customer, high volume, 40 to customer low cost 1 2 Creating integration Fragmented products and services Connected components within in isolated pockets the enterprise system 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Once senior management has established are important and the organization wants the vision and supporting strategic objectives, their support and understanding of what the then the SCT needs to develop two rounds changes mean. At some point (usually after of workshops. The first one is for the first meetings with 5 per cent to 10 per cent of the few levels of the organization on the case for organization), the change messages will start change, the major change messages, the to receive fewer and fewer suggested changes. vision, and the strategic objectives. This first At that point, the SCT can consider the new round should include break-out sessions to vision, strategic objectives, and any other sup- test and refine the vision and obtain em- porting change materials as established ployee feedback on improvement ideas (although some minor tweaking may still be with the upper-level management across all needed once the vision is to become pub- business units. The SCT should synthesize lished and communicated externally). The SCT all suggested changes to the vision and adjust is then ready to move into the next round of the vision for each subsequent workshop. workshops. They should also collect and organize all im- The second round of workshops consists of provement ideas into groups, arranging them a roll-out across the entire organization of the into buckets according to how important and vision, strategy, and idea generation with the practical they are. Any ideas that can be addition of job redefinition sessions, which implemented immediately, should be, which are break-out discussions on how specific jobs will send a signal that management is open to will need to change under the new company. ideas from all levels of the organization. These, too, should include as much man- Depending upon the size of the organiza- agement involvement as possible. The leaders tion, these workshops will take a few months that emerged from the first round can be with one workshop every two weeks including recruited to serve as ambassadors and even twenty to thirty employees each. The vision facilitators for this round of workshops. will change somewhat with these employees The more employees participating in these playing a part in shaping it into something workshops, the better, so that the word is meaningful to all business units and most spread and greater buy-in is established. That functions and levels. The key to success in will also allow faster dissemination of the these workshops is that management partici- change messages. These workshops must pates and is open to new ideas. At the same be held until everyone in the company has time that the change messages, including the participated. vision and strategic objectives are evolving into something the organization as a whole can understand and act on, management is Monitoring the results beginning to buy in to the changes themselves. Senior-level management should kick The results of the change programme must be off each workshop and come back in to close, monitored frequently. In the first few months, and management at all levels should be in particular, it is important to keep in close actively involved in the workshops as touch with how well the organization is hear- observers and participants. ing, understanding and accepting the change This first round of workshops is important messages. In addition, the media need to be to gain employee confidence that the changes monitored to determine which are effective.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 The quickest way to obtain a picture of the • immediate follow-up on employee ideas 2 ‘what’ and the ‘how’ is to send out very short and rewards for good ideas and good 3 surveys to a stratified sample of the organiza- communication; 4 tion. Depending upon which channels work • barriers to success addressed immediately 5 for the organization and the different groups upon discovery; 6 in the company, these surveys can be distrib- • ongoing monitoring of communication 7 uted electronically through email or on the effectiveness. 8 company intranet or distributed hard copy. 9 Phone surveys work as well, again, depending Underlying any of the critical success factors 10 upon the culture and the preferred way are the continual signals along the way that 1 of communicating. The survey should be change is happening and that the change is 2 designed to obtain mostly facts at first. For making a positive difference in the way the 3 instance, to establish facts on what messages company operates. The programme will not 4222 are being received and by what means, be judged a success unless it makes a mean- 5 the survey could ask: (1) What is your level of ingful difference not only for the employees 6 understanding of the changes occurring in the but for the company overall. And, of course, 7 company? (2) What is your most frequent the managers will ask, ‘Was it worth all of the 8 source of information about the changes? effort?’ 9 The more open-ended questions might be: (1) One key to building management commit- 20 What is the new vision for the company? (2) ment is the success of the SCT along the way. 1 What changes do you see occurring in If the team is functioning as it should, the 2 your group that demonstrate the new vision? company will see immediate improvement in 3 Only after the cascading workshops are com- communication from the day the team is 4 pleted would the SCT want to conduct any launched. The team by its very existence 5 surveys on attitude or morale since the demonstrates a change in most companies. 6 employees need the workshop interactions to The depth of its impact, however, will depend 7 internalize the changes and feel they are part on the supporting mechanisms put in place 8 of the new organization. to reinforce the team’s recommended com- 9 The four central actions discussed above munication improvements and the frequent 30222 can influence the level of success of a change assessment of individual and company com- 1 communication programme, but at the end of munication performance areas as well as the 2 the day, complete success depends upon the rewards for ‘good’ communication through- 3 following from management: out the change programme. 4 Thus, the model helps to bring very specific 5 • senior management commitment to the focus on the employee communication im- 6 importance of the change communication provement needs and to provide an analytical 7 and a willingness to devote necessary tool that helps to organize and control the 8 time and resources to ensure its success; change communication planning. In addition, 9 • emphasis on hands-on interaction be- it can help with implementing the changes in 40 tween management and employees internal communication processes necessary 1 (small groups, two-way exchanges, idea to ensure the success of the change communi- 2 generation sessions, job redefinition work- cation programme. It allows the company 3222 shops); to determine where it needs to place its

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors employee improvement efforts, at the same The strategic employee communication time bringing the improvements necessary model and best practices bring employee to support the change programme, such as communication to its necessary strategic level opening up the communication channels, of operation and facilitate the design of a increasing the role management plays in change communication plan that can make a employee communication, and making com- major change programme succeed. munication central to the change programme. In review, to develop a successful change communication programme, you should do the following: Summary 1 Form a strategic communication team In summary, change communication consists made up of a cross-functional, multi-level of the basic components of all good employee group of employees. communication: targeted messages, selec- 2 Assess current employee communication tive media and clearly defined audiences, practices against best practices. but it needs to be much more to facilitate 3 Target any gaps in communication for change. During major change, effective em- improvement immediately. ployee communication holds an organization 4 Work with senior management to develop together, allowing the smooth operation of a vision and strategic objectives. the organization and linking all other pro- 5 Conduct cascading vision, strategy, job cesses of the organization, such as the strategic redeﬁnition workshops. and business planning processes, together to 6 Monitor the results throughout the form the foundation for effective change com- change programme and be prepared to munication. Raising employee communica- make adjustments if you ﬁnd evidence of tion to the strategic level is essential to the breakdowns in communication. success of any organizational change effort.

NOTE

1 This research included secondary research as well model components as well as information on the as interviews of Fortune 500 companies. The communication staff functions, organization, and resulting data base contains information on the budget for over 40 companies.

REFERENCES

Ashkenas, R. N. and Francis, S. C. (2000) ‘Integration Eccles, R. G. and Nohria, N. (1992), Beyond the Hype: managers: special leaders for special times’, Discovering the Essence of Management, Boston: Harvard Business Review. Nov.–Dec., 108–16. Harvard Business School Press. Collins, J. C. and Porras, J. I. (1996) ‘Building your Jick, T. D. (1989) ‘The vision thing’, Harvard Business company’s vision’, Harvard Business Review School Case, Boston: Harvard Business School Reprint, Sept.–Oct., 65–77. Press, 1–7.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Kanter, R. M., Stein, B. A. and Jick, T. D. (1992) The Kotter, J. P. (1995) ‘Leading change: why transforma- 2 Challenge of Organizational Change: How tion efforts fail’, rpt in Harvard Business Review on 3 Companies Experience it and Leaders Guide It, New Change, Boston: Harvard Business School Press. York: Macmillan. Strebel, P. (1996) ‘Why do employees resist change?’, 4 Katzenbach, J. (1995) The Real Change Leaders: How to rpt in Harvard Business Review on Change, Boston: 5 Create Growth and High Performance at Your Harvard Business School Press. 6 Company, New York: Random House. 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Stephen A. Roberts

The corporate communicator needs to know how to manage information effectively both individually and within the task/group/organizational setting. In practice corporate communication practitioners are needed who are able to exploit the riches of the worldwide web and other electronic resources with conﬁdence and intelligence, but at the same time realize that traditional information and library skills also have their place in their practical repertoire. Such skills can reinforce strengths in business and organizational information seeking, but today and increasingly in the future this will not be enough. Full professional competence requires a mastery of a totality of capacities and qualities in information. This chapter reveals how the strategic response to this need is being realized through the development of knowledge management: as a key norm within corporate communication theory and practice.

Context communication. Information and knowledge management thus become complementary The corporate communicator’s work is ethic- and self-reinforcing to corporate communica- ally committed to truthful and verifiable tion practice. information. So, there is a premium on ﬁnd- Policy and practice is moving to a state ing out the facts: getting the right data and where the total management of information information together on clients, events and and knowledge resources is a desirable norm issues. This contributes to the better under- and constituent of the corporate communica- standing of clients’ needs and enables the tion function. This chapter sets out to address consideration of the right responses to prob- how this strategic goal might be achieved. lems and the construction of appropriate mes- It will require an exploration of concepts sages. It is normative to ensure that corporate and practices within a considerable spectrum communication action is driven by quality of information, intelligence and knowledge information: the best guarantee of quality and a reﬂection on the major constituents of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 corporate communication practice. Concepts diverse and complex world, where the under- 2 and terminology require definition and standing of and responding to stakeholder 3 models of processes need elaboration to pro- interests and claims is of the highest import- 4 vide some intellectual cohesion. ance. And, responsive furthermore to the 5 In practical terms this means inter alia the ethical and legal constraints of the environ- 6 following: ment as well as sensitive to human and social 7 conditions. Transparency of information and 8 • Corporate communication professionals communication must be a goal for all in this 9 need to have a good grounding in profession. 10 personal information and knowledge 1 management skills. 2 • Through their professional education The information basis: 3 corporate communication professionals a foundation for knowledge 4222 need to acquire a good range of transfer- management 5 able information and communication 6 skills to add to their general portfolio of The concept of information provides a useful 7 communication and professional skills. starting point for this review. Whilst not with- 8 • The corporate communication profes- out challenge to provide a robust scientific and 9 sional needs to be able to put both professional definition (as the literature of in- 20 understanding and skill in information formation science will show) the term has wide 1 management at the disposal of the client colloquial understanding (even misunder- 2 in every way as an exercise of professional standing) and literary warrant: it means some- 3 techniques, through ethical and legal thing specific to most people and its meaning 4 responsibility, and as a contribution to is frequently and currently traded. It is a useful 5 meeting client needs as an outcome of term to denote facts, a variety of data, things 6 which inform, things which are useful, an 7 quality management. assortment of things which are known and it is 8 • Ensuring that the corporate communica- 9 tion practitioner can effectively manage even given further significance by statements 30222 information and knowledge resources such as ‘information is power’ or that inform- 1 within their organization by the establish- ation empowers. The use of information re- 2 ment of information strategy and policy, veals it to have properties which can bring 3 action planning and effective manage- about change, transformation and gains. 4 ment of work, in order to maximise the Information specialists have found it help- 5 value of information and knowledge ful to use the term with greater precision, for 6 resources and to reduce all risks to them- instance distinguishing between formal in- 7 selves and their clients arising from formation (usually considered to be published 8 information and knowledge work and or publishable information, which has been 9 communication activities. or is going through some processes of trans- 40 formation) and informal information (often 1 Through effective information management information personally possessed, which is 2 corporate communicators are better equipped provisional, or imparted through conversa- 3222 to exploit their specialist competences in a tion, telling and sharing and so on). Specialists

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors take this further and distinguish between tion resource management and by the late different kinds of formally published informa- 1980s was consolidating around the emergent tion (popular books, monographs, periodical practices of knowledge management. publications and their electronic equivalents) Information and knowledge management and informal information and communication has emerged as a corporate and business activities within a social context (meetings, related activity, stemming from initiatives in seminars, conferences and even documented market research, market, product and com- contributions which have received less than petitive intelligence, business information, absolute reviewing and refereeing). Informa- management information, consulting, model- tion managers (librarians, information service ling, decision support and business and corp- providers, database providers, webmasters, orate policy. It also continues to have a etc.) have elaborated their competencies and significant impact on the work of library and craft on this basis. information professionals who form a signifi- All these efforts however have seemed cantly valuable feature of the knowledge limited in face of the extent of human ingen- supply chain for such communities. uity and capacity for thought, endeavour and The relevance of information and know- action. For a long time information profes- ledge management to corporate communica- sionals had to be content with an operational tion lies in the importance of information as a scope, which however significant, was natur- resource in the organization and in the corpor- ally limited. They could serve their users and ate communication process. Successful corp- provide information but they could not orate communication is driven by many other manage their use of information (except in a forces and requirements, but the techniques limited way) and influence the effects inform- of information and communication used and ation might produce. There were naturally their management form a common infrastruc- limits to their role in any grand shaping of tural element. knowledge (and never did they realistically The study of corporate communication claim such ambitions). Nevertheless, the im- requires an understanding of both the busi- petus to seek greater management capacity ness and client environments and manage- over the totality of information has evolved ment principles and practices, as well as issues along with the growing complexity of the relating to information per se. Information modern world. Inevitably, the desire and need and knowledge management features have for a strategic capacity over information has evolved concurrently with changes in the busi- extended to capacities over a more total range ness environment: for example, the influence of behaviours. The human processing of of the information and communication tech- information towards knowledge gained and nologies; strategic business and IT; the global retained has indicated where this strategic marketplace; the virtual corporation and capacity lies and has suggested necessary e-business and e-commerce. The current and useful responses. The management of importance and impact of the worldwide web information has been progressing towards in marketing and corporate communication is realizing the capacity to manage knowledge. now an accepted feature. This movement began professionally in the Whilst the corporate environment has en- mid-1970s with the emergence of informa- gendered knowledge management, the future

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 will see wider ramifications in society and for The corporate communicator has always 2 the citizen as a whole: for those who inhabit been an information worker, and can ever 3 the global corporate marketplace as citizens, more now be considered a knowledge worker. 4 rather than for those who just work in the Corporate communicators will find it vital to 5 global corporation or local enterprise. incorporate knowledge-related concepts into 6 These trends in information and knowledge their professional practice in a more explicit 7 management are already impacting on corp- way than hitherto. Knowledge-based organ- 8 orate communication, through digital media izations and clients will be best served by 9 and electronic business and commerce. knowledge-sensitive corporate communi- 10 Citizens in general and in their roles such as cators. 1 employees and consumers, as well as other The theories and practices of information 2 stakeholders, are discovering new means of management, organizational management 3 empowerment through the information and and behavioural science as leading tools and 4222 communication technologies (ICTs). Such em- techniques provide the tools and techniques 5 powerment has to be understood by the prac- for knowledge management as an integrated, 6 titioner and reflected in new methods, means hybrid and synthetic methodology which 7 and balances of communication activity. exploits information as a resource, facilitates organizational and individual decision mak- 8 The domain and discipline of knowledge 9 ing, and acknowledges the ways in which the management has emerged partly as the in- 20 resourcefulness of information (and know- formation and communication technologies 1 ledge) produces and necessitates change in have come to form an infrastructure for many 2 organizational and individual behaviour as kinds of data and information related activi- 3 goal fulfilment is sought. ties in organizations and society. It has also 4 The rationale for this application to corpor- emerged in relation to secular and structural 5 ate communication lies in the progressive evo- 6 changes in markets, business environments, lution of information and communication 7 global conditions and new technologies. activities in a global setting. Information sys- 8 Knowledge management extends the al- tems, information management and informa- 9 ready developed concept of information tion services provide the platform upon which 30222 (explicit knowledge) and intelligence (often the higher order range of knowledge-related 1 a hybrid of explicit and tacit knowledge) as a activities are built. In the education of the 2 resource, by incorporating, amongst others, corporate communicator the incorporation 3 the concepts of tacit and shared knowledge as of these studies and practices is a natural 4 leading paradigms. Knowledge management progression for intellectual and professional 5 extends existing concepts of comparative development. 6 and competitive advantage in the corporation 7 or firm (based on strategic use of IT and trans- 8 action cost concepts) through to the idea of Informational aims and 9 knowledge resources (intellectual capital and objectives 40 intellectual assets), which thrive best in holis- 1 tic and synergistic environments characterized In developing a programme for knowledge 2 as the knowledge organization and the learn- management in corporate communication the 3222 ing organization. following aims can be selected:

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors • The identification of the concepts of data, The information and information, intelligence and knowledge communication rationale as they occur and impact on the discipline and practice. Information management and the • An exploration of the methods, tech- corporate communicator niques and circumstances in which information, intelligence and knowledge The principles discussed here are designed management principles can be applied to to underpin the skills and competences of corporate communication. corporate communicators by providing a • The incorporation of the social, behav- disciplined understanding and insight into ioural and organizational conditions asso- information and communication. Some fam- ciated with information and knowledge iliarity with the professional world of informa- management in corporate communication and knowledge management practice tion settings. will help corporate communicators explain • The development of strategies by which their information needs to information organizations and stakeholders select and specialists and provide a body of knowledge promote data and information and to and competence to achieve a degree of auton- examine the consequences which ensue. omy in working with information both with corporate communication colleagues and • The identification of the intelligence with clients. needs of clients in specific settings and to This autonomy and competence will in- research, collect and present their findings crease the efficiency, effectiveness and respon- to their clients. siveness of the corporate communicator. This • The exploitation of the capacities of ICTs will help to underpin corporate communica- and information handling tools to support tion techniques and solutions by providing knowledge management and to meet the sound information and communication strat- knowledge needs of client communities egies. and domains of practice. • The identification and development of criteria on which the basis of information, The information and communication intelligence and knowledge activities can cycle be evaluated. • The evaluation of the impact of informa- The idea of an information and communication, intelligence and knowledge manage- tion cycle is one of the fundamental concepts ment strategies, resources and techniques of information analysis. The corporate com- on client communities and domains of municator will already be familiar with analo- practice. gies to the information and communication cycle (ICC) in marketing and media activity. The discussion that follows explores this Rowley (1999) offers an interpretation of the agenda firstly from a conceptual viewpoint ICC from the perspective of information and then develops a practical programme that management. Such a model can suggest the could help to build the relevant competences intensities and directions of flow of informa- for corporate communication professionals. tion (for example from a demand and supply

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 perspective) which can be applied to corpor- analysis and exploitation. Nowadays these 2 ate communication settings. technical resources can be delivered equally 3 Questions for the corporate communicator to the desktop and to the field of operation 4 include: how much information exists about a using mobile communications. There are 5 given issue; who is in possession of such many circumstances where these techniques 6 information; what is the level of quality of the have to be practised and applied in varied 7 information; what is the nature of the com- and unstable field conditions. It is in these cir- 8 munication activities used and preferred; how cumstances that the information and know- 9 can information be processed and managed ledge experienced corporate communicator 10 at different points in the cycle to relate to will have the advantage. 1 different needs and conditions; what are the 2 optimum methods to gather, store, analyse 3 and retrieve information; how can relevant Definitions of information management 4222 information be targeted to the stakeholders 5 and their concerns. Information management is concerned 6 Communication refers to the process of with the selection, evaluation, description, 7 information transfer and the initiation and storage, retrieval, manipulation and pre- 8 reception of communicated content. Informa- sentation of information. 9 tion refers generically to content which can (Askew 2000) 20 take many forms: data, information, intelli- 1 gence, knowledge. The variety of forms of Information management (IM) can be 2 both information and communication are defined literally as the formal organization 3 numerous. Two related concepts can also be of handling of information. 4 introduced. Supply denotes broadly the avail- (Roberts 1997) 5 ability of content. Demand implies states of 6 want, need and requirement for content These definitions can be realized in terms of 7 which may or may not be expressed or re- activities undertaken by professional informa- 8 alized. Demand and supply are also used as tion specialists (information manager, library 9 more technical terms in economic analysis, and information service providers, etc.), in 30222 and these analyses are also relevant to the terms of personal competences, and in the 1 study of information. wider social and organizational setting of 2 Information management is concerned cen- corporate communication. 3 trally with the management of information The two definitions of information man- 4 supply and the mediation of information agement are complementary. Askew gives 5 demand. This information management activ- emphasis to the process itself, and directly 6 ity can be carried out individually, collectively suggests a sequence of functions which have 7 and institutionally; in reality the three con- a good fit to parts of the information– 8 texts are frequently simultaneously active. communication cycle. Roberts implies the 9 This suggests that information management is functions denoted by Askew and which are 40 a dynamic area; it is active and proactive, implicated in Rowley’s interpretation (1999) 1 rather than passive. The central task is under- but which embodies a general (if abstract) 2 pinned by techniques in data and information concept of organization (formal, rather than 3222 (and document) storage, handling, retrieval, informal; more structured rather than less

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors structured). The lack of formal organization resources (intellectual capital and intellectual implies disorder, chaos, randomness, chance assets), which are best disseminated and and suggests inefficiency and lack of effective exploited in a more holistic environment. performance. In practice knowledge management can However, it may be possible for informa- flourish optimally in particular kinds of organ- tion management to take place in informal izational context which are associated with circumstances and still be very effective particularly characteristic social behaviours (e.g. grapevine-style communication that (e.g. Leonard-Barton, 1995; Nonaka and propagates positive information). But such Takeuchi, 1995). apparently informal environments may have an implicit formal structure embedded in them. Data, information, intelligence and Knowledge is a much more comprehensive knowledge: concepts and inclusive complex: it has to be defined not only in terms of content but also in terms It is helpful to make clear some distinctions of time, space, experience, learning and and definitions, especially relating to data, organizational and social activity. What is information, intelligence and knowledge. recognized so far is that information manage- Better awareness of them will help corporate ment is a core contributory element to the communicators improve, even optimize, their growth of knowledge management as a com- information and knowledge management. petence, within the wider knowledge space Data can be regarded as the most elemental (of interpersonal frameworks and so-called level of analysis; a ‘bit’ is the smallest learning organizations, e.g. enterprises which unit of analysis. Data can take various forms. have adopted knowledge management strat- At its most basic, Shannon and Weaver (1949) egies/practices to contribute to their develop- argued that it can be represented as a binary ment, or groups of practitioners in ‘communi- state (On or Off/1 or 0). In a computer, in- ties of practice’, who collaborate to share, dis- formation (and more complex units of data) is cover and create new knowledge). represented as binary data, and can therefore The incorporation of knowledge manage- be manipulated in an electronic state through ment in the core practice of information pro- flows of energy in switches, gates and other fessionals reflects contemporary trends as well devices. as potential future goals for information Data is also used as a concept and term to management. IM (information management) represent more complex constructs such as and KM (knowledge management) can have numerical values and linguistic symbols separation but are best developed when (through alphabets). When these data ele- intimately related. ments are combined in various ways human As previously stated, knowledge manage- beings have the capacity to give them an ment extends the already developed concept enriched context and by passing through cer- of information as a resource by incorporating tain thresholds of presentation and compre- amongst others, the concepts of tacit and hension (which may be conventional or shared knowledge as leading paradigms. arbitrary) the resulting aggregate is usually It is thus possible to talk about knowledge called information.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 For example, as this process is activated acquired, stored, processed and transferred 2 data is given greater meaning. When all the through different distribution channels. In re- 3 cells of data in a spreadsheet are seen as a ality, there is a fierce debate about the nature 4 whole they may be given greater meaning as of information but we can accept it pragmati- 5 a set of information (which can be presented cally as a central operational concept. 6 to a client, stakeholder or decision maker). For 7 example, statistical analysis of the data would 8 help to increase its meaning or value as data Knowledge: how can it be defined? 9 or information. To be more accurate we can 10 say that the probability of this increase in Arising from the preceding discussion about 1 meaning and value happening is greater. some precursors of knowledge there is some 2 Shannon and Weaver developed their ideas indication as to how knowledge can be 3 through studies of telephony. Their ideas defined in the context of information man- 4222 helped to map out a debate about the nature agement and its potential contribution to 5 of information, leading on towards the digital knowledge management. Pragmatically, other 6 concepts which sustain the present generation debates about the nature of knowing and 7 of computer based technologies. These tech- knowledge have to be set aside; for example, 8 nologies are already influencing the ways in those prevalent in the fields of philosophy, 9 which organizations function and within psychology and sociology. 20 which knowledge management will be a The capacity to know things and to be con- 1 forceful activity. The resulting organizational scious of what is known could be defined as 2 model is the knowledge organization (exhibit- Knowledge (with a large ‘K’): this is human 3 ing characteristics of learning and experience) intelligence itself and the intelligent properties 4 or the learning organization. Use of technology derived from perception, which itself makes 5 is significant and necessary in the knowledge use of the psychological and biological 6 organization but is not sufficient. These organ- processes). Knowledge with a small ‘k’ com- 7 izations will be rich in data becoming inform- prises the things which can be known in a spe- 8 ation, but it will be of little value and cific sense and whose intelligent properties are 9 significance if such data (and information) is understood through human intelligence. 30222 not refined and processed by predominantly In practice we can safely use the term 1 social exchanges towards intelligence and knowledge (with a large ‘K’ or a small ‘k’) as 2 knowledge. an aggregate term to mean those things which 3 Linguistic data when highly structured in are perceived to be intelligent (having proper- 4 the form of language which can convey ties of being known or revealing knowledge) 5 meaning in spoken words and written text, is or as intelligence (as a source of knowing). In 6 certainly to be considered as being more addition, and very commonly, the aggregate 7 complex. Two people can read the same text concept of ‘knowledge’ is used to represent 8 and draw widely different inferences and things which are known by people, either 9 meaning from it. individually or collectively. This aggregate 40 Information it seems true to say owes a good ‘knowledge’ is also endowed with many prop- 1 deal to data of different kinds and to erties: part of the purpose of knowledge 2 the systems by which data is manipulated. management as a process is to study and act 3222 Information, like data, can be freely created, on these properties of knowledge, especially

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors as they occur in and affect organizations and They draw different conclusions by virtue other social complexes. of who they are, what they do, what they already know, their past experience, their future expectations, capacity to learn and so Intelligence and knowledge on. It is all relativistic, probabilistic and fuzzy; you may be more right or you may be less It is sometimes worth differentiating between wrong – it all depends. You may only know a the intelligence phase of knowledge and the end partial answer to this set, when some decisive state of knowledge, as when things are more event occurs to assist interpretation. completely known (things are never known in A company’s failure to gain market share or full!). This is the case when looking at sources the misfortune to go bankrupt is severe of intelligence (e.g. as in competitive intelli- indeed, but absolute blame can or cannot be gence), and how they are exploited and man- laid on the state of knowledge possessed aged, and how they contribute to forming before the damaging event. Lessons can be knowledge. In practical terms much intelli- learned from this; many businesspeople have gence gathering activity has to be accom- become more skilled entrepreneurs and man- plished in order to locate, acquire and create agers after a disaster, from which they have knowledge, therefore we need to be aware found powers of recovery. On the other hand and explicit about its contribution to know- there are many who do not experience this ledge. learning: better knowledge management is An equation might be of the form: clearly what they might require. This rather depressing example is not so gloomy as it Intelligence + knowledge (things already seems. It shows that knowledge is also posi- known) = More valuable Knowledge tively correlated with a capacity to learn. Many knowledge management specialists (note the distinction between the sense of have come to talk about the ‘learning organ- large K and small k). Or ization’; a knowledge organization is (amongst other things) a learning organization, which Intelligence (potential knowledge) manages to apply what it knows and learns + knowledge (existing and known) and which thus understands how to persist- = More valuable Knowledge (large ‘K’) ently avoid catastrophes and to capitalize on what it knows. Returning to the example of the spreadsheet, At the point of an act of reading by two we can say that intelligence is embedded in individuals, it would be fair to say that both the data plus information in the cells and the intelligent readings of the text might have matrix as a whole. But crucially it is only equal potential value. But we come close to a realized as intelligence when an external per- deﬁnition of intelligence drawn from the text, ception is brought to bear on it. The natural as well as acted upon, when the future intelligence of the perceiver’s mind is brought demonstrates that one reader put the percep- to bear on it within their experience and tion to better use than the other. A positive learning. It is similar to the case of the two outcome might be regarded as conﬁrming the people reading the text above and drawing value of the intelligence gained from a read- different conclusions from it. ing of the text.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 One helpful practical outcome from this danger as much as to make an economic, 2 discussion is that it indicates how necessary it social or political gain). 3 is to cultivate skills in intelligence from the Knowledge with a large ‘K’ can be defined 4 point of view of identifying it, capturing and as an aggregate of intelligence and knowledge 5 processing it, and putting it to good use. derived from intelligence (which may be 6 Corporate communication is rich in similar traced back to antecedent information and 7 analogies from the business and corporate data) and will show states of extension and 8 client field. Determining a client’s needs and completion. In usual discourse (and in this 9 offering clients advice requires depths of intel- chapter) the distinction between ‘large’ and 10 ligence as well as a thorough sifting of data, ‘small’ is lost. However it is described, know- 1 facts and information. The same set of inform- ledge may lead the possessor towards out- 2 ation is susceptible to different readings, so comes either positive or negative but both 3 corporate communicators weigh up intelli- reflecting the resourcefulness of what is 4222 gence and draw upon intuition, experience, known. 5 analogy and metaphor to shape and deliver Knowledge is now considered convention- 6 campaigns. Through the same process they ally as intellectual capital or assets. Stewart 7 develop their professional knowledge as a (1997) amongst others identifies customer 8 variety of intellectual capital. capital (client embodied knowledge), human 9 capital (especially the competences embodied 20 in the organization’s community of practice – 1 Definitions of knowledge: a conceptual its people and human resources), and struc- 2 basis tural capital (embodied in organizational 3 structures and systems). There is also propri- 4 Some attempt at a working definition of etary intellectual property (designs, patents, 5 knowledge has already been made through agreements, etc.) which seeks to enjoy legal 6 the exploration of data, information and intel- protection as well as other information assets. 7 ligence which leads to an appreciation of This intellectual capital is matched by financial 8 knowledge operationally and resourcefully: capital and physical assets. It is very clear that 9 the sense that a desirable purpose is to con- corporate communication professionals have 30222 sider how to manage it for beneficial ends. always worked predominantly with intellec- 1 For argument the distinction between small tual capital. Knowledge management, as 2 ‘k’ knowledge and large ‘K’ knowledge is much as information management, should 3 maintained. The former small ‘k’ knowledge now be seen as a core professional compe- 4 results as a reaction to known intelligence tence enabling the fullest exploitation of intel- 5 (derived from information and data). A lectual assets and capital. 6 person will possess knowledge when they 7 have absorbed the potential of a given ‘intel- 8 ligence’. The process of absorption itself is a Knowledge management 9 critical component of knowledge manage- 40 ment. Someone will know something to some Knowledge-based work and management is 1 degree, and furthermore will hope that it will distinct from, although related to, other situa- 2 lead to/contribute to positive outcomes when tions and people who work with and manage 3222 this is necessary (this may protect them from data (statisticians, data processors of various

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors kinds in organizations, data warehousers, etc.) Many commentators have chosen to make and information (library and information ser- a helpful distinction between know-what and vice personnel, library and information ser- know-how. As a working hypothesis know- vice professionals, documentalists, publishers, what is raw and less refined information web page providers and a diversity of content (it may be descriptive, factual, situational, his- providers, who work across the spectrum from torical, spatial, and so on). As formal informa- data to knowledge). tion it is typically stored and transmitted in In the corporate world it has become hard copy and electronic documents and increasingly common to define knowledge databases. Equally, it may have characteristics work and workers as a distinct cluster, which of informal information (mediated personally, may be supported by data processors, librari- disseminated socially and ranging from the ans and information managers, to name but vaguest to the most concrete and specific). It a few. It is also clear that many consultants, tends to lack or need further interpretation, experts, academics, pundits, journalists and contextualization and combination with other analysts can also be regarded as knowledge- sources, factors and insights. Higher-order based workers doing knowledge work. We information may show characteristics of intel- certainly have to include corporate communi- ligence (actual and potential added value, cators amongst this band. scarcity through limited ownership, confidentiality, conferment of advantage, etc.). Know- what is often equated as the factual, explicit, ‘Know-what’ and ‘know-how’ visible and easily transmissible information. criteria Know-how has the characteristics of knowledge (source of action, potential, capacity for The existence and reality of knowledge can change and competence) to which the learn- now be understood more effectively as a ing organization aspires and which lead it as result of its distinctive contexts and processes. an organization to acquire, create and maxi- It is not enough to regard knowledge as just a mize the value of the knowledge it possesses. denser form of information and intelligence It is likely to reflect experience, evaluation, (‘know-what’) but as a source of action, appraisal, deeper consideration, special in- potential, capacity for change and com- sight and so on. These mark out the intangible petence (often referred to as ‘know-how’). qualities which define tacit knowledge, and Knowledge management is therefore about which clearly require further and particular achieving this state of know-how through technique to realize its value and resourceful- intelligence gathering and managing know- ness. Knowledge management provides the ledge resources (intellectual capital/assets) tools and techniques to harness these qualities and of fostering, maximizing and increasing in a purposeful way. Thus, a very important the stock of it. The reality that the prime expo- distinction has emerged in differentiating be- nents of this art in the 1990s and early 2000s tween ‘know-what and know-how. are business corporations has led to the idea Knowledge management theorists regard of the new organizational type: the know- know-what as explicit knowledge. A collec- ledge organization (sometimes also known as tion of textual documents can be read by a learning organization, reflecting the role of many people who may or may not draw learning processes in acquiring knowledge). similar conclusions from what they read. The

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 text remains the same and this factual/ its location, storage, transfer and use has to be 2 informational know-what can be accessed managed in ways different to explicit visible 3 again and again. knowledge (better referred to as data and 4 By reading, the reader has already started information). 5 to process the text towards knowledge. This Looking at these ways of dealing with tacit 6 reader/user act of transformation is unique knowledge and with the boundary between 7 to the reader (unless the reader chooses to tacit and explicit knowledge is at the heart of 8 share that understanding and knowledge with knowledge and learning organizations which 9 another agent). The intelligent and thoughtful depend on knowledge management strategies 10 reading of the text has created a situation for their survival and growth, and are depen- 1 of tacit knowledge. This tacitly derived and dent on it for their comparative advantage 2 interiorized knowledge is know-how as tacit and competitive edge. 3 (implicit) knowledge. However, tacit know- Corporate communicators work in an 4222 ledge never exists in the explicit recorded and information society and their corporate clients 5 visible state, although it may be made explicit work in knowledge-based environments. 6 by telling or recording. Their stakeholders too are increasingly en- 7 Identifying, extracting, sharing and leverag- meshed in a global information society. The 8 ing this hidden knowledge has become the corporate communicator needs to have access 9 driving task of practical knowledge manage- to the extensive range of data, information 20 ment. The world of information is largely the and intelligence resources which represent 1 world of explicit and revealed knowledge, their clients’ and stakeholders’ interests. From 2 although its extraction and management may the basis of these collective resources corpor- 3 require very considerable labour and expense. ate communication strategy, policy, message 4 To a degree, the world of information is also and response can be built to develop image, 5 preoccupied with making the implicit visible identity and reputation. 6 and tangible. Knowledge management thus 7 grows in importance when what is known is 8 9 largely implicit (and only partially usable) Knowledge management: elements of 30222 but is needed by the collective. In all this, an operational deﬁnition 1 intelligence stands midway between informa- 2 tion and knowledge: it is knowledge applied • Knowledge management attempts to rep- 3 to information (and data) with the purpose of resent a comprehensive approach to 4 extracting meaning and value. exploiting what is known in order to gain 5 The difference between explicit knowledge insight, beneﬁciality and greater control 6 and tacit knowledge is crucial to an under- over actions and their outcomes. 7 standing of knowledge management. Arising • Knowledge management strategies repre- 8 from this distinction knowledge management sent useful approaches to gaining out- 9 theorists and practitioners maintain and build comes through knowledge discovery, 40 the need for a whole new approach to organ- transfer, sharing, utilisation and creation. 1 izational design and behaviour. • Knowledge may be derived from data, 2 Tacit knowledge is locked-in to the knower information, intelligence and above all 3222 and to many knowers in an organization. Thus from experience and learning. Different

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors tools, techniques, methods and principles cation practice. This will be assisted by the and circumstances are used (as method- incorporation of some studies of information ologies) to support strategies and man- and its management in programmes of train- agement. ing and education; the value of journalistic, • Knowledge management, knowledge advertising and similar media skills and train- strategies and knowledge methodologies ing is already acknowledged in corporate can operate in both personal and collec- communication. This awareness will enhance tive domains, and in the private and practitioner skills and in due course will raise public domains. a more strategic awareness of information professionalism in the field. Seeking highly structured, generalized and The ever more widespread use of the ICTs watertight definitions of knowledge and its in business and professional practice will re- practices is neither practical nor realistic. This inforce information use and personal skill in a view is consistent with the tacit, implicit, fuzzy, variety of ways: word processing, working soft, metaphorical, metaphysical, probabilis- with databases and spreadsheets, use of web- tic, sticky characteristics of the components of sites and search engines, experience with knowing and knowledge; the experiential, the multimedia and so on. Given the appropriate social, the embedded, the partial and the cir- settings and scales of activity, the further pro- cumstantial aspects. fessionalization of this usage and a perception of enhanced service based upon them will be seen as relevant. Support for the use of ICTs A programme for practice in can lead to a demand for better management information and knowledge of service and the provision of added value management and resource enhancing services. Corporate communicators need access to Suggestions for a programme in information professional support and expertise to deliver and knowledge management in corporate effective information management, but can communication are offered as a basis for prac- benefit from personal skill enhancement. tice. The themes presented are based on a module offered in a postgraduate course delivered to students of corporate communi- Information resources: producers and cation Thames Valley University (Roberts, users 2002). The information management model will function more effectively where there is greater Information management knowledge of the information resources (the raw material and content) and sources (the The preceding discussion has presented the forms in which the resources are held). Within main concepts of information management the corporate communication process strategic which form a foundation for knowledge man- and tactical advantages will be gained when agement. The first step is to acknowledge the both information and knowledge resources are importance of more formalized information developed and held more systematically at a management as a part of corporate communi- personal and organizational level.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Information resources provide the evidence cation skill combined with all the other requi- 2 base for the process (data, factual informa- sites of knowledge and practice in the field. 3 tion, published information, etc.) but the The assertion made in this chapter is that this 4 major drivers of corporate communication has to be supplemented with enhanced 5 will be intelligence and knowledge based, management capacities: these will be partly at 6 derived from both internal and external the personal level (in the form of the informa- 7 sources. The knowledge based information tion and knowledge aware practitioner) and 8 resource must also be managed; hence strat- substantially at the corporate level where 9 egies and tactics for handling implicit, hidden greater support will be beneficial. Individual 10 and individual knowledge are required. knowledge and information resources need to 1 The knowledge based resources show that be opened up for sharing and collective 2 the users and actors are themselves producers appraisal and utilization. 3 of further resource. Knowledge management Vital personal skills include knowing about 4222 has therefore to capture this resource, process information and needs and requirements, skill 5 it, store it and make it available through shar- in selecting and retrieving information, tools 6 ing, communication and demonstration and for building messages, selecting communica- 7 so on such that its value is realized. In this way tion channels fit for the task on hand, exploit- 8 existing knowledge will breed more knowing informal communication and formal 9 ledge. Management of this resource needs to information resources, and skills in oral, writ- 20 generate explicit evidence of the tacit and ten and visual communication. 1 implicit features of knowledge. Purposive 2 social and organizational communication, acts 3 of recognition, sharing, analysis, critique and Dissemination, projection and 4 exchange promote tacit revelation. Meetings, mediation 5 acts of recorded communication, archives, 6 databases, indexes, search tools and strat- These three functions are amongst the roots of 7 egies, intranets and other technology medi- public relations practice and have a propor- 8 ated communication form part of this process. tionate presence in corporate communication. 9 Vian and Johansen (in Ruggles, 1997) sum- By defining them as within the scope of 30222 marized features of the role of technology: information and knowledge management 1 intensive personal interaction, emphasis on their range of effect is extended. 2 the group, users working with producers, the Whilst the distribution of a press release is 3 valuing of chance encounters, asynchronous an act of dissemination so also is the wider 4 communication and asynchronous thought, scale of tackling the dissemination of know- 5 divergence, informality, and the acceptance of ledge within the group and between stake- 6 technology as a participant. holders. Vian and Johansen’s view of com- 7 puter mediated communication indicates the 8 more extensive scope and effects which can 9 Information and communication be secured through the use of technology to 40 skills manage knowledge. 1 The three functions are also roots of know- 2 Successful corporate communication is in- ledge management: dissemination requires 3222 dubitably about information and communi- sharing and exchange; projection considers

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors the wider tasks of disseminating knowledge etc.) may also assist in the formalization of and mediation acknowledges the wide variety approaches to knowledge management, but of processes through which knowledge per- there are limitations. Knowledge manage- meates and is received. Knowledge management needs more than external support and ment will support a collective responsibility technological support. It requires a fuller and and culture to exercise these functions and more active participation of those who work extract (leverage) value from what is known. with knowledge to exploit the potential for sharing and exchange – the bases for knowledge creation itself. This participation may Organizing information in practice become substantially based on supportive technology such as the corporate intranet, Whether acting in an individual consultant data and knowledge warehouses and combin- capacity or within the corporate role there is a ations of information and intelligence hand- need to organize information both in and for ling practice. Yet, it will only thrive on active practice. All professionals need to exercise participation of those involved. An intranet personal information management (corres- alone will not deliver knowledge manage- pondence, diaries, working papers, archival ment solutions: users have to be active con- papers, email, phone logs, etc.) and to tributors and active exploiters fulfilling both manage personal information needs (reading roles extensively. current documents, personal current aware- Models of information and knowledge ness needs, identifying current project inform- organization in any field have to move to ation requirements, etc.). active and participative mode. Knowledge With increasing task complexity and work- managers, as autonomous and trained spe- load personal information management may cialists, will be needed to share the burden prove insufficient and the symptoms of in- with the main actors rather than to substitute formation overload and personal stress for them. The corporate communicators have may become evident. In these settings sup- to take the responsibility for the professional portive and professionally executed informa- practice and solutions, but their burden is to tion management is indicated. This may take an extent shared with knowledge managers. the form of a sharing of information handling Burden sharing enables true professional burdens amongst colleagues and support responsibility to be carried. staff, but this may not be sufficient. Pro- fessional libraries and information services will support some of this burden on an out- ICTs and electronic environments sourcing or commercial basis, but given the nature and complexity of corporate communi- Corporate communication practice is being cation projects this is unlikely to satisfy. continually modified and influenced by the Dedicated information management support development of the ICTs. Its practitioners thus is the remedy at hand. have a significant responsibility to equip What can be used to underpin information themselves to use and exploit these tech- management (library and information ser- nologies to the full. At the personal level the vices, administrative and secretarial support, necessary skills are becoming part of education

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 and learning and are being diffused widely. Writing, editing and publishing 2 However, at the project and corporate level 3 the need to secure, invest in and access the Written communication has played an exten- 4 hardware platforms is a task of some magni- sive part in PR and is a substantial tool for 5 tude. The application of the technology corporate communication. Defining mes- 6 requires support and indicates the need for sages, crafting them with precision and target- 7 information strategies tailored to corporate ing them effectively are key skills. The sharper 8 communication and the development of and more professional these skills are the 9 information systems and management skills better. Corporate communicators need to 10 to comparable levels. appraise, critique and value the sources of 1 information they use in written communica- 2 tion: information awareness and information 3 Intelligence gathering and knowledge management play their part in this process. 4222 development The review of information constitutes a signifi- 5 cant part of the editing process and leads to 6 Intelligence can be gathered across the com- the formation of the messages to be com- 7 plete spectrum of communication and ex- municated through publishing, broadcast 8 change: it may be gathered deliberately and and presentation. These tasks require dealing 9 systematically (as in market and competitive with both content and format. Information 20 intelligence), circumstances may assist aware- management underpins the area of content 1 ness and interception (being in the right place whilst knowledge management underpins 2 at the right time), and it may be culled in a decision making about format, distribution, 3 serendipitous fashion (from a whole variety dissemination and assists evaluation pro- 4 of inputs, observations, conversations and cesses. The recruitment market in PR and 5 suchlike). Since the assembly of dissimilar corporate communication gives a good idea 6 and corroborative information and the scope about the centrality of these skills and profes- 7 for reflection and inference are vital parts of sional education programmes and training 8 intelligence gathering and work, it will be nec- should already provide the wherewithal. 9 essary to maximize actual and potential Improvements in information and knowledge 30222 information flows around events and to pro- practice should be sought to strengthen the 1 vide human resource and opportunity to underpinning and the results achieved meas- 2 analyse the evidence gathered. The cultivation ured through changing behaviour, impact of 3 of environments to generate these require- messages, acceptance, market positioning and 4 ments and opportunities should be part of the sustenance of identity, image and reputation. 5 information strategy developed around each 6 corporate communication problem. 7 Intelligence itself is one of the precursors of Networking and contacts 8 knowledge formation. There can be reciprocal 9 action between the two processes. Improved Knowledge activities have a strong social com- 40 knowledge may clarify the needs for both ponent and in corporate communication, a 1 intelligence and information. Intelligence field characterized by social exchanges, the 2 management supports knowledge manage- transition to knowledge based environments 3222 ment and vice versa. and activities would seem to be a natural one

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors to achieve. Rich networks of contacts form a Media and press relations and primary resource for knowledge building. practice But they cannot be assumed to provide lasting effectiveness, and therefore should be In public relations and public affairs the use of maintained and cultivated. The knowledge media, press relations and practice are central management culture of the kind sought and to the key processes. Within the strategic proposed for corporate communication vision, which is natural to and effective for should encourage this maintenance as a nat- corporate communication, media and press ural outcome of the adoption of the processes. relations have a relative and practical import- Corporate communicators need strategies ance in a tactical setting. But a common to sustain communication with stakeholders; framework of information and knowledge they need to track the development of net- management could, if developed in the set- works and register the resources in the form tings of practice, serve both complementary of indexes of expertise; social networks need specialities to good effect. to be treated as knowledge networks; for Information mediated through PR tech- longer-term productivity appropriate etiquette niques and released to the audience has to should be followed and networks need to be be of the highest standards of quality with reinforced, steered and sometimes influenced. respect to source, attribution, currency, accu- Since many networks and contacts are main- racy, perspective, objectivity and so on. It can tained electronically (which is convenient) the observe these criteria and yet still be persua- fundamental value of personal and face-to- sive by the way of crafting messages to meet face communication must still be maintained. circumstances and audiences. Networks of contacts should not be taken for The better management of the knowledge granted; reciprocity is essential. resource overall can assist in sourcing information, give confidence that the base of information used is unrivalled and ensure that the Strategy, policy and planning messages produced are fit for the purpose and robust enough to be defended should Even the individual consultant can find value in they face dissent, contingency or crisis. Good a more systematic approach to their informa- information is not just power but a source of tion and knowledge management. Personal public confidence. strategy is a valuable concept especially where it helps maintain a conscious approach to information needs, seeking and value. The Resourcing information and larger the group the greater the need for aware- communication activities ness of the acts of individuals and a collective strategy can encourage and support this. In this context resourcing refers to the finan- In larger groups with access to professional cial and budgetary dimension. In the real information support and management sound world of organizations the range of practice strategy needs to be developed and should and funding is wide. Once the essential goals provide a basis for identifying policies and of information and knowledge strategy and for planning information and knowledge policy have been clarified the funding impli- management. cations can be considered. Information service

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 professionals will be able to deal with the tion (and knowledge) activities as a source of 2 operational questions raised and make plans, expense, requiring appropriate resourcing 3 allocate resources and construct budgets (institutionally and/or individually) and poten- 4 according to the constraints. What has to be tially as an area for targeted investment. This 5 ensured is that the expected benefits are going resourcing of information will also serve to 6 to exceed the costs incurred. In this aspect lay down bases for knowledge processing 7 performance measures for information activi- and management. But, much of knowledge 8 ties and frameworks and methods for evalua- management is the utilization of accumulated 9 tion have a crucial role to play. capital in terms of human experience and 10 However, where tangible resources are knowledge. It may be substantially in situ 1 managed and information is well packaged in (in mente) and require greater expenditure 2 services, databases, documents, etc., the of time rather than money to extract. This 3 linear economics of information provision and resource then has to be mobilized by behav- 4222 resourcing can be managed in practice. On the iour and acts of will rather than through finan- 5 other hand the worlds of knowledge are non- cial expenditure. Data, information and some 6 linear and considerably flexible. Difficulties intelligence activities have to be specifically 7 are bound to ensue as the practice passes resourced, but much intelligence and very 8 from information processes to knowledge substantially the knowledge activities require 9 processes: from the explicit to the tacit significantly less expenditure to leverage and 20 environment. One way to deal with this in exploit. 1 practice is to treat the explicit information 2 environment as an overhead for the se- 3 quential production and management of Performance measurement 4 knowledge. That is to say that if the focus 5 of attention is adequately resourced from Corporate communicators have their own sets 6 the explicit side the tacit environment can of performance measures to determine their 7 function as a marginally costed activity. business success: these are not the concern of 8 Knowledge-seeking-and using behaviour is the present discussion. However, from an 9 not restricted by physical resources and capi- information and communication perspective 30222 tal, hence its identification as intellectual cap- the effectiveness of information seeking and 1 ital, inexhaustible brainpower. Know-what has information and knowledge management 2 direct costs but know-how is an indirect cost should be seen as a contribution to overall 3 (its overhead cost is infinitely spread) and has corporate communication effectiveness. 4 potentially limitless value. Information and knowledge delivery to the 5 Knowledge is thus an inherent resource: it right person, at the right time, in the right 6 does have to be extracted and there are some place in sufficient quantity and of excellent 7 costs involved in this process (tacit procedures quality must be a significant factor in corpor- 8 become explicit) but the ratio of value to cost ate communication. 9 is frequently going to be positive, although Haphazard information management and 40 still difficult to measure in monetary terms in insufficient leverage of knowledge are symp- 1 many cases. toms of individual overload and stress which 2 In operational settings of corporate com- can be ameliorated by stepping up informa- 3222 munication it is prudent to consider information support and professional assistance in

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors management of these resources. There are task is to maximize the value of the informa- many professional technologies and methods tion. Value can be conceptualized as resource- which can be used to improve information fulness and seen in terms of potential for and knowledge handling performance (organ- problem solving and decision making. The ized libraries and document collections, corporate communicator as information man- classification and indexing methods, retrieval ager has to identify and select the most poten- tools, databases, internet use, web technolo- tially resourceful information or to ensure that gies, mobile communications, personal in- it is provided for the task on hand. formation organizers, intranets, knowledge Information management has increasingly warehouses, expertise indexes and many developed around the use of computers more). Better information performance will and telecommunications (the information and be reflected in raised professional perform- communication technologies: ICTs). The inter- ance. net and the worldwide web represent the contemporary generation of these ICTs utilizing digitized input, hypertext, multimedia, Evaluation of corporate communication high-speed data transmission and broad activities bandwidth. Within and from this environment the vir- In the fullest sense evaluation is focused on the tual organization has evolved. In popular end user and the ultimate achievement of terms the dot.com enterprise, the e-business goals. Clients, stakeholders and publics will engaged in e-commerce. What consequences be the evaluators of the success of images, these new organizational forms will have for identities and reputations. It has been the corporate communication is still a matter of focus of this review of information tools and some debate. Is it a case of new technologies processes to indicate the range of possibilities grafted on the older organizational structures in information and knowledge management and models? Or is the model of the virtual which when used will support corporate com- environment radically different? munication activities and thereby achieve the Some factors are becoming clearer: maximum positive evaluations, measured by problems solved, satisfied clients, restored • Organizations and stakeholders are be- reputations, favourable publics and well coming more connected by using com- focused and growing organizational capacities. mon technological platforms. • Information circulation, communication and messaging has become more rapid: Information resources, value and good and bad news can travel more technology quickly to more people. • Technological diffusion has to some extent However important knowledge is, in the final created more players and in theory this analysis, its management is likely to be can create a more ‘democratic’ environ- founded best on good information management for corporate communication. ment. Whatever information resources are • The boundaries between corporate and identified and used in a corporate communi- personal/individual/private are being cation context the information management readjusted.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • Corporate society is becoming increas- ment of corporate communication theory and 2 ingly globalized by its use of new tech- practice in a substantial way. However, the 3 nologies. well tried and tested means of information 4 and communication activity will maintain 5 If information technology and information their importance. The choice of media may 6 management provide a catalyst for communi- have broadened but making the right choices 7 cation activity how is corporate communica- to use and practise is still going to require skill 8 tion to be managed in an increasingly and experience. 9 information and communication rich environ- Students and practitioners of corporate 10 ment? communication need to gain an understand- 1 The strategic perspective becomes increasing of information and communication prac- 2 ingly important and points towards some tice in the round at the level of personal skill 3 practical solutions for corporate commun- as well as an appreciation of its corporate 4222 ication. The development of information significance. 5 management strategies and policies can be The kind of programme of information 6 seen as a response for more effective corpor- management and knowledge management 7 ate communication in an informatized and reviewed in this chapter is a significant step 8 globalized world. towards developing a strong strand of profes- 9 sional information education in the corporate 20 communication field, drawing on the estab- 1 The way forward lished disciplines of information and know- 2 ledge management. 3 The impact of the information and communi- 4 cation technologies is shaping the develop- 5 6 7 REFERENCES 8 9 Askew, C. (2000) Database Retrieval Module Study London: Thames Valley University. 30222 Guide, London: Thames Valley University. Rowley, J. (1999) ‘In pursuit of the discipline of Leonard-Barton, D. (1995) Wellsprings of Knowledge: information management’, New Review of 1 Building and Sustaining the Sources of Innovation, Information and Library Research, 5, 65–77. 2 Boston: Harvard Business School Press. Shannon, C. E. and Weaver, W. (1949) The Math- 3 Nonaka, I. and Takeuchi, H. (1995) The Knowledge- ematical Theory of Communication, Chicago, 4 creating Company, Oxford: Oxford University University of Illinois Press. 5 Press. Stewart, T. A. (1997) Intellectual Capital: The New 6 Roberts, S. A. (1997) ‘The contribution of librarian- Wealth of Organisations, London: Nicholas ship to information management’, in J. M. Brealey. 7 Brittain (ed.) Introduction to Information Vian, K. and Johansen, R. (1997) ‘Knowledge syn- 8 Management. Wagga Wagga: Charles Sturt Uni- thesis and computer-based communication sys- 9 versity, Centre for information Studies, pp. tems: changing behaviours and concepts’, in R. L. 40 23–49, Occasional Monographs, 16. Ruggles (ed.), Knowledge Management Tools. 1 Roberts, S. A. (2002) Presenting Information: Intelli- Boston: Butterworth-Heinemann, pp. 187–208. 2 gence and Knowledge Module Study Guide, 3222

Kevin Moloney

Business, public and voluntary sector bodies, interest and cause groups can hardly avoid contact with government in modern, liberal, democratic, market-orientated societies. The combined pressures from pluralism of values and of behaviour ensure that contact is always a possibility and is frequently intense. This chapter looks at why and how these organizations and groups have to – want to – talk to government; and conversely why government regulates or ‘intervenes’ in civil society and the political economy. The chapter therefore looks at the context and practice of communication between corporate interests on the one hand and the most powerful communicator in the modern state, executive government, on the other by focusing on media relations (including ‘spin’); lobbyists and others.

A background to communicative Since the 1960s, the United Kingdom has action in liberal, democratic, witnessed great, observable changes in per- market-orientated, capitalist sonal behaviour by its citizens and in collective societies behaviour by voluntary groups. Jackall and Hirota (2000: 155) note that the greater and Is there a feature of modern societies which lesser tendency of people to come together encourages communication between business, ‘into “intellectual” and “moral” associations public sector bodies, voluntary organizations, for purposes of advocacy’ occurs in cycles interest and cause groups, and government? and they identify the 1960s as a ‘ﬂowering’. The argument here is that the increased plu- The personal behavioural changes derive prin- ralism of UK society (publicly expressed differ- cipally from altered values regarding sex, ences of values and behaviours) is the lifestyle, the environment, race, consumption stimulus. This pluralism takes two forms and and religion. They in turn generate social both involve more messaging to and from pressure for acceptance and tolerance of indi- government. viduals practising these new behaviours. This

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 pressure frequently leads to collective, group behaviours, but that these were publicized by 2 action by like-minded individuals to promote the new mass medium of television in a 3 and defend their choices. In this way, in- decade when social deference declined. 4 creased pluralism of values and groups has But what is the connection of this acceler- 5 been associated with social movements, e.g. ated pluralism with more communication, 6 feminism, gay rights, environmentalism, con- and with government? The link lies in the 7 sumerism, multiculturalism. These move- need of individuals for their new values and 8 ments are often distinguished by ‘contentious behaviours to be accepted or at least tolerated 9 collective action’ (Tarrow, 1994), such as sit- by society, and in the pressure on govern- 10 ins, media events, petitions, demonstrations, ment to react to these changes in civil society. 1 all designed to inﬂuence public opinion and One cannot be gay in an open way if homo- 2 government. Stonier (1989: 31) argues that sexuality is illegal: government is challenged 3 ‘Social movements are of prime importance to make same sex legal. One cannot be a 4222 to the PR practitioner’ and therefore her alter sovereign consumer without knowing, say, 5 ego, the corporate communicator. food ingredients: one would be a dead sover- 6 Voluntary associations springing from social eign consumer unless the government regu- 7 movements have a long history in the United lates for food safety. One cannot be an 8 Kingdom and it would be wrong to argue that informed citizen about the environment if 9 vigorous representation of group interests is levels of river pollution are not monitored and 20 new. There were the radical political clubs of then published. Employees want workplace 1 the late eighteenth century and Chartism in rights on health and safety, and on pensions: 2 the early nineteenth century. Trade unions, only government can enforce minimum stan- 3 co-operative societies and leisure groups such dards. Individuals and groups, in these exam- 4 as association football and the allotment ples and in numerous others seen each day in 5 movement grew throughout that century and the media, urge involvement by government, 6 into the twentieth. They also used techniques and representative, accountable government 7 which we today would call corporate com- responds in a liberal democracy. In this way, 8 munication or public relations. The Chartists communication between organizations and 9 collected millions of signatures in a petition to groups, and government express the concerns 30222 parliament and organized a mass demonstra- and hopes of the former and the policy 1 tion at Kennington, London, in the 1840s. responses of the latter. They are the conversa- 2 Two hundred unemployed shipyard workers tions of a liberal democracy. This shift in UK 3 from Jarrow organized an early special event society to more expression by individuals of 4 by marching three hundred miles to 10 different values and behaviours via voluntary 5 Downing Street. It was organized by the groups is identiﬁed here as value pluralism 6 National Unemployed Workers’ Movement. and group pluralism of a civic kind. Brought 7 See Black (1973) for the major involvement of together, they will be called civic pluralism. 8 the National Union of Local Government In addition to this kind, a commercial vari- 9 Officers in the 1948 foundation of the ant of pluralism has come to the fore in the 40 Institute of Public Relations. What happened United Kingdom in approximately the same 1 in the 1960s, however, was new: it was not so period. From the middle of the 1970s, it was 2 much that there were further public expres- noticeable that the climate of ideas about 3222 sions of unconventional, dissident values and markets and business was shifting away from

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors the collective and the planned towards the Implications for corporate singular and the autonomous. This altered communication paradigm for the UK political economy has resulted in business and pro-market interests The conditions are now set for a more varied, predominating over their ideological and competitive, argumentative and commercial- material competitors. Collectivism and corp- ized public life. It is an outcome which encour- oratism have waned while individualism and ages communicative activity as a means to ideas of small government have waxed. secure advantages for interest and cause Mainstream political parties vie to be more groups, for businesses, for public and volun- business-friendly. Competition is proclaimed tary sector institutions: and for government over monopoly; public policy favours con- to communicate acceptance or rejection of sumers rather than producers; markets see- change. It may seem a category mistake at first saw where the plan once stabilized; low tax to have public sector organizations as com- rates privilege private wealth over public municators with government. Are they not goods. As a result, there is now in the United part of government? Statutorily they are, but Kingdom a pronounced commercial plural- they have executive government as their ism. This is the condition where market and policy overlord and paymaster and they have business values, ideas and practices prevail to compete against civil service advice, party over substantial challenges from non-business factions, hostile stakeholders and the treasury or anti-business groups. Without it, acceler- for policy and administrative advantages, and ated pluralism would not affect the lives of all for resources. the UK population. Tens of millions are Accelerated pluralism (both civic and com- affected by personal and civic value changes: mercial) is an incubator of corporate and all are affected by market and business government communication. What do these changes. This commercial pluralism speaks trends tell us about the modern context in when we hear calls for the abolition of farm which corporate communication flourish? subsidies; when the gaming industry lobbies Pluralism is a competitive condition concern- for the use of credit cards in casinos, and ing groups of individuals in society. It is a con- when construction companies want to invest dition in which the ‘one’ has to compete for in NHS hospitals. survival amongst the ‘many’. Corporate com- Overall, the increased emphases on differ- munication are the symbolic and expressive ent values and personal behaviours, on volun- component of this competition and should be tary associations for their promotion and seen as competitive activity by transmitters defence (civic pluralism), and on the market- and receivers. The aim of the competition is able, the entrepreneurial, and the profitable the search for organizational advantage. It is (commercial pluralism) have combined to usually the case that only marginal advantage create a sustained pressure for change in pri- is available. Exxon is most unlikely to cause vate and public life. In liberal, market econ- the destruction of Greenpeace but it may be omies, popularly elected governments react able to win more public support over its rival to change in civil society (voluntary associa- in a particular campaign, e.g. the French tions outside the family and government) and courts upheld Exxon’s opinion that some in the political economy (the wealth creation environmentalists have amended its logo nexus in society). to give it a similarity with the symbol of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 the Nazi SS, and that this amendment liberal, democratic societies – anti-establish- 2 must not appear in France. Sometimes organ- ment thinking and street protests by marginal- 3 izational survival is seriously influenced by ized, anarchic groups. 4 communication: witness how a short, scato- Third, accelerated pluralism is not the same as 5 logical remark in 1991 by the eponymous neo-liberalism, the ruling conservative ideol- 6 chairman of Ratners ruined his high street ogy of much of the Anglo-American world 7 jewellery business. There are, however, limits since the 1980s. Apart from any coincidental 8 to the pluralist competition which prevent identity, they are separate: the pluralism 9 it deforming into a social darwinian struggle described here is a social phenomenon and 10 for survival at any cost: law, culture, and process; neo-liberalism is a philosophy. A neo- 1 ethics. liberal government may welcome pluralism 2 Second, UK corporate communication come as an agent for the expression of individual- 3 from many different types of organization and ism and free association, but it would also 4222 group. Modern British pluralism is a highly note that pluralism is a process of interest 5 variegated and pervasive phenomenon across intermediation and that many of these inter- 6 its civil society and political economy. ests are inimical to a neo-liberal government. 7 It would be inadequately descriptive to For example, environmentalism and con- 8 narrow the term ‘corporate’ just to business. sumerism have flourished during the period 9 Friends of the Earth, the Trades Union Con- of accelerated pluralism, but they are viewed 20 gress, and Help the Aged are as structured, with suspicion by the neo-liberal as imposed, 1 hierarchical and stable as McDonalds, the external costs on markets, and as the cause 2 Institute of Directors and EMI. Churches, syn- of increased government regulation. Some 3 agogues and temples are more communica- industries have ambiguous, if not hostile, atti- 4 tive than many boardrooms. Think of the tudes towards free trade. For example, the UK 5 Board of Deputies of British Jews and the drinks and tobacco trade towards wine and 6 Catholic Media Office. The professional associ- cigarette allowances for holiday makers, and 7 ations for teachers, nurses and police speak to British farmers towards cheap food imports 8 the media and lobby government as often as by supermarkets. Pluralism allows views to 9 many industry and trade associations. The countervail each other, without regard to con- 30222 definition here of ‘corporate’, however, does sistency with neo-liberal values. 1 not include anti-globalization, anti-capitalist The fourth contextual point is that corporate 2 groupings. Corporate communicators from communication is, mostly, public activity, even 3 many sectors are concerned about messages though its subject matter is sometimes about 4 from them, respond to them, and study their private behaviour. Corporate communicators 5 techniques, but the anti-globalizers are not are known and accountable officials for their 6 the subjects of this chapter as their spokes- organizations and their work is trackable 7 people are often anonymous, often speak for (mostly). Corporate communication is the 8 themselves, and the fluid combinations of public relations of communication: public 9 activists around them lack a stable organiza- communicative relations of display-for-atten- 40 tional basis. But this exclusion of anti-globaliz- tion-and-advantage aimed at a distinct public 1 ers as corporate communicators does not ‘other’. Corporate communication sometimes 2 deny the importance of their messages. They deal with private matters but mostly in a 3222 come from another important tradition in public way. For example, the pay rise of an

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors individual business executive causes contro- are in continuous exchange with each other versy but it is defended in terms of policy, if (e.g. trade unions and employers) but those not principle. An individual farmer sows bilateral messages mostly exclude govern- genetically modified seed, but her critics ment and are not directly dealt with here. The attack the sowing in terms of perceived public third location is markets in the usual sense of welfare. There are exceptions to the publicly the term and in the less usual sense of institu- known content and delivery of corporate tions concerned with markets (e.g. market communication. They fall under the com- makers such as stock exchanges, and private munication category known as lobbying and and public regulators). This location includes they do raise questions about the trans- marketing communication about goods and parency and accountability of behaviour by services, and messages about corporate life powerful interests and government in published by stock exchanges, regulatory modern, liberal democracies. bodies, government departments and by As most corporate communication, by accountants. The profits and losses, invest- volume and frequency, is public, the media is ments and factory closures of car makers, the major channel for the distribution of corpor- and the statements about model recalls are ate communication. This is the fifth contextual corporate communication. This marketing and point. market communication is a focus of this chap- The sixth is that it is important to identify ter. the social locations where communication It is important to realize that much corpor- between interests and government is ex- ate communication takes place in locations changed. There are three exchange loca- where government is not involved (civil tions for corporate communication. The first is society) or is only involved in a supervisory the media, both old and new, where com- way (markets), and that this is usually communication between interests and govern- petitive communication – done in public ment is in the mass media and this location is mostly, between allies and critics. It is a a major focus for this chapter. The second reminder that corporate communicators should location is civil society which includes the always know who their audiences are – the churches, universities, the professions, trade intended and unintended; the friendly, hostile unions, cause groups, sporting organizations. and neutral; one decision maker or the mass. Civil society is a term made to bear many Government, however, will become interested meanings (e.g. educated as opposed to unin- in these exchanges of views when they gener- formed society; the site of ideological produc- ate politics, i.e. when the actions or words of tion in capitalist society; the liberal alternative competing interests affect public policy or to totalitarian society), as discussed by Kumar mass public opinion. An example is the com- (1993). He indicates that the majority British petition between traditional and low-cost air- and American usage locates civil society as an lines: at some stage, the government will be area of social activity separate from govern- involved over the allocation of takeoff and ment, where there is freedom of association, landing slots. The reference above, moreover, and which excludes the private lives of indi- to ‘hostile’ audiences is a strong reminder that viduals and of families. Corporate communi- corporate communication takes place in an cators for the various interests in civil society ideological context and that it is being

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 monitored by critics, if not enemies. This and powerful professional groups communi- 2 scrutiny lays a research role on corporate cate with government. 3 communicators. The contemporary period, 4 for instance, is well worth analysing by 5 communicators for there may be a more Why government communicates 6 critical attitude to capitalism developing 7 (Klein, 2000; Monbiot, 2000; Hertz, 2001; Accelerated pluralism, which has been identi- 8 Lubbers, 2002). fied as the social stimulus for the increase in 9 The seventh contextual point is the internal corporate communication, has a business; 10 position of corporate communicators inside public and voluntary sector; interest and cause 1 their organizations. These professionals are group basis. It is the CBI, Virgin Trains, British 2 involved with just one corporate resource – Airways talking from the capitalist and market 3 the symbolism of words, visual design, sound, corners of UK national life; it is the Con- 4222 and, sometimes, employee behaviour. They sumers’ Association, the Citizens’ Bureaux, the 5 work alongside product designers, engineers, weights and measures departments of local 6 accountants, marketeers, fundraisers, plan- authorities talking for consumers; teachers, 7 ners and fieldworkers responsible for other social workers and Age Concern talking for the public and voluntary sectors; the RMT 8 corporate resources. This is a reminder that 9 trade union talking for train and station crews. corporate communicators deal only with com- 20 This pluralism creates a great river of self- munication: they use symbols to represent the 1 promoting, biased, repetitive communication, beliefs, policies, outputs and behaviours of 2 some well founded, some not (media their organization. A modesty is needed here 3 releases; roadshows; briefing notes; exhibi- for there is a professional deformation in 4 tions; conferences; websites; marches; peti- some spokespeople: because they write and 5 tions, videos). Why should government pay talk for the whole organization, they can 6 attention to this accelerated pluralism? 7 delude themselves that they control its many From the government’s perspective, the 8 functions. Instead, they are reliant on their answer is threefold. There is the nature of 9 colleagues for the data, knowledge, goods democracy as a set of ideas (including repre- 30222 and services out of which to make effective sentation and accountability) about the 1 communication, a task onerous enough in its governance of people; and then the institu- 2 own right to encourage professional modesty. tional arrangements (elections and secret bal- 3 Professional communicators cannot com- lots) which turn those ideas into political 4 municate without the ‘raw material’ of other behaviour. Third, there is a particular form of 5 professionals. pluralism which causes government to 6 The final contextual point concerns Grunig respond: the material and ideological power 7 and Hunt’s (1984) categorization of public of business in capitalist political economies, a 8 relations, still probably the paradigmatical power which is reflected in the rise of the 9 typology of corporate communication. Two- commercial pluralism described above. The 40 way asymmetrical communication is mostly early American pluralist writer Truman (1951: 1 done by large organizations when dealing 37 and 256) noted that business is a high- 2 with their stakeholders: two-way symmetrical status group with much access to government 3222 communication is found when big business while ‘labour organizations’ had less access

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors due to ‘handicaps in status’. Dahl (1961: 76) such as ‘public affairs’, ‘communication’, calls business people ‘economic notables’ and ‘information’, ‘public relations’, ‘government observes that ‘their authority is particularly relations’, ‘corporate relations’ being com- great when policies impinge directly on busi- mon; and with government and the non- ness costs, earnings, investments and profits’. commercial sectors showing a preference for Marsh and Locksley (1983: 1–21) judged ‘information’ and ‘communication’. These that the power of capital was ‘qualitatively corporate professionals work with senior as well as quantitatively different’ from other decision makers as planners, executives and groups. Dunleavy and O’Leary (1987: 293–7) advisers. It is this coalition of functional wrote that ‘business interests occupy a communicators plus the dominant coalition position of special importance compared with inside an organization which ‘do’ its com- other social interests when it comes to influ- munication. The values, knowledge, skills and encing public policy-making’. The neo-plural- attitudes needed to be a corporate communi- ists Lindblom (1997) and Smith (1990) argue cator are well set out in various texts (Oliver, that elected governments and business need 2001; Theaker (ed.), 2001; Heath (ed.), each other to produce prosperity and employ- 2000; Harrison, 2000; Kitchen (ed.), 1997; ment. (See Held, 1996: 215–18, for a succinct Van Riel, 1996; White and Mazur, 1995). summary of neo-pluralism.) Business people What can be distilled from this professional need skilled employees and consumers with practice of communication are some underly- disposable income in order to make a profit. ing elements on which the superstructure of Governments need satisfied voters to vote for professional practice rests. First among these them. Politicians would be other than repre- elements is issues management – the organ- sentative and accountable – and other than izational response to matters in the operating elected – if they do not listen and reply. environment which can be either opportuni- The neo-pluralist perspective outlined above suggests that business communicators ties or threats. An example is a UK govern- will be listened to more than others. Another ment consultation paper (July, 2002) to build author on pluralism, meanwhile, has cali- four more runways in the south east of brated the potential any group has for being England: an opportunity for British Airways; a listened to. Grant (1995, 2000) puts interest threat to environmentalists and country life and pressure groups on a scale between ‘in- enthusiasts such as the Council for Protection siders’ (much access and influence) and ‘out- of Rural England (CPRE). The classic role of siders’ (little) and he concludes his 2000 corporate communicators in issues manage- analysis of ‘insider’ influence with pessimism ment is: to scan the boundary of the organiza- about the future predominance of democracy tion to spot issues; to research them; to plan over special interests. with others an integrated response by the organization, and then to communicate to stakeholders, government and the general How do organizations public what that response is. Issues manage- communicate with government? ment developed in the 1960s in the United States as a business response to a hostile The professional cadre employed to com- reform agenda from environmentalists, municate are variously titled, with descriptors workers’ rights campaigners, and consumers

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 (Nelson and Heath, 1986; Heath and • an ongoing media relations campaign 2 Cousino, 1990) but is now a strategic plan- which publicizes the above when it 3 ning technique used widely in and outside favours the Council’s cause; 4 business. Heath and Cousino argue that it • an advocacy advertising campaign, 5 has developed from a ‘decide, announce, backed by direct mailings and tie-ins 6 defend’ mode to a ‘dialogue, decide and where appropriate. 7 deliver’ one. After this primary task of issue 8 analysis and policy response, the next under- With an issues management policy and a com- 9 lying element is a purely communication one: munication plan in place, the organization or 10 the communication plan. group is ready to talk to government. The 1 To develop further the example above of operational style, however, should be cautious 2 more runways, the communication goal of the for elected governments backed by a popular 3 CPRE could be (on an illustrative basis only): mandate and a stable parliamentary majority 4222 to persuade government to use existing capac- are powerful. There are various points of pru- 5 ity more intensely instead of building extra dence to consider before speaking to 6 runways. Communication tactics to achieve Whitehall and Westminster whether publicly 7 that goal could include: through the media and staged events, or pri- 8 vately through lobbying. 9 • a communication alliance with other The organization first has to consider 20 friendly groups against more runways, whether what it does and says is socially 1 e.g. Friends of the Earth, local residents’ responsible, namely that its policy serves the 2 protest groups, local councils; national interest as well as its sectional inter- 3 • identification of supportive, hostile, and est. Governments invariably talk about gov- 4 neutral Members of Parliament in areas erning in the national interest, and they say 5 likely to be affected; that they weigh proposals in its light. There 6 7 • a lobbying campaign aimed at these MPs was, for example, no point in trade unions 8 above, and, more importantly, at senior trying to argue with Thatcher governments in 9 civil servants and ministers who will take the 1980s that the right to secondary picket- 30222 the final decision; ing should be enshrined in law. Organizations 1 • the production of a brief for these politi- must, therefore, avoid being denied access 2 cians and officials in written, website, and influence by government because they 3 email, video, forms; are perceived only as promoting a self-inter- 4 • a briefing of senior media editors and est. An organization will know, indirectly, how 5 journalists covering the proposal by way they are perceived if they have direct access 6 of regional, local and specialist publica- to government decision makers; if they are 7 tions, e.g. planning, environment, air asked for their views on consultative papers, 8 travel; and are asked to sit on technical committees 9 • liaison with academics, think tanks, indus- and task-forces. If the answer is ‘yes’ to these 40 try experts publishing views supportive of involvements, the organization is an ‘insider’ 1 the CPRE position; group as defined by Grant (1995, 2000). To 2 • liaison with celebrities and local notables stay an insider group, organizations must align 3222 who are supportive; their sectional interest with the government’s

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors definition of the national interest in their field, government is that businesses seeking to or they must at least persuade government persuade government need to be aware of the that the two are aligned. One policy maker policy and value environments in which the put the official search for the larger interest ruling political parties conduct their politics. this way: ‘The civil servant’s job is to under- A detailed awareness of major policy stand what is going on out there [in the non- commitments is needed in order to frame governmental world] and the art really lies in proposals so that they go with the grain filtering out the naked self-interests in the of government thinking. Such an awareness points that are being made because . . . that is is a necessary condition for successful com- how policy is formulated’ (Moloney 1996: munication with those more powerful than 125). the message sender, whoever they are. When governments talk of the national Governments should not be confronted or interest, they often encourage some organiza- confounded on their ideology, or their elec- tional behaviours rather than others. Contem- tion manifestos. Corporate proposals are per- porary UK governments, for example, support suasive when they reinforce major policy, ideas of corporate social responsibility by making it more effective or steering it around business. The core idea here is that companies unforeseen difficulties. For example, New defer immediate gains of, say, profit or cost Labour was committed in its 1997 manifesto cutting in the short term in order to benefit to increasing the representative rights of trade stakeholders: companies do this in the hope unions in the workplace, and it won the elec- that they will generate more sales or more tion that year with a House of Commons good reputation in the longer term. An exam- majority of 187. Business interest groups were ple is the former nationalized British Gas fund- not going to stop that legislation: instead the ing village halls in areas where pipelines were Confederation of British Industry (CBI) made laid. The government has a junior minister for its case against more rights in terms of the corporate social responsibility (CSR) and it threshold percentage of trade unionists in a supports the work of the promotional group workplace required before representation Business in the Community which in turn is rights were granted. The implication was that supported by the Prince of Wales and by collective rights cannot be given unless there many blue chip UK companies. Whether CSR is evidence of widespread support for them. is a proper business activity is argued by eco- Thus, a technical proposal can sidestep politi- nomic liberals (Halfon, 1998; Henderson, cal confrontation and open up space for nego- 2001) in the tradition of Milton Friedman tiating an advantage. How this is done is a (1962) who thought that diversions from valuable communication skill. US lobbyists for profit maximization were irresponsible. Hilton Japanese car makers selling into the United and Gibbons (2002), on the other hand, States showed it in abundance when they got argue that CSR should be further developed lightweight trucks reclassified as cars in 1989 into corporate social leadership whereby busi- and saved their clients $500m in tax per year ness gets involved with the delivery of social (Moloney, 1996: 16). Where you know that services to the benefit of the larger commun- your corporate interest is opposed by govern- ity and themselves. Whatever the merit, the ment, discuss technical matters with senior second point of prudence in approaching civil servants and ministers, especially when

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 they have large majorities. (Most of this tech- face-to-face with government and not through 2 nical argument is done by lobbying, a private the media. Lobbying is ‘monitoring public 3 form of corporate communication described policy-making for a group interest; building a 4 below.) case in favour of that interest; and putting it 5 Status of personnel and organizational size privately with varying degree of pressure to 6 are other matters for prudence when present- public decision-makers for their acceptance 7 ing to government. Ministers and senior civil and support through favourable political 8 servants expect to see chairpeople, chief exec- intervention’ (Moloney, 1997: 175). It is done 9 utives and finance directors when they are by organizations with their own staff or with 10 being lobbied. The corporate communicator hired-in, commercial lobbyists, working for a 1 would be unwise to present alone: he should fee. Lobbying has become more 2 be there as part of the corporate team, should of a high-risk activity after the ‘sleaze’ scan- 3 not speak, and should be present as note- dals of the late 1980s and early 1990s; 4222 taker and as prompter of the corporate scandals involving MPs (most notoriously Neil 5 memory. No demotion in any of this: her role Hamilton) and hired lobbyists (Ian Greer). 6 has been played out beforehand in arranging These shone an unflattering spotlight on 7 the meeting, its agenda and writing briefing lobbying by businesses and other powerful 8 papers. As a general rule, ministers and their interests, and led to the appointment of a 9 advisers will not see small businesses or Committee on Standards in Public Life (the 20 organizations unless their proposal happens to Nolan Committee). Nonetheless, lobbying is 1 embody some very specialist concern, or an a modern expression of the medieval right 2 MP has made a strong case for such a repre- to petition the sovereign and to seek redress, 3 sentation. This is where trade bodies become and if it is done ethically and within the law, it 4 agents for corporate communication: their is acceptable corporate communication. It is, 5 role is to represent small and medium sized moreover, done by a wide range of less 6 firms (as well as large ones), and to aggregate powerful interests outside of business but if 7 opinions into an industry-wide view. These the reader takes the neo-pluralist perspective 8 trade bodies often seek examples and testi- on the competition among interests in 9 monials to illustrate their points in their media modern states, the extent of business lobbying 30222 releases and this is how small organizations is evidence for that view. Miller (2000) and 1 can be identified. Curry (1999), a former minister, have written 2 authoritatively on how it can be done by 3 business and non-business interests. 4 Corporate communication as The prevalence of lobbying makes it fitting 5 lobbying to identify some contextual factors which 6 influence the practice of lobbying and its out- 7 Most of the communication outlined above is comes. If it is always ill-advised to try to per- 8 delivered in public, either to small audiences suade government to make policy against its 9 at conferences, exhibitions, seminars, road- core values, there is one circumstance which 40 shows, or through the mass media. But some makes governments less clear about what 1 communication is done privately with govern- their core values are: a small majority in the 2 ment under the heading ‘lobbying’. This is House of Commons which is split and cannot 3222 corporate communication as direct action: be relied upon to always vote with their party.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors This was the case with the Major government, How do governments 1992–7, which started with a majority of 30 communicate with organizations? MPs, and ended with 8, and whose sup- porters were split on European policy. MPs in Executive government is a powerful profes- a governing party with a small majority can sional communicator in modern states like the lever up their influence on lesser policies if United Kingdom. Indeed in Britain no other they promise votes on policies vital to the communication set-up can come close to its government’s survival. In these circumstances, quantity and quality of output. Perhaps this is the corporate lobbyist can advance her case as it should be for the government draws its through contact with MPs but she will know news-making mandate from its elected author- that when parliamentary majorities are high, ity. It also manages the fourth largest economy persuasion is more effective when aimed at in the world and exercises a global diplomatic ministers and senior civil servants. (See and military role. Its communicative power is a Moloney, 1996: 96–7, for the witness of a reminder to organizational communicators to hired lobbyist.) be prudent in dealing with it. Whatever the size of a parliamentary The British government employs a thou- majority, corporate lobbyists should calculate sand professional communication specialists. how specialized and extensive their know- Over four hundred do media relations and ledge is in areas where government makes over two hundred publicity and marketing. policy: government needs personal access to They are mostly in London and based inside experts to make viable policy. A senior civil the government functions they serve. The two servant put it this way: ‘It’s wrong to assume Blair administrations have extended the that Government or bits of Government power of the centre over these civil servants instantly know their way round the economy, by having twenty information strategists at 10 around the public life in the UK: they don’t. Downing Street scheduling a continuous flow Even less so when it comes to Brussels . . . and of government news. They work upon a it is a value to a thoughtful civil servant . . . to planned ‘grid’ of news releases and comment, build up contacts so that when a problem often with hourly updates, to a 24 hours arises . . . you can ring up someone . . .’ media, 365 days a year. The power of this (Moloney, 1996: 125). Finally, the ‘naughty news supply attracts a specialist group of jour- but nice’ image of lobbying will not beguile nalists (the Westminster press lobby) dedi- the prudent corporate communicator with cated just to reporting it, and to developing prospects of easy success for she will know non-official and anti-official versions of it that governments with large majorities are (called ‘exclusives’, ‘scoops’ and ‘leaks’). The very powerful, and that for every successful government avoids these metropolitan jour- lobbying campaign, there is a failure. A good nalists from the ‘Westminster village’ having corporate reputation can easily be squan- monopoly power over delivery of this news dered. It can be maintained by following what supply to audiences by the prime minister the Nolan Committee listed as the seven prin- briefing the press on television (e.g. 25 July ciples of public life: selflessness; integrity; 2002), and by dealing directly with the objectivity; accountability; openness; honesty; regional and specialist media. leadership. The middle five have particular There are also among the eighty ministerial relevance for professional communicators. special advisers some who specialize in media

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 relations. These political appointees give tion) such as no-drink-drive, road safety, stop- 2 ‘policy steers’ to the official information teams smoking. 3 in their ministers’ departments, and they These thousand civil servants are the offi- 4 sometimes speak directly on more party cial communicators of government, and corp- 5 political matters to the media. It is no sur- orate communicators will have multi-faceted 6 prise, therefore, that the government’s chief relationships with them: analysing their offi- 7 professional communicator is considered cial statements; judging how to respond, and 8 more powerful than many cabinet ministers. collaborating on news about joint ventures 9 (The BBC2 television programme News from (e.g. public/private investment initiatives to 10 No. 10, 15 July 2000, provides insight into the build hospitals and service railways; running 1 thinking of both journalists and official com- failing schools). But alongside this official 2 municators in the time of Alastair Campbell as structure of communication and civil servants 3 the prime minister’s press secretary.) It is also lies politics and elected politicians, producing 4222 no surprise that when this well-resourced another stream of communication. MPs and 5 news management system breaks down, it is ministers talk to journalists in the Lobby of the 6 news in itself. (The controversy between spe- House of Commons as well as in their con- 7 cial adviser Jo Moore and official director of stituencies and in departments. We can say 8 information Martin Sixsmith in the transport that government has two communicat- 9 department made headlines in spring 2002, ion systems and while the constitutional 20 and contributed to the resignation of a secre- position is that the elected politicians manage 1 tary of state shortly afterwards.) The UK the civil servant communication, there is no 2 government has become more communica- guarantee that the two systems are giving 3 tion conscious under the Blair administrations. out the same messages. This is a reminder that 4 This is observable in three ways: there are government and politics are a ‘messy busi- 5 6 more ministerial special advisers dealing with ness’ often lacking the consistency of the 7 the media; there is strong central control, and bureaucratic organization. This message of 8 a planning ‘grid’ delivers news to all media confusion and ‘noise’ in transmission channels 9 outlets all the time. An emblem of this is another reason for prudence when dealing 30222 strengthening of official communication is with government. The messages coming from 1 a new name for the service. After the it may be conflicting; are often not trace- 2 Mountfield report (1997), it altered from able to source, and are sometimes conflicting 3 ‘Government Information Service’ to on purpose for tactical political reasons. An 4 ‘Government Information andCommunication example is messages about UK environmental 5 Service’ (GICS). GICS includes the Central policy. One middle-ranking minister was 6 Office of Information. This is the government’s reported to be critical of New Labour’s 7 own advertising agency and manager, public- achievements in the area while his senior 8 ity agent, special events organizer, and public claimed that the first minister had not been 9 relations consultancy rolled into one entity. It critical, but had been mis-reported, and that 40 brands itself on its website as ‘government’s there were identifiable achievements. This 1 communication expert’ (August 2002). It is ‘confusion’ sends different signals to business 2 involved with public information campaigns interests and environmentalists who are com- 3222 (communication campaigns for citizen educa- peting for advantage on policy benefits.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Public silence, private analysis and private The word, however, has taken on a linguis- lobbying is the best communicative response tic life far beyond politics. It is now a pejora- by those outside government. Much to be tive term for any public relations, corporate avoided is the charge that corporate interests communication, advertising or any publicity are ‘interfering in politics’. disliked by the speaker or writer. Usage has spread even beyond professional territory and into personal relationships: it now conveys Spin and what to do with it dislike of any conversational statement not to the listener’s liking. The cause of this popular- The term ‘spin’ is a fashionable one, current in ity is linguistic in that the word has become an the United Kingdom since the 1990s at least. easily understandable and culturally rich The favour it finds amongst politicians, how- metaphor in the United Kingdom. It aligns ever, decreased from 2000 because the the popular image of the wily politician with approach to news management it represents that of the crafty spin bowler in a cricket has serious disadvantages. Instead the term match who is trying to beat the good, honest and the approach have themselves become yeoman of a batsman defending his wicket. politics. What was once the transmission The word, however, originated in American system for the story has become the story, and baseball and was 1980s jargon for coaches not one reflecting favourably on elected training pitchers to make the ball turn in mid- politicians. air in order to confuse the hitter. The trans- Spin is the current dominant style of politi- ferred meaning into political, corporate and cal (as opposed to official civil servant) pre- personal affairs, however, whether in America sentation in the United Kingdom and Gaber or the United Kingdom, is still the same: (2000) offers an analysis of its features. It is an to ‘spin’ is to describe a policy, personality or aggressive, demeaning, exaggerated and event with a gloss which the listener disagrees uncivil style of presentation used by politi- with. You spin what is wrong but I advance cians against the media, and indirectly against what is right. other politicians. Rosenbaum notes (1997: For all reasons, corporate communicators 91) that when political press officers were may be the subjects of spin from government informally called spin doctors, the change when they deal with the state (car makers as denoted a more active, challenging, and hec- ‘rip-off Britain’; trade unionists as the ‘enemy toring behaviour towards the media. In its within’; banks for making ‘windfall profits’). contemporary UK form, spin is aggressive, Though they may be objects of the spin accu- political public relations developed by New sation from government, they should never Labour to counter hostile media coverage themselves employ spin. A corporate cam- from the right-wing press. It is a euphemism paign may be assertive in that it claims truth for propagandizing and therefore tends to for its view but it should show respect, through degrade democratic politics. Politicians should intent and language, for the views of its inter- put their spin doctors on half-time contracts – locutors. It should be reasoned persuasion. if not sack them altogether – and rebalance It should not use hyperbole of fact or argu- their time and energies in favour of policy ment or emotion in its messages or behaviour. substance, and more statements in parlia- It should treat the media and the ultimate ment. message receivers in a civil manner. Not to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 communicate in a civil manner is demeaning and Golding (1994: 3–4) have written 2 for the corporate body and reduces reputa- about the rise of the ‘public relations state’, 3 tion. It should follow what Susskind and Field giving the size of the government’s advertis- 4 (1996) have called a ‘mutual gains’ approach ing spend and of its information service as 5 when communicating with an angry public. examples. 6 Applying this approach to government and But there is a naivety in the constitutional- 7 corporate bodies would produce communi- ist’s position set out above. It assumes that 8 cation marked, inter alia, by: shared concern; constitutional rules and conventions in a 9 joint fact finding; shared responsibility for democracy capture and contain power rela- 10 the task in hand; trust; and a long-term relations in favour of the many. The Marxist left 1 tionship. argues that constitutions do capture these 2 relations but in favour of the privileged few, 3 not the unpowerful many: Marx called the 4222 Who has the balance of advantage nineteenth-century state the executive com- 5 in corporate communication? mittee of the capitalist class. Economic radi- 6 cals like Dahl and Lindblom (both American) 7 A constitutional answer is that the balance of argue that, whatever constitutions say, the 8 advantage, defined as the last word on policy business interest is the most powerful one in 9 in a democratic state, should lie with the societies like the United Kingdom and 20 elected government. Such governments, espe- America, and their neo-pluralist perspective 1 cially centralized ones such as the United (see above) suggests that government has to 2 Kingdom’s, are very powerful. They are negotiate with the business interest. From this 3 leviathans, but perhaps democratic ones. perspective, business communicators have a 4 Since the 1980s, British governments have powerful message to deliver to government 5 dismantled the industrial public sector; re- and they do hold the communicative advan- 6 duced the power of trade unions; favoured tage on some key issues. When the Con- 7 markets over monopoly and cartels; intro- federation of British Industry, the Institute 8 duced the ‘big bang’ of competition into the of Directors, and the Engineering Employers’ 9 City of London; reformed the education Federation talk about, say, deregulating 30222 system, and introduced regulation in all these labour markets (weakening the bargaining 1 areas of national life. Corporate interests in power of employees), or graduate skills for 2 the private, public and voluntary sectors have the workplace (more portable core skills), 3 not halted this policy flow: they have only the British government listens. But the neo- 4 shaped its margins. The constitutional citizen, pluralists attribute this strong negotiating 5 individual or corporate, may not like it but has position to the business interest taken as a 6 to accept it as the consequence of elected whole, and not to individual industries, firms 7 government. or particular business personnel. Thus chief 8 Government communication – in structure, executives and accountants will find their 9 volume, frequency and content – reflects the ethical behaviour more regulated following 40 powerfulness of their political sources. the American accounting frauds; the British 1 Indeed, so powerful is government communi- coal industry will face declining state sub- 2 cation in the United Kingdom that they have sidies, and British clothing manufacturers will 3222 been paid a dubious compliment: Deacon not be protected from cheap Asian imports.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors The tension between these perspectives is • Communication is done to procure ad- another reminder of the need for prudent vantage for the organization. judgement when corporate interests – private, • Without knowing policy and political public and voluntary – communicate with contexts, communicators are less effec- government. There is first the question of tive. whether the corporate communicator has the • These communicators include those in technical competence to deliver a persuasive public and voluntary institutions, and the message to the most powerful listener in the full range of stable interest and cause state. Are you communicating a position groups as well as in business. which aligns your interest and government’s • According to the neo-pluralist perspec- definition of the national interest? Have you tive, business communicators are in a identified the most persuasive mix of message privileged position vis-à-vis government, forms and channels? Are you communicating but one that is challenged and not always publicly or privately or in both modes? Will on the winning side. you be listened to alone or as part of a larger • Elected governments are the most power- interest? Are political and official channels ful communicators in these societies. giving you the same messages? • Most corporate communication is public These questions are the tactics of communi- but some are private and this lobbying cation with government: the strategic ques- raises accountability and transparency tions still needed answering as well. Where questions about dealing with govern- does your interest lie in the scale of government. ment imperatives and favoured policies? • Governments communicate in both politi- Do elected politicians gain or lose votes by cal and official channels. communicating with you? Are you an insider • Be prepared and prudent when communi- or an outsider to the business of running the cating with democratic government. country? Your communication can propose but government’s invariably dispose. CorpComs: tracking and analysis

What have you learnt? Corporate communication pervades our public messaging spaces (the media, websites, Readers will have noted the following points ofﬁcial documents, face-to-face debates) and to aid better understanding and practice: is easy to track. The strategy and tactics behind it are, however, more difficult to • Corporate communicators talk publicly analyse. and critically to government in liberal, Businesses, public bodies, interest and democratic, market-orientated, capitalist cause groups are always seeking communica- societies. tive advantage vis-à-vis competitors and • They communicate in a societal context government, and a continuous, thoughtful with distinctive features, chief of which is scrutiny of their communication reveals a high degree of competition amongst organizational aims and objectives. Here are interests (accelerated pluralism). three tracking exercises.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 1 What communication comes from your Can you identity government’s policies 2 employer or industry/trade representation and if they have changed over time? How 3 body? Specifically, identify the messages; do these policies relate to the organiza- 4 how they are channelled to government; tions you support on the issue? 5 and why they are sent. 3 Take a policy of government which you 6 2 Discover government’s communication oppose. Identify the businesses or interest 7 on an issue which interests you. Search and cause groups which are critical of that 8 the websites of the sponsoring ministry, policy and devise a corporate communi- 9 parliamentary reports, and interested cation plan for them. Compare your plan 10 MPs. Follow political reports in the media. with theirs. 1 2 3 4222 REFERENCES 5 6 Black, S. (1973) The Institute of Public Relations Held, D. (1996) Models of Democracy, Cambridge: 7 1948–73: The First Twenty-five Years, London: IPR. Polity. 8 Curry, D. (1999) Lobbying Government, London: Henderson, D. (2001) Misguided Virtue: False Notions 9 Chartered Institute of Housing. of Corporate Social Responsibility, London: 20 Dahl, R. (1961) Who Governs?, New Haven: Yale Institute of Economic Affairs. University Press. Hertz, N. (2001) The Silent Takeover, London: William 1 Deacon, D. and Golding, P. (1994) Taxation and Heinemann. 2 Representation: The Media, Political Communication Hilton, S. and Gibbons, G. (2002) Good Business: Your 3 and the Poll Tax, London: John Libbey. World Needs You, London: Texere. 4 Dunleavy, P. and O’Leary, B. (1987) Theories of the Jackall, R. and Hirota, J. (2000) Image Makers: 5 State, Basingstoke: Macmillan. Advertising, Public Relations and the Ethics of Friedman, M. (1962) Capitalism and Freedom, Advocacy, London: University of Chicago Press. 6 Chicago: Chicago University Press. Kitchen, P. (ed.) (1997) Public Relations: Principles and 7 Gaber, I. (2000) ‘Government by spin: an analysis of Practice, London: Thomson Business Press. 8 the process’, Media, Culture & Society, 22(4), Klein, N. (2000) No Logo, London: Flamingo 9 507–18. HarperCollins. 30222 Grant, W. (1995) Pressure Groups, Politics and Democ- Kumar, K. (1993) ‘Civil society: an inquiry into the racy in Britain. Hemel Hempstead: Harvester usefulness of an historical term’, British Journal of 1 Wheatsheaf. Sociology, 44(3). 2 Grant, W. (2000) Pressure Groups and British Politics, Lindblom, C. (1977) Politics and Markets, New York: 3 Hemel Hempstead: Harvester Wheatsheaf. Basic Books. 4 Grunig, J. and Hunt, T. (1984) Managing Public Rela- Lubbers, E. (ed.) (2002) Battling Big Business, Totnes: 5 tions, New York: Holt, Rinehart & Winston. Green Books. Halfon, R. (1998) Corporate Irresponsibility Is Business Marsh, D. and Locksley, G. (1983) ‘Capital: the 6 Appeasing Anti-business Activities, London: Adam neglected face of power’ in D. Marsh (ed.), 7 Smith Institute. Pressure Politics, London: Junction Books, pp. 8 Harrison, S. (2000) Public Relations: An Introduction, 53–83. 9 London: International Thomson Business Press. Miller, C. (2000) Political Lobbying, London: Politico’s 40 Heath, R. (ed.) (2000) Handbook of Public Relations, Publishing. London: Sage. Moloney, K. (1996) Lobbyists for Hire, Aldershot: 1 Heath, R. and Cousino. K. (1990) ‘Issues manage- Dartmouth. 2 ment: end of first decade progress report’, Public Moloney, K. (1997) ‘Government and lobbying 3222 Relations Review, 16(1), 6–18. activities’ in P. Kitchen (ed.), Public Relations

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Principles and Practice, London: Thomson Business Stonier, T. (1989) ‘The evolving professionalism: Press. responsibilities’, International Public Relations Monbiot, G. (2000) Captive State: The Corporate Review, 12(3), 30–6. Takeover of Britain, London: Macmillan. Susskind, L. and Field, P. (1996) Dealing with An Angry Mountﬁeld Report (1997) Report of the Working Group Public: The Mutual Gains Approach to Resolving on the Government Information Service, London: Disputes, New York: Free Press. Cabinet Ofﬁce. Tarrow, S. (1994) Power in Movement, Cambridge: Nelson, R. and Heath, R. (1986) ‘A systems model for Cambridge University Press. corporate issues management’, Public Relations Theaker, A. (ed.) (2001) The Public Relations Quarterly, fall, 20–4. Handbook, London: Routledge. Oliver, S. (2001) Public Relations Strategy, London: Truman, D. (1951) The Governmental Process, New Kogan Page. York: Alfred Knopf. Rosenbaum, M. (1997) From Soapbox to Soundbite: Van Riel, C. (1996) Principles of Corporate Com- Party Political Campaigning in Britain since 1945, munications, London: Prentice-Hall. London: Macmillan. White, J. and Mazur, L. (1995) Strategic Commun- Smith, M. J. (1990) ‘Pluralism, reformed pluralism, ications Management, Wokingham: Addison- and neopluralism: the role of pressure groups in Wesley. policy-making’, Political Studies, 38, 302–22.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 5 2 3 4 Priorities old and new for UK 5 6 PR practice 7 8 Gerald Chan 9 10 1 2 3 4222 5 In this chapter Gerald Chan has looked to update the 1994 Delphi study on research 6 priorities in the United Kingdom. PR theory and practice has changed since the 1990s, 7 mostly brought on by the phenomenal growth of the internet and new media technolo- 8 gies. Looking at the impact of these changes, and based on a Y2K research report the 9 author asks how has the profession of public relations evolved in the years since the 20 Delphi report and what are deemed to be research priorities. 1 2 3 4 5 The current public relations research agenda growth of the internet and new media tech- 6 in the United Kingdom is based on a number nologies. In light of this and the other chang- 7 of research objectives which developed from ing conditions PR practitioners have to 8 White and Blamphin’s 1994 study on research operate in, this update has to illustrate how 9 priorities in the United Kingdom1 and an practice has shaped the course of research and 30222 earlier draft report prepared in October 19902 vice versa. 1 including the need to: A few general questions have been asked to 2 better understand the task at hand. Since the 3 • establish priorities for the limited funding Delphi report, how has the profession of 4 available for public relations research in public relations evolved? What are the 5 further education; amendments to the list of research priorities? 6 • tap into the growing interest in the use of Are these changes simply a matter of re- 7 research in public relations, drawing from arranging the order in which they originally 8 the enlarged resources in the expanded appeared or have there been significant 9 research community. changes in academia/industry that have war- 40 ranted a reassessment of the research agenda 1 Public relations in both theory and practice, in public relations? 2 has changed over the 1994–2000 period, The new project recognizes how develop- 3222 mostly brought about by the phenomenal ments in industry and the wider environment

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors have resulted in shifts in normative and func- • Enhance the existing body of knowledge tional paradigms and thus, by implication, in public relations by using social scientiﬁc research preoccupations. Key objectives are: research techniques to assemble empirical evidence, in order to better understand • To conduct secondary research into White the elements of PR theory and practice. and Blamphin’s 1994 Delphi study. This • Relate to the IPR’s objectives and require- report will offer suggestions for new ments, which are: to provide a structure research imperatives in public relations. for the understanding of the professional Some of the previous subject headings practice of public relations; to provide from the 1994 study have reached matur- educational opportunities to meet and ity while others were in their genesis. exchange views and ideas; and to raise Thus, the original study is far from obso- standards within the profession through lete, because many of the identiﬁed topics the promotion of research. are still pertinent. This report will examine the topics that are still relevant and also For this study to be truly representative of the detect new subject categories for research. current research climate in public relations, • To provide a basis for future analyses into it was imperative that the information the theoretical and applied aspects of obtained would assist in drawing up a list of academic questions that mirrored the require- public relations in the United Kingdom ments of industry. Also, to achieve a balanced and other countries. A criticism falling understanding of current research priorities on the past study is that it concentrated in public relations, it was decided that too much on the United Kingdom’s needs. both academics and practitioners would be This report aims to widen the scope by approached to participate in this study. receiving input from academics and prac- To comprehend the common topics and titioners operating in centres that have problems in PR encountered by academics, reached a credible level of sophistication researchers and practitioners alike, knowledge in public relations, namely: Europe, of the present state of research was required. Northern America and Australasia. In so This was obtained via a content analysis of doing, it is hoped that the overall body the leading publications in PR theory and of knowledge in PR theory and practice practice based in the United Kingdom. They is expanded, while also increasing the were, namely, The Journal of Communication possibilities for co-operation between Management Corporate Reputation Review, the organizations and countries through com- Journal of Public Relations Research and Public parative and joint research initiatives. Relations Review. The volumes consulted were Several international initiatives are those within the 1994–2000 period. Whilst it already in motion and this study will build is accepted that UK titles do not necessarily on their successes. offer a world-view of the current state of public relations, it must be pointed out The research topics that will appear in this that contributors and the editorial board of report will have to conform to the needs of these two publications are not solely from the academic and professional communities. the United Kingdom and come from They will: various backgrounds.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Other sources of information were PR tions can extend into the confines of subjects 2 trade magazines such as the UK edition of such as ‘Technology and public relations’ and 3 PR Week, the IPR’s Profile magazine and ‘International issues in PR practice’. 4 the IPRA’s FrontLine 21 magazine. Clearly A questionnaire was designed based on the 5 this is a limited journal search overall and findings of the content analysis mentioned 6 future developments will widen the literature above, namely the list of suggested research 7 sourcing. topics drawn up according to the frequency of 8 A programme of PR conferences provided a their appearance in the journals cited. 9 broad sweep of the issues and challenges Respondents were asked closed and open- 10 facing contemporary PR practice in the world. ended questions in order for the author to 1 The conference plans that were examined find out as much information as possible. The 2 were the seventh International Public Rela- closed-ended questions required definite 3 tions Research Symposium, held at Lake Bled answers, such as questions pertaining to the 4222 in Slovenia (7–8 July 2000), the IPR National relative importance of a particular subject 5 Conference, London (18–20 October 2000) theme; while the open-ended questions were 6 and the Public Relations World Congress exploratory in nature. This was the informa- 7 2000, held in Chicago (22–4 October 2000). tion gathering stage and it was essential to 8 From the research conducted, the subject collect information that was both qualitative 9 themes chosen are: and quantitative. This initial questionnaire 20 aimed to establish the research interests 1 • strategic planning and public relations; and personal views of respondents, providing 2 • technology and public relations; more clues to other research themes that may 3 • international issues in PR practice; have eluded the author. Data from the 4 • the PR role in organizational change; returned questionnaires would have formed 5 • the measurement and evaluation of the basis for another survey. This second ques- 6 public relations; tionnaire would have been more focused 7 • the need to integrate public relations with and specific in its inquiry into the research 8 other communication functions. priorities of public relations. Subsequently, 9 respondents would have been invited to par- 30222 Subject headings are generic and each can ticipate in a focus group to discuss the findings 1 include other research items as sub-areas of the survey. However, as the time scale for 2 for further study. An example would be in the this project was only two and a half months, a 3 category ‘strategic planning and public rela- more thorough study was made impossible 4 tions’. Other research subjects that arise from due to the time constraints and the slow 5 this one topic include managerial roles in return rate of questionnaires. 6 public relations and the effects of systems A total of 128 six-page questionnaires 7 theory on specific PR practice which in turn, (two-page introduction to the study, four- 8 considers public relations from an organiza- page selection of questions) were electronic- 9 tional point of view, looking at a range of ally mailed to participants from the middle of 40 subjects such as corporate culture and organ- October 2000 to early December 2000. 1 izational behaviour. Likewise, there is also Participants were requested to reply by mid- 2 considerable overlap between the different December. At final count, the total number 3222 subjects. Research into strategy in public rela- of answered questionnaires was forty-eight,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors out of which twenty-three replies were from the new list of research subjects. According academics and twenty-five were practitioners. to one academic, the previous list has not The response rate was thus calculated as 37.5 been researched fully and successfully, other- per cent. wise huge progress in the field of public rela- PR academics from Europe and America tions would have been made. Another were approached to contribute to the study. academic expressed how there are too many The academics approached are all actively research topics already and the present lack engaged in interdisciplinary research in public of resources means that it is impossible to do relations. Practitioners chosen had a known justice to the topics up for research. Overall, interest in research and/or education in public the academic view is for research in public relations and held senior positions in the relations to focus on PR practice, and in sub- organizations they represented/worked for. jects which are relevant to practitioners. They work in consultancy or in-house and Some practitioners, although recognizing have a combined experience in a range of the need for public relations to be theory- backgrounds, including corporate and finan- driven, were wary about scholastic research cial public relations and political communi- into public relations, as such activity runs the cation. Participants were chosen from the risk of reducing PR problems into pedantic various committees of the IPR, including the arguments, an exercise which has no place Training and Professional Development in the real business environment as public Committee, or they were selected from inter- relations is essentially a practical manage- national organizations such as Confédération ment function rather than a set of academic Européene des Relations Publiques (CERP). conceits. In the words of a practitioner, ‘My Speakers at the IPR National Conference 2000 standard stance on these pseudo-scientific were invited to participate, as were the judges research studies is to decline to participate in of the PR Week Awards 2000. order to ensure that no one can suggest that Despite being based on only one question- it was anything more than an academic exer- naire, this brief survey provides a comprehen- cise or that it involved people of some experi- sive overview of the changes in the PR ence and expertise who actually practised environment and profession over recent years. public relations at management level.’ Clearly Respondents provided a large pool of inform- the long-standing debate over the disparity ation crucial to our perceptions of the theory between practitioner and educator competen- and practice of public relations in an evolving cies in public relations still forms a bone of and dynamic world. As the educator–practi- contention. However, recent work by Stacks tioner divide is fairly equal (48:52, from a et al. (1998)3 is aimed at dispelling these total of forty-eight respondents), data gath- myths. Similarly, Moloney et al. (1999) ered has been decisive in giving access into have researched into the effectiveness of PR the differences in opinion, which will be dis- degrees and the occupational destination of cussed throughout this report. PR graduates. The main concern for some academics was The results showed a need for better under- the agenda setting of research priorities. standing of the current research milieu in both Questions were raised over who determined industry and academia. To follow is a list of the the new research proposals and the validity of research interests of respondents. The numer-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 als in parenthesis show the number of people • public relations and culture; 2 from the survey interested in each topic. • social development and public relations. 3 Response was rich and varied and the common 4 topics were: strategy and public relations (10), These groupings are an indication of the inter- 5 PR management (9); ethics (2) and corporate disciplinary and multi-faceted nature of 6 social responsibility (5); issues management modern PR practice. 7 (3); research, evaluation and measurement Respondents were asked to rate the chosen 8 (11); stakeholder relationships (10); globaliza- topics in order of perceived importance, bear- 9 tion issues and public relations (3). ing in mind their relative relevance to current 10 The list below highlights individual research research needs, and also in accordance with 1 areas which are less prevalent but worthwhile the prevailing issues and problems facing con- 2 in our consideration since they disclose the temporary public relations practice. 3 hypothetical and technical concerns that con- Table 5.1 contains six subject headings 4222 front modern PR practice: identiﬁed as being of importance to research. 5 They have been singled out from the other 6 • the interaction of public relations, journal- topics after a content analysis of current 7 ism and the political economy; research published in academic journals. The 8 • the psychology of communication applied high frequency of their appearance as articles 9 to PR practice; is a signal of their signiﬁcance to the research 20 • managing corporate risk; agenda. 1 • return on communication, intangible 2 assets; 3 • convergence of new technologies, integra- Strategic planning and public relations 4 tion of public relations with IT; 5 • effect studies; There was unanimous agreement over this 6 • change communication; topic as being important for research. 7 8 9 Table 5.1 Which are the topics most important and relevant to PR research today? 30222 1 Theme Ranking in order of importance 2 123456 3 4 Strategic planning and public relations 23 86610 5 Technology and public relations 5 4 8 10 8 5 International issues in PR 15471015 6 practice 7 Public relations’ role in organizational 1 14 6 8 10 4 8 change 9 The measurement and evaluation of public 9 8 10 9 5 3 40 relations 1 The need to integrate public relations with 8945710 other communication functions 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Argument over how public relations should be The measurement and evaluation of included in the decision-making process con- public relations tinues, though the trend is that it is assuming more responsibility as a management func- This was considered ‘most relevant to practition. As suggested by the last Delphi study, a tioners’. By providing better methodologies possible research topic could be on the train- for the measurement and evaluation of ing needed by practitioners to make this con- public relations, the result would be higher tribution more effective. Research in this area standards, amidst increasing demands for has already been done in the United States more accountability. According to the research by academics such as Dean Kruckeberg, L. van results of a German academic, there is Lueven and Elizabeth L. Toth. currently low development in evaluation and A practitioner commented on how research public relations, while a British academic into this area should focus on the ‘Return on noted how for measurement, there is ‘already Public Relations (in the sense of the return on enough there for practice to do it . . . if it communication vis-à-vis other management wants to’. The PROOF Survey, launched in functions)’ as it brings together management February 1998, and eventually a collaborative literature with PR theory through the ‘linkage partnership between PR Week, the IPR and between PR practice and corporate strategy’ PRCA has set out definitive guidelines for the thereby providing answers to the continued use of research and evaluation in PR. discussion about the management capabilities and requirements for PR practitioners. An academic who is also an independent Technology and public relations consultant remarked that there is the ‘constant need to monitor and review . . . (since) strat- Academics envisage future research in this egy is misunderstood by PR practitioners . . . area along the lines of ‘the role and con- (as they) sometimes have strategies which are tribution of public relations to the growth either aims/objectives or tactics’. of e-business’ and the changing skills set of practitioners, as industries conform to new technologies. Public relations’ role in organizational A practitioner noticed how ‘there is a change great deal of confusion or misconception that exists around PR and its role (in the new This was featured in the last report as an e-economy). As New Media begins to affect important area for future research. The trend the way we communicate, do business and in many industries is for consolidation via indeed live our lives, there needs to be a re- mergers and acquisitions. Public relations has alignment of how public relations plays a to respond to this through proactive com- part and fits in with society.’ Current research munication with all stakeholders. New areas into the topic has been done by the Institute in PR practice such as conflict resolution and for Public Relations in Florida.4 The IPR’s change communication have elevated the Internet Commission has also published a strategic status of PR practice, especially in the report (Rush, 2000) on the impact of the growth areas of issues and crisis management. Internet on communication.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 The need to integrate public relations multi-national organization’. However, as 2 with other communication functions noted earlier, subject groupings listed are 3 generic and therefore open to interpretation. 4 This continues the debate over the scope of This topic in particular, does not merely refer 5 public relations. A comment was ‘As profes- to issues concerning the customs and etiquette 6 sionalism in PR is highly variable . . . lack of PR practitioners have to be aware of and sen- 7 understanding within and without PR results sitive to while doing business in a foreign 8 from the poor description of the scope of country. The globalization of the world’s 9 public relations.’ economy and the formation of regional cen- 10 In the eyes of a practitioner, ‘There seems tres for trade and development, such as the 1 to be a lot of disagreement over the scope EU and NAFTA, have resulted in political, eco- 2 and meaning of PR. I think this term is becom- nomic and social consequences that will affect 3 ing outdated as public relations is more than PR practice, and in consequence, PR theory. 4222 just media relations.’ Another practitioner There is evidence that academia is beginning 5 said, ‘I see a bifurcation of PR services – on to regard this topic as an influential area for 6 one hand, public relations is losing market scholarly work as seen in the most recent 7 value vis-à-vis other communications disci- publications (Moss, Vercîcˆ and Warnaby, 8 plines (if they can be seen as different), e.g. 2000; Heath and Vasquez, 2001) on public 9 corporate communication, and on the other relations. 20 hand, I see a broadening of public relations The numerous international symposia on 1 towards “total communication” management public relations held each year to bring 2 (also via concepts like ‘reputation manage- together practitioners from all around to share 3 ment’).’ An academic’s view on this topic and transfer knowledge is a clear indication 4 on the other hand, is that there is ‘too much that more emphasis should be placed on this 5 navel gazing – people there just get on and topic despite its poor estimation in this survey. 6 do it!’ Table 5.2 illustrates the headings from the 7 recent study that are still applicable for cur- 8 rent research purposes. Participants were 9 International issues in public relations asked to tick the subjects that are important 30222 practice 1 2 This topic was considered least important in Table 5.2 Which subjects from the old study 3 relative terms for research. A possible reason should still be included in the new set of research priorities? 4 for this occurrence is because most research in 5 theoretical public relations has so far been Theme Number 6 done by Anglo-American scholars, thus the of replies 7 high concentration on international issues The definition of public relations 15 8 from such a perspective. There is also conflict- Professional skills in public relations 27 9 ing opinion over this subject. A practitioner The image of public relations 21 40 noted, ‘this isn’t a matter for proper and Ethics in PR practice 30 1 structured research – there is an easy list to be The impact of media content 16 Gender issues in PR practice 7 2 provided by anyone heading the function for Features of the market for PR service 12 3222 an international business and/or any CEO of a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors rather than rank in order of perceived import- begun to wander into the territory of tradi- ance. In so doing, a ranking of the results tional public relations by offering auditing will surface through participants’ answers. services in management areas such as organ- From the survey, it is clear that rhetorical izational change management and risk issues approaches to public relations are still re- management (Roberts, 2000). Again, the garded highly in the research agenda. overwhelming response from participants is that public relations is recognized as a management function, but it now remains for Ethics in PR practice public relations to carve a more tangible role for itself within its managerial function. This is considered to be the most important subject for research. In the words of an academic, ‘Ethics underpins the practice being The image of public relations implemented, which in turn, has repercus- sions for other concerns in PR such as profes- For this subject, comments centred on the sional skills levels, the image of PR and gender negative connotations of ‘PR’. An academic issues.’ In support of this statement, a practi- reported that it ‘is a particularly worrying area tioner working in public affairs observed how as business/public perception has been dam- ethics are ‘key to the development of business aged by the spin vs. substance debate’. without slurs of sleaze . . . key to how politi- Concern is not unfounded and it has been cians and officials act on most issues . . . key suggested that the best way forward would be to running a successful and profitable business to research into the professionalization of – or it all falls apart!’ Emerging areas for public relations practice as improving stan- research in ethics and public relations are: the dards in the quality of service delivery and effects of corporate governance and corporate social responsibility, as their enforcement has practitioner development would increase the many implications for public relations practice credibility of public relations. worldwide. An educator commented, ‘In thirty-five years, I have always heard the same complaint: Public Relations has to work on its own Professional skills in public relations public relations.’ Indeed, the poor reputation of reputation managers is an ironic note that This is the second most important topic demands further study. since the skills that are required to manage public relations are undergoing constant and dramatic change. The growth of the world- The impact of media content wide web and the effects of a globalized economy have resulted in new communication In the White and Blamphin’s study, the main channels, target groups and techniques. PR area for research into this topic was in the professionals have to meet up with these impact of specific media content, such as the challenges if they are to remain competitive, effects of documentaries on public opinion; especially since management consultancies, and there was the call for a summary of the law practices and accountancy firms have relevant research findings.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 According to a practitioner, ‘The impact of part of the marketing mix or a completely 2 media content can be misleading. Analysis of independent discipline, attention and re- 3 impact often paints a different picture from search should look into the interplay of 4 perception of a likely impact.’ Another practi- marketing functions, such as advertising and 5 tioner noted how ‘further research into the below-the-line marketing with public rela- 6 impact of media content would help every PR tions. By doing so, research will begin to 7 practitioner and would interest and impress reveal the different layers in PR practice and 8 existing and potential PR users far more than thereby possibly arrive at generic definitions 9 other topics’. Research done by John Hitchins for specific occasions. 10 at the College of St Mark and St John in According to a practitioner, ‘The definition 1 Plymouth seeks to address this issue. is key as public relations moves up the board- 2 room, the traditional roles in marcomms are 3 changing and fast. New developments means 4222 The definition of public relations that the power of PR is even more far reaching 5 than before.’ By researching these different 6 This is still considered a relevant subject. areas of public relations, we can enhance our 7 Despite many attempts to define what understanding of the use of public relations in 8 public relations is, a common concept is hard different situations, and how it operates under 9 to achieve as public relations is practised these different conditions. A practitioner 20 differently from sector to sector, country to notes that this will help to ‘define clearly the 1 country. An academic states how ‘there is scope of the roles and responsibilities 2 (still) no consensus on the definition of public assumed by practitioners . . . identifying areas 3 relations’, while another academic pointed which need attention’. 4 out, ‘If we don’t know what public relations 5 6 is, how can we achieve excellence in prac- 7 tice? The future of the field depends largely Features of the market for PR service 8 on its ethical practice, on the integrity of PR 9 practitioners.’ According to the last report, it was suggested 30222 The need to derive a universal definition of that research on this topic should be gathered 1 public relations is near impossible, given the primarily by the professional associations, as 2 inherent linguistic and cultural differences in they acquire the staff resources to carry out 3 the world. Several joint projects since the this work. 4 1990s have striven to break down these barri- Currently, surveys of market data and 5 ers and to enhance co-operation between trends (such as cost structures in wage terms) 6 academics and practitioners across continents. have been carried out by the national mem- 7 This however, remains a gargantuan and long- bers of the International Committee of Public 8 term task. The trick perhaps, is to ‘think Relations Consultancy Association (ICCO). 9 global, act local’ and focus research in public Consequently, PR services in all their diversity 40 relations on specific aspects of practice, in and similarities can be understood, and the 1 accordance to the demands of the environ- PR profession as a whole, will be in a better 2 ment and its application. For instance, rather position to brief clients more effectively 3222 than argue over whether public relations is when it comes to developing international

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors programmes. This is possible only if the fea- issues in public relations is an interesting area tures of the market and their implications for and along with management theory, should PR services are known. be developed further in this area’. Likewise, the PRSA and IABC have con- Table 5.3 brings together the collection ducted research into a compensation survey. of new research priorities. Participants were Further initiatives of this kind will help estab- required to rank each subject heading accord- lish professionalism in public relations prac- ing to perceived importance on a scale of tice, in light of the industry’s response to 1 to 7. The number of votes for each column changes in the shape and values of the would signify the amount of importance market. attached to the subject.

Gender issues in PR practice Technology and public relations

This was regarded as the least important Given the boom in the internet and the topic, relative to the others cited. Under- dot.com industry since the 1990s, technology standably, it was female academics who con- and public relations is an area of increasing sidered this as an area worthy of research. importance for sustained research, as Examples of comments include ‘The ﬁeld is advances in digital technology result in new increasingly feminized, in terms of numbers communication channels and audiences. but certainly not in power. To avoid further Fashionable new terms such as ‘convergence’ devaluation of public relations, we need to and ‘disintermediation’ mean that manag- study how the growing number of women will ing communication and relationships has affect the ﬁeld and, more importantly, how become more varied and complex. Issues such women can and do contribute if they are not as interactivity (a new dimension to com- forced into the male model’ and ‘Gender munication as opposed to the Grunig and

Table 5.3 Which topics from the new list do you consider to be most important?

Theme Frequency of replies

Ranking in order of importance 1 2 3 4567

Technology and public relations 10 5 3 7 9 4 3 Examining speciﬁc aspects of PR practice, or 6 6 12 8 1 7 2 new communication areas that come under the remit of the communication professional Reputation and issues management and 12 11 5 5 5 3 2 corporate identity Human resources, internal relations and 1 4 7 4 10 5 9 personnel communication Client expectations, service quality and PR 5 9 4 8 6 1 8 Education in public relations and use of 4 2 7 5 5 9 4 social science research The scope of PR theory and practice 7 5 8 3 1 7 9

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Hunt’s (1984) long-standing two-way sym- Public affairs provides a wealth of research 2 metrical model of communication between opportunities as it includes other activities 3 organizations and their publics), freedom of within the remit of the professional com- 4 choice on the internet and respective PR activ- municator, such as community relations, 5 ities designed to respond to this change, are which according to a practitioner is ‘an aspect 6 possible research areas. of corporate social responsibility’ and research 7 An academic commented how ‘The impact should be on ‘whether it is (or should be) 8 of new technologies is a key issue. The inter- an expectation that good businesses/organisa- 9 net has brought enormous changes to the way tions have a responsibility to government/ 10 organizations communicate, and the fragmen- regulatory consultation to help fashion public 1 tation of the media as a result has meant that interest outcomes’. 2 PR practitioners have to work in a different 3 way.’ Another mentioned, ‘(this) remains a 4222 constant area of professional interest espe- Reputation and issues management 5 cially given the potential impact of techno- and corporate identity 6 logical change on the required skills base of 7 practitioners’. As large corporations and organizations strug- 8 gle to remain favourable in the constant 9 media spotlight, the need for proactive public 20 Examining specific aspects of PR relations and the demand for services in issues 1 practice, or new communication areas and crisis management have increased. Most 2 that come under the remit of the research in this area exists in documented case 3 communication professional studies of corporate disasters that were con- 4 trolled or averted, successfully or otherwise. 5 This topic brings together a combination of 6 There remains the need to demonstrate concepts from other disciplines from the social 7 empirically the effectiveness of public rela- 8 sciences (such as psychology and sociology) tions in these situations. A problem however, 9 and analyses how their application in PR prac- would be in gaining access to conduct 30222 tice makes communication more effective. To research as the relevant information is usually 1 illustrate, the political equivalent of public sensitive and hidden from the public gaze. 2 relations is public affairs. Possible research in Indeed, an understanding of the concept of 3 this field of PR can be in political marketing corporate identity and corporate image is 5 4 during elections. This topic also looks at spe- essential to the PR practitioner in understand- 5 cial interest groups within the PR profession, ing how reputation is built and formed.6 6 such as financial PR or PR in the voluntary/ Respondent answers are described below: 7 not-for-profit sector. 8 Suggestions for research into public affairs • ‘Reputation and issues management is the 9 include ‘The impact of public relations/public key for methodology development and 40 affairs on business success’ and socio-political also for clients/employers of PR.’ 1 issues ‘applies to all public relations, not • ‘Issues such as legitimacy and social 2 simply government affairs, because politics responsibility are important in our con- 3222 touches everyone sooner or later’. sideration of reputation management.’

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors A practitioner claims that research should be Client expectations, service quality and in ‘defining good corporate responsibility with public relations reference to good communication, e.g. internal and community relations’. Understandably, practitioners expressed concern for this topic. Interest centred around researching client/agency relationships, from a Human resources, internal relations client’s perspective. Research would concen- and personnel communication trate on strategic relationships between users of public relations and PR service providers, in This topic refers to research into how PR the effort to understand the requirements and agencies recruit and keep staff, an area which wants of clients. A practitioner said, ‘It’s good in current management jargon is known as to know how we should change and develop the ‘emotional capital’ of an organization. to meet the needs and wants of our clients, Research in the area of ‘talent management’ but it would also be useful if, as an industry, has been conducted by recruitment consult- we could advise clients how they should ants Odgers Ray and Berndtson. change and develop to get the most out of PR This topic also refers to research into com- . . . it would be fair to get both sides of the munication programmes with all personnel argument – e.g. clients would say they want working for an organization, whether tech- more strategic advice from their PR team. The nical, e.g. the monthly staff newsletter, or flip side of that might be the PR team saying strategic, e.g. specialized schemes to boost that they’d love nothing more than to give staff morale in the face of a possible crisis. more strategic advice but rarely have the Thus, there are other areas for research for opportunity to do so.’ this topic, e.g. issues management (especially This topic can be examined as an extension in relationships with trade unions) and of the subject ‘the measurement and evalua- employee relations. tion of public relations’. A practitioner who A practitioner noted: ‘I think human re- is also an academic noted, ‘I see both sources, internal relations and personnel com- clients and students being more concerned munications is a clumsy description. We are with financial results and our capabilities to simply addressing internal audiences and rela- demonstrate them. And to be honest, as long tionships (and indeed the internal organisa- as we are not capable of demonstrating the tion aspects of reputation management and financial outcomes of our inputs (which corporate identity issues). Yes we know that clearly are costs) we have limited growth for historical reasons HR/personnel often capacity.’ Another practitioner academic inherited internal communication, and exter- commented, ‘PR needs to demonstrate its nal relationships might be allocated to a “deliverables” to the organisation . . . (and) marketing function. This bifurcation is unwise, evaluation will only be successfully addressed and reflects naively about organisational in a pervasive research culture.’ structure and mechanics.’ By studying the levels of client satisfaction in qualitative and quantitative terms, researchers will be able to analyse service

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 quality. At present, the issue of quality in for Education in Journalism and Mass 2 public relations is being researched by the Communication, Colorado State University, in 3 International Institute for Quality in Public the United States. 4 Relations (IQPR) and their findings have A practitioner suggested that ‘the basics 5 helped to develop ISO 9000 standards in need to be attended to first – all theses for 6 public relations. The demands of this quality which advanced degrees are awarded in 7 standard are high. Briefly, they will cover four public relations by universities should be 8 key aspects: the responsibility of PR manage- logged and subject to scrutiny by a practi- 9 ment, the needs of clients, the necessary tioner panel (from a national PR organisation, 10 resources needed to maintain these standards such as the PRSA or IPR) of the highest calibre 1 and the structure of the quality system. and used as the basis for further and better 2 research that is libraried and made available 3 to all business and management schools’. 4222 Education in PR and use of social In terms of professional skills in public rela- 5 science research tions, there is the need ‘to fine-tune the edu- 6 cational programmes in line with vocational 7 This topic ranked highly among academics needs’. 8 engaged in research and/or pedagogy. 9 Research into PR education increases profes- 20 sionalism and forms the basis for good educa- The scope of PR theory and practice 1 tional programmes. Fundamentally, all 2 subjects that have appeared on the last list This subject would examine public relations 3 and this update, are in context, useful for from different perspectives. For instance, pub- 4 public relations education in a large extent. lic relations as a subject is taught mostly in 5 Research in this area could concentrate on 6 schools of journalism in the United States, analysing the different methods of teaching 7 while in the United Kingdom, it normally and training for public relations in the differ- 8 belongs to faculties of business in universities. 9 ent countries. An academic suggested that Is the subject of public relations a com- 30222 research should look into forming ‘possible munication or management discipline? Is it 1 guidelines for public relations education at marketing led, or has it a strategic role? By 2 different levels, i.e. undergraduate, postgrad- examining this topic closely, one of the results 3 uate, postdoctoral’. Presumably, this would would be the definition of what PR practice is, 4 entail examining the curricula or syllabuses of in different circumstances. This being the case, 5 PR/PR-related courses in individual countries, there will be an eventual widening of the skills 6 or in comparison between different countries, base of a PR practitioner through knowing 7 or between different universities that teach what is required of public relations in different 8 public relations. Research in education has contexts. 9 already been conducted in media studies and General comments included: ‘There seems 40 mass communication, done by organizations to be a lot of disagreement over the scope 1 like the National Communication Association and meaning of PR. I think that the term 2 based in Washington, DC, and the Association is becoming too closely related to media 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors relations. The term that seems to be increas- tion of public relations is still relevant today ingly in use is communication or reputation’; despite many previous attempts (by national and ‘There seems to be room for further public relations associations especially) to development. In the long term, we shall of construct a universal meaning for public rela- course have moreinsights into the topic(s) . . . tions. Most recently, the EBOK project for the findings shall eventually be beneficial for instance, lists ‘communications’ and ‘relation- producers and consumers of public relations ship building’ as major concepts in European services.’ public relations. For this study, an academic This section was included in the question- commented, ‘The nature of relationships – naire in order to see if there was any congru- how to define and measure them – seems to ence with respondents’ stipulated research be the biggest topic today.’ This view is in interests. In the case of the academics sur- keeping with participants’ earlier listing of veyed, it serves as a measure of the current ‘relationship building’ and ‘social interaction’ trends in learning and the present state of PR as an area of research interest. theory. As most academics are involved in Some academics were also interested in the multidisciplinary research in public relations, role of public relations in other business/ looking at it from such diverse subject areas as mass communication functions, such as its use historiography, sociology, rhetoric, marketing in integrated marketing communication and business studies, it became evident (IMC). For one academic, it was crucial to that the result will be a cross-fertilized picture study ‘organisational configurations support- of public relations. From a practitioner’s per- ing integrated communications’, as there is spective, it exposed the PR problems and the need to institutionalize good communica- patterns that professionals face on a daily tion throughout organizations. While for basis and perhaps also the urgency felt in the another, emphasis should be on ‘participant search for feasible solutions. Again, it teased observation and in-depth interviews with from respondents, questions pertaining to the media organisations, including online news nature of the business of public relations services, to determine the value of different and helped shed light on the different (and approaches by public relations sources’, the differing) ways in which public relations is rationale being that media relations is the approached and applied. most widely used method by organizations wishing to enhance their reputations. Other suggestions include: Academic view • PR education and ‘the underlying divers- There was consensus that research should be ity and richness of (different) “schools of conducted into the ‘relationship manage- thought” ‘ as this forms the basis of pro- ment’ aspect of public relations. This concept viding practitioners with a ‘clear view of of public relations is not entirely new (Grunig the profession’; and Hunt, 1984), forming the foundation of • the development of effectiveness models modern public relations theory and practice, that link PR outcomes to organizational but it does mean that the need for a defini- performance indicators;

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • the equity value of corporate reputation; encountered on a day-to-day basis and this is 2 • identifying measures on the return on clearly reflected in their suggestions. 3 investment (ROI) in PR activities; Obvious suggestions for research emphasis 4 • organizational response to activist pres- were in strategy and public relations, and the 5 sures; construction of a methodology for issues and 6 • social implications of unprofessional reputation management. Most practitioners 7 public relations. wanted research to concentrate on specific 8 aspects of PR practice such as public affairs and 9 PR education is a continued source of research political communication. As with the academic 10 for academics and the spring (1999) edition view, interest/pressure group activity is an 1 of Public Relations Review is solely devoted to important topic, but the focus is on the organ- 2 this topic. Professional bodies such as the ization itself and the legal and regulatory 3 Public Relations Society of America have also perimeters that organizations operate in, 4222 conducted research into PR education.7 rather than the management of possible exter- 5 Currently, the Swedish Public Relations nal threats. For one practitioner, there needs to 6 Association SPRA, along with other private ini- be research into the ‘link between good corp- 7 tiatives, are engaged in research on the return orate governance and good corporate com- 8 of investment on non-material assets.8 munication (for both internal and external 9 The social implications of public relations audiences)’ and defining ‘good corporate 20 are linked to a range of issues such as culture social responsibility with reference to good 1 and organizational behaviour, and are closely corporate communications, e.g. public affairs 2 aligned on the macro-level with research activity as an aspect of corporate social respon- 3 into interest/pressure group activity and public sibility in the fashioning of public interest out- 4 relations. Most of the work done in this area comes’. A practitioner remarked that research 5 has been collected in the form of case studies, should look into issues such as, ‘is communica- 6 such as Shell’s Brent Spar episode. The grow- tion global . . . why are NGOs better communi- 7 ing influence of NGOs, along with the anar- cators than anyone else? Is it because they are 8 chist tendencies of some lobbying groups, as better politicians than politicians?’ As an area 9 seen at the anti-capitalist protests in Seattle of research into the failure of effective com- 30222 and Prague, and the Nice summit in 2000, munication, examples provided were political 1 and the need to manage these situations lobbying in the anti-abortion, anti-tobacco 2 proactively while under constant media campaigns. Other suggestions by practitioners 3 scrutiny makes ethical issues and activism in included ‘measurement and evaluation’ and 4 the PR environment an increasingly important ‘client–agency relationships’. 5 area for study. In terms of measurement and evaluation, a 6 practitioner commented that research should 7 go into, ‘Practical, low cost research methods 8 Practitioner view for PR – e.g. the validity of case studies, pre- 9 testing, etc. PR seems unaware of the many 40 There was a difference in the way practition- low-cost and no-cost research tools and still 1 ers approached this question. Practitioners are makes the excuse of not doing evaluation 2 more concerned with business-related issues because of the cost’. Multinational PR agencies 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors have in place some form of auditing procedure order to have a more balanced view between to determine the relative effectiveness of their theory and practice, it was decided that both communications. Likewise, there are market academics and practitioners would be sur- research companies involved in quantitative veyed. However, conflicting opinions arose media measurement and evaluation. simply because of the different research needs A wealth of resources, data and expertise and demands of the respective groups. It thus exists for further, more detailed research was detected that the research priorities of into this area. An interesting note here would academics depend on personal interest. be the practitioner–academic divide over Similarly, practitioners’ research interests were this topic. Despite listing ‘evaluation and meas- in the area of their particular specialism, or urement’ as still having relevance to PR the field of public relations that they work practice, the general academic viewpoint in. Thus, there was a fair amount of bias concerning research into evaluation and meas- shown when participants were requested to urement is that has been ‘done to death’, a choose their research priorities from the lists view not shared by practitioners. Perhaps a provided. likely reason for this is, as with any academic There were certain points of agreement, subject, that there will be occasions when cer- such as those relating to questions that are tain contemporaneous themes, such as the abstract and require critical discourse to evaluation and measurement of public rela- appreciate. An example of a question of this tions, become ‘hot topics’. Swept by the nature is the perennial inquiry into the image Zeitgeist, the result will be a plethora of of public relations. Public relation’s roots in research into that topic. A calculation of the propaganda and publicity and its past and number of graduate dissertations written on present use of persuasion to manipulate evaluation and measurement of PR activities, and manage provides opportunities for con- in relation to other research topics at a given tinued research and is also a sign of the period, will confirm this hypothesis. This trend, evolution of public relations as an object of in turn, signals how public relations has devel- serious scholarship. oped and matured as an academic subject. Instead of looking out for consensus, The question of client–agency relationships research interests were compared and con- can be researched from either perspective, trasted so that common issues or points of and also in tandem with measurement and contention were revealed, thus adding to our evaluation. According to a practitioner, re- understanding of the nature and current state search could focus on the ‘elements that PR of PR research. practitioners believe could change or improve Problems encountered during the analysis their relationships with clients, and the of research findings were: acceptability of those suggestions could be tested among their clients’. From this sugges- • Some participants provide vague answers tion, other issues may be considered such as to open-ended questions. This made ‘fees for pitches, client funding of measure- interpretation a complex process. For the ment and evaluation of PR through research closed-ended questions, specific instruc- departments’. tions were sometimes not followed. It is difficult to draw up a definitive list of Several respondents ticked instead of research priorities for a variety of reasons. In rating research subjects according to per-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 ceived importance. These answers were response was that academics and practitioners 2 obscure as they provided no sense of the should deepen their dialogue since theoretical 3 particular subject’s relative standing to and applied research into public relations 4 other subject headings. They were dis- are important if public relations is to achieve 5 counted as such. credibility as a profession and an academic 6 • Some respondents felt that certain subject discipline. This short study was such a col- 7 categories were of equal importance, laborative effort between these two groups 8 so there are instances of double rating. to determine the areas of thought and con- 9 This made overall comparison difficult cern facing present and future public relations 10 because responses had to be double- research. It has been successful in its objec- 1 counted. tive to understand the PR environment from 2 • Some respondents did not rate at all while theoretical and practical perspectives. It has 3 a few felt that they weren’t confident also been successful in gathering opinion 4222 about answering the questionnaire as they from a broad cross-section of participants, and 5 were unfamiliar with the original report, has considered contemporary PR theory 6 or felt that they did not have sufficient and practice from an international stand- 7 expertise in the areas cited to offer a criti- point. 8 cal or informed opinion. These questions This study does not propose to set the 9 were left unanswered by respondents. agenda for PR research but is representative in 20 • Several respondents felt that the question- expressing the views (collective and other- 1 naire design was poor. According to them, wise) of its participants. The observations and 2 there are areas of overlap in the questions suggestions mentioned in this report have 3 provided, while certain questions needed refreshed the original list of research priorities 4 further clarification. It was felt that the set out in 1994. In principal, all subject head- 5 question categories were not in-depth ings from the 1994 study are still relevant to 6 and should have been normative rather research, and the original list of sixteen sub- 7 than precise. Another criticism was that ject categories has expanded to include topics 8 the questions were too constraining. A previously unidentified. What this report has 9 respondent felt that the choice of subjects done is to highlight the changes in and addi- 30222 should be reduced. The result was poten- tions to the PR research agenda over the six- 1 tial confusion for participants. year period. It has also considered the 2 differences in opinion from the two groups 3 During White and Blamphin’s 1994 Delphi surveyed, i.e. academic and practitioner, and 4 study, participants were asked the question has outlined the implications of these differ- 5 ‘Who sets the agenda?’ and the general ences for future PR research. 6 7 8 NOTES 9 40 1 Research paper presented by White and UK practitioners and public relations academics 1 Blamphin (1994), ‘Priorities for research into in May, June and July 1994’, at the Research 2 public relations practice in the United Kingdom: Symposium held at the Institute of Public Rela- 3222 a report from a Delphi study carried out among tions, London on 11 November 1994.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 2 Wheeler, T., D. Moss and J. White, ‘A draft report and Education. Pavlik, J. V. and David M. for the public relations education trust: the Dozier (1996) Managing the Information strategic options for public relations research in Superhighway: A Report on the Issues Facing the United Kingdom’, October 1990. Communication Professionals, Gainsville, FL: 3 This paper was the largest and most compre- Institute for Public Relations Research and hensive study ever undertaken on public rela- Education. tions education in America, and was presented 5 Volume 30 (1996), issue 10–11 of the European at the National Communication Association’s Journal of Marketing investigates the various ways 1998 Summer Conference on Public Relations which marketing communications is employed in Education. politics. 4 A brief summary of each topic is available online 6 Volume 31 (1997), issue 5 of European Journal of from the Institute for Public Relations’ website: Marketing explores corporate identity, what it http://www.instituteforpr.com/projects.html. means, what it entails and how it is managed. Wright, Donald K. (1998) Corporate Commun- 7 The PRSA’s website (http://www.prsa.org/) pro- ications Policy Concerning the Internet: A Survey vides an online version of its research Public of the Nation’s Senior-Level Corporate Public Relations Education for the 21st Century: A Port of Relations Officers, Gainsville, FL: Institute for Entry. The Report of the Commission on Public Public Relations Research and Education. Pavlik, Relations Education, October 1999. John V. (1997) Management Policy Issues on the 8 The SPRA (http://www.sverigesinformations- Internet: The Public Relations Perspective, Gains- forening.se/) has details on its report Return on ville, FL: Institute for Public Relations Research Communications.

REFERENCES

Berth, Kirsten and Sjöberg, Göran (1997) Quality in L’Etang, Jacquie and Pieczka, Magda (eds) (1996) Public Relations, Copenhagen: IQPR. Critical Perspectives in Public Relations, London: Botan, Carl H. and Hazelton, Vincent Jr. (eds) (1989) International Thompson Business Press. Public Relations Theory, Hillsdale, NJ: Lawrence MacManus, T. and Moss, D. (1997) Public Relations Erlbaum Associates. Research: An International Perspective, London: Broom, Glen M. and Dozier, David M. (1990) Using ITBP. Research in Public Relations: Applications to McQuail, Dennis (1994) Mass Communications Theory: Programme Management, NJ: Prentice-Hall. An Introduction, London: Sage. Grunig, J. E. and Hunt, T. (1984) Managing Public Moloney, K., Noble, P. and Ephram, K. (1999) Relations, Hillsdale, NJ: Lawrence Erlbaum Asso- Working Papers in Public Relations Research 3, ciates. ‘Where Are They Now?’ The Source Book of a Grunig, J. (ed.) (1992) Excellence in Communications and Research Project into Six Cohorts of Graduates from Public Relations Management, Hillsdale, NJ: LEA. BA (Hons) Public Relations, School of Media Arts Heath, R. L. and Vasquez, G. (2001) Handbook of and Communications, Bournemouth University. Public Relations, Thousand Oaks, CA: Sage. Moss, D., Vercˆicˆ, D. and Warnaby, G. (eds) (2000) IPRA Gold Paper No. 3 (1979) A Report on Public Perspectives on Public Relations Research, London; Relations Research, London. Routledge. IPRA Gold Paper No. 4 (1982) A Model for Public Rela- Pavlik, J. (1987) Public Relations: What Research Tells tions Education for Professional Practice, Us, Newbury Park, CA: Sage. London.IPRA Gold Paper No. 12 (1997) The Roberts, Patrick (2000) Reputation Gets Legal: Evolution of Public Relations Education and the Reputation, Risk and Law Reform and the Challenge Inﬂuence of Globalisation: Survey of Eight Countries, to Public Relations Practitioners, seminar session at London. the IPR National Conference, London.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Rush, Jonathan (2000) The Death of Spin? How the Toth, Elizabeth (ed.) (1992) Rhetorical and Criti- 2 Internet Radically Changes the Way Corporations cal Perspectives to Public Relations, Hillsdale, NJ: 3 Will Communicate, London: IPR. LEA. Stacks, D. W., Botan, C. and Turk, J. V. (1999) ‘Per- 4 ceptions of public relations education’, Public 5 Relations Review, 25(1), 9–28. 6 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Liam Ó Móráin

In the United States, corporate governance legislation was introduced primarily directed at listed enterprises requiring executives to certify ﬁnancial statements as accurate and requiring increased oversight of boards and auditors. Private unlisted enterprise however, remains free from such regulatory control and security. This chapter asks if there is a role for corporate communication in governance at enterprise, either listed or unlisted. The chapter will look at some relevant governance issues and outline the historical development of communication in unlisted enterprises.

Introduction ‘PR is press relations, and because we don’t talk to the media, we don’t need PR’. As a communication practitioner (PR, IMC, Different government agencies’ investiga- corporate affairs, etc.) in Ireland this re- tions (Ireland and the United States) into cer- searcher’s encouragement to examine corpor- tain aspects of how governance and corporate ate communication (CorpCom) in the context management operate, especially in relation to of the similarities differences, comparisons listed enterprises, has created tighter rules and contrasts between listed and unlisted and new regulations in terms of establishing family owned enterprises is to gain a greater accountability, responsibility and trans- understanding of the unlisted family owned parency with respect to the interests of share- enterprise decision makers’ motivation to- holder investments and returns. In Ireland, wards communication best practice in organ- political and business–government bribery izations on the one hand, and, on the other scandals and investor tax avoidance scandals, hand, to understand the practised reluctance which involved exposing governance and of these decision makers to apply best practice corporate management dishonesty and fraud in their communication. In addition our goal (the Ansbacher Inquiry, the Flood Enquiry, the is to investigate real or imagined reasons for Moriarty Tribunal) have led to the establish- the ad hoc approach to communication, i.e. ment of a new director of corporate enforce-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 ment (Hegarty, 2002). In the United States, A limited unstructured qualitative research 2 corporate governance legislation was intro- process, involving two Irish based family 3 duced, primarily directed at listed enterprise owned unlisted enterprises – one a group of 4 enforcement, requiring executives to certify companies, the other a one-product (brand) 5 financial statements are accurate and requir- company – is under way, and is aimed at chal- 6 ing increased oversight of boards and auditors lenging and testing the suggested CorpCom– 7 (Sunday Business Post, 22 December 2002). governance model, introduced here. No 8 Private unlisted enterprise is free from such conclusions are proposed at this time, as the 9 regulatory control and scrutiny. Crosbie qualitative research is not yet completed 10 (2000) explains that family businesses tend to nor available, however a specific area of 1 be less profitable than other kinds of busi- further research is suggested. 2 nesses, and argues that family firms take a 3 long time to build, but that building them, 4222 rather than satisfying the short-term dividend, Literature review 5 needs of a group of shareholders, is usually 6 the key objective. Crosbie says that: ‘Family Existing literature and scholarly work focuses 7 firms are greatly helped by the fact that they on the strategic, policy and implementation 8 do not have a public AGM at which they have programme aspects of corporate communica- 9 to show shareholders what they have tion, as a management tool, in quoted enter- 20 achieved and a public company has to prove, prises. There is limited academic published 1 every single year, that it is profitable, while a study in the area of unquoted enterprise spe- 2 family [unlisted] firm does not.’ cific to corporate communication, although 3 This chapter examines literature exclusively, many published academic works discuss 4 and in researching the origins, emergence and governance, ownership, entrepreneurship, 5 development of communication in enterprise, and a variety of management disciplines that 6 focuses initially on CorpCom in management encompass communication issues indirectly 7 and asks if there is a role for CorpCom at rather than specifically and exclusively 8 governance in enterprise, either listed or addressing research topics in corporate com- 9 unlisted? In an effort to further examine the munication. 30222 opportunities of corporate communication at To date, there appears to be a dearth 1 governance in enterprise, this chapter dis- of study, research or investigation into the 2 cusses some relevant governance issues and corporate communication function in un- 3 outlines the historical development of com- quoted enterprises, especially unquoted 4 munication in unlisted enterprise. family enterprises. From our study and limited 5 Although there is a dearth of literature research, this chapter shows that scholarly 6 addressing the relationship between govern- and investigative research in quoted enter- 7 ance, CorpCom and directorial duty, and prise is growing in intensity and focuses on 8 although CorpCom is addressed by academics areas and issues of corporate communication 9 (Van Riel, Dolphin, Oliver, Grunig, Argenti, management disciplines. The corporate com- 40 et al.) in management terms, this chapter munication field of study has been evolving 1 believes there is opportunity to develop and throughout the twentieth century in schools of 2 apply a CorpCom model at governance, and communication and journalism. Research in 3222 suggests such a model. corporate communication, outside the realms

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors of mass communications, journalism and gained from closely examining this view. Van organizational communication is sparse Riel (1995) believes that communication is (Argenti, 1996). However, there is evidence increasingly gaining the status of a valuable, if that research in corporate communication by not indispensable management tool, together a variety of writers (Oliver, Argenti, Varey and with the obligations that such status carries: White, Heath, Grunig, Munter, Van Riel, ‘In common with financial management, pro- Dolphin and others) is continuing with an duction management and human resource emphasis on quoted enterprises. Dolphin management, communication is expected to (1999) offers the following definition of contribute to the achievement of company CorpCom: ‘Corporate communication is the objectives. Communication’s role in this strategic management process by which an process can be summarised briefly as follows: organisation communicates with its various “to professionally carry out the window and audiences to the mutual benefit of both and the mirror function” ’ (Van Riel, 1995). to its improved competitive advantage.’ Van Riel (1995) explains that the phrase ‘window functions’ addresses the preparation and execution of communication policy A management approach ensuring that messages show all aspects of an organization in a clear and attractive manner. It would appear that corporate communica- ‘The anticipated outcomes of this portrayal tion is seen exclusively as a management func- are the changes desired by the company tion within the fields of academic debate with on a cognitive, affective and conative level in leading authorities (Oliver, Van Riel, Heath, those target groups with which it is aimed to Dolphin, Grunig, Argenti et al.) examining the build and maintain a relationship’ (Van Riel, authoritative management position or role of 1995). corporate communication in quoted enter- Van Riel (1995) also explains that the prises, and arguing how different commun- phrase ‘mirror function’ addresses the moni- ication disciplines – strategic, policy and/or toring process of environments’ developments programme – may be prioritized as manage- and anticipating how they may affect or ment circumstances dictate. For instance, impact on the organization’s communication Oliver (2001) argues that due to downsizing policy: ‘For instance, the mapping of image- there is increased responsibility for managers building among relevant stakeholders, publi- and staff to know and be familiar with the cation of actual achievements, (e.g. market company’s strategic plan, and that traditional shares), evaluations of future trends (issue corporate strategy viewed the management management) and, in particular, keeping up system in the following manner: ‘Strategic with changes in the internal organizational planning as a top level activity, management climate’. control as a middle manager executive activity Corporate communication is an approach and operational control as a supervisory, or rather than a discipline, Dolphin (1999), and first level management task’. Corporate com- it has developed into ‘an essential manage- munication in all areas, says Oliver (2001) is ment discipline’: ‘It is an approach that sets affected by ‘the prevailing top-down culture’. out to ensure the consistency of the corporate Greater understanding, in terms of its applica- message and the transparency of the organisation to the unquoted family company, will be tion. It is a function that anticipates issues,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 events, and crises before they occur. Through duty and responsibility for board directors is 2 its messages and themes the organisation con- of specific interest here. As a practitioner 3 veys its desired image and persona’ (Dolphin, working with business and industry in Ireland 4 1999). the challenge is to persuade board directors of 5 Heath (1994) also endorses corporate com- unquoted enterprises and their senior 6 munication as a management function and management to establish sustained planned 7 argues that an understanding of communica- business-objective-driven corporate com- 8 tion can help managers and their personnel munication programmes aimed at supporting 9 co-ordinate efforts needed to achieve their their strategic and corporate business objec- 10 company’s mission. Varey and White (2000) tives. Oliver (1997) argues that firefighting 1 state that the debate continues about that part responses to communication problems are not 2 of the overall management task having to do strategic and endanger the corporate mission 3 with the management of important relation- at a number of levels. Practitioner experience 4222 ships and with communicating with groups in in Ireland suggests that communication 5 these relationships. Introducing, and critically management in enterprises operates as Oliver 6 analysing, this model of the CorpCom system (1997) terms the current practice, as a ‘short- 7 of managing – integrating internal with exter- term management imperative’. CorpCom is 8 nal communication systems and processes, reflected in Ireland primarily as a media- 9 Varey and White (2000) ‘urge stronger, direct relations-driven, PR function. Varey and White 20 linkages between those who need to com- (2000) make a strong argument in favour of 1 municate and those who are charged with managers’ need to recognize the CorpCom 2 enabling and facilitating these interactions’. managing system ‘as central to the work of 3 None of these academic writers and re- the enterprise community’: ‘The corporate 4 searchers, from our research and from the communication approach enables the recon- 5 information available, appears to draw a stitution of social and economic interests, for 6 distinction between listed enterprise, and un- business is in reality a socio-economic institu- 7 quoted family enterprise, although the tion upon which we are all dependent’ (Varey 8 emphasis in the literature is clearly weighted and White, 2000). 9 in favour of debating issues relating to the Corporate community is the new form of 30222 functionality of CorpCom in listed enterprise organization governance that shifts emphasis 1 (Van Riel, Dolphin, Oliver et al.). from profit to democracy by unifying the 2 goals of all parties and while the old model of 3 business is too limited because it is ignoring 4 A role for CorpCom at the reality that business is both an economic 5 governance? and a social institution, corporate governance 6 can evolve towards collaboration amongst all 7 Academic research appears to have over- stakeholders (Varey and White, 2000). They 8 looked governance and corporate communi- discuss the changes in corporate governance 9 cation. Research shows there is no debate on and the growing influence of stakeholders on 40 the issues as to whether corporate communi- management and suggest that collaboration 1 cation should have director responsibility on with stakeholders is now occurring as the 2 the boards of listed or unquoted enterprises. stakeholders gain power and because man- 3222 Corporate communication as a governance agers need their support (Varey and White,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 2000). Stakeholders with a large stake in a samples of initial public offerings in the company have a greater incentive to play an United States and Canada, found that valua- active role in corporate decisions because they tion is positively related to retained owner- internalize the benefits from their monitoring ship, the auditors’ report and auditors’ effort (Pagano and Roell, 1998). In Europe, quality. No research was found to prove or most companies are not listed on stock disprove a perceived opinion in the business exchanges and when they are, Pagano and community that unlisted firms shy away from Roell (1998) report that a single large stake- CorpCom, as a strategy, because the need to holder, or a tightly knitted group of share- communicate in the wider financial and busi- holders retains a stake in the company: ‘Since ness circles is not necessary. this ownership structure makes companies No specific references were found in aca- impervious to takeovers, the controlling stake demic journals to CorpCom and governance is commonly retained by the founder of the with a decided interest in Ireland, although company, and by his descendents, even when Hegarty (2002) reports the announcement of the company is large and publicly listed.’ three of the most significant developments in This chapter introduces this perspective in corporate governance in Ireland in many the context of establishing choices for the years. These developments concern the duties application of CorpCom at governance level. and responsibilities of both directors and Pagano and Roell (1998) state that it is quite auditors as well as the creation of the new expensive for a publicly listed company to office of the Director of Corporate Enforce- expand its shareholder base, although there is ment. While these developments are similar a large fixed cost to listing and they argue to equivalent developments in both the that the initial owner is no longer able to pre- United States and the United Kingdom, the vent changes to the identity of his external impetus for each of them pre-dates the recent shareholders. Their argument concludes that if corporate scandals in the United States. Oliver the initial shareholder wants to sell out to (1997) believes that corporate decision many shareholders he must go public. On the making which addresses public relations as a other hand: ‘If he keeps the company private core discipline rather than a marginal one, instead he cannot sell majority status to more produces different outcomes and different than a few large shareholders. As a result he environments in the post-bureaucratic organ- saves the cost of listing the company on the ization of today, even where modern man- Stock Exchange but has to accept a degree of agers remain addicted to administration and monitoring far greater than that which minim- bureaucratization. Strategy-led communica- ises ongoing costs’ (Pagano and Roell, 1998). tion, according to Van Riel, is as essential to an Research into CorpCom, focusing on com- enterprise as prudent strategy-led financial munication of private information and initial directorship. This chapter argues that com- public offerings evaluation in Asia, presented munication may best be implemented if and a discussion (Eng, Khoo and Tan, 1998) on the when corporate communication takes its place role of audit reports as the means of commu- in governance, to underpin the strategic nicating the value of an entrepreneur’s firm to importance of CorpCom, as a strategic support key investor audiences, investment bankers, to its current position as a management (only) auditors, and empirical tests, carried out on function, and this chapter will endeavour to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 address this theory in the context of listed company is perceived by the respondent 2 quoted enterprise and unquoted family to be a family business. 3 owned enterprise. 3 More than 50 per cent of voting shares 4 are owned by a single family group 5 related by blood or marriage and the 6 Family enterprise company is perceived by the respondent 7 to be a family business and one or more 8 There is a shortage of scholarly, informed or of the management team is drawn from 9 academic writing and/or study in the speciﬁc the largest family group who own the 10 areas of corporate communication, and company. 1 governance duty relating to listed or un- 4 More than 50 per cent of voting shares 2 quoted family enterprise. In order to better are owned by a single family group 3 understand the opportunities of functional related by blood or marriage and the 4222 corporate communication at governance in company is perceived by the respondent 5 enterprise (listed or unquoted), it is important to be a family business and 51 per cent or 6 to examine the governance issues in both more of the management team is drawn 7 types of enterprise, and to appreciate the from the largest family group who own 8 historical development of unquoted family the company 9 enterprise. 5 More than 50 per cent of voting shares 20 Research literature on family business is are owned by a single family group 1 limited. Goffee (1996): related by blood or marriage and the 2 company is perceived by the respondent 3 This reﬂects both a bias towards the study to be a family business and one or more 4 of large organisations as well as an assump- of the management team is drawn from 5 tion that within these ownership is widely 6 the largest family group who own the 7 dispersed. Even where it is acknowledged company, and the company is owned 8 that ownership (and control – once the by second generation or more family 9 share structure has been analysed) remains members. 30222 largely concentrated within a single private 1 family, such information is rarely applied to Westhead and Cowling (1997) suggest that 2 explanations of managerial or organisa- many family businesses begin as entrepre- 3 tional behaviour. neurial owners, 4 5 Westhead and Cowling (1997) define a exploiting a market opportunity but failing 6 family company as follows: to develop managerial control systems 7 which can cope with growth. Most will 8 1 More than 50 per cent of voting shares fail as a result of these shortcomings, but a 9 are owned by a single family group small minority may develop the organisa- 40 related by blood or marriage. tional mechanisms necessary to make a suc- 1 2 More than 50 per cent of voting shares cessful transition to managerial ownership. 2 are owned by a single family group From this position, substantial growth – 3222 related by blood or marriage and the often to publicly quoted status – is possible.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors But over time, both entrepreneurial (if they labourers were based/drawn from the local survive) and managerial owners may slip community. In explaining the developmental into the paternal mode often sacrificing and change management role of the family market opportunities in order to sustain enterprise in the eighteenth century in Britain, employment relationships characterised by Habukkuk (1955) in Rose (1995) suggests loyalty and mutual responsibilities. that during the early period of industrialization family firms proved the principal agents The unprecedented contribution throughout of change, their rapid turnover providing the the ages of family enterprise – rather than dynamism which fuelled the growth process. non-family enterprise – is well documented Family firms account for between 75 per (Goffee, Rose, Payne, Habukkuk, Rudding, cent and 99 per cent of all companies in the Chandler, Heath, Neubauer and Lank, Scott, European Union, and for 65 per cent of GDP Westhead and Cowling). This chapter briefly and employment in Europe (Rose, 1995). In endeavours to understand more about this, by the United States, one-third of Fortune 500 beginning at the role of the family enterprise companies are family owned (FT 93). Beyond during the development of the industrial era, Europe and the United States, the family firm examining how the family business enterprise has been, and continues to be, the norm played a key role in it, and by looking at how (Rose, 1995). Family businesses – mostly quoted and unquoted enterprises developed small – are the dynamic in Chinese capitalism in this environment. It also seeks to examine leading to the significant transformation of briefly if communication played any role. Southeast and East Asian economies since the Family businesses, which were instrumental 1970s (Rudding in Rose, 1995). The corpor- in the industrialization of most countries, pro- ate communication function, especially as a vide a continuing important dimension in management tool, is not referred to nor modern economies worldwide (Rose, 1995). specifically mentioned in the literature. Family Payne (1984) in Rose, (1995) reports that in enterprise owners and their managerial hier- the British industrial revolution of the eigh- archies are discussed by a number of writers teenth century the power of heredity and the (Chandler, Heath, Neubauer and Lank) in the vitality of the family as an economic group context of enterprise development. was quite remarkable. Legal, economic and Chandler in Rose (1995) says that due to cultural forces of the eighteenth and nine- the arrival of the large industrial family owned teenth centuries advanced the popularity of enterprise in the west the ease with which the family enterprise, and with the contin- family management maintained itself in uous threat of bankruptcy, the influence of labour intensive fragmented industries was common law partnership and unlimited liabil- highlighted, and that in the capital-intensive, ity meant that many businesses preferred to concentrated industries the recruitment of be associated with their family connec- managerial hierarchies was necessary for tions than with outsiders (Rose, 1995). Rose enterprises to enter markets, survive in them also suggests that the local community was and extend their market share. Similarly the core of the business because business specific facilities and skills were required in activity was localized, the causes of action other operational areas of the enterprise, were local and therefore the boundaries of the e.g. production and distribution. In less com- family firm regarding finance, managers and plex production and distribution processes in

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 smaller enterprises fewer hierarchies were the early days of the United States, including 2 needed, as with capital requirements: rail construction, banking and manufacturing 3 industry (Neubauer and Lank, 1998). 4 This theory suggests that members of the 5 founder’s family were able to have a con- Even after the separation of capital and 6 tinuing say in top management decision management in the nineteenth century, the 7 making as either inside or outside directors owning families continued to ‘call the 8 in less technological less capital using shots’ when it came to directing enterprises 9 industries, and that representatives of at the highest levels. And in this day and 10 banks, other financial institutions and large age, when many of the better known cor- 1 investors had more influence as outside porations are owned by large numbers of 2 directors in the more complex and more dispersed anonymous shareholders (that is, 3 capital using industries. they have lost their family business charac- 4222 (Chandler, in Rose, 1995) ter), family controlled enterprises still gen- 5 erate between 45 per cent and 70 per cent 6 While Chandler makes no specific reference to of GNP of their respective countries. 7 the function of communication as a manage- (Neubauer and Lank, 1998) 8 ment tool, he introduces it indirectly as he 9 explains the hierarchy theory in referring to During the 1980s and 1990s both in 20 capital-intensive industries entering markets, Europe and North America economic reces- 1 and as he distinguishes the directorship roles sions allowed enterprises to drive these 2 of insider and outsider directors in the deci- economies (Neubauer and Lank, 1998). 3 sion-making process of the larger and the Family-controlled and -owned enterprises cre- 4 smaller enterprises. ated jobs, according to Neubauer and Lank 5 Further indirect reference to communica- (1998), and these enterprises were among the 6 tion activity is made by Chandler (in Rose, few that were successful enough to pay taxes 7 1995) as he states that the family owned firm and showed an agility and flexibility necessary 8 persisted in Britain longer than elsewhere pri- to manoeuvre successfully in the troubled eco- 9 marily because entrepreneurs in Britain and nomic waters of their national economies: 30222 Ireland, which was part of the United King- ‘The situation has been similar in other parts 1 dom at this time in history), were reluctant to of the world. In Asia, for instance, family con- 2 make substantial investment in new and other trolled enterprises, with their vitality, elasticity 3 untried processes of production, nor were and tenacity, have driven the (at least until 4 they progressive in their approach to investing late 1997) much admired thriving economies 5 in marketing, distribution, research and facili- of that part of the world’ (Neubauer and 6 ties, and they were reluctant to turn part of Lank, 1998). 7 the enterprise’s administration over to non- Scott (in Goffee, 1996) says that family 8 family, salaried managers. businesses – and no distinction is made 9 Further evidence of the fundamental con- between listed or unquoted enterprises – con- 40 tribution family controlled and owned enter- tinue to represent an important form of work 1 prises have made throughout recent centuries organization within advanced industrial 2 is the huge family fortunes that were estab- economies and suggests that most small and 3222 lished from pioneering economic activities in medium-sized enterprises are family concerns

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors with a small and important number of very 2 leader reactions to critical incidents and large businesses remaining owned and con- organizational crises; trolled by private families that generate half 3 deliberate role modelling, teaching and of all existing and newly created jobs. Goffee coaching by leaders; (1996) reflects on the lack of research litera- 4 criteria for allocation of rewards and ture on family business, stating that there is a status; bias towards the study of large organizations 5 criteria for recruitment, selection, promo- as well as an assumption that within these tion, retirement and excommunication. ownership is widely dispersed: ‘Even where it is acknowledged that ownership (and control) In addition Schein’s culture communication – once the share structure has been analysed – framework has five secondary mechanisms: remains largely concentrated within a single private family, such information is rarely 1 The organizations’ design and culture; applied to explanations of managerial or 2 organizational systems and procedures; organisational behaviour.’ 3 design of physical space, facades and Goffee says there is a need to investigate buildings: further the way in which owners of family 4 stories, legends, myths and parables businesses pursue strategies, which allow for about important events and people; growth and which help them to retain control, 5 formal statements of organizational philan issue relevant in CorpCom management osophy, creeds and charters. and in governance. Goffee introduces the Schein Culture Communication Framework, a Based on a detailed historical review of family model that allows founders to get their own businesses in Great Britain their strengths and approaches and assumptions embedded weaknesses in terms of economic develop- within the actions, thoughts and feelings of ment are discussed and comparison is made others in their business. According to Schein between the performance of independent (1985) (in Goffee, 1996), the process involves unquoted family and non-family companies both conscious and deliberate action in addi- in the United Kingdom. Payne (1984) in tion to that which is unconscious and un- Westhead and Cowley (1997) concluded that intended. Goffee says there is more to passing ‘the large public company, which retains on a family business and ensuring continuity elements of family control may retard eco- than delegation and suggests that the suc- nomic growth; whereas, on balance, the small cess of this process will ‘be shared by the family business possibly promotes economic (largely unexplored) ability of the founder to growth’. create and communicate a workable culture: Daily and Dollinger (1992) in (Westhead one which assists members on coping with and Cowling, 1997) argue that owners of environmental realities’. The Schein Culture family firms are more likely to outperform Communication Framework describes five management controlled non-family firms, and ‘primary mechanisms’ for embedding and Demsetz (1983) (in Westhead and Cowling, reinforcing culture: 1997) justifies and supports this view when he says this is so because owners of family 1 What leaders pay attention to, measure firms are more likely to maximize firm value, and control; enabling them to personally realize any gains.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 on the other hand, professional managers United Kingdom. Binder Hamlyn (1994) (in 2 of non-family firms may not pursue profit Westhead and Cowling, 1997) also noted 3 maximisation and growth or oriented strat- that: 4 egies because they prefer to maximise their 5 own utility function (and realize financial family rather than non-family companies 6 gains for themselves directly) by pursuing were much more likely to desire continued 7 activities which maximise short-run sales independent ownership of the business by 8 revenues. Daily and Dollinger (1992) not selling or floating the business on the 9 found sales growth, improvement in net Stock Exchange. In addition, more family 10 margin and perceived performance relative companies reported a desire to pass the 1 to the firm’s major competitor were higher business on within the family. They inferred 2 in family-owned and managed firms than for the latter group of companies that busi- 3 in non-family firms. ness stability was just as important as 4222 business expansion. 5 Binder Hamlyn (1994) in Westhead and (Binder Hamlyn, 1994, in Westhead 6 Cowling (1997) examined growth sales rev- and Cowling, 1997) 7 enue, employment, exports, productivity 8 and profitability in 667 private unquoted No research exists on CorpCom in family or listed, unquoted family enterprise in Ireland, 9 companies with sales revenues between £2.5 20 although Hegarty (2002) reports on three and £25m, in the period 1988–93, and they 1 significant developments that may have a profound that sales turnover growth in non- 2 found influence in the future on CorpCom in family companies was four times higher than 3 all enterprises. The development focuses on in family companies. Family companies 4 corporate governance and concerns the duties reported a fall of 3.8 per cent in productivity, 5 and responsibilities of both directors and while non-family companies recorded an 6 auditors as well as the creation of a new regu- 7 8.1 per cent increase. No evidence has been latory office – the Directorate of Corporate 8 found that unquoted family enterprises Enforcement. 9 employ CorpCom as a management discipline Heath (1994) argues that since companies 30222 (and that is not to say they do not). There began to increase in size over a century ago, 1 is the opportunity for further research to and with the development of large com- 2 ascertain and evaluate how CorpCom strat- panies, particularly investor-owned corpora- 3 egies, if applied to these types of enterprises, tions (quoted enterprises) employees’ work 4 may impact on their financial and overall had to be supervised and the function of man- 5 performance. aged communication emerged as a necessary 6 Stoy Howard (1989) (in Westhead and management task: ‘As is true of all instances 7 Cowling, 1997) argued that family firms have when humans band together to amplify their 8 other objectives in addition to financial individual efforts, communication was instru- 9 performance targets, and Hay and Morris mental in the endeavour of managers to direct 40 (1984) (in Westhead and Cowling, 1997) activities needed to create, produce and sell 1 suggest that the desire to pass the business on products or to provide services’ (Heath, 2 to the next generation is one of the prime 1994). 3222 financial objectives of family firms in the While not specifying the differences or

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors similarities of quoted (listed) or unquoted the better, and the better you train the people enterprise, Heath (1994) also states clearly in operating a feedback system to create dis- that people are the heart, soul and sinew of cussion, then the better will be the business’s companies: ‘through communication and the performance. creation of meaning they co-ordinate and focus their efforts’ (Heath, 1994). Argenti (1998) turned to Aristotle’s account Standards of the roots of modern communication theory where Aristotle defines the composition of The Conference Board Europe (1999) preface speech and this is later applied to modern a comprehensive study of communication communication needs in the Munter communi- practices by US communication officers in cation theory (Figure 6.1). Munter extends the forty-one industries and businesses with the Aristotle definition to managerial communica- comment that failure to communicate effec- tion and adds two other elements including tively can be a competitive disadvantage, channel choice (or media) and cultural con- and argue that the public, the media, regula- text. Belmiro, Gardiner, Simmons, Santos and tors and special interest groups are intensify- Rentes (2000), when discussing communica- ing their examination of corporate activities tion change in organizations, suggested a and demanding higher levels of accountabil- much higher concern by management to the ity. It is clear that in the early 1990s there was issue of corporate communication: ‘it had concern in financial and corporate America as been constantly suggested that it is better to the valuable function of business informa- over-communicating with the workforce than tion and public confidence in it. The Jenkins missing opportunity for lack of it’. Young and Report, commissioned by the American Insti- Post (1994) in Belmiro, Gardiner, Simmons, tute of Certified Public Accountants (1994) to Santos and Rentes (2000) argue that the more improve the value of listed enterprises, busi- communication the better, the more informed ness information and public confidence in it,

Message

Channel choice

Communicator Audience

Cultural context Response

Figure 6.1 Munter communication theory Source: Mary Munter, Guide to Managerial Communication, 4th edn, (Upper Saddle River, NJ, Prentice Hall, 1997) in Argenti, 1998

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 found that a great deal was right with the pre- returns to the relevant government company’s 2 sent state of reporting in the United States, office (Companies Act, 1963). 3 but identified particular areas open to criti- Corruption in government by unscrupulous 4 cism where feasible solutions were offered. enterprise has come to the fore in some EU 5 Similarly the Research Committee of the countries. Ireland has three major tribunals 6 Institute of Chartered Accountants of Scotland investigating corruption links between politi- 7 (1999) decided to publish a report follow- cians, officials and enterprise on planning- 8 ing their investigation into the needs and bribery issues. Hegarty (2002) has already 9 expectations of expert users regarding corpor- outlined the measures adopted by Ireland, 10 ate information in the United Kingdom specifically. Barnett, Cochran and Taylor 1 (Westman, Beattie, 1999). The ICAS research (1993) report that legal, ethical and practical 2 committee set out a blueprint for future considerations increasingly compel companies 3 reporting practices of linked companies to encourage employees to disclose suspected 4222 (quoted enterprises) focusing on original em- illegal and/or unethical activities through 5 pirical research work into current practices of internal communication channels: ‘Internal 6 users of business information including insti- disclosure policies and procedures have been 7 tutional investors, broker analysts and bank recommended as a way to encourage such 8 leaders. Their findings identified that: ‘the communication.’ 9 analysis of the decision making process identi- Since the 1960s, the corporate governance 20 fied for attention the cycle of communication, battle in the United Kingdom has been 1 the importance of maintaining confidence, focused on accountability of the board and 2 the ability of expert users to explore and sift the system of self-regulation (Walker, Profile 3 data, their selective use of key measures and Magazine, IPR, issue 24, 2002). Walker asks 4 the importance they attach to information whether corporate governance is best 5 about change’. achieved through statutory accountability 6 In the European Union, member states are of the board to the shareholder alone or can 7 required to establish and implement freedom self-regulation ensure the integrity, probity 8 of information acts to ensure greater access and transparency society demands and needs? 9 to information, decisions and provide for For its part, the UK Institute of Public Relations 30222 greater accountability in respect to publicly (IPR) (Profile Magazine, IPR, issue 25, 2002) 1 owned organizations, such as government has welcomed the consultation document into 2 departments, companies run as state owned the relationship between ministers, special 3 bodies, and local government authorities. This advisers and civil servants by the House of 4 approach to openness and accountability Commons Committee on Standards in Public 5 supported by legislation has not yet spread Life. The IPR’s 2002 President, John Aaron, 6 to include enterprises although regulatory said that the role of the so-called ‘spin doctors’ 7 controls on publicly quoted enterprises are needs to be transparent, accountable and clar- 8 established and policed by stock exchange ified as the unregulated actions of a few have 9 organizations. Non-listed enterprise enjoys damaged confidence in the democratic 40 little restriction control to communication responsibility of government and enterprise to 1 and freedom of information access. The only communicate professionally. 2 information/communication requirement gov- For many years there has been a corporate 3222 erned by legislation is to submit brief annual governance debate and considerable concerns

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors expressed, especially in the United States, American Institute of Certified Accountants about the standards of corporate governance (AICA), and this US report focused on partic- (Pike and Neale, 1993). Arguing that it is gen- ular areas open to criticism, and where feasi- erally expected of directors of listed enter- ble solutions could be developed and prises, in terms of UK company law, Pike and implemented. In Europe, and the UK particu- Neale (1993) say that listed enterprise direc- larly, a similar report was commissioned by tors are obliged to act in the best interest of the Institute of Chartered Accountants of shareholders and they point out that there Scotland, ICAS, (1999). This Scottish report have been many instances of listed enterprise discussed the results of their investigation into boardroom behaviour that has been difficult the needs and requirements of expert users to reconcile with this ideal, and they cite listed regarding corporate information in the United enterprise collapses (British and Common- Kingdom (Westman and Beattie, 1999). By wealth Holdings, Polly Peck, Maxwell Com- focussing on original empirical research work munications Corporation) ‘often as a result of into current practices of business information excessive debt financing in order to finance ill users, including institutional investors, bank advised takeovers and fraud’. Other standards leaders and broker analysts, the ICAS Research issues of concern include listed enterprise Committee set out a blueprint for future direction remuneration (Pike and Neale, reporting practices of linked companies 1993). In 1992 the UK Financial Reporting (quoted enterprises). From the analysis of the Council, the UK Stock Exchange and the UK decision making process, the ICAS Research accountancy profession established the Com- Committee identified for attention the follow- mittee on the Financial Aspects of Corporate ing (a) the cycle of communication, (b) the Governance with the brief to examine, and importance of maintaining confidence, (c) the make recommendations on the role of direc- ability of expert users to explore and sift data, tors, executives and non-executives and audi- (d) their selective use of key measures, and (e) tors. Ten key recommendations were made the importance they attach to information and although widely regarded as ‘steps in the about change (ICAS Research Committee, right direction’ these ‘changes’ in the rules 1999). and responsibilities of directors and auditors were non-statutory (Pike and Neale, 1993). This was 1992. Relevance of CorpCom in The year 2002 witnessed major upheaval management in the United States with the Enron and the WorldCom scandals. Throughout the United This focuses on business reporting and clearly States there was major concern in corporate demonstrates the relevance to the manage- and financial sectors during the early years of ment functions of corporate communication. the 1990’s as to the value of business inform- Existing literature defines corporate communi- ation and the confidence people had in this cation in the context of listed (quoted) enter- information. A great deal was right with the prises and places it as a senior management current state of reporting in the United States, function, primarily with ultimate responsibil- according to the latest report, The Jenkins ity being accepted at CEO level (Oliver, Diets, Report (1994), commissioned by the Van Riel, Dolphin).

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Corporate communication involves the by being clear of the need to have a mis- 2 organization’s need to communicate in three sion, the need to create a relationship 3 basic forms: marketing, organization and between strategy and articulate behaviour 4 management (Van Riel 1995). Arguing the standards, managers avoid the superficial 5 management positioning of CorpCom, Van attitude to mission and continue the analy- 6 Riel suggests that communication is an in- sis, thinking and experimentation for long 7 dispensable management tool. Supporting enough to develop the mission that builds 8 the management functionality of CorpCom, ‘a great company’. This is CorpCom at its 9 Dolphin (1999) says that CorpCom is an most basic marginalized professional level 10 approach rather than a technique. but being incorporated as a core activity for 1 line management. 2 It has developed into an essential manage- 3 ment discipline. It is an approach that sets Oliver demonstrates this paradigm shift in the 4222 out to ensure the consistency of the corpor- assessment framework (Figure 6.2). 5 ate message and the transparency of the Openly (1982) (in Heath, 1994) states that 6 organization. It is a function that anticipates information increases identification and he 7 issues, events and crises before they occur. suggests employees identify with an organiza- 8 Through its messages and theme the organ- tion and become committed to it as they feel 9 ization conveys its designed image and they have sufficient information to make deci- 20 person. Thus through commutation the sions. Could this theory be adopted and 1 organization functions, its character and applied effectively to director responsibility in 2 mentality take on a life and form and it terms of the responsibility for CorpCom at 3 becomes known to its various audiences. governance in unquoted and quoted enter- 4 (Dolphin, 1999) prises? For this chapter to propose such a view 5 it is important to address the functionalities 6 Campbell and Yeung in Oliver (1997) pur- associated with governance issues in both the 7 ports that listed and unquoted enterprises, and in family 8

9 4 Range of applications 5 Communication qualities 30222 1 2 3 A national standard for 3 Performance criteria 6 Evidence requirements 4 corporate communication 5 6 7 8 2 The communication process 7 Knowledge and understanding 9 40 1 1 Corporate communication activities 2 Figure 6.2 Assessment framework 3222 Source: Oliver, S. M. (1997)

CorpCom Committee

Finance Director Production Director Marketing Director HR Director Committee Committee Committee Committee

CEO

President COO

VP marketing VP finance VP production VP human resources VP CorpCom General council

Director Director Director Director media investor employee government relations relations relations affairs

Figure 6.3 Ideal structure for CorpCom function model Source: Argenti, P. (1998) Corporate Communication, 2nd edn, Boston, USA: McGraw Hill

unquoted enterprises. In addition, the rela- Argenti (1998) says that a strong centralized tionships between business strategy and function with direct connections to the chief management strategy and corporate com- executive ofﬁcer is the best way for a company munication strategy will be discussed. to ensure the success of its corporate com- There is a lack of literature addressing the munication function. This chapter believes that relationships between governance, and corp- Heath’s theory offers a constructive basis upon orate communication and directorial duty. which unquoted enterprises – drawing on the CorpCom academic literature authors address corporate communication experiences that CorpCom in strictly management terms listed (quoted) enterprises employs – may be (Oliver, Van Riel, Dolphin et al.) and there helped to improve their corporate communi- is opportunity to develop a governance– cation strategies, policies and programmes CorpCom model by drawing on Argenti’s implementation and evaluation practices. Yet ideal structure for CorpCom function model today, when mistrust, confusion and competi- (Figure 6.3). tion lead communication interpretation, how

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Organizational chart of a hypothetical company 2 3 Board of directors, Annual report, house style, corporate advertising 4 5 6 Public relations, press releases, corporate brochure 7 8 9 10 Financial department, Administration, R&D, Personnel department, Legal department, financial publications, client contact, government communication, public affairs, 1 annual report customer settlements subsidies annual social report, environmental 2 personnel adverts problems 3 4222 5 Division A Division B Division C 6 7 Purchasing, Production, Marketing Controller 8 supplier contacts supplier contacts, 9 production 20 communication 1 Sales, client contacts, personal selling, catalogue 2 Marketing communication, print and broadcast adverts, 3 sponsorship, promotions, display direct marketing 4 communication 5 Market research, respondents/clients

6 Production management, packaging, article presentation 7 8 Marketing services, client contacts, complaints settlements 9 Figure 6.4 Organizational chart of a hypothetical company 30222 Source: Van Riel, CSM (1995) Principles of Corporate Communication 1 2 3 can unquoted enterprise view corporate com- management position should be a strong 4 munication as relevant? centralized function directly reporting to and 5 No literature appears to address the rela- connected to the CEO. Many polls taken over 6 tionship between governance, director’s res- recent decades in the United States, says 7 ponsibilities and corporate communication. Argenti (1998), consistently show a huge per- 8 Because CorpCom writers, from Oliver to Van centage of CEOs’ time spent communicating 9 Riel, address CorpCom in strictly management with various ‘constituents’ of the company, 40 terms, the various models (Oliver’s and and he quotes research undertaken by the 1 Argenti’s) offer opportunity to develop a Tuck School of the Fortune 500 companies 2 CorpCom governance model. in the United States that shows CEOs have 3222 Argenti (1998) argues that the CorpCom spent between 50 per cent and 80 per cent of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors their time on communication. Argenti (1998) No academic research could be found that argues that most companies’ CEOs ‘should specifically addresses the roles of the board have a direct link to the corporate communi- of directors in this important field, especially cation function. Without this connection, the as all CorpCom writers address the external communication function will be much less issues, the impacts on CorpCom strategies, effective and far less powerful.’ policy, image, identity and reputation (Oliver, Van Riel (1995) outlines forms of internal Van Riel, Argenti). Listed companies govern- and external communication that might be ance structures offer two options of the posi- employed in a company and he demonstrates tion of the Chairperson and CEO as being held that communication as a management tool is jointly or separately. Where joint Chairperson/ used in many areas of the organization other CEO is concerned we see that Argenti (1998) than PR marketing. cites the management reporting structure to Van Riel (1995) believes that the responsi- the CEO, and where the chairperson is also bility of communication stretches across all the CEO (in listed enterprise) there is obvi- levels of an organization including senior, ously a governance issue to be addressed – yet middle and junior management who use there appears to be no literature to examine communication to achieve desired results, this. Dolphin (1999) addressing corporate and he states that externally, management abstention touches on an apparent common especially the CEO has to be able to accom- approach by companies (listed) in relation modate the vision of the company in order to to meeting the communication need when he win support of external stakeholders (Figure says that some corporations ignore their 6.4). Emphasizing the importance of com- publics altogether: ‘This approach (clearly munication to the success of an organization, stemming from the top) may demonstrate the Van Riel (1995) states that ‘communication is general perception of the CEO and the execu- too vital for organisational success to leave tive committee of the communication func- it solely to managers’ and he argues that tion. It also demonstrates the corporate view experts in communication at various levels of the level of power of strategic communica- and in various areas of expertise may be tion’ (Dolphin, 1999). required and that ‘general managers should Werther, Kerr and Wright (1995) argue that never consider hiring communication experts a key impediment to effective and relevant as the panacea of organisational communica- governance activity may be the CEO who gen- tion’. Van Riel (1995) continues this view by erally controls the information flow to the stating that board and its agenda.

CorpCom is primarily corporate; it only Even if board members pursue an activist subsequently encompasses communica- approach to their responsibilities, their abil- tion; that is to say communication speciality to do so is bounded in large measure by ists must focus initially on the problems of the CEO’s control over the amount and the organisation as a whole (corpus) and type of information they receive. Where only subsequently should they look at the CEO also chairs the board of directors, implicit and explicit functions of communi- control extends to the conduct of board cation with respect to contributions to the meetings. Although the board technically realization of the company’s objectives. has the ultimate power to sack the CEO or

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 to facilitate a takeover, these are extreme by the board to the CEO while the board 2 measures of last resort, more useful in remains responsible for: (1) developing 3 reacting to a crisis than in averting one. corporate policies and plans, (2) monitoring 4 (Werther, Kerr and Wright, 1995) and measuring organizational performance 5 against these policies and plans and (3) acting 6 Boards, usually in response to environmental as a voice of ownership (Taylor, 2000). 7 complexity or competitive turbulence, have Taylor (2000) also argues that it is import- 8 witnessed fundamental restructuring of organ- ant that governing bodies: ‘clearly understand 9 izations, and according to Werther, Kerr and what their role is and is not and that their 10 Wright (1995) these boards have presided primary responsibility is to oversee and 1 over changes designed to improve informa- ensure the achievement of their organisa- 2 tion exchange and decision making dramati- tional mission and strategic ends, which have 3 cally at every organizational level: ‘Yet at the been clearly articulated and are shared by all’. 4222 board level, the critical apex of strategic and Vinten (2000) focuses on recent CorpCom 5 policy concerns, informational and decision- governance concerns including the account- 6 making practices remain embedded in the ability of those in control of companies (listed) 7 structures and protocols of a simpler age’ to those with the residual financial interest in 8 (Werther, Kerr and Wright, 1995). corporate success, normally the shareholders, 9 This conflict between management’s but when the company is approaching in- 20 approach to CorpCom and the potential solvency, then also its creditors, as well as 1 CorpCom responsibility at governance must widening discussion to consider stakeholders. 2 be addressed. Surely it is in the interest (com- Among a number of contemporary develop- 3 petitive advantage, effectiveness, productivity, ments, Vinten (2000) identifies the redistribu- 4 profitability, growth, success, reputation and tion of tasks between the public and private 5 recognition) of firms, listed and unquoted, to sectors, and between public and charitable 6 employ CorpCom strategically, at governance sectors in the economy in the way companies 7 and management function levels? are run and security markets are organized. 8 Governance offers various definitions and Vinten (2000) also suggests as another con- 9 the research exclusively focuses on listed temporary development that issues of public 30222 companies with apparently no evidence or confidence can be assessed in terms of the 1 academic research material addressing level of managerial remuneration and the 2 governance in unquoted family enterprise. effectiveness with which boards of major 3 Tombs (2002) suggests that governance and companies carry out the task of monitoring 4 management are not just about computers executive management. 5 and information. They are about attitudes and Werther, Kerr and Wright (1995) refer to 6 management culture mixed with information. the attacks on the board’s role in Corporate 7 Taylor (2000) quotes Bohen’s (1995) defini- governance and include cronyism, inappropri- 8 tion of governance as ‘the responsibility ate remuneration and executive compensa- 9 and accountability for the overall operation’ tion schemes. All these issues fall into 40 of an organization and he says that ‘boards are reputation, and are directly within the field of 1 always charged with this level of responsibility CorpCom, which is inherent in the functions 2 and accountability’. He further suggests that of corporate governance yet there is no evi- 3222 the managing part is further delegated dence nor academic research to demonstrate,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors question, debate the judiciary functions of If, as Van Riel (1994) argues, strategy-led com- directors in either listed or unquoted (family) munication is as essential to an enterprise as companies, irrespective of size. prudent strategy-led financial directorship, This chapter contends that opportunity then there is a need for further investigation exists for the elevation of CorpCom from its into the development of governance CorpCom current exclusive role in management to also in listed enterprise, particularly as support to be an essential governance function. The the functionality of CorpCom in management. Cadbury Report (1992) clearly identified In addition, the limited qualitative research the preferred appropriate structures – board process (which this author is undertaking) in committees involving both directors and unlisted family enterprise needs to be further non-executive directors. No literature research researched in greater detail across a variety of was found in relation to governance and different enterprise types, as does research of the management function of CorpCom in a similar nature require to be undertaken in unquoted family enterprise. In addition, no state-run enterprises. It is the author’s opinion evidence was identiﬁed regarding CorpCom the similarities and differences in CorpCom strategy, policy or programming at manage- strategy, policy and programming, the need ment levels in unquoted family enterprise. and role for governance–CorpCom, and its relationship to the organization’s mission, and business objectives may provide interesting Further research ﬁndings in terms of the future development of CorpCom as a core element for an organiza- One key area for further research is suggested: tion’s (listed and/or unlisted) success, survival, CorpCom at governance in listed enterprise. growth and wealth.

REFERENCES

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Grunig, J. E. (1992) Excellence in Public Relations and Tombs, K. (2002) ‘What do we mean by governance?’, 2 Communication Management, New Jersey: Records Management Journal, 12(1), 24–8. 3 Lawrence Erlbaum Associates. Townley, P. (1993) ‘Managing corporate communica- Heath, R. L. (1994) Management of Corporate Com- tions in a competitive climate’, The Conference 4 munication: from Interpersonal Contacts to External Board of Europe, Report 1023, Brussels. 5 Affairs, New Jersey: Lawrence Erlbaum and Van Riel, C. B. M. (1995) Principles of Corporate Com- 6 Associates. munication, Hemel Hempstead: Prentice Hall. 7 Hegarty, S. (2002) ‘Corporate governance develop- Van Riel, C. B. M. (1997) ‘Research in corporate com- 8 ments in Ireland’, Corporate Finance, Supplement munication: an overview of an emerging ﬁeld’, 2, 113, 22–4. Management Communication Quarterly, 11(2), 9 Neubauer, F. and Lank, A. G. (1998) The World of 288–309. 10 Family Business, London: Macmillan Press. Varey, R. J. and White, J. W. (2000) ‘The corporate 1 Oliver, S. (1997) Corporate Communication: Principles, communication system of managing’, Corporate 2 Techniques and Strategies, London: Kogan Page. Communication: An International Journal, 5(1), 3 Oliver, S. (2001) Public Relations Strategy, London: 5–11. Kogan Page. Vinten, G. (2000) ‘Corporate governance: the need to 4222 Pagano, M. and Roell, A. (1998) ‘The choice of stock 5 know’, Industrial and Commercial Training, 32(5), ownership structure: agency costs, monitoring 173–8. 6 and the decision to go public’, The Quarterly Weetman, P. and Beattie, A. (1999) Corporate 7 Journal of Economics, 113(1), 187–225. Communications: Views of Institutional Investors 8 Pike, R. and Neale, B. (1993) Corporate Finance: Going and Lenders, The Institute of Chartered Account- Public and Issuing New Equity and Takeovers, 9 ants of Scotland. Mergers and Disposals, London: Butterworths. Werther, W. B., Kerr, J. L. and Wright, R. G. (1995) 20 Quirke, B. (1995) Communicating Change, London: ‘Strengthening corporate governance through 1 McGraw-Hill. board level consultants’, Journal of Organisational Rose, M. B. (1995) Family Business, Aldershot: Edward 2 Change Management, 8(3), 63–74. Elgar. 3 Westhead, P. and Cowling, M. (1997) ‘Performance Schein, E. H. (1985) Organizational Culture and 4 contrasts between family and non-family Leadership, San Francisco: Jossey-Bass. unquoted companies in the UK’, International 5 Taylor, D. W. (2000) ‘Facts, myths and monsters: 6 understanding the principles of good govern- Journal of Entrepreneurial Behaviour and Research, 7 ance’, International Journal of Public Sector 3(1), 30–52. 8 Management, 13(2), 108–24. 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

J. Paulo Kuteev-Moreira and Gregor J. Eglin

What is the role of corporate communication professionals at a national level health service and at a local government level? What are the major challenges to decision making faced by executives and politicians? The chapter puts into context the speciﬁc reality of hospital corporate communication within contemporary public service systems and identiﬁes areas of further research and professional development. It also addresses communication change practices in local government through major issues of public policy, such as transport.

A changing healthcare • health as a fundamental human right; environment • equity in health and solidarity in action between countries, between groups of The policy for ‘Health for all in the twenty- people within countries and between first century’ (HEALTH21) adopted by the genders; world community in May 1998 and promoted • participation by and accountability of indi- by the World Health Organization (WHO) sets viduals, groups, communities, institutions, out for the ﬁrst two decades of the twenty-ﬁrst organizations and all sectors in the health century global priorities and targets that development movement. will create the conditions for people worldwide to achieve and maintain the highest Four major strategies for action have been attainable level of health throughout their selected to ensure the implementation of lives. The regional policy for Europe was a HEALTH21: response to its call for regional and national adaptations on the basis of the global one • multisectoral approaches to tackle the (WHO, 1999). determinants of health, taking into The ethical foundation of this strategic account physical, economic, social, cul- policy for the healthcare sector is constituted tural and gender perspectives and ensure by three basic values (WHO, 1999: 4): the use of health impact assessments;

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • health-outcome-driven programmes for (1997). This method suggests two funda- 2 health development and clinical care; mental strategies for change: 3 • integrated family-and-community orient- 4 ed healthcare, supported by a flexible and 1 consensus building (resistance reduction) 5 responsive hospital system; 2 building implementation. 6 • participatory health development pro- 7 cess involving relevant partners for health The strategic process of consensus building 8 at all levels – home, school, worksite, involves a number of alternative actions 9 local community – and promoting joint amongst which we emphasize, in the corpor- 10 decision making, implementation and ate context of hospitals, the following: 1 accountability. 2 • Stakeholders should be consulted to find 3 This strategic vision has been adapted by all out how they perceive the changes to 4222 EU member states and it is now incorporated affect them; this will help in defining 5 in its national health systems’ policies and messages to minimize apprehension and 6 priorities for action. anxiety by acknowledging their concerns 7 However, the implementation of these four and preferred options. 8 major strategies demands change in the shape • The need for change should be felt (perceived as necessary) and complemented 9 of new processes of healthcare delivery. This 20 by the availability of explanations of the goal runs into difficulties in a number of 1 purpose of the change. This should mini- healthcare sectors whose strategic interests 2 mize hostility and/or resistance. may not coincide with some of the HEALTH21 3 • Generating positive support for change is proposals. 4 possible if the corporate communication In this context, managing policy implemen- 5 professionals are able to make clear to tation requires a range of complex skills. It 6 stakeholders the benefits that some partic- 7 involves assessing the environment or circum- ular change will bring to them. 8 stances in which the policy will operate, not • Alliances should be built that support 9 only to identify possible barriers preventing change, if necessary excluding, for some 30222 implementation but also to find supporting time, those stakeholders who are resis- 1 arguments or actors to facilitate the change tant. 2 process. • A clear plan of the change process should 3 In order to understand and influence the be disseminated within the stakeholders 4 environment in favour of the new policy, the of the organization and include a clear 5 technical ability to manage implementation identification of: tasks, responsibilities, 6 involves the adoption of a set of essential resources required and training and 7 corporate communication tools and corre- development needs. Expected outcomes 8 sponding skills. The confirmation of this and a number of milestones against which 9 premise becomes more evident when we con- to monitor progress should be communi- 40 sider the principles of the accordion method cated at an early stage of the process. 1 as developed by Ansoff and McDonnell 2 (1990) and put into the context of European The second strategic approach to change 3222 healthcare reforms by Saltman and Figueras in the hospital sector is that of building

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors implementation which implies three major of the changes expected to achieve complementary measures to consensus build- HEALTH21 and related reforms. ing: In this context, we are now going to look into some fundamental corporate communi- • The change process should be incremental cation competencies which need to be devel- over a period of time and begin with oped if the corporate communication function the least contentious changes. As trust is to contribute to that process. The following amongst stakeholders builds up, the more sections discuss four levels of corporate com- controversial aspects may be introduced. munication challenges for practice within the This will demand image management hospital environment: throughout. • Stakeholders should be involved (or per- 1 professional and personal; ceived as such) from the beginning. 2 communication with internal audiences; Rewards to support can be communicated 3 communication with external audiences; but those who resist should not be penal- 4 preparing for critical media reports. ized, since entrenching their resistance may prevent the building of implementation. Professional and personal • Stakeholders should be informed about challenges progress. Evaluating the effects of change and communicating them will allow The hospital corporate communication stakeholders to see the promised benefits function implies communicating with a wide and maintain their support. array of very different people on a daily basis: board members, medical, nursing, technical, From this conceptual framework this chapter administrative and clerical staff, volunteers, argues that the corporate communication patients and patients’ families, representatives management function is central for the suc- of governmental and other health or social cessful implementation of change in European organizations, community healthcare-related health systems in general and in healthcare organizations, professional organizations, organizations (hospitals) in particular (i.e. suppliers, potential suppliers, local politicians, NHS hospitals). the media, etc. Thus, whilst considering the application of As each of these groups has a different communication tools and techniques to help purpose to establish at the encounter, it the hospital develop and maintain positive becomes necessary to learn about their expec- relationships with its audiences, we realize tations. This is the first step to understanding that this purpose demands expertise at all the nature of the hospital corporate culture. levels of corporate communication: inter- One set of skills required here relates to our personal, groups, operational and strategic own (inter)personal communication practice: (see Oliver, 1997). listening and negotiating skills, assertiveness Hence, as noted above, consensus building and one-to-one communication. and building implementation are two funda- Communicating within the hospital organ- mental strategies to support change as they ization demands further practice and develop- define clear priorities for the implementation ment of personal skills like those related to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 communicating in meetings, making presenta- options for written communication, we need 2 tions and developing networks within a con- to develop a practical understanding of effec- 3 text of rather volatile and conflicting group tive writing for all of them. 4 expectations and opinions. Bearing in mind the paramount assump- 5 In fact, in a corporate environment where tion that we write to get a response from 6 the daily pressure, conflicting group and indi- the reader, the absence of response to our 7 vidual attitudes and different professional writings may anticipate a communication 8 approaches to problems hamper most breakdown. When a communication break- 9 prospects of peaceful and stress-free commu- down occurs in the hospital corporate 10 nicational encounters, networking becomes a environment, its direct effects may become 1 strategic priority for the development of a visible through a series of critical problems: ill- 2 corporate communication role. If we are able informed patients and families, over-worried 3 to develop a network of people who are relatives, increased complaints, dissatisfied 4222 aiming for a common goal we then have a staff, bad publicity, suspicious journalists, loss 5 powerful tool to do our job and help in of staff morale or falling productivity. 6 achieving corporate objectives. Being part of In this context, a good understanding of 7 an internal network in the hospital has the our readers (audiences), a clear idea about 8 following practical advantages: our messages and a capacity to adapt mes- 9 sages to different audiences (e.g. transform 20 • provision of relevant comments, sugges- clinical, technical or management information 1 tions and advice; into plain English) and adjust them to differ- 2 • recognition of possible impact and group ent written formats, become fundamental 3 reactions prior to acting; skills for the corporate communication profes- 4 • a sounding board for clarifying ideas and sional in the hospital environment (see also 5 strategies; 6 Albert, 1997). 7 • extension of support and influence; 8 • streamlining working relationships; 9 • improved information flow and know- Communicating with internal 30222 ledge management. audiences: the hospital groups 1 2 Another fundamental challenge is that of writ- Involvement in the hospital corporate envir- 3 ten communication. Contemporary national onment is about maximizing the capacity to 4 health systems face a massive multiplication create and develop functional networks that 5 of quantities and formats of written mater- promote and guarantee positive interpersonal 6 ials published and exchanged via a whole communication between all professionals. 7 range of channels and technologies: reports, By assisting the development of internal 8 letters, memos, minutes and agendas, brief- networks, the unifying energy arising from 9 ings, posters and notice boards, patient people who collude in contributing to achieve 40 information leaflets, magazines, bulletins, the delivery of a complex service through 1 newspapers, books, faxes, emails, pager mes- which lives may be saved, we strengthen 2 sages, web pages, speeches, press releases, the role of the corporate communication pro- 3222 backgrounders, etc. In view of all these fessional in the hospital environment. This is

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors one major objective to aim at whilst develop- who are concentrated on the activities and ing any course of action to communicate with concerns of the particular function or depart- internal audiences. ment to which they are assigned rather than Most of today’s hospital professionals can on what is happening in other parts of the be described by pointing out their major organization. This corporate reality creates shared characteristics: they are highly edu- team loyalty but tends to question their indicated, ‘territory oriented’ and very sceptical vidual empathy with the whole organization. about managers (including the corporate This situation adds to the difficulty of creating communication manager). In fact, within the a shared corporate set of values and behav- hospital environment, it is likely that the corp- iours in the hospital environment. In this orate communication person is one individual manner, contributing to effective networking amongst a number of strongly self-aware becomes a fundamental purpose for the role groups of healthcare professionals each possi- of corporate communication as a means to bly comprising hundreds of individuals with achieving improved shared corporate values their own predefined ‘territories’ and ‘corpor- by bringing together people from different ate’ (group) priorities. The majority of them professional groups and departments. will be women (especially in healthcare deliv- One could describe the organizational cul- ery) and increasingly from multicultural back- ture of hospitals as ‘extremely heavy’. That is grounds. to say, it encompasses a diversity of identities Hence, these professionals are likely to be and establishes a sense of commitment at two wary of anybody perceived as representing different levels: commitment to the profes- the board or the administration, as is the case sional healthcare group of origin; and/or com- with the corporate communication person. mitment to the organization as a whole. The The fact is that healthcare professionals share stability of this double identity/commitment a very strong group identity and some con- will depend on the corporate communication temporary proposals for change arising from function being able to demonstrate the managers question some of the shared group complementary nature of both (see Harrison values and/or priorities (see Harrison et al., et al., 1992). The inability to achieve this 1992). Having said all this, can it become purpose will tend to result in conflict and dis- more challenging for the corporate communi- regard for any effort promoting participation cation practitioner? Yes, it can. and commitment in activities relevant for In fact, pressures on the healthcare system the whole but irrelevant to its parts (the pro- include budget strains, litigation and increas- fessional groups). ing citizen demands. On the other hand, the Adapted from Huber (1996), who built surge of new technology-related professions from several earlier studies, we can identify demanding similar status to that of physicians some major guidelines for the process of and nurses is another communicational chal- building a corporate culture supportive of the lenge as the recognition of that status (or the need for constant change faced by contempor- lack of it) is a potential source of conflict ary hospitals. between other hospital professional groups and the board. • Messages should start from where our Within large and complex organizations internal audiences are in their under- such as hospitals, it is natural to find people standing of the issue.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • Promote the practice (at board and senior • to establish the perception that ‘change 2 management level) of an open style of for the better’ is possible (‘it has been 3 communication by encouraging discus- achieved elsewhere or even among us’); 4 sion. • to disseminate examples of ‘change for 5 • Invest time and effort on interpersonal better’ which occurred in other depart- 6 communication: one should meet people ments or hospitals (even in other coun- 7 in their department and avoid hiding tries); 8 behind email and phone. • to make the need for change perceived as 9 • Identify the shared vision of each group, necessary and inevitable; 10 build statements of mission that comply • to disseminate explanations of the pur- 1 with those ‘visions’ and then make an pose of change in order to minimize hos- 2 effort to ‘fit’ the values desired for the tility and/or resistance (adapt this purpose 3 whole within their ‘partial visions’. to different groups); 4222 • Promote the empowerment of each pro- • to generate positive support for change by 5 fessional group by valuing and facilitating making clear to groups the benefits that 6 interaction, co-operation and developing some particular change will bring to each 7 the sense of influence of the group over one of them; 8 the whole of the organization. • to disseminate a plan for the change 9 process within all groups of the organiza- 20 Further to this, we must also acknowledge a tion; this plan should expose the tasks, 1 unique group in hospitals: that of the volun- responsibilities and resources required; 2 teers. Their function may not always be very • to inform all groups about specific out- 3 well defined or known at department level, comes against which the progress of 4 leaving scope for unhelpful events pertaining changes can be monitored. 5 to their relationship with the work of other 6 healthcare professionals (especially nurses Hence, with regard to specific challenges to 7 and ancillary personnel). Our challenge here do with the hospital internal audiences, we 8 is to promote their good (group) relations must be aware of the unique complexity of 9 especially with nurses and ancillary personnel. relationships established in a healthcare team 30222 Volunteers need to feel rewarded in other (see Figure 7.1). Inevitably the physician is at 1 ways than monetary. Thus, group self-esteem the heart of the team’s propelling energy. In 2 uplift tends to be our operational communica- spite of the fundamental contribution of all 3 tion theme with this group. Hence, volunteers the other professionals, the number of con- 4 become a very important network as they can tacts and requests in the process of patient 5 become the extra ‘eyes and ears’ of the corp- care directed to the physician is by far higher 6 orate communication professional. than any other member of the healthcare 7 Once we have acknowledged the diversity team. This fact has three strategic implications 8 of internal audiences, we need to consider the for practice: (1) do not send a physician 9 purposes of communicating with each one of information or request it, if the matter is not 40 them. In this sense, we recall the above priori- important to him/her; (2) until proven wrong, 1 ties for consensus building and point out assume that the physician is the most influen- 2 some likely purposes in communicating with tial member of the healthcare team (for the 3222 hospital internal audiences: good and the not-so-good); (3) in spite of the

The administrator The therapist

The physician

The technician The midwife

Figure 7.1 Internal audiences – one example of a The pharmacist The social worker healthcare team former being true, never underestimate the sometimes result contradictory service organ- influence of other professional groups; izational priorities. Non-care customers are all those entities to which a hospital may provide non-care ser- Communicating with external vices such as renting space to shops in its audiences: the hospital premises (e.g. flower shop, bank, post office, stakeholders cafeterias, etc.). Purchasers (or contractors) are also per- Healthcare organizations have a number of ceived as customers since they pay (or con- stakeholders who confer on these organiza- tract) for the services delivered by the tions dedicated to caring for people a unique hospital. In the European Union these take corporate communication environment. The different names within the variable ministry following are the major stakeholders of con- of health departments, such as health author- temporary hospitals. ities, contracting agencies or authorities, Patients and service users are the essence of health boards, primary care groups or trusts, the hospital’s activity. The hospital was cre- social services, as well as health insurance ated and established to serve them, to satisfy companies or other life and healthcare their needs, to guarantee their well-being at private contractors. As the trend towards joint all times and to promote harmonious contacts private–public investment in healthcare takes with its premises, technologies and staff. Here over, this type of stakeholder will become we include patients’ families and friends (i.e. increasingly relevant for the corporate com- visitors). munication practice. Even when one works Organizations representing patients and ser- in a public hospital we may have services vice users are all those non-governmental and for private patients, usually purchased by voluntary organizations which act as insurers. conciliators and negotiators between the Regulators are responsible for evaluating specific needs of groups of citizens suffering whether the service provision achieves the from a certain clinical condition or socio- predefined quality standards. All over Europe demographic characteristic and the hospital’s we see that forms of professional and service corporate environment within which may regulation take either a national standards

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 approach or a more local-based regional regu- hospital’s reputation becomes fundamental 2 lation, usually oriented towards specific local to assist or damage staff recruitment pro- 3 needs and service delivery. grammes. 4 Partners are all other organizations with Trade unions and professional associations are 5 which the hospital collaborates in delivering stakeholders whom hospitals find themselves 6 services. Typical partnerships may include dealing with over educational or training mat- 7 sharing technical expertise or co-ordination ters or over wage or productivity incentives 8 of service delivery with primary care organiza- demanded by or offered to staff. 9 tions and diagnosis services (e.g. clinical The media must be considered a stake- 10 exams, radiology, etc.). There is increasingly holder in the sense that they are partners 1 the need to establish partnerships with other who are always very interested and aware of 2 service areas like homecare organizations, critical events occurring within the hospital 3 community health organizations or the social environment. In fact, the media know that 4222 services. every hospital is a prolific ‘supplier’ of news 5 Suppliers are the organizations from which (good and bad) especially captivating for its 6 the hospital buys goods and services – from audiences (local and national). As in many 7 pharmaceuticals and healthcare disposables cases events at the hospital relate to the 8 to high-tech equipment, domestic services ‘human-feature’ kind of stories, sometimes 9 and management consultancy. even politically sensitive, we must accept and 20 Competitors/rivals are other organizations be prepared for a variable but enduring 1 providing healthcare services (with public or media interest and thorough scrutiny. Besides, 2 private ownership). If these services are per- as is the case in numerous proposals for 3 ceived by regulators or patients and service change, the media become the most effective 4 users as actual or potential alternatives to and powerful source of information for hospi- 5 services provided by our hospital, they consti- tal stakeholders and internal audiences. 6 tute competition. Hospitals which can demon- Contemporary media not only inform but, 7 strate high and increasing numbers of users most important, also disseminate interpreta- 8 are more likely to guarantee continuing fund- tions, promote opinions and debate about the 9 ing and investment whether from public or changes being proposed or implemented. 30222 private bodies. On the other hand, besides One may have been surprised at how many 1 attracting patients and service users, hospitals different groups of stakeholders can be identi- 2 are increasingly under competitive pressure fied as having an interest in the corporate re- 3 to attract and retain scarce specialized and ality of hospitals (Figure 7.2). 4 highly skilled professionals who may prefer The diversity of stakeholders identified in 5 some other hospital or similar healthcare the hospital organizational environment is a 6 organization. major factor contributing to its complex 7 The labour market of the health professions corporate communication challenges. For in- 8 is made up of individuals who actually possess stance, when the board wants to change one 9 the skills and knowledge needed for the aspect of a service delivered by the hospital, 40 activity of the hospital. Within the healthcare each stakeholder may, from its particular 1 professions the legal and suitable qualifica- perspective, take a view of the proposed 2 tions needed for the clinical and nursing activ- change. The board may see the benefits to 3222 ities are especially scarce. In this context, the be gained from such change, but some of the

Organisations representing Trade unions and professional patients and service users associations

Purchasers/contractors Hospital ‘Competitors’/rivals Labour market

Suppliers Regulators

Media

Figure 7.2 A stakeholder environment: the contemporary hospital stakeholders may emphasize its disadvantages information, technology and, not least, that of and propose a different way of achieving sim- reputation. ilar benefits. Thus, it is useful to consider what may be As the interests and priorities of stake- the scarcest resource in a particular hospital holders will vary according to circumstances, context. It may be skilled professionals – we need to take these into account before we including staff with the soft skills pertaining to communicate a proposed change. Only after interpersonal communication with patients considering the nature of the change and its and families. In other contexts, the scarcest impact from a range of different stakeholders’ resource may be hospital beds, community perspectives is it possible to foresee how each services or simply the money to acquire a group perceives it and anticipate their attitude particular piece of hospital machinery. and behaviour. This approach is fundamental Some resource shortages may be resolved to facilitating the subsequent decisions on by ‘simply’ making more money available. message strategy development. This is usually one solution demanded The awareness of this circumstance leads us by some sectors of contemporary western further towards the understanding that the societies (hospital stakeholders). However, the contemporary relationships between a hospi- ‘budget cutback’ discourse is dominant in the tal and its stakeholders are strongly influenced vast majority of western healthcare systems. by the choices and constraints pertaining to Yet, few have managed to invert the trend of the availability of the resources that the escalating healthcare budgets and expenses organization needs to operate effectively. (see Saltman and Figueras, 1997). Such an analytical approach, as developed The balance between alternative ap- by Pfeffer and Salancik (1978), is called the proaches to solve resource scarcity in health- resource dependence view. It suggests that care (usually associated with two contrasting no organization is completely independent. political views), is sometimes achieved either In fact, organizations rely on a number of by finding alternatives to the particular scarce fundamental resources – financial, personnel, resource (e.g. new rules of financing health-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 care to overcome money shortage; or hiring In fact, any hospital may adopt one or 2 foreign nurses to overcome shortage of nurs- more of these strategies to ensure access to 3 ing staff) or by changing processes of delivering scarce resources. However, whatever alterna- 4 care (e.g. delivering healthcare at home is less tive is taken by the board of directors, there 5 expensive and potentially more positive to the will always be varying support from the vari- 6 well-being of the patient; carrying minor surg- ous stakeholders. There may be those who 7 eries in GPs’ surgeries to overcome hospital will support at one end and those who may 8 beds shortages). Any of the alternatives is be fundamentally opposed at the other end. 9 likely to imply conflict with particular stake- In this sense, it is crucial that the course of 10 holders. action of the corporate communication pro- 1 The resource-dependence view also main- fessional keeps in mind the strategic essence 2 tains that the attempts to solve resource short- and principles of consensus building (resis- 3 ages oblige the organization to change the tance reduction) and building implementa- 4222 balance between its dependencies. As sug- tion (see above). 5 gested by several authors (see Harrison et al., Yet, as conflict with stakeholders occurs, the 6 1992; Pfeffer and Salancik, 1978), this new media become a central stakeholder since 7 balance of dependency may be achieved by they are a major receptacle for reporting 8 one or a combination of four strategic alterna- problems at the hospital. Many hospital issues 9 tives: reported by the media occur due to some kind 20 of communication breakdown with one or 1 • adapt to the conditions (e.g. influence more of its stakeholders or with one of its 2 demand of services or its delivery); internal audiences (i.e. professional groups) 3 • alter its interdependencies (e.g. merger who use the media as their advocate. That is 4 with an organization that controls some of the subject of the following section. 5 the scarce resources or growth by devel- 6 oping new services/products so that the 7 organization is no longer dependent); Preparing critical media reports 8 • negotiate environmental conditions (e.g. 9 create partnerships to deliver joint ser- As healthcare reforms become more complex 30222 vices or share resources, for instance with and ubiquitous, the purpose of maintaining 1 social services, voluntary NGOs or even stakeholders on good terms with the hospital 2 the private sector) becomes even more challenging. The com- 3 • change by political action (e.g. lobbying plexity of corporate communication practice 4 politicians to obtain subsidies, favourable is most evident when we reflect upon the 5 regulation and contracts). media approaches to events affecting the hos- 6 pital. What the media typically report and 7 Clearly the implementation of any of the four what challenges for practice arise from it, is 8 possible ways to change organizational one contribution to debate intended from this 9 dependency in the hospital sector demands section. 40 good (public) relations with all its stake- Table 7.1 presents a set of typical categories 1 holders (see Figure 7.2). This fact emphasizes of press reports pertaining to hospitals. We 2 the strategic role of the corporate communica- need to draw a parallel between these cate- 3222 tion function in the hospital environment. gories and particular key stakeholder(s) with

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors whom a communication breakdown may Management failures occur. In other words, we need to understand the nature of typical media reports and relate These represent a form of media coverage in them to specific communication efforts which hospitals (especially NHS hospitals) are required to satisfy the needs and expectations reported to have failed to achieve one or of stakeholders affected by any category of more of their major social purposes. A hospi- media reporting. As media reports alter stake- tal may have failed to grant access to health- holders’ perceptions, we need to identify the care (e.g., being unsuccessful in granting this key stakeholders affected by each category so fundamental human right by extensive and that we can plan preventative measures and long waiting lists), or may have fallen short of procedures. Emerging from empirical data, its social accountability (e.g. unexplained (Moreira, 2003; Henry, 2002) we identify a financial mismanagement) or even been number of critical hospital press reports. An accused of wasting resources (thus question- introduction to these is presented below. ing its contribution to solidarity). Keeping

Table 7.1 Categories of press reports

Category Categories of critical media reports Key stakeholders (with whom to prevent communication breakdown)

A Management failures Patients and service users This includes: waiting time, waiting lists, ﬁnancial Organizations representing users mismanagement and waste Purchasers/contractors B Clinical errors Patients and service users Including iatrogenesis (clinically induced health Organizations representing users problems) Purchasers/contractors C Professional corporate conﬂicts Unions and professional associations Patients and service users D Staff shortage Labour market Professional associations E Community relations Organizations representing patients and service users Purchasers/contractors F Corporate events Organizations representing patients and service users Labour market G Human stories (features) Media Patients and service users H Community abnormal accidents Patients and service users I Community violence Patients and service users J Introduction of new hospital technologies, therapies Patients and service users or clinical pathways Organizations representing users Purchasers/contractors Suppliers K Hospital originated pollution All stakeholders

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 patients and service users (and their repre- of clinical/legal measures to be taken and/or 2 sentative organizations) updated on the real invite the individuals involved (e.g. patient or 3 capacity of the hospital will help in dissemi- family) for a meeting at the hospital so that 4 nating realistic expectations. For this purpose, personalized first-hand information on their 5 specific corporate media development will be case may be provided (rather than inform 6 fundamental (e.g. waiting list newsletters) as them through the media). However, a whole 7 well as implementing open proactive informa- set of legal constraints which regulate these 8 tion flow procedures directed at the media cases need to be taken into account. 9 (especially local) so as to disseminate what the 10 evolution of waiting lists/waiting times is in 1 the various hospital departments. The fact Professional corporate conflicts 2 that the media may compare one hospital’s Strikes are the most acute instance of such typ- 3 data with that of other hospitals will demand ical media reports. Often this type of conflict 4222 an argumentative capacity to justify and place occurs at national level (e.g. the unions versus 5 progress in the local context (e.g. refer to local the health minister) so it may not involve any 6 epidemiological data). This approach hospital in particular (except on reports con- 7 enhances the purpose of accountability. firming how many professionals adhered to 8 Concerning the scarce resources dilemma, the strike at that hospital). On other occasions, 9 reports may originate from the reaction of however, conflict may occur at hospital level 20 some stakeholder to a change in the balance between a group of professionals and its 1 of the hospital dependencies (see previous board of directors. In these situations we face 2 section). However, the perception of solidarity a divided hospital and a complex challenge to 3 should never be questioned. All resource re- practice: whose side are we going to be per- 4 allocation must be explained under the ceived to be on? From whose point of view 5 patient’s best interest and, if the media are to are we to pass information to the media? Are 6 report on it, it needs to be presented from the there any views likely to ignite conflict and 7 patients’ and service users’ point of view. involve other stakeholders? 8 Complex management points of view are very 9 unlikely to be conveyed by media reports. 30222 Staff shortage 1 2 Clinical errors This type of media reporting is broad and gen- 3 eral. Media usually refer to it as a national 4 These are usually grave reports on events issue although sometimes may refer to the 5 affecting a particular individual. Events may situation at one particular hospital as the evi- 6 be perceived to have been caused by poor dence of one such national problem. Nurses, 7 clinical performance undertaken by one (or some medical specialists and specialized tech- 8 more) hospital healthcare professional. The nicians are amongst the professionals usually 9 role of the corporate communication person reported to be in shortage. Again the princi- 40 in these cases may be to gather specific ples presented in the previous section suggest 1 data on the case (e.g. already published), help possible strategies the hospital may adopt to 2 clinical staff to prepare a public clinical overcome this particular resource scarcity. 3222 explanation adding a possible announcement Disseminating an interest in working at our

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors hospital as advocated by the professionals to create fine-tuned events for the generalist themselves may be a major contribution media. However, it is also a fact that clinical, expected from a corporate communication nursing, hospital technology and healthcare professional. management events usually get good coverage from specialized media. Community relations Human stories (features) Problems pertaining to the level of co-ordination and integration of healthcare within local Typical reports in this category include the communities are another major area of ‘miraculous hospital intervention saves baby’ reporting. In this context, integrating hospital kind of story. One should not try to generate levels of healthcare management (e.g. sec- this type of media reporting proactively as ondary, tertiary) with those of primary care medicine is not an exact science. Once the (e.g. healthcentres or GPs’ practices) in order media initiates a story of this kind one can to grant the best patient flow becomes a never be sure how it will end. Physicians are major pressure to share resources between usually the ‘stars’ of these stories. Promoting social and healthcare organizations. The grow- the fact that these physicians work at the ing complexity of care and the strained finan- hospital is the most certain benefit the hospi- cial system put pressure on hospitals to come tal can expect from this category of media to grips with the need to plan and manage reporting. integrated care plans. These need to include social care organizations and services (e.g. home care, meals on wheels, social alarm) in Community abnormal accidents co-ordination with recent approaches to healthcare services (e.g. telemedicine, tele- Traffic and road accidents involving a large care). Any breakdown in these complex caring number of people, fires, floods or other types networks can have dramatic consequences for of disasters are the nature of this category of individuals and are of boundless interest to hospital reporting. In these situations it is fun- local (and sometimes national) media. damental that corporate communication professionals gather accurate information and facilitate the flow of data to the media (at any Corporate events time of the day or night). By preparing a good speaker (clinical or not) to announce numbers As in any other area of corporate commun- and clinical progress of the victims it can ication practice, corporate events are a become an excellent opportunity to project a favourite approach for originating positive positive professional image of the hospital. press reporting for corporations. In the hospital environment, this is not so for the media themselves, unfortunately. In fact, it is not Community violence easy to get media to cover hospital corporate events. One needs some imagination and a Victims and offenders of community violence deep understanding of the nature, essence tend to end up at the hospital at some point. and culture of contemporary media to be able Again, in these situations, media reporters are

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 eager to get up-to-date information and the values of healthcare and the (sub)culture 2 details (e.g. areas of the body wounded, of the healthcare professions (e.g. physicians, 3 demographic data about the victims). The nurses, technicians, health services managers 4 name of the hospital comes up in the report and administrators, ancillary personnel, etc.). 5 and it is important that we are able to provide As these complex organizations begin to 6 our colleagues, mostly working for tabloid or rethink themselves and restructure their 7 local newspapers, with the right information. dependencies, considering corporate com- 8 These contacts facilitate the development of munication phenomena becomes fundamen- 9 good relationships with reporters. tal. The longer hospital managers take to 10 invest resources on this function, the more 1 Introduction of new technologies, resistance to change and organizational inertia 2 therapies or clinical pathways thrives and paralyses its organizational devel- 3 opment. Yet preparing professionals for one 4222 These reports announce some form of innova- such challenging corporate environment is not 5 tion at the hospital. These tend to be positive an easy task. 6 reports although one must beware if any Indeed, a prominent challenge of 7 group of stakeholders feels apprehensive or HEALTH21 is to strengthen the perception 8 may have misunderstood the change. This of health as a fundamental human right and 9 kind of media reporting is fundamental for the activity of hospitals as contributing to 20 the progress of incremental changes and gain- social equity and solidarity between com- 1 ing support amongst both stakeholders and munities, groups and genders by promoting 2 internal audiences. the participation of all its stakeholders in its 3 corporate life as argued by several authors 4 (e.g. Seedhouse et al., 1998; Saltman and Hospital originated pollution 5 Figueras, 1997). However, facing the need to 6 This includes pollution resulting from the change organizational dependency whilst 7 incinerator combustion as well as hospital being under daily scrutiny by media eager to 8 toxic waste. Environmental issues can never sell hospital issues and gain audiences makes 9 be underestimated within contemporary soci- the strategic purposes of consensus building 30222 eties highly sensitive and aware of its conse- and building implementation highly demand- 1 quences. Corporate arrogance or facts later ing in terms of professional and personal 2 found to have been concealed may have a skills. 3 dramatically negative impact on the hospital’s In this sense, executive priorities for hospi- 4 corporate reputation. In this event, as in tal corporate communication involve a num- 5 others above, we will need to implement a ber of challenges related to processes of 6 carefully designed crisis communication plan. corporate change management in an environ- 7 ment under the constant scrutiny of the 8 ‘public eye’. Now we look at this scrutiny 9 In search of a ‘balanced resource through the concept of public participation in 40 dependency’ decision making via face-to-face meetings 1 with local government officials and politi- 2 Hospitals are being challenged to balance the cians on a separate issue, namely transport 3222 widely acknowledged resource scarcity with policy.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors A changing local government Wellbeing of Communities’ and ‘Improving environment Local Democracy’. The White Paper contains some interesting statistics on turnout in local The government produced its White Paper, elections in EU countries. It quotes figures by ‘Modern Local Government: In Touch with the Rallings, Thrasher and Downe (1996) show- People’, in July 1998. This proposed the most ing that the United Kingdom has the lowest radical reorganization of local government for turnout at sub-national elections: 40 per cent the best part of a century. The White Paper compared with, for example, France 68 per stated: ‘Modern councils should be in touch cent, Germany 72 per cent, Denmark 80 with the people, provide high quality services per cent and Luxembourg 93 per cent. It is and give vision and leadership for local com- these figures that persuaded Britain’s central munities . . . The old culture of paternalism government that local government in the and inwardness needs to be swept away. The United Kingdom needed ‘modernising’. ‘New framework in which councils operate needs structures alone will not bring about renewal to be renewed’ (Cm 4014, p. 7 L4). of local democracy which is necessary if coun- The first set of changes proposed by cils are to be confident that they are reflecting government was the creation of new political the priorities and wishes of the people they structures, removing the committee system serve. That can only come about if there is which had been in place for a century higher participation in elections and close and replacing it with a choice of three models and regular contact between a council and (the status quo not being an option). These local people between elections’ (Cm 4014, were: p. 38, L3). A close reading of the White Paper makes it clear that what the government is • a directly elected executive mayor with a trying to re-establish is communication cabinet appointed by her/him from the between the local authority and its citizens. councillors; This is implicit throughout the document but, • a cabinet with a leader; surprisingly, is nowhere made explicit. • a directly elected mayor with a council The modernization was not without its crit- manager. ics and a heated debate ensued within the political classes in the United Kingdom but In the event, most councils opted for the cab- seemed to engender little interest from mem- inet and leader model with a minority opting bers of the public. Although this debate is for the directly elected mayor. important and ongoing, it is not the central Other reforms proposed included: improv- concern of this chapter. What is of concern is ing local financial accountability, a new ethical how communication systems changed within framework and new procedures for allocating local government as a result of the moderniza- capital finance and setting business rates. Also tion agenda. included were arrangements for the replace- The Local Government Bill was laid before ment of compulsory competitive tendering Parliament in 1999 and became law in 2000 (CCT) with the concept of ‘best value’ in the following the reform that had already taken provision of services to the public. place as a result of the White Paper. Perhaps the key to these changes were Elected in 1998, the author was involved in the sections dealing with ‘Promoting the the modernization process in all its aspects

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 and led a study using participative observa- explaining what was happening and why and 2 tion research criteria and the findings reflected outlining the options. The general public were 3 not only the strengths and weaknesses of that invited to one of three meetings held in dif- 4 methodology but also the importance of face- ferent parts of the borough. Advertisements 5 to-face communication – an area of growing for the meeting were also placed in the local 6 research interest in employee/organizational press. The response of the public was under- 7 stakeholder communication management in whelming. In only one of the meetings did the 8 this era of computer mediated, information attendance by the ordinary members of the 9 overload. public reach double figures. 10 The pace of change was demonstrated by Was this symptomatic of the lack of com- 1 the fact that all the new arrangements were in munication that the government had been so 2 place in the borough by May of 2000. The concerned about in drafting its White Paper? 3 borough itself is, in many ways, a typical outer The poor attendance was the subject of some 4222 London borough. In the part of the borough debate by the councillors and officers. It 5 nearest to the centre of London there are should be pointed out, however, that the 6 social problems akin to those found in inner council had been trying to improve its com- 7 London boroughs while the areas farthest munication links with the general public for 8 away from the centre of London contain afflu- some years and had introduced the facility for 9 ent suburbs. Thirty per cent of its quarter of a members of the public to speak at council and 20 million inhabitants are from minority ethnic committee meetings. A quarterly borough 1 groups, mainly Asian. At the time of the newsletter had been circulated to all house- 2 changes, there was no overall political control holds in the borough for some time. Various 3 of the council. In 1998 there was a minority views were put forward to explain the seem- 4 administration formed by the largest party. In ing lack of interest but the lack of participation 5 6 1999 the second-largest party formed the seemed to support those sceptical of the 7 administration with support from the third modernization process. 8 party. In 2000 the third party withdrew this One of the most controversial proposals of 9 support and the largest party regained minor- the modernization committee was the setting 30222 ity administration. up of local area committees. Eventually, their 1 establishment was agreed by the council 2 although the shape and size of these commit- 3 Public participation tees was debated at length. Finally, five com- 4 mittees of three wards, one of four wards and 5 The council had set up a modernization com- one of two were set up. The two latter com- 6 mittee of elected members paralleled by a mittees were of non-standard sizes because 7 task force of senior officers, so that by the they related to distinct communities. These 8 time the Local Government Act came into committees had executive powers to take 9 force, the council already had its reorganized decisions on highway schemes, parks/ 40 structure in place. The council opted for the leisure issues, monitoring local service deliv- 1 leader and cabinet model after consultation ery, transport matters, local housing manage- 2 with the public. This involved the delivery of a ment and libraries. They also had the power 3222 leaflet to all households in the borough to determine local planning applications.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Act local of the council’s full-time staff. It also had a clerk attached to the newly formed area com- Despite the original misgivings, the commit- mittee support section. tees were a success, although it has to be said the degree of success has varied from area to area. The first meeting of the committee, held Best practice in the local library, attracted over a hundred people and attendances since have rarely How did these developments affect corporate fallen below that. Initially held six times communication? The council was, and still is, a year, they now meet ten times a year. organized into departments each with its own The layout of the meeting is important, with chief officer. Some are involved with service the councillors sitting in a line facing the delivery, others have staff functions. Com- public rather than each other in the traditional munication flows tended to be within depart- confrontational way. The first half hour of the ments with co-ordination organized by the meeting is given over to a ‘public forum’ chief executive and meetings of chief officers. where members of the public can speak for While the old committee system existed up to five minutes on issues they consider senior officers of departments would com- to be important. Contributions from the floor municate with senior members of the com- are also welcomed in the second part of the mittee responsible for their department. meeting which looks at policy issues. For the Political co-ordination of information flows third part, concerned with planning issues, tended to be within party caucuses. There the committee acts in a quasi-judicial manner were also information flows from individual and the process here is much more formal. councillors to officers raising matters on Before this latter part of the proceedings a behalf of members of the public. Information break is taken and all except those concerned also flowed the other way with various with planning matters tended to leave at this departments keeping members informed of point. developments by a variety of methods includ- The success of the local area committees ing the sending of briefing documents and took everyone by surprise and stood in organizing seminars. Communication sharp contrast to the consultation prior to the between the council and the public generally modernization. It is clear that the public can was, as has been mentioned earlier, by relate to a local area in a way that they could newsletters and other circulars. The council not to a large borough. The local area was has a communication section responsible for immediate and accessible. People liked the public relations, operating with a communica- way that they could put their views across at tion strategy devised by the council. meetings and could hold their local ward The replacement of these committees by councillors to account. The committee estab- the area committees has proved problematic lished a symbiotic relationship, with local for corporate communication. Local people community groups each helping the other to do not regard things in departmental terms. develop. They do not see why, for example, when a Officers from a number of departments decision has been made to put double yellow were in attendance. Each committee had its lines around a dangerous road junction, a own ‘lead officer’ drawn from the senior ranks six-month delay is necessary so that the legal

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 services department can draw up the neces- sought. The only solution to present itself 2 sary traffic orders from a collection of areas. which did not replace the ‘rat run’ elsewhere 3 They see local problems and opportunities involved closing a road at a particular point. 4 ‘holistically’. It is also the case that the local This was duly done for an experimental 5 area councillors also began to see the situation period. However, a third group of residents 6 in the same way rather than the former situa- appeared complaining that car journeys to 7 tion of being specialists in a particular service work or school were being considerably 8 area. Hence, information flows began to extended by the closure. 9 develop between the area committees and A key communication issue arose at this 10 the cabinet and senior officers in quite a point. Remarkably, the council’s highways 1 different way from the previous service based section undertook to resurface the main 2 ones. Furthermore, while the major spending through road in the area at the same 3 areas of the council are education and social time as the experimental road closure. Clearly, 4222 services, these never feature much as a public the departmental priorities conflicted with 5 concern in area committees where the major the area priorities and the two information 6 issue is the environment. Cleansing, recycling, flows did not register a possible problem. 7 litter, parks and planning, are regular concerns The matter was resolved at a special area 8 but above all else is traffic. committee meeting held in a school sports 9 hall and attended by over 500 people. 20 Some thirty residents spoke at the meeting. 1 The use of traffic management The end result was the removal of the road 2 closure. 3 An interesting case study involved a traffic More than any of the other reforms intro- 4 matter. The area has recently had a major road duced by the council as a result of the 2000 5 development designed to link two other 6 Local Government Act, the area committee major roads and take traffic away from local 7 structure has resulted in more communication 8 roads. However, as is often the case, the road between the council and its public. This, in 9 development attracted more vehicles and turn, has resulted in problems for corporate 30222 local roads continued to be overwhelmed by communication as information flows from the 1 through traffic. One particular set of roads new structure do not fit well with the old 2 became a rat run. At one meeting some 200 departmentally driven ones. It should also be 3 members of the public turned up at an area noted that the area referred to in this chapter 4 committee meeting to demand that some- already had a strong civil society culture. What 5 thing be done. It was agreed to partially close is clear is that where local people have the 6 one of the rat run roads. Shortly after the clo- opportunity to meet their local councillors in 7 sure another group of people appeared at the their local community and hold them to 8 meeting to complain about displacement of account, sound communication will take 9 the rat running problems to their streets. place. Giving the community the opportunity 40 When both groups turned up at the following to comment on and propose policy bring 1 meeting it took considerable skills of chair- involvement and improved participation. In 2 personship to control the meeting. Eventually this area at least, the reforms have been seen 3222 the scheme was reversed and another solution to work.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Summary and space to reﬂect on issues that directly affect their lives for themselves and with Both studies indicate the criticality of face-to- others. Communication is key to sound appli- face contact with stakeholders at some point cation of policy and the operational tech- in the strategic communication process. It is niques that in the longer term are cost not enough to issue communication audits via effective. (See also Chapter 4.) post or internet. People need the opportunity

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 PART II CORPORATE COMMUNICATION 4 AT INTERNATIONAL LEVEL 5 6 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 8 2 3 4 Communication audits: building world class 5 6 communication systems 7 8 Dennis Tourish and Owen Hargie 9 10 1 2 3 4222 5 Effective internal communication by both management and employees alike is a vital 6 prerequisite for the functioning of any organization. In this chapter the authors suggest 7 that the key to building an effective internal communication system lies in managers 8 having an accurate picture of how well they and everyone else in an organization is 9 actually communicating. To achieve this goal the authors believe that all companies must 20 have a focused communication strategy designed to build a world-class system for 1 sustaining internal communication and that this system must be rigorously and honestly 2 evaluated utilizing communication audit techniques. 3 4 5 6 7 8 Introduction very limited understanding of the communi- 9 cation dynamics within their own organiza- 30222 Effective internal communication is a vital tion. In our own research in this ﬁeld, we have 1 prerequisite for the functioning of all organ- frequently found that the people most sur- 2 izations. Yet it is a commonplace that comprised by audits which point to problems are 3 munication is poor in most. Employees the senior management team (Hargie and 4 complain that they neither know nor under- Tourish, 2000). The result can be a climate of 5 stand corporate priorities, while frustrated mutual suspicion rather than trust, with ener- 6 senior managers insist that they have invested gies that should be focused on beating the 7 a great deal of time in explaining them. There competition squandered in internal struggles. 8 is additional evidence that information trans- In this chapter, we suggest that the key to 9 mission from the bottom to the top is also building a world-class communication system 40 defective, with employees and even managers lies in managers having an accurate picture of 1 fearing to articulate their true opinions to how well they and everyone else are actually 2 those further up the hierarchy (Rosenfeld et communicating. In a nutshell, we advance a 3222 al., 1995). Thus, senior managers often have a twofold argument:

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1 All organizations need a focused com- • widely touted as a panacea for organ- munication strategy, designed to build a izational ills, but allocated minimal world-class system for sustaining internal fiscal or functional resources; communication. • all pervasive, but often unplanned; it is 2 The first step in implementing the above often the case that communication is is that current practice must be rigorously what happens to companies when they and honestly evaluated, utilizing com- are busy doing other things; munication audit techniques. • hailed as being of central importance in terms of what managers actually do, We then discuss in-depth how audits can be but rarely investigated with the same implemented, and the data collection options rigour as is reserved for such other available. While the main focus of this chapter functions as finance; is upon internal communication, audits are • still regarded as something that man- also of importance for external communica- agers do to their subordinates; they tion, and so we raise issues of relevance to the drop information like depth charges on latter area as well. to those employees submerged in the organizational ocean but make it very clear that they do not expect to receive The nature of a communication any feedback torpedoes in return. strategy (Hargie and Tourish, 2004) It is a truism that organizations seeking a com- The result is a disabling gap between theory petitive advantage must design their systems and practice. This is clearly dysfunctional, and to at least match, and then exceed, world best can impact adversely upon the workforce, practice. Organizational communication is no resulting in reduced employee motivation, different. It has been suggested (Clampitt and lower rates of production, greater industrial Berk, 2000) that a world-class communication unrest, increased absenteeism, and higher system has five key attributes: staff turnover (Hargie and Tourish, 2000). • The leadership team has a strategic com- The schema proposed by Clampitt and Berk mitment to effective communication. (2000) suggests that senior management is • Employees at all levels have the appropri- not solely responsible for the effectiveness of ate communication skills. the entire communication system. All employ- • There is a proper infrastructure of chan- ees have responsibilities in this area. For nels to meet organizational objectives. example, while our own work with communi- • There are proper communication policies cation audits (e.g. Tourish and Hargie, 1998) and procedures to meet organizational has often found people clamouring for more objectives. information, it has rarely found them insisting • Information is managed in a way to meet that they have any responsibility for transmit- organizational objectives. ting it. A communication strategy built around the five assumptions outlined above will fun- Few organizations have systems in place that damentally challenge such mindsets. are consistent with these attributes. Often, the Communication strategies are all about sad reality is that communication is: strengthening relationships, sharing owner-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 ship of key issues and relating communication • Implement an action plan tailored to 2 priorities to key business issues. If an organ- rectify identified deficits. 3 ization does not develop and implement a • Conduct a follow-up audit to evaluate 4 coherent strategy to manage its communica- the effects of the action plan. 5 tion, ad hoc and often dysfunctional methods 6 will develop. A strategy provides both a path Accurate information about the state of inter- 7 along which communication can be guided, nal communication can best be obtained 8 and a structural set of processes and proced- through the implementation of a communica- 9 ures to ensure success in this field. We have tion audit. The main advantage of an audit is 10 therefore suggested that a communication that it provides ‘an objective picture of what 1 strategy can be defined as ‘A process which is happening compared with what senior 2 enables managers to evaluate the communi- executives think (or have been told) is hap- 3 cation consequences of the decision making pening’ (Hurst, 1991: 24). The findings pro- 4222 process, and which integrates this into the vide reliable feedback and this in turn allows 5 normal business planning cycle and psyche of managers to make decisions about where 6 the organisation’ (Tourish and Hargie, 1996, changes to existing practice are required. A 7 p. 12). Flowing from this, what concretely communication audit sheds light on the often 8 must managers do to develop a communica- hazy reality of an organization’s performance, 9 tion strategy and implement an audit process and exposes problems and secrets to critical 20 that will evaluate its effects? A number of scrutiny. It enables managers to chart a clear 1 excellent reviews are now available (e.g. course for improved performance. 2 Clampitt et al., 2000). Drawing upon this The term ‘audit’ is ubiquitous. Financial 3 research, we suggest the following process: audits are well established, and clinical audits, 4 medical audits, and organization audits are 5 1 secure senior management commitment; also now widely employed. Three characteris- 6 2 identify current practice (i.e. audit); tics are, in fact, common to all audits (Hargie 7 3 set standards to measure success; and Tourish, 2000): 8 4 develop an action plan to achieve the 9 standards; 1 The accumulation of information. This is the 30222 5 measure the results (i.e. audit again). diagnostic phase of the audit. In com- 1 munication terms, managers need inform- We now discuss these steps in the context of 2 ation about the quality and quantity of outlining a robust communication audit 3 communication flowing between different process. 4 sectors of the organization. 5 2 The creation of management systems. This is 6 A communication audit process the prescriptive phase of auditing. Once 7 information has been gathered, systems 8 In broad terms, the key steps in measuring must then be put in place to further 9 communication can be summarized as follows: develop best practice, and to remedy 40 identified deficits. 1 • Audit current levels of performance. 3 Accountability. This is the functional aspect 2 • Disseminate the results of the audit widely of the audit process. Specific individuals 3222 across all levels. should be made accountable for different

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors aspects of internal communication, so that The audit sequence when problems are highlighted someone is specifically tasked with ensuring these Relating this to the discussion of communica- are swiftly dealt with. If a problem is tion strategy with which we began this chap- everyone’s responsibility it is usually no ter, and based upon the findings of previous one’s responsibility. audit investigations across a wide variety of sectors (Hargie and Tourish, 2000), we would This chapter argues that assessments of com- suggest that the following sequence be munication effectiveness should match the adhered to. Auditors who depart from it seriousness of intent evident when such func- should have compelling reasons for doing so. tions as finance are audited. As such, a com- Thus, the process of audit implementation munication audit has been defined as: ‘a should encompass the following key stages. comprehensive and thorough study of communication philosophy, concepts, structure, flow and practice within an organization’ Engage senior management (Emmanuel, 1985: 50). Various techniques commitment exist to achieve this outcome (Goldhaber and Rogers, 1979; Downs and Adrian, 1997; A variety of studies has suggested that unless Hargie and Tourish, 2000; Dickson et al., senior managers, and especially the CEO, are 2003), and these will be summarized in the actively involved in any change process, next section. Typically, data emerges on and passionately committed to its success, it information underload and overload, bottle- will fail (e.g. Spurgeon and Barwell, 1991; necks within the organization, examples of Pettigrew et al., 1992). The buck usually stops positive communication flow, and pressing with the CEO as captain of the ship. But the communication concerns at all levels. For captain also decides upon what voyages will example: be undertaken and in what ways. Without the CEO on board the audit ship will not sail. • Do management and staff perceive the New tools designed to assist organizational organizational world differently? development will usually appear threatening • What must be done to achieve and sustain to some. They require an intense level of significant improvements in communica- senior management involvement, if their use tion? is to yield positive dividends. At the outset of • Where are the greatest threats and the the audit process a problem focused work- greatest opportunities? shop between senior management and the • When, how, and in what way, will future auditors should therefore be held. Such an progress be monitored? event serves to achieve the following.

A key goal in all of this is to accurately gauge (1) Improve the management team’s under- the views of employees. Thus, as noted by standing of what can be achieved by audits, of Furnham and Gunter (1993: 204), ‘A com- how a world-class communication system can munication audit is a positive and motivating be built, and what it might look like in this or- exercise, being in itself an internal consulta- ganization. It will therefore raise the following tion process.’ questions:

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • What are the key business problems that (3) Identify the top half dozen issues on which 2 arise through poor communication? It people should be receiving and sending informa- 3 should be noted that this is a different tion. An audit cannot examine every conceiv- 4 proposition to the identification of com- able issue, in-depth. Our own research has 5 munication problems, important as this is. generally found that information flow 6 Rather, it is to suggest a focus on the on a few key issues tends to be typical of 7 deeper business problems that are caused the overall communication climate (Tourish 8 by the organization’s communication dif- and Hargie, 1998). Restricting the number of 9 ficulties. This ensures that the underlying issues to be explored in this way is sufficient 10 thrust of a communication review (to to provide valid data, while ensuring that 1 improve business performance) remains in the audit remains practicable. For example, 2 focus. if the audit is concerned with external com- 3 • Flowing from this, what are the organiza- munication, what are the most important 4222 tion’s major communication problems? issues which the company wants its customers 5 The audit can then seek to determine to be aware of? Conversely, what does it 6 whether such problems exist, chart their want to hear from its customers about? These 7 exact nature, how deep they are, what has data can then be incorporated into the materials being used during the audit exercise. If 8 caused them, and what can be done. 9 questionnaires are being employed, a section • What changes in behaviour are required 20 should explore information flow on the key to eliminate these problems? How specific 1 issues identified. can we be about these changes? How will 2 This also offers a good opportunity to we know when they have occurred? At 3 delineate the extent of the audit exercise, and the outset, this sets an agenda for action, 4 therefore clarify managers’ conception of the and primes managers to anticipate that 5 communication process. It is essential, at this 6 changes in their own behaviour as well as stage, to establish what audits both can and 7 that of others is likely to follow from the cannot do. Managers must have realistic 8 audit process. expectations about what can be achieved. 9 (2) Clarify in-depth the value of audits, their role Like parents’ expectations of a child, it is not 30222 in this particular organization and the commit- good when too much (or too little) is envi- 1 ment required from management if maximum sioned. The audit will be less likely to achieve 2 advantage is to be obtained. For example, the its full potential, as a tool for facilitating 3 following issues should be addressed: organizational development, if expectations 4 are unrealistic. For example, it is difficult to 5 • What time scale best ties in with the busi- use data obtained from focus groups to set 6 ness planning cycle? statistical benchmarks. If the focus group is the 7 • Will other organizational development only tool which the organization can use, and 8 issues need to be rescheduled? there are many circumstances under which 9 • How can evaluating communication this is the case, it is unrealistic to think that 40 channels with customers support the future audits will be able to measure precisely 1 marketing strategy? the extent of any progress that has been 2 • What plans can be made to circulate the made. Novice auditors may be inclined to 3222 audit results as widely as possible? promise more than they can deliver, thereby

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors undermining the credibility of the whole encourage overt commitments by the key process. publics concerned, internally and/or externally. (4) Discuss the communication standards the management team believes they should adopt (5) The identification of a senior person or per- and live up to. For example, in the United sons prepared to act as link between the organ- Kingdom, the National Health Service Man- ization and the external audit team. If the audit agement Executive published standards for is being conducted in-house, a link between communication in 1995, and circulated them those handling the project and top manage- throughout the main management tiers of the ment is still vital. This is not to suggest that organization (NHS Executive, 1995). This was auditors should surrender their indepen- a summary of best general practice, recom- dence. However, ongoing contact with key mending that commitments be made to: people is vital to keep doors open; prevent sabotage or obstruction; ensure that the audit • board-level discussions; time scale remains on track; and provide • regular audits; essential information on the organization’s • upward appraisal; structure, history, internal politics, business • training for effective communication; challenges, main priorities and climate. • the consideration of communication during the business planning cycle; and • the identification and reward of good Prepare the organization for the audit practice. Usually, a simple letter is sufficient to inform Having established standards, answers must staff of the nature of the audit process, and then be formulated to a number of key the time scale which is envisaged. We would questions: recommend that it be issued by the chief • what do they mean in practice? executive, thus putting the authority of this • how will every organizational unit be office behind the audit. This helps to ensure transformed if they are implemented? that managers facilitate access to audit par- • what has stopped such implementation in ticipants, and generally engage with what the past? is going on. It also binds the top manage- • how much can be agreed and how much ment team into the audit exercise, by publicly will remain in dispute for the foreseeable identifying them with it. This makes it more future? likely that the results of the audit will be taken • how quickly can change begin? seriously and used to effect improvements • what training needs are essential to imple- in performance. In the case of external audits, ment this change? a sample of customers or supply businesses can be addressed in a similar manner. Alterna- The audit can then reveal the extent to which tively, internal or external newsletters, videos the standards are being implemented; stimu- or team briefing mechanisms can be em- late further discussion on the gap between ployed. current practice and the characteristics of Recurring worries which tend to arise at this a world class communication system; and point include confidentiality, how widely

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 available the results will be, and the time • Care should be taken, in writing the report, 2 commitment required of audit respondents to ensure that it does not inadvertently 3 (Tourish and Tourish, 1996). The most difficult enable readers to identify particular respond- 4 of these issues is confidentiality. Respondents ents. For example, if only one person 5 are often wary of honestly expressing their works in the payroll department the 6 views, in case what they say will be used report should not cite comments, good or 7 against them at a later stage. It may be neces- bad, from ‘a payroll respondent’. 8 sary to address these issues during initial com- • Audit instruments should be administered 9 munication with audit participants. The well away from the gaze of managers. 10 following general rules help: Again, during one of our audits, we had 1 just spent some time explaining the con- 2 • Participants should be assured, orally and in fidential nature of the exercise to a group 3 writing, that their responses will be treated of questionnaire respondents, when a 4222 confidentially. Research shows that the member of the senior management team 5 more often a message is repeated the dropped by simply to see how many 6 more likely people are to accept that it is people had turned up. Unfortunately, the 7 true (Cialdini, 2001). Accordingly, these effect was to discredit our assurances 8 assurances should be reiterated on a of confidentiality with the people concerned. 9 number of occasions – the more publicly, 20 the better. The steps proposed to ensure 1 Normally, these procedures are sufficient to confidentiality should be explained in 2 ensure that this problem is eased. However, it detail. 3 remains one of the strongest arguments in • Wherever possible, participants should be 4 favour of using external rather than internal selected randomly. This reinforces the mes- 5 auditors. If a top manager turns up to admin- sage that the aim of the exercise is not to 6 ister questionnaires or conduct interviews, or 7 single people out with a view to imposing if the person concerned is viewed as being 8 sanctions. There are hazards to this. When close to managers, confidentiality assurances 9 administering questionnaires to a group have low credibility. 30222 during one of our audits, one of the 1 people present approached us to remark 2 that it was the third time in six months he Data gathering 3 had been ‘randomly selected’ to com- 4 plete questionnaires, dealing with a vari- This normally proceeds in two phases. A small 5 ety of organizational development issues. number of preliminary first round inter- 6 Intense persuasion was required to con- views familiarizes the audit team with staff 7 vince him that we were not part of a or customer views, as well as management 8 management plot against him! concerns. Typically, respondents will be ran- 9 • Only the audit team should have access to domly selected. Feedback obtained by this 40 questionnaires, tape recordings or anything approach helps in the design of final question- 1 else which might identify individual respond- naires, if this is the main method to be used. A 2 ents. All such materials should be des- number of issues have been suggested which 3222 troyed at the conclusion of the audit. should be explored in preliminary interviews

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors (Tourish and Tourish, 1996). The bulk of these • What targets can be set to eliminate com- are applicable to both internal and external munication failure itself? audits: • What behaviours are the senior management team now willing to change, in • how decisions are made; order to demonstrate a symbolic commit- • communication channels; ment to improved communication? • communication relationships; • communication obstacles; For example, targets can be set for: • organizational structure; • responsiveness (e.g. the quality of inform- • increased and sustained knowledge; ation flow during a crisis). • high levels of goodwill and credibility; • a regular flow of communication (e.g. Finally, the main audit exercise is embarked how much information will flow, on what upon. A pilot test is vital. This makes it possi- topics, to what sources, utilizing what ble to detect shortcomings in the design and channels); implementation of questionnaires (Emory and • accurate expectations about future mile- Cooper, 1991), or other approaches being stones in organizational development (i.e. employed. However, as Remenyi et al. (1998: fewer toxic shocks); and 174) pointed out, ‘in business and manage- • satisfaction with levels of participation. ment research there is usually time and considerable financial pressure to get the project Ongoing audit research tracks the progress of started’. Pilots are therefore often selected all these factors. opportunistically, on grounds of convenience, It should be noted that this period presents availability, proximity or cost. We do not view both opportunities and dangers. Audits arouse this as a major problem. A pilot is a test case, increased interest and expectations. As a gen- undertaken to double check the viability of eral rule, people recognize that everyone likes the approach chosen. It should not, even to sing loudly about their successes, while under ideal circumstances, become so elabo- remaining mute about their mistakes. Thus, if rate that it develops into a main study in its an audit is followed by silence it is likely to be own right. However, once the pilot is com- widely assumed that managers are either busy plete, the main study can proceed. burying dreadful secrets in the basement, or meeting in a cabal to plot revenge on certain Analysis and action phase thankless employees who have criticized them. A key principle when confronted with A report is now prepared, which comprehen- bad news, if this is what emerges, is that it sively describes and evaluates communication should be shared openly and quickly, thereby practices. Among the key questions that arise, enabling those involved to at least gain credit we think that the following are particularly for their honesty (Payne, 1996). important: The results of the audit are, in the first instance, presented to the top management • What targets can be set to eliminate the team, orally and in writing. The results then problems that arise from communication need to be circulated widely, by whatever failure? means are most appropriate. Action plans

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 should also be publicized. In this way, the national Communication Association Audit 2 process of audit, as well as whatever changes Survey (Goldhaber and Rogers, 1979; Hargie 3 to which it gives rise, helps achieve significant and Tourish, 2000). The questionnaire 4 strides forward in open and clear communica- method allows the auditor to control the focus 5 tion. of the audit, enables a large number of 6 respondents to be surveyed, and produces 7 benchmark rating scores for various aspects 8 Methods used in the auditing (e.g. ‘communication received from senior 9 process managers’) against which future performance 10 can be measured. The main drawback is that 1 There are a wide variety of alternative it is limited in the extent to which it can gauge 2 approaches, and the ones selected should be the deeper-level thoughts and feelings of 3 the ‘best fit’ for the organization concerned. respondents. 4222 The methods used should be tailored for 5 the corporate body under analysis, as ‘off-the- 6 peg’ systems, like cheap suits, are rarely Interviews 7 attractive and inevitably fail to fit along some 8 of the required dimensions. Furnham and Another popular audit approach is the struc- 9 Gunter (1993) used the term ‘organometrics’ tured interview. Indeed, in his text in this 20 to refer to the methods used to measure the field Downs (1988) concluded that if he had 1 various dimensions of organizational function- to select just one audit method he would 2 ing. We will now briefly review the alternative choose the interview. This is because it allows 3 organometric tools relevant to communica- for communication experiences to be ex- 4 tion audits. plored in detail, and as such can often pro- 5 duce interesting insights that surveys may 6 miss. Researchers have increasingly recog- 7 Survey questionnaires nized that people form different impressions 8 of the same events, and that chronicling the 9 This is the most widely used approach to stories that typify organizational life is a key 30222 auditing. Indeed, Clampitt (2000) pointed out means of understanding what sense people 1 that organizational surveys are now as com- are making of their environment (Gabriel, 2 monplace as weather forecasts. This was con- 2000). Interviews and focus groups (discussed 3 firmed by Goldhaber (2002: 451), who noted below) are an invaluable means of tapping 4 ‘The survey, however, has become the domi- into the stories, folklore, myths and fantasies 5 nant method chosen by academics and that people develop as part of the organiza- 6 consultants – mostly due to its ease of devel- tional sense-making in which we all engage. 7 opment, administration, and interpretation On the down side, it is time-consuming and 8 – both for clients and for research publica- expensive. Interviews, which can last up to 9 tion.’ There are several validated audit ques- two hours for managers and one hour for 40 tionnaires that can be tailored for specific non-managers (Millar and Gallagher, 2000), 1 organizations. The two main ones are the have to be recorded and transcribed for 2 Communication Satisfaction Questionnaire analysis. As such, it does not readily allow for 3222 (Downs and Hazen, 1977) and the Inter- large numbers to be involved in the audit.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Furthermore, unlike surveys, interviews can- 2 textual analysis (or hermeneutics), which not be anonymous and so may be vulnerable involves the thematic analysis of written to social acceptability responses. documents of all kinds (brochures, minutes of meetings, mission statements, etc.) as well as transcripts of interviews or Focus groups group meetings.

These are ubiquitous, and have permeated In interpretive audits, three main types of data all walks of professional life, from politics to are collected: naturalistic observations, tran- marketing. They can be used to develop scriptions of relevant texts, and recorded insights at a macro level (such as the impact responses to researcher questions. These are, of strategic decision making) or on a micro in turn, analysed using thematic analysis, level (such as detailed responses to particu- metaphor analysis or narrative analysis, in lar communication messages) (Daymon and order to achieve a symbolic interpretation of Holloway, 2002). In their comparison of audit organizational communication (Meyer, 2002). methodologies, Dickson et al. (2003) argued The report produced from an interpretive that the open-ended and interactive nature of investigation is also different from a tradi- focus groups produces insights from respond- tional audit report, being more in the form of ents that are difficult to obtain through other a narrative ‘tale’ of the researcher’s experi- methods. Participants spark one another into ences in the organization (Van Mannen, 1988; action by sharing and developing ideas. Two Gabriel, 2000). main disadvantages are that more introverted staff are reluctant to participate, and some staff may be unwilling to express honest views What audits tend to find in the presence of colleagues. There is no substitute for completing an indi- These are the three most widely employed vidual audit. Every organization is different organometric audit tools, although there is a and will have specific needs. These can only be range of other approaches, such as critical identified through a specific, tailored assess- incident analysis, ECCO, data collection log- ment. It is possible to predict certain recurring sheet methods, constitutive ethnography, themes, and a number have been identified in social network analysis, and undercover audit- the literature (e.g. Hargie and Tourish, 2003). ing (for a full analysis of these, see Hargie and In general, we have found the following. Tourish, 2000; Dickson et al., 2003). For those who conceptualize organizational assessment as a form of collaborative or Immediate line managers are crucial for employee-centred enterprise the two main effectiveness methodologies employed (Jones, 2002; Meyer, 2002) are: In essence, people want supervisors who:

1 ethnomethodology, which seeks to under- • take a personal interest in their lives; stand how employees construct their • seem to care for them as individuals; interpretations of the organizational • listen to their concerns and respond to world through interaction; these quickly and appropriately;

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • give regular feedback on performance in a dissent leads to resentment and a desire for 2 sensitive manner; revenge. Employees are then more likely to 3 • hold efficient regular meetings at which try to sabotage management initiatives. Put 4 information is freely exchanged; simply, those organizations that have the most 5 • explain what is happening within the effective communication strategies are open 6 company. to employee feedback, and spend both time 7 and money in obtaining it. 8 In terms of shaping a strategy to deal with 9 such problems, it is therefore important for 10 organizations to disseminate information Information should be widely shared 1 swiftly to first line supervisors. They should Staff want to be ‘in the know’ rather than 2 also provide them with comprehensive com- being ill informed. In their study of over 3 munication training so that they can optimize 2,000 employees across 21 organizations in 7 4222 the impact they have upon the workforce. different countries, Shockley-Zalabak and Ellis 5 Unfortunately, we have often found that (2000: 384) found that: ‘information recep- 6 many organizations are reluctant to do this, tion has a stronger relationship to effective- 7 apparently assuming that their managers ness and job satisfaction than other measured 8 should be innately capable of sustaining communication activities. This supports the 9 a world-class communication environment. importance of planning and monitoring the 20 Such assumptions are baseless. frequency of messages about organizational 1 performance, practices, policies, and a variety 2 of job-related issues’. In other words, audits 3 Change and employees are essential tools for measuring and monitor- 4 ing this pivotal aspect of information flow. 5 Change is more likely to occur, and will be 6 based on a clearer perception of organiza- 7 tional needs, if the views of employees are Maximum use should be made of 8 regularly and systematically obtained. face-to-face channels 9 Employees appreciate a climate in which 30222 bottom-up communication is encouraged. It is perhaps a reassuring finding that in our 1 This means that systems must be put in place ever-increasing technological world (and 2 to allow vertical transmission of information indeed even because of it), humans still prefer 3 and opinions up the hierarchy. Such data must to interact with one another in person. 4 also be acted upon and feedback given on its Employees especially want to meet and talk 5 worth. Thus, Kassing (2000) showed that with senior managers. Interestingly, our find- 6 employees in workplaces where feedback is ings show that their expectations tend to be 7 encouraged have a high level of identification very realistic (Hargie et al., 2002). They know 8 with the organization and openly articulate that senior managers are busy people and do 9 dissenting views, knowing that these will be not expect huge amounts of interpersonal 40 welcomed. By contrast, where feedback is dis- contact with them. However, they do want to 1 couraged employees have a low level of iden- see them from time to time. In all walks of life, 2 tification with the organization and are less individuals value being with powerful or 3222 likely to openly express their views. Repressed famous people (Hargie and Dickson, 2004).

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors The work setting is no different. Thus, man- how well we communicate. As with car agers who hide permanently in their bunkers, smashes, communication bumps and colli- and run their operation by firing out salvos of sions are invariably held to be the fault of email directives, are missing out on a potent someone else. We have a vast armoury of self- influencing opportunity. Management by talk- serving biases, which distorts our perception ing with staff is eminently preferable. of the wider social world (Dawes, 2002), and of how well we perform in our roles as managers (Tsang, 2002). Without a system for Employees value communication objective evaluation, people are unlikely to training realize that such self-satisfied perceptions are most likely to be distorted illusions. In addi- This finding has two sides. First, employees tion, unless a proper strategic framework is report that they personally wish to receive sys- adopted to evaluate and monitor what hap- tematic training in the communication skills pens, during difficult times organizations that are central to their work. Second, they move towards a feeling of helplessness. want their managers to be trained in the We have encountered some managers appropriate skills to enable them to manage who shrug aside the view that prevailing sys- effectively. Communication skills training has tems could be improved. Their view is been shown to be effective across a range of that communication is like the weather – we professional contexts (Hargie, 1997), yet would all like it to be better, but can’t really do many organizations fail to realize the full anything to bring about such a state of affairs. potential of their staff owing to a lack of It is therefore an unfortunate paradox that, investment in such training. while most people admit that communication is vital to the building of successful organizations, most organizations allocate precious Conclusion few resources to improving it. Some managers convey the impression that they are willing to Organizations are fundamentally systems for do anything humanly possible to improve facilitating human interaction. How well peo- communication – except devote time, energy ple exchange information is often the most and resources to it. Few other functions are critical factor in determining whether a busi- expected to manage themselves on a similar ness lives or dies. It is impossible to imagine a basis. highly innovative, customer centred organiza- This chapter has proposed that it is possible tion coming into existence, or sustaining its to build a world-class communication system pre-eminent position, without its managers, and a front-rank communication strategy. and employees, paying the closest attention to As always, evaluation is critical to success. how well they all communicate with each What gets measured gets done. Organizations other. Yet, as we noted at the beginning of this that integrate audits into their regular com- chapter, it is often easier to find instances of munication planning process, who take the poor communication than it is to highlight results seriously, and who base their com- examples of communication excellence. munication strategies on hard data rather There are many reasons for this. For exam- than vague hunches are much more likely to ple, it is clear that most of us tend to overrate succeed than their rivals.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 REFERENCES 2 3 Cialdini, R. (2001) Inﬂuence: Science and Practice, 4th Communication Audit, Dubuque, IA: Kendall/ 4 edn, Boston: Allyn and Bacon. Hunt. 5 Clampitt, P. (2000) ‘The questionnaire approach’, in Hargie, O. (1997) ‘Training in communication skills: 6 O. Hargie and D. Tourish (eds), Handbook of research, theory and practice’, in O. Hargie Communication Audits For Organisations, London: (ed.), The Handbook of Communication Skills, 7 Routledge. London: Routledge. 8 Clampitt, P. and Berk, L. (2000) ‘A communication Hargie, O. and Dickson, D. (2004) Skilled Interpersonal 9 audit of a paper mill’, in O. Hargie and D. Tourish Communication: Research, Theory and Practice, 10 (eds), Handbook of Communication Audits For London: Routledge. 1 Organisations, London: Routledge. Hargie, O. and Tourish, D. (2004) ‘How are we doing? Measuring and monitoring organizational com- 2 Clampitt, P., DeKoch, R. and Cashman, T. (2000) ‘A strategy for communicating about uncer- munication’, in D. Tourish and O. Hargie (eds), 3 tainty’, Academy of Management Executive, 14, Key Issues in Organisational Communication, 4222 41–57. London: Routledge. 5 Dawes, R. (2002) Everyday Irrationality, Boulder, CO: Hargie, O. and Tourish, D. (eds) (2000) Handbook of 6 Westview Press. Communication Audits For Organisations, London: Routledge. 7 Daymon, C., and Holloway, I. (2002) Qualitative Research Methods in Public Relations and Marketing Hargie, O., Tourish, D. and Wilson, N. (2002) 8 Communications, London: Routledge. ‘Communication audits and the effects of 9 Dickson, D., Rainey, S. and Hargie O. (2003) increased information: a follow-up study’, Journal 20 ‘Communicating sensitive business issues: Part I’, of Business Communication, 39, 414–36. Hurst, B. (1991) The Handbook of Communication Corporate Communications: An International 1 Skills, London: Kogan Page. Journal, 8, 35–43. 2 Jones, D. (2002) ‘The interpretive auditor: reframing Downs, C. (1988) Communication Audits, Glenview, IL: 3 the communication audit’, Management Com- Scott, Foresman. munication Quarterly, 15, 466–71. 4 Downs, C. and Adrian, A. (1997) Communication Jones, E. (1990) Interpersonal Perception, New York: 5 Audits, Lawrence, KS: Communication Manage- Freeman. ment. 6 Kassing, J. (2000) ‘Exploring the relationship between Downs, C. and Hazen, M. (1977) ‘A factor analytic 7 workplace freedom of speech, organisational 8 study of communication satisfaction’, Journal of identification, and employee dissent’, Com- Business Communication, 14, 63–73. munication Research Reports, 17, 387–96. 9 Emmanuel, M. (1985) ‘Auditing communication 30222 Meyer, J. (2002) ‘Organisational communication practices’, in C. Reuss and DiSilvas (eds), Inside assessment: fuzzy methods and the accessi- 1 Organisational Communication, 2nd edn, New bility of symbols’, Management Communication 2 York: Longman. Quarterly, 15, 472–9. 3 Emory, C., and Cooper, D. (1991) Business Research Millar, R. and Gallagher, M. (2000) ‘The interview 4 Methods, Burr Ridge, IL: Irwin. approach’, in O. Hargie and D. Tourish (eds), Furnham, A. and Gunter, B. (1993) Corporate Assess- 5 Handbook of Communication Audits for ment: Auditing a Company’s Personality, London: Organisations, London: Routledge. 6 Routledge. NHS Executive (1995) Setting Standards for NHS 7 Gabriel, Y. (2000) Storytelling in Organisations: Facts, Communications: Consultation Document, London: 8 Fictions and Fantasies, Oxford: Oxford University NHS Executive. 9 Press. Payne, J. (1996) ‘Developing and implementing strat- Goldhaber, G. (2002) ‘Communication audits in the 40 egies for communicating bad news’, Journal of age of the internet’, Management Communication Communication Management, 1, 80–8. 1 Quarterly, 15, 451–7. Pettigrew, A., Ferlie, E. and McKee, L. (1992) ‘Shap- 2 Goldhaber, G. and Rogers, D. (1979) Auditing Organ- ing strategic change: the case of the NHS’, Public 3222 isational Communication Systems: The ICA Money and Management, 12, 27–32.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Remenyi, D., Williams, B., Money, A. and Swartz, E. Tourish, D. and Hargie, O. (1998) ‘Communication (1998) Doing Research in Business and Man- between managers and staff in the NHS: trends agement: An Introduction to Process and Method, and prospects’, British Journal of Management, 9, London: Sage. 53–71. Rosenfeld, P., Giacalone, R. and Riordan, C. (1995) Tourish, D. and Tourish, B. (1996) ‘Assessing staff- Impression Management in Organisations, London: management relationships in local authority Routledge. leisure facilities: the communication audit Shockley-Zalabak, P. and Ellis, K. (2000) ‘Perceived approach’, Managing Leisure: An International organisational effectiveness, job satisfaction, Journal, 1(2), 91–104. culture, and communication: challenging the Tsang, E. (2002) ‘Self-serving attributions in corporate traditional view’, Communication Research annual reports: a replicated study’, Journal of Reports, 17, 375–86. Management Studies, 39, 51–65. Spurgeon, P. and Barwell, F. (1991) Implementing Van Mannen, J. (1988) Tales of the Field: On Writing Change in the NHS, London: Chapman and Hall. Ethnography, Chicago: University of Chicago Tourish, D. and Hargie, C. (1996) ‘Internal communi- Press. cation: key steps in evaluating and improving performance’, Corporate Communications: An International Journal, 1(3), 11–16.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 9 2 3 4 The Olympic Games: a framework for 5 6 international public relations 7 8 Yvonne Harahousou, Chris Kabitsis, Anna Haviara and 9 Nicholas D. Theodorakis 10 1 2 3 4222 5 The inclusion of properly organized public relations in an organizing committee for the 6 Olympic Games has become a necessity; the Games have evolved, and the complexity of 7 promoting a favourable image for any host city demands strategic planning and organiz- 8 ing. For future organizers to be successful in this task, the knowledge and experience 9 gained from already implemented publicity programmes is vital. In this chapter, PR activ- 20 ities in OCOG’s public relations have been recorded and a model has been developed as 1 a reference point for the next Olympic Games PR programme and beyond. 2 3 4 5 6 Introduction at presenting the PR evolution in a period of 7 more than twenty years. This permits the 8 The task of a city hosting the Olympic Games reader to have a comprehensive view of the 9 is a rather demanding and complicated one, public information needs as expressed by 30222 spreading in multiple organizational areas and the public and met by organizers. 1 leaving an apparent impact on the overall The PR programmes were presented as 2 image of a whole country for many years fol- evolved through the Olympiads since Los 3 lowing the completion of the Games. At the Angeles in 1980 until Sydney 2000, and 4 same time, the preparation period that leads commendation on the major initiatives was 5 to the Olympic Games is also a signiﬁcant provided. Finally, the best programmes imple- 6 opportunity for promotion and international mented were outlined as a model suggestion 7 exposure. for future Organizing Committees (OC) for the 8 As image and identity promotion are two Olympic Games. The main hypothesis that this 9 sensitive areas (Marconi, 1996), public rela- research explores, is whether there has been 40 tions of the organizing body of the Olympic developed an effective generic model for the 1 Games should be approached carefully and be public relations in organizing committees 2 developed based on already tested tech- which, with certain minor alterations, based 3222 niques and strategies. The present study aims on the speciﬁc culture for each country and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors expected evolution, may be adjusted so as to the Games. The philosophy of the OCOG was contribute to the success of the Olympic that the Games would spontaneously sell Games. itself, as the world’s most anticipated sporting Public relations involves research and event. The structure and responsibilities allo- analysis, policy formation, programming, cated in LAOOC were clear and based on a communication and feedback from a variety thorough organizational planning. The proof publics. The perplexed nature of the field jects that contributed the most to the overall and the sensitivity that characterizes transac- success of the Organizing Committee’s PR tions with a public make a PR strategy plan programme were the public information and and implementation an absolute necessity for the speakers bureau. an organization, especially a large-scale one, Members of the speakers bureau played such as an organizing committee for the a vital role in shaping the positive feelings of Olympic Games. Despite the extensive organ- the people of Los Angeles, which culminated izational PR literature and the post-Games in their enthusiastic support, and resulting reports presenting the PR approach under- success of the Games. The Olympic spirit taken by organizing committees for the team, which made systematic use of former Olympic Games, there is a lack of comparative Olympians, an idea originally launched from and evaluative research among these. the Munich organizers back in 1972, was also a success. The individuals making up the group not only had considerable media Public relations in the organization appeal, but they were strongly motivated, committees 1980–2000 articulate and enthusiastic, able to inspire many youngsters, volunteers and entire com- Los Angeles 1984 munities by giving their time and energy to promoting the Olympic Games. The PR department of the Los Angeles Olym- What is remarkable for the Los Angeles PR pic Games Organizing Committee (LAOOC), implementation is the fact that importance was formed in late 1979 and included six was given to developing a two-way communi- different sub-programmes that played a cation programme, for the first time in key role in shaping popular public opinion Olympic Games PR history. The structure of for the Games (LAOOC, 1984). These sub- the PR department contributed to that. The programmes were: community relations divi- public information division filled a need for sion, public information division, audiovisual more direct contact with southern California division, speakers bureau, Olympic spirit team residents by creating a telephone hotline and publications division. Several other oper- that the public could call to voice concerns, ating departments within the OCOG, many ask questions or offer support. The speakers of which had their own public relations or bureau and the Olympic spirit team offered publicity staff, supplemented the work of even more personal contact by dispersing staff these PR department divisions. members and Olympians to share information The PR programme of the LAOOC was gen- and experiences with the public. The Los erally designed to keep people informed of Angeles Games were of decisive importance what the OCOG was doing rather than to sell to Olympic PR evolution, as they applied a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 well-structured department format, providing programmes were classified into: direct public 2 future organizers with a lot more than just a relations, intended to support Games pro- 3 new idea for publicity. A brief description of grammes themselves, including activities 4 LAOOC PR practices is presented in Table 9.1. undertaken directly by the OCOG at home and 5 abroad, and those aimed at creating a 6 favourable environment and atmosphere, that 7 Seoul 1988 included support of direct PR programmes 8 through the media, various administration 9 The basic goals of the Seoul PR programme as channels and activities to raise people’s public 10 stated in the official post-Games report were: consciousness. 1 to create an atmosphere for the maximum The SLOOC took charge of direct public 2 public participation and stimulate public relations while the Ministry of Culture and 3 awareness domestically, and to win global Information along with other governmental 4222 support for Seoul’s hosting, ultimately draw- offices and private organizations handled 5 ing the participation of as many nations as public relations aiming at the creation of a 6 possible (SLOOC, 1988). Public relations favourable atmosphere. 7 8 9 Table 9.1 Los Angeles 1984 20 PR practices Description 1 2 1 Community relations The Community relations’ staff opened two ‘satellite’ offices, in combination 3 with the Olympic neighbours programmes provided Los Angeles residents direct and easy access to the OCOG. 4 5 2 Public information The need of the OCOG to assemble and disseminate information and respond to inquiries and requests was the reason for the set up of this division that 6 handled telephone and written requests, remote ticketing, info booths and 7 info kiosks. 8 3 Audio visual, radio and TV The division produced tapes and films that would help foster understanding 9 of the Organizing Committee’s planning, and promote public enthusiasm 30222 and support on the Games. More than 24 films and radio messages were 1 realized. 2 4 Speakers bureau In the five-year period during which the bureau operated approximately 2,000 3 speeches were made to an estimated audience of 560,000 people. The majority of speeches were during lunch or dinner hours to local businesses, 4 chambers of commerce, professional organizations, schools and service 5 clubs; 150 speakers from the local community and staff from the OC were 6 used. 7 5 Olympic spirit team Some 250 contemporary Olympic athletes voluntarily participated in an effort 8 to promote personal involvement and the support for the Games. 9 6 Publications Regular publications, such as the Olympic Update newsletter, informational 40 brochures, and other major projects, such as the Official Olympic Guide to 1 Los Angeles were designed and produced in collaboration with the Look 2 of the Games, and led a further step forward the Olympic publications history. 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Seoul followed the PR philosophy success- material, media relations, the Alcatel project, fully launched in Los Angeles, and gave the official newspaper and other publications importance to the two-way communication and public information. model, aiming at stimulating public aware- A change from the previous Olympiads, ness and involvement in the Games. A signifi- due to technological progress and the increas- cant novelty launched by the Seoul organizers ing information demand by the media was was the collaboration with an overseas public the Alcatel project. The need for a central relations agency, something that emphasized information system, that would allow fre- the professionalism required for the inter- quent updates at a considerably lower cost national relations of an OCOG. Special atten- compared to constantly revised publications, tion was also given to community relations, was evident. Spanish organizers, being tech- due to the Korean culture and traditions. nologically oriented, implemented a pioneer The Pansanghoe information sessions, public project, available to the Olympic family, other information allocation, events and local VIPs and media. The project however, was media relations consisted of particularly im- recorded as a forerunner of the idea for an portant means for the formation of favourable Olympic Games official website, that would opinion of the OCOG in the community. A allow international access and good value brief description of SLOOC PR practices is pre- publicity. A brief description of BOCOG PR sented in Table 9.2. practices is presented in Table 9.3.

Barcelona 1992 Atlanta 1996

Barcelona organizers having studied the previ- The Atlanta Olympic Games Organizing Com- ous two Olympic Games communication mittee (ACOG), chose to allocate tasks that activities realized that the scope of public were previously executed in the context of relations grew at a considerable rate, expand- public relations to two different programme ing to each and every single department of areas: communication, and government rela- the organization. The Barcelona OCOG was tions (ACOG, 1996). Communication staff the ﬁrst one not to use public relations as a were divided into four areas: media relations, title description of one of its main programme press operations, press information and public areas. The acknowledgement of the contribu- information. Government relations of the tion the organization structure made to the Atlanta OCOG included: federal government public image of the Olympic Games Com- relations, local government relations and mittee, led to the creation of a broad Image community relations. and Communication Division, that co-ordin- The Atlanta PR programme was one of the ated all the different sub-programmes in- most inclusive, combining some of the most cluded. The Image and Communication successful and well-tested projects, based on Division arranged for public attention and the effective two-way communication model. support for the Barcelona Olympic Games, Technology and the Barcelona innovation led signiﬁcant issues for the Spanish organizers Atlanta to operating the internet website, who worked to that end, through: promo- which served as a highly successful ambas- tional campaigns, distribution of promotional sador of the 1996 Olympic Games to the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 9.2 Seoul 1988 2 3 PR practices Description 4 1 Production of informational The OCOG produced various publications for use at PR exhibits and for 5 materials distribution to national and international publics. Overseas information 6 materials were distributed through either PR exhibits operated at major 7 events, overseas delegations or individual mailing. 8 2 Periodicals Three regular periodicals were published (quarterly, weekly and monthly). 9 During the Games an official daily newspaper was distributed to the 10 Olympic family and tourists. 1 3 Non-periodic publications Informational folders and booklets were published in many language editions, 2 carrying stories about Korean culture as well as information on Games, 3 cultural programmes and Olympic Games tickets. Small information items 4222 such as posters, stickers, badges, etc., were also produced, as well as a 5 pictorial publication titled ‘Games of the XXIVth Olympiad’. 6 4 Audiovisual material Five documentaries were produced, along with seven videos and multiple 7 slides. The films and videos that followed until the opening of the Games 8 also included information on tourism and accommodation, cultural events 9 and venue facilities. 20 1 5 Information centre A year before the opening of the Seoul Games, a public information desk was established at Kimpo International Airport. The desk served more than 2 600 people on an average-day basis, both Koreans and foreigners. A few 3 days before the opening of the Games, 23 information centres started 4 operating at the entrance of each Olympic venue. 5 6 6 Information and educational Several sessions were organized regularly in cities and provinces on the public relations progress of planning and preparations, as well as the effects of the Games 7 for Seoul and Korea. Sessions were held in 14 cities. Other activities were 8 the distribution of Olympic educational materials, speeches by leading 9 figures, a 24-hour telephone audio text service and the distribution of 30222 information in neighbourhood meetings. 1 7 Public relations on special A significant opportunity for public relations was the organization of events 2 occasions linked to the Games. The concept of countdown days to the opening of the 3 Games was also widely used for PR goals. Three large-scale events were 4 organized 500 days, 365 days and 100 days to the opening of the 5 Seoul Games. The inauguration ceremony of the olympic stadium 6 was also such an event. 7 8 Use of overseas PR Among the tasks taken over by the international PR agency was the 8 monitoring agencyof the trend of public opinion in many areas and the 9 arrangement of press interviews during major events. The agency also 40 published a quarterly full-colour newsletter, prepared major speech texts for 1 senior officials, provided counselling in media issues and prepared 2 documents, articles and scripts in English for publications and videos issued by the Seoul OCOG. 3222

PR practices Description

1 Promotional campaigns In 1989, two information campaigns were staged; ‘Barcelona ’92, three years before’, and ‘We’re getting on with it’, aimed at the people of Barcelona and Catalan to justify the inconvenience caused by the works. Also specialized campaigns were organized for the support of sponsors and licensees, the promotion of the state lotteries, increased awareness on the torch relay route, and ticket sales. 2 Promotional materials Licensed products were given away to journalists, schools, university and other community groups for PR purposes. Olympic families received a promotional item token from the organizers. 3 Media relations The press department organized a wide range of activities for the media such as press conferences, publications (a daily bulletin, a weekly newsletter, an updated press dossier every six months), PR events (e.g. Olympic tours) and a welcoming campaign designed for reporters from all around the world. 4 The Alcatel project The aim of the Alcatel project, named after the joint partner of the Barcelona OCOG, was to set up an information hotline to the world’s leading media, institutions and VIPs related to the Olympic Games, through nine information databases devoted to various subjects such as Spain today, Catalonia today, history of the Games, etc. 5 Publications During the day a daily newspaper was distributed for free in two languages. A monthly magazine, booklets for volunteer recruitment and training, information editions for all sports of the OG, guides, ofﬁcial programmes and ofﬁcial Games results book. 6 Public information Staff of the public information dept were responsible among other things for the information booths project, a series of information points in Barcelona and its suburbs for the public.

world public. The internet website was the environment enabled them to improve on the optimum method for transmitting PR inform- already successful programmes and take these ation about the Atlanta Games to worldwide one step further. A brief description of ACOG destinations, speeding up communication in a PR practices is presented in Table 9.4. sophisticated way (Oxley, 1987). Thus, there was a further expansion in the national and international target publics, while at the same Sydney 2000 time community relations strengthened PR messages to ensure effective community sup- The Sydney Organizing Committee (SOCOG) port and involvement. was mainly based on the example of Atlanta Atlanta organizers had the unique opportu- in the organization of its PR programme, nity to plan their Olympic Games public rela- taking it a little further with the technological tions, based on the expertise acquired by the help of the internet and the electronic Los Angeles Games in 1984. This, in combin- databases. In addition, the Sydney 2000 ation with the advances in the technological public relations made the transition from PR

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 9.4 Atlanta 1996 2 3 PR practices Description 4 1 Media relations During the 1996 Games, media relations worked also with press and 5 broadcasters on non-sports issues of the Games (Longhurst, 1996). 6 Media relations’ staff collaborated with all appropriate ACOG functional 7 areas to determine the best communication strategies for issues that would affect the public. Publicity campaigns were also implemented to 8 promote ticket and merchandise sales, Olympic arts festivals, test events 9 and recruitment of volunteers. Main tasks and achievements included: 10 the press guide, news conferences and news releases, venue tours, 1 media information line and issue management. 2 2 Press information Press information was given the responsibility to expand the scope of 3 information that would be provided to the media (Jefkins, 1993). 4222 Additionally, press information was responsible for the Atlanta Olympic News Agency, which served as a single news source during the Games 5 and ensured delivery of news and information to the media. 6 3 Press operations Press operations department planned and installed facilities that the press 7 would need during the Games, managing at the same time Games services 8 such as accreditation, accommodation and transportation. 9 4 Public information The public information division managed several programmes oriented to 20 general public inquiries. These were: The Olympic experience (a public 1 info gallery), speakers bureau (informed more than 1,500 groups), 2 information requests, worldwide website (the first official site and a big success, 200 million visits during the Games), call centre (24 hours, 7 days 3 per week) and Games time operations. 4 5 Government relations The primary missions of government relations were to facilitate 5 communication and co-operation between the various department of the 6 OCOG and the federal and state government. Second, the government 7 relations aimed at educating public officials on all aspects of the Olympic 8 Games. 9 6 Community relations This programme area was committed to improving all community areas 30222 affected by the Games and for that purpose several projects were developed such as: committee on disability access, Olympic environmental 1 support group, youth programmes, Atlanta University centre legacy, 2 interfaith advisory group and neighbourhood job training and employment 3 programme. 4 5 6 strategy to PR structure. The expanded struc- complexity of this task, and the increasing 7 ture introduced was a reflection of the organ- demand for targeting effectively the messages 8 izational PR enhanced strategy (Mintzberg, of the OCOG could not be satisfied through a 9 1990). single department in SOCOG, no matter how 40 Public relations evolution was based on wide in scope that would be. 1 the acknowledgement of the importance of a Communication and community relations 2 consistent and well-communicated overall incorporated the basic PR methods and 3222 organization image to a variety of publics. The principles, contributing to their evolution

PR practices Description

1 Community and public The management of community based PR activities and raising relations awareness of the 2000 Olympic Games among all Australians. National publicity was furthered for key programmes such as the national education programme, ticketing and consumer products through events and activities. The operation of the call centre was also among the projects undertaken by this department. The call centre operating since 1998, enabled Australians to obtain all the information they needed about the Games for the cost of a local telephone call. 2 Olympic communication Professional speakers were provided at a range of public events, from speakers bureau community meetings to corporate conferences. Speakers communicated desirable SOCOG messages and informed the public on their involvement opportunities in the Games. 3 Olympic 2000 national The programme reached over three million Australian students, through a education range of education projects. These included distribution of Olympic publications and CD-roms promoting the Olympic ideals and enhancing the notion of volunteerism. Additionally, the ‘share the spirit’ art competition was organized for Australian students up to 12 years old, while a special section for students, named KIDS was introduced in the Sydney 2000 Olympic Games website. 4 Multicultural affairs This programme was a special addition in the organizational structure due programme to the special multicultural Australian environment (Banks, 1995). The programme ensured that all SOCOG Programmes incorporated the needs of Australia’s diverse communities in their planning for the Games. Through a multicultural affairs programme, SOCOG reached out to multicultural communities through newsletters, community briefings and events and the mainstream of ethnic media. 5 Public information The public information co-ordination (PIC), provided a centralized store co-ordination of public information services and systems. The PIC oversaw the development and maintenance of SOCOG’s key internal communication database, Athena, which carried regularly updated information for use across the organization, and externally through the official website and the call centre. 6 Publications This programme managed and produced hundreds of publication projects, as was the case in previous Olympiads. 7 Internet The official Games internet website enabled worldwide access to. information and gave people the potential to buy tickets and licensed products of the Sydney 2000 Olympic Games. The public information department was responsible for feeding the website with constant information and news updates. 8 Research and information The programme maintained SOCOG’s archives and library collection, providing access to online databases that facilitated research. 9 Other programmes Other programme areas that contributed to SOCOG’S success were: media information, government relations, aboriginal and Torres Strait Islanders relations and international relations.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 according to the specific Australian cultural Public relations evolved through the years, 2 needs. Nevertheless, it was the active and changing from one prevailing model to 3 long-lasting involvement of more than that another. In theoretical terms this evolution can 4 one department that actually Sydney offered be described through the models proposed by 5 to the PR evolution of the Organizing Com- Wilcox et al. (1998): (1) The model of public 6 mittees for the Olympic Games. Communi- information: this primary form of public rela- 7 cation and community relations, however, tions was focused on the dissemination of 8 was the main division responsible for manag- information, not necessarily with a persuasive 9 ing the SOCOG’s communication with corpor- intent. It was based exclusively on one-way 10 ate businesses, community and sporting communication, viewed only as transmitting 1 groups, tourism bodies, venue and host coun- messages, without any interaction with the 2 cils, schools, ethnic communities, media and publics, as little, if any, research was under- 3 the general public. The division also managed taken. (2) Two-way symmetric: the purpose of 4222 SOCOG’s PR agency, Capital Public Relations, this model is gaining mutual understanding, 5 briefing the company on the SOCOG’s major and communication is two-way with balanced 6 communication and promotional campaigns effects. The model includes feedback from the 7 and overseeing project delivery. publics. Research is used both to learn how 8 The objectives set by the Sydney 2000 the public perceives the organization and to 9 Olympic Games OCOG PR programme may be determine what consequences the organiza- 20 summarized as: (1) the co-ordination, facilitation has for the public, resulting in the coun- 1 tion or provision of the necessary mechanisms selling of management about policies. 2 and material for SOCOG interactions with Evaluative research is used to measure 3 government, community groups and the whether a PR effort has improved both the 4 public; (2) provision, for all SOCOG divisions understanding publics have of the organiza- 5 and programmes, of service and advice on tion and that which management has of its 6 public relations, issues management and publics. It is to be noted that the Los Angeles 7 government relations, and assistance to the Olympic Committee attempted first to 8 media relations programme on matters of develop a two-way communication model in 9 public and media interest; and (3) co-ordina- the history of the Games. 30222 tion of the material used for SOCOG publica- As previously presented, public relations in 1 tions for consistency of information and organizing committees should not be viewed 2 messages (SOCOG, 1999) (see Table 9.5). as simple publicity and one-way communica- 3 tion, but as a strategic process of negotiation 4 with a number of key publics. Taking into con- 5 Conclusions and suggestions for sideration all the above, a framework for 6 future organizers future organizers is presented in the following 7 paragraphs. 8 The roots of public relations for the Olympic 9 Games extend deep in the ancient Games. 40 Generating publicity for the Olympics in PR research 1 ancient Greece demanded the same skills as it 2 does in the modern Olympics (Wilcox et al., Effective public relations are processes, and 3222 1998). the essential first step is research. In basic

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors terms, research is a form of listening. Before Publications and audiovisual material should any PR programme can be undertaken, always be considered as a complementary information must be gathered, data collected way to approach publics, through a series of and interpretation done. Then, the organiza- projects that encourage active participation tion can begin to map out policy decisions from the public (Epov, 1986). and strategies for effective communication.

Communication projects Communication within the organization Internet website The term ‘interactivity’ is usually used in con- Taking as an example the organizational struc- nection with the latest technology achieve- tures in Sydney and Atlanta, it is understood ments, as these are two-way communication that public relations could no longer be con- oriented. As interaction is a necessity for cur- ceived as an individual part of the organiza- rent public relations, an official Olympic tion. On the contrary, communication links Games website is a lot more than desirable. should be developed among the different The internet secures information penetration divisions in future Olympic Games organizing to a global public in a direct and effective way. committees that would allow the imminent An OCOG should definitely take advantage of flow of information and promotion of mes- this low-cost opportunity for international sages. Athena, the electronic database oper- exposure, which could also be used for com- ated by Sydney OCOG, containing media mercial exploitation (Howard, 1998). releases, a weekly workforce newsletter, and several reports, accessible by all Sydney Call centre employees, could provide a basis for internal The call centre operation is a project of signifi- communication advancement. An electronic cant sensitivity. People employed in the call information database would result in saving centre should have advanced communication considerable time and effort for interested skills and be well trained and constantly parties, and providing accurate and updated updated on major issues that could raise information starting from each organizational public interest. Call centre employees offer for division and reaching a wide range of publics. many people the only immediate contact with the Games OCOG. Therefore, the impressions formulated after contacting the Games Public information call centre often influence public disposition towards the overall OCOG and the Olympic Featuring interactivity in communication has Games themselves. The success of the call proved essential for actually capturing and centre, however, is dependent on two factors: involving people in the Olympic Games. the use of a large and dedicated volunteer Publications were a well-known long-lasting workforce and a flexible staff structure, which tool for Games organizers to promote their would combine both centralized and venue- messages; however, they could no longer be oriented responsibilities. The amount of cross- solely used to accomplish the PR goals set. training and dual responsibilities shared

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 between venue operations and the phone Community relations 2 bank should allow for maximum intercom- 3 munication and exchange of information. An Community involvement opportunities 4 overall programme for similar direct com- Two major projects that require community 5 munication between future Olympic organiz- involvement are volunteerism and torch 6 ing committees and the local, national and relay. Special publicity, including speeches, 7 international publics is strongly encouraged. publications and events should be organized 8 to inform the public of these opportunities to 9 Speakers bureau participate in the Games (Burke, 1999). 10 The establishment of a speakers bureau allows 1 spreading of information to interested parties 2 in a more active and detailed way. The OCOG Educational programme 3 would be able through its speakers to reach an 4222 extensive variety of groups, of different inter- In co-operation with the government the 5 ests and concerns, carrying enthusiasm for the OCOG should give emphasis in educating 6 Games and aiming to found public support. people and particularly students on the 7 This project underlines the substantial atten- Olympic Games values. The example of 8 tion given to community understanding and Sydney organizers who realized the import- 9 acceptance, enhancing the community profile ance of supporting an educational pro- 20 gramme should be taken further. Additional of the OCOG. Training and constant news 1 features of the programme could include lec- updates to speakers, as well as suitable speak- 2 tures and seminars, film projection and publi- ers selection are essential to the success of the 3 cations distribution, and motivation for programme. Los Angeles OCOG being the first 4 participating in less popular Olympic Games to have introduced a speakers bureau, did so 5 sports. To conclude, as the ultimate purpose with careful planning and selection proced- 6 of public relations is to generate publicity, ures, which should be followed by future 7 media exposure is considered vital for the suc- 8 organizers as well (Macnamara, 1996). cess of any PR project. For that purpose, media 9 relations should never be overlooked. On the 30222 Events contrary, all opportunities for promoting PR 1 Public relations events should be optimum to activities through the media should be 2 generate enthusiasm and promote favour- exploited. 3 able messages (Haberman and Dolphin, The completion of this research has con- 4 1988). Media coverage is an important firmed the original hypothesis that there is 5 prerequisite for the success of the events, connectivity among the various public rela- 6 which should be organized in a special con- tions programmes as exercised by OCOGs. 7 text, as could be Olympic Games countdown Furthermore this connectivity is expressed in 8 days, first launched by Seoul OCOG. an evolutionary pattern. Each organizing body 9 Events should be organized by as many for the Olympic Games has introduced at least 40 departments of an OCOG as possible, in order one new public relations programme. This 1 to raise public awareness and communicate may be justified due to the cultural differences 2 the multiple dimensions of the Olympic among the different host cities. The only 3222 Games organization. country to host two Olympic Games in the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors twenty years of observation was the United Additionally, crises management issues should States. Los Angeles and Atlanta, in 1984 and be addressed, in conjunction with reactive PR 1996 respectively, contributed significantly to and media predisposal to the Games. The the evolution recorded. This enables us to effect of technological advancements in realize that the organization of the Games in public relations could also comprise a research one country every four years would benefit topic. the overall progress of the Games. However Finally, it should be taken into account the multicultural dimension of the Games that this research was completed before the allows the integration of a model that could Sydney 2000 Olympic Games, which does be adjusted to every culture, however differ- not allow an overall appraisal of the practices ent this could be. performed by the public relations of SOCOG. As observed the current tendency in the This specific time frame was chosen with the organizational PR field is related to technol- aim of maintaining objectivity towards the PR ogy. Internet and other communication appli- programme, as developed, irrespectively of ances will play a vital role in the advancement the Games impressions. However, the fact that of public relations, to a far wider audience in the research took place during the prepara- a significantly shorter time frame. The co- tions for the Sydney Games could raise a ques- operation that started through the transfer of tion of subjectivity. The research was knowledge programme under IOC co-ordina- completed one day before the opening of the tion is also an effective way of communication 2000 Olympic Games. This allowed for as and easier issues resolution. In the era of com- extensive as possible a coverage of the PR munication explosion and globalization, practices implemented and any problems public relations could only grow towards this related to these. The lack of related research direction, according to the original universal studies in the field of public relations both in spirit of the Olympic Games. OCOGs and sport organizations does not allow The present research opens additional comparative evaluation. The literature re- fields for exploration to future researchers as viewed for that reason derives from the well. A more detailed analysis of specialized broader organizational PR area. In the end it is PR areas such as media relations, press rela- to be noted that this chapter has referred only tions, government relations and community to the specific PR requirements of Olympic relations is required, to name but a few. Games organizing committees.

REFERENCES

Atlanta Organizing Committee for the Olympic Games Burke, E. (1999) Corporate Community Relations: The (ACOG) (1996) Ofﬁcial Post Games Report of the Principle of the Neighbor of Choice, Westport, CN: Centennial Games, Atlanta, GA. Quorum Books. Banks, Stephen P. (1995) Multicultural Public Relations: Epov, P. (1986) The Marketing and Public Relations A Social-interpretive Approach, Thousand Oaks, Manual, Lidcombe, NSW: Peter Epov Sports CA: Sage. Marketing Pty. Barcelona Organizing Committee for the Olympic Haberman, D. A. and Dolphin, H. A. (1988) Public Games (BOCOG) (1992) Official Post Games Report Relations: The Necessary Art, Ames, IA: Iowa of the 25th Olympiad, Barcelona. University Press.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Howard, S. (1998) Corporate Image Management: Marconi, J. (1996) Image Marketing: Using Public 2 A Marketing Discipline for the 21st Century, Perceptions to Attain Business Objectives, Lincoln- 3 Singapore: Butterworth-Heinemann Asia. wood, IL: NTC Business Books. Jefkins, F. (1993) Planned Press and Public Relations, Mintzberg, H. (1990) ‘The design school: reconsider- 4 Glasgow: Blackie Academic and Professional. ing the basic premises of strategic management’, 5 Longhurst, J. (1996) Making the News: A Media Strategic Management Journal, 11, 171–95. 6 Relations Manual for Nonprofit Organizations, Oxley, H. (1987) The Principles of Public Relations, 7 Winnipeg: Windﬂower Communications. London: Kogan Page. 8 Los Angeles Olympic Games Organizing Committee, Seoul Organizing Committee for the Olympic Games 9 (LAOOC) (1984) Official Post Games Report of (SLOOC) (1988) Ofﬁcial Post Games Report, Seoul. the Games of the XXIIIrd Olympiad, Los Angeles, Sydney Organizing Committee for the Olympic Games 10 CA. (SOCOG) (1999) Annual Report, Sydney. 1 Macnamara, J. R. (1996) Public Relations Handbook for Wilcox, D. L., Ault, P. H and Agee, W. K. (1998) Public 2 Managers and Executives, revd edn, New York; Relations: Strategies and Tactics, 5th edn, New 3 Sydney: Prentice Hall. York: Longman. 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

T. C. Melewar and Christopher D. McCann

This chapter discusses some of the issues surrounding the use of corporate branding in an international context. It examines the issues of communication of corporate values to a global audience and the importance of establishing corporate brands is considered through analysis of a case study. Makita Corporation in Japan is an 85-year-old established company that operates in the global small power tools and accessories market. The authors suggest that three key facets of global corporate brand are: communication of a consistent message; organizational support of brand image; and control and standardization to add value to new products and entrance into new markets.

Introduction factors contribute to this success. First, images determine people’s attitudes and behaviour; a Why are there so many television pro- positive image can help create and support grammes, books and magazines devoted to a company or its products. Second, the image business? A large part of it is because business is a mixture of appearance and behaviour has such a profound inﬂuence on our lives. – one needs to support the other. Lastly, to Business is a spectacle; a drama ﬁlled with succeed one needs to be a good commun- excitement and adventure. The actors in this icator. As soon as one extends this drama/ drama are the companies who use their business analogy to an international environ- image or actions to create the drama and ment these success factors become even more intrigue in order to get people on their side. complex and challenging. One way inter- We interpret companies by their outward national companies could reduce the com- signs, such as advertising brochures and plexity is through corporate brands. Corporate reported performance. As in successful drama, brands provide effective and consistent com- businesses need to communicate their mes- munications that have an increasing role to sage effectively to be successful. A number of play in the drama we call business.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Meaning of the corporate brand organizations and what values they bring to a 2 brand. In the next few sections we discuss the 3 Corporate branding is generally considered facets of corporate branding in the inter- 4 important, but at the same time difficult to national context (see Figure 10.1). 5 define. Both of the words ‘brand’ and ‘corp- 6 orate’ carry certain connotations. ‘Corporate’ 7 implies organization – both profit and non- Communication of consistent 8 profit. What defines it as corporate is its cohe- message 9 sion; the idea of people coming together and 10 working towards a common goal (Stuart, In an effort to create tangibility, communica- 1 1999). At the same time there are factors, par- tion for corporate brands should operate on 2 ticularly of large organizations, that serve to both the micro and macro levels. On the 3 diffuse this meaning of corporate. Different macro level, a key part of the corporate brand 4222 parts of the organization can develop their is determining what values the company 5 own, often contradictory, directions. This wants to be known for, then communicating 6 implies the need to understand the organiza- them outward. When we buy a product brand 7 tion as a part of the term ‘corporate brand’. we can touch or feel the product. We may not 8 Traditionally, a brand is a descriptor applied know or understand its make-up, but we can 9 to a good. It is distinct from the idea of a prod- describe its attributes. Even though each indi- 20 uct in that with a brand there is the notion of vidual has a unique perception of the com- 1 values that go beyond mere functional pany, there is still the need to try to build a 2 performance. When tying the two words consensual image. In reality we often glean in- 3 together one suggests a new way of looking at formation from a company’s communication, 4 5 6 Communication of 7 consistent message 8 9 30222 1 Entrance into new Organization support 2 markets of brand image 3 4 Corporate brand 5 6 7 8

9 Add value to new Control and 40 products standardization 1 2 3222 Figure 10.1 Facets of the global corporate brand

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors its people and its products, and we make to buy the same things around the world judgements. We see and hear a company’s (Jain, 1989). Third, global media helps to message and experience its products or people define more universal lifestyles (Jallat and and we construct an image of the organiza- Kimmel, 2002). All of these factors favour tion. Research indicates that the more familiar corporate brands, particularly western brands, we are with a brand the more favourable we that allow them to be easily adapted to interview it (Ind, 1997). This requires a consistent national markets. message to all stakeholders. Although a brand has some tangible elements, a company is often seen as very Entrance into new markets remote. Corporate branding allows organizations to communicate one message as to what Generally, in any company there is a clear it is and how it wishes to be represented association between products and the organ- (Sellers, 2002). With product brand a unique ization that produce them (Olins, 1989). The message for each brand is communicated. nature of the product influences an organiza- Consistency in communication is, therefore, tion’s culture and identity, while the identity vital. On a micro level, the brand needs to in turn influences the nature of the product. build an interactive relationship with each This link between product brand and com- individual stakeholder. This involves providing pany brand allows these two entities to easily a product that meets the needs and wants of enter markets where that brand is already the customer. In the international context and somewhat known. When considering inter- on the micro level this can prove quite chal- national expansion there are traditionally lenging. In contrast, on the macro level this is two alternatives – the ‘waterfall’ and ‘sprink- an advantage in that it is easier to uniformly ler’ methods (Keegan, 1989). The ‘waterfall’ convey the corporate values such as quality, method is a trickle-down model where prod- value for money or reliability. These terms are ucts are launched in countries based on level easier to communicate than product differ- of development – prioritizing the most devel- ences that may be difficult to adapt to inter- oped countries first. This method ensures national tastes. Because of this, corporate that the product is exactly suited to the cus- brands can only truly be successful if there is a tomer. The disadvantage is that it can take up relationship established at an appropriate to several years to fully enter new markets micro level. globally. The effectiveness of corporate brands inter- The contrast to this is to develop a product nationally is, to a large extent, improved and simultaneously introduce it to world through globalization. Several global drivers markets (sprinkler model). The difference be- support this. First, demographic trends across tween the two methods is based on the the developed world are very similar; an assumptions about the nature of the world ageing profile, an increase in single-occupant markets. The sprinkler approach recognizes households and a declining population the trend of globalization and that markets (Hassan and Katsanis, 1991). Second, global develop simultaneously around the world. products and advertising help to ensure that This requires substantially less time and is people are aware of the same things and able viewed by many as the only realistic option

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 in today’s fast paced global competitive en- lies. As we have mentioned earlier, global- 2 vironment (Riesenback and Freeling, 1991). ization has resulted in people having more 3 The use of the corporate brand with the sprink- information on brands from around the 4 ler method of product introduction allows world. By combining this goodwill with 5 more consistent product introduction into the global familiarity corporations can easily 6 international markets. leverage this brand into international markets 7 (Ekuan et al., 2001). 8 9 Adds value to new product 10 Control and standardization 1 As people have become more aware of the 2 world around them they also have become When considering a corporate brand in the 3 more confident as consumers. People have far global context a number of consolidation 4222 less inhibition about exploring new experi- issues become relevant. Unified marketing 5 ences and trying out new brands for different communication ensures a consistent message 6 occasions. In other words, people are no worldwide that can lead to increased sales 7 longer loyal to their brands. This lack of loy- (Buzzell, 1968). Furthermore, research by 8 alty is a challenge for companies and much Sorenson and Wiechmann (1974) concluded 9 promotion is spent to address this issue. Many that ‘standardisation makes consumers famil- 20 corporate brands have begun loyalty pro- iar with the company and its products and 1 grammes or relationship marketing initiatives. services, and helps establish a uniform corpor- 2 The goal here is for consumers to have an ate image’. Standardization of marketing 3 emotional attitude towards a brand or a com- efforts is often achieved through a centralized 4 pany. This is not the same relationship we corporate function. These two statements sup- 5 have with families or friends but a ‘business’ port the overall use of a corporate brand in 6 relationship built around mutual benefits. the marketplace. This is an important issue 7 8 These mutual benefits are ultimately trans- in the international context as a study indi- 9 ferred via a product or service. cates that centralization often flows from the 30222 The purchase of a product is only the needs of globalization (Melewar and 1 beginning of the relationship – it is the use of Saunders, 1999). Very often centralization is 2 the product over time that either cements seen as a necessity in determining corporate 3 or dissolves the relationship. The implication communication. Consistency is possible only 4 of this is that the consumer builds a relation- when there is a single and sufficiently power- 5 ship not with the product itself but more ful source of authority. In the end, someone 6 with the company that provides it (Eales, must decide an approach and then impose 7 1989). As a result, well-regarded corporate strict control over this communication. 8 brands are able to deliver products with Implementation has to take into account 9 ready-made goodwill. Companies can use this the organizational structure. If the individual 40 to introduce new products more easily. At the countries enjoy significant autonomy then 1 same time, it is easier to diversify their trying to impose central control will be 2 product portfolio by introducing completely difficult. Hence, the degree of centralization 3222 new, or new to the company, product fami- influences the degree of standardization of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors the corporate brand identity of multinational Organization support of brand companies. Even though the literature is image somewhat divided as to the degree of centralization, most do agree that it is an important People are the corporate brand (Hatch, factor when considering corporate branding 1993). They interact with audiences and each (Roellig, 2001; Walton, 2001; Rosen et al., other, make the products and perform the ser- 1987). vices that the organization sells, and define The financial arguments in using a stan- and create marketing communication strat- dardized corporate brand are fairly straight- egies. Perceptions of an organization are forward. Economies of communication can be determined, directly and indirectly, by man- achieved by producing advertising campaigns agers and staff. It is their values and their per- and other promotions which can be run any- ception of what the organization and the where in the world with only minor changes. corporate brand stand for that give it cohesion However, the scale of these savings is still and meaning (Hatch and Schultz, 2000). under debate (Riesenback and Freeling, It follows then that an organization’s corp- 1991). Companies with a large advertising orate brand can be maintained and often budget felt the cost savings from standardiza- improves by concentrating on its relationship tion were a small percentage of the total with its employees. Key to the success of this is budget. On the other hand, companies with a the employee identification with the strategy small advertising budget felt that the savings of the organization. To some extent this from standardization were high. In successful requires an empathy with the organizational global campaigns, it is outstanding creative values so that there is a match between ideas, not budget dollars, which are truly the individual’s beliefs and the employer’s in short supply. Thus, the meaningful goal is (Ind, 1997). This empathy can be developed to seek to increase sales through consistency, through a number of ways including effective rather than to reduce costs by compromising communication and employee development. the focus of the marketing effect. Effective internal communication needs As discussed above, it is this consistent to concentrate on developing a feeling of corporate message that is important in the involvement and empowerment. Effective international context. By and large, things employee development ensures that con- such as names and logos should be seen as sumers and other audiences will interact with integral to the corporate brand and should better-educated and more committed individ- be co-ordinated centrally (Topalian, 1984). uals. As well as improving the image of the As we move downstream (towards the end organization, employees can help the organ- customer) the case for adaptability becomes ization adapt to a changing environment and greater. The communication objectives may learn new ways of doing things. This becomes be different depending on the situation. even more important as a company begins When entering new markets the communica- to expand internationally. Managers need to tion may need to solidify or build brand build awareness for their new brand and awareness. In countries where the brand consequently need information regarding the awareness is higher, brand owners may want local environment (Simoes and Dibb, 2001). to concentrate on highlighting those factors This process is facilitated by technology, that can be seen as differentiators. notably the corporate intranets. This allows

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 managers and employees to keep up with steadily during the 1960s and 1970s and in 2 what is happening in various parts of the 1970 established its first outlet outside Japan 3 organization that can influence them. In the – in the United States. Makita continued to 4 next section we discuss the issues that have expand internationally during the 1970s 5 been raised in the context of a company and 1980s setting up operations in most of 6 called Makita Corporation. continental Europe. Through the 1990s the 7 company established itself in Eurasia as well 8 as China. The company presently has sales 9 Makita Corporation subsidiaries in over thirty countries and pro- 10 duction facilities in the United States, Canada, 1 Makita’s aim is to become the best supplier United Kingdom and China. 2 of electric power tools world wide, includ- 3 ing battery operated power tools, wood 4222 working machines, pneumatic tools and Communication of consistent 5 garden tools all of which makes living much message 6 more comfortable and enjoyable. 7 (www.makita.co.jp) Since its creation in Japan the goal of Makita 8 was to produce products of superior quality. 9 Makita is a global producer of professional- This goal is communicated very strongly 20 grade electric power tools. The company through a large proportion of their marketing 1 makes jigsaws, planers, drills, hammers, communication. The brand and logo used are 2 grinders, sanders, stationary woodworking the same around the world. The advertising 3 machines, garden tools, and other household for Makita is fairly consistent in design and 4 products. Already having a worldwide pres- message where it highlights quality as the 5 ence, Makita has made significant gains in differentiating factor over the competitors. 6 High quality is supported internationally 7 market share in the Americas, Asia, Europe, 8 and Australia/New Zealand, where it is an through its subsidiary network of service cen- 9 industry leader. Sales in 2001 were over one tres. In larger countries (United States, 30222 billion US dollars with a sales growth of 25 per Australia and Mexico) there is a regional 1 cent. More than three-quarters of sales are centre owned and operated by Makita in 2 outside Japan. Makita operates with about addition to approved service providers. This 3 eight thousand employees in more than thirty allows Makita to ensure consistent quality and 4 international subsidiaries. the company can boast one of the fastest turn- 5 Makita began operation in Nagoya City, around times for repair and delivery in the 6 Japan in 1910 producing lighting equipment, industry (www.makita.com). The key market 7 transformers and motors. After the Second for Makita products is the construction indus- 8 World War the company moved to Sumiyoshi- try and advanced DIY. Both of these industries 9 Cho, Anjo-City and began producing electric are fairly consistent globally, which allows 40 planing equipment, the first in Japan. The Makita to use a strong corporate brand. On a 1 company continued to produce innovative micro level, they establish a relationship char- 2 products and in 1960 changed its name to acterized by high quality and effective after 3222 Makita Corporation. The company grew sales support and service.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Entrance into new markets product innovation resulted in varying degrees of quality as well as higher production Makita began its expansion internationally at costs. Makita successfully entered this market the beginning of the 1960s. From the begin- by following their strategy of producing and ning the company goal was to produce and marketing globally standardized products sell products of the highest quality and pro- worldwide. This allowed them to establish vide superior service. In order to achieve this, themselves as a low-cost producer and Makita had a policy of manufacturing the allowed them to steadily increase market products close to the customer. After Makita share. This situation continued until Black & had sufﬁcient production in Japan it began Decker adopted a similar process using central expanding in Europe by setting up Makita R&D and product development. subsidiaries. The subsidiaries in turn began establishing a network of approved service providers. Makita expanded in this fashion Control and standardization since it recognized that in the electric power tool market word-of-mouth communication is The Makita logo is used consistently through- one of the most effective ways of promoting a out the organization. The logo and its use are new brand. Following its general policy the same on all marketing materials. Most regarding close production and as demand decisions regarding logo and marketing of the and the number of subsidiaries increased, brand are centrally taken in Japan. At the sub- Makita established production facilities in sidiary level, advertising is adapted through Europe and North America. Overall, Makita local language with limited changes to the grew its corporate brand by establishing con- other elements of the promotion. All products sistent values and used these values to enter are designed following similar design themes new markets and expand globally. and have a very consistent ‘look’. One product characteristic that has emerged as part of the brand is the use of colour. Makita uses a ‘blue- New product development and green’ colour as a consistent design element in standardization most of its marketing materials. More importantly, all of its products, to a large extent, use In the late 1980s Makita ﬁrmly established the same ‘blue-green’ colour as well. itself in the North American market. Their Overall, Makita has successfully used its brand was successful in that it represented corporate brand to communicate its values quality and service. During this time their of innovation and quality on a global scale. It main competitor was Black & Decker who had has complemented this with establishing a substantial market share. Black & Decker had relationship on the micro level with its stake- similar products of a slightly lower quality. holders based on its high level of service. It Their products and marketing were not, how- has used its brand to effectively expand to ever, standardized throughout North America. other regions while at the same time manag- Black & Decker had different products in ing the same value proposition to its cus- different parts of the world under various tomers. Makita has supported these corporate smaller brand names. This lack of standard- values – innovation and quality – through cen- ization, particularly in the area of R&D and tral R&D and product development resulting

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 in innovative products of a consistently high same thing. This is particularly acute in the 2 quality. international context. This is also supported 3 by the growing trend of globalization in that 4 people travel much more, making familiar 5 Conclusion and recommendations global brands more effective. 6 The final requirement of an effective corp- 7 This chapter has highlighted some of the orate brand is interaction. To make sure that 8 issues surrounding the use of a corporate an organization is meeting the need of its 9 brand in the international context. The corp- customers and that its communication is rele- 10 orate brand is distinct in that it has a very vant, it needs to build relationships with its 1 diverse audience that it needs to interact with. audiences. This is particularly true in an inter- 2 Corporate brands need to balance between national context. With a global organization it 3 the needs of the employees and customers as needs to listen to the different perspectives 4222 well as investors. To be successful, it needs and requirements from both the customers 5 to make the most of the employees’ and and its employees in each country. Without 6 organization’s abilities, attract the goodwill this the organization will lack the fundamental 7 of investors and meet the demands of cus- ingredients necessary to make a strong corp- 8 tomers. orate brand. 9 To facilitate the above, corporate brands The secret of building an effective corpor- 20 need to maintain familiarity. Familiarity is ate brand is not complex, but rather it is 1 partly formed through products but often through doing simple things well: listening to 2 is the result of marketing communication and involving customer and employees, 3 and interaction with the organization. Because developing relationships and integrating con- 4 of this, consistency is very important. From a sistent internal and external communication. 5 communication perspective consistent organ- The challenge internationally is finding the 6 izations are more likely to achieve recognition right balance of adaptation of all these simple 7 and understanding if they keep saying the elements. 8 9 30222 REFERENCES 1 2 Buzzell, R. D. (1968) ‘Can you standardise multi- Hatch, M. J. (1993) ‘The dynamics of organisational 3 national marketing’, Harvard Business Review, culture’, Academy of Management Review, 18, December, 102–12. 657–93. 4 Eales, R. (1989) ‘Multinational report: multinational Hatch, Mary Jo, and Schultz, Majken (2000) ‘Scaling 5 corporate communications, a growth sector’, the tower of Babel: relational differences 6 Multinational Business, 4, 28–32. between identity, image and culture in organisa- 7 Ekuan, K., Francey, P., Van Niekerk, R. and Butler, D. tion’ in Majken Schultz, Mary Jo Hatch and 8 (2001) ‘Powerful brands: perspectives of design Mogens Holten Larsen (eds), The Expressive 9 managers from around the globe’, Design Organisation, Oxford: Oxford University Press. 40 Management Journal, 12(1), 57–67. Ind, Nicholas (1997) The Corporate Brand, London: Hassan, S. S. and Katsanis, L. P. (1991) ‘Identification Macmillan. 1 of global consumer segments: a behavioural Jain, S. C. (1989) ‘Standardisation of international 2 framework’, Journal of International Consumer marketing strategy: some research hypotheses’, 3222 Marketing, 3(2), 11–28. Journal of Marketing, 53, 70–9.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Jallat, F. and Kimmel, A. J. (2002) ‘Marketing in cul- Sellers, L. J. (2002) ‘Building corporate brands’, turally diverse environments: the case of Western Pharmaceutical Executive, 22(1), 38–44. Europe’, Business Horizons, July–August, 30–6. Simoes, C. and Dibb, S. (2001) ‘Rethinking the brand Keegan, W. J. (1989) Global Marketing Management, concept: new brand orientation’, Corporate New York: Prentice Hall. Communications: An International Journal, 6(4), Melewar, T. C. and Saunders, J. (1999) ‘International 217–24. corporate visual identity: standardisation or Sorenson, R. Z. and Wiechmann, U. E. (1974) ‘How localisation’, Journal of International Business multinationals view marketing standardisation’, Studies, 30(3), 583–98. Harvard Business Review, May–June, 38–54 and Olins, W. (1989) Corporate Identity: Making Business 166–7. Strategy Visible Through Design, London: Thames Stuart, H. (1999) ‘Towards a deﬁnitive model of the and Hudson. corporate identity management process’, Corpor- Riesenback, H. and Freeling, A. (1991) ‘How global ate Communications: An International Journal, 4(4), are global brands?’, The McKinsey Quarterly,4, 200–7. 3–18. Topalian, A. (1984) ‘Corporate identity: beyond the Roellig, L. (2001) ‘Designing global brands: critical visual overstatements’, International Journal of lessons’, Design Management Journal, 12(4), Advertising, 3, 55–62. 40–5. Walton, T. (2001) ‘The nuances of designing for Rosen, B. N., Boddewyn, J. J. and Louis, E. A. (1987) global markets’, Design Management Journal, ‘US brands abroad: an empirical study of global 12(4), 6–9. branding’, International Marketing Review, 6(1), www.makita.co.jp 7–19. www.makita.com

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 11 2 3 4 Differing corporate communication practice 5 6 in successful and unsuccessful companies 7 8 Colin Coulson-Thomas 9 10 1 2 3 4222 5 When we discuss corporate communication we generally assume that effective com- 6 munication is a ‘good’ thing. But what do we mean by ‘effective’ in the reality of today’s 7 turbulent and competitive marketplace? How vital are corporate communication 8 activities? 9 In this chapter the author looks at how communicators actually behave in practice. He 20 examines what winners, people in successful companies that cope with changing circum- 1 stances and grow, do differently from losers, their colleagues in business that struggle 2 and fail. The chapter looks at differing attitudes and approaches in order to distil some 3 critical success factors for managing change, competing and winning and considers the 4 5 role that external and internal communication plays in relation to winning competitive 6 bids, relationship building and managing change. It also considers the issue of differen- 7 tiation and the international dimension before drawing out some key differences 8 between attitudes, behaviours and approaches of winners and losers. 9 30222 1 2 3 Many businesses win a significant proportion also become more demanding. Proposals get 4 of major new contracts through some form of larger and more expensive to prepare. The 5 bidding process. Competitive markets and cost of lost bids has to be recovered out of a 6 falling barriers to entry have strengthened the squeezed margin on those that are won. 7 negotiating position of buyers. As more con- Companies that win too few bids find them- 8 tracts are put out to competitive tender and selves driven out of business. Corporate sur- 9 new entrants to markets are invited to bid, the vival can depend upon success in competitive 40 prospects of a supplier winning a particular bid situations. 1 opportunity can decline unless performance is Yet some companies – according to the flow 2 improved. of reports from the Winning Business Research 3222 As expectations rise, invitations to tender Programme at the Centre for Competitiveness

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors (see www.luton.ac.uk/cfc) – are much more In businesses with below average success successful than others at winning business. rates bid team members are left to ‘get on Studies which have been undertaken cover with it’. Senior managers may talk of proposal many sectors, particular sectors (construction, preparation as a ‘boring’ chore and one best engineering and manufacturing, IT and tele- avoided. They are rarely involved in individ- coms) and eight professions ranging from ual opportunities. lawyers and accountants to engineering and Losers measure success by the number of management consultants. proposals they submit. They make little effort The findings are consistent and compelling. to learn from either their experience or best Let us consider the evidence of a study of how practice. Rejection letters enable them to people in 293 companies set about ‘winning ‘close the file’ and move onto the next pro- major bids’ (Kennedy and O’Connor, 1997). posal. Above all, they don’t mind losing. A wide gulf exists between winners and losers. Failure is accepted as the norm. It is rational- The two groups appear distinct species with ized with phrases such as ‘you can’t win them different personalities. Losers are undisci- all’ or ‘someone has to lose’. plined, unimaginative and reactive. They pur- Winners who submit successful bids and sue far too many opportunities, and they make effective presentations behave very dif- focus primarily upon their employers’ ferently from the losers just described. They immediate concerns and sales priorities. are far more confident, energetic and proac- Members of ‘loser’ bid teams respond tive. They identify prospects with growth mechanically to invitations to tender. They are potential, organizations that are likely to do preoccupied with the practicalities of produc- well and which would make good business ing proposals and problems such as obtaining partners. They take the initiative. They cost information and up-to-date CVs from approach those they would most like to do busy colleagues. They find themselves under business with. They carefully target their com- pressure to meet submission deadlines. Yet munication. they ignore tools that could speed up their Winners are very selective. They ruthlessly basic activities and free up thinking time. prioritize available opportunities. Turning Little effort is put into distinguishing the down some invitations to bid allows more approaches or ‘solutions’ they recommend. effort to be devoted to those that are retained Specific product related information is com- and pursued. municated. Broader corporate credentials that Winners want their customers and might suggest opportunities for a wider rela- prospects to do well. They think about them. tionship are not presented. They become absorbed in their problems Losers ‘hold back’. They only commit signi- and opportunities. They focus responses ficant effort when a prospect is ‘seriously upon the needs and priorities of their interested’. They describe their roles in terms prospects and structure their proposals around of ‘submitting bids’. Although they may claim the selection criteria likely to be used in pur- to be ‘winning business’ they devote the chase decisions. majority of their effort to losing potential When winners do respond it is with com- business as most of the proposals they send in mitment and clear objectives. They think are rejected. through the outcomes and relationship they

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 would like to achieve. From the moment an pendent or peer review, and debriefs are held 2 initial contact occurs they position themselves to learn from both successes and failures. 3 as a potential business partner. They hit the The results of the Winning Business Re- 4 ground running, and allocate sufficient search Programme (www.luton.ac.uk/cfc) 5 resources early on to build up an unassailable suggest the winners among the companies 6 lead. examined could do even better. The ‘super 7 Senior managers in the more successful bidders’ – the 4 per cent who win more than 8 companies participate in pitches. They are three out of four of the competitive races they 9 interested, understand the importance of enter – are only very effective at less than 10 business development activity and want to be half of the 18 critical success factors identified 1 involved. The visible and active support of by the ‘Winning Major Bids’ report (Kennedy 2 senior management can be decisive in close and O’Connor, 1997). There is enormous 3 contests. It demonstrates the importance opportunity for most businesses to signifi- 4222 attached to a particular order and/or potential cantly improve their performance. ‘Win rates’ 5 relationship. are directly related to how many of the iden- 6 Winners try to understand how buying tified key factors a company is good at. 7 decisions are made within a prospect’s organ- Many of the changes that may be required 8 ization. They identify influencers, opponents to increase bid win rates can be put in place 9 and allies. They consider the personalities relatively quickly and at a modest cost. 20 involved and remain sensitive to how buyer Guidance is also available in the form of ‘win- 1 concerns may change during the course of a ning business’ reports for particular industries 2 particular procurement. People like to work and professions (see www.ntwkfirm.com). 3 with individuals and organizations they feel These spell out the relevant critical success 4 comfortable with. Winners work hard to factors. They also contain best practice case 5 establish empathy, build trust, and match the studies and commentaries by industry ex- 6 culture of prospects. perts. A bespoke benchmarking service 7 Where possible, winners automate the accompanies the eight reports covering indi- 8 more mechanical aspects of proposal produc- vidual professions. 9 tion. Time freed up is used to tailor responses, Sales support tools can also be used. A 30222 differentiate offerings and build relationships. laptop-based solution reduced the sales cycle 1 Thus sales representatives could use a laptop- of one company by up to 50 per cent and 2 based tool for accessing presentational won the 1999 Award for Knowledge Manage- 3 information, assessing requirements, configur- ment. The original investment was returned 4 ing and pricing suggested solutions, and gen- within four months by just one order. The 5 erating proposal documentation (see www. knowledge management framework used 6 cotoco.com). (www.K-frame.com) won the 2000 eBusiness 7 At the end of the day the crucial differen- Innovations Award for Knowledge Manage- 8 tiator between winners and losers is that the ment and is used to communicate complex 9 winners want to win. Prospects are not ‘items and technical messages. 40 in their in-trays’ as is often the case with Processes and practices for winning busi- 1 losers. Winners are devastated when they ness should be regularly subjected to an 2 lose. Win or lose, they also regularly review independent review. Even though there is 3222 their processes, submit their practices to inde- enormous potential for improvement many

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors companies re-engineer just about every one make a mark. Differentiation or standing out of their processes except those for winning from other available alternatives is a major business. challenge for many sales, marketing and com- Business development teams generally – munication teams. and bid teams in particular – are frequently Many purchase decision makers suffer from overlooked when training budgets are allo- information overload. They are inundated cated. The report ‘Bidding for Business, the with claims from various suppliers, and often Skills Agenda’ (Kennedy, 1999) identifies find it difficult to discriminate between the the top twenty bidding skills and how they possibilities on offer. Too often they are con- can be obtained. A thirty-tool ‘Contract Bid fronted with similar options in different Manager’s Toolkit’ (Bartram, 1999) is also wrappings rather than genuine choices. When available. People can avoid being ‘losers’ by we strip away advertising claims we may find consciously setting out to become ‘winners’. that several suppliers offer essentially the same product. ‘Minimum differentiation’ sometimes seems the prevailing approach to Differentiating your marketing. communication Although customers demand greater responsiveness to their particular requirements, Survey participants define success at bidding in and they often have more options for innova- terms of winning orders at an acceptable price tion and scope for enterprise than any previ- (Kennedy and O’Connor, 1997). Differ- ous generation in history, many suppliers entiation and tailoring can enable a supplier to play it safe. They all target the largest market justify a premium price (Coulson-Thomas, segments and alternative sets of requirements 2002a). A differentiated offering may also are ignored. They also make similar assump- attract attention and stand out. People are tions. Thus all cars within each category and often distracted by events and confused by price bracket seem to have the same general conflicting messages. Individual communica- aerodynamic shape. tion that is not distinctive may fail to register. The potential exists to produce many more Smart communicators establish the extent goods and services that reflect our individual- to which services, skills and experiences are ity and particular requirements. For example, unique, special or distinctive. When colin relation to cars many people would happily leagues seek new business do their presenta- incur the penalties of greater wind resistance if tions and proposals stand out? What is being they could step into a more distinctive design. offered that people cannot get elsewhere? Visitors to motor museums encounter an enor- Does an organization have a compelling mous range of different early car models pro- reason for existing? Why should people want duced by a variety of small manufacturers. to join it or use its services? What would the Today’s boaters are quite willing to wait world lose or miss if it ceased to exist? Would between eighteen months and two years for a anyone notice or care? new narrowboat. Most of the steel shells are People’s interest in communication should hand built. Craft workers lovingly fit them out not be taken for granted. ‘Me-too’ organiza- according to the personal requirements and tions that imitate others often struggle to be individual designs of proud owners. People noticed, and they usually find it difficult to happily pay a premium for individuality.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Most businesses have the potential to be as others do, or it might have its own distinc- 2 unique and special. Yet, to take another exam- tive approach, tools or methodology. 3 ple, we are encouraged to buy standard soft- Interesting angles can create interest. An 4 ware packages. They give us the same organization’s terms of business might be 5 capabilities as everyone else when bespoke unusual or novel. How it operates, the basis 6 development might enable us to be different, upon which it charges for services, or the rela- 7 might provide competitive advantage and tionships it forges with clients could also be a 8 could create additional intellectual capital. source of differentiation. Perhaps it partners in 9 Losers follow the herd, play catch-up and a certain way or has a particular approach to 10 copy others. However, ‘me-too’ activities are sharing risk. 1 not the route to market leadership. Communi- There may be many potential differentia- 2 cators can help their employers and clients to tors and various combinations of them that 3 identify potential differentiators and thus could be adopted. But whatever approach is 4222 become more distinctive. For example, an used needs to be relevant to the particular 5 organization’s aspirations, intentions, vision, situation and appropriate for the circum- 6 goals or values might be unusual or interesting. stances in which a group finds itself. 7 A management team is not required to seek Differentiation is an attitude of mind. 8 the same ends as other groups. Nor should it Confident communicators probe prevailing 9 feel compelled to emulate their achieve- assumptions. Like winners, they ask challeng- 20 ments. People ought to be able to think for ing questions. Are new alternatives being cre- 1 themselves. They should consciously set out to ated? Is choice being extended? If the 2 do something different. organization stopped operating would cus- 3 An organization and/or its offerings might tomers simply buy similar offerings from 4 already have a distinctive image and reputa- other suppliers? What would be established to 5 6 tion. If not, the communicator should set fill the gap, and how would it differ from what 7 about trying to build one. There are many currently exists? 8 ways of making greater impact, from dress Losers often limit themselves. They become 9 and language through design and style to orig- imprisoned behind imaginary bars and fall 30222 inal ideas. Thought leaders tend to be associ- into traps of their own making. In order to 1 ated with particular ideas, views or concepts. stand out, make a mark and have an impact 2 People may be distinguished by their winners look beyond the norm. In many com- 3 appearances, backgrounds, competences, ex- panies more imaginative thinking is required 4 periences, special skills and viewpoints. to craft marketplace offerings for the unful- 5 Winners assess perceptions. They ask third filled and those who aspire to be different. 6 parties to tell them what stands out when they Collectively they may constitute distinct com- 7 meet colleagues, competitors and peers. Do munities that might support new enterprises. 8 they work, learn or otherwise behave in a Copying is often a self-imposed constraint. 9 noticeable and particular way? There are usually alternatives to bland con- 40 A company might be structured differently sensus, middle ways, and lowest common 1 from other firms. Maybe its products and ser- denominators. However, differentiation re- 2 vices are distinctive. Alternatively, it may offer quires a willingness to reflect, debate and 3222 more of the same. It may work and function challenge; a desire to innovate; and the urge

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors to discover. Effective communicators distin- Corporate cultures should encourage discus- guish fundamentals from fads, substance from sion; stimulate thought and inspired innova- surface and reality from illusion (Coulson- tion (Coulson-Thomas, 1999). Imaginative Thomas, 2001). entrepreneurs recognize diversity, explore Exercises exist for formulating new market- contradictions and foster individuality. place offerings and there are checklists for Winners generate distinctive options, create challenging the relative importance of action alternative models of operation and establish and reaction, complexity and simplicity, new markets. activity and reflection and change and con- Working and learning environments need tinuity (Coulson-Thomas, 2001). Shifting the to offer variety – perhaps peace and solitude balance between them can result in genuine for one task and interaction and stimula- alternatives. Not everyone has the same tion for the next. Communicators searching speed or time preferences. Given the chance, for a ‘big idea’ may need to forsake anaemic many customers would make different trade- offices, avoid the distraction of mobile phones offs from those that suppliers decide on their and seek out quiet areas where they can sit, behalf. dream, meditate and think. Winners are often sensitive souls and restless spirits who create distinctive offerings for particular groups. Because these are different Building strategic relationships they get noticed. ‘Viral marketing’ or ‘word of with customers mouse’ brings them to the attention of other people with similar passions and shared Having won a new customer the next chal- obsessions. lenge is to build a relationship that will result People with complementary aspirations in a flow of repeat orders and follow-on busi- can form model communities, share facilities ness. To do this requires effective customer and provide care and cover for each other. Just relationship and key account management, as individuals work with natural materials to another area that has been examined by a craft unique items that attract commissions team from the Centre for Competitiveness. from consumers who rebel against mass man- Researchers examined how people in 194 ufacture, so companies can offer alternatives companies set about ‘developing strategic to contemporary bandwagons. customers and key accounts’ (Hurcomb, Thinking through the implications of where 1998). They identified a variety of critical the great majority of people are headed success factors that distinguish ‘winners’, the allows entrepreneurs to identify opportuni- companies in the top quarter of achievement ties. For example, instead of adding to the that realize the benefits of strategic customer various ways of communicating with others an relationships, from the ‘losers’ in the bottom astute operator could provide intelligent quarter that do not. devices that screen, prioritize and respond to There is a general dissatisfaction with the many approaches sought after individuals performance. Less than one in six of the par- receive and structure and manage subsequent ticipants consider themselves ‘very effective’ relationships. at increasing profitability through strategic Creative companies attract characters and relationships, and fewer than one in seven are inspire rebels rather than reward conformists. happy with the way they develop them. Yet, a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 clear majority of the respondents believe the to recognize ‘buyer power’. Terms of business 2 proportion of their sales due to key accounts are used as a selling tool. If all else fails they 3 will increase beyond the current level of over will offer discounts to secure new business 4 two-thirds. (Coulson-Thomas, 2002a). Customers derive 5 The survey reveals a wide gulf between the few benefits from being upgraded to ‘key 6 attitudes, approaches and results of the win- account’ status. However, when they learn of 7 ners and losers. For example, winners con- their importance to a supplier they may 8 sider three times as many of the key processes demand price reductions. 9 identified by participants as ‘very important’, When it comes to locking out the competi- 10 and they are five times as likely to be intend- tion (and locking customers in) the contrast 1 ing to make use of emerging technologies between winners and losers is particularly 2 (Hurcomb, 1998). stark. The winners rank 11 out of 17 lock out 3 Losers tend to live for the moment. They factors while the losers do not rank any 4222 are driven by the prospect of immediate busi- (Hurcomb, 1998). Quite simply the bottom 5 ness. They apply the ‘key account’ label to quarter of companies examined do not 6 their most important current customers, and appear to be taking any steps to protect their 7 when they deal with them they focus upon key accounts. Not surprisingly, they fail to 8 their own requirements. In essence they seek realize strategic relationship benefits. 9 to use their customers to achieve short-term In contrast, winners look ahead. They take 20 internal targets. Key account relationships are a lifetime view of relationships and consider 1 also left to sales and marketing staff and future potential when categorizing accounts. 2 hence contact may be lost when particular They value their customers and are prepared 3 individuals change jobs or move on. to put themselves out for them. They are 4 Losers mouth generalizations about the open and build personal relationships. Their 5 importance of building closer relationships focus is upon customer requirements and 6 with customers. However, they do little in buyer expectations. They endeavour to under- 7 terms of concrete actions to make them stand their customers’ businesses, industries 8 happen. They avoid commitment, discourage and buying processes and look out for oppor- 9 tailored responses and shun integration. They tunities that might benefit them. 30222 fear that departing from a standard approach Winners encourage a broader range of con- 1 might cause process and systems problems, tacts at multiple levels between their own staff 2 while establishing electronic links might and those of key account customers. Hence 3 expose them to viruses and hackers. relationships can survive re-organizations and 4 Open book accounting is another ‘no go’ changes of staff. At the same time, senior 5 area. Information and knowledge is jealously managers are involved in important negotia- 6 guarded. Overall, losers are very reluctant to tions. 7 change corporate procedures to accommo- Winners are prepared to differentiate and 8 date bespoke approaches. Little effort is made depart from the norm in order to deliver 9 to categorize accounts or ‘do things differ- greater value and benefit their customers’ busi- 40 ently’ to help particular customers in view of nesses. They regard processes, systems and 1 the ‘hassle’ involved. procedures as a means to an end rather than 2 Losers use a range of traditional sales and as ends in themselves. They ignore traditional 3222 negotiation techniques to win orders that fail ‘hard sell’ and ‘win–lose’ sales techniques and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors endeavour to influence buying rather than These might include the thirty tools in the overtly sell. ‘The Contract Bid Manager’s Toolkit’ Rather than mouth generalizations, ‘win- (Bartram, 1999), the twenty skills profiled in ners’ concentrate upon specific and practical the ‘Bidding for Business, the Skills Agenda’ steps to build relationships. They are prepared (Kennedy, 1999) report and a suggested sys- to commit, to extend partnership to the terms tematic approach to key account management of business, and to integrate processes and (Hurcomb, 1998). systems. As a consequence of their attitudes Customer relationship managers and KAMs and approach winners realize the many bene- may require training, individually or as a fits of strategic customer relationships that group. Collaborative arrangements can sup- elude the losers. plement skills, experience and reference sites Overall, these findings reveal a wide spec- in areas of relative deficiency. Communicators trum of effectiveness and considerable poten- ought to be able to provide help and support tial for improvement. By their own admission, in the development of communication and even the winners could do much better relationship building skills. (Hurcomb, 1998). The allocation of existing customers and eligible prospects to individual KAMs should reflect the sectors in which they and the com- Improving key account pany and its partners have particular expertise management and distinctive strengths. Rules, arrangements and terms covering access to the staff of part- Turning to what needs to be done, in many ners and the use of their know-how for busi- companies key account managers (KAMs) ness development, customer support and have prime responsibility for customer rela- service delivery purposes may need to be tionship management and business develop- negotiated. ment through cross-selling and winning new Revenue and profitability targets for each accounts within the sectors for which they are sector and KAM should reflect corporate strat- responsible. A first step would be to review egy and priority objectives. Specific business their responsibilities in relation to those of development and marketing plans may be other staff in order to address any gaps, over- needed for particular sectors. Communicators laps and boundary issues. may wish to participate in the formulation of A profile of the competences and ‘role account development plans for existing key model’ behaviours required by an effective accounts, and account capture plans for KAM could be developed and agreed, and eligible target accounts. KAMs assessed against it to identify personal The Winning Business Research Programme and team development needs. Important next (see www.luton.ac.uk/cfc) has produced steps might be to define and agree a key reports on the critical success factors for win- account development process, a customer rela- ning business in particular business sectors tionship management process, and a process and various professions. KAMs could use these for winning business in competitive situations. to identify ‘best practice’ approaches. Specific It may be necessary to develop or acquire sector and cross-sector applications, offerings, the approaches, tools and techniques needed events and marketing materials may also need to cross-sell and win and retain accounts. to be developed.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Sales and business development teams are more willing to accept challenges and 2 should establish mechanisms for capturing, embrace new ways of working and learning. 3 sharing and learning from positive and nega- Winners adopt a partnership approach. They 4 tive experiences. Deficiencies should be are prepared to share visions and risks. They 5 addressed. For example, arrangements with strive for ‘win–win’ outcomes by agreeing to 6 potential non-national partners to support the mutually beneficial objectives, and they con- 7 winning of international accounts could be sciously endeavour to remain relevant and 8 negotiated. add value. 9 Each KAM should be responsible for priori- Winners are restless and eager to innovate 10 tizing new business opportunities and and try out new approaches. They are pre- 1 prospects, allocating and managing available pared to commit to continued and measured 2 business development resources, and achiev- improvements in whatever they supply or 3 ing account and sector business development provide. Savings achieved are shared between 4222 and profitability targets. The assignment of the parties concerned. 5 accounts to KAMs offers the customer a point Winners are also prepared to practise ‘open 6 of contact with someone who ought to have a book’ accounting and to share information 7 holistic insight into the totality of their and knowledge relating to the achievement of 8 requirements. common objectives. They recognize that dif- 9 ferences can and do arise. However, within 20 the partnering relationships they foster there 1 Partnering are simple and quick processes for handling 2 disputes at the lowest possible levels. 3 The growth of partnering, the spread of 4 e-commerce, and the desire for strategic 5 alliances are important issues for both busi- The international dimension 6 ness development teams (Hurcomb, 1998) 7 and the purchasing community (FitzGerald, The horizons of ambitious managers today 8 9 2000). There is therefore considerable scope embrace the globe. Deregulation, privatiza- 30222 for the sales and purchasing communities to tion and market forces have eroded trade bar- 1 work together for mutual benefit. However, riers. The end of the cold war has created new 2 winners and losers are adopting very different opportunities. 3 approaches to this opportunity. Work can follow daylight around the world 4 Losers are cautious and wary. They seek allowing twenty-four hour a day operation. 5 refuge in small print and are reluctant to Resources can be accessed and activity under- 6 open up. They avoid risks by not straying taken locally, regionally or at global level 7 beyond what they know. Companies that depending upon requirements and compara- 8 adopt legalistic and protective approaches are tive costs. Even sole traders use websites and 9 likely to end up as low-margin commodity email to make direct contact with foreign cus- 40 suppliers. Playing ‘win–lose’ games will tomers. 1 ensure that they lose. However, operating in the international 2 Winners are likely to earn higher returns. business environment also presents new 3222 They are more flexible and innovative. They challenges. There are commercial, legal and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors financial risks. There might still be obstacles cultural diversity. They seek opportunities for of distance, culture and time that commun- foreign travel, participate in overseas ex- icators and their colleagues may need to changes, swap jobs, and join international address. project groups, task-forces and teams. It is important to retain a sense of perspec- Companies like countries can have distinct tive. Business people around the world watch cultures. Communicators need to be sensitive the news on CNN. Global media is shaping to differences and similarities in national their attitudes and perceptions. But even MTV assumptions, attitudes and motivations. They has its regional offerings, and requirements should try to reconcile conflicting interests for products can vary greatly between while recognizing that particular local require- national markets. The significance of borders ments might create opportunities for bespoke will depend upon the nature of the activity offerings. being undertaken. Customer segments may or may not co- Successful international operators and incide with national borders. Experienced businesses that struggle to build foreign rela- international managers are intuitive. They tionships adopt very different approaches have cross-cultural awareness. They are able (Coulson-Thomas, 2002b). Losers tend to to handle diversity, run joint ventures and ‘continue as before’ with the addition of over- build relationships with overseas colleagues. seas names on circulation and distribution Mutual expectations need to be realistic and lists. Winners adapt their behaviour and prac- compatible. There may be practicalities to tices as appropriate. They are aware of what is address, such as whether the differing tech- happening abroad, open to new influences, nologies of the various parties will connect and receptive to alternative ideas. and work together. Some losers are overawed or disheartened Some individuals and organizations have by the claims of others. However, many so- little choice but to go global. The people who called international companies are essentially are likely to be interested in what they have to national enterprises that trade internationally. offer may be widely scattered. Losers stunt the People who travel a lot may hold onto their growth of their businesses by keeping oppor- stereotyped views or exaggerate their national tunities to themselves, trusting no one and characteristics. Living and working abroad can operating alone. Winners expand internation- reinforce existing prejudices. ally by forming relationships with comple- Winners recognize that appearances can mentary collaborators. be deceptive. Some make an effort to adjust Some managers have a distorted under- and adapt, while others do not. Attitudes, standing of overseas situations and naive approaches and perspectives distinguish inter- expectations of international initiatives. Com- nationally aware mangers. They are alert to municators need to be realistic and should developments in the global business environ- think through the implications of what they ment. are setting out to do. Winners anticipate True internationalization is much more than likely consequences, probable outcomes and an ability to speak foreign languages. Winners possible reactions. They are prepared to are open to alternative viewpoints, tolerant address potential problem areas. of national differences and actively support Losers often fail to recognize fundamental

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 national differences, and they may say one Communicating for change 2 thing and do another. For example, they 3 might use the rhetoric of diversity and then More demanding customers, competitive 4 insist upon common approaches. Some execu- markets and tough trading conditions may 5 tives talk about internationalization but make trigger reviews of corporate aspirations, 6 sure that all key positions are in the hands of approaches, capabilities, structures and oper- 7 nationals of the ‘home country’. ations. Change is generally assumed to be 8 Winners avoid the imposition of standard necessary, desirable and beneficial. The ‘man- 9 solutions that are inappropriate in particular agement of change’ has become a priority for 10 locations. Wherever possible, they tailor their many organizations. 1 approach to local circumstances and individ- During the recent downturn in economic 2 ual requirements. They communicate with fortunes many companies initiated a new 3 customers and prospects in ways and using wave of restructuring and redundancy. Des- 4222 languages that are acceptable to them. pite a decade of re-engineering, a succession 5 Diversity can be a spur to creativity. of management fads, heavy investments in 6 Successful companies recruit and develop a new technologies and the extensive use of 7 multinational cadre of managers. Oppor- external management consulting services 8 tunities go to those who are best qualified for many boards and management teams were 9 each role. Internationalization is not forced caught flat-footed. 20 down people’s throats. It occurs naturally and Communicators need to address the reality 1 problems are tackled as they arise. of the context in which they operate. Despite 2 Losers tend to sweep difficulties under the the rhetoric about flexibility, the ambitious 3 carpet or hope they will go away. Winners let claims made by corporate leaders and the 4 people network. They allow them to forge hype of their advisers, many companies strug- 5 6 whatever cross-border relationships will best gle to cope with adverse circumstances. 7 enable them to achieve their objectives. Because so many corporate change pro- 8 Losers also impose a single corporate cul- grammes have failed to produce greater 9 ture on employees, customers and suppliers resilience and responsiveness, sudden and 30222 regardless of differing local conditions and dramatic readjustments may be thought 1 unfavourable circumstances. Winners strive to necessary. 2 adjust their management style to match how Employees are laid off and contracts are 3 the people they wish to develop closer rela- cancelled. Recruitment, training and the 4 tionships with operate. placing of advertisements are frozen. People 5 People should be equipped to handle joint are expected to do more with less. As a conse- 6 ventures with overseas businesses before they quence they may feel jaded and insecure. 7 are set up. Time has to be devoted to making Many managers do not seem to have learned 8 them work. Because of the effort involved from previous experience of the consequences 9 winners select their prospects with care. They of severe cutbacks. 40 also learn both from their own mistakes and There might be various reasons for individ- 1 from their customers, suppliers and business ual and collective amnesia. People may be 2 partners. overloaded with initiatives, inundated with 3222 information, and confused by competing

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors claims. Many people work very hard and for The impacts of some change may not be long hours, but on peripheral activities. They immediately apparent. Their consequences do not focus upon the critical success factors might be delayed or hidden. For example, for managing change, competing and winning they might result in the loss of strategically (Coulson-Thomas, 2002b). important knowledge and understanding. If too much is changed at once people may There may be pressure to conform. For a var- lose a sense of identity, belonging, direction iety of reasons people may be reluctant to and purpose. Change can disorientate and speak up against change. Corporate media disrupt, and some individuals can only take so may not give them a voice. Only one side of much of it. Business leaders need to think an argument may be presented. carefully about how much change can be While enthusiasts may champion change, handled before negative consequences wipe determined opponents might endeavour to out any desired gains. Enough continuity undermine it. When the benefits of change should be provided for people not to feel are widely spread the advantaged may not threatened and insecure. even register them. Marginal beneficiaries In some companies change has been may lack the motivation to prevent blocking ubiquitous and indiscriminate. Managers action by those who are strongly disadvan- are assessed and rewarded according to the taged. People who are indifferent or ambiva- amount of change they bring about. Yet lent may simply ‘go with the flow’. change is rarely neutral and it is not always The Centre for Competitiveness has exam- beneficial. It can be unsettling and disruptive. ined the approaches and practices of both When mismanaged it can also be stressful and ‘winners’ who successfully manage change destructive. It can distract people who should and ‘losers’ who do not. The attitudes, behav- be focused upon other priorities. iours and priorities of the two groups are Communicators need to be sensitive to the fundamentally different (Coulson-Thomas, impacts of changes. Introducing them without 2002b). What is clear is that change helps or first assessing their consequences is risky and harms depending upon what is changed, how may prove very harmful. Altering a task at one it is changed and for what purpose. point in a process, or introducing a new activ- The findings are similar to those for win- ity, may cause problems for those operating ning business and building relationships elsewhere, either within the same process or with customers. Losers are indecisive and in a related or dependent one. An end-to-end oblivious to the needs of others. They are cau- perspective is required. tious, wary of commitments and fail to inspire Few changes affect everyone in the same or motivate. They are also reactive. They way. Some may benefit while others are dis- respond to events and often fail to anticipate advantaged. Those who are satisfied – and the requirement to change. When they do act they may include key employees and import- it is often in peripheral areas. They overlook ant customers – may favour a status quo, what is important. while frustrated colleagues and unhappy indi- Losers hoard information. They are reluc- viduals may prefer an alternative. Opinion tant to delegate and trust. Although driven by within a board, management team or work their own agendas they often end up playing group may be divided between those who are other people’s games. They adopt standard for or against particular changes. approaches and are rigid and inflexible. They

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 imitate and copy others rather than think for to find that certain options have been lost 2 themselves. because a selected course of action cannot be 3 Losers utter opinionated assertions and reversed. 4 make self-serving observations. They confuse Much depends upon the purposes of 5 activity with progress. They train by sheep change and the capacity to adapt of those 6 dipping. Individual needs are not addressed. involved and directly affected. Confident 7 Immediate priorities take precedence over communicators are not afraid to question the 8 longer-term aims. They are complacent, se- rationale for proposed changes. They ask 9 cretive and defensive. They try to do every- whether an impact analysis has been under- 10 thing themselves, and they resist new evi- taken of their likely implications. They also 1 dence and external ideas. advocate an adequate assessment of the 2 Losers are indifferently led and confuse potential consequences for employees, cus- 3 operational and strategic issues. People are tomers, suppliers, business partners and 4222 offered bland generalizations rather than a investors. 5 compelling vision. A combination of destruc- Winners tell those likely to be affected by 6 tive attitudes, mistaken approaches and them why changes are thought necessary. 7 wrong priorities locks losers into a negative People should only be expected to make 8 spiral of decline towards commodity product demanding changes for valid reasons. Pain 9 supplier status. and disruption should be justified rather than 20 Winners in the struggle to change, trans- rationalized. The visions and arguments 1 form and reinvent are very different. They offered by many boards are excessively 2 understand that goodwill can be steadily general and economical with the truth. 3 eroded by the imposition of a succession of Management action and communication 4 changes that are not justified and which support should be applied where they are 5 appear trivial. Thinking managers tread most likely to make a difference. Justifiable 6 warily. They avoid diversions, panaceas and changes could be those that focus upon the 7 single solutions. They only alter what needs to critical success factors for achieving key corp- 8 be changed to achieve the results they seek. orate objectives and delivering greater cus- 9 Winners appreciate that change can disrupt tomer and shareholder value. Winners have a 30222 valued relationships. They distinguish goals, longer-term and more strategic perspective. 1 values, objectives, policies and activities that They set out to enhance capabilities, deepen 2 need to be reviewed and revised from those relationships, develop additional options and 3 that should be continued. They also recognize remain relevant. 4 that some people ‘follow the herd’. Once a Winners are also confident, positive and 5 clear majority accepts a particular course of pro-active. They build and release individual 6 action the uncommitted may climb aboard talent. They explore, pioneer and discover. 7 the bandwagon. They encourage enterprise and innovation. 8 Some communicators instinctively favour They trust other people and share information 9 consensus to the extent of excluding minority and opportunities with them where this is 40 views. Yet the members of a majority may be likely to prove mutually beneficial. 1 naive or mistaken regarding their best long- Winners address the specific realities and 2 term interests. Also preferences and priorities practicalities of what they need to do to 3222 can change. Nothing is more frustrating than manage change and achieve their objectives.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors They inspire and motivate people. They pre- what is possible and become sought after and pare and equip them to achieve the changes trusted business partners. they are expected to bring about. They avoid Managers in the more successful com- wasted effort and concentrate upon the areas panies work with colleagues to foster winning of greatest opportunity. attitudes and behaviours. They strive to attain While open to ideas, winners select people, a balance between strategy and capability. business partners and opportunities with care. They also ensure all the pieces of the jigsaw They are persistent but pragmatic, and deter- puzzle required for successful transformation mined but adaptable in pursuit of their aims. and sustained competitiveness are in place They take calculated risks, experiment with (Coulson-Thomas, 2002b). new ways of operating, and create new know- Alert communicators look out for the tell- ledge, options and choices. tale signs of losing attitudes and approaches. Risks to relationships, standing and trust are Typical symptoms are self-contained and especially important. A growing business may incomplete change and transformation pro- need to build upon an existing reputation and grammes initiated with little conﬁdence of safeguard core values. Steps may need to be success and without the necessary capabilities taken to protect what is important and pre- for effective implementation. vent the compromise of cherished beliefs. Losers sometimes give themselves away by Communicators should know the anchor ducking questions and avoiding confronta- points of a business, the cement that holds its tion. They manage ‘communication’ rather people together. than achieve results. Communicators should Some companies incur a high and con- avoid being drawn into activities to sidetrack tinuing penalty for modest and transient critics, conceal disappointments or rationalize reductions in a cost base. Winners value failure. relationships. They try to protect rather than Successful change managers check that disrupt them. They empathize and invite feed- colleagues are clear about what they are back. They probe and debate, and listen and trying to achieve and are visibly committed to learn. They collaborate on the basis of open- agreed objectives. They make sure people ness and transparency with complementary both understand what they need to do and spirits who share their vision and values. are enabled to act. Barriers to change should The boards of companies that successfully be identiﬁed and tackled. manage change tend to avoid the distractions Directors and senior managers cannot of trappings. They endeavour to inspire, become directly involved in the many and enable and support growth, development and varied activities that more bespoke and imag- transformation. They aim to cut through inative responses to changing circumstances blather and hype in order to get down to the will demand. Different business units and fundamentals of what needs to be done. venture teams should be empowered and Winners prefer simple solutions and direct enabled to bring about whatever changes action. They regard review, renewal and trans- are required to enable them to achieve their formation as normal activities. They think objectives and deliver value to their cus- before they act, and ensure that existing and tomers. potential customers are not disadvantaged by At any stage of the change process new change. They push back the boundaries of areas of risk can arise as structures, processes

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 and systems are altered. Communicators will insecure. With little time to think many people 2 be particularly concerned with threats to do not see the wood for the trees. The various 3 image and reputation and to relationships and studies of the Centre for Competitiveness 4 trust. People should understand what is at reveal considerable differences in the com- 5 stake and be equipped to respond. Problems munication practices of successful and unsuc- 6 will arise. Their absence could indicate a lack cessful companies and the attitudes and 7 of ambition. Learning from them and re- behaviour of their communicators. These can 8 enforcing success helps to maintain progress. now be summarized. 9 Let us start with vulnerable companies, or 10 the losers, and practices that should trigger 1 Winning and losing approaches to alarm bells. Communication is largely top- 2 communication down and one-way. Communicators simply 3 pass on whatever messages their bosses wish 4222 Modern corporations are essentially networks to communicate. They do not question a brief, 5 of relationships based upon trust. When a rep- challenge assumptions or ask whether inform- 6 utation for fair dealing and accurate reporting ation they are handed is accurate or fair. 7 is compromised the consequences can be dra- Losers only communicate when they feel 8 matic. The experience of WorldCom illustrates they need to. They become preoccupied with 9 how quickly meltdown can occur. messages that they would like to put across. 20 Executives sometimes go to considerable Recipients are just targets. Smart communica- 1 lengths to conceal the true state of their com- tors in some floundering companies pride 2 panies’ affairs. Association with the perceived themselves on their ability to distract, exag- 3 misrepresentation of Enron’s ﬁnancial stand- gerate or keep a situation under wraps. They 4 ing sealed the fate of Arthur Andersen. A key avoid speaking to people directly and hide 5 question for regulators is whether such widely behind technology. Sanitized summaries are 6 reported cases are isolated instances of decep- posted on intranets. 7 tion or symptoms of a wider crisis in corporate The communication of struggling com- 8 communications. panies is often insipid and non-committal. 9 The foundations of effective communica- They give little away. Bad news is hidden 30222 tion are often in place. Many corporate value under the carpet. Slick packaging encourages 1 statements advocate openness, while profes- passive acceptance. Communicators mouth 2 sional codes of practice champion integrity. motherhoods and repeat slogans. Their work 3 Managers are expected to have ‘communica- is often of a high technical standard. But the 4 tion skills’. Substantial investments have been focus is upon form and style rather than rele- 5 made in communication technologies. Senior vance and impact. 6 executives recognize that a distinctive vision, Communicators in stagnant and dying 7 stretching goals and clear objectives can companies can be emotionally detached. 8 inspire, excite and energize people. They often display little personal commitment 9 However, in many companies there is a to corporate messages. Their communication 40 wide gap between management rhetoric and can be cold, clinical and bland. Many are 1 corporate reality (Coulson-Thomas, 2002b). sophists and cynics. Communication for them 2 People are drowning in irrelevant informa- is a game to be played. They may consider 3222 tion. They are overloaded, overworked and scoring points to be more important than

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors helping others to understand the reality of a ance of symbols and are visibly committed. situation. They understand that they and their col- In ailing companies corporate communica- leagues will be judged by their actions and tion is more likely to be a distinct activity their conduct. They endeavour to match undertaken by dedicated specialists. Com- words with deeds. municators do the chief executive’s bidding. In companies with prospects communica- They work mechanically and struggle to high- tion is an integral element of management. light what is different, special or unique It is built into work processes and the roles of about their employer. Not surprisingly they managers. Communicators think for them- fail to connect with key stakeholder groups selves. They question motivations, probe and they spend much of their time rationaliz- sources and assess likely implications. They ing failure. When rumours start and adverse take steps to ensure the veracity of corporate publicity occurs few are sympathetic. Those messages. They assume responsibility for who have been tricked or feel duped look the what they communicate. other way. Winners are able to explain with conviction Communicators in successful businesses are the essence of what they are about. Their more conﬁdent. They have less to hide and communication celebrates and sustains suc- they behave very differently. They share cess. They engender allegiance and foster information, knowledge and understanding relationships that can withstand market with people whose co-operation is needed to shocks and survive the traumas of economic achieve corporate aspirations. They engage in downturn. People trust them and will put two-way communication and they encourage, themselves out for them. welcome and respond to feedback. Effective relationships depend on open- Good communicators are not preoccupied ness, trust and respect. Lasting partnerships with themselves. They focus on the people are based upon a shared vision, common they would like to establish, build and sustain values and goals, and agreed objectives. relationships with. They try to understand, Winners consciously create arrangements empathize with and reﬂect their aspirations, that benefit all the parties involved. They hopes and fears. They make direct and per- celebrate, enjoy and sustain success. sonal contact. They feel. They may stumble Investors, employees, customers, suppliers over the words, but they demonstrate they and independent directors should never care. take corporate communication for granted. Communicators in winning companies The intelligence, standing and bravado of consciously build mutually beneficial rela- corporate leaders and their professional tionships. They forge long-term partnerships. advisers are no guarantee that the full story is They are both sensitive and flexible. They being told. People should be alert to telltale listen. They monitor reactions and are alert to signs of whether communication approaches changing requirements. Communication activ- and practices indicate likely failure or herald ities evolve, as changes are made to ensure future success. greater relevance. Many more communication professionals Effective communicators identify unmet need to engineer a revolution in their role. needs, analyse communication barriers and Hitherto they may have been charged with address problems. They recognize the import- passing on top-down and one-way messages

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 from business leaders to the people of organ- Outcomes sought must go beyond under- 2 izations. They must become involved as standing and include involvement, owner- 3 advisers, coaches and enablers in achieving ship, buy-in and more imaginative and 4 culture change and corporate transformation. entrepreneurial responses. 5 6 7 REFERENCES 8 9 Bartram, B. (ed.) (1999) The Contract Bid Manager’s pany: Manage Change, Compete and Win, London: 10 Toolkit, Bedford: Policy Publications. Kogan Page. Coulson-Thomas, C. (1999) Individuals and Enterprise: FitzGerald, P. (2000) Effective Purchasing: The Criti- 1 Creating Entrepreneurs for the New Millennium cal Success Factors, Bedford: Policy Publica- 2 through Personal Transformation, Dublin: Blackhall tions. 3 Publishing. Hurcomb, J. (1998) Developing Strategic Customers 4222 Coulson-Thomas, C. (2001) Shaping Things to Come: and Key Accounts: The Critical Success Factors, 5 Strategies for Creating Alternative Enterprises, Bedford, Policy Publications. 6 Dublin: Blackhall Publishing. Kennedy, C. (1999) Bidding for Business: The Skills Coulson-Thomas, C. (2002a) Pricing for Profit: The Agenda, Bedford: Policy Publications. 7 Critical Success Factors, Bedford: Policy Publica- Kennedy, C. and O’Connor, M. (1997) Winning Major 8 tions. Bids: The Critical Success Factors, Bedford: Policy 9 Coulson-Thomas, C. (2002b) Transforming the Com- Publications. 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Ying Fan and Wen-Ling Liu

As a country with sustained high economic growth since the 1980s, China has been dubbed ‘the world’s last and largest market’. This chapter presents the Chinese dimension of integrated communication through an overview of the advertising and PR industry with some of the latest statistical information, and through an examination of renaming global brands in different cultures. The authors also illustrate the beneﬁts and drawbacks of using promotional events and sponsorship as a new type of media activity for China, especially in the increasingly afﬂuent youth sector.

China is undoubtedly a large and important ment suffered restrictions after the commu- market with 1.3 billion consumers. The eco- nists founded the People’s Republic in 1949 nomic reform and open-door policy since and began to practise the Russian-style cen- 1979 has set off an unprecedented consumer trally planned economy. During the Cultural revolution, which has signiﬁcantly changed Revolution (1966–76), advertising virtually the living standards and lifestyle of millions disappeared being branded as ‘evil’ and of people. The phenomenal growth in the ‘deceptive’. It returned to business in 1978 market economy is mirrored by the dramatic when China started the economic reform and development in integrated communication in open-door policy. the country, particularly in the advertising The last decade of the twentieth century industry. A virtually non-existent sector until witnessed a dramatic growth in the sector the early 1980s, the advertising industry is with average annual growth rate of 39.8 per now the second largest in Asia after Japan and cent. The total advertising revenue increased employs more than half a million people. more than thirty-one times from 2.5 billion Contemporary advertising in China dates RMB to 79.5 billion RMB (US$ 10 billion) back to the 1920s. Since then, it has experi- between 1990 and 2001, putting China into enced many ups and downs. After the ﬁrst the top 10 largest markets for advertising ser- advertising boom in the 1930s, its develop- vices (see Table 12.1). By the end of 2001,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 there were 78,339 firms involved in the grammes, whilst only producing 2.02 million 2 industry, employing 640,000 people, includ- hours of programmes. The media sector has 3 ing 46,935 advertising agencies (60 per cent) been dominated by a few important players. 4 as compared with fewer than 10 agencies in For example, one leading TV channel CCTV 1 5 1976 and 6,000 people in 1980. Geographic- attracted 28 per cent of all advertising rev- 6 ally, the advertising industry is concentrated enue on TV. Similarly, Guangzhou Daily had an 7 on three centres: the capital Beijing, the 18 per cent share of all newspaper advertising 8 largest commercial city Shanghai, and income. Elle proved to be the most ‘sellable’ 9 Guangdong Province, which borders Hong magazine in China with 21 per cent of all 10 Kong and has the most dynamic economy. advertising revenue for magazines (China 1 The three areas account for 50.7 per cent of Daily, 06–11–2002). 2 all advertising revenue. Table 12.2 shows the In recent years the internet and mobile 3 top 12 largest advertisers by product category. phones have emerged as the new media with 4222 The top 10 advertisers by brand were all local great potential. By the end of 2002, China 5 companies whose expenditure accounted for became the largest mobile phone market in 6 7 per cent of the total advertising spend. the world with 206.6 million subscribers 7 (compared with only 10 million users in 8 India). Chinese mobile customers sent nearly 9 Types of media 80 billion text messages in 2002, a five-fold 20 increase over the previous year. During the 1 The four major advertising media are tele- 10-day period of the Chinese New Year holi- 2 vision, newspapers, radio and magazines day in 2003, 6 billion text messages and more 3 (Tables 12.3). In 1990 television accounted than 1 million multimedia messages were sent 4 for 17.7 per cent of the total expenditure, (China Daily, 02–11–2003). 5 ranking third after outdoor (39 per cent) and Production of TV programmes, develop- 6 newspapers (31 per cent) in advertising ment of cinemas and distribution of newspa- 7 spend. Since the 1980s, every type of media pers and magazines will become the most 8 in China (radio, television, newspapers, mag- profitable investment areas in China’s media 9 azines and other media) has increased in industry, according to ‘China Media 30222 number and expanded in scope. They have Investment Report 2002–03’ (China Daily, 1 become more segmented and diversified in 02–11–2003). In its third year of WTO mem- 2 content and style. For example, there were bership the government has loosened its con- 3 202 television stations in 1985; ten years later trol on foreign media entering the Chinese 4 the number had surged to over 1000, plus market, and will open up TV, book and news- 5 more than 1,200 cable stations. There are paper sectors to foreign investors. 6 now 2,895 television stations, 2,128 newspa- 7 pers and 723 radio stations that take advertis- 8 ing. Television is the most powerful medium, International firms and their 9 reaching more than 1.1 billion viewers (90 strategies 40 per cent of the population) and accounting for 1 around 40 per cent of advertising revenue in Entering China in the early 1980s, inter- 2 China. China’s TV stations in 2001 broadcast national advertising agencies have seen their 3222 an estimated 9.56 million hours of pro- market share increasing from 5–10 per cent in

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors the middle of the 1980s to 55.4 per cent in the country. The year 1985 witnessed several 2000. The primary motive of these multi- firsts in the PR industry: the first PR depart- national agencies in entering China was to ment set up in a pharmaceutical company, the provide a service to their international clients first PR company founded by the state news who were eager to tap the large consumer agency and the first PR degree programme. market there. But now they have also Since the 1980s the PR industry has grown attracted more accounts from Chinese domes- from zero into an established sector. By the tic companies. China has presented a great end of 2000, there were 150 PR organizations challenge to both international agencies and and more than 1,000 PR agencies employing their clients: a language based on ideograms, around 100,000 people, including 5,000 different cultural values with regional varia- qualified PR professionals. The total turnover tions, the huge divide between urban and reached 1 billion RMB in 1999 and was rural areas, remaining ideological restraints, to expected to reach 2 billion (240 million US name a few. In contrast to the notion that dollars) in 2001. The first international PR standardization is enough for low-income firm coming to China was Hill & Knowlton in markets like China, a recent survey of 873 1984, followed by Burson-Marsteller in 1985. international advertisers in China found that Now 15 international PR firms (including the most companies used the combination strat- top 10) are operating in China. International egy (Yin, 1999). Although the Chinese market PR firms have apparent strengths in strategic is still less affluent, it is a highly competitive planning, branding and crisis management, one that requires international advertisers to whilst Chinese PR firms are good at media recognize the cultural differences and to relations, event planning and exhibition adapt. However, studies on how advertising in design. Despite its short history, PR has played China should be adapted remain inconclusive. an important role in China. For example, in On the one hand, Chinese consumers have the aftermath of the Tiananmen massacre shown great responsiveness to advertisements in 1989, the Chinese government employed that emphasize concrete, functional and utili- an international PR firm to improve its image tarian product benefits rather than symbolic in the west. A more recent case is the use of themes. They will read even the fine details of PR to help China’s Olympic bid. product print advertisements. On the other Despite its rapid growth since the 1980s, hand, Chinese consumers are becoming the advertising industry still accounts for only increasingly sophisticated. Urban, young and 0.7 per cent of China’s GNP, as compared to affluent viewers prefer the advertisements 3–4 per cent in the United States. The indus- that are interesting, entertaining and that try is expected to continue to grow at double- communicate new lifestyles and western digit rate and China is predicted to become values. the second-largest market after the United States (but before Japan) by 2020. China is the world’s largest market with 1.3 billion PR industry consumers. More than 350 million people (the size of the European Union) are expected In 1980 PR practice first appeared in China in to become relatively affluent ‘middle class’ some foreign-funded enterprises in Shenzhen with an annual income above US$ 4,000 in and spread gradually from there to the rest of the near future. With the country’s entry into

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 12.1 Advertising industry turnover and Table 12.3 Advertising expenditure by medium, 2 growth 1997 3 4 Year Turnover Annual growth Turnover RMB bn (per cent) RMB bn 5 6 1990 2.5 25.1 Agency 19.4 7 1991 3.5 40.3 Television 11.4 1992 6.8 93.4 Newspaper 9.2 8 1993 13.4 97.6 Other 4.1 9 1994 20.0 49.4 Radio 1.1 10 1995 27.3 36.5 Magazine 0.5 1 1996 36.7 34.2 Source: A. C. Nielsen (China) Ltd 2 1997 46.2 25.9 3 1998 53.8 16.4 1999 62.2 15.7 4222 2000 71.3 14.6 5 2001 79.5 11.5 6 Average annual 7 growth (1990–2001) 31.8 8 Source: Economic Daily, 6.11.2002 9 20 1 2 Table 12.2 Advertising expenditure by product category, 2001 3 4 Rank Product RMB bn Annual growth Share in total (per cent) ad spending 5 (per cent) 6 7 1 Medicines 9.67 29 12.2 2 Food and drinks 9.0 30 11.3 8 3 Home appliances 6.59 –10.4 8.3 9 4 Property sales and lease 6.95 16.6 8.7 30222 5 Cosmetics and skin care 6.33 33.4 8.0 1 6 Alcoholic drinks 4.12 69.3 5.2 2 7 Health services 3.26 6.9 4.1 3 8 Fashion 2.43 14.5 3.1 9 Cars 2.29 –46.2 2.9 4 10 Medical instruments 1.87 –13.4 2.4 5 11 Tourism 1.58 22.6 2.0 6 12 Tobacco 0.91 5.9 1.1 7 Others 24.5 8.3 30.8 8 Total 79.5 11.5 100 9 40 Source: Economic Daily, 6.11.2002 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors the World Trade Organization and the 2008 encountered was the language. As the Chinese Olympic Games to be held in Beijing, there use characters based on ideograms and the will be a huge inﬂux of foreign goods and majority of people are unfamiliar with the capital investment into China as the market Roman alphabet, the international brand has becomes more open with many trade restric- to choose a proper Chinese name. This is a tions being removed. This will provide inter- complicated task that requires a thorough national advertising and PR ﬁrms with great understanding of Chinese culture as well as opportunities (see Tables 12.1, 12.2 and linguistic skills. Three methods are commonly 12.3). in use to translate a foreign name into Chinese:

Brand communication 1 Direct translation or transliteration. The Chinese equivalent sounds close to the Lux is called ‘Strong Man’ in China, a name original, but has no specific meaning. contradicting the image of a young lady on its 2 Free translation. The foreign name is trans- package. When the brand first entered the lated according to its meaning or meaning Chinese market in the early 1980s, a Holly- in Chinese, regardless of its original pro- wood actress was employed in one of the nunciation. earliest western TV commercials. While 3 Mixed translation. Both sound and mean- bathing herself in a large bathtub (certainly ing are considered. The pronunciation of an exotic scene to the Chinese viewers at the original name dictates the sound the time), she said in a soft seductive voice (phoneme/syllable) of the new name. The ‘I only use Strong Man. How about you?’ This meaning of the name is chosen after the proved to be a huge success and Lux became sound. a household name within weeks. In Taiwan Lux is called ‘Beauty’, a name that matches There are some cases when foreign brands are with the image of young lady. Both names are left untranslated either deliberately or due to pronounced with exactly the same sound difficulty in finding a suitable name. Typically and tone. In the end Lux has two different these brands have the following characteris- names with totally different images in the tics: short product names (M&M); or in the same language and culture. An explanation business sector (IBM); or have an upmarket can be found from the ideological differences image (Bang & Olufsen). existing in the two parts of China. While A recent study examined 100 international ‘Beauty’ would be an acceptable name in brands and their adopted Chinese names China today it was certainly a problem back (Fan, 2002). It found that the mixed method in the 1980s. Under the orthodox communist was mostly used (46 per cent), followed by doctrine, ‘beauty’ was related to the decadent free translations (29 per cent) and direct bourgeoisie aesthetics. translation (25 per cent). Direct translation maintains the phonetic link between the two The need to have a new name names, i.e. the new name sounds like or close to the original, but it has no specific meaning For many international companies entering in Chinese. Free translation, on the other the Chinese market, the first barrier they hand, gives a meaningful Chinese name but

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 loses the phonetic link with the original. The esting to note the use of folklore or idioms in 2 mixed method seems to be the most popular renaming car brands such as: BMW as a horse, 3 one among the three as it creates a new name Citroen as a dragon and Rover as a tiger. 4 in Chinese that both sounds like the original All these animals are powerful symbols in 5 and has a meaning. This result confirms that Chinese legend. The horse is related to speed, 6 the sound of the original name is the starting the dragon to power and the tiger to prestige. 7 point in the translation process, but the mean- It is also worthwhile to compare Coca-Cola 8 ing of the new name is a more important con- with Pepsi Cola. In their Chinese names 9 cern. Three-quarters of the sample used either ‘Palatable and enjoyable’1 and ‘Hundred 10 mixed or free translation. things enjoyable’, the last two characters are 1 the same. However, the difference in the first 2 two characters sets them apart. Coca-Cola’s 3 Factors affecting renaming name has a clear link with product benefits; 4222 the repetition of a character makes the name 5 Reflecting product benefits and brand posi- rhythmic which enhances the name recall. In 6 tioning are the two largest groups. It is inter- contrast, Pepsi’s name is a poorer imitation 7 8 Table 12.4 Factors influencing the new name 9 20 Factor Brand Name in Meaning Total 1 Chinese = 75 2 Reflecting product Nivea Girl keep elegance 18 3 benefits or industry Pampers Help baby fit 4 characters Ikea Good for home 5 Polaroid Shoot get instant 6 Quality/brand Saab Gentleman’s treasure 16 positioning Gucci Classic looks 7 Goodyear Strong, special unique 8 Lucky names Kellogg Home happy 13 9 Heineken Happy power 30222 Carrefour Family, happy fortune 1 Traditional values Ericsson Love build trust 5 2 Prudential Protect honest 3 Beliefs/customs Rover Land tiger 3 4 Linking to logo or Wrigley’s Arrow brand 4 5 packaging 6 Patriotism Aiwa Love China 3 7 Henkel China high 8 Country of origin L’Oreal European elegance 3 9 effect 40 Other Microsoft Tiny weak 6 1 Same or similar to Volkswagen The masses 4 2 the original meaning 3222 Source: Fan, 2002a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors without any distinctive feature. In all 100 Brand positioning is another important con- cases, Glaxo-Wellcome is the only long sideration. In the case of Canon, its new name name with five syllables. Despite its length, ‘Best calibre’ is strategically desirable: it sounds the name itself is unique and easy to remem- appealing and generates associations of qual- ber. For Glaxo the last character used in ity. The new name has the inherent ability to Chinese represents medicine names. The be recalled easily from memory and establish second part Wellcome is rendered as ‘keep a distinctive, quality brand positioning. healthy’, clearly describing the product bene- Renaming a brand in another language/cul- fits. Other examples are shown in Table 12.4 ture involves more than simple linguistic (p. 189). issues. Brand positioning is perhaps a more important consideration here. A good localized name like ‘Best calibre’ with ‘Built-in’ Balance between sound and image could add value to its original brand meaning equity and make brand communication in that market a relatively easier task. Chinese names place more emphasis on Brand renaming in a foreign culture is noto- meaning than sound. A meaningful name is riously difficult due to the complexity in lin- crucial in developing both a mental image guistic and cultural differences. It has to take and favourable associations. Mercedes Benz is into account various factors and weigh up any a good example. Its official name in the subtle differences between alternatives. People’s Republic of China is ‘Speed on’. The Examples in Table 12.5 demonstrate that a sound and visual image of two characters poorly conceived name could create confu- indicate a horse with associations of speed, sion in the consumer or harm the brand’s dynamism, performance and capability – the equity. Although no simple rule guarantees exact attributes that the brand symbolizes. the finding of a good name, an understanding

Table 12.5 Names with potentially negative connotations

Brand Name and meaning in Comment Chinese

Peugeot Too feminine, no link to product benefits Pretty Pizza Hut Sounds desperate, confusing Must win customers Dunhill Philistine, incompatible with the upmarket image Ascend happy road Compaq Cypress symbolizes the aged or old, incompatible with Healthy cypress a hi-tech image Microsoft Implies ‘tiny and weak’, contrary to its status of the world’s Tiny soft /weak largest firm Olivetti Who gains profit? What about customers? Good profit gained

Source: Fan, 2002a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 of the issues discussed here will help the com- companies deliberately gave their products 2 pany prevent the costly blunder of choosing a a brand name that sounds like a translated 3 wrong name. foreign name to benefit from the appeal of 4 foreignness. Some went even further by 5 simply adopting an English name; for exam- 6 The global–local paradox in brand ple, TCL is the leading consumer electronics 7 communication brand in China. The dilemma faced by the 8 international brand is not about whether to 9 Brand image refers to the perception of con- choose a suitable Chinese name (it is a neces- 10 sumers, a picture in the mind of the beholder. sity in the majority of cases), but whether 1 A brand’s name is the foundation of its image. to maintain a western image or to create a 2 Though global brands may exist, it remains a more localized image. For example, Nike and 3 question whether there is any global image Reebok have adopted very different brand 4222 as the perception of global brands is condi- image strategies. Nike maintains a standard- 5 tioned strongly by various factors at national ized ‘fitness and performance’ image in all of 6 level such as cultural and socio-economic the markets it serves. Nike is translated into 7 market environment (Ross, 1995). The trans- Chinese as a name that has no specific mean- 8 lation process gives an international brand ing (though its first character means ‘durable’) 9 not just a Chinese name, but also a distinc- but has a distinctive foreign or western image 20 tive local image. Take BMW as an example. To and sounds more appealing. Its rival Reebok, 1 millions of Chinese consumers, BMW is a on the other hand, customizes its image on 2 ‘treasure horse’ rather than ‘the ultimate the basis of national differences. It is rendered 3 driving machine’. A horse is generally per- as ‘dashing step’, a meaningful name but 4 ceived as a heroic creature in Chinese culture: without a foreign image. 5 there are dozens of idioms and legends From a broader perspective, the global 6 describing its feats and it is a popular subject brand–local image paradox is part of the 7 in traditional Chinese paintings. By adopting debate of globalization and adaptation (for 8 such a name, the brand can tap into the rich example, see Levitt, 1983; Quelch, and Hoff, 9 cultural deposits and create a favourable 1986). The challenge for international brand- 30222 mental image in the consumer’s mind. ing is to find a fine balance between the two 1 Although some research has found ample strategies, as there are risks at both extremes. 2 evidence that consumers in Europe and the A pure global image that is alien to the 3 United States increasingly favour national national culture will not appeal to local con- 4 brands over brands from other countries, the sumers. On the contrary, a totally localized 5 situation in China is different and more com- image will not benefit from brand assets of 6 plicated. On the one hand, Chinese consumers the original and find it hard to differentiate 7 prefer localized international brand names itself from the local competition. Unilever is a 8 that carry positive meaning as examples from good case in point. A global brand, according 9 this study showed; on the other hand, they to its chairman Michael Perry, is simply a local 40 also favour international brands over real brand reproduced many times (quoted in 1 local brands as the former are perceived to AdWeek, 14 December 1992). The company 2 have either better quality or higher status. has been for years actively pursuing localized 3222 No wonder hundreds of indigenous Chinese branding strategy in China, localizing all its

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors international brands and acquiring successful offers a vast potential in sponsoring such local brands. Most Chinese consumers proba- activities and events. bly have no idea about Unilever’s origin, it is Music is probably the most universal means perceived as a multinational company with a of communication nowadays, instantly tra- Chinese identity, namely ‘united benefit versing language and other cultural barriers. China’. The company launched its first local- Popular music reflects changes better and ized corporate identity programme in China in faster than any other genre. And it is usually April 2001. The new logo places the original reflective of what is happening in society Unilever logo against the shape of a house as a whole. Finding a way to link a message with the slogan on the top ‘Where there is a to popular music in order to reach a target home/family, there is Unilever’. This is in segment of Chinese consumers is what accordance with Chinese emphasis on family music event sponsorship is pursuing. Younger values (Fan, 2000) and provides an example people living in big cities consume popular of a well-balanced and integrated global– music through MTV and the Chinese MTV local image. channel called Channel V. They also listen to the radio, regularly attend music events and go to clubs and discos. In Shanghai there are a Emerging new media for variety of discos and clubs that are equipped integrating communication with the latest laser, light and sound systems and provide enough space for 2,000–3,000 Consumption is a relatively new experience people. Some discos specialize in hosting big for Chinese consumers, who began to enjoy music raves featuring famous DJs from the shorter working hours and more official holi- United States and Europe, attracting young days in recent years. With more spare time people who can be classified into what Wei and additional disposable income consumers (1997) called ‘Modern’ and ‘Generation Xers’ now demand a wider choice of products and lifestyle segments. These two segments are services, particularly in sports, leisure and characterized as being more affluent, better entertainment. This is in line with the experi- educated, hedonistic and pursuing a fancy ence of other southeast Asian countries where and distinct lifestyle. They become core target economic development drove growth in the groups for international companies in con- leisure industry. sumer goods and sports fashion markets. As the market becomes more competitive, The sponsorship of such events offers the it is crucial for international companies to find sponsor good opportunities to reach and com- a better way to cut through the competition municate directly to target audiences by and reach the target audience. Event sponsor- means of free samples, prize draws and ship provides companies with alternatives to information gathering, etc. For Chinese young the cluttered mass media, an ability to seg- people the latest techno rave, house and hip- ment on a local or regional basis and oppor- hop music events are a means of expressing tunities for reaching targeted lifestyle groups new lifestyles. At the same time such events whose consumption behaviour can be linked give them the opportunity to taste/experience with the sponsored events. On the other hand, new things (products, ideas, fashion and the huge growth in sports activities, music and lifestyle) portrayed through the music. Music art events, and other forms of entertainment raves reflect younger people’s contemporary

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 wants and attitudes, something that is highly This becomes particularly important to many 2 valued by a specific type of audience. Event foreign companies who find themselves facing 3 sponsors can develop positive effects in difficulties in identifying and reaching target 4 building favourable associations and links to segments. 5 the brand. For example, Carlsberg had co- How are international companies practising 6 operation with MTV in which they sponsored event sponsorship in China? What benefits 7 special programmes. In addition, Carlsberg and problems are they encountering during 8 organized special music event parties in the process? These are some of the questions 9 Shanghai. The sponsor benefits not only from investigated by Fan and Pfitzenmaier (2002) 10 the impact generated from the events them- in an internet-based survey with an online 1 selves, but from wider coverage in the local questionnaire. Forty-five companies were 2 media. selected from wide business sectors including 3 One of the most important benefits is that automobile, beverage, sport apparel, airline, 4222 events offer opportunities to establish direct bank, hotel and entertainment. The names 5 contact with opinion leaders and innovators. and email addresses of contact persons were 6 Chinese culture value systems place emphasis obtained mainly through personal contacts 7 on uncertainty avoidance and conformity and from a German agency’s website. All 8 (Fan, 2000). To a Chinese person, any un- the companies have their headquarters in 9 certainty, ambiguity and risky or undefined Europe or the United States and are currently 20 situation is viewed as threatening and must operating in the Chinese market. A total of 1 be avoided. The innovator takes over the thirteen completed, usable questionnaires 2 social and financial risk in trying for instance, were received, a net response rate of 29 per 3 new products/fashion or lifestyles. Other mem- cent. Among those responding were two 4 bers in the group make use of the reference of sports marketing firms, three companies in 5 the opinion leader/innovator. As a result per- brewing or wine trading businesses, one 6 ceived risk for other group members dimin- advertising agency, one estate agency and 7 ishes. They may also feel discomfort at being one TV channel. Geographically, twelve were 8 left behind in the new fashion and are easily from Shanghai (China’s largest industrial city) 9 seduced into following what the innovator has and one from Chengdu (capital of Sichuan 30222 tried. Innovators in this case become opinion Province). Due to the exploratory nature of 1 leaders who develop important links between the study and small sample, generalizations 2 members in the diffusion cycle of new prod- should be made with caution. However, the 3 ucts because they introduce the new product main findings from the survey are summa- 4 and lifestyle to early adopters, who go on to rized in the following tables. 5 influence a larger minority. From Table 12.6 it can be seen that tradi- 6 Group conformity is another important tional forms of media such as TV, print and (to 7 cultural variable among Chinese people and a less degree) billboards are still most used. 8 has a strong impact on consumer behaviour. However, a majority of respondents acknow- 9 The product/fashion or lifestyle must reflect ledge the importance of the internet as a new 40 the values and norms deemed as acceptable media. The highest concentration of promo- 1 by the group. In this regard, event sponsor- tion budget is on direct marketing, followed 2 ship plays a key role in forging links with opin- by sales promotion and point of sales. Long- 3222 ion leaders and in reaching target audiences. term brand-building tools seem to have a low

Rating 1 2 3 4 5 Replies Most Least used used

TV 51103 10 Radio 0 2 2 3 4 11 Internet 0 3 3 5 1 12 Print 5 3 2 1 2 13 Billboards 2 1 4 0 3 10

Source: Fan and Pﬁtzenmaier, 2002

Table 12.7 What kind of event(s) would you Table 12.9 How did you build an association or consider sponsoring or hosting? link between the sponsored event and your brand/company? T = 13 Per cent Replies Per cent Replies Music 46.2 6 (T = 13) Sports 64.5 8 Arts (theatre, galleries, dance) 46.2 6 Event signage 61.5 8 Company events, celebrations 46.2 6 Event title 30.8 4 New product or collection Ofﬁcial event sponsor 53.9 7 introduction 15.4 2 Company brand, logo, name on: Local culture/lifestyle events 46.2 6 1 Event poster 53.9 7 Education (schools, university, 2 Event ticket 46.2 6 grants) 30.8 4 3 Other print media 23.1 3 Others (specify) 7.7 1 Others 7.7 1

Source: Fan and Pﬁtzenmaier, 2002 Source: Fan and Pﬁtzenmaier, 2002

Table 12.8 What event(s) have you sponsored in the past three years?

Christmas parties Annual tournaments (basketball, tennis) New year parties Soccer games British embassy balls FA cup ﬁnal Opening of new British consulate Rugby Receptions of ambassadors Shanghai frisbee league Belgian business association event Ultimate frisbee American chamber of commerce event Hash house harriers Canadian business forum event Shanghai darts league cup TV shows, music concerts Company openings Theatre production Opening ceremonies of ofﬁcial institutions First Shanghai Asia music festival Release of new movies DJ swing in rojam (music) DKD DJ parties Local charities Jazz concert in Park97 First Shanghai international food festival Wine tasting Rave parties of various scales in east and south China Company events (e.g. Shanghai-Suzhou outing)

Source: Fan and Pﬁtzenmaier, 2002

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 12.10 How did you integrate the event marketing mix by combining it with other 2 sponsorship into your marketing mix tools from advertising and sales promotion 3 or campaign? (38.5 per cent) and packaging and PR (23.1 4 per cent). The ratio of the expenditure for Per cent Replies 5 (T = 13) event sponsorship and sponsorship-linked 6 promotion indicates that spending on the 7 Event logo integrated into latter is quite low. Only one company has a own ad campaign 8 (TV, print, etc.) 38.5 5 ratio of 1:2, five companies spending 1:1 and 9 Event logo or name on below. The two most important objectives in 10 product package 23.1 3 the sponsored events reported are enhancing 1 Competition and lucky brand awareness (88.9 per cent) and reinforc- 2 draw with event related ing brand image (55.6 per cent), followed by 3 involvement 38.5 5 brand positioning (44.4 per cent) and provid- Sales promotion 38.5 5 4222 Direct marketing 30.1 4 ing a platform to increase sales and market 5 Merchandising 38.5 5 share (44.4 per cent). Forging links with 6 PR 23.1 3 opinion leaders and strengthening corporate 7 Others 0 0 image through PR are also viewed as import- 8 ant objectives. Source: Fan and Pfitzenmaier, 2002 9 The unique business environment in China 20 creates some difficulties in achieving set 1 priority in the budget, as event sponsorship objectives according to some organizations 2 received a low percentage of the budget with (Table 12.11). They cite problems with 3 two exceptions. bureaucratic regulations and corruption. 4 Table 12.7 presents the most favourable One respondent highlighted differences in 5 events that the companies would consider to 6 sponsor or host. Sport is considered to be the Table 12.11 What difficulties have you experienced 7 number one (64.5 per cent). The next three in reaching the objectives? 8 have same ranking: music, arts and local cul- 9 ture events. This is confirmed by the listing of • Brand loyalty does not seem to depend on 30222 events that these companies have actually promotions. Chinese regard promotions as a 1 sponsored in the past three years. Table 12.8 chance to have something for free and it usually ends there 2 clearly shows the majority of events spon- • Competition, budgets 3 sored are sport or music related. • Government regulations 4 Table 12.9 reveals that event signage is • How to increase the real news value of the 5 regarded as the most important method sponsorship and make it interesting to media, 6 (61.5 per cent) for building the association trade and regular consumers • Being effective in reaching the consumer with the 7 and links between the sponsored event and least expense possible 8 the sponsor’s brand. Official event sponsor- • China itself in every way is difficult: corruption, 9 ship and company/brand logo on poster lying, cheating, empty contracts 40 come next (53.8 per cent). Event title spon- • For parties involved to abide by the agreed terms 1 sorship is considered less important (30.8 per • Target groups not clear 2 cent). A finding in Table 12.10 indicates that • Opinion leaders were not identified 3222 event sponsorship is integrated into the Source: Fan and Pfitzenmaier, 2002

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors perceptions among Chinese consumers of Table 12.13 What is your future strategy for event brand loyalty and promotion. When asked sponsorship? about whether the outcome of the objectives are measured or researched, the responses • Focus on small scale parties and events where your product is purchased but some free samples were divided with four saying ‘yes’ and five are given in support ‘no’. This shows there are difficulties in meas- • We will be involved in a minor way in the events uring and monitoring objective outcomes, a that allow us maximum exposure to the target problem not peculiar to China. market at a minimum cost The key factors facing companies when • Our key focus will be to enhance the brand image and create a distinctive brand identity among making decisions about event sponsorship are specific target consumers instead of boosting cost and efficiency (Table 12.12), followed by the brand awareness in general reach of target prospects. Respondents also • We want to reach the persons passionate about emphasize the importance of Chinese culture. sports through being active in sporting events. They acknowledge that promotional events Especially related to young people. Limited budget management should adapt to the local culture • Large parties, co-operation with multiple- sponsors • High quality ones which closely link to brand and language to give the brand a local identity. position Table 12.12, on the other hand, indicates that • Continue to focus on music and sports and to the majority of respondents clearly believe promote British culture that event sponsorship does give advantage, Source: Fan and Pfitzenmaier, 2002 compared to traditional advertising. Table 12.13 on future strategies for event sponsorship indicates that companies want to implications are another major concern. have a sharper focus on two objectives, When asked about the role that event spon- namely ‘maximum exposure to target audi- sorship plays in the integrated marketing com- ence’ and ‘to enhance image and create dis- munication mix (Table 12.14), respondents tinct brand identity. Cost control and budget were divided in their opinions. Seven organizations replied that event sponsorship plays a minor role at this point. Six claim that it has Table 12.12 Does event sponsorship offer you an already played an important role and would advantage in the following factors compared to traditional advertising? become even more important in future. In the words of one respondent, event sponsorship is Yes % No % a critical part of promotional programmes in Adapt to Chinese culture/ the marketing mix. It is seamlessly combined language 38.5 30.8 with sales promotions and always ‘PR-ed’ in a ‘Buy into’ (create brand associations well-branded manner to enhance brand related to) Chinese popular image/positioning. culture and lifestyle 53.8 15.4 There seems to be an agreement that event Give the brand a local identity and fit 53.8 15.4 promotion has a potential for growth (Table Reach target prospects and get 12.15). Though events management is re- into direct contact with them 53.8 15.4 garded as still being in its infancy, there is no Cost advantage and efficiency of doubt that ‘all major marketers will pay more communication tools 53.8 15.4 attention to below-the-line programmes’. The Source: Fan and Pfitzenmaier, 2002 importance of establishing direct contact with

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 12.14 What role does event sponsorship Table 12.15 Comments on the future development 2 play in your integrated marketing mix? of event marketing in China 3 4 • At this point a minor one • Direct contact with consumers is becoming • To remind the community of our presence, to increasingly important in the China market. 5 develop potential contacts and to support activities All the major marketers will pay much more 6 that we believe in attention to below-the-line programmes instead 7 • More and more important of above-the-line advertising. Event marketing will 8 • In fact, event sponsorship is a critical part of play a key role to build contacts 9 promotional programmes in our marketing mix. • Event marketing is just at the infant stage with a 10 It is seamlessly combined with sales promotions great deal of growth to be had and always PRed in a well-branded manner to • Growing but painfully, no big events to come off 1 enhance brand image/positioning yet 2 • Event sponsorship has been the major way to • Event marketing is considered to be a good 3 market our name and product marketing tool, yet any blind following without 4222 • Important, but one has to bear the costs in mind right strategy is dangerous. Measurement of the efficiency is needed 5 Source: Fan and Pfitzenmaier, 2002 6 • It should increase in usage • The above questions are all relevant to a company 7 that sells products or services in China. We are 8 consumers will play a key role as will the the largest sports marketing company in the 9 impact of local environment on any PR activi- world including China. We do very little above- 20 ties. For example, Marlboro’s much-publi- the-line promotion of our company 1 cized promotion campaign in 1998 was cut • Sports and music as a means to bring people 2 short after strong criticism from the press. In together • One must consider the socio-political context in 1999 the company was forced to give up the 3 China (marketing mix) and the feasibility of using 4 title sponsorship of China’s premiere football event sponsorship does depend on the product of 5 league after the government tightened up the company in question (i.e. there are restrictions 6 legislation on tobacco and alcohol advertising. for tobacco companies, etc.) International companies in China today are 7 Source: Fan and Pfitzenmaier, 2002 8 facing stiff competition not just from other 9 foreign firms but also local brands which may 30222 have moderate or even matching quality but ering PR intelligence and encouraging product 1 sell at far lower prices. They also find it more trials. 2 difficult to reach increasingly sophisticated The threat of growing competition from 3 markets. Communication through traditional foreign multinational corporations combined 4 mass media such as TV and press becomes with knowledge and identification of cultur- 5 more expensive and less effective. Events ally related differences are of critical concern. 6 management, though still at an early stage, Cultural change, combined with an increased 7 can provide companies with a good alterna- desire for material goods, is stimulated partly 8 tive, if used in co-ordination with PR and by new integrated communication, including 9 other principal elements in the integrated strategic advertising (Costa, 1991; McCracken, 40 marketing mix. The sponsorship of popular 1988) but might recognize that people are 1 sports, music and local cultural events would committed to their own culture’s value sys- 2 appear to be particularly effective in forging tems, attitudes, beliefs, and this in turn influ- 3222 direct contact with the opinion leaders, gath- ences people’s perception processes.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors For example, young Chinese adults aged Table 12.16 Advertisement by branded product between 18 and 24 years, in common with information other demographic groups worldwide, are highly driven achievement-oriented individ- China UK uals. Individualism in the fast-growing Asian Cosmetics, sanitation and markets is manifested by an eager embrace hygiene products M of new freedoms and western values. These Advertisements for medicine, young adults show strong drive and ambi- nutrition and health M tion and tend to be free-spending and self- Advertisements for consumer indulgent. They have a carefree attitude, a electrical appliances, short-term focus, a marked self-centredness, e.g. fridge, microwave, etc. O O with strong drives towards materialism. Advertisements for household The desire for different types of branded appliances, e.g. detergent, goods and company information (Table shampoo, soap, etc. M 12.16) shows in advertisements to improve Advertisements for daily living standards and lifestyles in China, necessities like watches, glasses, bikes, etc. O O through demand for cars, fashion, computers, books, education, home interior and enter- Advertisements for carpets, tainment information. Electrical appliances furniture and other interior decoration M such as fridges, microwaves, etc. are no longer the most popular items in China. Nevertheless, Advertisements for food and drink M young UK adults also require more information on audiovisual equipment, entertain- Advertisements for cars and motorcycles M ment, fashion. In particular, they ask for more medicine and health information. As housing Advertisements for computers, photocopiers and other office plans in China’s major cities have increased, products M Chinese young adults appear to demand more interior design information, while young Advertisements for books, magazines, schools and UK adults show less or no interest in it. Table education, etc. M 12.16 compares requirements for more prod- Advertisements for audiovisual uct information from the two countries. equipment, eg. hi-fi, Walkman, Thus, general information about advertis- TV, VCR, etc. M ing exposure in the United Kingdom and Advertisements for fashion China combined with semantic issues relat- information, e.g. clothing, ing to language and culture, has provided shoes, jewellery, etc. O O important branding information based on Advertisements for entertainment the viewpoints of UK compared to Chinese like music, movie, travel, peoples, especially young Chinese adults. cameras, etc. OO Such PR intelligence will inevitably expand in Source: Wen-Ling Liu (2003) the current economic climate to inform multi- Notes: M indicates that the country demands more product nationals, Chinese organizations and consult- information, p < .001. O indicates that both countries have no ants alike, on how best to communicate with significant differences, p > .05. this large and important global sector.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 NOTE 2 3 1 The Chinese names of international brands in the as a brand name; and (2) Chinese characters 4 study have been reverse-translated into English used in these names may have various interpre- 5 literally. The translation may appear odd in tations in meaning. 6 English because (1) they are coined in such a way 7 8 9 10 REFERENCES 1 2 Fan, Y. (2000) ‘A Classiciﬁcation of Chinese culture’, Wang, J. (1997) ‘From four hundred million to more 3 Cross Cultural Management: An International than one billion consumers: a brief history of the 4222 Journal, 7:2, 3–10. foreign advertising industry in China’, Inter- 5 Fan, Y. (2002a) ‘The National image of global brands’, national Journal of Advertising, 16:4, 241–260. 6 Journal of Brand Management, 9:3, 180–192. Wei, R. (1997) ‘Emerging lifestyles in China and con- Fan, Y. (2002b) ‘Globalbrand.com: standardised or sequences for perception of advertising, buying 7 localised communications?’ Academy of Market- behaviour and consumption preferences’, 8 ing Conference, Nottingham. International Journal of Advertising, 16:4, 261–276 9 Fan, Y. and Pﬁtzenmaier, N. (2002) ‘Event sponsorship Wu, X. (2002) ‘Doing PR in China: a 2001 version – 20 in China’, Corporate Communication: An Inter- concepts, practices and some misperceptions’, 1 national Journal, 7:2, 110–116. Public Relation Quarterly, Summer, 10–18. 2 Levitt, T. (1983) ‘The globalization of markets’, Yin, J. (1999) ‘International advertising strategies in Harvard Business Review, May-June, 61:3, 92–102 China: a worldwide survey of foreign advertis- 3 Quelch, J. A. and Hoff, E. J. (1986) ‘Customizing ers’, Journal of Advertising Research, 39:6. 4 global marketing’, Harvard Business Review, 64:3, ACNielsen, www.acnielsen.com.cn 5 59–68. China Daily, www1.chinadaily.com.cn 6 Roth, M. S. (1995) ‘Effects of global market conditions China PR, www.chinapr.com.cn 7 on brand image customisation and brand Economic Daily, www.economicdaily.com.cn 8 performance’, Journal of Advertising, 24:4, 55–75. Unilever, www.unilever.com.cn Usunier, Jean-Claude. (2000) Marketing across 9 Cultures, 3rd edn, London: FT Prentice Hall. 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Michael B. Goodman

This chapter looks at a variety of management functions in relation to an organization’s communication strategies for both internal and external stakeholders. It recognizes that technologies such as the internet underscore the global character of communication and that corporate communication has become a strategic tool for a corporation to gain competitive advantage. The chapter explores current trends in corporate communication and a variety of other important issues such as the role of business and communication; tools for communication practitioners; the building of relationships; and communication during change management.

Corporate communication (Goodman, 1994 Technologies such as the internet under- and 1998) is the term used to describe a variety score the global character of communication. of management functions related to an organ- In practice, corporate communication is ization’s internal and external communications. a strategic tool for the corporation to gain a Depending on the organization, corporate com- competitive advantage. Corporations use it to munication can include such traditional disci- lead, motivate, persuade, and inform em- plines as: public relations, investor relations, ployees – and the public as well. Under- employee relations, community relations, standing corporate communication provides media relations, labour relations, government the vision a company requires in an informa- relations, technical communication, training tion-driven economy for strategic planning. and employee development, marketing com- Corporate communication is more art than munication, management communication. science. Its intellectual foundations began Many organizations also include philanthropic with the Greeks and Romans – with rhetoric. activity, crisis and emergency communication, Its body of knowledge is interdisciplinary, and advertising as part of corporate communi- drawing on the methods and findings of: cation functions. anthropology; communication; language and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 linguistics; management and marketing; soci- munication. The CCI surveyed corporate 2 ology; psychology. communication executives from Fortune 1000 3 companies and asked eighteen questions. 4 Several of these focused on the functions of 5 Strategic importance of corporate their work and the budget responsibilities for 6 communication those functions. Other questions were asked 7 about the executives themselves – age, educa- 8 Communication has become vital to business tional background, gender, salary. The CCI 9 growth since our economy has ﬁrmly based also conducted phone and email interviews 10 itself on information, rather than manufactur- with selected respondents. 1 ing. Customers, employees, investors, suppli- The Council of Public Relations Firms com- 2 ers, and the general public now expect a high missioned the CCI to conduct a study of the 3 level of communication and candour from the relationship between spending on corporate 4222 companies that operate in their community. communication functions and its reputation as 5 Even in an environment that extols the reported by Fortune in its annual ranking of 6 virtues of decentralization to meet customers’ the ‘Most Admired’. These studies have impli- needs quickly, the value of a central manage- 7 cations for corporate communication practi- ment structure for communication makes 8 tioners: 9 sense for many organizations, particularly 20 ones with global operations. A central group • Relationships with your community matter 1 responsible for communication develops, pro- a great deal. The CPRF Study indicated a 2 jects, and maintains the corporation’s image positive, statistical relationship between 3 and culture. A communication group within what a corporation spends on its ‘found- 4 an organization sets policy and guidelines to ation activities’ and its reputation ranking. 5 meet the strategic goal of developing and per- • Culture is vital to organizational health. 6 petuating a corporate image and culture, to 7 project consistent messages, and to communi- Intangibles such as the culture of the 8 cate with its various publics on a routine basis, organization form an inviting environ- 9 as well as in emergency and crisis situations. ment that can attract and retain quality 30222 people; or create one that encourages 1 people to be less productive or to leave. A 2 Current trends in corporate positive culture has become a standard for 3 communication global corporations, such as: American 4 Express, Boeing, General Electric, IBM, 5 Data from the Corporate Communication SONY, Johnson & Johnson. 6 Institute’s (CCI) Benchmark Study conducted • Communication is strategic – now more than 7 November 1999 to March 2000, and the ever. Many company executives consider 8 Council of Public Relations Firms (CPRF) communication as purely tactical in both 9 Spending Study conducted February 2000 to its nature and its execution. In an inform- 40 April 2000 points to the trends in corporate ation driven age, communication is an 1 communication. The Corporate Communica- integral part of the corporate strategy. 2 tion Institute conducted a study to set a Strategic issues include an orientation of 3222 benchmark for the practice of corporate com- communication to an organization’s pri-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors orities, as well as toward the external newspapers to broadcast to the internet, environment. Integrity and credibility are relationships with the media are no longer the pillars of strategic communication. a matter of contacting a few old friends Realistic measurement systems and over a leisurely lunch. Each channel, each processes for improvement are strategic reporter, demands a professional relation- tools for success. ship built on credibility. • The age gap between managers and • The internet is just a tool; the internet is a employees must factor into communication strategy – truth is on the continuum. Any planning. Sixty-eight per cent of corporate anthropologist will tell you that a new executives in charge of public affairs and tool in a human system changes that employee communication (internal and system. So the internet has changed dra- external) – a large majority – are between matically the way people in corporations 40 and 55 years of age. The workforce communicate internally and externally. It they manage is overwhelmingly younger. has at once created a sense of liberation, A ‘generation gap’ exists, but can be and also represents a constantly present mitigated by applying the basic com- taskmaster. munication process, by conducting an • Speed is faster that it ever was. Experts com- audience analysis, and by focusing on pare an internet year to a ‘dog’ year. Is it the concerns of the workforce and the any wonder that people seem much older generation. than their years? The speed of life has us • People in the workforce care more about live several lives in one lifetime. themselves than the company. Members of • Every company will have a crisis; prepare for the contemporary workforce have been it. Crisis planning is informed by the Boy told since high school, and by parents and Scout motto: ‘Be prepared’. The Boy elders, that corporate life is not forever Scouts, however, did not conceive that and no job has a guarantee. Is it any their court victory (a decision allowing the surprise they practise enlightened self- organization to bar gays from its ranks) interest? How can a company expect em- could have resulted in a crisis of their own ployee loyalty in such an environment? – donations from corporations drying up • A company is expected to be a good corpor- and communities barring their use of ate citizen, as well as to make money. public facilities. Be prepared, indeed. In the wake of diminished power among • Writing is still the core skill for corporate almost all power structures in our society communication. The internet has under- – religion, government, the family – corp- scored that writing of the highest order is orations have by default taken on a still the major talent required of those greater role in solving many of the ills of who create and send the messages in and society. Social problems – substance from our major corporations. abuse, sexual harassment, child care, elder care – have fallen to the corpora- Some of the ﬁndings of our research indicate tions by default. some changes in how we communicate at • Media relations is more complex – no more work. Others indicate changes in relationships old boy system. In a 24/7/365 environ- between you and your workforce, as well as ment with scores of media outlets from changes between you and the community

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 your company is in. This brings us to our next tions such as annual report, crisis, employee 2 question. relations, internet, intranet, media relations, 3 policy, strategy, and public relations. Some of 4 The role of business and the results are shown in Table 13.1. 5 communication These figures (Table 13.1) indicate the sub- 6 stantial involvement of corporate communica- 7 Communication is a constant corporate function executives in communication actions 8 tion and that role has changed. It is more central to corporate growth and survival. The 9 complex, strategic and vital to the health of an responses also indicate substantial budgetary 10 organization than it was yesterday, and will responsibility for traditional communication 1 only gain in importance in an information functions and a shared or matrix role in forg- 2 driven economy. It is tied to the messages ing important corporate relationships with 3 created for all audiences – internal and exter- customers, vendors and investors. 4222 nal, paying and non-paying. And just how big are the corporate com- 5 What are the functions of corporate communication budgets of the Fortune 1000? 6 munication? The CCI Benchmark Study asked According to the benchmark study: 7 whether or not corporate communication 8 executives’ responsibilities and budgets Up to $500,000: 19.1 per cent 9 included twenty-four communication func- Up to $1,000,000: 14.0 per cent 20 Up to $5,000,000: 27.2 per cent 1 Table 13.1 Corporate communication functions Up to $7,500,000: 14.7 per cent 2 Up to $10,000,000: 4.4 per cent Function Responsibility Budget 3 (%) (%) Over $10,000,000: 20.6 per cent 4 5 Communication strategy 95.6 N/A The Council on Public Relations Firms Spend- Media relations 93.4 88.3 6 Public relations 93.4 80.3 ing Study asked more detailed questions 7 Executive speeches 90.5 86.1 about spending in the Fortune 500. The 8 Crisis and emergency 89.8 77.4 Spending Study found the following. 9 Communication policy 86.9 N/A The ‘typical’ corporate communication 30222 Annual report 79.6 69.3 department in the study had a budget of $7.5 1 Corporate identity 75.2 67.9 million and a staff of ten professionals and Internet communication 73.7 59.1 2 Intranet communication 72.3 58.4 three support staff. It was headed by a VP 3 Community relations 66.4 56.9 (often a senior or executive VP) who reported 4 Issues management 58.4 48.2 to the chief executive or chief operating offi- 5 Advertising 56.2 42.3 cer, and expects next year’s budget and 6 Marketing communication 52.6 26.3 staffing will both increase. Corporate culture 48.9 39.4 7 Corporate philanthropy 46.7 41.6 The range of spending on corporate com- 8 Employee relations 43.8 82.5 munication was very large: $285,000 to $100 9 Mission statement 38.0 29.9 million. The mean was $21.6 million. 40 Investor relations 27.0 19.7 Among those companies whose budgets 1 Government relations 21.9 19.7 included them, the following were the largest 2 Ethics code 8.8 N/A line items: Labour relations 3.6 1.5 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors • corporate advertising ($11.4 million); For companies operating globally, a strong • foundation funding ($8.1 million); corporate communication philosophy can • social responsibility ($4.65 million, offer the foundation for a code of ethics that including community relations, non-foun- applies throughout the world. Most corpora- dation funding, etc.); tions have an ethics code with a section on • government relations ($4.2 million); international business ethics. • employee communication ($2.6 million); The written mission statement defines the • investor relations ($2.1 million). corporation, its goals and operating principles, and its values and beliefs. The first of These figures underscore that playing the these three parts is clear and brief. The pre- communication game at the Fortune 500 level sentation of goals and operating principles requires substantial resources in professional calls for more detail. The expression of a com- staff and financial commitment. pany’s values and beliefs is difficult because people associate values and beliefs with philosophical or religious activities, not commercial Importance of a corporate ones. These statements cover a company’s communication philosophy commitment to:

Corporate mission statements and company • quality and excellence; philosophies are the products of executives • customer satisfaction; who recognize the strategic value of a clear • stockholder return on investment; statement of what the corporation stands for, • proﬁts and growth; its goals, and its practices. Clear understand- • employee relations; ing and articulation of the company mission is • competition and competitiveness; the cornerstone for building an image in the • relations with vendors; minds of employees and the public. • ethical behaviour; Organizations committed to communicat- • community relations and corporate ing with employees and the community have citizenship; a deﬁnite communication philosophy. Com- • diversity in the workplace; panies may refer to it as their communication • preservation of the environment and policy, or their mission statement. The phil- resources. osophy may be articulated through statements of commitment to employees, customers A corporate code of conduct, ethics policy and other stakeholders. The written statement guidelines, or handbook of business practice of corporate commitment to goals and expands the company mission statement. The values is often the external manifestation of written code acts as an implementation guide, the communication philosophy. It is not nec- and may include: essary for a written statement to exist to have a philosophy, but if the written statement • policy regarding general business con- does not represent corporate behaviour and duct; disclosure; compliance; values, its hollowness will be apparent to • workings of the corporate business ethics everyone. committee; • compliance with laws:

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 – securities – insider information; finan- corporate citizenship is the acceptance of the 2 cial inquiries corporation’s role as a responsible and signifi- 3 – disclosure of company information cant member of the community it is in. 4 – political contributions Add to this the changes in the nature of 5 – relations with government officials stockholders since the 1987 crash from indi- 6 (domestic and foreign) viduals, to institutions such as the enormous 7 – commercial bribery – kickbacks, gifts pension funds of TIAA and the states of 8 – record keeping New York and California, and the concept of 9 – anti-trust – Sherman and Clayton Acts responsibility meets the profit motive in a 10 – mergers and acquisitions partnership that works for Levi’s, L. L. Bean, 1 – international operations. Microsoft, and other successful companies. 2 • bidding, negotiation and performance of The message also came from over a decade of 3 government contracts; financially conservative government funds for 4222 • conflict of interest; social programmes which were prime candi- 5 • equal opportunity; dates in the slashing of public budgets. So if 6 • working conditions; government was out of the business of solving 7 • the environment. social problems, who would? Members of 8 the community. They have increasingly come 9 to include organizations and businesses. No 20 Ethics and corporate citizenship longer was it sufficient for a business to only 1 pay taxes and stay out of the affairs of the 2 Professional organizations and societies, such community. 3 as the Public Relations Society of America Corporations who defined themselves as 4 (PRSA), also issue standards of ethical practice good corporate citizens overwhelmingly link 5 for their members, and for the profession or their giving programmes to their business 6 industry as a whole. The American consumer goals. Such corporate citizens supported 7 has become highly sceptical of business prac- education programmes, recycling and other 8 tices and intolerant of companies that operate environmental support programmes. Good 9 unethically. Maintaining the highest standards corporate citizens measure and report their 30222 for propriety and ethical behaviour is the best corporate efforts by: 1 approach to developing a reputation for hon- 2 esty and integrity. • mentioning the activities in their annual 3 Over a quarter century ago in The New York report; 4 Times Milton Friedman called corporate giving • publishing a ‘public interest’ report; 5 the equivalent of theft, ‘spending someone • featuring the activities in the company 6 else’s money’ to solve social problems that are newsletter; 7 the province of government. He defined a • issuing press releases; 8 manager’s moral mandate to ‘make as much • linking their citizenship actions to adver- 9 money for the stockholders as they can within tising and marketing themes. 40 the limits of the law and ethical custom’. A 1 new generation of managers views Friedman’s Companies that have a long-term commit- 2 position as out of step with corporate citizen- ment to social responsibility are rewarded with 3222 ship. (Goodman, 1994, 1998) Put simply, greater name recognition, more productive

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors employees, lower R&D costs, fewer regulatory web pages, magazine articles, newsletters – hurdles, and stronger synergy among busi- other tools need to be in the professional’s ness units (Goodman, 1994, 1998). Acting toolbox to meet the challenge of change. A as a good citizen, modern corporations have professional needs the ability to: provided social services such as health care; or have funded public facilities such as parks, • teach; playgrounds, recreation buildings; or have • absorb and comprehend vast amounts of entered a partnership with the community complex information quickly; to maintain the infrastructure of highways • create and build relationships internally and bridges. For corporations with research and externally; and development ties, the corporation often • build trust in all your audiences; demonstrates its citizenship by support of • build a corporate culture. employee membership and participation in professional, scientific, and scholarly societies In addition, corporate communication de- and organizations. Such support includes mands an ability to solve problems in groups, attendance at conferences and encourage- to understand media and communication ment to take leadership roles in the organiza- technology, to work ethically, and to feel com- tions. fortable in a global business environment. The elements of communication continue to exert substantial influence in all transactions from Tools for the corporate simple customer questions of front-line sales communication practitioner and retail personnel, to the pressure negotia- tions involved in a multinational merger. Organizations use personality profile instru- Writing for organizations is growing in the ments to find the right person for the job. form of web pages, newsletters, press releases A corporate communicator should have: and speeches, etc. All those are still there. Now much more work for individuals acting • written and speaking communication as vendors is the result of ‘outsourcing’. The expertise; CCI Benchmark Study asked how corporate • understanding of the communication communication executives used vendors and process; agencies for their work. The most commonly • interpersonal skills: face-to-face and tele- cited were: phone; • media savvy; • advertising: 75.9 per cent • an understanding of customer, stake- • annual report: 73.7 per cent holder, and community needs; • internet: 46.0 per cent • curiosity; • public relations: 43.1 per cent • active listening skills; • identity: 43.1 per cent • an understanding of advocacy. • media relations: 40.1 per cent • marketing communication: 38.7 per cent In addition to excellent writing expertise, • crisis communication: 28.5 per cent superior interpersonal skill, the ability to • intranet: 22.6 per cent create media products – press releases, video, • investor relations: 18.2 per cent

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Only 8.8 per cent use a vendor for community Curiosity is also a valuable personal attrib- 2 relations and for issues management, and 6.6 ute for professional communicators. The com- 3 per cent use a vendor for employee relations municator must ﬁrst have an interest in what 4 and for labour relations. Less than 5 per cent is happening in the company and to its people 5 of companies use vendors for communication and customers to be able to communicate 6 policy, corporate culture, mission statement, that interest to others. Without interest, the 7 corporate philanthropy. Creation of messages writer’s message is bland at best, at worst 8 remains the work of the corporation itself phoney and hollow. 9 with its own resources. It appears that vendors Active listening is essential to effective com- 10 help with technology, production, distribution munication, and builds a relationship of trust. 1 and execution. Communicators understand the need for this 2 Corporate communication has evolved into fundamental business practice: listen to your 3 a complex profession, yet writing remains customers and employees. Consideration of 4222 the central talent to create any communica- the ideas of others places value on them and 5 tion in a corporate context. No matter what on your relationship with them. 6 the medium of the ﬁnal message, the ideas Understanding advocacy communication is 7 more often than not begin in writing. Under- also essential to corporate communicators. A 8 standing the writing process is fundamental to company spokesperson may be called upon to 9 communication and media applications. put aside personal opinion in favour of a com- 20 The writing process also serves as a model pany position. Because of this fact of corpor- 1 for the communication process, and empha- ate life, the ideal corporate communicator is 2 sizes three main areas of analysis: someone who has been with the organization 3 for a long time. 4 • audience, Integrity is extremely valuable for any 5 • context, organization, and any corporate spokesperson 6 • content (message). should instil trust in the audience. Without 7 trust, the message is unlikely to have the 8 Corporations routinely target a message for a desired impact or much positive impact at all. 9 particular audience, meeting their needs Integrity and trust are built over time through 30222 while achieving the company goals. Successful attention to detail, consistency in message, 1 communication puts human interaction at its follow-through on promises. It is reinforced in 2 centre, and in a collaborative corporate face-to-face contact with customers and 3 environment seeks to win both for the organ- employees through body language and eye 4 ization and for its customers. contact, as well as words. Integrity and trust 5 The type of person who has the ability to are built with every act and every message of 6 collaborate is someone who can see an issue an organization. 7 from several perspectives and create a mes- 8 sage based on analysis rather than on per- 9 sonal bias. Groups and presentations 40 The ability to see a message as a graphic 1 image, or series of images, is also essential. No Corporations and organizations function 2 one can deny the impact of visual media on through groups, and as collections of groups. 3222 how people gather and process information. Note the language: management team,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors quality circle, quality action team, manage- new etiquette of human interaction. As these ment committee, board of directors, product customs and rules develop, the corporate management group, crisis committee. communicators will be in the vanguard of the Whether an organization emphasizes old- change. style hierarchical leadership techniques, what have been called Theory X, or more contemporary consensus management styles – Selecting media Theory Y or Z, the ability to work effectively in and with groups is an essential element in a Corporate communication requires profes- broader definition of corporate commun- sionals to determine the best media for ication. The reengineering and quality pro- both the message and the audience: high- grammes are built upon a foundation of technology digital multimedia to low-technol- shared commitment to corporate goals. Most ogy posters in the company lobby; a new communication at work occurs in small company logo to a ‘dress-down’ day for groups. employees are possible media for corporate People give numerous presentations messages. Selecting the right medium for the related to actions and projects. Companies message plays a central role in the success of and industries have their own particular pre- the communication. The corporate communi- sentation style. In engineering and high-tech cation professional selects media, keeping in ﬁrms, the presentations are straightforward mind the message, the desired effect on the and factual. Engineers prefer an analytical audience, and the corporate environment. presentation of the facts. Visuals tend to be Cost is always a factor since resources – time, overhead projections, or slides in formal situa- talent, money – are limited and budgeted. tions. Management presentations, on the other hand, tend to be brief and direct with the Negotiation skills for advocacy use of slides and video. More effort, however, communication is spent on the form of the presentation than would be for an audience of technical Contemporary management experts identify experts. Managers expect a presentation of at least six patterns of interaction in negotia- the options, alternatives, and solutions, rather tions: win–win, win–lose, lose–lose, lose–win, than an analysis alone, because they need to win, or no-deal. Even though contemporary see the results of an analysis. Decision makers, business is highly competitive, it is also then, expect a polished presentation, not a extremely co-operative and interdependent. slick one. Win–win thinking seeks benefit in interac- Increasingly, meetings are on interactive tions, and selects agreements or solutions to video networks, computer networks, and by problems that are mutually beneﬁcial and sat- email. Meetings can occur through comput- isfying. The contemporary business environ- ers, changing familiar patterns of eye contact, ment is one in which today’s competitor is facial expression, and body language in face- tomorrow’s partner. Win–win builds an to-face communication. Like the telephone, environment of trust since the solution is not computer-mediated communication calls for a your way or my way, but a better way.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Building a corporate communication 3 basic assumptions about human activity, 2 culture human nature and human relationships, as 3 well as assumptions about time, space, and 4 Forces within organizations shape and influ- reality; level three is often intuitive, invisi- 5 ence the behaviour of individuals in subtle, ble, or just below the level of awareness. 6 yet powerful ways. These forces, like the 7 wind and the tides in natural environments, Examples of artefacts and behaviours abound: 8 are often unseen and unnoticed themselves, corporate logos, the company headquarters, 9 but their effects can easily be observed. annual reports, company awards dinners, the 10 These forces combine to create the culture. annual golf outing, the business attire at the 1 Corporate culture (Deal and Kennedy 1982; main office. The artefacts and behaviours can 2 Ott 1989; Goodman, 1994, 1998) has be- be observed. Often these are outward mani- 3 come a concept that, used appropriately, festations of what the corporation believes 4222 offers the intellectual tools for an insightful and values, no matter what it says its values 5 analysis of a organization’s beliefs and behav- and beliefs are. 6 iour. Used improperly, it devolves into jargon Examples of values and beliefs may be 7 and faddism. In an anthropologist’s terms, articulated in a slogan or an ad campaign, 8 all human groups by their nature have a cul- such as Ford’s decades old, ‘Quality is Job 1’, 9 ture – the system of values and beliefs or GE’s ‘We bring good things to life.’ These 20 shaped by the experiences of life, historical are simple, yet effective ways to put into 1 tradition, social or class position, political words what may be complex and difficult con- 2 events, ethnicity, and religious forces. In this cepts. Both examples present a complex 3 context, a corporation’s culture can be pledge from the company to its customers to 4 described, understood, nurtured and coaxed create products that improve their lives. 5 in new directions; but rarely created, planned Companies that actually write a values state- 6 or managed in the same way a company ment find the task difficult because the written 7 creates a product or service. presentation too often sounds like the values 8 Nevertheless, an organization’s culture statement of almost any company. Cliches and 9 plays a powerful role in its success, and in its platitudes can make the most honest presen- 30222 failure. For this reason, the discussion of a tation seem hollow. 1 corporation’s culture offers a foundation for Basic assumptions, the third level, is even 2 understanding the group’s behaviour, and more difficult to articulate because it requires 3 suggests ways to either perpetuate or change the analysis of both what the company says 4 the cultures. and an observation of what it does, then a 5 Deal and Kennedy popularized the term synthesis to determine conflicting areas. One 6 corporate culture in 1982. A corporation’s cul- example of a fatal conflict between the pro- 7 ture, exhibits three levels: jected basic assumption and what lay beneath 8 the surface was the demise of investment 9 1 artefacts and patterns of behaviour which houses E. F. Hutton and Drexel Burnham in the 40 can be observed, but whose meaning is 1980s. Both companies quickly lost clients’ 1 not readily apparent; trust when scandals surfaced which under- 2 2 values and beliefs which require an even mined the integrity a client expects from an 3222 greater level of awareness; investment bank.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Signs of a culture in trouble • preselection and hiring of new employees; Can a problem with corporate culture be iden- • socialization of members; tified? Weak cultures have no clear values or • removal of members who do not fit in; beliefs. Members often ask for an articulation • presentation of behaviour appropriate to or written statement of the mission of the the culture; group. When a mission statement is available, • justification of behaviour that is beyond people in the organization routinely ridicule it the norm; as a fantasy having little to do with what the • communication of cultural values and company really does. Weak cultures also beliefs. exhibit many beliefs. That may appear to be tolerance, but no agreement on the most Many corporations have a clear idea of the important beliefs plants seeds of confusion kind of people they wish to hire and that pro- and undermines motivated employees. Some file provides them with a guide for recruiting. beliefs may develop into an ingrown and The analogy is a sports team that drafts play- exclusive subculture, and the subculture ers with certain talents and skills, but also with values then pre-empt the company’s. Destruc- the ability to fit in with the other players. tive and disruptive heroes are apparent in A corporation does the same thing. cultures in trouble. In direct conflict with the Once a person is recruited and hired, the organization’s stated beliefs and values, an corporation requires the socialization of its executive’s abusive, harassing, or uncivilized new members through a formal orientation behaviour may be ignored because he or she programme, followed by less formal socializa- looks great on the bottom line. Other signs tion in the first few weeks and months on the include disorganized rituals of day-to-day job. Some organizations go further by institut- life resulting in a pervasive sense of fragmen- ing a mentoring programme to reinforce the tation and inconsistency. People in the organ- corporate culture. Sometimes the match does ization do not know what to expect from one not work out, so the member who does not day to the next. As a result, the organization fit must be removed. This is usually done develops an inward, short-term focus. Signs of within an initial probationary period. The per- such deterioration can be observed in low formance appraisal has come to be the instru- morale, emotional outbursts and subculture ment for perpetuating the corporate culture. clashes. Appropriate behaviour is generally written in a formal employee handbook, a guide to ethical behaviour, and a company code of Perpetuating corporate culture conduct. These documents function as the formal presentation of the company culture. If corporate culture can be understood The informal code is in normal activity, tradi- through analysis and observation, and if it can tion, and company custom. When a member be modified through change programmes, of the company breaks the customs, the corp- then corporate training can be used to nurture oration must justify this apparent deviation and perpetuate a culture that is desirable. from acceptable behaviour. Several methods on how a culture perpetuates Perpetuating the culture is vital to survival. itself, afford an opportunity for training: Of the hundreds of automobile makers in

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 America some seventy years ago, only three contain clearly articulated goals, methods and 2 major ones remain. Since chance and luck can measurements that coincide with larger corp- 3 happen to anyone, the survivors must have orate goals. 4 developed a culture that evolved with the Community relations, or outreach pro- 5 changes in the market and technology. grammes are now more closely allied to the 6 core business. For instance, the public utility 7 may sponsor and run a series of seminars 8 Building relationships at retirement homes and villages on coping 9 with power outages due to a thunderstorm or 10 Corporate relations hurricane. The same utility may offer courses 1 for home owners in how to handle and repair 2 Corporate identity is more than the sum of electrical appliances safely. Other companies 3 these parts: mission statement; logo, letter- may donate services like a telephone bank 4222 head, and annual report; advertising; internal or computers to help with fundraising. Often 5 perception programmes; external communi- a company will set aside a day to help the 6 cation and public perception of company local community by building a community 7 image. People learn to recognize a company playground or renovating a park. And more 8 by everything it does, from the products and and more organizations are sponsoring a 9 services it sells, to its buildings and employ- section of a highway for litter control, their 20 ees. Mergers and acquisitions, downsizing, participation indicated by signs along the 1 and restructuring have treated corporate rep- roadside. Outreach programmes also include 2 utation and image rather roughly. From GM to corporate education programmes in commun- 3 IBM the face of business has changed dramat- ities, schools and universities. Sometimes out- 4 ically. The need to build corporate identity reach programmes may include adult courses 5 through corporate culture has never been in first-aid, water-safety, crime prevention, 6 more important to a company’s survival than recycling. Company representatives often 7 it is leaving the twentieth century and enter- speak at high schools or colleges about a 8 ing the twenty-first. Corporate identity can be career in an industry and one at the company 9 demonstrated through a traditional relation- in particular. Blood drives for the local Red 30222 ship with various publics. With the change in Cross depend on corporate participation, as 1 the American economy and way of life from does the United Way. Companies also offer in- 2 rural to urban during and after the industrial kind gifts such as used, but useful, office furni- 3 revolution, the role of the organization in a ture and equipment to local charities and 4 community changed. No longer was it suffi- schools. During natural disasters, corporations 5 cient for a business to only pay taxes and stay are a valuable source of volunteers, as well 6 out of the affairs of the community. Its pres- as equipment, food, clothing and medical 7 ence there had a strong impact on the lives of supplies. Such activities are often done with 8 the people. Public relations has come a long little or no fanfare depending on the corpor- 9 enlightened way since its beginnings when ate attitude toward volunteerism. 40 wealthy company owners handed out nickels Government relations is the meeting with 1 to the crowds. The role of public relations is local, state, federal and in some cases inter- 2 now a strategic element in the business plans national agencies to advocate for the corp- 3222 of most corporations. Public relations plans oration on matters in its interest. Some

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors corporations will provide legislators and have a better chance of surviving difficult agency professionals with position papers and periods than companies that do not listen to information designed to inform and persuade their customers. Solid, positive relations with the agency. In the marketplace of ideas, such customers is a fundamental part of the quality advocacy efforts often make the decision revolution in America. clear. Individual corporations have in recent years avoided direct lobbying efforts in favour of joining an industry advocacy group that Media relations does that work for all companies in a given industry. Because of abuses in the past in Creating good media relations requires con- trying to influence the government decision- stant effort and attention, and a mature corp- making process, this area of corporate com- orate attitude toward the public and the munication demands the highest ethical media. The contemporary business environ- standards. Each company develops its own ment is awash with media – newspapers, code of business conduct which often includes magazines, professional and industrial jour- standards and procedures for ethical practices nals, TV, business radio, multimedia, the with fellow employees and subordinates, with worldwide web. Corporations spend millions customers, with vendors, with the community on marketing and advertising so their mes- and with the government. sage can reach their current and potential Customer relations is considered the ‘front customers. If the press sees a corporation’s porch’ of the corporation. How a corporation product or service as news, then it will write routinely treats customers and vendors, as or broadcast a story. Many organizations well as how it handles an angry customer’s measure the media coverage in terms of the complaint about a product or service, form equivalent cost of advertising. Coverage is the foundation on which the corporation’s the goal of any media relations plan. Good image is built in the minds of individuals. It relations with the press result when the can be inviting and co-operative, or cold and reporter checks with the corporation to vali- impersonal. Successful companies make every date statements and facts. Their contact offers effort to meet customers’ needs. The old an opportunity to set the record straight, or cliché, ‘The customer is always right’, is not a put the facts into a clearer, more objective, cliché for most companies. It is an informing context. Rumours and inaccuracies can be philosophy. It is also a central principle in the corrected. quality movements that have infatuated American businesses through the 1980s and 1990s. Satisfied customers come back again. Developing a media strategy Disgruntled customers do not; and they also tell at least ten others about their bad experi- A media strategy is important locally and ence. Good customer relations depends on globally. The process follows a four-step positive word-of-mouth. The service industry problem-solving model. has made customer relations not only central to the company business strategy, but an art • Define the problems. Write a problem form. In a market driven economy, companies statement, and analyse the situation. The with close relationships with their customers analysis requires gathering, processing

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 and interpreting information. Listening Investor relations 2 and observing are fundamental methods. 3 The interpretation of information helps to Building relationships with the investment 4 confirm the problem statement, or to community, a central function of corporate 5 restate it in a new light. The analysis communication, demands clear, honest inter- 6 should lead to planning. action. Not only is it good practice, but laws 7 • Plan. Articulate goals and objectives, and and regulations require full and fair disclosure 8 develop a programme of actions to of material information to the marketplace. The goal of this flow of information is to give 9 achieve them. Identify the audiences or analysts and investors the best information 10 ‘publics’, the goals for each, and the mes- possible so they can fairly assess the value 1 sage and media strategies determined to of your company. The information allows 2 meet the goals. Budget time and other informed decisions about the strengths and 3 resources that must be committed to the prospects of companies. 4222 programme. Planning also involves the 5 Communication builds a company’s mutu- evaluation of the performance of the pro- ally beneficial relationships with investors, 6 gramme. 7 analysts, and stockbrokers. Information about • Implement plans and communicate mes- a company that is candid, complete, timely 8 sages. The fundamentals of the communi- 9 and honest is the foundation of a strong posi- cation process offer the key to successful 20 tive relationship. Companies help investors implementation. Understanding the corp- 1 develop realistic expectations by providing orate goals and objectives, fitting them to 2 accurate information for analysing results the audience needs and expectations, and 3 and making forecasts. The relationship keeps being mindful of the context in which the 4 big surprises from occurring. Investors and communication occurs applies. The goal is 5 analysts prefer companies that have pre- 6 to change the thinking and behaviour of dictable performance and provide reliable 7 the audience. information. Once communication establishes 8 • Evaluate. Evaluation of the effectiveness of the company’s credibility, investor confidence 9 the programme can vary from the number in management grows. 30222 of column inches or the number of min- A strong relationship with investors can 1 utes on the air the effort generated; to the help in flat or down quarters. Investors accept explanations, are more patient, and may be 2 increased awareness of the issues meas- more inclined to hold the stock. Communica- 3 ured in the target audience; to changes in tion vehicles for investor relations are: 4 attitudes, opinions, or behaviours; to evi- 5 dence of economic, social or political • Printed matter: company prospectus, 6 change. The criteria and evaluation meth- annual reports, quarterly reports, 10K and 7 ods must be determined as the pro- 10Q reports, press releases, fact books, 8 gramme is planned and as it evolves. corporate background or overview state- 9 ments, Securities Exchange Commission 40 Table 13.2 offers some suggested actions as filings, the proxy statement. 1 guidelines for meeting the press. The informa- • Oral presentations: annual meetings, brief- 2 tion in the table is often cited by scholars and ings, conference calls, telephone contacts, 3222 practitioners. audio tape reports.

Suggested action Rationale

Be prepared In an information society such as ours, having accurate data and timely statistics is expected. Not only are you giving your valuable time to discuss issues and events with the press, but their time is valuable also. So, do your homework, and prepare wisely for a press interview Make your points Have three main points you wish to get across. Just as you would in an executive summary of a report, or in a marketing communication, identify clearly the main ideas that make up the message you want communicated Be concise But avoid yes, no. Show awareness of the space and time limitations of the media by presenting positions clearly and concisely. Although brevity is a virtue, the press also looks for interest. Yes and no answers make the story difficult to write, and uninteresting for TV or radio Get comfortable Remember that movements and eye contact communicate non-verbally. When meeting face-to-face with the media prepare for the discussion by making sure that you will not be interrupted. A conference room set aside for outside guests is a good idea Tell the truth Building credibility with the media begins with their perception of you as a source of accurate and truthful information. Integrity is a valuable attribute. People react positively to people they perceive to be genuine. Being yourself is linked with telling the truth and is part of building corporate integrity Use the printed word Prepare for press encounters with a printed statement or press release. The document helps reporters get facts straight: figures, statistics, the spelling and titles of people mentioned. Remember the reporter’s job is to report the facts, and getting accurate information includes often complex and detailed data Keep your composure The media must attract readers and viewers to sell advertising. Such pressure translates into the search for unusual or controversial angles. Journalists call this the ‘hook’, the means to capture the audience’s attention. Offbeat, even offensive questions are a common tactic to elicit an emotional reaction that would make a good headline. So be cool under pressure Think of the reader or Remember the importance of the audience in any communication. Consider how viewer remarks would appear on the front page of the New York Times or the Wall Street Journal, or the local TV news, or on the national news Say you don’t know When asked a question that stumps you, or requires information or data you do not have at hand, say you don’t know. Follow up immediately with plans to get the information, and an offer to contact the reporter later, preferably before their deadline Hypothetical questions, Reporters may ask questions that lead to speculation. Such questions are particularly third-hand information common when corporate officers are asked to comment on possible mergers, anticipated layoffs, or restructuring. Also, if reporters cannot identify the source of their information, politely decline to discuss rumour and hearsay because of your company press policy Sensitivity to deadlines The daily production of newspapers and TV or radio broadcasts places strenuous demands on reporters to file their stories on time. It is a common courtesy to ask at the beginning of an interview when the reporter’s deadline is Accessibility Give reporters a contact number, an email address, and a fax machine number to indicate that you will be available for follow-up questions as the story is being written, and later as a source for other stories Forget ‘off the record’ If you don’t want something to appear in print, or broadcast, then don’t say it ‘No comment’ Finally, the press universally interprets the response ‘no comment’ as a ploy to hide something. Say clearly the company does not discuss proprietary issues, or matters that have personal impact on employees Be human and tell the truth

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • Electronic means: email, broadcast fax, Stages of a crisis 2 videotape reports, online information ser- 3 vices and databases, the internet. Many people who write about crises and 4 management use a medical analogy. In the 5 The annual report is the primary publica- First World War, medics developed triage for 6 tion that is given freely to introduce the com- rendering aid on the battleﬁeld: pany to the outside world. It provides 7 • not seriously wounded who could be information on the company’s progress and 8 treated and released; accomplishments for the investment com- 9 • those near death for whom no amount of munity, stockholders, employees and the gen- 10 effort could make a difference; and eral public. An indirect but essential goal of 1 • those who would most likely recover if the annual report, and one other way to jus- 2 something were done immediately. 3 tify its expensive production is its role in per- 4222 petuating the image and identity of the The triage model applies to communication 5 organization. Copies of the report not only and actions during the crisis itself, when time 6 go to all registered stockholders, but also to to contemplate and analyse is all but non- 7 Wall Street analysts, the business press, stu- existent. The triage approach ﬁts the manage- 8 dents, libraries, vendors, trade associations ment principle of applying limited resources 9 and professional groups. The report is often a for their greatest impact. Another model iden- 20 requirement in new business proposals to tifies the development of disease through 1 clients and the government, and frequently stages: (1) prodromal, (2) acute, (3) chronic, 2 used for employee recruiting. (4) resolution to a normal state. In practice 3 Given all these uses, every element of the you can refer to (1) the precrisis stage, (2) 4 annual report is designed to contribute to the the clear signs of a crisis, (3) the persistent 5 positive image of the company: reemergence of the crisis, and (4) the resolu- 6 tion. Airlines, utilities, computer operations, • artful covers, excellent photography 7 hospitals plan for the unthinkable because • CEO’s letter 8 they have learned from painful experience • summary of accomplishments 9 that the unthinkable has a nasty habit of • discussion of plans for the coming year 30222 happening. • auditors’ statement and balance sheet 1 • ten-year comparison of financial high- 2 lights Crisis communication plans 3 • footnotes to satisfy Securities Exchange 4 In the past what happened in a business was Commission regulations. 5 literally no one else’s business. Corporations 6 cut off questions with a curt, ‘No comment’. 7 Communication in crisis Such closed door policies create an informa- 8 tion vacuum. With the trend toward sensa- 9 This section discusses stages of a crisis, plan- tionalism, many reporters will do just that, 40 ning for and managing a crisis, and respond- often in ways damaging to the organization. 1 ing during the crisis and after. The remainder Employees also fill the information 2 covers crisis preparation through issues vacuum, fuelling the rumour mill within 3222 management. an organization. Combine one disgruntled

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors employee and one ruthless reporter and the do have difficulties. Gerald Meyers identifies result can be a major headache for the com- nine types of crises: (1) public perception, (2) pany, which can become the catalyst in a sudden market shift, (3) product failure, (4) media feeding frenzy with unpredictable top management succession, (5) cash flow outcome. Co-operation with the media and problems, (6) industrial relations, (7) hostile employees is a much more prudent and takeover, (8) adverse international events, (9) mature policy for any organization to take in regulation and deregulation. normal times and in times of crisis. Planning for a crisis implies the people in Planning for a crisis as a fact of corporate the company can recognize a crisis when it life is the first step in its resolution, and a sub- occurs. People experience generally the same sequent return to normal operations. No one stages when faced with adversity or catas- can predict when an event will occur, only trophic loss: denial or isolation, anger, bar- that sometime in the life of an organization gaining for time, depression and grief, and a product will fail, markets will evaporate finally acceptance. An organization is no because of a new invention, stock will fall, an different since it is made up of people. Organ- employee may be caught doing something izations experience: (1) shock, (2) a defensive illegal, the CEO will retire, the workforce retreat, (3) acknowledgment, (4) adaptation will go on strike, a natural disaster will occur, and change. a terrorist will plant a bomb. It is perfectly normal for executives to avoid thinking about a crisis. Positive thinking is Responding to pressure groups and embedded in the way managers are taught crisis preparation to be effective. Problems are opportunities; one person’s misfortune is another’s fortune – Interest groups can make corporate life diffi- and so it goes. Admitting that a crisis could cult for companies either through public occur is to entertain the greatest of corporate demonstrations staged to capture media sins: failure. attention, through announced boycotts of The tendency to ignore the worst also products and services, through direct harass- recognizes that people cannot control events. ment of company executives and employees, Being unable to control the forces of nature or through terrorist acts directed at the certainly does not mean weakness on the part corporation. of managers. It merely indicates that people The conflicting power of money and moral- must plan to deal with emergencies and their ity is at the heart of understanding the social consequences. Weakness comes only when fabric of contemporary business. Freedom people do not prepare for events. Companies of choice, freedom of religion, free markets which get into trouble are often the ones pull and tug at one another over the issues which never considered that bad things would of the environment, sexual behaviour and happen to them. practices, and behaviour that could corrupt Emergencies, disasters, bomb threats, crim- the individual and the community. These inal charges, executive misconduct . . . None issues represent the sharp edge of social of these may happen, but a well run corpora- change, potentially valuable in a dynamic free tion develops plans in case the unthinkable society, or a grave danger to the health of occurs. Even the best run companies can and the corporation.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 People on their own and in organized Communication technologies 2 groups have been, and continue to be, 3 extremely vocal on these social issues. They Knowledge is power. Electronic media offered 4 express their position with their pocketbooks. the productivity and communication tools to 5 Monitoring social change is the best way a usher in the information age to organizations. 6 company can prepare itself for new markets, It was simultaneously a lever to flatten hierar- 7 and for changes in existing customers’ atti- chical organizations and to provide the means 8 tudes. Social change is often not indicated on for an empowered and informed workforce. 9 the traditional balance sheets, but its power However, ‘the paradise of shared knowledge 10 can be felt as changes influence the corpora- and a more egalitarian working environment 1 tion and the community it serves. just isn’t happening. Knowledge isn’t really 2 During the ‘greed’ decade of the 1980s, shared because management doesn’t want to 3 the drive for profit forced many companies to share authority and power’ (Zuboff, 1996). 4222 rank very low the impact of their actions on Are these the signs of a failed revolution, or 5 customers, employees, and the greater social are they more likely the end of a cycle in 6 good. Driven by corporate councils and a phil- which the organization and the individual 7 osophy that adhered to the letter of the law continue the struggle for dominance? 8 rather than its spirit, many corporate leaders Since the 1920s and 1930s, and through 9 asked ‘Can we do it?’ as opposed to ‘Should the depression, organizations worked toward 20 we do it?’ The environmental icons and the realization of a human relations model, 1 popular culture symbols of disaster such as described by Elton Mayo and expanded by 2 Chernobyl and Bhopal are the result. Abraham Maslow. 3 Companies can have their image tainted, and These theorists articulated the twentieth 4 by extension their brands, through a simple century conflict between the needs of the 5 6 act of indifference. According to Ottman, individual and the needs of the organization. 7 ‘In this new marketing age, products are being Then as now, this conflict remains the irrecon- 8 evaluated not only on performance or price, cilable force of the industrial revolution, the 9 but on the social responsibility of manufactur- post-industrial revolution, and of the informa- 30222 ers’ (Ottman, 1998). Consumers now look at tion age. Our electronic communication tools 1 the long-term impact of the product on soci- highlight the paradox. A single person can 2 ety after it is used. The concept of quality in influence the course of large organizations, 3 products now incorporates their environ- such as in the case of Intel’s troubled intro- 4 mental impact. Customers’ needs, laws and duction of the Pentium chip in the winter 5 regulations, and the reality of technology to of 1994–5. Such David and Goliath tales of 6 simultaneously create new solutions to clean organizational life make headlines. More 7 up the mess and also to cause a new mess, are often than not, though, it is the organization 8 the forces driving companies to include a that still wields such power and influence that 9 ‘green position’ in their marketing, advertising most contemporary Davids are overwhelmed 40 and corporate communication. almost effortlessly. Today David can be down- 1 sized, restructured, press-released, or budget- 2 cut into submission. Or David can be worked 3222 into submission, his support staff replaced by

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors productivity software, groupware and internet isolation, is also a fact of corporate life for access. communication professionals. Information technologies have changed the way we create, archive, access and distribute Impact of electronic media information. New technologies have made the access to, and use of, information more Tools, as anthropologists know, are the arte- egalitarian, less proprietary. Gatekeepers facts of a culture. Add a new tool to an exist- have been eliminated and new classes have ing culture, and it changes that culture. Our emerged – the information haves and the media technologies now allow us to com- information have-nots. Some experts (Zonis, municate anytime, anywhere. The impact of a 1996) see a global destabilization as a result global, 24-hour workday has profound impli- of these technical advances, for example, cations on our lives (Perugini 1996) and on a rapid breakdown in the power structure of how communication technology influences business, the family, and political organiza- our society. Gates (1996) and Negroponte tions. However, the equalizing power of (1995) to the contrary, the change is not information has flattened the hierarchical always positive. New media technologies – nature of organizations. With hierarchies the tools of communication – continue to disappearing, egalitarian and collaborative have a profound impact on corporate com- structures are emerging. The workplace, the munication. By their nature innovations are nature of work, and the fabric of our society tools, which may or may not require us to entered a change cycle that is rapid and un- change our behaviour. Technologies that relenting. Once the relationship between require us to change, Moore (1991) calls individuals and the institutions of our culture ‘discontinuous innovations’ and these tools could be relied upon. A bond existed that are not user-friendly. As such they are often engendered trust and loyalty; however, doomed to failure, or require several itera- contemporary executives find these rare tions to attract acceptance. commodities indeed. The issues that face communication profes- Email links computers to send messages sionals focus on human interaction – both from one computer to another. The systems with machines and with other people. The use have global reach through various networks of contemporary communication technolo- such as the internet and commercial gies in an environment of accelerating change, providers. These electronic communication political uncertainty, economic stress, and channels save time and distribute costs. uncertain corporate direction places new Messages can be posted on a general bulletin demands on the communication professional. board which anyone on the system can have No longer is mere superior talent with the access to, or sent to a distribution list, or to written word sufficient. Understanding the one person on the network. In many organ- ethical conﬂict of individual rights and corpor- izations email has replaced the use of and the ate goals is necessary for survival. With need for informational memos. Using email increased emphasis on team action and the to replace paper memos and physical dis- proliferation of empowerment programmes tribution of those documents has substan- through TQM and re-engineering, the need tially accelerated the communication within to work effectively with others, rather than in organizations.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 LANs (local area networks) function simi- They were told in school and observed 2 larly to email, but they are several computers from their parents that corporations and 3 in a particular location linked to form a net- organizations would not have a job for them 4 work that allows the users to share data and for life. They were taught in high school 5 programmes. LANs have the outward appear- and college to see each job as a learning 6 ance of a centralized computer, but the system experience for them to prepare for the next 7 functions more like a bundle of cells. job in their career path. Service was self- 8 The internet and the worldwide web came service, so they have no role models for 9 into wide commercial use after 1994. understanding the concept of the value-added 10 Companies have built web pages for fear of nature of customer relations. 1 being left out of this technological revolution. Enlightened self-interest was the appropri- 2 The internet may fulfil the predictions as inter- ate way to think about their place in the world 3 faces improve, the infrastructure gets better, of work. They saw what happened to their 4222 security becomes tighter, bandwidth becomes fathers and mothers who committed them- 5 higher, and full motion video is added. selves to work and a life of delayed gratifica- 6 Sceptics see the open architecture of the inter- tion – downsized at 55 just short of their net and the worldwide web as its reason for 7 pension and other benefits. success, as well as its commercial weakness. 8 Now the challenge is to motivate a genera- 9 Designed by the Defense Advanced Research tion of workers who have priorities vastly 20 Projects Agency (DARPA) to be able to with- different from the priorities of the company. 1 stand the catastrophic damage of a nuclear The work/life balance for corporations places 2 holocaust, its strength is in its open nature. So work first. For the new workforce, the work/ 3 security of proprietary company data cannot life balance means life balance. 4 be protected in this environment with high 5 confidence. Nevertheless, almost every com- 6 pany has an internet address, up from fewer 7 than half in 1995. The change process 8 9 The change process emphasizes a rethinking 30222 Communicating change in management practices from hierarchical, 1 authoritarian relations among managers and 2 What has changed in audiences and com- employees, to a consensus approach. The 3 munication channels? Globalization, women, focus is on teams empowered to identify and 4 Gen-X, Gen-Y, Gen-Z, Gen-Jones, the digital solve problems, and implement solutions. 5 generation . . . Communication and a new customer orienta- 6 The need to develop and maintain the tion are the cornerstones of the change in 7 organization’s culture has added to the chal- both company attitudes and practices, requir- 8 lenge of corporate communication. Em- ing corporations to make massive changes in 9 ployees are no longer captives to the the way people communicate within the 40 organization. They move often from job to organization and with those outside. Corpora- 1 job. They learned their lesson well from the tions continue constant and unrelenting 2 experience of the decades of downsizing, change – reinventing, rethinking, transform- 3222 restructuring, mergers and acquisitions. ing and re-engineering themselves. Change

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors also brings chaos, uncertainty and renewal. diverse in ethnicity, race, gender and age. For everyone involved, change represents a The need for individuals to work in groups threat to security, or an opportunity to move or teams at work has increased as a result forward. of greater technological complexity in the New and powerful forces are at work in nature of work itself. Even before the changing corporations: building of the pyramids of Egypt large projects demanded group efforts. Tech- • New sophistication in customers or audience. nological effort in the 1990s and into the The force of the customer is felt every- twenty-ﬁrst century implies that individ- where from consumer electronics, to the uals from a wide variety of backgrounds use of new management tools such work together in groups. The quality as integrated product development (IPD) process itself depends on groups of pro- in traditionally conservative, hierarchical fessionals and technicians at all levels organizations. Customers at all levels working together to achieve the common demand quality products and are hungry goals of the group. Interpersonal com- for information about the products they munication skill which begins with under- want. They are also looking for stimula- standing and respect for each of the tion and entertainment, which has pro- people in the group is the key to success- found implications for such fields as ful group performance. In a corporate software interfaces and the development culture of decision making by consensus, of the information super highway. the efﬁcient and effective interaction of • New media technologies. The number of members of a group is essential for com- communication channels available is munication. Prejudice and bigotry have increasing: email, fax, voicemail, desktop no place in corporate America. publishing, personalized magazines and • Stronger economic factors. Competition has journals, networking software and group- been the strongest economic factor for ware, the worldwide web. Because there change in corporations. It has forced the are more tools and more choices, con- quest for quality and efficiency as co- sumers need more information than ever equal goals in a company’s strategy. It has before. also forced the rapid growth in globalism. • More widespread ethical environment. Since • New strategic alliances. Ventures, partner- the tools of our technological age have ships, reorganizations, mergers, acquisi- enormous social and economic impact, tions, buy-outs, re-engineering, down- the ethics of the workplace must be con- sizing, rightsizing – more than buzzwords, sidered. No longer can a corporation these are the codes for a workplace in make a product and not worry, or care, upheaval. Almost every organization has about its impact on the community. undergone, or is undergoing, a profound Companies now function as ‘corporate change in structure or ownership. The citizens’. New methods of regulation and new alliances, if managed well and com- new laws underscore the responsibility municated clearly, signal a different way customers expect of providers. The work- of thinking about work in general, and force in America is becoming more about the workplace itself.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Qualities of organizations and people They engage the circumstances, rather than 2 necessary for successful change defend against change. 3 Such a person practises fairness, integrity, 4 An individual who sees the challenge of wide- honesty, human dignity – the principles that 5 spread changes in work processes and out- provide the security to adapt to change. 6 comes is best suited for technical innovation Understanding and managing expectations 7 and change. This person comes to work helps an individual or an organization through 8 smiling, often arriving early and leaving late. the change cycle. Rather than lower expecta- 9 No matter how much chaos the organization tions, manage them. In doing so, consider 10 is in, this person appears to respond well to that in responding to positive change most 1 the situation. people go through phases: 2 Others in the organization respond less well 3 to change and exhibit dysfunctional behav- 1 uninformed optimism or certainty at the 4222 iour. There are degrees of dysfunctional start; 5 behaviour related to change. For instance, 2 informed pessimism or doubt – people 6 examples of a low degree of dysfunction are: may quit publicly, or more destructively they quit privately and continue to work, 7 poor communication, reduced trust, blaming, allowing the negative feelings to generate 8 defensiveness, increased conflict with fellow 9 dysfunctional behaviour; workers, decreased team effectiveness, in- 20 3 hope emerges with a sense of reality; appropriate outbursts at the office. Moderate 1 4 informed optimism results in confidence; dysfunction: lying or deception, chronic late- 2 5 satisfaction closes the cycle of change. ness or absenteeism, symptoms such as 3 headaches and stomach pains, apathy, inter- 4 The good news is the cycle is predictable and personal withdrawal. A high degree of dys- 5 can be used to manage expectations by help- 6 function: covert undermining of leadership, ing people prepare for the rough periods. The 7 overt blocking, actively promoting a negative bad news is most people feel they are an 8 attitude in others, sabotage, substance abuse, exception and they will not follow the cycle 9 physical or psychological breakdown, family from beginning to completion. People neglect 30222 abuse, violence, murder, suicide. to consider that change carries an equal 1 The person who responds well to change opportunity for failure. 2 exhibits buoyancy, elasticity, resilience – the 3 ability to recover quickly from change. Such 4 people possess a strong, positive sense of The language of change 5 self, which gives them the security and confi- 6 dence to meet new challenges, even if they Often people react to new situations without 7 do not have all the answers. They are focused fully realizing their true feelings; nor can they 8 on a clear vision of what they wish to accom- articulate them. The metaphors they use 9 plish and they are tenacious in making the reveal and shape their understanding of 40 vision a reality. In addition, these people tend events. The metaphors of change can be 1 to be accommodating and flexible in the face roughly aligned with four types of organiza- 2 of uncertainty, and organized in the way they tional change: maintenance, developmental, 3222 develop an approach for managing ambiguity. transitional, transformational.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors • In maintenance, change is equated with Communication in international something broken or poorly maintained. environments Change means that something is wrong and needs to be fixed. The metaphor pro- ‘Act local, think global’ has become a familiar vokes a fix and maintain image repre- business mantra. The simplicity of the phrase sented by agents such as a mechanic, can lure the unsuspecting into a simple- maintenance worker, or ‘repairperson’. minded interpretation. Much has been writ- • In developmental, change builds on the ten on the need to compete in global markets. past and leads to better performance over The reality is that doing business in another time. In this environment teamwork is the country is complex and difficult. For a start, key to build and develop. The agent is it demands familiarity with the history, the often called trainer, coach, mentor, facili- politics, the alliances and treaties, the art and tator, or developer. You might hear literature of a country. An effective approach metaphors borrowed from sports, ‘There to learning about the transnational environ- is no ‘I’ in ‘TEAM’. ment also includes an understanding of: lan- • Transitional change involves a move from guage, technology and the environment, one condition to another. For instance an social organization, contexts and face-saving, operation goes from manual to auto- concepts of authority, body language and mated. The image is often one of move- non-verbal communication, concepts of time ment and relocation and the agents are (Goodman, 1995). often called planners, guides, or explor- ers. In such environments you might ‘need to create a map for unexplored ter- Language ritory’. • Transformational change implies the trans- Doing business successfully demands atten- figuration from one state of being to a tion to cultural, social, political and religious fundamentally different one. An example practices, in addition to technical, business, might be a business or industry that legal and financial activities. Communication changes from a regulated monopoly to a is the key to each. Real communication – not market-driven competitive business. The cookbook do’s and don’ts. The first step is to image is one of liberation, and the agents make every effort to learn the language. are called visionary, creator, liberator. Almost all people notice your effort to learn their language. This is more than just sym- Understanding and using the language of bolic. Language encodes culture, and making change benefits everyone involved, and helps an attempt to understand the words leads to them perceive change as an opportunity to trying to understand the way people think. move forward, rather than as a threat to their Learning the language helps to understand well-being. the way the people who speak it view their world. In addition to its power to convey information and ideas, language is also the vehicle for communicating values, beliefs and culture.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Technology and the environment and literature opens a window to the social 2 organization of the country you are working 3 The way people view technology and their in. These social structures influence business: 4 environment is culturally defined and has an 5 impact on international business communica- • family relationships; 6 tion. The way people view human-created • educational systems and ties to business; 7 work environments differs in the perception • class and economic distinctions; 8 of lighting, roominess, air temperature and • religious, political and legal systems; 9 humidity, access to electricity, telephones and • professional organizations and unions; 10 computers. People perceive their relationship • gender stereotypes and roles; 1 to the physical environment differently. For • emphasis on the group or the individual; 2 some, nature is to be controlled, for others • concepts of distance and attachment to 3 it is neutral or negative, and for others it is the land; 4222 something for man to be in harmony with. • recreational activity. 5 Even climate, topography, and population 6 density have an impact on the way people Contexts and face-saving 7 perceive themselves, and that has an impact 8 on the way they communicate, their concepts Contexts and face-saving refer to the way one 9 of mobility, and the way they carry on busi- communicates and the situation in which the 20 ness. Western managers expect a clean and communication occurs. Cultures are high-con- 1 relatively quiet office; one with dependable text, like the Japanese, and low-context like 2 lights, telephones, copiers, networked com- the German. In a high-context culture like the 3 puters and email, temperature control. British, details about class and education and 4 However, many countries ration essential even the place of birth are apparent in one’s 5 services such as electricity. Transportation and clothes and accent. On the other hand, low- 6 housing may not meet western standards. The context cultures require almost photographic 7 natural environment may be much hotter, detail for clear meaning. People all over the 8 colder, more humid or dryer than anticipated. world seek to preserve their outward dignity 9 Daylight in northern countries may be limited or prestige – face-saving. Cultures, however, 30222 in winter, and almost endless in summer. Heat differ in the emphasis on it. High face-saving 1 and rain may change the daily routine, partic- cultures have these general characteristics: 2 ularly in the tropics. Be prepared to adapt. 3 • high context; 4 • indirect strategy for business communica- 5 Social organization tion; 6 • toleration of a high degree of generality, 7 Social organization, or the influence of shared ambiguity and vagueness; 8 actions and institutions on the behaviour of • indirect communication considered 9 the individual, has a strong impact on busi- polite, civil, honest, considerate; 40 ness communication. Institutions and struc- • direct communication considered offen- 1 tures reinforce social values – the consensus of sive, uncivilized, inconsiderate; 2 a group of people that a certain behaviour has • few words used to disclose personal 3222 value. Familiarity with the major works of art information.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Low face-saving cultures have these general so effective in the west, may prove crude and characteristics: offensive elsewhere.

• low context; • a direct strategy for business communica- Body language, nonverbal tion; confrontational; communication • very low tolerance for generality, ambiguity and vagueness; Body language and nonverbal communica- • indirect communication considered im- tion are just as important in international polite, unproductive, dishonest, inconsid- and cross-cultural communication as they are erate; in communication within a homogeneous cul- • direct communication considered pro- ture. Important elements in international fessional, honest, considerate; communication are: kinesics (body move- • written and spoken words used to disclose ments); physical appearance and dress; eye personal information. contact; touching; proxemics (the space between people); paralanguage (sounds and Saving face is allied with concepts of guilt and gestures used in place of words); colours; shame. Shame is associated with high-context numbers; alphabets; symbols (such as a cultures; guilt with low. Low-context cultures national ﬂag); smell. value rules and the law; breaking the law or a rule implies a transgression – sin-and-guilt – as a mechanism for control. High-context Concepts of time cultures use shame as the agent of controlling behaviour through face, honour, dignity and Concepts of time differ from culture to cul- obligation. ture. Physicists such as Albert Einstein and Stephen Hawking, have demonstrated that time is relative. For purposes of communica- Concepts of authority tion across cultures, it helps to consider time as a social variable too. Time is deﬁned cultur- The concept of authority, influence and ally, and by shared social experience. power, as well as how power is exercised in the workplace, differs from culture to culture. In western cultures power is the ability to Corporate communication: make and act on decisions – an abstract ideal meeting the challenge of the discussed and debated by philosophers and future theorists. In Asian cultures, power and authority are almost the opposite of the western con- What is corporate communication, and who cepts. Power results from social order. Asians does it? Corporate communication is the total accept decision-making by consensus, and of a corporation’s efforts to communicate decide to be part of the group rather than the effectively and profitably. It is a strategic leader. Understanding the concept of power action practised by professionals within an helps shape a business communication strat- organization, or on behalf of a client. It is the egy. The direct approach to communication, creation and maintenance of strong internal

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 and external relationships. The actions any Using a communication professional under- 2 particular corporation takes to achieve that scored another shift in corporate commun- 3 goal depend in large part on the character of ication emphasis from a total focus on the 4 the organization and its relationship with its investment community or shareholders – any 5 suppliers, its community, its employees and its owner of the company’s shares or stock – to a 6 customers. broader interpretation of community which 7 Enormous changes in the workplace have now includes all ‘stakeholders’. A stakeholder 8 had an impact on the communication prac- is anyone who has a stake in the organization’s 9 tices of corporations and organizations. success: vendors, customers, employees, exec- 10 Avoiding print, broadcast and electronic utives, the local barber and the kid on the 1 media no longer sufﬁces as adequate com- paper route. 2 munication policy or even effective corporate The explosion in the number and type of 3 communication. A policy of developing strong media available for communication has also 4222 channels of communication both internally had an impact on the communication profes- 5 and externally has become a standard for sional. In the past, mastery of the written 6 most organizations. word was more than enough. Writing is still 7 Not only has the nature of corporate the core skill on which all others are built. But 8 communication changed over the last few a mastery of essentials of broadcast media is 9 decades, the type of people who create the now essential to the creation of corporate 20 company messages has changed as well. The messages for TV, radio, email, cable news pro- 1 typical corporate communication professional grammes devoted to business topics, multi- 2 is college educated with a degree in the media and digital communication on 3 humanities. A major in journalism, English, computer networks, and public speeches. 4 marketing, public relations, communication, 5 or psychology is common. Generally, practi- 6 tioners are loyal company people with a long When all is said and done 7 record in the organization. This reﬂects the 8 importance of the strategic nature of the With all the changes in the nature of work, the 9 organization’s communication. tools, the people, the companies, maybe 30222 Often the professional has had a minor in some simple guidelines might be helpful. 1 economics or business, or depending on the How about Nordstrom’s? They have two: 2 company’s core business, some related techni- 3 cal discipline such as engineering or computer 1 Use your best judgement 4 science. This may be in stark contrast to a 2 See rule 1. 5 previous generation of business professionals 6 with a background in law or accounting who Judgement, wisdom, understanding, integrity 7 have handled the company communication. – develop and rely on them. 8 9 40 1 2 3222

Belkin, Lisa (2000) ‘Life’s work’, New York Times, Meyers, Gerald (1986) When It Hits the Fan: Managing 5 July, G1. the Nine Crises of Business, Boston: Houghton Chronical of Higher Education (2000) ‘Remember Mifﬂin. when? This fall’s freshmen may not’, 8 Septem- Moore, Geoffrey (1991) Crossing the Chasm, New ber, A10. York: Harper. ‘Corporate Communication Benchmark Study’ (2000) Negroponte, Nicholas (1995) Being Digital, New York: Corporate Communication Institute, (www. Knopf. corporatecomm.org) Ott, J. Steven (1989) The Organisational Culture ‘Corporate Communication Spending Study’ (2000) Perspective, Paciﬁc Grove, CA: Brooks/Cole. Corporate Communication Institute for the Ottman, Jacquelyn (1998) Green Marketing, Lincoln- Council of Public Relations Firms. wood, IL: NTC Business Books. Deal, Terrence and Kennedy, Allan (1982) Corporate Perugini, Valerie (1996) ‘Anytime, anywhere’, IEEE Cultures, Reading, MA: Addison-Wesley. Transactions on Professional Communication, 39(1), Deal, Terrence and Kennedy, Allan (1999) The New 4–15. Corporate Cultures, Reading, MA: Perseus Books. Tahmincioglu, Eve (2000) ‘To shirkers, the days of Gardyn, Rebecca (2000) ‘Who’s the boss? The new whine and roses’, New York Times, 19 July, G1. American worker’, American Demographics Tapscott, Dan (1998) Growing Up Digital: The Rise of September, 53–9. the Net Generation, New York: McGraw-Hill. Gates, Bill (1996) The Road Ahead, New York: Viking. Wellner, Alison Stein (2000) ‘Generational divide’, Goode, Erica (2000) ‘How culture molds habits of American Demographics, October, 52–8. thought’, New York Times, 8 August, D1 and 4. Wellner, Alison Stein (2000) ‘Generation Z’, American Goodman, Michael B. (1994) Corporate Communica- Demographics, September, 61–4. tion: Theory and Practice, Albany: SUNY Press. Zonis, Marvin (1996) Speech at Chicago Graduate Goodman, Michael B. (1995) Working in a Global School of Business’s ‘Business Forecast ’97’ New Environment, New York: IEEE Press. York, December. Goodman, Michael B. (1998) Corporate Communi- Zuboff, Shoshana (1996) In The New York Times, cation for Executives, Albany: SUNY Press. 4 November, D1. McClain, Dylan Loeb (2000) ‘Forget the raise, give me some time off’, New York Times, 12 July, G1.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 14 2 3 4 Assessing integrated corporate 5 6 communication 7 8 David Pickton 9 10 1 2 3 4222 5 With the expanding remit of corporate communication and the realization that much of 6 its function overlaps the boundaries of other established professions, how can corporate 7 communication professionals provide to key stakeholders such as sales and marketing 8 specialists, a coherent and synergistic approach to communication? One answer, perhaps, 9 lies in an integrated corporate communication (ICC) strategy which can provide a practi- 20 cal guide. Standard assessments of any ICC strategy can be made through the use of two 1 suggested frameworks: namely dimensions of integration and continuum of integration, 2 both of which ‘add value’ to the employer and offer a way of looking at the communi- 3 cation role functionally, strategically and managerially. 4 5 6 7 8 Corporate communication spreads its tenta- tion process is rarely fully articulated or 9 cles throughout and far beyond the marketing understood. Wolter (1993) has complained 30222 function to the organization as a whole. (at least in the past) that it suffers from super- 1 Defining and delineating its boundaries is dif- ficiality, ambiguity and rigidity. Whilst ensur- 2 ficult and can be arbitrary. Overlaps exist ing the effectiveness and efficiency of each 3 between corporate and marketing communi- aspect of corporate communication is clearly 4 cation and arguments are rife as to which sub- important, so too is the need to manage and 5 sumes the other. Some of the debate is evaluate the impact and efficacy of the myriad 6 semantic and superfluous. Other aspects are communication activities that come together 7 born out of the development of ‘functional (White, 1997) either to work in harmony or 8 silos’ (Schultz, 1993). What is not contested is disrupt one another. This can be considered at 9 the multifarious nature of corporate com- a variety of ‘levels’ from the individual cam- 40 munication and in recent years a spotlight has paign to the holistic corporate communication 1 turned towards a deeper understanding of the effort (see Figure 14.1). 2 synergistic benefits of integrated communica- Integrated corporate communication (ICC) 3222 tion. However, the full extent of the integra- is not a new concept and the simple argument

O c n om e U S T O M E R m -t C u o n -o ic n a e Events Customer C t O io management N n service T s A Employee-publics Counter C Stakeholder T Lobbying contract sales communications Telemarketing Direct PERSONAL sales Publicity SELLING M

I A a

Trade sales M Corporate PUBLIC identity l N e Database P p management s e

– a A A l Exhibitions RELATIONS r p r

s s

G e G r

n o hub o v

n o E m

i o E Informationcentre

t a

o a l

g Sponsorship

o e

r Integrated

n l

Product

N l

t c

placement

r marketing

e Corporate o

b advertising communication v

ADVERTISING –

P planning

r A

a p

A SALES

N D PROMOTIONS POS Product advertising

Direct O Direct c n response Promotions o e advertising mail m - B m to R C incentive u -m A US NT n a N TO ME ic n D ME GE a y R CO ANA ti NTACT M on s T M A N A G E M E N

Advertising S p ales promotions overla

Figure 14.1 The wheel of integrated marketing communication for integration is that there are ﬁnancial, com- “sources” can lead to fragmented, sometimes petitive and effectiveness benefits to be even contradictory, external manifestations of achieved through the synergy afforded by the the company as a whole . . . It thus becomes process of integration (Pickton, 2001). clear why it is possible to observe a tendency Yet it is not easily achieved as there to strive for increased mutual coherence are many difﬁculties that stand in its way. As between all forms of internal and external Van Riel (1995: 3) comments, ‘In practice, communication.’ Integration has to be opera- the large variety of internal communication tionalized and to do so involves the develop-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 ment of working relationships with groups create a new image for the country while con- 2 that may, in the past, have been antagonistic vincing travel agents in the United Kingdom 3 towards each other. ‘Elitist’ attitudes are com- and Ireland that it was a competitive destina- 4 monplace (Robbs and Taubler, 1996; Gonring, tion in order to drive up bookings. The agency 5 1994; Swan, 1993) with each communication redesigned the Tunisian tourist logo and 6 ‘specialism’ claiming greater significance over developed a new range of literature to convey 7 the others (e.g. Varey, 1998). For integration a more modern feel than previous brochures. 8 to succeed, the perspectives of all involved They devised the new strap line, ‘More from 9 need to be viewed together but the very the Mediterranean’, to reinforce the message 10 fragmented nature of organizations, their that Tunisia is as close as many popular 1 management and the agencies within the Mediterranean resorts. To bring the trade on 2 communication industry impose problems. board, the agency briefed operators on the 3 Varey and White (2000) argue for a total campaign and ran a series of initiatives to 4222 stakeholder perspective and the need to stimulate interest. They sponsored the pre- 5 integrate communication activities around miere of the movie The English Patient which 6 constituent–constituent relationships. was filmed in Tunisia. To target consumers, the 7 A consequence of integration should be agency leafleted cinemas and ran a PR pro- 8 that corporate communication is coherent. gramme to highlight the appeal of Tunisia and 9 This was recognized by Meffert (1979), an its culture. Tunisia’s first TV advertising for a 20 early protagonist of integration, and consist- decade was created. Selected press and poster 1 ency should exist between all elements in- advertising was underpinned by a new web- 2 volved. Corporate communication should site. In all these ways, a variety of audiences 3 become both more efficient and effective was reached with a variety of media with 4 and this is all the more imperative when it is consistent and coherent messages in a very 5 argued that it plays a dominant role in achiev- cost efficient way. The total communication 6 ing organizational growth (Varey, 1998). process was managed as an integrated whole. 7 Linton and Morley (1995) list ten potential The outcomes were changed attitudes by 8 benefits of integration which they relate to consumers and trade alike and increased 9 marketing communication but the benefits tourism resulted. The Tourist Board was 30222 can be equally applied to corporate com- voted best in the UK annual awards. Bookings 1 munication as a whole. Within their list are to Tunisia from the United Kingdom and 2 included creative integrity, consistency of Ireland increased by almost 30 per cent year 3 messages, better use of media, cost savings on year. 4 and operational efficiency. An example of an Whilst it is argued that corporate communi- 5 integrated campaign that worked very suc- cation should be integrated, the extent of 6 cessfully was that for the Tunisian Tourist integration can vary enormously. Corporate 7 Board. Despite a fast-developing infrastruc- communication activities can vary from very 8 ture, research showed that people in the small, ‘one-off’, discrete pieces of communi- 9 United Kingdom and Ireland believed it to be cation (such as the mailing of a corporate 40 a long-haul destination with poor hotels and brochure), to the development of a larger 1 little more than a few camels for entertain- campaign which involves many promotional 2 ment. The Tunisian Tourist Board employed a tools, and even to the development and 3222 new agency who simultaneously strove to co-ordination of multiple campaigns intended

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors to achieve a greater goal possibly over an • Coverage of a range of target audiences extended time period in many countries. embracing all relevant stakeholders and The need for integration and the scale of that publics. integration becomes greater as the size and • Effective management of all forms of con- number of campaigns increase. It is necessary tact which may form the basis of corpor- to determine just how important it is that ate communication activity. all messages and images should be consistent • Effective management and integration of or whether they can remain completely all communication activities and people detached and, if so, what impact this is likely involved. to have on total effect. Particularly sensitive • Identification and recognition of the times are when organizational crises occur and impact of all product/brand communica- the corporate communications ‘machine’ has tion on corporate communication efforts. to be mobilized for damage limitation and, if • Exploitation of a range of promotional possible, gain positive attribution. tools – all elements of the communication mix including personal and non-personal Key features of integrated communication. corporate communication • Use of a range of messages – brand (corporate and products) propositions should be In its simplest form, integrated corporate derived from a single consistent strategy. communication (ICC) is the bringing together This does not necessarily imply a single, of all relevant corporate communication activ- standardized message. Integrated corpor- ities. However, this belies the rather more ate communication effort should ensure complex and significant managerial implica- that all messages are determined in such tions of integration that affect the entire a way as to work to each other’s mutual organization together with its relationships benefit or at least minimize incongruity. with its communication agencies and external • Use of a range of media – defined as any audiences. Van Riel (1995) recognized these ‘vehicle’ able to transmit corporate com- implications when he described corporate munication messages and not just mass or communication as the integration of manage- printed media. ment communication, marketing communication and organizational communication. The challenge to management is to assimilate What, then, might integrated corporate com- the various facets of corporate communica- munication incorporate? tion identified above in a way that appears seamless and co-ordinated. This is integration, Features of integrated corporate or what some prefer to call ‘orchestration’ and communication ‘joined-up thinking’. As will be shown later, any evaluation of the success or otherwise • Clearly identified corporate communica- of ICC should involve an assessment of how tion objectives that are consistent with well these features are brought together. other organizational objectives. While many may comment on how common- • Planned approach which covers the full sensical is the list of features above, there extent of corporate communication activi- remain practical difficulties in achieving their ties in a coherent and synergistic way. orchestration.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Barriers to integrated corporate business. Robbs and Taubler (1996) have 2 communication highlighted creatives’ aversion to integration 3 and their lack of willingness to work across the 4 The concept of integration is warmly em- media and communication mix. Schultz 5 braced by some but argued against by others, (1993) has commented on the cult of special- 6 sometimes for what they consider to be the ization and the history, tradition and experi- 7 sheer impracticality of integration. What is ence of companies as limiting factors to the 8 indisputable, however, is the fact that the fulfilment of integration. 9 whole communication business is going Moreover, there is the question of what it is 10 through a period of change which is having a that we wish to integrate. Hartley and Pickton 1 significant impact upon working practices (1997), for example, have discussed the 2 and philosophies. Developments in database developments in direct ‘personal commun- 3 technologies are encouraging and facilitating ication’ and their inter-linkage with ‘non- 4222 integration but as Fletcher et al. (1994) have personal communication’. Exacerbating the 5 discovered there are major organizational problem, many organizations relegate com- 6 barriers which can arise when a company munication activities to the tactical level and 7 attempts to move towards database manage- fail to appreciate their strategic significance. 8 ment in any significant way. There has been Any comprehensive approach to integration 9 growth in international communication and has to take the widest view, both strategic and 20 global branding requiring a much more inte- tactical. A ‘totally integrated communication 1 grated approach. Companies have become programme accounts for all types of messages 2 more sophisticated in their understanding and delivered by an organisation at every point 3 in their demands for communication services where a stakeholder comes into contact with 4 involving the whole organization targeted the company’ (Moriarty, 1994: 38). 5 6 towards multifarious audiences. There has 7 been increasing awareness of brand value and 8 brand equity and the role played by corporate Taxonomy and language 9 reputation. Despite such impetus for integra- 30222 tion it is not easily achieved. While the prob- The very taxonomy and language that are 1 lems of integration are not insurmountable used to describe the communication mix have 2 they are significant for a variety of reasons and a detrimental effect on the integrative process 3 these present barriers to the process. (Hartley and Pickton, 1997). The result is 4 that we perceive and encourage the uses 5 of communication as discrete activities. This 6 Mindset taxonomy (albeit it in simplified form) which 7 typically identifies the mix as personal selling, 8 The mindset built up over many years of prac- advertising, sales promotion, sponsorship, 9 tice has rewarded specialization and over- publicity and point-of-purchase communica- 40 looked the need for, and benefits of, tion (Shimp, 1997), is increasingly inadequate 1 integration. Gonring (1994) has identified the in expressing the range of activities it seeks 2 fear of change and loss of control felt by indi- to describe and presents major classification 3222 viduals associated with the communication difficulties. It is difficult, for example, to know

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors where to place within the mix categories discussion table’ to determine what is best for such varied activities as direct mail, product the total corporate communication effort. placement and endorsement, exhibitions, internal forms of communication, etc. Magnitude of task

Structure of organizations It is very difficult to conceptualize the ‘big picture’ and to muster all the organizational The structure of organizations may make it influences needed to achieve integration. difficult to co-ordinate and manage disparate There are many levels and dimensions to inte- specialisms as one entity. Organizations have gration which all pose their individual and typically subdivided their tasks into subunits collective difficulties. To be implemented, (departments) in order to cope with the mag- integrated corporate communication requires nitude of operations. Management’s response the involvement of the whole organization when faced with large, many faceted tasks and its agents from the chief executive down- has been to disaggregate them and give them wards. It needs consideration from the high- to specialists. While project teams and cross- est, corporate, strategic level down to the functional assignments can help to break day-to-day implementation of individual tactical activity. Among the most significant find- down organizational barriers there still remain ings from a collaborative study by Edelman problems of hierarchical structures, vertical Public Relations Worldwide, Northwestern communication, ‘turf battles’, power and University and Opinion Research Corporation ‘functional silos’ (Gonring, 1994; Schultz, in the United States were that the effective- 1993) in which individuals and groups are ness of corporate communication was criti- protective of their own specialization and cally dependent on the level of the most interests. Significantly, the increasing use of senior communication executive and that database technology and systems offers new there was too little corporate communication structural mechanisms for facilitating organ- with employees (Morley, 1998). izational integration.

Manager ability Elitism The need for cross-disciplinary skills creates a Not only do organizational structures encour- barrier to ICC. The skills required are wide, age separatism, there is a sense of perceived with few possessing the ability to master them elitism exhibited by individuals within each (Moriarty, 1994). communication specialism. Public relations specialists extol their superiority over advertising specialists who likewise extol their virtues Dimensions of integration over public relations, direct mail and sales promotion, etc. (Varey, 1998). For as long as There are many dimensions of integration. such views are held it is not likely that they If integration of corporate communication will come as equals to the ‘communication is to be achieved the problem must be

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 addressed in each dimension and between ing recognition and reinforcement. There is no 2 the dimensions. These dimensions or ele- agreement on how (or whether it is even pos- 3 ments of integration range from ensuring sible) to use output measures to satisfactorily 4 that the communication mix and messages assess the full array of all the individual ele- 5 are integrated and targeted towards a variety ments of corporate communication, let alone 6 of audiences to ensuring that integration is their combined effect. What should be used as 7 achieved between the many individuals and appropriate measures of assessment is hotly 8 organizations involved in the process. Nine contested. Furthermore, while a plethora of 9 dimensions in total have been identified and measures exist, it is the interplay and inter- 10 these will be explained in more detail shortly. action of numerous variables that ultimately 1 have an impact on the success or otherwise of 2 the communication; consequently, arguments 3 Output vs. process measures abound concerning the best use of output 4222 measures (important though they are). 5 Measuring communication effects has been An alternative perspective exists in which 6 notoriously difficult. While some elements are one might look at the ‘process’ of communi- 7 relatively straightforward, others are less so cation rather than its ‘outputs’ as a way 8 and, because of the multiplicity of variables of assessing its management and effective- 9 involved, spurious cause-and-effect relation- ness. Duncan (1994) has observed that there 20 ships can be (incorrectly) claimed. In assessing are two ways to measure and control most 1 communication, attention has previously operations – through the use of output con- 2 tended to focus on ‘output’ measures to eval- trols and through the use of process controls. 3 uate the results of communication; whether ‘Output controls evaluate the results of pro- 4 the activity has worked and to what extent – is grammes . . . Process controls evaluate how 5 the sale made, at what contribution; what programmes are developed . . . Up to now, 6 coverage is achieved, how many column however, process controls have seldom been 7 inches; what are the customer reactions, what used in marketing (and corporate) communica- 8 is their recall of the latest campaign; how have tion’ (p. 26). Having previously identified the 9 the range of publics responded, to what importance of recognizing that integrated 30222 extent do they hold positive attitudes; how corporate communication is a managerial 1 are employees affected by internal communi- activity, it seems highly appropriate under 2 cation, do they know the corporate mission these circumstances to adopt a ‘process’ 3 and objectives; what impact have financial driven approach to its assessment. To make 4 disclosures to the City had on share values; sense of this and to ‘map’ the total integration 5 and so on. process, two frameworks are presented below 6 Public relations utilizes an extensive array which will then be combined together to 7 of communication tools each with its own create an assessment profile (Figure 14.3) that 8 purpose and outcomes and each requiring dif- can be used by managers as a develop- 9 ferent means of assessment. Advertising is ment, evaluation and control tool. The first 40 seen as a strong force by some (e.g. Jones, framework (Figure 14.2) is the ‘Continuum 1 1995), having a direct bearing on sales, of Integrated Corporate Communication’. The 2 whereas it is seen by others (e.g. Ehrenberg second is ‘Dimensions of Integrated Corporate 3222 et al., 2000) as a weak force principally affect- Communication’.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Continuum of ICC the degree of separation and dysfunction, the greater the negative value of the corporate Integration permits the opportunity for all communication effort. The development of corporate communication activities to build corporate communication which lacks integra- together to create a greater positive ‘added tion therefore not only fails to add overall value’ than would otherwise be achieved by a value through lack of synergistic effects but also loose collection of unconnected activities. It is runs the risk of having a negative impact rarely the case that corporate communication through dysfunction. This is the cost of not is either fully integrated or not and Figure integrating – producing communication that is 14.2 illustrates the concept of a ‘continuum of counter-productive and which produces nega- integration’. On the right hand side of the tive effects when one piece of communication ﬁgure, as a greater degree of integration is contradicts or is at odds with another. The achieved, the greater the synergy in which extent of integration deemed to be necessary more positive beneﬁts result. At the central is further complicated by the ‘level’ of inte- point there is limited integration of campaign gration required which can vary from the elements but this results in only a neutral corporate down to the product brand or even effect. Beyond this point and to the left there to very local, one-off promotions. It is a is an increased likelihood of each activity matter of managerial decision and strategy detracting from the others which can result in as to what extent the corporate brand inter- dysfunctional communication. The greater acts with the product brand (contrast, for

Continuum of integration

Very strong Very strong dysfunction synergy

More segregation More integration negative effects positive effects

Segregation of corporate Integration of corporate communication elements communication elements

Increasing degree Increasing degree of separation and of integration and dysfunction synergy

Corporate communication Corporate communication suffer from dysfunction benefit from synergy

Figure 14.2 Continuum of integrated corporate communication

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 example, the different strategies adopted promotion and public relations – and com- 2 by Cadbury and Mars in the confectionery bines these disciplines to provide clarity, con- 3 market) or how much freedom is given to sistency, and maximum communication 4 local initiatives versus total central control. impact’ Such a description emphasizes the 5 roles of each communication tool and its 6 inter-relationship with the others. Implicit 7 Dimensions of integrated within this description is the need to integrate 8 corporate communication the objectives of each communication mix 9 element and all the media used. Media should By considering the various features of ICC 10 be recognized as any medium used for the identiﬁed earlier it is possible to summarize 1 transmission of messages. and represent them as different ‘dimensions’ 2 of integration. It is clear from even a casual 3 perusal of these dimensions described below 4222 Communication mix with marketing that a significant proportion of them are 5 mix integration related to organizational issues. It may be 6 argued that the most important implication of This is integration of the elements of the com- 7 ICC is the impact it has on organizational munication mix with those of the marketing 8 structure, systems, relationships and manage- mix. Not only is it necessary to seek integra- 9 ment. Unless these facets are addressed it is tion between the communication mix ele- 20 unlikely that any true sense of integration can ments but, also, it is necessary to integrate 1 be achieved. It is possible that organizations these with all the other elements of the mar- 2 and their agencies are misleading themselves keting mix and to integrate the objectives of 3 currently if they believe they have taken any- them all while ensuring consistency with other 4 thing more than the first tentative steps organizational objectives. It should be recog- 5 towards the integration of corporate com- nized that each marketing mix element has a 6 munication. The way is clear for those who potential communication value. For example, 7 wish to fully embrace ICC to achieve strong the price charged, or the nature of the distrib- 8 competitive advantage over those who are ution, or the materials used in the manufac- 9 only ‘tinkering around at the edges’. But they ture of the product all have something to say 30222 will only achieve this if all those involved about the brand and all have a communica- 1 become willing partners in the process. tion impact. True integration involves integra- 2 tion of all marketing and communication 3 elements. 4 Communication mix integration 5 6 This is integration of the elements of the com- Creative integration 7 munication mix. Integrated corporate com- 8 munication can be described as a ‘concept This is integration of creative themes, concepts 9 of corporate communication planning that and messages across the myriad corporate 40 recognizes the added value of a comprehen- communication activities. Creative integration 1 sive plan that evaluates the strategic roles need not imply the development of a single 2 of a variety of communication disciplines, theme and message although in many cases 3222 e.g. general advertising, direct response, sales this is the preferred approach because of the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors advantages generated by having a single This includes all relevant companies within a coherent message. There are occasions, how- corporate organization, members of its distri- ever, where such an approach is not necessary, bution chains and the various agencies that for example where there are clear distinctions work on their behalf, both above-the-line and between the audience groups targeted, or below-the-line. By way of facilitating this, where there are distinctive and separate prod- there has been, to some extent, a growth uct offerings, or where there are distinctive of agencies claiming to be ‘through-the-line’ corporate entities (strategic business units or providing a full range of corporate communi- SBUs) even if they are part of a single con- cation services ‘under one roof’. There are glomerate corporation. What is important is arguments for and against such an approach. recognition that themes and messages should be planned together with an understanding of the impact they may have on each other. Information and database systems

There is little dissent about the value of in- Intra-organization integration formation and a well-managed database for integrated corporate communication. The role This is integration of all the relevant internal of database management is well recognized, departments, individuals and activities within ‘As you integrate communication you must an organization which generate and impact integrate marketing activities. To integrate upon corporate communication. Such integra- marketing you must integrate sales and sell- tion may be achieved through restructuring ing, and to integrate those functions, you or otherwise ensuring that communication must integrate the entire organization . . . between all parties is facilitated and man- The goal is to align the organization to serve aged. This includes the interlinking and inte- consumers and customers. Databases are gration of relevant management and business rapidly becoming the primary management objectives and the provision of resources and tool that drives the organization’s business budgets to facilitate integrated corporate strategy’ (Schultz, 1997: 10). The focuses of communication. This might be described as corporate communication are the company’s the area of ‘internal marketing’. Also included stakeholders and target audiences among here is the internal management of all ‘con- whom are the consumers and customers. The tacts’ between stakeholder groups and the more that is known about them, the more organization. Many believe this is a funda- effective the organization’s communication is mental and distinguishing part of integrated likely to be. Today’s databases can be very corporate communication that can play a sophisticated. Computing power has created major role in achieving and sustaining com- the ability to store and cross-analyse vast petitive advantage. amounts of data such as service and sales data, all forms of transactional records, Inter-organizational integration and attitudinal and behavioural data. There are many ﬁelds of data covering millions of This is integration with and between all ex- relationships. Without this information it is ternal organizations involved in corporate unlikely that truly integrated corporate com- communication on behalf of an organization. munication can exist.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Integration of communication targeted gration is complicated through language, 2 towards internal and external audiences religious, cultural and regulatory variations. 3 Whilst it may be obvious that corporate com- 4 A variety of audiences, ‘publics’ and ‘stake- munication takes different forms in different 5 holders’, need to be considered within the countries, language, religious and cultural 6 context of a corporate communication cam- variations should also be recognized within 7 paign or variety of campaigns. The audience national boundaries as well, sometimes 8 members may be both external and internal within very small geographical areas. Belgium 9 to the organization. They will represent a vari- has the French and the Flemish; Spain has 10 ety of potentially disparate groups. Integrated the Basques and the Catalans; Malaysia has 1 corporate communication needs to consider the ethnic Chinese and the Malays; China 2 the roles and impact of each in order to has Mandarin speakers and Cantonese speak- 3 manage the total process successfully. ers; America has ethnic groups of many differ- 4222 ent origins. The task of successful integration 5 and national and global branding is made 6 Integration of corporate and ‘unitized’ significantly more complex because of these 7 communication features. 8 9 Corporate communication such as corporate 20 identity is often perceived as a separate The ICC assessment profile 1 activity from ‘unitized’ communication (e.g. 2 product, brand, personality, or trade com- By combining the concepts of the ‘dimensions 3 munication) and it usually has different of integration’ and the ‘continuum of integra- 4 people responsible who act as ‘corporate tion’, it is possible to develop an instrument 5 guardians’. Despite the separation, organiza- for assessing the ‘quality of integration’ of 6 tions clearly recognize the strategic and tacti- corporate communication. Figure 14.3 illus- 7 cal impact of corporate identity on all their trates such an approach to the assessment 8 other promotions. However, some achieve of integration. This is presented as an assess- 9 this integration better than others. Some ment profile. The profile provides the basis for 30222 organizations use their corporate identity as evaluating the overall extent to which integra- 1 the ‘umbrella’ under which they place all tion of corporate communication has been 2 their brands. Other organizations choose to achieved. It does not represent an objective 3 let their brands stand independently. Which- output measurement but is based on subjec- 4 ever the choice, the total corporate communi- tive appraisal of the various facets and process 5 cation process has to be carefully controlled to of integration. Output measures may be 6 ensure integration, consistency and clarity included in the use of the profile if so wished. 7 across all its different forms. The degree of integration may vary from 8 being strongly dysfunctional to strongly syner- 9 gistic and an assessment of these degrees can 40 Geographical integration be made for each of the dimensions identi- 1 fied. A tick or a cross can be placed in the box 2 This involves integration across national and considered most appropriate for each dimen- 3222 international boundaries. Geographical inte- sion of integration. The resulting assessment

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Dimensions of Very strong Strong Weak Very weak Very weak Weak Strong Very strong integration dysfunction dysfunction dysfunction dysfunction synergy synergy synergy synergy

Communication mix integration

Communication mix with marketing mix integration

Creative integration

Intra-organization integration

Inter-organization integration

Information and database systems integration

Target audience integration

Corporate and unitized integration

Geographical integration

Figure 14.3 Integrated corporate communication assessment proﬁle

creates a ‘profile’ of the integration achieved. tion of scores would be somewhat arbitrary The further right that more crosses appear, and is exacerbated by the fact that the relative the greater the overall quality of integration importance of each dimension is likely to vary. that has been achieved. If the profile is com- A simple, unweighted summation of scores pleted by a single individual, the results would, therefore, not be particularly helpful. would be somewhat subjective, however, it is A profiling approach is favoured over a grand recommended that the approach should in- total score as it makes more obvious the prin- volve a number of assessors who, through the cipal areas of weakness and strengths. More activity of assessment, are more likely to pro- focused development action can be taken as a duce an accurate and more objective profile. result. The very act of discussing the issues is, itself, of Figure 14.4 illustrates a completed profile. great benefit to the managers involved. In this The profile shows that there is room for way, the ICC assessment profile can be des- improvement on all dimensions and this cribed as a management development tool. would not be a surprising result as the general Scores could be assigned to each level of quality of integration of corporate communi- integration for each dimension of integration. cation across organizations tends to be poor. These scores could then be summed to pro- What is relevant to note from the profile is vide a grand total score. While this is entirely that the weakest area and one that is most feasible, it is not recommended. The alloca- in need of improvement is that of ‘intra-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Dimensions of Very strong Strong Weak Very weak Very weak Weak Strong Very strong 2 integration dysfunction dysfunction dysfunction dysfunction synergy synergy synergy synergy

3 Communication mix 4 integration

5 Communication mix with 6 marketing mix integration

7 Creative 8 integration

9 Intra-organization 10 integration

1 Inter-organization 2 integration

3 Information and database 4222 systems integration

5 Target audience 6 integration

7 Corporate and 8 unitized integration

9 Geographical 20 integration 1 2 Figure 14.4 Completed integrated corporate communication assessment profile 3 4 organization integration’. This suggests that tion, yet it is clear from the profile that atten- 5 there are benefits to be gained by paying tion to this aspect alone would be inadequate. 6 more attention to the ways in which the vari- Assessment of this single dimension may lead 7 ous parts of the organization work together to the inaccurate conclusion that a reasonable 8 in the context of corporate communication. degree of integration is actually being 9 Together with the results for ‘inter-organiza- achieved whereas the full picture indicates 30222 tion integration’, ‘information and database something quite different. Moreover, because 1 systems integration’ and ‘corporate and unit- of the interrelatedness of all the dimensions 2 ized integration’, the profile indicates that of integration it may only be possible to 3 significant improvements could result from a achieve further improvements in the area of 4 complete appraisal of the internal and exter- ‘communication mix integration’ through 5 nal organization relationships, communica- improvements in the other dimensions. In this 6 tion and management of the corporate instance, it is highly likely that improvements 7 communication process. in the levels of ‘inter-organization’ and ‘corp- 8 This analysis is all the more significant orate and unitized’ integration would have a 9 when it is realized that the level of integration significant effect on the ‘communication mix 40 achieved for ‘communication mix integration’ integration’. 1 is relatively high. It is this single area which is Recently this profiling technique was 2 most likely to be considered when attempting successfully used with managers in a large 3222 to achieve corporate communication integra- international company whose worldwide

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors headquarters is in Germany but has ‘local’ discrete campaigns although there was recog- sales and marketing headquarters in a variety nition that the same approach could be of countries. As part of a larger research exer- applied to the total corporate communication cise the profile was used by two groups of effort which would span across campaigns managers assessing two separate campaigns and extend over a period of time. The man- involving multiple communication activities, a agers emphasized the importance of care range of internal staff, a range of agencies and being taken to ensure that all those involved channel members, targeted towards a number should use the profile in a positive, mutually of different communication audiences. Assess- supportive way. They expressed concerns that ment profiles for the two campaigns were also criticism, implied or explicit, could be per- completed by managers not directly involved ceived negatively by individuals. in the campaigns and the results were compared. Preliminary findings from this work high- Summary lighted a general degree of consistency and agreement between the managers involved in The principal aim of this chapter was to eluci- the assessment and a general willingness for date the different aspects of integrated corp- them to be open, critical and ‘objective’. orate communication and to propose a means While there was a slight tendency to over- by which an assessment could be made of the inflate the assessment by the managers quality of integration attained. Two frame- directly involved in the campaigns compared works were suggested which identified the with those who were not, the differences were ‘dimensions of integration’ and a ‘continuum considered insignificant. Moreover, it was of integration’ along which the degree of inte- quite clear that the major benefits described gration could be assessed. By combining both by all concerned had less to do with the frameworks, a composite framework was ‘fine detail’ of the evaluations and more to do developed which can be used as a profiling with the discussions and development that instrument to highlight the relative strengths took place in completing the profiling exer- and weaknesses of integration. The profiling cise. The managers saw benefit in using the approach has been used successfully in profile as part of their deliberations when practice. formulating new corporate communication A method by which the profile can be used plans, monitoring plans as they were being was suggested which favoured assessment implemented to ‘track’ progress (and modify along each dimension rather than a determi- where appropriate), and evaluating at the end nation of a total score. The profile creates of a programme. They perceived the ICC insights into areas where further improvement assessment profiling approach as a manage- may be focused and effort channelled to ment development opportunity as well as an greatest effect. Assessing integrated corporate evaluation and control tool. They anticipated communication in this way provides opportu- the learning that took place would also be the nities for all relevant mangers to be involved basis of improved performance and contin- in the development activity. uing development for future corporate com- It should be particularly noted that the munication activities. They believed that the frameworks proposed are not prescriptive of profile related most easily to specific and any particular course of action and the profile

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 is an assessment tool. The resulting analysis tion but a negative one. The assessment pro- 2 does not suggest a particular strategy but may file proposed makes no attempt to measure 3 be used to formulate both strategies and tac- these effects or to justify the value of integra- 4 tics in a focused way by concentrating on tion. The ICC profiling approach proposed is 5 areas of most need. ‘process’ driven, not outcomes driven. This 6 The chapter is predicated on the presump- is seen as the most practical and appropriate 7 tion that integration of corporate communica- approach to adopt to assess integration. 8 tion is a good thing which can offer the However, managers may make use of relevant 9 benefits of synergistic effect. Importantly, ‘output’ performance measures in determin- 10 it was recognized that a lack of integration is ing their responses to each of the dimensions 1 likely to have dysfunctional consequences. and may seek to highlight particular sub-areas 2 Lack of attention to ICC is not a neutral posi- of each dimension for this purpose. 3 4222 5 6 REFERENCES 7 8 Duncan, T. R. (1994) ‘Is your marketing communica- Morley, M. (1998) Corporate communication: a 9 tion integrated?’, Advertising Age, 64(4), 26. benchmark study of the current state of the art 20 Ehrenberg, A. S. C., Scriven, J. A. and Bernard, N. R. and practice’, Corporate Reputation Review, 2(1), 78–86. 1 (2000) ‘Advertising established brands: an international dimension’, in S. O. Monye (ed.), The Pickton, D. and Broderick, A. (2001) Integrated 2 Handbook of International Marketing Communi- Marketing Communications, Harlow: Financial 3 cation, Oxford: Blackwell, Chapter 13. Times, Prentice Hall. 4 Fletcher, K., Wheeler, C. and Wright, J. (1994) ‘Strat- Robbs, B. and Taubler, D. (1996) ‘Will creatives pre- 5 egic implementation of database marketing: vent agencies from adopting integrated market- problems and pitfalls’, Long Range Planning, ing?’, Marketing News, 30(20), 4. 6 Shimp, T. (1997) Advertising, Promotion, and Sup- 7 27(1), 133–41. Gonring, M. P. (1994) ‘Putting integrated marketing plemental Aspects of Integrated Marketing 8 communication to work today’, Public Relations Communication, 4th edn, New York: Dryden Press. 9 Quarterly, 39(3), 45–8. Schultz, D. E. (1993) ‘How to overcome the barriers 30222 Hartley, R. A. and Pickton, D. W. (1997) ‘Integrated to integration’, Marketing News, 27(15), 16. marketing communication: a new language for a 1 Schultz, D. E. (1997) ‘Integrating information re- new era’, Proceedings of the Second International 2 sources to develop strategies’, Marketing News, Conference on Marketing and Corporate 3 31(2), 10. Communication, University of Antwerp, April. Swan, A. (1993) ‘One-stop debate’, Marketing, 1 Apr, 4 Jones, J. P. (1995) When Ads Work: New Proof That 5 42–3. Advertising Triggers Sales, New York: Simon and Van Riel, C. B. M. (1995) Principles of Corporate 6 Schuster. Communications, London: Prentice Hall. 7 Linton, I. and Morley, K. (1995) Integrated Marketing Varey, R. J. (1998) ‘Locating marketing within the 8 Communication, Oxford: Butterworth Heine- corporate communication managing system’, 9 mann. Journal of Marketing Communication, 4(3), Meffert, H. (1979) Praxis des Kommunikationsmix, 40 177–90. Münster: BDW. Varey, R. J. and White, J. (2000) ‘The corporate com- 1 Moriarty, S. E. (1994) ‘PR and ICC: the benefits of munication system of managing’, Corporate 2 integration’, Public Relations Quarterly, 39(3), Communication: An International Journal, 5(1), 3222 38–45. 5–12.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors White, R. (1997) ‘Shouldn’t we be assessing the effec- Wolter, L. (1993) ‘Superﬁciality, ambiguity threaten tiveness of total communication campaigns IMC’s implementation and future’, Marketing rather than individual techniques?’, International News, 27(19), 12–13. Journal of Advertising, 16, 118–22.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 15 2 3 4 New technology and the changing face 5 6 of corporate communication 7 8 Martin Sims 9 10 1 2 3 4222 5 How often have corporate communicators heard the mantra that the information high- 6 way will change core businesses like never before and that contact with stakeholders will 7 allow instant access and the possibility of real time information exchange if not quality 8 symmetrical communication? 9 In this chapter the author looks at these and other issues relating to the question 20 of whether new technology is changing the face of classical corporate communication. 1 He challenges some of the current tenets of ICT by balancing out the practicality of the 2 new technologies against traditional media formats, such as print, and reflecting on 3 the professional role carried by corporate communicators. 4 5 6 7 8 9 Every year spending worth billions of pounds ‘The internet changes everything’ was a 30222 is based on our assumptions about new common cry during the dot.com boom, 1 information and communications technolo- usually as an opener to claims that this new 2 gies. Outlay on software and hardware to technology would turn the business world 3 increase business efficiency is just part of this. upside down. Three years after the bursting of 4 New information and communications tech- the internet bubble, most of the fêted 5 nologies (ICTs) play a role in social change and dot.com ‘pure plays’ have collapsed and the 6 so our assumptions about their effects are a biggest sites on the net are owned by familiar 7 main plank of forming long-term corporate names like BBC and AOL Time Warner. 8 strategies. How many times have you heard ‘People want interactivity’ is an assumption 9 things like: ‘find new ways of reaching our which has underpinned much recent debate 40 stakeholders’; ‘brands are under threat as about the digitizing of communications 1 never before’; ‘corporations are at the mercy technology: the idea being that the way 2 of special interest groups’; or ‘we can now talk people want to communicate has changed. 3222 directly to customers’? The argument is that technological change has

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors demassiﬁed the mass media: the one-to-many So what are the implications of devel- model of broadcasting is slowly but surely opments in ICTs for the PR professional? The being replaced by video on demand.1 Con- answer is a complex one. It is rare for the sumers are active, individuals want to be power of technological change to force society empowered: people want to choose what in one direction only. Human beings are com- they watch and they want a two-way relation- plex animals, actions have reactions that make ship with it. In fact, in Europe and the United the end result hard to predict. In the 1960s States the utterly non-interactive national the satellite era gave birth to MacLuhan’s terrestrial TV networks continue to deliver the dreams of a global village. In technological sort of audiences satellite, cable or the inter- terms that is closer than ever, but have the net can only dream of. The tragedy of modern nations and regions of the world become politics is that people do not want interactivity. more intimately connected or are they more Across the western world countries report a inward looking? The answer is probably both, decline in voter turnout and in membership of globalization as we now call it having con- political parties. In this most crucial area fewer tributed to political and national insularity people are demanding the two-way relation- and facilitated greater international inter- ship which would give them greater control action. Let us examine some of the common claims about the effects of new ICTs in detail. over their own lives. Implicit in all these arguments are simplistic assumptions about the effects of new ICTs, Empowering the individual? often put forward by less than disinterested parties. Has the balance of power changed between the individual and the corporation, between big organizations and small organizations or One cause or many? between the individual and the state? The most common argument is that the nature The most common problem is to assume that of new ICTs has changed the relationship by new communications technology is the sole or putting more power in the hands of the indi- at least major cause of social or behavioural vidual. Take for example someone seeking change. As many academics have pointed out information about the health risks associated this is not a simple cause and effect relation- with radon, a gas released naturally from ship between the two, but a complex inter- certain types of rocks. Until the advent of the 2 twining of factors. Gutenberg’s invention of internet he or she would have had to wait for the printing press did not singlehandedly information to appear in a newspaper, maga- bring about the Reformation, but it was an zine or on the broadcast media. Otherwise important factor, along with wider political they would have to go to a library to search and social change.3 With the technology out a book on the subject. With the internet boom behind us and the internet as a com- it is much easier for individuals or small mercial medium now past the toddler stage groups to get their views into the public many of the visionary’s claims have been domain. An internet search will generate a tested by human experience and deserve a wealth of material, though not all of it may be measured reassessment. reliable.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 However, there are also strong arguments that news coverage is moving away from 2 in the opposite direction: that new ICTs have serious consideration of policy issues towards 3 empowered the state and corporations at the a tabloid obsession with celebrities, ignoring 4 expense of the individual. The increasing international news in favour of domestic 5 sophistication and integration of databases, news. All the evidence suggests that the inter- 6 which now contain a mass of information on net has not revolutionized media consump- 7 everything from credit history and medical tion but rather built on existing patterns of 8 information to TV viewing has made individ- behaviour. A combination of cross-promotion, 9 ual behaviour open to state and corporate the enormous power of the existing media 10 scrutiny in a way unimaginable some thirty and the search for trust in a environment of 1 years ago. Mobile phone technology means limitless choice means the ‘old’ media domin- 2 that for the first time very accurate positional ate the ‘new’ media: the UK’s most popular 3 data is available for every caller. The internet site is that of its most popular broadcaster – 4222 offers immense possibilities for surveillance. the BBC. 5 The US government spent $34 billion on the To summarize: the internet empowers 6 Information Awareness Office, which aims to those with a desire to find out. By itself it does 7 improve national security by using the surveil- not motivate people. The urge to find out 8 lance possibilities of the internet and other more or to campaign on a particular issue 9 new ICTs.4 Wanting to make use of these new comes largely from the same real world im- 20 sources of information for national security or petuses as ever: personal experience, friends, 1 crime prevention is a common reaction for family, interaction through clubs, unions or 2 governments and can been seen in the United political parties, and what we hear, see or read 3 Kingdom in the Regulation of Investigatory in the mainstream media. If you are already 4 Powers Act (2000).5 a shareholder in corporation X, or are an 5 6 So there is a potential to both empower environmental activist in a field in which corp- 7 the individual and diminish their privacy and oration X operates, the internet usually gives 8 liberty. In practice empowerment is subject you access to much more information. If you 9 to several qualifications. First, individuals are have never heard of corporation X the wealth 30222 only empowered if they have a desire to find of online information is unlikely to have any 1 something out. It is tempting to imagine that effect. 2 with all that information at our fingertips we In practice, for PR professionals this 3 must be inexorably moving towards a society means that putting information on a corpor- 4 where people are increasingly holding govern- ate website, desirable though this may be in 5 ment and corporations to account and where terms of transparency, has next to no effect 6 the barriers to humans’ thirst for knowledge, on the population at large. It will be seen 7 creativity and personal development have by those who have a connection with the 8 finally been removed.6 Sadly this optimism is organization (whether as enemies or friends) 9 misplaced. but it will only get through to the general 40 Developments in ICTs have been accom- public if it is picked by journalists from the 1 panied by other social developments which ‘traditional’ media, for it is the ‘tradi- 2 tend to work in the opposite direction. tional’ media which dominate the online 3222 Political participation is declining; many argue world.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors An accurate picture of social trends is vital if Putting the internet in perspective PR professionals are to strike the right tone and adopt effective long-term strategies. Access to communications clearly affects Although the most common reaction in the wider social power structures, though it cer- developed world has been to emphasize the tainly does not determine them. We need a potential of new ICTs for individual empower- measured assessment of how technologies ment, there has been mounting public con- have tipped the balance. cern about attacks on civil liberties. In the Twenty years ago Tomita argued that there developing world a common reaction has was a ‘media gap’ (see Figure 15.1). The been concern about the potential of new ICTs broadcast media provided almost instan- to further increase the gap between rich and taneous communication to large groups of poor nations. It is more fruitful to think of the people (10,000+); the telephone gave in- relationship between the individual and state stant communication between individuals; or corporations as having changed in several printed media, from letters to newspapers, ways rather than having shifted in one direc- allows everything from one-to-one to one-to- tion only. The emphasis then becomes millions communications but with a signiﬁ- redrawing rights and responsibilities to take cant time delay, varying from a day to a account of the changed circumstances.7 month. The gap is for quick communication to

TOMITA’S MEDIA GAP

Books Movies 1 month 1,000,000 Newsletters Letters Magazines 1 week 100,000 Newspapers

1 day 10,000

1,000 The Media Gap

100 1 minute Time delay (in seconds) 10 Radio Telephone Television 1 Conversation

1 10 100 1,000 10,000 100,000 1,000,000 Audience size

Figure 15.1 Tomita’s media gap Source: Adapted from The Future of the Mass Audience, W. Russell Neuman (1991)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 smaller groups of people, i.e. from tens to tens the price of a computer and an internet con- 2 of thousands. nection an individual could send emails and 3 This gap has been filled by websites, email create a basic website using free software 4 and to a lesser extent other new technologies and free server space. Professional web 5 like bulk SMS messaging and telephone and design software costs a few hundred pounds 6 fax broadcasting (sending the same recorded and your own web address and server space 7 or written message to many people). How- can be bought for less than a hundred 8 ever, to get the full picture it is necessary to pounds. At the most basic level an individual 9 consider another characteristic of the different can disseminate information for a one-off cost 10 communications channels – their cost. of less than a thousand pounds – much 1 cheaper than the ongoing costs associated 2 with printing. 3 The cost of communicating However, it is often mistakenly assumed 4222 that the low cost of basic web production 5 Broadcasting is expensive, requiring expensive means anyone with a home computer can 6 infrastructure, technology and many person- create a site to rival the BBC or Amazon. 7 nel. Printing is also expensive, though owning Simple sites may be cheap but large complex 8 a printing plant is not a necessity this is bal- sites are every bit as expensive as the tradi- 9 anced by the high costs of distribution. tional media. Sites which compile lists of users 20 Writing in February 2003 in the United or restrict access by the use of unique pass- 1 Kingdom the bare minimum cost of profes- words require integrated databases which 2 sionally printing and distributing a subscrip- greatly increase the design costs. In the United 3 tion-based black and white 40-page magazine Kingdom quotes for sites with this sort of func- 4 to 1,000 people was £2000 per issue.8 At the tionality currently start at £10,000, and cost 5 cheapest end of the market this is outside the far more during the dot.com boom.10 6 scope of many organizations, certainly on a Furthermore, the technical characteristics of 7 regular basis and without advertising support. websites mean unlike broadcasting there is a 8 At the other end of the scale the cost of significant marginal cost. The costs for a radio 9 national newspapers is well known, Of the station are exactly the same whether they 30222 United Kingdom’s two most recent market broadcast to one person within their coverage 1 entrants one of the world’s richest media area or one million. But with websites adding 2 moguls, Rupert Murdoch, was unable to bring users increases the costs, most significantly if 3 Today, a middle-market tabloid with hundreds we are talking about creating a mass audience 4 of thousands of readers, into profitability and site with millions of hits. It requires a higher 5 avoid its eventual closure. The Independent bandwidth connection to the internet back- 6 struggles from crisis to crisis and from rescue bone and larger numbers of more powerful 7 bid to rescue bid, despite both newspapers servers running more expensive software.11 8 employing the latest technology and having For the managers of big websites the number 9 the resources of large media groups to fall of users who can access the site without it 40 back on.9 crashing – particularly during national emer- 1 Not only do websites and email allow near gencies like 9/11 – is a matter of great pride 2 instant communication with smaller groups, and testament to the site’s expensive technical 3222 they also bring a huge cost reduction. For only capabilities.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Neither can it be forgotten that the media Table 15.2 Top 10 UK web properties is a labour intensive industry and for an enterprise of any size this is equally true of web- Property Unique sites. Even the smallest local paper requires audience at least a couple of journalists, as would a 1 MSN 8,750,554 small magazine-style website, but it would 2 Yahoo! 6,959,887 also need IT staff, as do printers and news- 3 Google 6,737,921 4 Microsoft 5,726,141 papers. The United Kingdom’s biggest site, 5 AOL Time Warner 5,568,160 www.bbc.co.uk, reportedly employs 200 6 Wanadoo 5,067,551 people and cost £100 million in 2002,12 but 7 BBC 4,762,173 the true figure would be much higher if it took 8 British Telecom 4,454,923 into account the cost of sourcing the material 9 Amazon 4,188,153 it recycles and repurposes from BBC radio and 10 eBay 3,995,562 television. Source: Nielsen//NetRatings Audience Measurement Service, January 2003 Table 15.1 Top 25 US web properties by parent company The economics of the internet reinforce the ‘media gap’ theory – websites and email are a Parent Unique audience highly cost-effective way of communicating with relatively small numbers of people but 1 AOL Time Warner 76,353,004 once audience numbers reach hundreds of 2 Microsoft 72,891,223 3 Yahoo! 66,217,672 thousands or high functionality is required, 4 Amazon 28,115,562 then costs spiral. It is also important to note 5 Google 27,863,289 that websites and email can communicate 6 eBay 27,120,841 internationally as easily and cheaply as 7 Terra Lycos 22,999,754 nationally (Tables 15.1 and 15.2). 8 RealNetworks 22,805,779 9 United States Government 21,694,762 10 About-Primedia 21,004,816 Assessing the effect of ICTs 11 Viacom International 15,022,286 12 eUniverse 14,935,148 The internet has made little impact on the 13 Walt Disney Internet Group 14,688,910 economic realities which shape the mass com- 14 USA Interactive 14,624,792 munications landscape. As a way of reaching 15 Sharman Networks 13,519,847 16 CNET Networks 12,604,100 national audiences of hundreds of thousands 17 Landmark Communications 11,716,856 there is no significant cost saving over the ‘old’ 18 Apple Computer 11,669,656 media. It is unsurprising that the most popular 19 Classmates 11,145,862 sites in most countries are run by either big 20 InfoSpace Network 10,983,618 companies like Microsoft or national telecoms 21 AT&T 10,523,768 providers; or well established media organiza- 22 The Gator Corporation 10,000,792 23 EarthLink 9,459,880 tions like the BBC or AOL Time Warner. These 24 American Greetings 8,710,937 are complemented by start-ups like Yahoo! 25 Wal-Mart Stores 8,645,168 and Google who had sufficient funding and a

Source: Nielsen//NetRatings Audience Measurement Service, good enough product to challenge the big December 2002 boys. Mass communication continues to be

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 dominated by a handful of huge companies Rumours can fly at lightning speed via email 2 and is likely to remain so. and receive unwarranted global credibility via 3 The implication for PR professionals is that swiftly constructed websites. Mobile phones 4 the internet has changed little in terms of dis- have allowed protest groups to organize with 5 seminating a message to a mass audience. The unprecedented efficiency. Pictures and video 6 only effective way to get a message across to can now be sent around the world in a way 7 non-specialist audiences in the tens of thou- that only the richest broadcasters could afford 8 sands and above is the traditional print and ten years ago. 9 broadcast media. Even for specialist audiences However, there is a tendency to accept 10 a trade or special interest publication and its these assertions without question: ICTs are 1 associated website is still likely to be the best usually a double-edged sword. It is easier and 2 channel, though there are a few examples of cheaper to organize small campaign groups 3 online magazines which are leaders in their but it is also easier and cheaper for corporate 4222 field: http://www.drudgereport.com/ for US bodies to monitor these groups and develop 5 political exclusives and www.popbitch.com their own relationship with stakeholders. 6 for showbiz gossip in the United Kingdom. Well-funded corporations that prioritize stake- 7 Disseminating information via the internet holder relations should be in at least as strong 8 will never have the same impact as traditional a position as any campaign group. 9 mass media relations. If the internet has given a new credence to 20 Where the internet can have a marked unsubstantiated rumour and implausible con- 1 effect on corporate communication is in spiracy theories which previously only circu- 2 utilizing its ability to communicate quickly lated via word of mouth is this necessarily a 3 and cheaply with relatively small numbers of bad thing? Is open public dissection of these 4 people, i.e. in the low tens of thousands and rumours better or worse for public bodies? It 5 below. To return to the earlier example, a leads to many being disproved, like claims 6 developer who built houses in an area where that an airliner which crashed in the Atlantic 7 the rock is known to release large amounts of had been hit by a stray US missile. When these 8 radon could achieve a great deal by setting up rumours are examined by the mainstream 9 a website which provides the latest informa- media it gives corporates the chance to put 30222 tion about whether the gas is harmful. A large their case in a reasonably fair fight, and when 1 company is likely to have the resources to pro- the rumours exist only on message boards or 2 duce a more comprehensive and regularly websites it is often easy to have them 3 updated site than small groups of campaign- removed. In the United Kingdom ISPs are so 4 ers. Add to this an email blitz directed at afraid of being sued that most remove post- 5 people who have expressed interest in buying ings as soon as there is a complaint, much to 6 the properties and you have a cost-effective the alarm of free speech campaigners. 7 campaign, though one that would need to be However, the speed of current communica- 8 complemented by coverage in the local media. tions does mean that crises can flare very 9 quickly. Perhaps the best strategy is to be 40 Brand and reputation proactive, as Hayes has argued: ‘Organisations 1 that wait for issues to occur before managing 2 It is often said that new ICTs have made corp- their communications with key stakeholders 3222 orate brand and reputation more vulnerable.13 often end up with a crisis on their hands.’14

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors There is a paradox here: as well as making short video clip. Equally, imagine how difficult brands vulnerable to attack, the internet has it would be to overcome public resistance to also strengthened them. In an almost limitless disclosing personal information like your loca- universe of information, much of it unreliable, tion at a given moment. with always a danger of fraud, invasion of pri- Interactive television is another developing vacy or offensive content, people naturally medium, which uses digital television’s return seek out trusted and reliable sources from the path to allow viewers to access ‘microsites’. offline world. Hence the success of big media These are similar to websites. They potentially organizations and of familiar names like Wal- overcome some of the limitations of TV adver- Mart. So what has been taken with one hand tising – the inability to offer detail, difficulties has been given with the other, weighing the in measuring the success of the campaign and balance is practically impossible. the lack of opportunity to collect information about viewers. The most successful interactive adverts have included offers like the chance to New ways of reaching the public book a test drive for a new car. The initial buzz of enthusiasm for this technology has given Scepticism about the impact of new ICTs is way to disappointment about its effective- essential because the field is over-hyped. ness, but these are early days and the prospect Computing, telecoms and technology com- of adding to the capabilities of the most panies have huge marketing and PR budgets powerful medium could be very attractive to dedicated to talking up the potential impact PR professionals. of ICTs. Those who talk down the impact or The internet is certainly having a growing argue for a measured assessment have no impact and is becoming ubiquitous in work budget at all and are mainly quite isolated and education. The online advertising agency academic voices. In fact the general mood in i-level say the internet’s share of all media academia has followed the wave of enthusi- consumption by the average adult in the asm for all things web related. United Kingdom is about 7 per cent – impres- This article has looked at the evidence for sive for such a young medium.15 It will cer- dramatic change so far, this is not to say that tainly become more relied upon as an great changes in communications patterns information source, but whether that means may not emerge over the next decades. This most people will simply go to the same main- can happen very suddenly, as we saw in stream media online rather than offline is a Europe with text messaging (or SMS), and moot point: whether the balance of power there are many more technological possibili- between individuals and institutions will ties to be explored. Marketing using the very change significantly is dependent as much on accurate positional data captured by mobile economics and wider social change as on phones is a fascinating prospect, and one that technology. It also depends on human nature mobile companies may be pushed towards if – do we have a limitless capacity for interac- their margins continue to fall. Imagine being tion, choice and finding out for ourselves, or able to alert people walking past a renovated do most of us, most of the time, want the park that this was paid for by a corporate sort of entertainment which currently domin- social responsibility programme. Moreover, ates the TV schedules? The growth of the 3G networks would even be able to send a internet and the gradual increase in multi-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Figure 15.2 2 The changing face of Coca- Cola: a poster from 1931 and 3 an interactive TV advertising 4 campaign from 2001. (Photos 5 courtesy the Coca-Cola 6 Company and Respond TV) 7 8 9 10 1 2 3 4222 5 6 channel penetration in the developed world corporations. This is reason enough for organ- 7 suggests the former, but the continued domin- izations to embrace these new technologies 8 ation of the terrestrial TV networks suggests and the multiple possibilities for dialogue 9 the latter. with stakeholders which previously would 20 This chapter has often qualiﬁed and down- have been impracticable. Success in the new 1 played claims about the social impact of ICTs, media environment depends on trust because 2 but there is no doubt that they are agents of it involves access to increasingly personal 3 change to a greater or lesser extent, and some information. Institutions must seize every 4 of these changes are potentially damaging to opportunity to build that trust. 5 6 NOTES 7 8 1 One of the earliest versions of this argument is 8 Printing costs in the UK are approx. GBP 1400 9 Gilder, G., Life after television, New York: W. W. and distribution GBP 700 at 70p per copy. Based 30222 Norton, 1994. on quotes received in 2002 for the printing of 1 2 See inter alia Williams, R., Television, Tech- the IIC’s journal, Intermedia. 2 nology and Cultural Form, London: Fontana, 9 See Curran, J. and Seaton, J., Power without 3 1974. Responsibility, fifth edn, London: Routledge, 3 For an explanation that gives this debate the sub- 1997, pp. 101–5. 4 tlety it deserves see Briggs, A. and Burke, P., 10 A complicating factor is that the cost of comput- 5 A Social History of the Media, London: Routledge, ers, web design and web hosting is coming 6 2002, chapter 2. down. Design software is becoming increasingly 7 4 See Beckett, R. and Rogerson, S., ‘E-democracy, sophisticated allowing non-experts to add 8 rights and privacy in the age of information’, increasing functionality to their sites. However, 9 Intermedia, March 2003. the gulf between a home designed site and a 40 5 See www.ﬁpr.org/rip/ for a summary of (mainly professionally designed and well-funded site critical) press and public reaction. remains marked and is likely to remain so. 1 6 An argument made by Gilder (1994). 11 For more details, see Wessberg, A., ‘Challenges 2 7 The Beckett and Rogerson article above is a good and opportunities in the internet age’, Inter- 3222 introduction. media, April 2001.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 12 BBC Annual Report 2001/2 Notes to the 14 ibid. Financial Statements http://www.bbc.co.uk/info/ 15 ‘Sizing up the web’, Guardian 20 Jan. 03. report2002/pdf/facts_ﬁnance_notes.pdf 13 See among others Hayes, R., ‘The importance of crisis management’, Intermedia, Sept. 2001.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 PART III MANAGING IMAGE, IDENTITY 4 AND REPUTATION 5 6 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 16 2 3 4 Reputation and leadership in a public 5 6 broadcast company 7 8 Sandra M. Oliver and Anthony Clive Allen 9 10 1 2 3 4222 5 In this chapter, the concepts of image, identity and reputation are explored theoretically 6 through Grunig’s excellence model prior to addressing them in relation to the case of 7 the British Broadcasting Corporation (BBC). Three issues illustrate public perception 8 of this organizational icon: the statutory licence fee; the use of infotainment trails; and 9 employee responses to a former director general’s memoirs. While all three issues have 20 come together in the United Kingdom to present a national debate about public broad- 1 casting per se, it is outside this chapter’s frame of reference to discuss issues of state 2 propaganda and control. What is of interest for best practice, is whether or not an organ- 3 ization such as the BBC, with its well established worldwide reputation developed over 4 5 many years, can be eroded or indeed stand up to today’s vigorous but democratic public 6 debate and challenges from diverse stakeholders at home and abroad, including govern- 7 ment, journalists and employees alike. 8 9 30222 1 From its beginnings in 1922 as the United work within which the corporation operates. 2 Kingdom’s first domestic broadcaster the BBC The BBC’s remit has always been to ‘inform, 3 established itself as one of the leading inter- educate and entertain’ by providing a mixed 4 national media players, first with the World schedule of high quality programmes to the 5 Service Radio and more recently with tele- population as a whole (Birt, 2002). As such it 6 vision channels such as BBC World or BBC has been responsible for providing a model of 7 Prime. As a public corporation the BBC has public service broadcasting which has had a 8 always been formally independent of govern- far-reaching influence at home and abroad. 9 ment, and to this day its main source of rev- The BBC has built its global reputation above 40 enue is a licence fee payable by everyone who all on the fairness, impartiality, accuracy and 1 owns a television set. However, the level of authority of journalism. But its output extends 2 the licence fee is determined periodically by far beyond simply news programmes to cover 3222 parliament, as is the general regulatory frame- all categories of programming and various

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors modes of delivery – it supports amongst other has provided its critics with yet more ammuni- things, two national analogue television chan- tion. It has also done little to restore the low nels, one international, five national, three morale of many staff resulting from the national and thirty-nine local radio stations, management culture of the 1990s. a range of digital television channels and In recent years UK television broadcasting 600,000 pages on BBC online, (the most visit- organizations have increasingly come to reed non-portal website outside the United alize the importance of building relationships States). Today the BBC is one of the best- with their various stakeholders. The reasons known media brands in the world. (‘It’s for these changes are not hard to find. Creative Darling’, Internal Communications Technological developments, an increasingly Practice at the BBC, 2001). deregulated media environment and fiercer Yet this venerable institution still has its competition for audiences, advertisers and critics. Even before the advent of the digital staff, have challenged much of the world the age criticism had been growing over the fund- UK media once operated in. ing of the organization and in particular the Before the advent of satellite broadcaster principle of the licence fee. Most vocal have BSkyB in 1989 there were just four UK terres- been the BBC’s media competitors, notably trial channels (two run by the BBC) plus a by newspapers owned by Rupert Murdoch’s small number of moderately successful cable News International, which also has a 40 per stations. In the intervening period satellite cent stake in BSkyB, the subscription based and cable penetration has been substantial: satellite broadcaster and direct competitor to in 2001, nine million households had dom- the BBC. Many politicians have also con- estic dishes and connected cable out of a total demned the licence fee as a regressive tax of 23 million homes (Media Week). Digital (Sunday Times, 20 October 02) and even jour- technology capable of offering hundreds of nalists are jumping on the bandwagon crying channels of viewing has been available since for reform (Guardian, 7 November 02). With 1998, further fragmenting audiences, and it is the emergence of the third age of communi- expected to replace analogue services before cation (Blumler, 2001), e.g. the explosion of 2010. This is the environment that the BBC new digital channels, commercial and political now operates in. groups are asking the question ‘Why should In this competitive age in which the BBC the BBC continue to be treated as now finds itself, its stakeholders are increas- a special case?’ ingly faced with a plethora of alternatives to Critics both inside and outside the BBC cite the BBC. In such a competitive market, it is the corporation as being overstaffed, bureau- clear that any stakeholder’s decision to sup- cratic and out of touch (Sunday Times, 3 port the BBC will only be successful if they November 02). Even the BBC’s chairperson, identify positive reputation of the corporation Sir Christopher Bland, in the corporation’s through the corporation’s image of an organ- annual report said: ‘We must be more open ization producing quality services and identi- and accountable, finding better ways of inter- fying that quality with value for money. acting with the public’ (BBC Report, 2000). Knowing that a strong identity has a number In recent years the BBC’s high-profile loss of potential benefits for an organization, e.g. of broadcasting talent and sporting rights to adding value, generating consumer confi- commercial rivals, e.g. Match of the Day to ITV, dence and loyalty, stimulating investments,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 attracting high-quality personnel and breed- audiences (Bernstein, 1992). Corporate image, 2 ing employee motivation (e.g. Balmer, 1995; in other words, describes the reception of an 3 Van Riel, 1995; Van Riel and Balmer, 1997) organization in its surroundings (Christensen 4 in-house communication specialists have and Askegaard, 2001). 5 always sought to keep the issue of identity on Identity, however, is the visual manifesta- 6 the board agenda and PR budgets. Moreover, tion of image as conveyed through the organ- 7 with growing journalistic attention and ization’s logo, products, services, buildings 8 increasing critique of private business corpo- and all other tangible bits of evidence created 9 rations by various interest groups, organiza- by the organization to communicate to its 10 tions have recognized and costed the price of various stakeholders (Argenti, 1998). Some 1 developing a socially responsible, ergo a posi- researchers see these definitions as opposite 2 tive, corporate image. But what is organiza- ends of the same communication process 3 tional image? Or organizational identity? How (Margulies, 1997). Others suggests that iden- 4222 do these terms interrelate to present a meas- tity is what is created and sent from an organ- 5 ured view of a corporation’s reputation? ization to its external world, with image as 6 something which emerges outside of the 7 organization’s boundaries and is eventually Identity and image 8 ‘sent’ back to the organization via external 9 analysis (Stacks, 2002). This perspective is 20 In spite of the growing attention given to seen in models that depict the interplay 1 identity and image there is no definitive defin- between corporate identity and corporate 2 ition for these pseudo-psychological terms. image to the extent that they allow some 3 Identities and images are volatile social con- overlap between different audiences (Balmer, 4 structions that, although seemingly ‘objec- 1995). Today, however, the dividing lines are 5 tive’, base their existence and significance 6 largely on the interpretative capabilities and becoming more blurred between senders 7 preferences of their audiences (Christensen and receivers of messages and, consequently, 8 and Askegaard, 2001). Although literature a clear distinction between inside and out- 9 abounds with different definitions of corpor- side organizational boundaries is increasingly 30222 ate image and corporate identity, there are problematic to uphold. Employees, for in- 1 some commonalities. We find a sense of con- stance, interact with ‘outsiders’ and are also 2 vergence around the idea that corporate members of external groups that encounter 3 identity is a set of symbolic representations, organizational symbols in their lives outside 4 sometimes organizational behaviour (Abratt, their workplace. It is this partial inclusion 5 1989; Van Riel and Balmer, 1997). Corporate within organizations that arguably has led 6 identity can then be seen as an assembly of to organizations recognizing that workforces 7 clues, or as Abratt (1989) puts it: ‘by which also belong to multiple memberships of 8 an audience can recognise the company and groups within the workplace that form 9 distinguish it from others and which can be impressions of the organization, a fact that 40 used to represent or symbolise the company’. has been explicitly recognized in the consoli- 1 On the other hand, we find corporate image dation of corporate communications functions 2 typically viewed as the total impression of in a number of industries (Cheney and 3222 an organization that it makes on its various Christensen, 1999).

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Conversely, and of equal importance, many attribute of an entity . . . based on its willing- organizations have come to realize that organ- ness to perform an activity repeatedly in a izational practices which traditionally have similar fashion’. been thought of as strictly internal, e.g. organ- However, like image and identity and des- izational structure, use of resources, ethical pite numerous attempts at semantic and issues and the practice of leadership are meaningful clarification, there remains no now becoming themes in public discourse, unambiguous definition of corporate reputa- and thus become part of the communication tion acceptable to the communication indus- that the organization, sometimes unwillingly, try. The term is defined in the Oxford carries on within its surroundings. When dictionary as ‘what is generally said or customers start boycotting organizations that believed about a person or thing’, but over function according to unethical principles the years, practitioners and writers have and when employees begin choosing their adopted different, sometimes even contradic- workplace on the basis of its reputation in tory, definitions for corporate reputation society traditional distinctions between inter- (Gotsi and Wilson, 2001). Academics such as nal and external with respect to identity and Fombrun and Van Riel emphasize the effects image break down in terms of stakeholder of this ambiguity, by suggesting in their writ- theory (PC) and mass communication theory ings that the lack of a single common defini- (audiences) (Cheney and Christensen, 1999). tion explains partly why although corporate Indeed, the actions and statements of top reputations are ubiquitous, they remain rela- managers simultaneously affect organiza- tively understudied. Many early writers con- tional identity and image (Hatch and Schultz, centrated on the concept of corporate image 1997). in a way that appears synonymous with corporate reputation. Martineau (1958) regarded the term image as the sum of functional qual- Reputation ities and psychological attributes that exist in the mind of the consumer, while Boulding The rationale for acquiring a favourable corp- (1973) defined image as subjective know- orate reputation is that it is likely to mean that ledge. Later, writers like Dowling (1993) and an individual is more predisposed to buy a Dichter (1985) saw the terms corporate image company’s products or services (Van Riel, and corporate reputation as identical, defin- 1995) or as Fombrum (in Argenti, 1998) ing image as ‘the total impression of the states, ‘Reputation is a source of competitive company’. Finally, Ind’s (1997) definition advantage.’ Equally, a well-managed and of corporate image as ‘the picture that an carefully nurtured corporate reputation can audience has of an organization through the be stored over time to the extent that banked accumulation of all received messages’ illus- goodwill cushions the adverse consequences trates that the author sees no distinction of bad publicity (O’Rourke, 1997), a view between the term corporate image and corp- supported by research in reputation which orate reputation. often emphasizes the historical nature of rep- Recently, several authors (Balmer and utation formation. Herbig and Mulewicz Greyser, 2003; Grunig et al., 2002) have (1995), for example, define reputation as the considered the terms corporate reputation ‘estimation of the consistency over time of an and corporate image as separate concepts

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 whereby organizations should be focusing on whilst Hickman and Silva (1984) suggest 2 the management of corporate reputation and that each organization creates its own unique 3 not of corporate image: when, for example, criteria for excellence and then suggest how 4 Scott Cutlip says ‘We in PR must be concerned leadership can help the organization meet 5 with that good, old fashioned word reputa- those criteria. However, no one set of criteria 6 tion – not image’, he fails to consider key can be used to identify every effective organ- 7 monitoring and control factors such as critical ization (Grunig and Hunt, 1984). As a result, 8 path analysis and integrated programme eval- excellence in management may produce 9 uation. different results, for each organization defines 10 Generally, it is accepted that the concepts its own criteria for success. In Grunig’s excel- 1 of reputation and image are interrelated and lence model (1984) he went much further, 2 that there is a dynamic relationship between suggesting twelve factors that contribute to 3 the two, even if measurement is difficult as, the excellence of an organization to include: 4222 for example, in Gotsi and Wilson’s (2001) human resources (HR); organic structure; 5 statement . . . ‘A corporate reputation is a intrapreneurship; symmetrical communica- 6 stakeholder’s overall evaluation of a company tion systems; leadership; strong, participative 7 over time. The evaluation is based on the cultures; strategic planning; social responsibil- 8 stakeholder’s direct experience with the com- ity; support for women and minorities; quality 9 pany, any other forms of communication and as a priority; effective operational systems; a 20 symbolism that provides information about collaborative societal culture. These factors 1 the company’s actions.’ were standard practice in UK-based multi- 2 national organizations in the 1960s and 3 1970s. No strategic PR plan would have got 4 Towards excellence through the board had any factor been miss- 5 ing. The importance of the excellence model 6 Grunig et al. call their theory of best practice lies in its aid as an industry focus, if not a uni- 7 the Excellence Model. But like perceptions of versal standard. 8 identity, image and reputation, how is excel- In this study of the BBC, Grunig’s factors 9 lence defined, particularly in relation to an of excellence are interrelated with definitions 30222 organization? Before Grunig et al.’s study there of image, identity and reputation through the 1 were various attempts at defining excellence context of three specific issues namely, the 2 depending on the context. Hobbs (1987) licence fee; the use of commercial trails by 3 identified excellent companies by measuring the BBC and the impact of the memoirs of the 4 return on sales and return on owner’s invest- former director general of the BBC to see how, 5 ment. However, Carroll (1983) criticized the or if at all, the BBC could be said to be func- 6 use of financial measures for identifying excel- tioning as an ‘excellent’ organization. 7 lence in management by pointing out that The importance of building relationships 8 factors such as proprietary technology, market through their various stakeholders has increas- 9 dominance, control of critical raw material, ingly exercised the hearts and minds of the 40 and national culture and policy also affect BBC as the arrival of digital technology offers 1 financial performance regardless of the excel- yet more opportunity and threat for fragmen- 2 lence of management. Kanter (1989) on the tation of audiences. Furthermore, changes to 3222 other hand defines excellence as innovation, the United Kingdom’s regulatory framework

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors open up new competitions in what were once tributed to the suicide of a notable govern- safe markets; and stiff competition from inter- ment scientist. net computer games and radio challenges the The British statutory licence fee invokes BBC to prove that it is capable of delivering strong feelings. Sir David Attenborough, in excellence in all its activities throughout the an article in the Independent newspaper organization. How one national institution (November 2002) said, ‘the licence fee is the like the BBC is orchestrating its response to a key to important broadcasting, almost every- changing environment is worthy of longitudi- thing you can think of that you and I admire nal studies that require deeper analysis over about the BBC is due to the fact of the licence a longer period of time than this chapter fee’. However, this view is contradicted by a allows. With the proliferation of academic poll conducted by the Daily Telegraph newspa- courses, it will be an inevitable research devel- per in which more than half the people polled opment. believed the licence fee should be abolished (BBC News website). In the year to March 2001 the BBC earned £2.533 billion sterling The licence fee from the licence fee – a sum substantial enough to explain perhaps why the BBC is Unlike most commercial broadcasters the BBC keen to continue its funding through a licence has neither advertisers nor shareholders with fee (Guardian, 22 July 2002). So funding whom to concern itself. Its principal stake- too has been a key issues with its stakeholders holder groups are its viewers and listeners in respect of image and reputation for excel- who as licence fee payers also provide over lence. 90 per cent of the corporation’s income. The licence fee is periodically reviewed by parliament as is the BBC’s charter, the legal basis Corporate trails as infotainment by which it operates. A second key stakeholder is therefore the government of the day One of the best examples of relationship and politicians more generally. The constitu- building concerns what is being called corpor- tional position of the BBC virtually guarantees ate trails. Corporate trails are generally pro- that relations between it and government will grammes that are longer in length than a be difﬁcult at times. During the 1980s, for television commercial but briefer than a short instance, when Margaret Thatcher was prime programme. They share the same high pro- minister, the BBC came in for sustained criti- duction cost and value of a good commer- cism and was forced to accept a reduced level cial, because they compete for attention with of funding. The Blair government is less antag- these in the periods between programmes onistic. Indeed in 2000, Chris Smith, the then and because they are intended to be viewed minister in charge of culture, cited the BBC on more than one occasion. Their characteris- as ‘the UK’s important cultural institution’. In tic is to blend together a corporate message the full glare of publicity, the BBC continues with visual/aural pleasure. They may be con- to ﬁght hard to retain its reputation in the face ceptualized as a type of ‘infotainment’, blend- of its 2002 and 2003 annual reports; and its ing information with entertainment. handling of intelligence relating to Iraq and The BBC has used ‘infotainment’ to deliver weapons of mass destruction which con- the corporation’s message to stakeholders at

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 various levels of perception in an effort to An example of where the development 2 highlight the maintenance of the high stan- and production of ‘infotainment’ meets the 3 dards of programming traditionally identified criteria identified in Grunig’s Excellence 4 with the BBC. One method, taken directly Model, is the BBC’s ‘Perfect Day’ production. 5 from commercial advertising is celebrity It became one of the most successful UK corp- 6 endorsement (as seen in the latest BBC advert orate trails ever made, and was a BBC innova- 7 extolling the fact that ‘Television is Evolving’ tion concerning the corporation’s musical 8 (more precisely, BBC television is evolving)) output. ‘Perfect Day’ (1997) was a celebration 9 using celebrities from the world of art, sport, of the corporation’s public service commit- 10 music and news to present an image to the ment to the broadest range of music pro- 1 public that the BBC is ‘evolving’ into the digi- grammes (Meech, 1999). Broadcast in its 2 tal age. This message seeks to build the BBC’s full four-minute and one-minute cut-down 3 image and identity as a ‘change leader’ versions, it quickly became something of a 4222 (Kanter, 1989) in new technology together cult. It was shown originally between Sep- 5 with identifying to stakeholders the variety tember and December 1997, though sales of 6 and quality of entertainment that the BBC a CD version contributed significantly to the 7 produces. BBC’s annual national charity appeal for 8 The Excellence theory could be applied to Children in Need that year (Annual Report 9 the use of this ‘infotainment’ as an example of 1997). The concept of the trail was arguably 20 corporate PR excellence under a number of to project to the BBC’s stakeholders the image 1 headings: strategic planning, necessary to of the BBC as a champion of excellence across 2 ensure that quality is not just spoken about a wide spectrum of music, a spectrum that it 3 but that action takes place; the utilization of a could achieve only through its vast resources, 4 strong participative culture where employees paid for by stakeholders’ licence fees. The trail 5 share a sense not only of the mission but also also provided synergy between the BBC’s pro- 6 of its success. Furthermore, by utilizing motional work and its corporate social 7 women and minorities in its ‘infotainment’ responsibility work. Thus Grunig’s factor of 8 the BBC also seeks to show itself as an organ- social responsibility, in the sense that excellent 9 ization that recognizes the value of diversity, organizations have an obligation to serve soci- 30222 another factor in Grunig’s model. etal needs (Chung, 1987), would seem also to 1 Arguably, this ‘infotainment’ message have been met. 2 works on two levels. First, it is inextricably ‘Perfect Day’ was revived in May 2002 to 3 linked to the important message of funding. promote a five-day, national music festival, 4 The licence fee is what makes possible the BBC Music Live, which featured more than 5 production of programmes of high ambition 1,000 hours of television, radio and online 6 and the public is asked to recognize this broadcasts. The sheer size of the undertaking 7 through the medium of celebrity endorse- was arguably something only the BBC with its 8 ment. Second, the ‘infotainment’ medium huge infrastructure (Grunig’s HR and organic 9 also seeks to engage the emotions of the structure factor) and creative flair (intrapre- 40 BBC’s own employees and contractors by neurship factor – necessary for innovation) 1 trying to create, through the images of these could reasonably claim to have been capable 2 endorsements, a corporate reputation that of producing in a UK context. The festival 3222 people will feel proud to be associated with. ended, on a national holiday, Monday 29

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors May, with 24 hours non-stop music broadcast Memoirs culminating, appropriately, in a rendering of ‘Perfect Day’. On this occasion it was sung and However, as O’Rourke states: a well-managed played simultaneously at venues throughout reputation can be stored over time to cushion the United Kingdom and edited live into one the adverse consequences of bad publicity. continuous broadcast performance. The corp- As a national icon, the BBC comes under criti- orate trail, which had started out in the BBC’s cal scrutiny not only from outside the organ- own words as a ‘licence payers’ information ization but also from within. Perhaps the most film’ achieved its zenith. On a national holiday damning reaction is that seen in BBC employ- one day in May it became, for a short time, an ees to the memoirs of the former Director alternative national anthem, identified and General of the BBC, John Birt. Both the media sung by large groups of people across the and BBC employees were critical of the direc- United Kingdom with the images seen by mil- tion of the BBC under John Birt. Birt has lions of others beamed directly into their been held responsible in some quarters for homes – via the BBC – creating such a sense of the damage to the reputation of a vital institu- community and a sharing of values, that the tion in the life of the nation (Daily Mail, BBC could be said to have fulfilled its public 11 October 02). Ironically, for a man brought service role in one moment and arguably in in to breathe new life into the BBC (Birt, the next, created a new genre in the field of 2002), he appears to have been cast as the reputation management. This one trail antithesis of Grunig’s Model of Excellence. showed almost all the factors identified in Michael Grade, then Director of Programmes Grunig’s Excellence Model. It took intrapre- for the BBC, damned Birt as a poor communi- neurship and innovation to think up the idea cator, who created a culture of secrecy through – the hallmark of excellence according to Peters (1987), leadership to see the task editorial dictatorship (as opposed to Grunig’s through (Peters and Austin, 1985), a partici- view that organizations should have sym- pative culture capable of integrating human metrical communication). Finance Director resources, organic structures and symmetrical Rodney Baker-Bowles cited Birt as a man that communication to ensure that employees did not understand human behaviour (Daily shared a sense of the mission and of the suc- Mail, 11 October 02). He was not alone, a cess, strategic planning as Kanter (1989) poll of 4,000 BBC employees in 1996 showed describes it – the vision to see the opportunity that 97 per cent were unhappy with Birt’s and ability to set up strategic partnerships regime (Daily Mail, 22 October 02) – pre- with the various stakeholders necessary to see dictably he dismissed the survey as meaning- the vision through, and as already discussed, a less, as opposed to Grunig’s view of HR where social responsibility – what Chung (1987) saw employees’ views and participation are as an organization’s obligation to serve soci- actively sought. In Birt’s apparent opinion, etal needs. An effective operational system size seemed to equal greatness. By diverting combined with a collaborative social culture £63 million sterling from mainstream pro- were also required to ensure that resources grammes, he expanded the news operation, were transformed as effectively as possible to but audiences quickly shunned the sterile, develop the mutual trust and teamwork nec- predictable bulletins. Deprived of money, essary to ensure the event’s success. the BBC’s drama and comedy departments

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 began to wither. At the end of his career, the organization, and unsurprisingly this litany 2 government was outraged that Birt’s BBC was of British innovation was soon terminated by 3 ‘dumbing down’ and increasingly dependent his successor, Greg Dyke. But the effects are 4 on American imports. Many of the BBC’s best still being felt. 5 creative talents left the organization and a The British people want to trust and believe 6 survey by accountants Price Waterhouse in the BBC as ‘one of the world’s most trusted 7 showed that 25 per cent of the corporation’s and valued broadcasters’ (DG’s Comment in 8 income, i.e. the licence fee, had disappeared Annual Report 2001/2002) but a different 9 in bureaucracy (Daily Mail, 11 October 02). BBC will create different long-term image and 10 All of these factors are the antithesis of reputation issues to manage – issues which lie 1 Grunig’s factors for achieving excellence in an at the heart of its corporate strategy. 2 3 4222 REFERENCES 5 6 Abratt, R. (1989) ‘A New Approach to the Corporate Dichter, E. (1985) ‘What’s in an image’, Journal of 7 Image Management Process’, Journal of Marketing Consumer Marketing, 2, 75–81. 8 Management, 5, 1. Dowling, G. R. (1993) ‘Developing your corporate 9 Argenti, P. A. (1998) Corporate Communication, 2nd image into a corporate asset’, Long Range 20 edition, Boston: Irwin/McGraw-Hill. Planning, 26, 2. 1 Balmer, J. M. T. (1989) ‘Corporate identity and the Fombrun, C. J. (1996) Reputation, Cambridge, MA: advent of corporate marketing’, Journal of Harvard Business School Press. 2 Marketing Management, 14, 963–96. Gotsi, M. and Wilson, A. M. (2001) ‘Corporate repu- 3 Balmer, J. M. T. (1995) ‘Corporate branding and con- tation: seeking a deﬁnition’, Corporate Communi- 4 noisseurship’, Journal of General Management, 21, cations: An International Journal, 6(1). 5 1. Grunig, J. E. (1992) Excellence in Public Relations and 6 Balmer, J. M. T. and Greyser, S. A. (2003) Revealing the Communications Management, New York: Law- 7 Corporation, London: Routledge. rence Erlbaum Associates. Bernstein, D. (1992) Company, Image and Reality. Grunig, J. E. and Hunt, T. (1984) Managing Public 8 A Treatise in the Sociology of Knowledge, London: Relations, New York: Holt, Rinehart and Winston. 9 Doubleday, Anchor Books. Grunig, L. A., Grunig, J. E. and Dozier, D. M. (2002) 30222 Birt, J. (2002) The Harder Path, London: Time Warner. Excellent Public Relations and Effective 1 Blumler, J. G. (2001) ‘The third age of political com- Organisations, New York: Lawrence Erlbaum 2 munication’, Journal of Public Affairs, 1(3). Associates. 3 Boulding, K. E. (1973) The Image, University of Hatch, M. J. and Schultz, M. (1997) ‘Relations Michigan Press. between organizational culture, identity and 4 Carroll, D. T. (1983) ‘A disappointing search for excel- image’, European Journal of Marketing, 31, 5–6. 5 lence’, Harvard Business Review. Herbig, P. and Mulewicz, J. (1995) ‘To be or not to be 6 Cheney, G. and Christensen, L. T. (1999) Identity at . . . credible that is: a model of credibility among 7 Issue: Linkages between Internal and External competing firms’, Marketing Intelligence and 8 Organisational Communications, Thousand Oaks, Planning, 13, 6. 9 CA: Sage Publications. Hickman, C. R. and Silva, M. A. (1985) Creating Christensen, L. A. and Askegaard, S. (2001) Excellence, London: Allen & Unwin. 40 ‘Corporate identity and corporate image re- Hobbs, J. B. (1987) Corporate Staying Power, Lexing- 1 visited’, European Journal of Marketing, 35. ton, MA: Lexington Books. 2 Chung, K. H. (1987) Management: Critical Success Ind, N. (1997) The Corporate Brand, London: 3222 Factors, Boston: Allyn and Bacon. Macmillan.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Kanter, R. M. (1989) When Giants Learn to Dance, New Van Riel, C. B. M. (1995) Principles of Corporate York: Simon and Schuster. Communications, London: Prentice Hall. Margulies, W. P. (1997) ‘Make the most of your corp- Van Riel, C. B. M. and Balmer, J. M. T. (1997) orate identity’, Harvard Business Review, 55, ‘Corporate identity: the concept, its measure- 66–74. ment and management’, European Journal of Martineau, P. (1958) The Personality of the Retail Store, Marketing, 31, 5–6. Cambridge, MA: Harvard Business Press. Meech, P. H. (1999) ‘Television clutter: the British experience’, Corporate Communications: An Other sources International Journal, 4(1). O’Rourke, R. (1997) ‘Managing in times of crisis’, Daily Mail, 11 Oct. 02. Corporate Reputations Review, 1, 1–2. Guardian Newspaper, 22 Jul. 02; 7 Nov. 02. Oliver, S. (1997) Corporate Communication, London: The Independent, 19 Feb. 02; Nov. 02. Kogan Page. Media Week, 1 Jun. 02. Oliver, S. (2002) Public Relations Strategy, London: Sunday Times, 20 Oct. 02. Kogan Page. BBC Annual report and Accounts 2001/2. Peters, T. (1987) Thriving on Chaos, New York: Knopf. www.bbc.co.uk/Info/report2000/pdf/bbc- Peters, T. and Austin, N. (1985) A Passion for summary.pdf Excellence, New York: Warner. A presentation to the Internal Audience at the BBC Stacks, D. W. (2002) Primer of Public Relations entitled ‘It’s Creative Darling’ by R. Grossman Research, New York: Guilford. (2001).

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 17 2 3 4 Corporate reputation 5 6 Philip Kitchen 7 8 9 10 1 2 3 4222 5 Corporate reputation, or the management and communication of the corporate brand, 6 is playing an increasingly important role in terms of the ability of corporations to build 7 and sustain market share, and influence the minds, and hearts of customers and stake- 8 holders all over the world. Corporate reputation also significantly impacts upon share 9 values, and on the ability of the business to attract and retain excellent employees. 20 This chapter discusses and outlines some findings from recent empirical research. It 1 provides a foundation for the view that corporate reputation has significant meaning for 2 CEOs in sustaining global performance at national and international levels. 3 4 5 6 7 The backdrop behind the emergence, rising ing in a globalised interactive marketplace or 8 importance, effective management, and marketspace: 9 more appropriate communication of corpor- 30222 ate reputation is the interconnected and that a multinational or global firm’s per- 1 omnipresent global economy. As early as sonality and image [inter alia its reputation], 2 1967 McLuhan said: ‘The new electronic will become the biggest factors in con- 3 interdependence re-creates the world in the sumer choice between its products 4 image of a global village’ (McLuhan, 1967). and services and those selected from com- 5 By 1994, Jack Welch stated: ‘In the envir- petitors. But, personality and image do 6 onment of the 1990s, globalisation must be not just impact on consumer choice and 7 taken for granted. There will be only one stan- behaviour, but also on a variety of publics 8 dard for corporate success: international or stakeholders, whose views and behav- 9 market share . . . winning corporations will iours can impact markedly on overall 40 win by finding markets all over the world’ corporate performance and simultaneously 1 (Welch, 1994). exert a positive or negative influence on 2 In an earlier book (Kitchen and Schultz, consumers, governments, and share- 3222 2001a), we argued that, by virtue of compet- holders.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Table 17.1 The best corporate reputations in the using four major indices (e.g., UK (FTSE United States 100 Index), USA (S&P 500), Japan (Nikkei 225), and Europe (Dow Jones Euro STOXX Rank Company name 50), all markets are dropping overall, and 1 Johnson and Johnson individual share values enjoy significant 2 Coca-Cola volatilities. 3 Intel • Investors (corporate and individual) are 4 Ben and Jerry’s 5 Wal-Mart searching for ‘safe haven’ investments, 6 Xerox and corporate reputation plays a signifi- 7 Home Depot cant role in invest/divest decisions. 8 Gateway • Chief executive officers are literally in the 9 Disney ‘firing line’ if targets are not reached, or 10 Dell markets respond badly to organizational 11 GE 12 Lucent initiatives. 13 Anheuser Busch • Board room doors seem to be continually 14 Microsoft revolving. 15 Amazon.com 16 IBM In this scenario, corporate ability to present 17 Sony 18 Yahoo! sustainable corporate reputation stories to 19 ATandT consumers, customers, business analysts, 20 FedEx industry analysts, and other interested and savvy publics and stakeholders, is of crucial Source: Featured in the Wall Street Journal, September 1999 importance. Among many quotations that could be cited, the following summarize the Notably, the Reputation Institute has shown current [academic and practitioner] position: that the best corporate reputations in the United States – the world’s major market Good reputation is very useful for an organ- (Fisher, 2000) – also means that the com- isation; it may enable it to charge premium panies perform significantly better than others prices for its products, enter into favourable in terms of market share and share value (Wall financial arrangements with banks, attract Street Journal, 1999). The top twenty corpor- graduates from top universities, get in ate reputations are shown in Table 17.1. touch with customers easily, and so on, Despite the positive influence exerted by such that good reputation constitutes a good reputation, good reputation occurs valuable asset to the organisation. within environmental circumstances and (Fombrun and Shanley, 1990; the market environment over the past three Shapiro, 1983) to four years has borne significant resemblance to a tremendous storm out at sea. For In contrast, an organisation with bad or no example: reputation is likely to encounter situations where the opportunities open to it are few • There are no more stable marketplaces, and the constraints imposed on it are only turbulent ones. many. • If one compares stock market valuations (Podolny, 1993; Vendelo, 1998)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 One could liken corporate reputation to a flag. promises of ethical corporate behaviour. 2 Given any particular corporation in Table However, as we turn to the current literature 3 17.1, and using apperceptions associated with in all medias concerned with reporting such 4 the flag metaphor, where on the flagpole behaviour, there is a nagging suspicion 5 would the flag actually be? What colour that many business executives may have 6 would it be? What condition would the flag made Machiavelli current bedtime reading. 7 be in at this point in time? As the chapter Certainly Enron, WorldCom, Marconi, finan- 8 unfolds, please keep the flag metaphor in cial traders, investment bankers, and trusted 9 mind. individuals in positions of authority have all 10 recently had their corporate reputations 1 revealed as more concerned with rhetoric 2 Global issues and global problems than with reality. Meanwhile, tens of thou- 3 with corporate reputation sands of people and organizational investors 4222 have either been badly let down, lost 5 We live in a world awash with corporate (£$millions), and consumer and stakeholder 6 promises. The promises not only come from confidence and goodwill has been further 7 business corporations though that is the major eroded. For example: ‘Enron, the American 8 focus here. But they also come from political energy trader and self-proclaimed “world’s 9 parties – spokespersons and spin doctors; leading management company” went spec- 20 and they come from corporate entities of tacularly bust. Financial management (or mis- 1 all types with the profit axe to grind. Often management) was to blame for the $17 2 such promises and assertions are associated billion black hole in its accounts’ (Observer, 3 with individuals – in the corporate sense it is 23 December, 2001, p. 4). 4 usually the CEO (e.g., Richard Branson, Anita The focus on fraudulent dealing will be 5 Roddick, Bill Gates, etc.). But, are such most unwelcome for the accounting industry. 6 promises to be believed? Perhaps a jaundiced In summer 2001, Arthur Andersen had its 7 perspective on corporate reputation may have corporate reputation mauled for shredding 8 long preceded the modern era, but still have ‘literally tons of documents’ relating to Enron 9 recognizable meaning for corporations and (see Guardian, 2002). Similar mismanagement 30222 the consumers they ostensibly serve – in our (though not fraudulent) is also evident in the 1 day: case of Marconi whose shareholders are to 2 receive one-twentieth the share value of their 3 those who have known how best to imitate stock (2003). WorldCom has also had its repu- 4 the fox have come off best. But one must tation shattered. Even J. K. Galbraith emerged 5 know how to colour one’s actions and to be from semi-retirement with a new book due to 6 a great liar and deceiver. Men are so be published in 2004. Its title: The Economics 7 simple, and so much creatures of circum- of ‘Innocent Fraud’ (emphasis added). And 8 stance, that the deceiver will always find yet, reputation – so clearly important in the 9 someone to be deceived. field of corporate activity – is also exposed to 40 (Machiavelli, The Prince) criticism even at the individual level. In the 1 past few years, the following names and repu- 2 Machiavelli’s statement has resonance in tations have also been severely dented in 3222 today’s world. For our world offers many society: Jeffrey Archer, John Major, Peter

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Mandelson, Henry McLeish, and Slobodan different. Moreover, it is difficult to turn such Milosevic. Thus, reputation of either a corpor- broad brush strokes into a detailed strategic ate or individual nature is evidently an oppor- picture. The major question is: tunity for rhetorical public proclamation, but perhaps also of private renunciation, hence • How do companies perceive and manage the use of the quotation from Machiavelli. corporate reputation? Moreover, 2002 will be remembered as a year of corporate crime, the year President George Let us first take a look at why these three rep- Bush – on behalf of a nation – embraced the utation principles have assumed such pre- notion of ‘corporate responsibility’. Remark- eminence in the corporate reputation debate. ably, the ten worst corporations of the year, are also avid promoters of the concept of corporate reputation. These ten corporations Principle one: greater were described as: ‘polluters, dangerous pill accountability peddlers, modern-day mercenaries, enablers of human rights abuses, merchants of death, Businesses are becoming ever more account- and beneficiaries of rural destruction and able (Marsh Topic Letter, 2001). Just as they death’ (Mokhiber and Weissman, 2003). For a face more complicated national and inter- full list of these ten businesses and their corp- national business environs, which occasion orate activities, please access http://www. more business problems, within those envi- multinationalmonitor.org rons they are scrutinized by sophisticated Despite poor examples of reputation in shareholders, and by involved publics, stake- practice, corporate reputation is on the global holders, and consumers. Businesses have to agenda of virtually every corporation, it has abide by rigorous regulation and rapidly almost become a form of mantra for twenty- evolving standards. They are always encour- first century corporations, and – as said earlier aged to grow, be profitable, and provide – a strong reputation equals a healthy bottom excellent ROI. But these are no longer enough. line and a robust share price. Growth, profits, and ROI will always be busi- Given this widespread position of accep- ness necessities. But, the businesses are also tance of corporate reputation, we will now part of the societies in which they operate, consider three related principles: and they have to consider the impact their behaviour has on these societies. The impact 1 Modern corporations must demonstrate businesses may have upon society can be accountability to all stakeholders. likened to ‘dropping a stone into a pond’. 2 Corporations should embrace the The three stages of ‘ripple effect’ (derived market’s growing perception of the CEO from Harrison, 1997) – which one expects to as the personification of a company’s be sustained and accelerated – are: ideals and goals. 3 Corporations should use the internet as a • Level one: businesses are expected to pay mass communications tool. taxes, observe all legal requirements, and deal fairly. However, what a corporation knows it should • Level two: concerned with organizational do and what it actually does do, may be very issues in which the corporation seeks to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 minimize all potential negative effects, significant investment is required in gaining 2 and to act, not just in accord with the the required senior personnel and providing 3 letter, but also the spirit of the law. excellent support infrastructure. But all these 4 • Level three: concerned with societal issues factors would be to no avail, without principle 5 such as the concern for health, and to help two. 6 remove or alleviate societal inequities. 7 This third level extends well beyond 8 financial and operational issues. Principle two: the chief executive 9 officer 10 But that was 1997. Corporate responsibility 1 has now come under the microscopic atten- The chief executive officer (CEO) is the person 2 tion of governments, institutional investors, charged with responsibility to communi- 3 opinion formers, best-practice organizations, cate the reputation of the business (Bennis, 4222 customers, consumers, and other informed 1997; Koch, 1994; Zorn, 2001). CEOs do 5 streetwise, sophisticated, and savvy groups. not operate alone. They must be supported 6 Stakeholders seek to understand and, if neces- by, or build around themselves, corporate 7 sary, criticize the social and ethical perform- communication specialists who develop pro- 8 ance of corporate entities in which they have grammes in a manner consistent with the 9 an interest (Fombrun, 1996). This interest corporate identity. The tools used by corpor- 20 extends beyond financial and operational ate communication personnel include: public 1 issues. Marsh further indicates: ‘Corporate relations, public affairs, investor relations, 2 social responsibility addresses both the sus- government relations, labour market com- 3 tainability of an organization’s activities and munications, issues management, social 4 the moral acceptability of its actions. responsibility programmes, corporate adver- 5 Management would do well to integrate these tising, and media relations. But all of these 6 considerations into their thinking.’ mechanisms to support and sustain reputation 7 In the global environs of the twenty-first are merely rhetoric if the organization or its 8 century, the old exchange process is insuffi- personnel act unethically, are seen to damage 9 cient. Brands and branding are insufficient. the societies where they do business, or simply 30222 Monies changing hands is insufficient. Stake- do not develop appropriate relationships with 1 holders want to know the company behind stakeholders. Faced with recalcitrant corporate 2 the brands. And companies have a desire to entities, investors invest elsewhere, consumers 3 amortise communication cost across brand prefer competing alternatives, and legislators 4 portfolios. Thus, they need to raise the corp- force change. 5 orate umbrella (see Kitchen and Schultz, Businesses, led by the CEO, must be seen to 6 2001a). However, as noted elsewhere (see be acting in a socially responsible manner. 7 Kitchen, 1997), expenditure in the field There are at least two reasons. First is the 8 of corporate communications is dwarfed by overarching need to develop the corporate 9 traditional brand marketing communication brand to sustain and maintain the corporate 40 budgets. Significant financial investment is reputation (Herbig and Milewicz, 1995; 1 necessary to promote the corporate brand; Ettore, 1996; Vendelo, 1998; Schultz and 2 significant management time is required to Kitchen, 2000; Kitchen and Schultz, 2001a; 3222 develop and sustain corporate reputation; Kitchen and Schultz, 2001b; Kitchen and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Schultz, 1999). The second reason is the they themselves must communicate person- requirement to protect and nurture strategic ally, effectively, and well. This is an absolute business units and their associated brands to must. enable them to grow. Strategic business units, Given the two related strands – increased as indicated by planning grid matrices accountability and CEO communication – (McCarthy and Perrault, 1994) are the power- corporate reputation becomes an essential ful building blocks of corporations. They are component of national, international, and powerful corporate assets, the brands they global success. Failure to communicate, or manage are powerful corporate assets too worse – miscommunication, can do much to (Brand Finance, 2000). SBUs and their brands damage corporate reputation and simultan- need a powerful business backing them. eously brand sales, market share, and share Business leaders everywhere see a positive values. It is too important a subject to leave to corporate image as an absolute prerequisite chance. But, there is still a third principle for achieving strategic business objectives which companies ignore at their peril. Kitchen and Schultz (2001b) described the chief executive officer as ‘holding the handle of the corporate umbrella’. This means that Principle three: the power of the CEO is not only the chief instigator of all internet communication communication activity; he/she is also the person responsible for personifying such By year-end 2003 it was estimated that there information. CEOs such as Bill Gates, Anita were six hundred million users of the internet Roddick, Richard Branson, Jack Welch, Dave globally. Notably, these users were statistically Thomas, and Lee Iacocca help create and sus- spread as one would expect in a global econ- tain a positive corporate image that has reso- omy with the United States at 36 per cent; nance for stakeholders, including the Japan at 11 per cent, Germany 6 per cent, and all-important triumvirate of customers, the United Kingdom at 5 per cent. Kitchen investors and employees. Zorn (2001) points and Laurence (2003) state: ‘the increasing out that such ‘leaders’ represent not only their power of global media, consumer and share- own companies, but also sets of values and holder power, and the shifting public role of positions on prominent social issues: ‘Effective corporations underpin the new dynamic leaders – particularly in highly visible posi- agenda for building and maintaining corpor- tions – must be skilled communicators.’ He ate reputation. But there is a place (“space” goes on to say: ‘A handsome or pretty face will might be a better word) where these issues only go so far these days. It is not enough to have come to a head faster and with greater make a few cogent remarks from time to time. impact – the Internet’. These must be related to the core values asso- The internet has the capacity to facilitate or ciated with the corporation and what it stands damage corporate reputation. Of the millions for in society’ (Zorn, 2001: 27). In today’s of sites accessible and available, many are global marketplace, CEOs are necessarily cast geared to detailing and reporting the activities in the role of influential corporate reputation of specific corporations and industries. Unlike influencers. They do not stand alone, but have other more traditional media, information can a wide range of corporate communication span the internet almost instantaneously with resources and personnel to assist them. But almost no effort. Company boundaries, once

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 tightly sealed, are blurring. Internal mail is no Table 17.2 Primary industry (%) 2 different from external mail. It is no longer 3 necessary to sneak sensitive subversive or con- Manufacturing 27 4 fidential information out of buildings. It is Business services 19 Technology/telecom/IS 9 5 necessary only to press the ‘attach’ and ‘send’ Distribution 8 6 buttons. There is no real hierarchy between Consumer durables 8 7 ‘official’ and ‘unofficial’ websites, they all Consumer products 6 8 have the same status on the web. A simple UK Financial services 4 9 search for BT, revealed that the ‘official’ web- Construction 4 Energy/utilities 4 10 site, the one owned and marketed by BT, was Health care 3 1 ranked 33 in the list. In terms of corporate Transportation 3 2 reputation, the internet has the power to Other 5 3 break all the bulwarks of scale, obstruction, Source: Hill and Knowlton/Harris Interactive (2001) 4222 and distance that has allowed corporations to 5 control stakeholder communication in the 6 past. Information posted on the web (possibly • the most meaningful measures; 7 hearsay and speculation) can make and break • key influencers; 8 share prices in today’s global interconnected • relationship to international expansion; 9 economy. • CEO reputation; 20 In relation to the three factors we have dis- • ability of CEO to protect and enhance 1 cussed: accountability, CEO communication, reputation; 2 and the internet, the findings from an ongoing • responsibility for managing reputation. 3 international corporate reputation study may 4 be advantageous. The study concerned executive perceptions of 5 corporate reputation by attempting to meas- 6 ure and benchmark the role and importance 7 Setting the scene placed on a company’s reputation by execu- 8 tives in the eight countries. A secondary and 9 Each year since 1997, Hill and Knowlton/ related purpose was to identify and explore 30222 Harris Interactive (2001) have carried out a the role of key influences on corporate reputa- 1 study considering executive opinions and tion, both internal and external to a company. 2 views relating to corporate reputation in many The primary industries involved in the study 3 nation states. For example, in a paper written are shown in Table 17.2. 4 by Kitchen and Laurence (2003) on which this The demographic profile of respondents 5 chapter is based, corporate reputation in eight was as follows: 6 nation states is explored. In this chapter 7 though, we will extrapolate the findings from • 8 per cent were CEOs 8 that study to understand and explore the • 7 per cent were chairs/vice chairs, or chief 9 following issues or questions relating to corp- operating officers 40 orate reputation: • 25 per cent were corporate financial offi- 1 cers 2 • its importance; • 17 per cent were general managers 3222 • whether it is measured formally; • 22 per cent were managing directors

Less than $100 million 50 1998 1999 2000 $100 million to less than $500 million 26 $500 million to less than $1 billion 6 Importance of corporate a More than $1 billion 9 reputation 94 94 94 Refused to divulge 9 Implementation of formal reputation measurement Source: Hill and Knowlton/Harris Interactive (2001) systems (in place) 19 37 42

Source: Hill and Knowlton/Harris Interactive (2001) • 21 per cent were regional CEOs or Note: a The importance of corporate reputation increases with ﬁrm turnover regional managers

Of these respondents, 17 per cent of respond- measurement systems. What seemed to be ents were members of boards other than carried out on an ad hoc or unsystematic basis that of their own company; and 78 per cent in 1998, was far more sophisticated in 2001. were from private, as compared to public, Corporate reputation was seen as of great companies. importance relating to the achievement of Revenue from these firms is reported in business objectives in all countries (see Table Table 17.3. The demographic criteria indicate 17.4). Thus, ‘marketing’ or ‘creating ex- that a widespread response was obtained changes’ would just be one (albeit extremely from board-level personnel. Given the self- important) element in developing and main- directed nature of response, however, the taining a sound corporate reputation. A study can be viewed as exploratory and as a second related element concerns the gather- prelude to more in-depth analyses. ing of research data that monitors and measures corporate reputation on an ongoing basis. Research findings A major trend in the 1980s and 1990s was for businesses to augment marketing Given that the study has been carried out and latterly corporate communication de- annually, the findings reveal that corporate partments with in-house analytical services reputation, its measurement and its manage- (McDaniel and Gates, 1993; Van Riel, 1999). ment, is high on the agenda of leading com- The current measurement devices used in panies and executive minds in many countries terms of corporate reputation, however, can around the world. Corporate reputation is of all be applied informally, rather than struc- significant importance to CEOs in achieving tured into business activity in a formalized corporate objectives. More and more com- manner. However ‘custom research’ is invari- panies are developing and putting into place ably ranked first in order of importance, but formal systems to measure corporate reputa- much greater analysis is needed on a case by tion. Table 17.4 indicates that while the case basis to discover what such custom importance of corporate reputation has research actually entails and the contribution apparently not changed in at least three years, such research makes. its importance is highlighted by firms as they What influences corporate reputation the develop and implement formal reputation most? The findings from the study indicate

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 that customers, employees, and the CEO (in the corporate entity that ostensibly owns the 2 that order) are all most highly ranked in terms brands in terms of: 3 of maintaining corporate reputation. By nigh 4 on unanimous vote, customers are by far • What does the parent company do? 5 the most important influence on corporate repu- • What doesn’t it do? 6 tation (see Kitchen and Schultz, 2001a). • What values does it personify? 7 However, this point is not unremarkable in • Which personalities are running the com- 8 that it has been hammered home in innumer- pany? 9 able text books and articles derived from the • How do they treat employees globally? 10 marketing discipline. Customers are important • Are they ‘good’ corporative citizens? 1 for at least five marketing reasons as listed by The issue of how employees are treated can 2 Schultz and Walters (1997), but note however, become important media news all round 3 that each of these terms also has resonance for the world. As Nike has found to its cost, it is 4222 corporate communication and reputation. one thing to subcontract work to factories in 5 Southeast Asia, and quite another to square 6 1 Buying rate: a base measure of loyalty sweatshop wages with premium prices in 7 which allows the firm share of market, western markets. Bennis (1997) makes the 8 mind and heart. claim that for corporate vision to be meaning- 9 2 Customer retention, in total and by class: the ful it has to be shared at all organizational 20 percentage of customers retained in a spe- levels. Sharing a vision implies a sense of 1 cific accounting period. belonging, support given to corporate goals 2 3 Customer advocacy: increases in customer and positive behaviour and word of mouth. 3 referrals as a percentage of total cus- Fombrun (1996) indicated that corporations 4 tomers is also a key indicator of loyalty. that employees would like to work for pro- 5 4 Price elasticity: where customers are willing mote trust, empower people and inspire 6 to accept price increases with little pride. It is remarkable how few organizations 7 or no effect on their behaviour, strong are able to achieve these seemingly simple 8 loyalty is presupposed. objectives. 9 5 Customer-switching costs and barriers to In a wider international context, corporate 30222 competitive entry: where a brand creates reputation plays an important role in terms of 1 customer-switching costs, loyalty is more generating sales in new overseas markets. But, 2 likely to be achieved. The greater the Dunning (1993) considers that reputation 3 switching costs the more difficult it is for extends well beyond sales performance. From 4 competitors to ‘pull’ customers away from a multinational enterprise context he asks: 5 the brand. 6 • Is its impact on economic welfare a good 7 The Schultz and Walters range of criteria, thing? 8 however, is supported by a range of measures • If it is (already) good, how can it be made 9 from the corporate communication literature. even better? (brackets added) 40 For many firms, the brand is not just the prod- • Do we wish our country to be tied to 1 uct(s) customers learn about, consider, value, an international division of labour fash- 2 purchase, consume, and are loyal to. ioned or influenced by foreign MNE 3222 Customers increasingly want to know about activity?

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors While there is little doubt that good reputa- CEOs do, or do not do, this is the most import- tion precedes market entry and market ant task of CEOs in today’s environs. Why? growth rates, of even more importance is the Because the perceptions, beliefs, and feelings ‘insider’ phenomenon, where the corporation of stakeholders (including the all-important needs to be inside the economic firewall customers) impacts on the current and on- such as the European Community, ASEA, or going success of the company. Surely, these NAFTA, for example (Ohmae, 1985, 1989; perceptions, beliefs, and feelings need to be Czinkota and Ronkainen, 1995). targeted by effective integrated corporate and marketing communication? a) CEO reputation enjoys a significant cor- Reputation – at least in presentational relation with corporate reputation, though and rhetorical terms – has become part of this varies from country to country within the warp and woof of everyday corporate the Hill and Knowlton study. When CEO’s activity. Based on the theoretical evidence retire the ability of the proposed new presented, and that of a limited empirical incumbent is carefully scrutinised in terms nature, corporate reputation is here to stay. of his/her impact on reputation (see also It will be a dominant theme of corporations Van Riel, 1999; Pincus et al., 1991). in the twenty-first century, together with its sub-themes of corporate identity and the In the twenty-first century, managing corpor- measurement of corporate image among ate reputation is a global responsibility, which stakeholders who could impact organizational means that whatever is planned or communi- performance. It is not enough to have a corp- cated must be done on a national, inter- orate reputation, such reputation must also national, or global basis. be planned, managed, and capable of evaluation. In the mind of any reader must be misgivings. Maybe the earnest statements Discussion and conclusion of behavioural intent found on the websites and literature of corporations are no more As seen from the findings of the Hill and than Machiavellianism translated to the Knowlton study, and in the preceding re- twenty-first century, with all the believability view of literature, corporate reputation and of political rhetoric. Reputation is, in the end, its management has become increasingly no more and no less than a reflection of what important to firms of all types and sizes. is believed to be ethical in a particular society Reputation management is thus a topic of at a specific point in time. The fact that so great importance to corporations, and many many fall below even stated expectations is a other organizations and their leaders in this problem for students and business practition- new century. New buzzwords may well ers to ponder over. include: correlation, CEOs, communication This chapter commenced with a metaphor. and connectivity insofar as reputation is con- I asked readers to imagine that corporate rep- cerned. While the old executive issues of utation was like a flag, and then asked three managing resources, capital, labour, and tech- questions: nology will always be there, alongside these traditional managerial issues will be that of 1 Where on the flagpole would the flag be managing the corporate brand. Whatever else positioned? The best estimate may be

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 that corporate reputation is somewhere somewhat unwashed or rather grubby 2 close to half mast or below. It is reality for grey. 3 some corporations and rhetoric for others. 3 What condition would the flag be in at this 4 And in between, perhaps – the rest drift to point in time? Not in pristine condition, 5 and fro. perhaps a little bedraggled and torn. 6 2 What colour would the flag be? Rather than 7 bright colours on a pristine white back- The responsibility for improvement, and the 8 ground, corporate reputation may be a need for further research, is clear. 9 10 1 NOTE 2 3 This chapter is dependent on material derived from Limited, Palgrave Publishers, Yankelovich Partners, 4222 various sources and we acknowledge the kind permis- and Corporate Reputation Review and Forum, to utilize 5 sion of Harris Interactive, Hill and Knowlton, Marsh and cite some of the materials in this chapter. 6 7 8 REFERENCES 9 20 Bennis, W. (1997) ‘Becoming a leader of leaders’, in linking behaviour with reputation’, in P. J. 1 R. Gibson (ed.), Rethinking the Future, London: Kitchen (ed.), Public Relations: Principles and Nicholas Brealey Publishing. Practice, London: International Thomson, pp. 2 Brand Finance (2000) ‘Brand Valuation’ June, p. 3. 128–47. 3 Czinkota, M. R. and Ronkainen, I. A. (1995) Inter- Herbig, P. and Milewicz, J. (1995) ‘The relationship of 4 national Marketing, 4th edn, Fort Worth: The reputation and credibility to brand success’, 5 Dryden Press. Journal of Consumer Marketing, 12(4), 1–6. 6 Dunning, J. H. (1993) Multinational Enterprises and the Kitchen, P. J. (1997) Public relations: Principles and 7 Global Economy, Wokingham: Addison-Wesley Practice, London: Thompson. Publishing Company. Kitchen, P. J. and Laurence, A. (2003) ‘Corporate rep- 8 Ettore, B. (1996) ‘The care and feeding of a corporate utation: an eight-country analysis’, Corporate 9 reputation’, Management Review, 85(6), 39–43. Reputation Review, 6(3). 30222 Fisher, K. L. (2000) ‘All a broker needs to succeed’, Kitchen, P. J. and Schultz, D. E. (1999) ‘A multi- 1 Research, July, 41–5, (www.researchmagazine. country comparison of the drive for integrated 2 com) marketing communications’, Journal of Advertis- 3 Fombrun, C. and Shanley, M. (1990) ‘What’s in a ing Research, 39(1), 21–38. 4 name? Reputation building and corporate strat- Kitchen, P. J. and Schultz, D. E. (2001a) Raising the egy’, Academy of Management Journal, 33(2), Corporate Umbrella: Corporate Communications in 5 233–58. the 21st Century, London: Palgrave. 6 Fombrun, C. (1996) Reputation: Realizing Value from Kitchen, P. J. and Schultz, D. E. (2001b) ‘A compara- 7 the Corporate Image, Harvard, MA: Harvard tive analysis of integrated corporate and product 8 Business School Press. brand communications’, Journal of Global 9 Guardian (2002) 1 March, p. 5. Competitiveness, 9(1), 438–41. 40 Harris Interactive (2001) ‘The Hill and Knowlton/ Koch, J. (1994) ‘In search of excellent management’, Harris Interactive International Corporate Journal of Management Studies, 31(5), 681–99. 1 Reputation Report: C-Suite Executives on the Machiavelli, N. (1995) The Prince, tr. G. Bull, London: 2 Value of Corporate Reputation, the Internet and Penguin, p. 55. 3222 Reputation Influencers’, May. Marsh Topic Letter (2001) ‘Social and Ethical Risk’, Harrison, S. (1997) ‘Corporate social responsibility: London: Marsh Limited, www.marsh.com

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors McCarthy, E. J. and Perrault, W. D. (1994) Essentials of Schultz, D. E. and Kitchen, P. J. (2000) Global Com- Marketing, 6th edn, Chicago: Irwin, p. 105. munications: An Integrated Marketing Approach, McDaniel, C. and Gates, R. (1993) Contemporary Chicago: NTC Business Books; London: Marketing Research, 2nd edn, St Paul, MN: West Macmillan. Publishing Co. Schultz, D. E. and Walters, T. (1997) Measuring Brand McLuhan, M. S. (1967) cited in W. J. Keegan (1999) Communication ROI, Chicago: American Market- Global Marketing Management, New Jersey: ing Association. Prentice Hall, p. 1. Shapiro, C. (1983) ‘Premium for high quality products Mokhiber, R. and Weissman, R. (2003) ‘The 10 worst as returns to reputations’, Quarterly Journal of corporations of 2002, available at http://www. Economics, 98(4), 659–81. multinationalmonitor.org downloaded 2 Janu- Van Riel, C. (1999) Corporate Communications, New ary; cited here with permission. Jersey: Prentice Hall. Observer, (2001) 23 December, p. 4. Vendelo, M. T. (1998) ‘Narrating corporate reputa- Ohmae, K. I. (1985) Triad Power: The Coming Shape of tion’, International Studies of Management and Global Competition, New York: The Free Organisation, 28(3), 110–28. Press. Wall St. Journal, (1999) ‘The best corporate reputa- Ohmae, K. I. (1989) ‘Managing in a borderless tions’, September. world’, Harvard Business Review, 67, May–June, Welch, J. (1994) cited in W. J. Keegan (1999) Global 152–61. Marketing Management, New Jersey: Prentice Pincus, J. D., Robert, A. P., Rayﬁeld, A. P. and DeBonis, Hall, p. 1. J. P. (1991) ‘Transforming CEOs into chief com- Yankelovich Partners (2001) Hill and Knowlton – munication officers’, Public Relations Journal, Third Annual Corporate Reputation Watch: CEOs 47(4), 87–92. on Corporate Reputation. Podolny, J. M. (1993) ‘A status-based model of Zorn, T. (2001) ‘Talking heads: the CEO as spokes- market competition’, American Journal of Soci- person’ in P. J. Kitchen and D. E. Schultz (2001), ology, 98(4), 829–72. pp. 26–7.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 18 2 3 4 Communicating a continuity plan: 5 6 the action stations framework 7 8 Sandra M. Oliver 9 10 1 2 3 4222 5 Restructuring during the 1980s and 1990s often saw functional areas such as investor 6 relations and government relations become the remit of ﬁnance or treasury departments, 7 while internal or employee management communication found itself positioned as a low 8 priority activity in human resource departments. During a disaster, this often left respon- 9 sibility for corporate affairs such as image, identity and reputation management in a 20 vacuum and without reference to corporate PR and communication strategists other than 1 as an afterthought by marketeers responsible for customer relations or product promo- 2 tion. The result was often a long-drawn-out damage limitation exercise or worse. 3 The chapter focuses on three banks to illustrate how emergency communication struc- 4 5 tures and processes are critical components in forward planning. The role of corporate 6 communication/PR director is pivotal in any organization’s continuity planning, carrying 7 as it must for optimum performance, board-level authority and accountability, as illus- 8 trated by the co-dependency Action Stations Framework. 9 30222 1 2 3 Introduction specialists is media relations, yet titles and 4 roles of communication practitioners in British 5 At this critical point in the history of corporate organizations vary. In banks, for example, 6 communication management theory and operational and strategic organizational func- 7 practice as it evolves from PR disintegration, tions, including crisis management, may 8 in parallel with the convergence of tech- appear as shown in Table 18.1. 9 nology, the role of integrated communication In 1986 a Gallop survey of Britain showed 40 management in industry and commerce is that only 3 per cent of the general population 1 once again attracting a higher proﬁle, particu- trusted bankers, which suggests that in a crisis 2 larly in the banking industry. The principal situation, banks are likely to attract more 3222 activity during a crisis for communication adverse publicity from the media than other

Banks Department Functions

Abbey National Corporate Affairs Media relations; public relations; internal communication (newsletter, video) Barclays Bank Communications Shareholder communications; employee relations; support for community – young people; the arts and the environment; press relations Co-operative Bank Public Relations Press information; opinion survey; publicity; policy development; community projects; funding for charity works; internal communications Lloyds Bank Corporate Communications Environmental policy; community support; internal communication; information service to the public, in particular students; corporate sponsorship; press information Midland Bank Corporate Communication Monitor corporate identity; corporate brochure; internal communication; media relations, public relations; ethnic and environmental policy Nat West Bank Corporate Affairs and Co-ordinate internal communication; group media relations; Communications develop public and ethical business policies; investor relations; community relations; campaign for plain English; ‘green policy’ – best practice; staff suggestion scheme; school programme – ﬁnancial literacy, personal money management, opinion formers (politicians, business leaders) relations; advise business unit on advertising Royal Bank of Corporate Communications Community relations; corporate sponsorship of sport and Scotland cultural events; environmental policy – energy conservation; guides to services and products TSB Bank Group Corporate Corporate advertising; press relations; investor relations; Communications corporate identity; internal communication-newsletter and special events British Bankers’ Communications and External Communication strategy; media relations; ‘educating’ the Association Affairs publics; identify target audience; opinion research; banking seminar and conferences

professions. Although Liew’s (1997) research shaping a bank’s course of action, how it is indicated that Britons were largely satisﬁed structured and its decision making process.’ with the performance of the banks and were Banks perhaps more than most have had to less antagonistic than the media indicates, an address the sheer scale of environmental integrated communication strategy is essential change brought about by technology, global- in managing relationships with all stake- ization and social change, so although Liew holders and that ‘effective relationship found no significant anti-bank bias in the management requires corporate action or media, he argued that ‘the weakness in exist- change. Corporate communication – including bank/media relations in the United King- ing the research function – plays a role in dom is a glaring knowledge gap that will

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 expand as the nature of banking business closed doors’ influence, but when it does take 2 increases in complexity’ (1982). place, it is the largest shareholders who get 3 Thus tactical, empirically derived evidence most involved and who have disproportionate 4 for communication programme planning and influence on the company, board and senior 5 budgeting is no longer good enough. Strategy management team. 6 also informs tactics at both research and eval- Table 18.2 identifies and distinguishes the 7 uation levels to a very high degree, which is difference between routine emergencies and 8 why the professional studies programme at disasters. For an international bank experienc- 9 Thames Valley University in London is one of ing, say, cyberspace terrorism as a result of 10 the first, if not the first European University to systems intervention from a hostile hacker, 1 incorporate knowledge and information dependency on a geographical measure to 2 management as a core learning module in its define the scale of such crisis is unlikely to be 3 masters degree programme in addition to the very helpful. Prior to the mid-1980s, PR prac- 4222 ability to critically analyse best practice titioners thought in terms of ‘routine emer- 5 models of performance. gencies’ and suggested that a crisis has five 6 stages. Fearn-Banks argues that crisis manage- 7 What the books say ment is strategic planning to prevent and 8 respond during a crisis or negative occurrence, 9 Given the limitations of empirical research a process that removes some of the risk and 20 underpinning the professional era of public uncertainty and allows the organization to be 1 relations between the post-war period and in greater control of its destiny. However, if as 2 the present day, academics have attempted to she says a crisis has five stages, the banking 3 apply business or corporate strategy models culture has to create for itself an anticipatory 4 to the management of communication as a model of crisis management which ‘guides 5 value added component of linked organiza- practitioners toward a position in which they 6 tional mission and goals. However, awareness can proactively investigate their organization 7 of the need for companies and investors to to determine the most likely cause of techno- 8 maintain relationships with all stakeholders in logical crisis’. With a foundation in anticipa- 9 the interests of corporate performance, puts tion and empowerment, each bank’s model 30222 pressure on companies to reassess levels of would optimize the precautionary abilities of 1 influence which could be reliably measured in the organization to prevent and cope with a 2 respect of the bottom line. Gaved (1997) crisis, ‘routine emergency’, but would they be 3 argues that ‘a new model of corporate change adequate for a ‘disaster’? Table 18.3 suggests 4 and evolution needs to be developed, which the range of routine emergencies and disasters 5 enables management teams to be renewed which might occur. 6 without major discontinuity. This need is quite Olaniran and Williams (2001) argue that 7 independent of the issue of takeovers. What ‘crisis prevention requires a thorough under- 8 we currently have is a system of informal standing of the technology and the context in 9 influence, which increases the pressures on which the technology is being used’. This 40 companies – which normally means the CEO includes processes of enactment and expecta- 1 and chairpersons – in response to deteriorat- tion as well as vigilant decision making and 2 ing performance. For most companies, most they suggest there are two key issues involved, 3222 of the time there is very little of this ‘behind namely rigidity and control.

Routine emergencies Disasters

Interaction with familiar faces Interaction with unfamiliar faces Familiar tasks and procedures Unfamiliar tasks and procedures Intra-organizational co-ordination needed Intra- and inter-organizational co-ordination needed Roads, telephones, facilities intact Roads blocked or jammed, telephones jammed or non- functional, facilities damaged Communications frequencies adequate for radio Radio frequencies often overloaded trafﬁc Communication intra-organizational Need for inter-organizational information sharing Use of familiar terminology in communicating Communication with persons who use different terminology or speak another language Need to deal mainly with local press Hordes of national and international reporters Management structure adequate to co-ordinate Resources often exceed management capacity the number of resources involved

Source: Auf der Heide (1989)

Table 18.3 International terrorism incidents, Rigidity is the degree of inflexibility built 1968–79 into a particular action or process. This is Number % important in terms of interaction and successful outcome because it recognizes that individ- Type uals will view problems during any crisis in Explosive bombings 1,588 48 Incendiary bombings 456 14 different ways; through different perceptions Kidnappings 263 8 people select different options from those Assassinations 246 7 available and the consequences will deter- Armed attacks 188 6 mine the quality of the outcome. Control on Letter bombings 186 6 the other hand is viewed as ‘the degree of Hijackings 100 3 influence that organisational members have at Theft/break-ins 78 2 Barricade and hostage 73 2 their disposal. Control is often elusive because Snipings 71 2 it has to do with individual perception espe- Other 87 3 cially when the influence is indirect in nature,’

Target Olaniran and Williams quote the case of Business executives/facilities 487 36 ATAT’s crisis episode in which ‘a software Diplomatic officials/property 273 20 glitch caused a power outage that disrupted its Other government officials 217 16 nationwide services for nine hours in January Military officials/property 204 15 1990’, causing ‘an inter-dependent effect on Private citizens 166 12 other organizations’. The authors suggest that Source: US Department of Defense and Central Intelligence Agency in Regester (1989) Crisis Management the anticipatory model of management can be likened to the law of probability indicating that the less frequent the occurrence of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 an event, the greater the probability that responsible and there should be units of dif- 2 the event will occur in the future. There- ferent managerial sizes for different purposes 3 fore, organisation should and must con- and all units will have been simulated and 4 tinue to evaluate reliance on technology practised under health and safety regulations. 5 and to prepare for crises in advance. The Clearly this span of control must not be exces- 6 anticipatory model of crisis management sive but must be organized so that real control 7 suggest the possibility that crises could be is maintained like an army in war time. In 8 held in check through an understanding of other words, the open system of normal 9 preconditions and instituting action plans management practice will click into a closed 10 to counteract the precondition effects. system based on military-style organization 1 and co-ordination principles. In wider civilian 2 ‘In nearly every global disaster situation, it is terms where organizations must liaise with 3 the case that at some level or another, inform- local authorities, this means that the scalar 4222 ation was available which could have pre- concept which views an organization as a 5 vented the disaster from happening’, wrote group of grades arranged in sequence with 6 Allison in 1993. However, the information was the superior grades carrying authority and the 7 either possessed by those with authority to act lower grades carrying no authority, becomes 8 upon it but who did not act; or it was not pos- irrelevant. The unity of command will belong 9 sessed by those with the authority to act and it to the people trained as members of special 20 was not sought out by those in authority; or it emergency communication and continuity 1 was possessed by those who did not have the planning teams. 2 power to act on it but not shared by them with On 19 June 2003 the British government’s 3 the parties who did possess the authority to act cabinet office released a draft ‘Civil 4 upon it; or it was shared with the parties who Contingencies Bill’. For the ﬁrst time this will 5 possessed the authority to act on it but the par- provide a single statutory framework for civil 6 ties with the requisite authority did not take protection and emergency planning in the 7 the information seriously enough (p. 40). Thus United Kingdom. When enacted it is highly 8 the will to communicate relies to some extent likely that the bill will impose a duty to under- 9 on the existing culture of a bank and its avail- take risk assessments in respect of emergency 30222 able expertise not only in speaking and provid- planning. At local authority level, a major 1 ing information through the media during the emergency plan (MEP) is drafted in accord 2 crisis and afterwards but also in taking respon- with the agreed procedures and practices 3 sibility for ensuring the existence of free ﬂow- given in the Major Incident Procedures Manual 4 ing information through excellent continuity published by the London Emergency Services 5 planning. Liaison Panel (LESLP). The manual is made 6 This responsibility relies heavily on an available to all on the Metropolitan Police 7 understanding of chain of command when the website. 8 informal system of influence mentioned The MEP provides guidance to those 9 earlier is clearly inappropriate due to the responsible for managing and co-ordinating 40 impact of uncontrollable time constraints. the council response to a major emergency. It 1 During a crisis and particularly during a disas- is geared towards the set up of the Emergency 2 ter, each individual in the communication Co-ordination Centre and the roles of key 3222 operational chain must know to whom s/he is personnel internally and externally.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Due to the wide range of circumstances organizational activities are disrupted not only which a council may be called upon to deal internally but externally by what Florence and with, it is neither event nor site specific but is Kovacic (2001) call ‘the interconnected generic in nature. The flexibility that this actions of the major stakeholders’ and when approach assumes has stood the test of time. ‘organisational crisis truly become the public The MEP is supported by a department concern when defined and influenced by the emergency plan, which outlines the proced- mass media’. They quote Thurow’s conceptual ures to be adopted within each department. framework of ‘punctuated equilibrium’, Those departmental plans and those of their which depicts an organizational crisis as ‘rapid contractor partners, standardize the layout developments characterised by flux, this equi- and ensure a corporate style which everyone librium and uncertainty’. Zhu and Blood understands. MEP and departmental plans are (1997) offer a four-stage universal model: reviewed annually. For a local authority a major emergency 1 The build up or pre-crisis period where exists where the required council response, at the symptoms are detectable, such as the scene or elsewhere, is in excess of that repeated messages or persistent sets of which can be provided by the council operat- clues. ing under normal day or night conditions 2 Crisis breakout – acute crisis which are the and/or where special mobilization and organ- initial stages. ization of council services is necessary. 3 Abatement or chronicity of the crisis with Many emergencies are dealt with by charges, counter-charges, demonstrations, departments under their own departmental inquiries, legal actions and the continuing emergency arrangements, without the need to coverage by the mass media. activate the major emergency plan. However, 4 Termination where the organization whilst events which occur during normal attempts to get back to normal and where working hours may be dealt with perfectly the crisis is no longer a threat to an organ- adequately from within available resources, ization’s operational environment or its the same event arising during the early hours constituent publics. The media set the of the morning, or at the weekend, may agenda in terms of communication during require a major emergency response due to the crisis lifecycle. the reduced resources immediately available to deal with it. Third parties such as the media, play a key Back in 1916, the concept of forecasting role in assessing risk which evolves from and planning were called ‘purveyance’ by research and corporate intelligence. This Fayol who saw it as one of five divisions of the requires a high degree of trust and confidence administrative function, while administration as Figure 18.1 indicates. was one of six operations to be found in a business, namely technical, commercial, financial, security, accounting and administra- Managerial perception tion. Together these activities are what today we term management. However, Fayol could Communication managers often confuse risk never have imagined the complexity of man- assessment with risk perception during mes- aging organizations today when routine sage design and implementation, (Susskind

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Public confidence in scientists working for: powerful others; when people believe they 2 97% have been lied to or duped; and when people 3 strategically display anger to manipulate the 4 77% reactions of others. 5 64% Thus, conﬁdence in the quality of informa- 6 tion provision and in the perceptions of 7 management relies on what Sopow (1994) 8 calls the critical issues audit based on recog-

9 groups Environmental Government Industry nition of the main points (recognizable in 10 key phrases such as unique, new, ﬁrst, only 1 Media confidence in scientists working for: or last); in quality support through research, 2 73% evidence, studies and testing methods; and 3 through public linkages which emerge 4222 through what people say, what the public 5 41% demands and strong support (Regester and 6 38% Larkin, 1997: 32). UK consultants Regester 7 and Larkin’s 1995 UK research audit suggests 8 the organizational priorities based on cost and

9 groups Environmental Government Industry choice shown in Figure 18.2. A 1994 survey 20 of 250 British companies indicated that Who would you trust more to make the right decisions 1 about the environment? employees thought a crisis was more likely to 2 be triggered from outside the organization, 39% 3 rather than inside by management, as shown 4 32% in Figure 18.3. 5 Florence and Kovacic (2001) suggest three 6 models of crisis communication management. 7 Their market place model argues that crises 8 are caused and solved by economic, political

9 Euro-politicians UK government and legal competition; ideologically based 30222 models evolving new or evolving social move- 1 Figure 18.1 Monitoring the trust factor ments; and a public participation model 2 Source: Mori, 1995, Third party information expertise based on co-operation among governments, 3 private industry and the public. Because of 4 and Field, 1996). Perception plays an import- the signiﬁcance of mass media involvement, 5 ant part at every stage of monitoring and eval- these authors stress the importance of mes- 6 uation of public response. For example, sage strategies; by identifying stages in a crisis, 7 Susskind and Field (in Florence and Kovacic, message strategies can be more appropriately 8 2001: 84) suggest six types of anger requiring put together, up to a point. Of course, 9 different responses, namely: when people unknown variables make a positive risk-theo- 40 have been hurt; when people feel threatened retical view virtually impossible and so as with 1 by risks not of their own making; when people models of forecasting, empirical knowledge is 2 feel their fundamental beliefs are being chal- built up with experience so that an under- 3222 lenged; when people feel weak in the face of standing of the ‘probabilities consequent to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Figure 18.2 Information costs Legislative/regulatory (UK) and choices Environmental Source: Regester and Larkin (1997)

Safety

New technology

Legislative/regulatory (EU)

Political – change in UK government

Social

Industry specific

Economic

Legal

Sabotage, extortion and product faults 31%

Health risks, fire/accidents 16%

‘Dirty tricks’ and fraud 16%

Financial crisis 15%

Hurricanes, floods, pollution 12%

Figure 18.3 Pressure groups 10% Likely causes of crises certain actions’ takes place. The media affect Corporate governance people’s perception during the very first moments that they see or hear about a crisis With the rise of banks and other organizations and so one aspect is indisputable. The facts as techno-organizations, the signiﬁcance of have to be reliable and the attitude credible corporate governance is a popular media no matter how different the communication topic. Williams suggests that directors’ oaths code systems and styles are. would consist of sets of statements to ‘reﬂect The literature up to the mid-1980s focuses the director’s strong commitment to his or her on tactical PR activities and to a lesser extent, employees, the top priority of safety, the high on PR strategy as banks became increasingly ethical importance of communication and the technologically dependent. But something protection of that communication. A director’s else happened in the United Kingdom to oath might include statements that he or she create a paradigm shift and it begins here – as director is morally responsible for seeing to with corporate governance. it that both a will to communicate and a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 structure for communication are present in • Incorporate the Turnbull plan in the 2 the organizations.’ Ten years earlier, Allison organization’s management and corpor- 3 had suggested ‘the establishment of a ten- ate governance processes. 4 ured, independently funded safety board 5 which would possess veto power over opera- The author of the Report, Nigel Turnbull, 6 tional decisions which placed the lives of states ‘we have focused on producing practi- 7 employees or the general public at risk’. cal guidance that will ensure that the board is 8 Allison’s views were based on all of the disas- aware of the significant risks faced by their 9 ters which he studied where serious com- company and procedures in place to manage 10 munication breakdown occurred during the them. Executive management is responsible 1 crisis which had been openly acknowledged for managing risks through maintaining an 2 by ‘totally separate judges and investigative effective system of internal control and the 3 committees’. board as a whole is responsible for reporting 4222 The Institute of Chartered Accountants in on it.’ Public Limited Companies are expected 5 England and Wales (ICAEW) established the to have a solid internal control system in order 6 Turnbull Working Party to provide assistance to safeguard the investments of shareholders 7 to companies in implementing internal con- and the assets of the company. The effectiveness of internal controls has to 8 trol requirements including crisis management 9 be reviewed at least once a year and the risks strategies; a report was drafted in April 1999, 20 and issues a business faces should be regularly published on 28 September 1999 and be- 1 evaluated. Risk management, operation and came a statutory requirement in December 2 compliance and financial controls should be 2000. It represents the final element in a 3 part of a company’s review and the entire combined code on corporate governance and 4 board of directors is responsible for risk full compliance with the code became a 5 management. An organization has to keep 6 requirement for listed companies from 23 under review the requirement of an internal 7 December 2000. The combined code incorp- audit department and the contingency plan 8 orates the Turnbull Report, the Cadbury of the Turnbull Report was put together so 9 Report and the Hampel Report and suggests companies can focus on internal controls and 30222 key performance indicators as follows: specifically their crisis management pro- 1 gramme. The report states that ‘social and 2 • Obtain management co-operation. environmental factors should be included in 3 • Prepare a plan. risk assessments along with conventional/ 4 • Identify objectives. financial threats’. The report also recommends 5 • Prioritize the risk to the achievement of that listed companies radically review their 6 the above objectives. risk management programmes. Thus Nick 7 • Establish a risk management policy. Bent of Burson-Marsteller, a large PR consul- 8 • Consult through the organization. tancy, stated ‘the Turnbull Report means that 9 • Improve the culture of the organization, companies will have to take a broad, sophisti- 40 where and if appropriate. cated approach to risk, explicitly including 1 • Keep the whole plan simple and straight- environmental matters and threats to reputa- 2 forward. tion. Reputation is a key element of the intan- 3222 • Monitor. gible assets of a company and hence its value.’

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors The Turnbull Report encompasses issues closely and outsourcing companies now exist relating to electronic media now that stake- who will undertake search and monitoring on holders expect and demand information in behalf of organizations such as banks. The real time and email has raised the expecta- Investor Relations Society states ‘mishandling tions of shareholders regarding how quickly bad news creates a crisis of confidence in the companies respond. A typical contingency ability of a company to manage its affairs plan to meet the demands of the Turnbull properly. The result can be disastrous for report can be seen from Accenture’s business investors, employees and customers. In some risk management process. cases a company may never recover.’ The society recognizes that it is the responsibility of • Establish goals. the communication department to handle • Assessment of the risk. events in a professional manner. • Develop risk solutions. The London Stock Exchange points to two • Design and implement controls. levels to crisis management. The first level is • Monitor and feedback. where a company should look for anything • Improve the process. within its business that may cause a crisis, the second level concerns preparation for specific For the above six stages to be successful issues. For example, where a bank may be in Accenture notes that the quality of informa- the middle of talks concerning a takeover or tion is crucial for sound decision making. Each merger with another bank, it should be of the above stages must ‘generate and use assumed this news will be leaked to the time relevant and reliable information’. media. This sort of issue is relatively pre- Crisis management specialists, Regester and dictable and therefore plenty of preparation Larkin, state ‘in today’s complex environment, should and could be undertaken in the form organizations have to understand and of pre-prepared or holding statements for the respond rapidly to shifting public values, press and other media groups and prepara- rising expectations, demands for public con- tions and training of management on what to sultation and an increasingly intrusive news- do and say approached by the media or other media. This is particularly crucial when things parties requesting information. In a report by go wrong.’ the UK Department of Trade and Industry Brian O’Connell writing in the Investor ‘Creating Quality Dialogue’ (1998) it was Relations Journal suggests ‘the internet has an stated that only 21 per cent of fund managers estimated 2 billion pages of information and think that smaller quoted companies, for is growing at a pace of 100 million pages per example, are proficient at communicating month’. The main crisis arising from this trend information. Imagine how much worse that is the growth of bulletin boards or chat rooms. could be during a crisis. It is now possible for an individual to post The organizational crisis matrix in Figure any sort of information, accurate or inaccu- 18.4 suggests the extent to which different rate, on one of these sites and therefore spear parties have control over different types of illicit and inaccurate information about the crises at any given point in time. Each of the company and the management. This suggests crises detailed has the potential to damage the need for these sights to be monitored an organization’s reputation if the amount of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 control a company has over the outcome of information to all stakeholder groups where 2 of different types of crises is not recognized, previously certain parties received privileged 3 understood and addressed accordingly. information from which they accrued consid- 4 The Financial Standard Authority (FSA) erable advantage. It also aims to discourage 5 states in rule 39 ‘a firm should have in place ‘mosaic’ information which the UK Financial 6 appropriate arrangements, having regard to Services Authority describes as ‘information 7 the scale, nature and complexity of its busi- which, when pieced together with other like 8 ness, to ensure that it can continue to function matter, creates a material insight into the 9 and meet its regulatory obligations in the affairs of a company’. This carries consider- 10 event of an unforeseen interruption. These able significance after a crisis and for its 1 arrangements should be regularly updated reporting in a company’s quarterly reviewing 2 and tested to ensure their effectiveness.’ and annual report and accounts. 3 Companies face increasing amounts of 4222 regulatory information concerning disclosure 5 of information, which if not handled com- The continuity planning industry 6 petently by corporate communication experts 7 will attract attention during a crisis from finan- It is interesting looking through the case stud- 8 cial journalists and other interested parties. ies available through established business 9 For example, the Y2K Regulation Fair Dis- continuity planning websites such as Global 20 closure (Reg. FD) prohibits selective disclosure Continuity.com to observe how only now are 1 and requires the simultaneous disclosure of organizations beginning to understand that 2 material information to the general public even though many may have continuity plans 3 with disclosure to analysts or any other group. in place, the strategic and operational 4 The aim is to ensure a fair and consistent flow demands being placed on human corporate 5 6 7 Wide impact 8 Electronic sabotage Environmental pollution 9 Takeover threat Merger threat Corporate raids Poor financial results 30222 Product sabotage Customer accidents 1 Product defects 2 3 Not controllable Controllable 4 Terrorism Employee accidents 5 Kidnap of corporate Industrial action executive Breakdown of IT systems 6 Natural disasters New legislation 7 Sabotage of electronic 8 information Pressure groups e.g. 9 globalization 40 1 Local impact 2 Figure 18.4 A crisis impact model 3222 Source: Adapted from Fill, C. (1999)

Technology recovery

Business-process recovery

Crisis management

Customer-support operations

Facilities

Human resources

Procedures for key suppliers and partners

Public relations and damage control

Protection of intellectual property 20 40 60 80 100

Figure 18.5 Elements of a business continuity plan (BCP) Note: Multiple responses allowed. Base: 245 companies with business continuity plans. Data: Information Week business continuity survey of 350 business technolgy managers. Source: Information Week in Luftman (2003) p. 164 communication in the event of an invocation debriefings via their own training video. are not being addressed (Figure 18.5). Luftman (2003) argues that ‘recovery and Crisis management is often referred to as management plans should be tested at least issues management by organizations in order annually or twice yearly, with performance for a threat to appear less dramatic to prevent over-reaction by the media and panic by sus- Table 18.4 Nine steps to managing BCP ceptible stakeholders (Table 18.4). The most performance frequent potential crises many industries face, 1 Visualize the business functions (top-down especially the banking industry, are computer approach) viruses with the fear that one might one day 2 Itemize the tasks involved (bottom-up approach) cause the collapse of all computer systems 3 Prioritize work only on critical functions until they throughout the world. This Y2K crisis failed to are substantially complete 4 Categorize and organize the problems into materialize but large sums of money were management pieces of work spent by companies panicked into putting 5 Minimize the risk – the ultimate goal of business contingency plans in place. This involved continuity planning emergency training of staff and paying over- 6 Organize staff to react to emergencies as they time rates to IT employees for holiday pay. occur One Canadian bank for example, held a full- 7 Rehearse events so that staff are familiar with the planned responses day simulation in their residential training cen- 8 Sponsor/champion participation to demonstrate tre where nearly 500 senior staff participated. and communicate the importance of the recovery They used two of their PR staff to simulate the plan press, complete with professional video cam- 9 Vigilant monitoring of supply chain and partners’ era to inject a level of realism into the situation plans and to provide a tool for use at subsequent Source: Giga Group in Luftman (2003)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Routine strategy Disaster strategy Revised strategy 2 • Stabilized environment • De-stabilized environment • Restabilized environment 3 • Research inputs and outputs • Monitor inputs and outputs • Evaluate inputs and outputs 4 • Image control • Identity tests • Reputation management • Open system culture • Closed system culture • Open system culture 5 • Ordinary leadership • Extraordinary leadership • Ordinary leadership 6 • Proactive • Active • Reviewed statements 7 • Planned statements • Ad hoc statements 8 9 10 1 2 Disaster 3 Routine crisis communication Routine crisis 4222 communication command communication centre 5 6 7 8 9 20 1 Health and safety Marketing BCP Press and PR Operations HRM Monitoring internal Customer & supplier Initiation of Via prepared Managing Supervising 2 and external contact via prepared the continuity external press premises and employee help 3 socio/legal/ external phone line plan via wap and facilities power lines and 4 environment issues and facilities access phones and IT rooms including supplies via support services via mobile/radio/ monitoring and mobile phones via prepared 5 wap phones updating of and radio phone lines 6 internet and transmitters (from crisis intelligence control centre) 7 services and 8 liaison with local authorities 9 30222 1 2 3 Figure 18.6 The action stations framework: a co-dependency model (see also www.ukresilience.info 4 5 gaps identified and actively managed for tional contingency planners through Canadian 6 remediation’. Bankers Associations and the PR industry 7 From a banking perspective, the Y2K threat worked in co-operation with very effective 8 went through a number of phases in the results. They recognized the interdependency 9 United Kingdom as it did in Canada and else- with all types of ﬁnancial institutions, the stock 40 where. The ﬁrst was the fear that each bank’s markets and the specialists who move money 1 own computer system would fail. This resulted around. They worked closely with other 2 in a massive effort to inspect and if necessary co-dependent organizations who were 3222 correct every line of code. However, opera- important to the industry’s infrastructure such

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors as electrical supplies, voice and data commun- longer-term implications are clear. UK ications experts, transit systems for staff, build- bank accounts will be hard for internal and ing, heating and air conditioning experts, external fraudsters to resist if sophisticated elevator or lift service companies (Figure ‘man and machine’ security measures are not 18.6). embedded in corporate communication plans Another area of concern was public percep- underpinning continuity planning training tion. Although the industry appeared to be on policies. top of the problem, naturally banks could not Corporate communication lies at the heart anticipate the degree to which the public of all commercial operational activity but might draw out cash and overload individual especially where organizational security is banks’ ability to respond. The Canadian Bank- concerned. This demands excellence in inter- ers Association, traditionally a low-profile nal communication practices from the top damage control type of organization, became as well as excellence in driving external proactive in developing a strategy to make PR programming and everyday corporate sure it had well briefed representatives wher- affairs. An organizational climate that can ever banking issues of Y2K were likely to be demonstrate that its people work well discussed, whether in national media or in together, stays together during a crisis and schools. It developed a new website and overcomes setbacks more quickly. Sabotage issued explanatory leaflets through their Y2K born of internal strife or unethical behaviour, public affairs working group. While one of the can rarely be dissociated from an organiza- benefits of new technology has been the 24/7 tional culture which may have preceded or facility that databases provide via websites, triggered a crisis in the first place. cyberspace can also be a threat. While the internet may be a useful monitoring tool for information gathering it also creates narrow Three learning organizations costing and a demand for highly skilled practitioners who can monitor and disseminate Case 1: First Interstate Bank proactively, critical intelligence that will affect an organization’s reputation or security. At the First Interstate Bank in the United For example, the fastest growing crime in States, a fire which rates as one of Los Angeles’ the United Kingdom currently is identity biggest, took hold at their premises in Los fraud. The UK fraud prevention service, Cifas, Angeles’ tallest building. The bank came close reported 75,000 cases in 2002 alone, an to losing the entire building and although the increase of 55,000 in just three years. It incident took place in 1988, it is still used as a is almost solely due to non-personalized training case study because for the business banking communication where security meas- continuity community, this fire rates as per- ures lag behind criminal activity. It could be haps the earliest, it not the best documented seen as tantamount to negligence by the example of a business continuity plan in banking industry – possibly a typical case action. Being in an earthquake-prone area, of bringing to a competitive market some- First Interstate had set up a business resump- thing before it or management is ready. With tion planning unit and developed a business call centres set to increase in number but resumption plan which had been tested just moved to economically weaker countries, the weeks before the fire. They were helped by a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 consulting group who had had experience Practical measures followed which included 2 during the NorWest Bank fire in Minneapolis the setting up of a media centre with twenty 3 six years previously. Over two thousand staff phones by 6 am the morning after the fire, 4 had to be relocated during the outage. including a customer hotline and arrange- 5 First Interstate’s plan centred on an emer- ments that allowed cameras and reporters to 6 gency operation centre (EOC) as the hub for interview and take photographs. One witness 7 decision making. They had six EOCs across said ‘I seem to remember that they had the 8 California which included regular conference CEO being interviewed for American AM out- 9 rooms with enhanced communication and side the burned building at 6 am.’ They were 10 media watching equipment. They had a regu- able to be confident because the personnel 1 lar staff of about six who would service the involved knew the business continuity plan 2 EOC and this was increased to twenty around and the people running it and were party to 3 the clock, using volunteers during the inci- new information as it became available. 4222 dent. Public affairs and employee information Despite the fact that the bank did not have the 5 were seen as a single responsibility given that full picture when they went to press, it felt 6 employees and their families would see confident enough to initiate an interview that 7 what was in the media and so should get the went out live and uncut. Thus the media were 8 same message from the bank. Because public able to put the emphasis on recovery to 9 affairs and internal communication staff were counter the visual image of the burning build- 20 regarded as a special team within the business ing. This is only possible if there is confidence 1 resumption plan and because they had that the facts can and will back up the story. 2 recently participated in business disruption The image portrayed was that of a wounded 3 exercises, they were called soon after the inci- giant getting back on its feet because it had a 4 dent at 1 am on the night of the fire. plan to do so. The media also became import- 5 This would be normal practice in PR terms ant in messaging the thousand staff in the 6 but often gets forgotten during a disaster tower not to go into work, but to wait for 7 when the corporate culture is tested to its instructions. After this success by the First 8 limit. The plan decided upon was as follows: Interstate PR department a new phenomenon 9 arose. The media’s attitude changed and 30222 • There would be a general policy of questions were raised. Was this arson because 1 honesty. some traders had been dismissed before and 2 • There was a need to anticipate areas of the fire started in the trading room? This 3 vulnerability, such as the issue of having was never proved. Another question related 4 no sprinkler system. The bank was to the structure of the building. Was it now 5 installing one at the time. sound, because it had to be stripped back to 6 • It was important to deal with perception bare steelwork. This proved to be okay. The 7 issues such as the loss of headquarters media centre was updated with news every 8 and therefore the loss of the bank’s ability twenty minutes and briefed about the 9 to serve its customers. approach to take in response to the questions 40 • They must proactively provide the media that were being asked. The small PR depart- 1 with a ‘we’re still in business’ angle so the ment had to suddenly grow and deal with 2 incident became a positive story rather searching questions over a prolonged period. 3222 than a negative one. It had to consistently anticipate which

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors direction the media would take so that they after restoration because they feared it was could be ready and proactive. While dealing still unsafe. Other issues which emerged with the media, there were other stakeholders related to an initial requirement for the ma- to deal with, such as customers. First Interstate jority of staff to stay at home. There were anticipated what we now term call centres by managerial concerns that staff would not pull at least ten years. Some of the most frequently their weight, while families were anxious as to repeated dialogues related to customers con- whether they might not get paid. Informa- cerns about the safety of their savings and tion had to be provided on a regular basis to access to their safe deposit boxes. It is on such show that they were not forgotten and a con- fundamental enquiries that longer-term repu- tact number issued for staff to call to raise tations hinge. any question, however trivial. The questions The bank had 10,000 employees who raised by staff were monitored so that the played a critical PR role during the crisis concerns could be identified and addressed ensuring that journalists were referred to the collectively or individually. As a consequence media centre, for example. Wrong or inappro- First Interstate Bank established an employee priate responses to the media can be danger- communication co-ordinator in each division ous to an organization’s credibility rating, not who was reliable, available and accessible on to mention that of the employee. There are a 24-hour basis. They compiled lists of home also legal and insurance implications which numbers of all staff with priority for core often focus on statements to the press and management. Within eight days of the fire, a film recordings of the first three days. The first newsletter was circulated to all affected news employees and their families get is often employees and this continued on a twice from the media who may set the tone for an weekly basis for the first few weeks. Copies entire recovery period which in Interstate’s were sent to recovery centres and continued case was up to 18 months. Public perception to be issued on a regular basis until all had naturally also has investor implications. In this returned to the damaged building with the case, while the stock market went down 16 question and answer section proving to be of points on average the day after the fire, First great value. However, although employee Interstate shares only dropped three-quarters morale was high on their return in the first few of a per cent. Messages to the media were fac- days after the fire, this soon deteriorated tually based and the bank had a plan for when they found they were working in un- ongoing media interaction over a prolonged familiar locations, in makeshift workstations period. Employees can make or break the best or not working at all. Many also had different of plans where the psychological impact of a travel patterns, longer or different hours of prolonged outage is great but the effect can work and apart from direct assistance where be mitigated by effective communication. necessary, the newsletter came to be an essen- Internal employee communication must be tial way of counselling (Figures 18.7 and consistent with external communication and 18.8). what is heard through the media. Families The communication and PR staff them- have a major influence during a crisis and are selves were not immune from fatigue and often less tolerant than the staff themselves. depression, so directorates need to be aware Indeed at Interstate some family members of the impact on all staff and themselves. This tried to stop staff returning to the building positive case study is very different from that

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 First interstate: normal organization 2 3 Executive 4 5 Security 6 Legal 7 Dept. Human 8 heads resources 9 IT 10 Public affairs 1 2 Facilities

3 Finance 4222 Business Figure 18.7 units Business 5 First Interstate: normal continuity 6 organization 7 8 9 First Interstate: emergency organization 20 1 Emergency Business security recovery 2

3 Bus. units Security Bus. cont Pub. aff HR Facilities IT Legal Finance 4 Emergency Mgt 5 6 Bus. resumption 7 Media/emp info Executive 8 Damage assmt. 9 30222 Dept. Dept. Communications heads heads 1 Med/psy. pers 2 Security 3 Business Business Figure 18.8 First 4 units units Transportation Interstate: emergency 5 organization 6 7 8 of another bank fire which took place in the publicity when a fire got out of control. Three 9 centre of Philadelphia in 1991. The Meridian firemen died and there was considerable 40 Bank, situated in a 38-storey bank tower with media concern for customers that the bank 1 the Meridian Bank logo prominently dis- and their money were in trouble. Even though 2 played and only 300 staff in the building, the bank were not the major tenant, nor 3222 were not able to defend themselves from bad responsible for the fire, their trademark was

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors on top of the building. Meridian were fre- communication or public affairs department. quently maligned by the media, resulting in Interstate’s plan was flexible enough to be loss of public confidence and market share. adapted to an unthinkable situation and first First Interstate was organized much as any Interstate’s executive didn’t get in the way of other major corporation with business units the execution plan. The worst thing that can delivering customer service and specialist happen is that executives, who have not gone departments providing support, all under the through the training, pull rank and overrule watchful eyes of the CEO. Public affairs and the experts right in the middle of the crisis human resources staff supported the media itself. and information team. For business continuity to work, it has to be accepted as a management discipline that Case 2: Allied Irish Bank takes a commitment of resources. The AIB group (UK) plc is a wholly owned sub- First Interstate: lessons sidiary of Allied Irish Bank plc and is incorporated in Belfast. The company operates in • Business continuity is a management dis- Britain under Allied Irish Bank GB and under cipline – not a project. First Trust Bank in Northern Ireland. It is the • Business continuity is a multidiscipline largest Irish banking and financial services concept requiring buy-in from all areas of group and is made up of four main areas: risk management. AIB Bank, United States of America, Capital • It is not enough for individual business Markets and WB Kay/Bank Zacodni (Poland), units to have their own plans – co-ordina- AIB ranks among the top 25 banks in Europe tion is required for major incidents. and was quick to recognize that in a crisis its • Plans must be flexible to handle unex- main concern would be to manage its reputa- pected events. tion. The bank has won the forum for best • Develop experts and trust them to activate business bank four times in succession. This the plans. was carried out by a survey of nearly eight • Trust comes from exercising the plan. thousand businesses and they ranked Allied • Executing a plan well is not enough – all Irish Bank number one, well ahead of other stakeholders have to know that their inter- high street banks. The bank relies on its repu- ests are being taken care of. tation and by winning this award are able to market this aspect of their image and identity. Although it might be thought possible to The bank has stringent procedures in place create a specialist unit to manage the practice for dealing with evacuation, salvage and of business continuity in the organization – it recovery in the event of a crisis. These proced- cannot operate in isolation. It must be a cog in ures should be seamless, that is, the change- a risk management machine. Many organiza- over should not be seen from the outside. tions that succumbed to the marketing However, it does not deal with major crises edicts of the 1980s pushed business continu- and the handling of media, where staff have ity responsibility down to individual business been injured or customers affected. They units, forgetting that a major incident calls for therefore use case studies guidelines from the overall co-ordination through the corporate British Home Office and the global continuity

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 websites to develop their policy and guide- best practice to meet regulatory requirements 2 lines; they used a step approach such as the and observe internal standards and obliga- 3 one described above to do a qualitative tions. The policy was both practical and 4 analysis and then address the issues of worst applicable to all businesses within Britain, 5 case scenario in managing crisis communica- while sufficiently flexible to cater for change 6 tion such as only starting work on a potential and the impact it has on the continuity risk. 7 crisis after it is made public, letting your repu- The policy was endorsed by the group BCM 8 tation speak for you, treat the media like Committee as providing a process for the 9 the enemy or getting stuck in reaction versus consistent delivery of a proven, documented 10 being proactive and many others. They looked and up to date business continuity. 1 at corporate behaviour, interpersonal and The chair of the BCM steering group acti- 2 group communication, the organizational vates the communication team who will keep 3 culture, the formal levels of communication abreast of potential issues through monthly or 4222 and the problems that may bring during a quarterly meetings. The Steering Group has 5 crisis, although the bank had communication communication organizational structure and 6 guidelines for their public relations strategy, people in place so that after a decision is 7 they found the exercise and existing policy did made to activate crisis capability, internal 8 not deal with the communication media re- teams meet to determine the actions and 9 lations in the event of a major international the implementations of assignments. Once 20 crisis in respect of a media relations policy. the plan is activated the team maintains con- 1 In April 2001 they submitted a communi- stant contact updating assignments and 2 cation and media relations policy, specifically plans as necessary until a decision is made to 3 for business continuity management, which is deactivate. 4 an integral part of Allied Irish Bank’s oper- It was decided that the invocation proced- 5 ational risk management strategy. The policy ures would be as follows. Business would 6 established an effective and consistent frame- continue as normal if the system or building 7 work for BCM communication and media failed or was down for a portion of one 8 relations across Britain in line with leading day. However, the BCM team would meet if 9 30222 Table 18.5 Communication channels 1 2 Internal only Stakeholders 3 Medium Instruct Inform Listen Consult Involve Empower 4 5 Alimail ••••• Internal only 6 E-mail/internet ••••• All 7 Video • • N/A Telephone •••• All 8 Newsletter • • All 9 Letter • • All 40 Circulars/memos • • Internal only 1 Team meeting •••••• Internal only 2 Briefing ••• All 3222 Source: Fill, C. (1999)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors the system/building failure was down for a full A series of incidents day and the communication team would meet with crisis management to authorize United States invocation if systems or building failure went • World Trade Centre bomb beyond one day. A communication personnel • Oklahoma city bomb decision-making tree was established for both • Earthquakes (LA and SF) inside office hours and outside office hours • Hurricanes Andrew, Fran and the communication channels established • Midwest floods as shown in Table 18.5. The checklist identifies tasks that teams or Canada individuals may be called upon to perform and the performance measures expected from • Days of protest the team were also established. Press briefing • Red River flood locations to be used were identified and the • Great ice storm stakeholder contact list was issued, which • Brush fires included television news agencies, the press, • Demonstrations the regulators and others. A training pro- • Power outages gramme is in place for taking control of a • Telecom failure crisis, understanding initial response options • Christmas tree fire and other general guidelines such as co-ordination, briefing the news media, including Overseas likely media questions and enquiries, the rules • Hurricane – Jamaica for radio interviews and press releases, train- • IRA bombs – UK ing for the spokespersons and interview • Power outage – NZ record keeping with questions and answers to be used for evaluation and research for con- Y2K tinuing improvement. The Y2K preparations brought these to a head, not only within their own organization, but as a collaborative effort for the whole Case 3: Scotiabank Canadian and international financial community. The interesting thing to watch was the Scotiabank is a $240 billion international progression of the threat from that of a tech- bank, operating across Canada and in fifty- nology failure, to that of an infrastructure fail- five foreign locations. It is one of ten office ure, to one of public confidence failure buildings in downtown Toronto housing about leading to the banker’s traditional nightmare 6,000 staff. It has sixty-eight floors compared – a sudden huge demand for cash. Thus the to First Interstate’s sixty-two. emphasis in the final months of 1999 in They set up a permanent BCM unit in 1989 Canada was on aggressively managing public after analysing a series of major events in the attitudes – which led to an unprecedented United States and overseas which they exam- joint PR exercise for the Canadian Financial ined for business continuity issues and lessons Institutions orchestrated by the Canadian to be learned. Bankers Association.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Thus, a number of the bank’s informal re- occupied by one of their competitors, the 2 lationships developed which were reinforced Royal Bank. In order to put water onto the 3 by a number of actual operational incidents. fire, the fire chief ordered the electrical supply 4 Past semi-formal relationships between the to be cut which also cut power to the smaller 5 business continuity management unit and PR of the two towers belonging to Scotiabank, 6 unit had to be formalized to the process as because it is fed from the same transformer. 7 part of the Scotiabank emergency response In fact, both Royal and Scotiabank immedi- 8 plan. The plan involves the use of two teams ately activated their business continuity plans. 9 which look after Scotiabank’s interests as a Scotiabank evacuated twelve hundred people 10 tenant when incidents occur in their main and Royal Bank evacuated nearly a thousand 1 office towers in downtown Toronto. One people. The media greatly underestim- 2 team, Scotiabank InformationCommunication ated the number of people affected but also 3 and Analysis Team (SICAT) collects informa- assumed that everyone was simply sent 4222 tion on the situation, analyses it for validity home. The PR spokesperson called the re- 5 and implications to the bank and presents it to porter and explained the situation after being 6 the second team (Scotiabank Emergency briefed by the business continuity planning 7 Response Team, SEMT) for them to determine director, Rex Patterson. The result was a much 8 the best overall strategy for the bank for that more positive report the following day. In the 9 particular situation. SEMT has two compo- meantime Royal Bank had not proactively 20 nents. The prime team is made up of the main managed the media and did not come out 1 decision-making responders and includes of the incident so well. In the Toronto Globe 2 security, facilities, insurance, business continu- and Mail dated 22 June 2000, they quoted the 3 ity and the vice president. SEMT secondary Scotiabank’s senior manager of public affairs 4 members are called if the situation warrants it as saying ‘the fire has been an inconvenience, 5 and include public relations, human but it hasn’t been disruptive’ whereas the 6 resources, general council and IT. newspaper said of the Royal Bank that the 7 Under the plan, each department provides incident had a silver lining for at least one res- 8 a main member and two alternates who are ident: ‘I got in and found out I had the day 9 on call 24 hours, 7 days a week, contact is off. It’s the first day of summer. You can’t go 30222 made at random once a month, and the time wrong’, one Royal Bank employee said. 1 to establish contact is recorded to ensure it is Scotiabank has set the standard in Canada 2 within acceptable time frames, members also after being given a brief to develop a compre- 3 undertake to take part in two exercises a year hensive formal emergency management capa- 4 using realistic scenarios, the plan is tied into bility in autumn 2000. Their first job was to 5 that of the building managers where they are come up with a methodology that would 6 located to ensure that all share the same underpin their plans, which made sense if 7 information and is thus formalized. This is par- they broke them down into nine distinct 8 ticularly important if the bank’s spokesperson stages as shown in Figure 18.9. Some of these 9 and the building management spokesperson may run concurrently and some may never be 40 are to give the same story and not create invoked if the emergency does not develop 1 confusion in the media. For example, there into a major outage. However they were able 2 was a fire in the electrical feed vault outside to develop protocols for each stage that pro- 3222 the building adjacent to the bank which was vided them with common starting points.

Incident stages

Alert Plan activation

Information Decision gathering making

Control Analysis

Information dissemination

Stand down Debrief Figure 18.9 Scotiabank’s incident response

Scotiabank’s emergency management the issues the bank came across in turning the organization (Figure 18.10) bears a strong model into a reality meant having teams that resemblance to the First Interstate model. It can convene rapidly in time of need. Team has a core group of decision makers made up members have to agree to being on call on a of senior members of their real estate (facili- 24-hour basis, 7 days a week, and part of that ties), security, insurance and operations agreement is to participate in random contact departments. This core group can be rapidly tests on a regular basis. expanded to pull in senior members of public The bank realizes that it is possible to teach affairs, human resources, communication ser- theory but instincts (or panic) tend to take vices, network support, and legal depart- over in a crisis. They issue each team member ments. Designated members of these teams, with a red book of checklists and other and their alternates agree to be on 7/24 call. information to guide them when called. For the decision makers to make effective This information is now downloaded onto decisions they must have the best available Blackberry hand-held devices. Decisions must information and if the decisions are to have an be made on sound information. Typically in a impact they must be communicated. This only major incident there is an overload of inform- works if there is a group dedicated to this task ation and very reliable facts. It takes knowl- and not involved in responding to the inci- edgeable and dedicated people to create dent. Known as SICAT it is made up of the ‘intelligence’ from the information available members of the business continuity manage- and this, of course, is a key discipline in the ment (BCM) unit plus a number of volunteers armoury of the professional communication who train with BCM and are also on call 24/7. specialist, who knows that gathering informa- Neat diagrams are not enough to provide tion is one thing – making sure it gets to those an emergency response capability. Some of who need to know is another.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Scotiabank emergency management team 2 Decision making 3 4 Primary Secondary 5 6 7 8 RE S&I RM&I Ops HR PA GC CS NS 9 10 Scotiabank incident communication and analysis team 1 2 Primary Secondary 3 4222 5 Figure 18.10 Scotiabank’s 6 approach to emergency BCM unit Volunteers 7 management 8 9 20 1 Five stages of an incident This information is fed to the communication 2 and analysis team who also monitor the 3 Each team member has all the instructions for media and internet as appropriate (Figure 4 carrying out their tasks either on a hard copy 18.11). 5 ‘red book’ or on a Blackberry hand-held Raw information is not enough. It has to be 6 device. Somehow, somewhere, someone checked for accuracy and relevance to the 7 becomes aware of an actual or possible inci- bank by the communications and analysis 8 dent and calls a member of one of the teams team. They will also check on the business 9 (or both). The person contacted uses their units’ BCPs and if they are being actioned and 30222 checklist to review what they have to do and this information is put onto the standard 1 how to do it. There will be a contact between status format and transmitted to the Black- 2 the two teams and a decision to activate the berries and PCs of the emergency manage- 3 alert. A time for a conference bridge is set. ment team. A meeting of the emergency 4 Scotiabank use a broadcast telephone alert management team or another conference 5 system (Alertcast) to rapidly alert all team bridge is initiated and an overall assessment 6 members. At the same time they activate their of the situation made in a standard format. 7 status line so staff can check that the BCM Unit From this an overall strategy is drafted (using 8 are aware of a situation. Designated team a checklist) to provide overall guidance and 9 members have the information at hand to do support to the impacted business units. This is 40 this. Once the teams are alerted they usually presented to the bank’s executive for approval 1 need more information. The Blackberry pro- (Figure 18.12). 2 vides a list of what information may be Now the organization is ready to get a con- 3222 important and who might be best to obtain it. sistent and proactive message out to all

Info source Communications Emergency management and analysis Incident 1st notified alert Phone

Phone 1st notified

Alertcast to convene SEMT Activate the status line

Respond

Information FLASH! gathering

General Figure 18.11 status line Scenario: phases 1 and 2

Scenario: phases 3 and 4

Info sources Communications Emergency management and analysis Situation updates

Media

Status updates Status email

Business units activating BCPs Situation assessment

Strategy

EXECUTIVE

Figure 18.12 Scenario: phases 3 and 4

5 SICAT info. PR/HR info. 6 dissemination dissemination 7 Press Newsletters 8 General releases Email 9 status line 10 Web page Intranet 1 2 3 Displaced staff 4222 Business units 5 activating BCPs 6 Figure 18.13 7 Scenario: phase 5 8 Media Newsletters 9 20 stakeholders. If you have had to face the All are important but the crucial communica- 1 media before this point you have been able to tion element continues to maintain, monitor 2 say with some confidence that your organiza- and prioritize relations with all stakeholders. 3 tion has plans in place to deal with any dis- Organizations are conscious of the import- 4 ruptive situation and that those plans have ance of business continuity capability to cope 5 been activated. Now you are armed with an with increasing numbers of business disrupt- 6 approved strategy to deal with this particular ing incidents. 7 situation which you can show is being man- Scotiabank found that individual plans are 8 aged – not just reacted to. The bank works to not enough. Responses must be co-ordinated 9 checklists that have been developed through and that depends on excellent communica- 30222 experience. Several methods are used – all tion. Many organizations put such a capability 1 using the same source, namely corporate in for Y2K only to abandon it afterwards. 2 communication and PR interfaces with the 3 media. For a prolonged outage, human 4 resource management will interface with staff, Best practice 5 including those who have been told to stay at 6 home. Meanwhile the communications and Corporate communicators realize that recov- 7 analysis team is interfacing with the business ery demands that all stakeholders know about 8 units making sure that they are kept abreast of it and the organization must go beyond 9 what is going on, using predetermined guide- damage limitation if it is to profit from any 40 lines (Figure 18.13). disasters afterwards. The lesson learned is that 1 The remaining four phases deal with the strategic communication strategy is only as 2 management and control of a prolonged valuable as the organization’s culture and 3222 outage, the return to normal and debriefing. capacity to cope functionally during a disaster.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors As vice president, Rex Engstrand, director of • Why should my company be of interest Wells Fargo and Company corporate business to the media? continuity planning office, once said about • How can my company prepare, in the value of uninterrupted service: advance, to deal with the media? • In a crisis how quickly will the media our mission is to contribute to the contin- respond? ued success of the bank by providing guid- • What is the impact of this instant press ance and support to each business unit. Our response? BCP plans are designed to safeguard and • How should my company deal with the protect personnel, customers, cashflow and media in the immediate aftermath? long-term market share in the event of an • What should the response of our senior unplanned interruption to our business. spokesperson be? The advancement of technology has driven • What happens if we refuse to co-oper- new solutions that were not available in ate with the press altogether? recent years. I believe as we proceed into • Who should tell the press any really the future, we will see continued blurring bad news? of what differentiates the technology plan • How should my company help the rel- and a business unit plan. atives of anyone killed or injured where the press are concerned? Interestingly what he does not refer to on his • How should we handle the recall of webpage article, published in February 2001, products? is the role of corporate communication. • What about the practical side of deal- The corporate communication industry is ing with the media on the ground? very aware of this and specialist services are • What are the pros and cons of radio, popping up overnight in recognition of the television and newspaper interviews fact that wherever human dramas or tragedies and how do they differ? are played out, the press will be there. The • What do the local/regional press want Press Alert Organization have issued a press from us and what is their role? pack of do’s and don’ts which offers advice • What do photographers want from us? and information that they say applies just as • What if the international press are well to the financial crisis, whether involving involved in covering a crisis? fraud, business collapse or a hostile takeover • What should we do when the press bid. They offer a checklist of twenty principles point the finger of blame at us? or questions that need to be asked when plan- • What happens when a VIP visits the ning communication as part of a business con- crisis scene? tinuity plan: • How should my company react to a concerted media campaign from a pressure group? • How will the story be reported in the long term? • What should be done after the crisis to media plan for the future? Source: Press Alert

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Conclusion board directors. (See Action Stations Frame- 2 work on p. 289). 3 These three cases indicate the level of strategic The reward will be that the monitoring and 4 underpinning that is critical to organizational evaluation of organizational performance 5 disaster management. The corporate com- before, during and after a disaster through 6 munication strategy should operate like clock- first-class communication could be seen to be 7 work. Organizations must have simulated not only best practice, but impressive. Post- 8 training events to ensure that all members of disaster feedback from all stakeholders should 9 the emergency and continuity planning team be audited and measures of image, identity 10 know how to behave and conduct themselves and reputation carried out on a regular follow 1 in relation to the corporate communication up basis so that quantitative and qualitative 2 director, who is accountable for best practice data can be fed into future communication 3 for the duration of a disaster and immediately decision-making processes and plans. 4222 afterwards. This includes updates and changes Based on classical theories of action centred 5 to previously evaluated PR policy schedules. leadership and occupational psychology 6 Like regular fire drills, simulated events should principles of co-dependency approaches to 7 be seriously undertaken and assessed on a corporate governance, competent continuity 8 regular basis, with all staff involved including planning performance management would 9 the core group of continuity planning, com- include training models such as the action 20 munication and PR professionals and main stations framework (Figure 18.6). 1 2 3 NOTE 4 5 The author is greateful for the contribution made to 6 the case studies by practitioner colleagues at Bank of 7 Nova Scotia (Canada) and AIB (UK). 8 9 30222 BIBLIOGRAPHY 1 2 Allison, R. E. (1993) Global Disasters: Inquiries into lenge for communication practitioners’, Corpor- 3 Management Ethics, New York: Prentice Hall. ate Communication International Journal, 2(2). Fayol, H. (1949) General and Industrial Administration, Hutton, J. G. (2001) ‘Defining the relationship be- 4 London: Pitman. tween public relations and marketing: Defining 5 Fearn-Banks, K. (1996) Crisis Communications, the practice’, in R. L. Heath (ed.), Handbook of 6 Mahwah, NJ: Lawrence Erlbaum. Public Relations, Thousand Oaks, CA: Sage 7 Fill, C. (1999) Marketing Communication, 2nd edn, Publications. 8 New York: Prentice Hall. Liew, J. (1997) ‘Banking on a sharper image?’, 9 Florence, B. T. and Kovacic, B. (2001) ‘Intersections Corporate Communication: An International Journal, 40 between crisis and management’, in D. P. Cush- 2(2), 76–86. man and S. S. King (eds), Excellence in Com- London Stock Exchange (2000) A Practical Guide to 1 municating Organisational Strategy, New York: Listing on the London Stock Exchange and A 2 State University of New York Press. Practical Guide to Investor Relations, London: Stock 3222 Gaved, M. (1997) ‘Corporate governance: The chal- Exchange.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Luftman, J. N. (2003) Managing Information Tech- Regester, M. and Larkin, J. (1997) Risk Issues and Crisis nology Resource: Leadership in the Information Management, London: Kogan Page. Age, Harlow: Pearson/Prentice Hall. Sopow, E. (1994) ‘The critical issues audit’, in Register Olaniran, B. A. and Williams, D. E. (2001) ‘Antici- and Larkin (1997). patory model of crisis management: “A vigilant Susskind, L. and Field, P. (1996) Dealing with an Angry response to technological crisis”’, in R. L. Heath Public: the Mutual Gains Approach to Resolving (ed.), Handbook of Public Relations, Thousand Disputes, New York: Free Press. Oaks, CA: Sage, Chapter 41. Thurow, L. C. (1996) The Future of Capitalism; How Oliver, S. (1997) Corporate Communication: Principles, Today’s Economic Forces Shape Tomorrow’s World, Techniques and Strategies, London: Kogan Page. New York: William Morrow. Oliver, S. (2000) ‘Symmetrical communication: does Williams, H. M. (1997) ‘Financial relations’, in O. W. reality support rhetoric?’, Corporate Communica- Baskin, C. Aronoff, D. Lattimore (eds), Public tion: An International Journal, 5(1), 26–33. Relations: the Professions and the Practice, Oliver, S. (2001) Public Relations Strategy, London: Madison, WI: McGraw Hill. Kogan Page. Zhu, J. H. and Blood, D. (1997) ‘Media agenda set- Pearson, C. M. and Mitroff, I. I. (1993) ‘From crisis ting; telling the public what to think about’, in prone to crisis prepared’, The Executive, 7. B. Kovacic (ed.), Emerging Theories of Human Price Waterhouse Cooper (2000) The Technology Race: Communication, New York: SUNY Press. the 2000 European Benchmarking Study for Technology Companies.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 19 2 3 4 Crisis management in the internet 5 6 mediated era 7 8 David Phillips 9 10 1 2 3 4222 5 This chapter looks at crisis and issues management from an internet mediated perspec- 6 tive. It examines how transparency, porosity and agency inﬂuence both the nature of 7 issues and crisis and how they extend the range and speed which such corporate prob- 8 lems can materialize. By reviewing how internet tools such as email and web pages can 9 be deployed in an escalating crisis situation, the author shows how the internet can be 20 applied (or not as the case may be) to aid crisis management. Finally the chapter looks 1 at a range of internet crises faced by a variety of organizations that have occurred in 2 recent years and offers some ideas for planning against such eventualities. 3 4 5 6 7 The nature of crisis direct responsibility and training or, often, 8 good common sense. It may be an event The nature of organizational risk has two ele- 9 that requires the co-operative effort of more ments and it is worth dwelling on them and 30222 people and which may require bringing their nature to help understand the range of 1 people in to work from home or it may re- concerns that need to be considered in crisis 2 quire a team of colleagues and outside and issues management. The elements are: 3 agencies/contractors. At its worst, a crisis can 4 • crisis which threatens the survival of the be because of a major sudden disaster. 5 company/organization; Alternatively, a crisis can be caused through 6 • an issue which is a normal process of an issue running out of control. This form of 7 management which is an exception to latent crisis is by far the most frequent cause 8 daily routine. for corporate disaster and is also, by far, the 9 most difﬁcult to manage. 40 Crisis The best defence against most crises is in 1 the effective day by day management of 2 A crisis can be sudden and unexpected which issues. 3222 can be handled by a person on the spot with

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Issues and identified with assets related to the information revolution. This can include a Issues management is part of the daily pro- website, email, SMS, WAP and downloads cess of PR practice. The situational theory of and viruses. In addition, the wider public can publics defined by Grunig (1982)1 outlines quickly form pressure groups and affect three characteristics that affect how publics corporate security. react to issues: problem recognition, con- The public’s perception of internet inform- straint recognition and level of involvement. ation security focuses on external online gossip, rogue sites and hacking (which are, 1 In recognizing a problem, he proposed, nevertheless, a problem), the Rand organiza- people will actively seek information tion identified that the majority of online about the issue that concerns them and/or compromise comes from within. record (or process) information that comes The insider with access and authority to them unsought. to information can, through incompetence, 2 Constraint recognition describes the extent inadvertence, accident, purposefully or mali- to which people believe there are obsta- ciously compromise an organization very cles that limit their ability to fulfil their easily. In addition, information now flows plans. through organizations as never before and 3 Level of involvement means the extent many employees are not trained or convers- to which a person feels connected to a ant with their online responsibilities. Lapses in particular situation and will determine security are a very common cause of the whether they are likely to act or not. emergence of issues. Preventing digital security lapses is incumbent on all employees Grunig and Hunt (1984)2 say that when an (and external contractors and agents). This organization or its publics behave in a way can be as simple as not sending emails to that has consequences for each other, they external people that include prior content create PR issues. When affected people from someone else. Occasionally, organiza- choose to react, they become members of a tions will find that a hacker is intent on break- public. Publics form around issues. ing into corporate information and so good By preparing for, and managing issues defences by way of firewalls and virus protec- corporate response reduces the probability of tion are very important. With the advent of crisis threatening the organization. internal email, information flows between departments and up the hierarchy of organ- The internet information structure ization with great ease. Historic departmental and seniority barriers have come down The Rand Research Brief ‘Strategic War in (Figure 19.1). Cyberspace’ for the US National Defense In addition multidiscipline groups are Research Institute in 1995,3 says ‘National formed on a project basis using internal email Security is becoming progressively more depen- and other technologies which provide for dent on and identified with assets related to the greater information flows between depart- “Information Revolution”.’ As for the United ments and also offer the means for informa- States, so for every organization. Company tion to ‘leak’ to the outside world into trusted security is becoming more dependent on partner organizations (e.g. supply schedule)

6 Public website 7 8 9 10 1 Extranet 2 3 4222 5 6 7 8 9 Internal data and knowledge 20 1 Figure 19.1 Information ﬂows in an organization 2 3 4 as organizations become more transparent. from the Department of Transport, Local 5 These easy communication lines create Government and the Regions). 6 opportunities for sensitive information to People using newsgroups and discussion 7 ‘escape’ and this can be the cause of varying lists at work and at home, frequently com- 8 degrees of embarrassment and corporate ment about their companies to people they 9 compromise. do not know and who may live on the other 30222 Our organizations are becoming much side of the world or a street away. People 1 more transparent. Companies publishing (and technologies) can use, amend, annotate 2 press releases for the convenience of the press and juxtapose this information, the internet 3 and public automatically make them available can act as an agent of change to alter, spread 4 to competitors. This is just one example, there and misapply corporate messages and inform- 5 are hundreds including comparisons of price, ation(Figure 19.2).4 6 product and service that can be made by com- 7 petitors as well as consumers, employees and 8 many other publics. Protecting organizations with 9 Information that ‘leaks’ out of organiza- employee awareness campaigns 40 tions is called porosity. Examples of porosity 1 can be found in emails leaked to the press (the We can learn lessons from the US govern- 2 Martin Sixsmith/Stephen Byers debacle in the ment’s approach to crisis and its analysis of 3222 United Kingdom included emails being leaked the threat.

Agency Transparent communication to Web the world site Transparent Agency Agency communication to information partners Porous Agency Extranet information Agency Porous information Intranet Agency Porous information Porous information

Figure 19.2 The ﬂow of information to the outside world making organizations more transparent and porous, offering greater opportunities for internet agency to take effect

It made it clear that technology in the form pay, or frustration with colleagues) or avail- of security systems and firewalls is not ability of work equipment. A typical response enough. It identified that organizational may be from frustration caused by dated com- policies, practice and processes as well as puter equipment at work (especially when a technology are important. It noted that, in an home computer will often be more powerful environment where most employees are trust- and running the latest software while a work worthy, there is a lesser threat but pointed to computer and its software can be compara- the need for policies, practices and processes tively dated). Frustration will lead employees to be implemented and adhered to, to reduce to ‘short circuit the system’ by, for example, the threat. working from home or by adding pirate soft- This is where the PR practitioner has a role ware to a work station leading to security to play. Employees who are aware of the lapses. It is then a short step to sending inse- value of reputation (which can be worth as cure information externally. A spiral of com- much as, if not much more than, the capital promise results and opens the gateway to value of buildings, machines and many intel- more dangerous outcomes until this issue lectual properties) will be much more aware becomes a crisis. of the need to mind corporate reputation, if An actual case in August 2001 occurred for no other reason than self-interest. In addi- when Cisco implemented major cost cutting tion, employees who are aware of the ethical throughout the organization. An employee, mores of an organization will be much less tol- unhappy and frustrated by a cutback in the erant of compromise by colleagues. budget for supplying mineral water (kept There is a greater threat from disaffection. refrigerated and available to everyone), This can be because of slight (imagined or created a website5 with a number of spoof real), unhappiness (over working conditions, posters (see example in Figure 19.3). In a very

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 5 6 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 Figure 19.3 1 Cisco found itself subject to very public satire 2 after displaying posters asking employees to drink less water as a cost saving exercise – a more 3 than usual example of corporate porosity 4 5 6 short time this site was quoted across the (it cited the US Department of Defense, with 7 internet. It was light hearted but nevertheless over 200 gigabytes of publicly accessible 8 embarrassing for Cisco, if amusing to the rest data) much can be inferred and conclusions 9 of the world. drawn of an unhelpful nature by employees 30222 In examining such motives, an organization and external activists. There are many advan- 1 will heed the report of the joint findings by tages for organizations when making up-to- 2 the US Computer Sciences and Telecommuni- date information available on websites but 3 cations Board, the National Research Council equally there is the opportunity for it to pro- 4 and the National Academies in the United vide raw material for close external analysis 5 States.6 This group identified that there was and conclusions to be drawn. 6 little distinction between the vulnerabilities of Once again, it is the senior PR manager 7 classified and unclassified data and systems. who has to balance the needs of website users 8 They found they were both subject to motiva- and the advantages of transparency against the 9 tions as diverse as coercion to personal con- occasion of unwarranted or misleading conclu- 40 viction prompting unhelpful or dangerous sions being drawn to damage an organization. 1 responses by malcontent employees. As many websites are large, it is usual to dis- 2 In addition, the committee identified that cover out-of-date information juxtaposed with 3222 as organizations became more transparent apparently conflicting modern website con-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors tent. Such lack of website maintenance disci- campaign was undermined and Microsoft’s pline can cause some serious problems for reputation was tainted when it was discovered organizations. The internet is responsible for that some of these letters had been received only a small proportion of corporate crises. from people who were dead. For most Microsoft users, this story is a ‘little local difﬁ- culty’ in the United States. While the story Management caused crisis broke in the Los Angeles Times, the reach and speed of the internet meant that the story was According to the Institute for Crisis Manage- out across the world in minutes (Figure 19.4). ment,7 management decisions/indecision still Knowing where crisis is most likely to emerge rank highest as the cause for corporate crisis. is very helpful for crisis management. Human error, mechanical problems and acts of god, are, in descending order, the remain- Planning to handle sudden crisis ing principal causes. What the internet does, is offer fast and The four key attributes public relations brings extensive reach of information about such dis- to crisis management are: asters. It is on the internet that the consequences of management decisions/indecision 1 The practitioner who is able to bring to are most evident in creating issues. In 2001, crisis planning a dispassionate, broad and Microsoft was involved in a direct mail lobby- considered balance to potential hazards. ing campaign. Its managers decided to aid Being able to understand the danger and the distribution of letters to be sent to gov- not be sucked into a panicked response is ernment representatives ostensibly from the the most important quality of the pro- public pleading the company’s cause. The fessional practitioner. The most effective

Figure 19.4 The Microsoft lobbying misadventure is available to a global public because of the reach of the internet. The internet aids the transparency of the Los Angeles Times

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 practice comes from taking the broad calm and as dispassionate as possible. The 2 view and planning. The process of plan- following provides some guidance as to how 3 ning will expose vulnerabilities and responses can be in place for increasingly 4 reduce risk. serious events. Events may require a pick and 5 2 It is cause for little surprise to find other- mix approach to the use of these crisis tools 6 wise competent managers are unskilled in but they form a process for escalating 7 communication. A PR practitioner will response, as follows. 8 always respond by reviewing the com- 1 Sudden and unexpected events which 9 munication needs of a wide range of dif- can be handled by a person on the spot with 10 ferent publics. They will weigh up the direct responsibility and training or, often, 1 consequential effect of different forms of good common sense. This is the most 2 communiqué on different and tertiary common form of crisis. This might be to put 3 publics. Most managers have a much nar- out a small fire, or set off an alarm. The prac- 4222 rower view. Thinking about consequences titioner will want to prepare for responding to 5 for employees, shareholders, commun- such an effort by developing an internal brief- 6 ities, suppliers, the media and other rele- ing plan and an external communication 7 vant publics is a key asset. routine for delivering information to relevant 8 3 The third and most valuable asset is a publics. This will mean that the practitioner 9 practitioner who is prepared and who has will have a list (database) of publics such as 20 considered a wide range of scenarios and employees, departmental or section heads, 1 necessary responses. other and external stakeholders and the 2 4 The fourth asset is the practitioner who media. While traditional means for communi- 3 can, in peacetime, inspire people to think cation are to be included (letter, memo, tele- 4 the unthinkable, plan, prepare and prac- phone, press release), it is important to have 5 tise. It may never happen but developing email addresses available too. It may be 6 teams to manage crises makes them useful to have a webpage (and draft content) 7 better managers for day to day work and ready to add to the relevant intranet or web- 8 makes them aware that even small issues site which can be quickly populated and 9 can escalate, and so they see why they posted to the server. The key issue here is the 30222 have to manage them ever more effec- modernity of the lists and an ability to 1 tively. manage such a crisis from a different location. 2 In addition, the practitioner will need to be 3 wary of turning a local incident into a global 4 Planning responses issue. The circulation of information needs to 5 be circumspect. The BBC will leap at a fire 6 Planning responses for crises will fall into per- story and a small incident can be akin to a 7 haps four levels of preparation and response. national disaster on a slow news day! Be wary 8 The key to managing crises is to construct of using email. It is all too easy to ‘forward’ an 9 plans in such a way that they can be managed email to hundreds of friends. An employee 40 on an escalating scale. From management using email can make his ‘exciting day at the 1 of a potential dangerous but contained event office’ sound like Armageddon! 2 to a full-scale disaster, the plan will need to 2 An event that requires the co-operative 3222 change. In a real crisis, the first rule is to be effort of more people and which may require

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors bringing people in to work from home is the regular and reassuring (even when the crisis is next escalation step in planning responses. worrying), the practitioner and the crisis team More people are involved and so more will have greater freedom for action (and information and even wider interpretation of more productive time) if the briefing process events is normal. In addition, there will be is effective. In this circumstance, the plan calls wider spread about news of the incident. for both offsite backup of the organization’s The practitioner may be away (even PR intranet and website (a mirror site) and will people take holidays) and even the most require pages prepared that can be uploaded appropriate managers may be too far away or quickly. A major incident may mean that the incommunicado. The practitioner will want to organization’s web server is affected and so have in place all the arrangements identified cannot be relied on. For the same reasons, above but will additionally be responsible for there need to be alternative and offsite tele- alerting more colleagues and external agen- phones ready to come into play. Personal cell- cies. Once again, the most appropriate list of phone numbers are not a very good idea. contacts will need to be available. The logis- They quickly become inundated with incom- tics will now be more cumbersome and the ing calls. Making outgoing calls becomes a temptation to use email even more com- nightmare. Work with a nearby call centre to pelling. The need for the plan to work even see if their facility can cope with sudden and when key people are absent is now a signifi- significant pressure. cant consideration. In an event such as this, there will be a call 3 An event that requires a team of col- for a lot of supporting information by many leagues and even outside agencies or contrac- publics and the media. It should be remem- tors raises the incident profile considerably. bered that corporate websites are now the An attendant fire engine or horde of ‘inspec- first port of call for journalists. Background tors’ create excitement, interest, and the inter- information and key contacts need to be very pretation of events will have an aura of gossip visible from the front page of the website but forming round knowledge, debate and con- a new and direct emergency page needs to be jecture. There will be the additional need to posted quickly. Pre-prepared pages that can have people in place who can act as one or be populated and posted to the site quickly more (trained) spokespersons. This person will point to other of the organization’s (often (people) should not be the responsible PR already existing) pages. Contact information, practitioner (he/she will have far too much to maps and personnel profiles plus added do). The CEO should not be in the front line information such as local services (hospitals, either. Senior managers should be protected police, and the fire brigade PR departments from media calls because the business will may be included). It may be that the organ- continue to need management, and press calls ization’s emergency site will point to govern- are an unnecessary distraction. The key to ment departments and specific relevant being effective under such circumstance is to official web pages. But the pages posted in ensure managers are briefed with facts (and such events need to be flexibly constructed. only facts) and are up to date. There is no point in publicizing the fire Crisis is a distraction and even in competent brigade when your crisis is the demise of a key hands some will want to ‘meddle’. If the brief- employee in a far off land. The new additions ing plan is well conceived and updates are to the organization’s site will offer contact

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 information (with alternatives). One form of Information and planning available to all in 2 contact is not enough. Phone is fine, email is normal times can become inaccessible in an 3 essential, instant messenger for a selected few emergency. Information availability during a 4 and even web cam broadcast can all be a plus. crisis needs to be considered in the planning 5 This is the hardest time to handle email process. This size of event may well need pre- 6 requests for information and, at the same time pared positions with outside stakeholders. 7 the most critical time. Email turnround has to Hospitals, police, fire, ambulance, call centres, 8 be swift. There is nothing more impressive stress councillors, community leaders can be 9 than an organization with a major incident on in a position of readiness from prior consulta- 10 its hands that is providing good information tion, but there are some other refinements 1 and contacts via the web page and apparently that the internet will offer the prepared. 2 very in-control. If everything is dead . . . 4 Major disaster happens infrequently. It is 3 everyone knows this is not an incident – it’s a hard enough keeping internal lists of em- 4222 disaster. On one hand, the organization’s ployees. To be as well informed for a whole 5 reputation sours and, on the other, it is driven external community is far too difficult. Using 6 into the realm of management incompetence. the internet, it is possible to make information Why email? For a big incident, and because 7 available that can be a combined introduc- news spreads very fast through the web, rela- 8 tion, call for help, and a list of things that you 9 tives, journalists and friends will want to be need done. This can be delivered by email or 20 kept informed from around the world. With (and much better) made available (when and 1 telephone facilities too stretched (or signifi- if the time comes) in a website that has a spe- 2 cantly disrupted) email is a very useful com- cific and hitherto unavailable address. In this 3 munication tool and will relieve pressure on way detailed information, links to related 4 other, more critical communication resources. data, instruction, organizations and people 5 It is useful to have a number of people 6 who can manage email. The use of call centres can be posted to the site and will require little 7 for telephone enquiries can also be used as a maintenance for days after the event, to free 8 template for a significant email response key people for more urgent work. 9 resource. In the plan (and on your website), it Because crisis hits unexpectedly, the 30222 is possible to offer different email addresses process of keeping plans and the necessary 1 for different needs. Some for the press, some facility both up to date and flexibly available 2 for shareholders and another for employee or to a number of key individuals is very import- 3 family enquiries. In an email centre and in a ant. Consideration should be given to main- 4 call centre, one of the most helpful assets is an taining a layperson’s guide. One of the best 5 ability to construct web pages on the fly. ways of doing this is on a CD disk. Updated 6 When a question keeps coming up, it is quite each quarter and distributed both on and off 7 efficient to offer a web page that offers site (even globally), it can guide even the least 8 information for the centre’s staff and for the well trained to handle a crisis professionally. 9 caller/email enquiry. Websites and intranets In addition, it is relatively simple to keep CDs 40 can give information to staff responding to safe and secure and confidential. 1 enquiries that they may not know about. It is The biggest incidents can overwhelm all 2 a quick and effective form of briefing for these preparations; or may mean that not 3222 many people. all the planned responses can be (or need to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors be) deployed. In addition, the consequences management planners re-inventing systems to of events may call for prolonged responses. manage its crisis. It is important to translate The case where employees have to be paper-based crisis management with digital stood down or suppliers have to be turned tools. away can become a big problem. Planning for In a big crisis, there will be those who will such events will require the deployment of a try to publish everything and those who will lot of information. attempt to hush everything up. In addition, The big issues are not from the most highly there is a natural desire to express hoped for protected information. This should already outcomes rather than facts. There has to be be backed up and supported offsite. The intel- ﬁne judgement as to when ‘going public’ will lectual properties and corporate information be the lesser of two evils or even a real advan- will already be well guarded against disaster tage. There is no case for offering anything (unless this is the crisis you face). The real but accurate information. The consequential problem will be the simple daily routine. loss of conﬁdence can be traumatic. Employee addresses that have been destroyed One of the big problems organizations face or (worse) revealed to the population at large under these kinds of pressures is the combin- is not an untypical event. A simple headcount ation of creating helpful facilities for the of employees can become a living hell when a media (and some other onlookers) and, at the worried family is uncertain about the safety same time the means for reducing trespass. of an employee. Inadequate response at such Press centres are helpful and should be a place times can be a reputational disaster as well as where all statements are made. It avoids con- a human (if temporary) tragedy. When such fusion and ensures that the media is fre- issues have to be managed, there will need to quently in one place. It has to be reasonably be a contingency plan. Using the media to aid comfortable, must have many telephones recovery may become an important part of and there is a need for a room to hold press the practitioner’s job. conferences separate from where the media Other information, often contact informa- foregather. In a real crisis, photographers, and tion, order information and many departmen- not a few journalists, can be very rough. Some tal plans can be held on intranets or PCs beefy security is often needed. where it can become inaccessible. Of course, There is also a state of mind that allows organizations have backup facilities, but in a some managers to think in terms of turning a real disaster, it becomes evident where organ- disaster into an advantage. This can be a real izational loopholes leave organizations wrong boon. A TV crew in a school temporarily used footed. for this work can be a story about a company The UK government, faced with a foot-and- striving to overcome disaster to the comfort of mouth disease disaster, was subject to high employees, community, suppliers and share- levels of criticism for not deploying resources holders. as proposed in the public inquiry to the 1967 epidemic. In that case, the crisis plan seemed to be rather dusty. When issues escalate into crisis There is a further problem which is a mis- match of paper-based and information- In every organization there are incipient disas- era data management which can leave crisis ters waiting to happen. The practical and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 pragmatic practitioner will plan for such pressure groups, activists or the simply mali- 2 eventualities. A crisis management team will cious can instigate all manner of enquiry. A 3 be advised to prepare against events getting simple phone call or email can start a very 4 out of hand. In every sphere of organizational dangerous hare running. This will involve 5 management, there will be a weak spot. A more than a line manager and, while it may 6 leaking tank, unresolved claim, incomplete not overly disturb the business of the organ- 7 accident form, unexpected litigation, whistle ization, may require sensitive handling and a 8 blower, government inquiry, new legislation, reporting line to alert the PR practitioner. For 9 etc. the most part, such events can be handled by 10 The process for planning against such issues straight dealing with the relevant authority. 1 gaining crisis proportions and, should they A corporation with a good relationship within 2 escalate, minimizing the damage, is a practical the local community will, mostly, be un- 3 management one. The escalation path can affected save for the cost of managing such 4222 follow a route from daily event to major crisis, activity. A regular ﬂow of such incidents will 5 passing issues management on the way. be a different matter and will require both 6 1 At their least dangerous issues are mostly internal relationship management develop- 7 dealt with as part of everyday management. ments and closer, more focused, dealing with 8 Disgruntled employees, customers, suppliers, the affected authorities. Enhanced trans- 9 competitors, government regulators, pressure parency is called for. 20 groups, activists or local communities can This added transparency can use many 1 have issues as simple as quality control con- different communication channels. It may be 2 cerns, minor accidents, inadvertent exposure on an intranet or via a website and may be 3 of confidential information, and these are there just to be reactive such that an enquirer 4 part of day-to-day operation. In the internet- can ﬁnd the information if interested. It will 5 6 mediated era it is quite simple for an em- probably be the case that proactively promot- 7 ployee’s ‘bad day’ to become an evening ing such information will not be part of the 8 internet chat room discussion. Such informa- chosen plan at this stage. Some companies 9 tion will be almost innocently shared with have such pre-emptive strategies evident to 30222 complete strangers a few miles away and the world. The extent to which a supermarket 1 across the world. The practitioner will be has to be prepared is freely available on the 2 aware of the implications and will be well Tesco website (see Figure 19.5). 3 advised to ensure effective employee training There are alternative strategies where 4 about their responsibilities and the conse- organizations assist employees to resist the 5 quences of such actions implicit in such work of people who would disrupt the organ- 6 exchanges. For the most part these alarums ization. The ‘Miami University Resources for 7 and excursions are dealt with by line man- Dealing with Hate Crimes and Bias-Motivated 8 agers and are little cause for concern when Incidents’8 makes a clear statement as to what 9 dealt with at the time. it will do in cases of threats to students and 40 2 Because it is very simple to contact an personnel and also offers help and advice. 1 array of authorities and interest groups, an In addition the practitioner will need to 2 employee, customers, suppliers, competitors, possess lists of relevant statutory, industry 3222 government regulator, local communities, association, academic, government and issues

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Figure 19.5 Tesco has statements about many of the issues the company manages on its website organizations ready to aid communications as pation. As the number of people involved appropriate. It is important that these lists grows, so the organization moves closer to include information about relevant websites crisis. (and the appropriate webpage), email 3 Issues really escalate when the threat addresses and, if available, instant messaging looks as though it will become evident in and online conferencing capability. Part of the different communication channels. A threat to practitioner’s job is networking with such a mediated channel, such as a newspaper, organizations for normal exchanges between government department, or established insti- an organization and its publics and in readi- tution, has the beneﬁt that such organizations ness for issues management at this level. Such tend to seek more information, the truth or at contacts should not be managed in a haphaz- least a good story. Good issues management ard way but as part of a structured approach to and effective press relations will keep an issue management of issue. Good record keeping is in proportion. When the channel for express- essential and a schedule of contacts main- ing an opinion or even fact has moved from tained. internal reporting, conjecture or gossip to a The employee that offers confidential journalist, discussion list or usenet is a change information in order to hold the company of communication channel and is serious. The accountable or to gain unfair beneﬁt or even issue is now a crisis. The easy way to spot a as blackmail will require a wider range of crisis is that point in time when information expertise on the part of the practitioner. This jumps channels. may be available in-house, with a third party The internal (and in many cases associated (such as ACAS) and may require a response external) people involved in this crisis are that is more robust with police or legal partici- often very vulnerable. They will need help

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 (as will their families in many cases). They will A prominent (if risky) example of going 2 need somewhere to go away from the glare of public when innocent as the means for man- 3 publicity. They will need time to think and aging a crisis was used by Neil and Christine 4 reflect as well as to plan. These facilities need Hamilton in the United Kingdom in 2001. The 5 to be considered well in advance. The media whole story is available at the BBC (http:// 6 will look very hard and are good at finding news.bbc.co.uk/hi/english/uk/newsid_ 7 ‘secret locations’. 1513000/1513921.stm) and offers a case 8 Today there is a more dangerous option study of how such a strategy can work. Being 9 and it is much easier than talking to a journal- able to withstand the pressures, especially 10 ist. For example, an employee considering from the media, in this scenario will have to 1 publishing information in a usenet newsgroup be thought through very carefully before 2 or email discussion list or who may consider embarking on such a process. 3 publication in a personal website is very easy. 4 Issues as they escalate to major crisis pro- 4222 A threat of a person (external or employee) portions require the full use of all the crisis 5 opening up new channels to express their management capability mentioned above. 6 angst may require counselling and/or external Much of the media and especially photogra- (often legal) help. At this stage the practi- 7 phers will be hard to handle. They will always tioner will need to have available a range of 8 be looking for an angle that juxtaposes people 9 internal and external communication pro- with a ‘slant’ on the story. Panorama, the UK 20 cesses. The contacts identified above are now investigative programme broadcast by the 1 more important and may be needed as part of BBC made a habit of signing off stories with a 2 the issues management plan. Added trans- journalist posing in front of government 3 parency by way of factual information avail- ministerial buildings to give otherwise flaky 4 able to employees and other stakeholders accusations the apparent authority of the 5 becomes significant. 6 Once again, having the means for using government. 7 web-based information can be very helpful Crisis management processes at this stage 8 for both a growing number of internal and will really be worrying all the organization’s 9 external managers and advisers and also to be stakeholders. They will seek information and 30222 made available to the public at large. Some of will be happy to accept it from anywhere. 1 this information can be promoted to relevant Silence can be an option but not often. 2 publics as part of the plan. This does not mean that the media, web or 3 The organization’s virtual press office (VPO) email communication should be the only 4 is now a very important resource. There needs options for communication. Some pretty old 5 to be a direct link from the home page (and communication techniques are very powerful. 6 many other pages) into the VPO. In addition, A letter (preferably personally signed), private 7 where the organization has created some meetings of interested groups and the tele- 8 form of barrier between unregistered journal- phone are all significant forms for communi- 9 ists and the favoured (and interested) few, cation in a real crisis. 40 this needs to be removed. In a crisis, a whole At this stage, when survival really is on 1 new range of journalists will take an interest in the line, there will be no other activity in 2 the organization and will need very fast the organization which is more important. 3222 access. Taking resources from all departments in the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors organization is something that has to be done • Company Ethics: http://www.company when needed. Demarcations and traditional ethics.com lines of communication may have to be short • Urban Legend: http://www.snopes2.com cut to be effective. Planning for issues-led crisis is very rewarding. It helps the practitioner’s organization What crisis to plan for understand its vulnerabilities on a day-to-day basis. It is able to examine quality issues from Every organization will want to plan for differ- a risk and reward perspective. It enables the ent crises but it is helpful to have a starting organization to examine corporate social point. The list below is published on the Issues responsibility policies from the perspective of and Crisis Management pages of the ICM the risks involved from disgruntled employ- website http://www.crisisexperts.com. ees, employees’ mistakes and poor decision making, customers with a complaint, upset Adverse government actions suppliers, competitors, government regulators Computer tampering and inspectors, pressure groups, activists and Anonymous accusations local communities. Damaging rumours Simple scenario brainstorming round these Competitive misinformation publics will help the organization understand Discrimination accusations such organizations. In preparation for such Conﬁdential information disclosed activities, there are some valuable resources to Equipment, product or service sabotage be researched such as: Misuse of chemical products Industrial espionage • Institute For Crisis, Disaster and Risk Disgruntled employee threats Management: http://www.seas.gwu.edu/ Investigative reporter contact ~icdm Employee death or serious injury • One World: http://www.oneworld.org and Merger/acquisition rumour http://www.oneworld.org/ni/index4.html Employee involved in a scandal • Urban75: http://www.urban75.com and Labour problems http://www.urban75.com/Action/squat. Licensing disputes with local ofﬁcials html and http://www.urban75.com/Links/ Lawsuit likely to be publicized index.html Extortion threat • Managing Reputation in Cyberspace: Security leak or problem http://www.hawkesmere.co.uk/auto/titles/ False accusations 158.html Severe weather impact on business • Risk Issues and Crisis Management: http:// Incorrect installation of equipment www.ipr.org.uk/Products/pr_in_prac/risk Sexual harassment allegation issues.htm Legal injunction • Steven Van Hook’s Issues management Special interest group attack pages at About PR: http://publicrelations. Grassroots demonstrations about.com/cs/crisishelp/index.htm and Strike, work stoppage http://publicrelations.about.com/cs/crisis Illegal actions by an employee management/index.htm Terrorism threat or action

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Arrest or legal action of an employee In another case, a company used competi- 2 Illegal or unethical behaviour of an tor comparisons naming specific brands in 3 employee its web pages to seduce search engines to 4 Major equipment malfunction bring competitor enquiries to its site. 5 Union organizing actions 6 Nearby neighbour, business protest 7 Whistle blower threat or actions Front organizations 8 9 Some companies have used front organiza- Some online crises 10 tions to attack brands: they are often 1 noticed because they attack only one type The following cases are extracts from of product when others exist in the market 2 Managing Your Reputation in Cyberspace9 and 3 niche. Sharon Beder who wrote Global Spin offer the practitioner a range of scenarios to mentions a corporate front group called 4222 ponder and imagine how well prepared their 5 ‘Mothers Against Pollution’, which cam- organization may be to manage such paigned against plastic milk bottles. It was 6 circumstances. 7 discovered that this was initiated by the 8 owner of a company which produced card- 9 A pornographer’s attack board cartons. 20 What do Disney, Barbie, CNN, Honda and 1 Counterfeit marketers 2 Mercedes have in common? They topped the list of the ten brands most commonly 3 ‘Children’s toys are not the only items 4 associated with pornography on the internet, according to a study by Cyveillance™,10 being counterfeited and sold over the 5 Internet’ said Brandy Thomas, CEO and 6 who specialize in online brand protection. The other five brand names most often chairman of Cyveillance. ‘The Internet has 7 become a hotbed for the sale of counterfeit 8 found in pornographic websites were Levi’s, ESPN, NBA, Chevy and Nintendo, luxury items that you might typically find 9 on any street corner in New York City – 30222 respectively. These popular brand names appeared in hidden or visible text on the watches, pens, sunglasses, leather goods, 1 you name it. Like in the streets of New 2 sites identified and in metatags in 25 per cent of the sites suspected of containing York, prices that seem too good to be true, 3 usually are.’ 4 pornography – presumably without the 5 brand owners’ knowledge. 6 Politician on the take 7 Meta attack 8 By combining the databases that track the 9 In the United Kingdom a company discov- voting and investing information with a 40 ered a sudden drop in visits to its site. On network that distributes the information, in 1 investigation it found a competitor had this case a website, it becomes possible to 2 used its name in the metatag, thus steering provide a citizen’s guide to who owns who 3222 search engines towards the competition. in Washington.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Mojo Wire,11 is the website which connects The information about employees includes: the databases into a ‘Taking Stock in home addresses; street maps identifying Congress’ section where citizens can follow the locations of the addresses; home tele- the stock transactions and voting records of phone numbers; fax numbers; social secu- ‘83 members of Congress who purchased rity numbers; photographs of automobiles or sold stocks near the time of Congres- and their licence plates which appear to sional votes or other government actions have been taken in public; and photo- relevant to the stocks’ value’. graphs of people which appear to have been taken in public. Sheehan declares There have been some interesting revela- that he obtained this information lawfully, tions. from such public information sources as the Washington Secretary of State and Senator Alfonse D’Amato (R-NY) bought up other internet sites. Sheehan’s website con- public utilities stock just two days before tains no explicit encouragement for readers President Bush signed the National Energy to engage in any speciﬁc conduct, or to use Conservation Act, which deregulated energy the information about employees or attor- transmissions, offering growth opportunities neys in any speciﬁc way. for many utilities.

Newt Gingrich (R-GA) helped kill amend- Iffy analysts commenting on your ments to cut funding for the space station share price? programme just three weeks after buying stock in Boeing, which was subsequently There are a host of scams. Professional named the prime contractor for the station. internet promoters, some with elaborate briefing sites and any number of ways to avoid regulators. Protect your employees Masquerading as ‘Analysts’ they offer a Since February 1997, Bill Sheehan has range of services. And look very appealing. operated a website which contains four The content of www.financialWeb.com/ general types of content: (1) Sheehan’s stockdetective is packed with scams and grievances against government officials and promotion devices, names people and private parties, most of them credit report- companies and shows website URLs. It has ing agencies and debt collection services; a marvellous page of alleged scams called (2) strongly worded expressions of opinion ‘Stinky Stocks’. (e.g. referring to a corporation as ‘crimin- ally insane’, etc.); (3) allegations about corporations and persons which were claimed Using your site for scam? to be defamatory; (4) information about employees of companies. Turner Phillips found a novel way to make it appear as though it was a member of the After Sheehan filed his lawsuit, he added to Investment Dealers Association of Canada, the website information regarding defen- three Canadian stock exchanges and the dants’ outside counsel. NASDAQ Stock Market in the United States.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 It copied all the information on the website New human rights acts: do they 2 of an unnamed Canadian investment change the threat? 3 dealer that is a member of these self-regu- 4 latory agencies and superimposed the In the Raython case, the company asserts 5 name Turner Phillips onto that firm’s data, that employees leaked proprietary techni- 6 then posted the material to its own site. cal and financial data via the internet. 7 Turner Phillips contacted prospective vic- While an employment contract may bar 8 tims over the telephone and then referred employees from discussing company 9 them to the website for more information secrets in public (and confidentiality law is 10 on the firm. Although Turner Phillips said it more widely applied in Europe), the First 1 had its head office in Vancouver, all it had Amendment may give employees a right to 2 in the city was a mail drop and a telephone do so. Sobel says: ‘The Supreme Court has 3 answering service. Calls placed to the said the First Amendment protects the right 4222 Vancouver number were forwarded to a to communicate anonymously, so I do see a 5 location in Washington State and then from First Amendment problem with these 6 there to another location. Mail was for- cases.’ A company may be protected in the 7 warded to somewhere in Ontario. United Kingdom but not in the United 8 States and as a result the story will be avail- 9 able everywhere. 20 Employee share scam 1 2 A phoney Bloomberg tip, part of a disguised Conflicting national laws affecting 3 webpage hoax about a purported takeover your business? 4 of PairGain Technologies, prompted online 5 speculators into a feeding frenzy and sent The prominent US Jewish group, the Simon 6 shares of the company’s stock soaring 34 Wiesenthal Centre, asked Bertelsmann to 7 per cent on 7 April 1999. A Yahoo chat make sure that books like Hitler’s Mein 8 room visitor publicized the page’s existence. Kampf are not sold in Germany through 9 A lot of people visited it and decided to buy barnesandnoble.com, Bertelsmann’s joint 30222 the stock. venture with US bookseller Barnes and 1 Noble. The distribution of such books is 2 The whole scam was invented by Gary Dale illegal in Germany, but allowed in the 3 Hoke of Raleigh, N.C. Hoke, a PairGain United States. 4 employee, who owned stock in the com- 5 pany, which makes high-speed internet con- Of course banning books in the United 6 nection products. The story falsely claimed States is illegal and so Bertelsmann is taking 7 that an Israeli company was acquiring the lead in getting multinational corpora- 8 PairGain for $1.35 billion in cash. Shortly tions to help unify national regulations 9 after the story was posted, PairGain’s stock relating to global electronic commerce. 40 surged from $8.50 per share to $11.25. The 1 stock later dropped after the hoax was 2 exposed. 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Someone got your copyright: you got one of the pivotal events in internet someone else’s? activism. It was the day when a campaign was started to place McDonald’s at the Copyright is the right to copy in any form centre of anti-corporatism by a number of (reproduce, perform, adapt, publish, pub- activists. lish translations, convert to a different format, communicate by telecommunica- It gave rise to the longest civil court case in tion, rent, exhibit in public, etc.), in whole history between David Morris and Helen or in part, an original creative work. Orig- Steel and McDonald’s. inal creative works include literary, dram- The appearance of a website created by the atic, musical and artistic works, and com- activists came in February 1996 when puter programmes. A few things, which are Morris and Steel launched the McSpotlight not protected by copyright, are: names, internet site from a laptop connected to titles, slogans, short phrases, factual in- the internet via a mobile phone outside a formation, plots, characters, and methods McDonald’s store in central London (Figure or techniques. Some of these, however, can 19.6). The website was accessed more than be protected in other ways. For example, a million times in its ﬁrst month. It was names or slogans can be trademarked and headline news across the world. in some states like the US ‘registered’ ®. By any standards, the McSpotlight site is Usually copyright is owned by the creator big and has an amazing amount of content. of the work. If, however, you create the A large part of the content is critical of work as part of employment, the copyright McDonald’s and some is allegedly libellous. belongs to the company unless there is an agreement specifying otherwise. In any On 19 June 1997, after a case said to have case, in the UK copyright applies auto- cost the company over £10 million and a matically and does not have to be explicitly £60,000 settlement against Morris and registered. Steel, the website was accessed 2.2 million times. Passing off as you? Activists Global Asset Management, a London based investment company, created four websites A number of activists believe: ‘there is a and found that the GAM name was being dynamic of struggles between competing used by a company based in Ghana to the groups to establish their perspective as extent that search engines would ﬁnd the absolute truth. For this reason it is import- Ghanaian company before the real GAM ant to look at the actions and motivations sites. of actors who seek to halt the progress of environmental groups.’

A hate site? There are a number of well known books which deal with activism including: Global It was a chill morning in London on 16 Spin by Sharon Beder, Toxic Sludge Is Good October 1986 and a day that was to create For You by John Stauber and Sheldon

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 4 5 6 7 8 9 10 1 2 3 4222 5 6 7 8 Figure 19.6 9 McDonald’s 20 1 2 Rampton and Green Backlash by Andrew since 1992 (old Chase). Since the Chase– 3 Rowell. Chemical merger in 1996, I have seen this 4 bank go down hill. The bank became trashy 5 They are up-to-date, says Simon May, and the Chase name which at one time I 6 Shell’s internet manager. He is reported as was proud to work for, means nothing. 7 saying he believes that activism on the 8 internet should not be viewed as a The Chemical senior managers took the 9 ‘menace’, but rather as a ‘challenge’ for Chase name and ran it through the mud: 30222 corporates. Companies should adopt the http://www.chasebanksucks.com 1 internet for the same reasons and utilize 2 some of the same strategies as activists, but 3 with a more planned and professional Unfounded accusation 4 approach. Furthermore, full advantage 5 should be taken of the potential of the In March 1997, a well-known US fashion 6 internet to monitor grassroots opinion and designer, Tommy Hilﬁger, was accused of 7 activities (Lubbers 1998:net). making racist remarks during an appear- 8 ance on The Oprah Winfrey Show. Tommy 9 Unhappy employee Hilﬁger denies ever making such remarks. 40 This is not hard to do. Both he and spokes- 1 Name: Witheld people for Ms Winfrey maintain he has 2 Email: n.a. neither appeared nor been asked to appear 3222 Comments: I have been a Chase employee on The Oprah Winfrey Show. This did not

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors prevent a mass of comment in dozens of • Consider the organization’s strengths, newsgroups pointing at Tommy Hilfiger weaknesses, opportunities and threats. and branding him as racist. • Develop a series of realistic scenarios. • Begin to develop lists of people and con- Even the most exhaustive PR campaigns tacts both internal and external who are cannot easily refute rogue information important to you and your organization. which is allowed to spread too long. In • Develop plans in a number of scenarios spite of well-publicized responses the from the least threatening to the most newsgroup talk online still disparages threatening – an escalation plan. Tommy Hilfiger’s supposed remarks to this • Prepare key materials, messages, and the day. means for communication and include electronic media. Not included in internet exchanges? • Select and train the crisis team. • Involve the team in risk assessment. In another study by IRS, during June 1999, • Simulate. in only three discussion groups (support. • Ensure you have the means to manage asthma, uk.local.surrey and games. when key people are away and if the miniatures) there were 3,500 comments on operation is not possible on site. quality pertaining to UK supermarkets. The • Find a way of ensuring that for both issue subject of quality associated with named and crisis management there is a good supermarkets appeared in 36 UK news- management reason (preferably other groups. By extrapolation, it might be said than crisis) to keep your information and that there were 30,000 public comments capability up to date. available for the whole world to see about • For each of your issues use a step by step the quality of UK supermarkets. approach on how to handle a crisis – see In addition, there was an audience who did the crisis management plan (Figure 19.7). not actively comment in numbers, maybe vying with the Sun newspaper in total audience size. By any measure this represents a Conclusions sizeable number of people prepared to make a comment and elect to spend time Issues have to be managed. The practitioner reading such comments. A sample of the role is pivotal and there is a significant cross postings showed 63 per cent of commenta- over from the public relations role to corpor- tors recommended a particular retailer and ate management. Being prepared, planning 37 per cent who were critical. Notably, and training and then teambuilding with dis- some retailers came out well ahead of the passionate and calm people who can work others with little criticism and much praise. under pressure in difficult circumstances goes without saying. It is the skills of the PR profes- The steps of the plan sional that are most significant, which include the ability to assess the impact of events, • For each of the above potential threats it actions and statements on many publics. This is worth undertaking a risk assessment. is a critical skill.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 Issue 4 5 6 7 8 Is this No 9 important? Take 10 no action 1 2 Yes 3 4222 Agreed Must I act Keep Agreed 5 No process now? under process 6 review 7 8 No Yes 9 Agreed process 20 No 1 Internet Should I and Yes respond on No Should 2 respond off-line the internet? Yes 3 off-line Agreed process 4 5 Yes Yes 6 7 Agreed Should I Who Agreed No 8 process respond should process 9 myself? respond? 30222 1 Yes 2 3 Contact web 4 Offline master/add Add content Respond via Agreed 5 response content to to my site another site process their site 6 7 8 9 Agreed Agreed Agreed 40 process process process 1 2 Figure 19.7 Crisis management plan 3222

1 Grunig, J. E. (1982), ‘The message–attitude– 6 Summary of Discussions at a Planning Meeting behavior relationship: communication behavior On: Cyber-security and the Insider Threat to of organisations’, Communication Research, 9, Classified Information, chaired by Jones, A. K., 163–200. and Quarles, L. R., Washington, DC, November 2 Grunig, J. E. and Hunt, T. (1984), Managing Public 2000. Published by the Computer Science And Relations, New York: Holt, Rinehart and Winston. Telecommunications Board (2000) Washington, 3 Molander, R. C., Riddile, A. S. and Wilson, P. A. DC. (1995), Strategic Information Warfare: A New Face 7 Institute of Crisis Management: http://www. of War, Washington Rand Distribution Services. icm.org (August 2001). 4 The United Kingdom PR industry Internet 8 The ‘Miami University Resources for Dealing with Commission identified the nature of this transfer Hate Crimes and Bias-Motivated Incidents’: of information in terms of: porosity, being the http://www.muohio.edu/nohate/Resource.htmlx enhanced leakage of information from organiza- (August 2001). tions; transparency, in which organizations make 9 Phillips, D. (1999) Managing Your Reputation in information available and internet agency where Cyberspace London: Thorogood. people (and intelligent machines) act as an agent 10 Cyveillance, 1555 Wilson Blvd, Suite 404, Arling- in changing the nature of messages. ton, VA 22209 2405 (www.cyveillence.com). 5 The Cisco parody site is located at: http:// 11 www.motherjones.com www.angelfire.com/ego/frugal (August 2001).

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 20 2 3 4 The impact of terrorist attacks on 5 6 corporate public relations 7 8 Donald K. Wright 9 10 1 2 3 4222 5 This chapter explores how the corporate communication and public relations professions 6 were affected by the September 11, 2001 terrorism attacks on the United States. Data 7 were gathered between September 2001 and March 2002 in several stages involving 8 both quantitative and qualitative methodologies. Results found two-thirds of the corp- 9 orate PR executives surveyed thought the events of September 11 have changed how 20 their companies communicate. This suggests that the terrorist attacks have had an impact 1 on their organization’s PR and communication function. The author explains how the 2 terrorist attacks have precipitated a paradigm shift advancing public relations into a more 3 signiﬁcant role in corporate America and how company executive teams have since 4 5 become more aware of the importance of communicating openly, effectively, and in a 6 timely manner. 7 8 9 30222 Many things have changed since September demic literature discussing their impact. 1 11, 2001, when terrorists hijacked four aero- However, the popular literature reports on a 2 planes and attacked the United States destroy- number of research studies involving a variety 3 ing the World Trade Center, causing signiﬁcant of general public audiences, and echoes the 4 damage at the Pentagon, and killing thou- reality that these terrorist attacks had a huge 5 sands of innocent people. Immediate emo- impact upon American opinion. Kohut says 6 tional reactions of horror, anger, shock, they ‘brought unparalleled national unity and 7 sadness and disbelief appeared to lead to a patriotism’, ‘elevated the importance of 8 realization the nation was vulnerable. This, in nationhood’, and ‘changed the way (Ameri- 9 turn, stimulated enhanced security, increased cans) view the world’.1 40 patriotism, renewed interest in religion, and a A CNN/USA Today/Gallup poll conducted 1 greater sense of family throughout America. on the evening of September 11 found Ameri- 2 Given the large publication time gap for cans considered the events of that day repre- 3222 most scholarly articles, there is limited aca- sented ‘the most tragic news event’ of their

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors lifetimes.2 A study by CBS News and the New should become a national holiday.11 A Gallup York Times discovered the American public’s Organization study said more Americans think trust in government doubled in the weeks the attacks have changed the country than immediately following the attacks.3 This they have impacted individual lives.12 tragedy had a huge impact upon the approval ratings of President George W. Bush. His CNN/USA Today/Gallup poll scores hovered Purpose of the study around 50 per cent in early September, but surged to 90 per cent by 22 September and The major goal of this research was to explore remained in the 85 per cent range in mid- the impact the September 11, 2001, terrorist 4 January, 2002. And, according to the Inter- attacks have had on corporate communica- national Herald Tribune, 79 per cent of those tion and public relations in the United States. outside the United States claim the events The study sought answers to questions con- of September 11 ‘marked a new chapter in cerning whether or not the events of that 5 world history’. Tuesday changed how organizations com- Six months after the attacks, CNN/USA municate, and whether or not the attacks Today/Gallup poll research continued to find have had any impact on corporate PR and most Americans thought September 11 repre- communication functions. In a related line sented ‘the most tragic event of their life- of analysis, the study explored several addi- times’, and most (76 per cent) did not believe tional, but closely related, questions. The the nation’s ‘wounds’ resulting from the momentous nature of the September 11 attacks had been healed.6 American support terrorist attacks raised the possibility that any for increased defence spending in March research of this nature might discover an 2002 was nearly three times higher than it immediate, or primacy, effect. Consequently, had been four years earlier.7 At the same data were gathered through a variety of differ- time, however, this research found Americans less affected by the attacks in March 2002 ent quantitative and qualitative research ‘than they were in the immediate aftermath of methods and over a six-month period of time Sept. 11’.8 from September 2001 through March 2002. With the passing of the immediacy of A second and equally significant purpose of September 11, the New York Times opined that this research examined theoretical implica- since that day, ‘Almost all the news – eco- tions, in particular those that might link any of nomic, political, international – seems to have the study’s empirical findings to excellence spun from that one day, although that one theory, the behavioural model theory, and the day was merely a single episode in a global communication executive role. struggle that has taken years to develop.’9 The Associated Press reported ‘the attacks altered the attitudes and assumptions of most Methods Americans’, but also stressed ‘there is no real consensus about the nature and permanence Data were gathered between September of the changes’.10 Nearly half of those inter- 2001 and March 2002 in several stages viewed in a March 2002 CNN/USA Today/ involving both quantitative and qualitative Gallup poll said they thought September 11 methodologies.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Quantitative methods professionals was selected. Responses were 2 received from 37 subjects during the October 3 The study’s quantitative measuring instru- 2001 data-gathering phase and from 38 4 ments consisted of two, short, email question- respondents in March 2002, representing 5 naires distributed to senior-level, US-based, respectable return rates of 67 per cent and 6 PR and corporate communication executives. 69 per cent respectively. 7 The first of these questionnaires was dissemin- While critics might suggest this study’s 8 ated on 10 October 2001, one month after population was small, the purpose was to 9 the attacks. The second was circulated on focus on truly senior-level corporate com- 10 9 March 2002, six months after the tragedies. munication and PR professionals. In academic 1 Sampling was purposive and intentionally terms, we were interested in what communi- 2 small in an attempt to restrict participation to cation executives – not everyone in the United 3 only the most top-level corporate and agency States who practises public relations – thought 4222 professionals, and, in the case of some very about the impact of the September 11 terror- 5 large companies, the second and third people ist attacks.14 In addition to representing names 6 in the communication function. Anonymity of some of the most senior-level professionals 7 was promised to all participants. in the United States, respondents included 8 Short email questionnaires were selected four past presidents of the Arthur W. Page 9 for data gathering based upon our previous, Society, a select membership organization for 20 successful experiences conducting survey senior public relations and corporate com- 1 research with senior-level, PR and corporate munication executives, and nine members of 2 communication executives. Our research has the Page Society’s Board of Trustees. The 3 found communication executives rarely com- study’s participants included many of the 4 plete mail questionnaires, and are extremely leading corporate and agency professionals in 5 difficult to pin down for telephone interviews. the United States as well as three past presi- 6 And in terms of electronic surveying, we have dents of the Public Relations Society of 7 found return rates significantly higher when America (PRSA), and a past president of the 8 questions are asked as part of a regular email International Public Relations Association 9 text message as opposed to situations where (IPRA). 30222 subjects are invited to click upon an embed- Anonymity and confidentiality were prom- 1 ded link which would take them to a web- ised to all participants. Participants in this 2 based survey questionnaire. research have approved all quotes attributed 3 Another limitation in surveying truly to them. The October and March question- 4 senior-level communication executives is the naires both asked four, closed-ended ques- 5 reality that there are very few of them. Wright tions on a set of five-point Likert-type answer 6 claims there are only 250 to 300 communica- scales ranging from ‘Strongly Agree’ to 7 tion executives in the United States.13 Working ‘Strongly Disagree’. 8 carefully with membership rosters of the The four closed-ended questions in the 9 Arthur W. Page Society, the Public Relations October 2001 questionnaire were: 40 Seminar, the Public Relations Society of 1 America College of Fellows, and the Inter- • Do you agree the events of September 11, 2 national Public Relations Association, a sam- 2001 will change how your company 3222 ple of email addresses of 55 senior-level communicates?

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors • Do you agree the events of September 11, ment any noted, strategic public relations 2001 have had any immediate impact on effort during the Vietnam conflict years of the your organization’s PR and communica- 1960s and 1970s. tions function? Although the two noted world war com- • Do you agree managed, strategic communication campaign efforts received con- munications and public relations can be siderable praise for keeping the American effective weapons of war? public behind the cause of those wars, such • Do you agree the United States will imple- was not the case during the Vietnam era ment a managed, strategic communica- when a large percentage of the US populations and public relations campaign in the tion opposed the military action. A major current struggle against terrorism? reason the October questionnaire asked questions about the use of strategic public October respondents also were invited to add relations during war was to measure how open-ended comments following each ques- important senior-level communication execution. The first two questions focused directly tives thought these might be in the campaign upon the events of September 11 – one asking against terrorism. how the terrorist attacks might change how This study’s first questionnaire was distrib- companies communicate; and the other uted on 10 October 2001, four weeks follow- asking about any immediate impact on the PR ing the terrorist attacks and three days after and communication function. the first round of US military retaliation in Two of the October questions were Afghanistan. Responses received up to 22 designed to measure thoughts and opinions October 2001 were included in the analysis. regarding how strategic PR and communica- An obvious methodological concern about tion campaigns might impact military retalia- research of this nature focuses upon whether tions the United States was taking in an the initial – and potentially emotional – reac- attempt to combat terrorism. The United tions of PR executives remain constant over States has a long history of effectively imple- time. For example, did the fact that so many menting managed and strategic communica- US civilians were savagely murdered in the tion and PR campaigns when the country has September 11 attacks prompt initial concerns been at war. This was particularly evident that would diminish as the nation, and the during the First World War when President world, adjusted to the tragedy? In an attempt Woodrow Wilson asked crusading journalist to control for this possibility, all US-based sub- George Creel to establish the Committee on jects in the study were surveyed again in late Public Information (CPI).15 And, in the Second March 2002, six months after the attacks. World War years when Elmer Davis was head The March questionnaire also contained of the Office of War Information (OWI).16 four, closed-ended, Likert-type questions. Two Steinberg says US public relations efforts in of these were similar to October questions the First and Second World Wars, ‘provided with two minor changes necessary with the the stimulus for the development of public passing of time. Those questions were: relations into what many of its contemporary practitioners like to call a full-fledged profes- • Do you agree the events of September 11, sion’.17 In spite of this success during the two 2001 changed how your company com- world wars, the United States did not imple- municates?

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • Do you agree the events of September 11, October and March email questionnaires; 2 2001 have had any impact on your email conversational interviews with subjects 3 organization’s public relations and com- who entered into periodic, electronic dialogue 4 munications function? with the researcher; plus several telephone 5 and personal interviews with subjects in this 6 Analysis of the October data suggested the study. Qualitative data gathering began in 7 terrorist attacks might have precipitated a September 2001 and continued up to March 8 paradigm shift advancing communication and 2002. 9 public relations into a more significant role 10 in corporate America. Furthermore, some 1 evidence suggested the events of September Data analysis 2 11 triggered some executive leadership teams 3 within many companies to become more Quantitative responses were imported from 4222 aware of the importance of communicating the author’s emailbox and data were coded 5 openly, effectively, and in a timely manner. and entered into the Statistical Programme for 6 Consequently, these two questions became the Social Sciences (SPSS). Responses to each 7 part of the March questionnaire. question were then broken down into fre- 8 quency response percentages and means. This 9 • Do you agree the September 11, 2001, yielded most of the information necessary to 20 terrorist attacks precipitated a paradigm describe the study’s findings. Finally, multiple 1 shift advancing communications and statistical tests were run on the data in an 2 public relations into a more significant attempt to measure for any significant differ- 3 role in corporate America? ences between October and March responses. 4 • Do you agree your company’s executive Specifically, a t-test was run comparing both 5 teams have been more aware of the of these groups of respondents. Qualitative 6 importance of communicating openly, data were analysed via informal content 7 effectively, and in a timely manner since analysis. 8 September 11, 2001? 9 30222 March respondents also were invited to Results and discussion 1 answer this open-ended question: ‘In the 2 space below, please feel free to offer any com- RQ1: Do senior-level corporate public rela- 3 ments regarding the impact the events of tions executives believe the events of 4 9–11–2001 have had on public relations and September 11, 2001 changed how their 5 corporate communications.’ companies communicate? 6 7 As Table 20.1 shows, roughly two-thirds of the 8 Qualitative methods senior-level, US-based, corporate communica- 9 tion executives surveyed in this study agree 40 In addition to the study’s quantitative meas- the tragic events of September 11, 2001 have 1 ures, data also were gathered through a vari- changed how their companies communicate. 2 ety of qualitative methods. These included Differences between perceptions in October 3222 responses to open-ended questions on the 2001 and March 2002 are minimal, although

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Table 20.1 Responses of senior-level, US PR and corporate communication professionals to the question: ‘Do you agree the events of September 11, 2001, changed how your company communicates?’ (%)

Strongly Agree Uncertain/ Disagree Strongly Mean agree no opinion disagree

Responses from survey of October 2001 19 50 6 23 3 3.59 Responses from survey of March 2002 17 50 17 17 0 3.67

Note: Mean scores were calculated on five-point, Likert-type answer scales ranging from ‘1’ for ‘strongly disagree’ to ‘5’ for ‘strongly agree’. Consequently, in this and all subsequent tables, the higher the mean score, the greater the agreement the March mean score is slightly larger. Open- made changes in how they communicated ended comments related to this first research externally as a result of September 11. As one question clearly suggest these changes will senior-corporate officer said, September 11 alter many aspects of future internal and ‘has put many issues in a different perspec- external communication. tive’. Another pointed out, ‘The tone of com- As far as internal communication is con- munications will be balanced against a cerned, immediately following the September backdrop of daily reminders about how pre- attacks a number of companies reviewed cious and fragile freedom is.’ Several March their employee communication practices and survey respondents stressed the terrorist policies in an attempt to develop methods attacks appeared to serve as the catalyst to that could help get information to employees help corporate officers recognize the import- more quickly. Results of the March follow-up ance for organizations to have and maintain survey provide every indication this trend is open channels of communication. Both sets continuing. Respondents to both surveys of survey responses contained comments pre- pointed out more information is being dicting companies will be facing reduced demanded by employees, and some com- levels of urgency around certain issues, petty panies stress these employees now want it matters, and small agenda items. Some antic- delivered in the most expedient fashion. This ipate American business will show, ‘a much is forcing a number of organizations to recon- stronger resolve to succeed in the face of a sider traditional internal communication difficult economy as a way of not letting printed documents such as brochures and terrorism win’. newsletters in favour of email and intranet In terms of specific communication chan- delivered information. Respondents to the nels, respondents to both waves of the study’s March survey particularly stressed they have survey suggested internet and intranet sys- seen an increased interest in disseminating tems were becoming more important because internal information regarding security issues they have the ability to enhance information more frequently and more expeditiously since dissemination more quickly and more effi- the September 11 attacks. ciently than other communication media. Although neither as extensive nor as Others pointed out corporate PR and com- immediate, a number of companies also munication professionals now are making

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 greater use of the internet and intranet sys- on their organization’s public relations and 2 tems and are going beyond simply communi- communications function? 3 cating with publics to a point where they are 4 trying to develop relationships with them. As Table 20.2 reports, the study found excep- 5 Many believe the attacks caused companies tionally strong agreement that the September 6 to revisit their crisis communication plans. 11, 2001 terrorist attacks have impacted the 7 In October, some predicted future business corporate PR and communication function. In 8 might be conducted in a more serious mood October, 88 per cent agreed with this sugges- 9 with fewer jokes and much more emphasis tion while 92 per cent agreed in March. 10 on patriotism. March responses appear to Relative agreement was higher in October 1 validate that this is happening within some given a larger number of responses in the 2 organizations. ‘strongly agree’ category. 3 There were those who, in the October The October survey found 88 per cent of 4222 survey, did not anticipate change resulting the respondents thought the events of 5 from September 11. As one said then, ‘once September 11 had an immediate impact on 6 people get past the horror of 5,000 deaths, their company’s PR and communication func- 7 the crisis will pass and things will settle down tion. This figure increased to 92 per cent in 8 again’. Other October respondents thought March, but the latter survey’s mean score was 9 the attacks might impact what is communi- slightly lower on this item because the inten- 20 cated, but not how messages are dissemi- sity of agreement was not as strong as it had 1 nated. Results of the March survey find fewer been five months earlier. The need to com- 2 sceptics. A few March respondents thought, as municate quickly to employees and other 3 one subject reported, ‘it’s pretty much back to strategic target audiences appears to be 4 business as usual except for those companies significant here. Results to both survey waves 5 that were devastated by the attacks’. discovered a number of respondents indicat- 6 However, the majority disagreed and suggesting the terrorist attacks provided PR and com- 7 ed the events of September 11 had changed munication functions with opportunities to 8 how their company communicates. take on roles that CEOs and other executives 9 now view as more important and more cen- 30222 RQ2: Do senior-level corporate public rela- tral to organizational success. Following the 1 tions executives believe the events of attacks, communication and PR functions 2 September 11, 2001 have had any impact now appear to be responsible for more 3 4 Table 20.2 Responses of senior-level, US PR and corporate communication professionals to the 5 question: ‘Do you agree the events of September 11, 2001, have had any impact on your 6 organization’s public relations and communication function?’ (%) 7 Strongly Agree Uncertain/ Disagree Strongly Mean 8 agree No opinion disagree 9 40 Responses from survey of October 2001 25 63 6 3 3 4.03 1 2 Responses from survey of March 2002 9 83 4 4 0 3.96 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors important and more significant assignments ate given time and place. March survey results than was the case prior to September 11. As suggest this had softened some, but corporate one October respondent wrote, ‘The horror public relations officers clearly thought the that took place that day gave communica- situation was better in March 2002 than it tions a chance to help senior managers in had been prior to September 11. In October, my company lead.’ Another pointed out, ‘Our the PR and communication function appeared public relations and communications function to be playing a more significant role in help- is in a stronger position, because we were able ing companies decide what they should do to serve so effectively September 11 and and how they should do it in addition to every day since then.’ And one offered this helping them decide what to say and how comment, ‘We are now discussing everything, to say it. This also appeared to be the case in and our corporate communications profes- March. sionals have been thrust right into the center A number of March respondents thought of virtually everything the company does.’ the impact of September 11 might have been A high-ranking officer in one of the world’s escalating over time. Senior-level consultant, largest public relations agencies said, ‘We E. Bruce Harrison, said, ‘The CPRO role is have changed how we communicate to our escalating. It’s logical. All corporate top execu- employees and how our clients communicate tives are now extraordinarily sensitized to the to all of their publics.’ Open-ended comments potential for sudden events, including a crisis. to the March survey echoed and reinforced During times of crisis, CEOs and others in top these thoughts. One such comment, from a management instinctively turn to commun- senior-level, chief PR officer, was, ‘Following ications and involve the CPRO. This lights the attacks the CEO and others turned to us for the entire communications board.’ Matthew P. help much more frequently than ever before. Gonring, who at the time had recently And, because we were able to deliver when stepped down as Vice President, Corporate called upon, those people continue to seek Communications, Baxter International Inc., our assistance. 9–11 really changed the com- said the impact of September 11 continued to munications milieu in our company.’ have a huge influence upon a variety of In some instances, the initial new-found aspects closely related to corporate commun- appreciation for public relations and com- ications. Included on Gonring’s list are a munication developed out of having corpor- greater use of the internet and intranet sys- ate communication professionals take the lead tems, greater relevance of messages and in organizing fundraising and relief assistance impact, increased corporate security, reliance efforts during September and October. In on alternative means of travel, and the oppor- other 2001 situations, CEOs and executive tunity for corporate PR executives to exhibit heads of other corporate functions sought leadership qualities. advice from communication and PR profes- Analysis of various open-ended responses sionals before taking actions that previously in both waves of the survey suggests impact had been considered fairly routine. Immed- for the corporate public relations and com- iately following the attacks, organizations munication function in the following areas: appeared to be much more sensitive about what they said and did, how they put things • mobilizing organizational change; forward, and whether actions were appropri- • influencing policy making;

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • participation in decision making; • greater reliance on non-traditional media, 2 • advising CEOs; especially by those under 40; 3 • advising other senior executives; • greater focus on safety, security, family, 4 • gaining more access to CEOs; home, personal heath, etc.; 5 • helping the value of public relations to be • many unprecedented opportunities to 6 better understood; lead through communication. 7 • demonstrating that communications is 8 vital to the business; RQ3: If senior-level corporate PR executives 9 • enhancing the counsellor role for chief PR believe the events of September 11, 2001 10 officers; changed how their companies communi- 1 • awareness of the potential impact on all cate and/or impacted their organization’s 2 businesses; public relations function, will the intensity 3 • increased security, exposed vulnerability, of these beliefs have changed between 4222 more secretive operations; October 2001 and March 2002? 5 • much greater reliance upon internet and 6 intranets; On the question asking whether or not the 7 • appreciation and understanding about events of September 11th changed how com- 8 relevance and impact of messages; panies communicate, mean scores were iden- 9 • appreciation of the importance of timeli- tical (3.59) for the October and March 20 ness re information dissemination; respondents. Results of t-tests displayed in 1 • many are now avoiding opportunistic Table 20.3 suggest no statistical differences 2 behaviours; between the respondent groups. 3 • much more emphasis upon corporate In terms of the question asking if the terror- 4 social responsibility; ist attacks had any impact on ‘your organiza- 5 • many are re-evaluating the need to travel; tion’s public relations and communications 6 • rapid growth in non-travel communica- function’, the October mean score (4.03) was 7 tion – web casting, online chats, voice and slightly higher than the March mean (3.90), 8 video teleconferencing; but results of t-tests, as shown in Table 20.3, 9 • family, god and country have become indicate no statistical significance. 30222 much more relevant to many; As the statistical tables suggest, the October 1 • more effort on shoring up existing cus- wave of this study’s survey found consider- 2 tomers rather than attracting new ones; able evidence suggesting the September 11 3 • greater need for improved internal com- terrorist attacks precipitated an immediate 4 munication; impact upon corporate public relations and 5 • more interest in crisis services including communications. Results of the March follow- 6 planning and drills, outsourcing of crisis up wave provide every indication this impact 7 needs; continues. Consequently, differences between 8 • new appreciation of biotech’s role in com- answers to both of these questions in October 9 bating possible bio terror; and March are minimal. 40 • advertising revenue spending is reducing When results of all qualitative data gath- 1 the journalism ‘news hole’; ered between September 2001 and March 2 • noted staff cutbacks in many media oper- 2002 were analysed, findings revealed four 3222 ations; uniquely different groups of communication

Mean scores Levene’s test for t-test for equality equality of variances of means

October March F Sig. T Sig. 2001 2002

Question Do you agree the events of September 11, 2001 changed how your company communicates? 3.59 3.67 0.533 0.469 0.080 0.937 Do you agree the events of September 11, 2001, have had any impact on your organization’s public relations and communications function? 4.03 3.96 1.78 0.188 0.591 0.558

executives. A small minority did not believe There was only moderate agreement and a the terrorist attacks were having any lasting fair amount of uncertainty in terms of findings impact upon corporate communication and to research questions 4 and 5. As Table 20.4 public relations. The other three groups shows, a majority (52 per cent) of the March included those who suggested the impact of respondents agreed the September 11 attacks September 11 upon corporate public relations had precipitated a paradigm shift advancing was highly pronounced, respondents who said communication and public relations into a an impact was evident but moderate, and more significant role in corporate America. those who thought that the terrorist attacks However, 23 per cent disagreed this was the had served as a catalyst for change along with case and 27 per cent were uncertain. There other contributing factors – mainly the Enron was slightly greater agreement (64 per cent) scandal and the sluggish economy. Those who regarding whether or not corporate executive perceived the impact of September 11 to have teams have been more aware of the import- been the most prominent were most likely to ance of communicating openly, effectively, have been relative newcomers to the position and in a timely manner since September 11. of an organization’s chief PR officer.

RQ4 and RQ5: (4) Do senior-level corporate Qualitative results public relations executives believe the events of September 11, 2001 precipitated A careful examination of open-ended res- a paradigm shift advancing communica- ponses combined with the realization of tions and public relations into a more which subjects agreed with these statements signiﬁcant role in corporate America? (5) and which respondents did not, sheds an Are corporate executive teams more aware interesting and important light on the situa- of the importance of communicating tion. More than half of those who disagreed openly, effectively, and in a timely manner with the two questions articulated in Table since September 11, 2001? 20.4, did so mainly because they believe that

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 20.4 Responses of senior-level, US PR and corporate communication professionals to additional 2 questions in March 2002 (%) 3 4 Question Strongly Agree Uncertain/ Disagree Strongly Mean agree no opinion disagree 5 6 Do you agree the September 11, 2001, 7 terrorist attacks precipitated a paradigm shift advancing communications and 8 public relations into a more significant 9 role in corporate America? 18 32 27 23 0 3.45 10 Do you agree your company’s executive 1 teams have been more aware of the 2 importance of communicating openly, 3 effectively, and in a timely manner since 4222 September 11, 2001? 18 46 14 23 0 3.59 5 6 7 8 prior to September 11: (1) corporate public communication has been taking place in their 9 relations had established a strong tradition of company for many years. 20 playing a significant role in their company; Although this research was conducted with 1 and (2) their organization’s executive teams promises of anonymity and confidentiality, 2 recognized years ago the importance of com- several subjects identified their responses and 3 municating openly, effectively and in a timely provided additional permission to be quoted 4 manner. Given the reality, these respondents directly in results reports. This included five 5 essentially were not disagreeing with the very senior-level corporate public relations 6 questions reported on in Table 20.4, the level professionals. Each of these individuals was 7 of agreement actually would be considerably asked to provide a direct quote in October 8 higher – nearly 65 per cent for RQ4 and 2001 assessing the impact the September 11 9 greater than 75 per cent for RQ5. Further- terrorist attacks were having on their jobs. The 30222 more, while taking precautions not to violate same five senior-level professionals were 1 the study’s promises of anonymity and confi- asked to review their quotes in March 2002 2 dentiality, it is important to point out that sev- and explain how, if at all, their opinions might 3 eral of those who disagreed with these two have changed. 4 questions are very senior-level corporate com- Quotes from these five professionals follow. 5 munication officers who have earned the 6 utmost respect from their professional peers. 7 Essentially, then, their responses to these Bill Nielsen, Corporate Vice President, 8 questions might need to be overlooked. They Public Affairs and Corporate 9 disagreed with the paradigm shift thesis Communications, Johnson & Johnson 40 because corporate public relations already 1 was extremely significant in their organiza- October 2001 2 tion. And, they disagreed with the executive My company’s employee communications 3222 teams question because that kind of open came to the forefront following September

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 11th because stockholders and employees March 2002 demanded to know more about what was The only difference now is that one of the going on throughout the organization. ﬁve retired, so it is four senior executives. Otherwise still accurate, but the sense of March 2002 urgency has abated. Employee communications are still extremely important. Interestingly, the Enron matter has probably also heightened E. Ronald Culp, Senior Vice President, the interest of employees in knowing what Public Relations and Government is going on. Affairs, Sears, Roebuck and Company October 2001 Matthew P. Gonring, Vice President, The September attacks created a demand Communications, Baxter International for faster communications, especially around employees and issues involving October 2001 security. It enhanced the role of the communications March 2002 executive especially as it applies to being a My October quote still appropriately counselor and advisor to senior corporate echoes how I feel. management.

March 2002 E. Bruce Harrison, President, E. Bruce I still feel much the same way, but I would Harrison Company and Senior expand upon this and say the events of Consultant, International Truck and 9/11 brought greater attention to the Engine Company relative importance of communications, especially the role of senior counselor and October 2001 advisor. As the result of what happened September 11 the CPRO (Chief Public Relations Ofﬁcer) role is escalating. It’s logical. All company Curtis G. Linke, Vice President, top executives have become extraordinarily Corporate Communications, Deere sensitized to the potential for sudden & Company events, including a crisis. During times of crises, CEOs and others in top management October 2001 instinctively turn to communications and The terrorist attacks prompted Deere & involve the CPRO. This lights the commun- Company to propel the communications ications board. It starts with employee function into the lead of a senior manage- communication but spreads quickly to ment, policy making team. Now headed by stakeholders throughout various channels – me, this group consists of ﬁve of the com- security, sales, stockholders, investment pany’s most senior executives, and has advisors, supply, transportation, parts, etc. pledged to keep employees informed on As the expert on communicating – two- anything that might affect their workplace way, symmetric – the CPRO is at more or their home place. tables and more important tables.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 March 2002 Additional findings 2 The basics of relationship and reputation 3 have not changed. However, I see chief Nearly every respondent (97 per cent) to the 4 communications officers putting new October survey agreed managed and strategic 5 energy into their continuous evaluation of communication and public relations can be 6 the impact of external conditions on critical effective weapons of war. And an equal 7 stakeholders. There is a mandate for excel- number (97 per cent) thought the United 8 lence in the communicator’s role as coun- States would implement such a campaign in 9 selor to others in the company on the the struggle against terrorism. Neither of these 10 interactions (which are not achievable questions was followed up in the March 1 without two-way communications) that research in order to accommodate queries 2 sustain trust. If there were ever a time about the paradigm shift and executive teams 3 for the CPRO to become ‘chief trust officer’, recognizing the need to communicate openly, 4222 it is now. effectively and timely. 5 6 7 Intervening variables Summary 8 9 Evidence of two potentially significant, inter- This research study of senior-level, American, 20 vening variables surfaced a number of times corporate PR executives explores how corpor- 1 in analysis of the March results. One of these ate communication and public relations were 2 concerned the impact the economic recession impacted by the September 11, 2001 terror- 3 of early 2002 might have been having upon ism attacks on the United States. 4 corporate public relations. The other involved Data were gathered between September 5 the potential impact precipitated by issues 2001 and March 2002 in several stages 6 such as organizational mismanagement, lack involving both quantitative and qualitative 7 of corporate trust, etc., arising out of the methodologies. The study’s quantitative 8 Enron Corporation scandal. Although not measuring instruments consisted of two, 9 prompted to do so in any of the March ques- short, email questionnaires distributed to 30222 tions, about half of the subjects who provided senior-level, corporate PR executives in 1 open-ended responses to this wave of the October 2001 and again in March 2002. 2 survey suggested that either or both of these Sampling was purposive and intentionally 3 two variables might be more significant for small in an attempt to restrict participation to 4 changes in corporate communication behav- only the most top-level corporate and agency 5 iour than reactions to the September 11 ter- PR professionals. Short email surveys were 6 rorist attacks. In terms of the economy, US used because our previous research has dis- 7 public relations was facing a steady downturn covered communication executives rarely 8 in business prior to the attacks and this trend complete mail questionnaires, and are 9 was continuing into March. In some cases extremely difficult to pin down for telephone 40 corporate staffs had faced layoffs, but even interviews. 1 more pronounced were cutbacks at technol- Additional data were gathered through a 2 ogy companies and within many public rela- variety of qualitative methods, including 3222 tions agencies. responses to open-ended survey questions,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors email conversational interviews with subjects, ples showing evidence of implications of plus telephone and personal interviews with excellence theory and behaviour model a small number of subjects. Results found theory in the perceived impact the terrorist two-thirds of the corporate public relations attacks have had on corporate public rela- executives surveyed thought the events of tions. The study reports on a number of September 11, 2001 have changed how theoretical implications of both theories their companies communicate. The intensity based upon both quantitative and qualitative of feelings on this question increased slightly findings. Specifically, the research found a between October and March. Findings also number of instances where the events of reflect strong agreement (88 per cent in September 11 have served as examples October; 92 per cent in March) suggesting the of ‘latent readiness’ and ‘triggering events’ terrorist attacks have had an impact on their as articulated in the behaviour model. Also, a organization’s public relations and communi- number of examples were found relating to cation function. When data were submitted to ‘two-way asymmetrical’ and ‘two-way sym- t-tests, no significant differences were deter- metrical’ communication as described in mined between October and March excellent theory literature. A number of impli- responses. cations vis-à-vis the excellence theory con- The study also found moderate agreement cerning the role public relations plays in an suggesting the terrorist attacks precipitated a organization’s dominant coalition also are paradigm shift advancing public relations into expounded upon in the study’s results and a more significant role in corporate America. discussion section. Two-thirds of the respondents agreed their All in all, the senior-level corporate PR exec- company’s executive teams have been more utives surveyed in this study report the aware of the importance of communicating September 11, 2001, terrorist attacks have openly, effectively, and in a timely manner had a significant impact not only upon how since September 11. companies now communicate but also on how This research also found a number of exam- many corporate PR departments function.

NOTES

1 Andrew Kohut, ‘Nationhood, Internationalism perhaps, but no apocalypse now’, International Lifted,’ a report for the Pew Research Center, Herald Tribune, online version, 11 March, 2002. February 14, 2002. Available at http://people- Accessed at: http://www.iht.com/cgi -bin/generic. press.org/commentary/display.php3?AnalysisID cgi?template=articleprint.tmphlandArticleld=4 =44 (27 February, 2002). 2409. 2 Frank Newport, ‘Americans Still Consider Sept. 6 Newport, ‘Americans’. 11 Most Tragic Event of their Lives’, Gallup 7 Kohut, ‘Nationhood’. Organization Poll Analysis Report, 11 March, 8 Newport, ‘Americans’. 2002. Accessed online, 11 March, 2002 at http:// 9 ‘Six Months Later,’ editorial, New York Times, 11 www.gallup. com/poll/releases/pr020311.asp. March 2002, p. B7. 3 Kohut, ‘Nationhood’. 10 David Cary, ‘Americans differ on how Sept. 11 4 Jill Lawrence, ‘Bush has more challenges lined up changed them’, Associated Press, 11 March in 2002,’ USA Today, 18 January, 2002, p. 5A. 2001. Accessed online 11 March 2001 through 5 David Ignatius, ‘Commentary: a changed world, America Online.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 11 Patrick McMahon, ‘Holiday wins grass-roots M. Dozier, ‘Advancement for public relations role 2 favor’, USA Today, 12 March, 2002, p. 3A. models’, Public Relations Review (1986), 7, 3 12 Newport, ‘Americans’. 37–56. 13 Donald K. Wright, ‘validating credibility measures 15 James O. Mock and Cedric Larson, Words That 4 of public relations and communication: interviews Won the War, Princeton, New Jersey: Princeton 5 with senior-level managers and executives from University Press, 1939. Also see, George Creel, 6 other corporate disciplines’, Journal of Com- How We Advertised America: The First Telling of the 7 munication Management (1998), 3, 105–18. Amazing Story of the Committees on Public 8 14 For information about the communication execu- Information That Carried the Gospel of Americanism 9 tive role see, Donald K. Wright, ‘The role of corp- to Every Corner of the Globe, New York: Harper orate public relations executives in the future of and Row, 1920. 10 employee communications’, Public Relations 16 Alan M. Winkler, The Politics of Propaganda: The 1 Review (1995), 21, 181–98; and, Donald K. Ofﬁce of War Information 1942–45, New Haven: 2 Wright, ‘Validating credibility measures of public Yale University Press, 1978, p. 4. Also see, Robert 3 relations and communications: interviews with L. Bishop and LaMar S. Mackay, ‘Mysterious 4222 senior-level managers and executives from other silence, lyrical scream: government information 5 corporate disciplines’, Journal of Communication in World War II’, Journalism Monographs, 19, Management (1998), 3, 105–18. For information (May, 1971). 6 about other roles public relations professionals 17 Charles S. Steinberg, The Creation of Consent, 7 function in see, Glen M. Broom and David New York: Hastings House, 1975, pp. 29–30. 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Jacquie L’Etang

In this chapter some key criticisms against public relations are examined. From ‘spin doctors’ to ‘champions of discourse in society’, the debate on the role of public relations shows no sign of abating. Indeed today’s media hungry society seems only to fuel the debate. Using a historical analysis of the PR profession in the United Kingdom, the author seeks to explore some of the factors that have challenged the role of public relations through empirical evidence in a variety of political, social and economic contexts. She identiﬁes some precise contributions to democratic as well as anti-democratic practices and provides deeper insight and broader understanding of public relations today; its interpolation within the deep structures of society; and sources of the mythology that plagues the PR profession.

‘Spin doctors’, ‘hidden persuaders’, invisible defence of the industry has been somewhat persuaders’, ‘charlatans’, ‘anti-democratic’: lacklustre and a little unconvincing, partly these are typical contemporary criticisms of because the industry is unregulated and the public relations. What lies behind such accu- large majority of practitioners are not mem- sations appears to be the fear of manipulation bers of the professional body. This makes the and the secretive and inappropriate access to task of professional bodies in the United power, subterfuge and the employment of Kingdom, the Institute of Public Relations and hype and selective silences to enhance the the Public Relations Consultants Association, case of the organization on whose behalf very difﬁcult since they cannot claim to repre- the practitioner works. Criticisms are aired in sent all practitioners, and while they have well the popular press and in the academic jour- publicized codes of practice, they certainly do nals and books of media researchers. Indeed, not control the practice. This in turn reduces an increasing amount of popular argument is their potential as a media source, the media being marshalled against the legitimacy of PR often preferring to turn to individuals such practice and the ethics of its practitioners. The as publicist Max Clifford whose undoubted

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 personal charisma and connections with the carried out by the Greeks or the Romans, as 2 worlds of celebrity, entertainment and politics well as journalists and activists such as 3 make him irresistible. As a non-professional Jonathan Swift, Daniel Defoe, Charles Dickens 4 occupation the parameters of practice are still and William Wilberforce. Such definitions 5 unclear and barriers to practice (as opposed to imply that persuasion, rhetoric, sophistry, 6 membership of professional bodies) still do advocacy and lobbying are a central part of 7 not exist. Historically, since public relations PR practice. There is an inevitable tension 8 emerged as a discrete occupation in the between this acknowledged heritage and the 9 United Kingdom, its practitioners have been contemporary professional notion of public 10 challenged by journalists. In its defence, PR relations as part of management, a move 1 practitioners and some academics have which suggests a respectable, technocratic, 2 argued that public relations enhances dis- neutral function. 3 course in society and thus in fact contributes Historically, embryonic ideas about a for- 4222 to democracy. This chapter explores some of malized information occupation emerged from 5 those ideas through historical analysis both debates about the implications of widening 6 of the pattern of development and of some of democracy. Political elites recognized that pub- 7 the occupation’s intellectual history. lic opinion management (and communication) 8 The chapter focuses on the history of public was now crucial to ruling in a democracy but 9 relations in the United Kingdom. History pro- feared the rule of the mob as franchises were 20 vides empirical evidence of the role of public widened. In the 1920s the American political 1 relations in a variety of political, social and writers Lasswell and Lippman were key in 2 economic contexts and it is possible to identify developing a number of important analyses. 3 some precise contributions to democratic as Lasswell expressed serious concerns about the 4 well as anti-democratic practice. Such an development of propaganda in the First World 5 analysis provides a fuller understanding of the War which he saw as marking ‘the collapse of 6 role of public relations and its interpolation the traditional species of democratic romanti- 7 with the deep structures of our society. It also cism’ (Ewen, 1996: 174). It was Lasswell who 8 permits some analysis of the sources of introduced the Taylorist metaphor of engineer- 9 mythology about public relations: both its ing to PR work and his compatriot, Lippman 30222 demonology and its evangelism. introduced another – the manufacture of con- 1 sent. Lippman’s pessimistic view of mass soci- 2 ety led him to recommend the creation of a 3 Literary antecedents and cadre of communication specialists who would 4 intellectual history of public be given privileged access to elites and events 5 relations and who would subsequently be responsible 6 for brieﬁng the media (Lippman, 1998). It 7 There is an assumption in much of the existing could be argued that this rather Platonic 8 PR literature that public relations was ﬁrst arrangement was an early example of the 9 developed in the United States and then notion of neutral, technocratic communica- 40 exported elsewhere, a view that this article tors, having access to, yet separate from, elite 1 challenges. Another feature of historical re- power, and charged with responsibility for 2 views within PR literature is the way in which public communication. This class of people 3222 PR practice is defined as akin to activities would be responsible for educating the masses

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors about public policy options. This theme of ers’ emerging ambitions for status and influ- education became important in PR discourse. ence in an increasingly sceptical post-war It was taken up strongly by the influential world (L’Etang, 2000: 91). The idea that Scottish film documentarist and communica- public relations should be a powerful force in tion expert, John Grierson, who wrote exten- society was therefore rooted in the early ideas sively on problems of democracy and the about the practice in Britain. importance of public relations in facilitating Grierson’s influence was enhanced by his democratic practice. Grierson had been influ- connection with Sir Stephen Tallents, an ex- enced by Lippman, under whom he had tremely influential mandarin in the civil ser- studied in the United States, and shared much vice who had the concept of a ‘school for of his pessimism, writing, for example, that he national projection’ to promote Britain had abroad. This subsequently became the blueprint for the British Council, a body whose noted the conclusion of men such as Walter cultural diplomacy remains important to Lippman, that because the citizen under British interests overseas, targeting elites and modern conditions, could not know every- the ‘successor generation’ in a wide variety of thing about everything all the time . . . countries. Tallents commissioned members democratic citizenship was therefore of the British Documentary Film Movement, impossible. We . . . turned to the new wide- of which Grierson was the acknowledged ranging instruments of radio and cinema as leader, to make a number of important educa- necessary instruments in both the practice tional and propaganda films on social and of government and the enjoyment of political issues and helped ensure the survival citizenship. of the film unit. (Grierson and Hardy, 1946: 78) The context within which Tallents operated was one in which issues of communication Grierson wrote extensively during the 1930s had been debated since the propaganda and 1940s about the problems of com- efforts of the First World War. Within local munication in an increasingly complex and government there was an important contribu- technologized world. Although he was a tion made by officials who, due to increasing film expert his thinking went far beyond the social, educational and welfare provision (a merely technical. For him, public relations trend begun by the Great Reform Acts of the and propaganda were overlapping notions early nineteenth century), needed to com- that offered a solution to the threat of alien- municate more, and more effectively, with ation and the possible breakdown of society. local communities. The intellectual contribu- An analysis of the Institute of Public Relations tion in terms of the history of public relations (IPR) journals from 1948 demonstrates that in the United Kingdom was significant. Local much of Grierson’s idealism influenced the government officials in Britain in the 1920s post-Second World War generation of practi- and 1930s developed key PR concepts tioners who began to professionalize the field. and contributed in an important way to PR Professional status requires social legitimacy, ideology, particularly in relation to concepts so Grierson’s grandiose notions of the import- of professionalism in the articulation of their ant role for public relations in society (drawn own public service ethos. Their ideas were from Lippman) thus resonated with practition- expressed in a range of articles published in

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 the specialist journal Public Administration and justification of the role of public relations was 2 demonstrated their understanding of the that it was an administrative or managerial 3 importance of monitoring the wider environ- tool both to counteract the negative results of 4 ment to aid and influence public policy. Public specialization within organizations, and to 5 relations was seen as a tool to facilitate motivate the workforce. This seems to have 6 smooth administration. It was local govern- been the earliest explicit claim in a British 7 ment public relations officers who formed context that the role of public relations is to 8 the nucleus of those responsible for setting support management. Like Lippman and 9 up the IPR for which task they clearly pos- Grierson, Brebner argued that the PR practi- 10 sessed the appropriate administrative skills. tioner should have senior status and access to 1 The contribution of British civil servants to the the policy makers in an organization. 2 development of public relations in the United Thus we can see that the shape and trajec- 3 Kingdom was substantial both in terms of tory of British public relations has been influ- 4222 practice but also intellectually and ideologi- enced partly by intellectual developments 5 cally. A prime value for them was that of originating in the United States but also by 6 government responsibility for the public inter- some key home-grown thinkers and policy 7 est and in their writings we can see a clear makers. 8 articulation of what could be called ‘the 9 public interest model of public relations’. 20 The idea that public relations should work Critical issues 1 in the public interest remains today and is 2 alluded to in professional codes of conduct. Intrinsic to the concept of contemporary 3 The notion of professional neutrality re- democracy is the idea of popular debate and 4 mained an important value in the British the resolution of issues via discussion and 5 Government Information Service after the negotiation. However, in a free society debate 6 Second World War and was an important between the organizational actors, publics 7 contrast to the heavily politicized American and individuals is a consequence of specific, 8 counterpart. Latterly, however, there is evi- directed intentions, usually focused on per- 9 dence of the erosion of that principle. suasion, and not conducted as an end in 30222 It was not until 1949 that the first British themselves. In other words, corporate com- 1 book on public relations was published munication has to support the goals of an 2 (Brebner, 1949). It was written by the practi- organization and is not explicitly conducted 3 tioner J. H. Brebner whose distinguished to support democratic values, although some- 4 career included public relations at the Post times this might be a side-effect of such com- 5 Office; membership of the committee which munication. Thus, communication in modern 6 set up the Ministry of Information (MoI) in democracies is a haphazard and contingent 7 1937; Director of the News Division, MoI; affair in terms of democratic practice, how- 8 special overseas operative 1943–5; Director ever focused and goal-oriented it may be 9 of Press Communications at Supreme Allied in organizational terms. To claim that 40 Headquarters; public relations at the British public relations is either specifically promot- 1 Transport Commission. Apparently influenced ing or undermining democracy is overstating 2 by management writers Taylor and Barnard, either case since it is an outgrowth of funda- 3222 Brebner’s argument for the existence and mental political and social structures and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors international flux and transformations. So space available for individuals and less well- while the concept of a valuable role for public off groups to debate issues of importance to relations in facilitating the ‘free market place them. The relationship between sources and of ideas’ in a capitalist, competitive context the media explored by a number of media might seem attractive, it always has to be sociologists (Hall, 1969; Schlesinger, 1990; remembered that public relations activities Anderson, 1993; McNair, 1996; Miller, 1998; may be utilized to support some potentially Dinan, 2000; Davis, 2002) has focused on anti-democratic ideals. In an open society the implications for citizens to the public it is inevitable that different causes will utilize sphere. Such analyses rely to some degree public relations to advance their positions, on the notion that the moral principle of fair- and it seems increasingly the case that in times ness, which seems important for democracy, is of organizational or organizational–public potentially infringed by PR practice. In other conflict communication will include a meta- words issues, and the way they are framed argument about the nature of communica- are done so in terms of government and tion, both by the participants who may hurl corporates, and competing interests and lines the slur of ‘propaganda’ against their oppo- of argument are not heard. It is worth point- nents and by the media who will be searching ing out, however, that there is still a limited for examples of ‘spin’ or hypocrisy. amount of empirical work in the field. It is The concerns of media academics have also the case that media sociologists on largely focused on structural inequalities in the whole focus on relationships between the complex society that privilege corporate and media and public relations to explore and government institutions at the expense of condemn the extent of their influence. Such smaller organizations and causes. For exam- a focus omits an exploration of the non- ple, while tending to conflate advertising, media aspects of PR work and its influence in marketing, propaganda and public relations the public sphere and upon publics, public Chomsky’s analysis that the media serve the opinion and society more widely. It is also the interests of state and corporate power ‘fram- case that the substantial academic critiques ing their reporting and analysis in a manner emerging from media sociology have not supportive of established privilege and limit- been addressed by the PR discipline which ing debate and discussion accordingly’ does has until relatively recently largely excluded imply the need for elite networkers, wheeler- critical debate as being ‘unhelpful’ to the dealers, rhetoricians and lobbyists who can practice. Media academics to varying degrees put their case across (Chomsky, 1989). One reflect the prejudices of journalists and may argument is that those with ‘deep pockets’ therefore regard PR academics as either nefar- can fund expensive public relations cam- ious or unthinking functionaries operating in paigns which disadvantages ‘resource-poor’ an atheoretical and thus inferior environment. groups and this is the line taken by Gandy in Consequently, debate is still polarized into his notion of information subsidies which opposing camps which inhibits analysis of illustrate that structural inequalities in society what is actually a very complex practice. Even can be reinforced by public relations and the at the level of basic definitions the history media (Gandy). Another approach is that of public relations has led to considerable those with resources clog the channels of confusion over terminology, the relationship communication and dominate the limited between the various related occupations such

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 as public relations, design, advertising and The substantial critiques emerging from 2 marketing, not to mention the confusion over media sociology have not been addressed by 3 the degree of overlap or distinction between the PR discipline, as will now be discussed. 4 public relations and propaganda. In short, Existing narratives of the origins and develop- 5 much that is written conforms to existing dis- ment of the PR occupation are largely Ameri- 6 ciplinary conventions and agendas and as can. One interpretation has come to dominate 7 such inhibits our understanding of the role of – that developed by J. Grunig and Hunt, 8 public relations in democracy. which suggests that public relations has 9 A very valuable revisionist approach is passed through four developmental stages: 10 taken by Davis (2002). He identifies a number publicity, public information, asymmetrical 1 of gaps and contradictions in media sociology and symmetrical communication. Somewhat 2 literature, not least its strong bias towards simplistically, the first two stages are described 3 examining political public relations at the as ‘one-way’ communication in comparison 4222 expense of corporate (though this may be to the ‘two way’ types of which the asym- 5 somewhat corrected by the output of an ESRC metrical variety employs research techniques 6 study currently under way at the University of to support its persuasive efforts, while the 7 Stirling). Davis’s empirical work shows that symmetrical type is motivated to achieve 8 the assumption that larger resources necessar- consensus between an organization and its 9 ily lead to better media coverage is flawed in publics. The models are focused on organiza- 20 relation to corporate public relations. Specific- tion-publics and therefore do not take 1 ally he points out that, account of the broader ‘public interest’, and 2 so have a somewhat different approach to 3 Direct corporate source influence on the British tradition. Much of the literature 4 national news production in the UK has promotes the idea that this evolutionary 5 been significantly weaker than most model is universally applicable both as a 6 accounts assume. The logics that guide both historical explanation and as a typology that 7 journalist routines and business communica- satisfactorily explains professional practice. 8 tion objectives each suggest that companies Yet it fails to take account of significant cul- 9 are neither able, nor strongly inclined, to tural and political factors in non-US settings 30222 concentrate their efforts on influencing the and its monolithic application in deductive 1 output of mainstream news texts. Rather, research and status as a worldview has inhib- 2 they tend to pursue public promotion ited the development of research grounded 3 through advertising and political objectives in the daily practice of public relations. 4 through direct contact with policy-makers. Historically speaking it is a rather superficial 5 Thus, if public relations is benefiting the account of developments, perhaps because 6 corporate sector it cannot simply be on the main interest is in characterizing types of 7 account of its ability to influence national practice rather than piecing together the com- 8 journalists and public opinion. plex collage of human endeavour in mass 9 (Davis, 2000: 45–6) communication. 40 The dominant paradigm is broadly liberal 1 Instead he argues that corporate goals are pluralist and sees public relations as support- 2 better served by advertising and through dis- ive of democracy, opening up channels of 3222 creet access to policy makers. communication and facilitating dialogue

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors between organizations and publics. According clear that the devil is in the detail in terms of to this view, public relations is neutral, benign illustrating the real implications of public rela- and broadly utilitarian. The dominant para- tions for democratic practice. To date equiva- digm therefore chooses to ignore the intrinsic lent work has not been tackled in the United self-interest necessarily present in the repre- Kingdom. sentation of an interests and advocacy on behalf of an organization. The major contribution of the American PR Evolution of public relations in the theorist and historian, Scott Cutlip, should not United Kingdom be ignored. His approach differs from that of Grunig and Hunt as he argues that, Public relations in the United Kingdom developed primarily in the state sector as a con- The history of public relations cannot be sequence of political, economic and social told by simply saying that it grew out changes. The approach taken here is to link of press agentry. Nor can it be fully told in the evolution of public relations to those terms of people such as Ivy Lee or Arthur broader changes. This is in contrast to some Page. Efforts to communicate with others histories of public relations which give much and to deal with the force of public opinion emphasis to individuals, thus taking Thomas go back to antiquity; only the tools, degree Carlyle’s approach that ‘History is the biogra- of specialisation, breadth of knowledge, phy of great men.’ Historiographically speak- and intensity of effort are new. ing, this type of analysis can lead to the (Cutlip, et al., 1994: 89) exaggeration of the importance of individual, creative effort and the idolization of the few. Cutlip et al. (1994) identify a number of key A classic example in the literature is the treat- periods in American history focusing on the ment of the American practitioner Edward twentieth century showing the important Bernays, whose real historical contribution is links between events in international affairs rather obscured, not least because Bernays and politics, economics, technology and was such a self-publicist and lived to the age the growth in both the media and public of 104, his good genes thus enabling him to relations. But as Cutlip pointed out in his enhance and promote his contribution long groundbreaking volume Unseen Power (1994), after most of his contemporaries. Of course writing the history of public relations in the this is not to say that at certain points in United States is impossible without also writ- history the contribution of one or two individ- ing a history of the United States itself. The uals produces a particular crux in PR history sheer scale and impracticalities of writing a but it is important to recognize the reasons complete American history led him to take a why those individuals had the opportunities more biographical and consultancy-based they did to develop their skills and not to approach. Cutlip’s admission shows that the overplay their signiﬁcance. Individual oppor- emergence of public relations is clearly tied to tunism could only ﬂourish in certain condi- democratic structures. tions. Analyses that focus on the identity of Significant scholarly American corporate ‘the father of public relations’ (one wonders histories have been tackled by Tedlow (1979), about the mothers) seriously limit our under- Olasky (1987) and Marchand (1998) and it is standing of the relationship between public

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 relations, environmental factors and the cultivated notions of media independence 2 consequent institutional structures that shape and truthful information, there was an exten- 3 our lives. sive internal and external propaganda effort. 4 The reason that the state contribution in ‘Black’ propaganda (defined as communica- 5 the United Kingdom was so paramount was tion which entails deception and untruths) 6 two-fold: first, Britain’s international position was considered morally justifiable in the 7 as a colonial power (L’Etang, 2003) required circumstances and somewhat romanticized. 8 the management of a host of domestic and The head of SOE’s ‘F’ Section was Colonel 9 worldwide publics; second, social reform Maurice Buckmaster who had worked for Ford 10 gathered pace from the early nineteenth Motor Company prior to the war. After the 1 century which required a major shift in the war he became Director of Public Relations at 2 climate between the government and its sub- Ford and subsequently went freelance repre- 3 jects. Unlike the isolationist United States, senting the French champagne industry. He 4222 Britain’s history dictated close involvement in became a fellow of the IPR in 1954 and was 5 European areas and particularly with the president in 1955. The career of such a man 6 other major colonial powers of France and clearly demonstrates the overlap between 7 Germany. Communications were needed to public relations and propaganda and the diffi- 8 support diplomacy. For example, it required culty in separating the two terms. 9 substantial propaganda efforts on Britain’s The emergence of totalitarian politics in 20 behalf to persuade the United States to continental Europe in the 1930s and the 1 become involved in both world wars (even so, growth of home-grown versions stimulated an 2 the United States did not participate until ongoing policy debate about the British 3 1917 and 1941). The two world wars, and the response to such developments and the neces- 4 international unrest which preceded them, sity of a propaganda policy to respond to the 5 facilitated the growth of what was, initially perceived threat. Thus it was at this point 6 unproblematically, termed ‘propaganda’. in history that the term ‘propaganda’ began to 7 Modern war and the advances in com- be tarnished and associated with particular 8 munication technology contributed greatly political structures and ideologies. There was 9 to the development of propaganda. The much debate in British political circles about 30222 increased democratization of society necessi- the appropriateness of a propaganda policy 1 tated public opinion management in times in a democratic society in peacetime (its use in 2 of war. Government needed to control and wartime was deemed inevitable and justifi- 3 censor unfavourable information that might able) and whether it was right to adopt such 4 harm morale; to penetrate enemy communi- tactics in order to compete with the totali- 5 cation networks in order to confuse or de- tarian states. The idea that propaganda was 6 moralize; and to win and maintain alliances a necessary adjunct of diplomacy began to 7 from which political, economic or military prevail. 8 support might be forthcoming. In wartime the In terms of domestic politics there was 9 British government made substantial propa- an increasing awareness by politicians of 40 ganda efforts both at home and overseas. The the need to manage public opinion (and 1 wartime experience sensitized civilian and their own personal image) in an increasingly 2 military populations to issues of propaganda, democratized state. Consequently, some 3222 information and intelligence. While Britain civil servants became specialized in media

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors relations. Some of these took their skills into tious of the extent to which US practitioners the private sector. For example, one of the exported their ideas to the British. earliest PR consultants in the United Kingdom Nevertheless, Britain’s international PR and was Sydney Walton, who set up business in propaganda efforts taken together with the 1920, having previously worked as press offi- intellectual and practical efforts of British civil cer for Lloyd George. Another, who has been servants show that British public relations credited by some as being Britain’s first fully emerged in its own unique way arising from fledged PR consultant was Basil Clarke, a the immediate context and was not purely the former Daily Mail journalist who later directed consequence of imported ideas from America. the Special Intelligence section at the Ministry of Reconstruction, then moved to the Ministry of Health and finally became Director of Public relations and the media: a Public Information in Dublin Castle until he troublesome and troubled left in 1926 and set up his own agency, relationship Editorial Services, which he founded jointly with two practising consultants, R. J. Sykes of The emergence of public relations immedi- London Press Exchange (LPE) and James ately threatened the professional role and Walker of Winter Thomas. Some have argued freedoms of journalists. Although PR practi- that Basil Clarke was the ‘father’ of public tioners saw their role as helping the media, relations in Britain in the 1920s partly because journalists could not but see them as a barrier of his well-established and impressive record to access to policy makers. Tensions grew in government and partly because he drafted rapidly after the Second World War as the PR the first detailed code of practice, much of occupation expanded against a backdrop of which formed the basis of codes of the rapid change in the media. The end of paper Institute of Public Relations for many years. rationing in 1956 meant that advertisers, now Basil Clarke’s son claimed that his father had using market research, could target audiences known Ivy Lee but it is difficult to check how more effectively. Newspapers that could not much contact the two men had and Ivy Lee deliver audiences were subject to closures and junior wrote to me in a letter in 1998 that, ‘I the industry began to contract (Williams, don’t remember ever having heard of him 1998: 213–20). In this context, public re- [Basil Clarke] . . . neither my brother nor I lations appeared to offer what seemed to be have any recollection of my father having con- free publicity. Thus the post-war generation tact with any British practitioners.’ On the began to focus more on publicity and stunts. other hand, the Scot, John Grierson, suggested Out-of-work journalists were well qualified to a terminological influence when he wrote that move into such jobs and were also influential in Britain in the 1920s, ‘The word publicity in shaping the role of the occupation at this itself was set aside: the concept of public re- time in terms of practice, norms and values. lations took its place, borrowed oddly from Ex-journalists could offer clients the ability to the Chicago Transit Company under that old de-mystify the media as well as protecting thug Sam Insull . . . the key to public relations them. They therefore offered more tangible . . . was the dramatisation in every way, not of benefits than the other major category that the end-product, but of its sources’ (Grierson, formed the post-war influx into public re- 1956: 8) so perhaps we should remain cau- lations – the ex-army types who could

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 generally only offer bonhomie and social con- of the socio-economic framework: the large 2 tacts plus some administrative skill. amount of new social legislation needed to be 3 Post-war media criticism of public relations explained to citizens; goods had to be pro- 4 presented a problem for PR practitioners since moted, initially to export markets and then, 5 the IPR was trying to establish the occupation with the increase of consumer durables, to 6 as respectable. Media criticism focused on the home market; finally, the new adminis- 7 the perceived incompetence of practitioners tration’s interventionist economic policies 8 and ethical issues such as: apparent attempts required some explanation and triggered 9 to bribe the media with lavish hospitality; opposition from business in ideologically 10 the development of parliamentary lobbying; motivated rhetorical campaigns, for example, 1 work carried out on behalf of foreign interests those conducted by Aims of Industry (L’Etang, 2 some of which were opposed to British 2003). 3 government policy or interests. The rapid The emergence and growth of PR consul- 4222 expansion of public relations meant that tancies marked a distinctive historical devel- 5 sources had a better ability to raise issues and opment in terms of the professionalization of 6 frame news stories so the power balance public relations since it presumed sufficient between sources and the media was altered in 7 hold on certain crafts, knowledge, experience a way that journalists naturally perceived 8 and a sufficiently coherent identity for busi- 9 as unfavourable, both in terms of their pro- ness to survive, indeed thrive in the market- 20 fessional status, but also, to some degree, place. Such a development represented a 1 democracy. major shift in terms of public relations’ place 2 Historically, perhaps the most significant in the British economy and signals the point 3 aspect of the media–public relations tension at which there was a major uptake of PR 4 is the durability of the arguments over half services and thus public recognition of the 5 a century. Reading the stinging criticism by 6 journalists in the 1960s (L’Etang 2003) it is practice. The growth of consultancy was 7 clear that there are recurring themes and important for the process of professionaliza- 8 tensions between the two occupations and tion and eventually culminated in the forma- 9 while it could be tempting to assume that tion of the Public Relations Consultants’ 30222 such tension is healthy in a democracy the Association in 1969. 1 revolving doors between journalism, public The situation in Britain was very different 2 relations and politics seem less than desirable from that of the United States where all the 3 in terms of creating a privileged elite who big advertising agencies had public relations 4 share information and power in a way that departments in the post-war era. Consultancy 5 prohibits citizen debate. had much slower growth in the United King- 6 dom, partly because it took so long for the 7 British economy to recover after the Second 8 Post-war economic recovery: World War (Britain finished the war as the 9 the emergence of consultancy and world’s largest debtor nation). Economic 40 corporate rhetoric expansion in the late 1950s and early 1960s 1 stimulated the consumer and retail indus- 2 Post-war there were several opportunities for tries which in turn demanded editorial pub- 3222 public relations to become an established part licity to support advertising and marketing.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors By the late 1950s and early 1960s many PR strated that British public relations had its own consultants left their umbrella advertising distinctive trajectory derived from its unique organizations to establish their own clients. long history and colonial position. It is clear The interplay between consultancies, con- that PR practice evolved largely from different sumerism and the economic growth of the aspects of international and domestic policies 1960s was crucial. With hindsight we can see in a democratized context and that civil ser- that the growth of consultancy foreshadowed vice values made a substantial stamp on the the exponential growth of public relations British brand of public relations. Nevertheless, that, ‘has played a key role in the transforma- it can be seen that different intentions fuelled tion of British political and economic life in practice with some efforts specifically de- the 1980s’ (Miller and Dinan 2000: 5). signed to improve democratic practice and much else to improve the position of particular organizations. While the critiques of jour- Conclusion nalists can reveal nefarious practice in terms of media relations, there is still much that is This brief review has highlighted some of the hidden from view in terms of undue inﬂuence key features of the evolution of public re- behind the scenes and this remains a problem lations in the United Kingdom. It has demon- for PR ethics.

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 2 3 PART IV THE FUTURE IS NOW 4 5 6 7 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222 1222 CHAPTER 22 2 3 4 Visualizing the message: why semiotics is a 5 6 way forward 7 8 Reginald Watts 9 10 1 2 3 4222 5 Any concept that defines itself as the science of signs must offer a rich seam of new ideas 6 for the corporate practitioner. The author asks ‘if applied semiotics (the science of signs) 7 can inform the way non-linguistic images in corporate literature are analysed’. Non-lin- 8 guistic refers to anything from page design, logos and photographs to the choice of 9 material, print fonts and even to the binding itself. Despite the importance of the visual 20 component in communication, managers appear to find difficulty expressing themselves 1 when commissioning print material with non-written elements. This chapter aims to 2 show that semiotics can be used to reduce uncertainty in decision making by encourag- 3 ing practitioners to focus on individual elements that transfer meaning. In this way 4 5 unstructured decision-making can be reduced. Corporate practitioners also need tech- 6 niques to achieve consistency regardless of which executive signs off their material. 7 8 9 30222 Social semiotics within the context which are connected arbitrarily. This connec- 1 of corporate communication tion was by conventions which had to be 2 accepted by the reader. This indicates that in 3 The term ‘semiology’ derives from the work part, meaningful communication arises from 4 of Ferdinand de Saussure1 who stated that the relationships between elements in a 5 ‘a science that studies the life of signs within system of language, some elements of which 6 society is conceivable; it would be part of are more fixed than others. In this chapter I 7 social psychology and consequently of gen- extend this concept to a wider arena of signs 8 eral psychology: I shall call it semiology [from discussing how non-written or visual elements 9 the Greek semion “sign”].’ transfer meaning to a viewer. 40 Saussure attempted to explain the pro- The tradition of semiotics is not monolithic 1 cesses by which meaning was possible nor even an agreed body of theories and con- 2 through language and stressed that such signs cepts. It is a way of assessing the process by 3222 were composed of signifiers and signifieds which signs transfer meaning. A template is

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors developed in this chapter as an aid to analysis structuring and the linearity of the story set the for managers who lack training in semiotic foundation of the visual text. When partici- theory. pants are shown to be doing something to each other they are connected by a vector which forms a narrative that can show class, The application of semiotic theory ideology, and other meanings. Because of to the visual their size or position in the picture, the actor and the goal are often the most salient of the Kress and van Leeuwen2 in their seminal work participants. They contrast against the back- Reading Images, examined ways in which ground, the colour and its variations, the images communicate meaning. By looking at sharpness of focus of the picture, and possibly the formal elements and structure of design, through the psychological salience they have colour, perspective, framing and composition for the audience to whom the picture is they developed a visual grammar. intended. Visual representation not only expresses Kress and van Leeuwen use the word ‘par- meaning that is separate from, and often ticipants’ within a picture because it suggests different from, written text but it can have its something is actively happening by virtue of own grammar. Meanings arise out of the so- the participants’ involvement. There are two ciety in which people live. There is a plethora types of participant, the ‘interactive partici- of differences between societies and the pant’ who appears to be speaking or listening people in them but messages replicate these or is in some way in the act of communica- differences through contrasting codings. tion, and a subset which can be described as Communication takes place in social struc- ‘the implied interactive participant’, who is tures which are inevitably marked by power silently instructing us, the viewer, through the differences. This affects how each participant understands the notion of understanding. The design of the picture. commercial sign-maker needs to understand It is important how the participants relate what social changes are at work and whether to each other. One set of participants can, for they are understood in their interrelation. example play the role of ‘subordinates’ to at Language has always existed as only one least one of the other participants who is mode in a total list of modes which can be termed ‘superordinate’. Equivalence may or used in the production of a text. For the may not exist between subordinates and this majority of communication specialists, many can be visually realized by symmetrical or of them trained in the skills of journalism, the asymmetrical composition. The subordinates language mode has been paramount and the being placed at equal (or not) distance from one in which they received training. each other, given the same size (or not) and As a starting point we must accept that the same orientation (or not) towards the what in language is described in words such horizontal and vertical axes. as ‘action verbs’ are in pictures realized by Kress and van Leeuwen say that ‘When shapes or elements that can be termed vec- represented participants look at the viewer, tors. These may be realized, for example, by a vectors are formed by participant’s eye-lines’ ﬁgure pointing, an outstretched arm or the which connect the participants with the line of a building, roof or road. The visual viewer. Contact is established, even if it is only

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 on an imaginary level. There may be a further here there may be a form of idealized reality 2 vector formed by a gesture in the same direc- which is accepted as idealized by the viewer. 3 tion. This visual configuration can create a They may identify with the participants, 4 visual form of address by acknowledging despite the fact they know objectively it is a 5 the viewer explicitly or it can constitute fantasy environment where the sun always 6 an ‘image act’ whereby the producer uses shines and every car is in showroom 7 the image to do something to the viewer. This condition. 8 type of image is termed ‘a demand’. There is Kress and van Leeuwen argue that the 9 a demand that the viewer enters into a modern densely printed page has ceased to 10 relationship. be a significant textual unit of meaning 1 The relationship is often signified by other because words and concepts flow from one 2 means, perhaps by the facial expression of to the next and the flow can be broken by the 3 the represented participant. The converse of typesetter (or computer) at any point in the 4222 the demand is ‘the offer’, where the picture text without changing its meaning. The page 5 addresses the viewer indirectly. The viewer is becomes a single semiotic unit structured not 6 not the object but the subject of the look. No by its linguistic content but by its visual com- 7 contact is made. The viewer’s role is that of position. When the readers scan the page of a 8 an invisible onlooker. It offers the represented corporate brochure they are not necessarily 9 participants to the viewer as an item of linear in the direction and movement of their 20 information as though they were in a glass eyes. The eyes may go from centre to margin, 1 case. The contrast between the offer and in circular fashion or vertically and it becomes 2 demand is a choice which can be used to sug- a ‘nonlinear composition’, a form of page 3 gest different relations with different others to design which encourages multi-directionality. 4 make viewers engage with some and detach In western society it is assumed that what 5 6 from others. appears on the left is the given in informa- 7 It is normal for viewers to attach more cred- tional terms and what appears on the right is 8 ibility to some kinds of message than to new or not yet known to the reader. There is 9 others. Although reality is in the eye of the thus a sense of continuous movement from 30222 beholder the eye has had a cultural training left to right following societies’ left–right read- 1 and is situated in a social setting and a history. ing pattern. The word ‘given’ in this case refers 2 Realism for a particular group is an effect to what can be assumed to be known by the 3 of the practices which define that group. A viewer and the word ‘new’ is what is assumed 4 particular kind of realism is itself a motivated and cannot yet be known. 5 sign in which the values, beliefs and interests Composition of a picture or a page involves 6 of that group find their expression. Different different degrees of salience and, as such, 7 realisms exist side by side in the same cultural salience can create a hierarchy of importance 8 context. What is expected and accepted as among elements which can change the 9 real in one mode, say in a glossy magazine value between the ‘given’ and the ‘new’. 40 about the countryside where naturalism is as The perception of salience in speech results 1 close as the picture editor can achieve, may from a complex interplay between a number 2 differ from the case of photographs of cars in of auditory factors such as pitch, loudness, 3222 an automotive manufacturer’s brochure. Even vowel colouring and so on. Salience in visual

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors composition can be judged by visual clues The AIDA model and application which form a trade-off between a number of factors such as size, focus, tonal contrast Having caught the attention of the viewer a (borders perhaps between black or white), commercial brochure needs to offer informa- colour contrast (saturated versus soft colours), tion relevant to the interests of the target perspective, human faces or cultural symbol. cohort. It must generate a desire to do some- The use of depicted elements such as struc- thing, to excite the recipient to take a specified tural buildings lead the eye, abstract graphic action. This may be to ‘buy’ the product or elements lead the eye, tilting of photos lead accept a change of opinion (as in the case of the eye and different styles of photography, public affairs), or change an attitude towards, drawing, etc. all lead the eye. say, smoking, the use of narcotic drugs or to take more exercise. Questions have been clustered, therefore, The application of semiotic theory in the template as to whether, or not, they will to corporate literature produce data which relates to the A, attention getting function, or A + I where attention and During the sign-making process the social, cul- interest are closely merged. In corporate tural and psychological backgrounds of the material the need to gain attention is less than executives involved will combine and fuse in in a selling leaflet because there may have terms of the pressures on them of their com- been an approach by the viewer for corporate mercial training. The composite influence will information. However, there is still the need to guide the selection of what they, as a team, hold the attention at first glance. see as the criterial aspects of the text. They One area, for example, where sufficient are, in fact, looking for the most plausible research has been carried out to argue its signifiers to express a previously agreed signi- attention getting validity is in the use of fied. Commercial literature is usually ‘signed- colour. Marketing psychologists advise that a off’ by a senior manager before passing to lasting colour impression is made within 90 ‘production’ and it will be the executive seconds and accounts for 60 per cent of the who ‘signs-off’ who is most likely to use the acceptance or rejection of an object, place, templates described here. individual or circumstance. The colour con- Our objective therefore is to create a tem- sultant Georgiana van Walsum3 has written plate valid in terms of semiotic theory but that as those within the commercial world transmuted (perhaps translated is a more apt become scientifically literate, there is a move expression) into a format that is simple to use towards a recognition of the power of colour and meets commercial needs. beyond the purely aesthetic. Colour can be Commercial managers need systems that used as an effective shorthand for convey- demand a short time frame consistent with ing the values of a company and associating the cost/time equation which dominates an its services and products. It can be used to executive’s life. The template here has been persuade and motivate, to convince and developed therefore with questions structured persuade, to induce trust or create excite- around the generally accepted AIDA (Atten- ment. The colour red, for example, is highly tion, Interest, Desire and Action) model. charged. Jakobson4 argues that primary

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 colours have a meaning similar to that of the text which ‘catch the interest’. If sufficient 2 vowels and they suggest strength or weakness. ‘interest’ is aroused it is likely the recipient will 3 The 1960s fashion designer Mary Quant5 read more slowly and if the ‘desire’ is created 4 ‘sees red as expressing raw energy: hard, hot, consider whether to take ‘action’. 5 alive, sure, pushy and crude, blood and guts, The three stages of the model thus vary 6 cruel, sex . . . and it always works’. according to the interactive environment 7 Colour is only one of the factors that con- between the sign-maker and the representa- 8 cern us. The attention factor in the AIDA tive of the company. During the interaction, 9 model is difficult to achieve when the primary power will change from the superordinate to 10 function is to obtain sales but at corporate the subordinate participants and back again 1 level there is a more subtle, a more complex as the mental negotiation proceeds. In the first 2 interaction created by a matrix of processes. instance the end viewer (perhaps a potential 3 This does not mean the attention gaining customer, a journalist, a financial analyst, 4222 process does not require the same level of or a parliamentarian) may have instigated 5 analysis as a sales brochure, but it does sug- the dialogue because of a need for informa- 6 gest we should be aware of semiotic functions tion. The company representative or the arte- 7 that may come into play at first viewing and fact moves into a superordinate position as 8 those more likely to be decoded later. the supplier of the information. Different 9 The template developed below takes elements in the semiotic relationship come 20 account of the AIDA objectives. Those ele- into play. 1 ments most likely to be seen or noted first, Questions regarding salience, contextuality, 2 such as colour or the materiality factors where ellipsis, dimensions and non-compositional 3 its physicality is immediately apparent are influence, because they are less likely to 4 grouped under Attention. Elements concerned resonate when the viewer is only ‘glancing’ at 5 6 with the totality of the meaning such as narra- first sight in a showroom, have been included 7 tive and contextuality and its interaction with within the third section. It is then that the 8 the viewer are grouped later. reader’s/viewer’s interest may concentrate on 9 The words Attention and Interest as head- a full examination. The elements that re- 30222 ings have been used for the first two groups inforce, add to or delete from earlier mean- 1 but Desire and Action have been merged into ings but only transfer meaning after a slower 2 one heading as a final stage. Action need not more considered analysis (Desire-Action) have 3 be physical. The desire to change may be no been positioned in the last section. 4 more than a change of attitude or opinion To help in the understanding of how the 5 which although an action, is difficult to isolate questions might be used, the template has 6 within the psychological process. been applied to a single-page photograph 7 A brochure may arrive in the hands of the (Figure 22.1) taken arbitrarily from a Toyota 8 target recipient by post or from a company Annual Report (1995, p. 13). Following each 9 representative. The recipient will glance at the question is a typical response we might expect 40 product quickly and if the ‘attention’ gained is from the analytical team if they apply the 1 strong may either read it or put the text aside. concepts discussed. 2 At a second stage (Interest) a further examina- 3222 tion is made of the brochure, reading parts of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Figure 22.1 Toyota Source: Permission has been given by the Toyota Motor Corporation to reproduce this page (13) from their 1995 annual report

Analytical classiﬁcation

Attention (1) Identify signiﬁers/signiﬁeds and their causal relationships.

Response The following signiﬁers are apparent:

• two human ﬁgures; • white Toyota saloon with raised bonnet showing black engine;

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • Toyota name in red on rear display wall heart-shaped logo with word Tecno in close 2 proximity; 3 • participant in white shirt, no coat, clipboard held under arm by one participant who 4 5 is also holding a pen; 6 • second participant in dark suit, blue shirt; 7 • both participants wear dark ties. One participant without coat; 8 • in metalinguistic terms, page is gloss coated paper in full colour; 9 • the background display panel performs framing role. 10 1 (2) Identify narrative sequence, interactive participants and their vectoring (actor, goal, 2 recipient and the transaction. 3 4222 Response 5 The picture represents two males leaning over the raised bonnet of a car. One male is 6 pointing with his pen to an engine part while looking at the second male. The elements 7 are arranged symmetrically against a neutral background. 8 Reading from left to right from the ‘given’, or the ‘authority’, the actor acts upon the 9 engine (the goal) which is a metonym of the whole which is the car and the car is a 20 metonym for the Toyota company. The car extends the meaning by this act of pointing 1 which adds further attributes to the car. The engine then becomes the actor which forms 2 a transaction with the second male as goal. There is thus a double transaction which is 3 apparent to the viewer who is invited to assume a detached scrutiny. 4 There are a number of vectors which appear to control the meaning. They are: the gaze 5 of the left side human ﬁgure which ‘eyeballs’ the second, thus demanding the goal’s full 6 attention. The left arm of the actor on left is pointing to a part in the engine which creates 7 a vector that meets a vector running from the eyes of the goal male who is looking at the 8 point the left male is touching. There is thus an inverted triangle formed by the vector 9 from the top of the heads of the two humans which continues to its apex where the arm 30222 of one meets the eye-line of the second. 1 Other vectors apparent are the humans who form two sides of a rectangle joined by the 2 front edge of the bonnet. The fourth side of the rectangle opposite the bonnet is closed 3 4 by the bottom edge of the picture. 5 The central concentration is reinforced by two vectors formed by the underside of the 6 car, this leads the eye to the central bottom point of the picture and by the roof of the car 7 leading the eye into the central rectangle. 8 Further vectoring establishes a sense of framing. 9 40 (3) What are represented participants (people, places and things in the picture? They 1 can also be abstract concepts which could be a subject about which the images are 2 produced)? 3222

• People: Two males, the younger between twenty and twenty-ﬁve and an older, between thirty and forty years. The generational interaction is signiﬁcant in terms of the power relationship and the image projected. • Places: A single room, possibly an automotive showroom. • Things: From top-down the name of the manufacturer Toyota is carried in prominent sanserif lettering which is the same depth as, for example, the heads of the human participants. A secondary logo of a heart accompanying the words Tecno in same typeface but half the size. A saloon car with bonnet up, a clipboard, a pen/pencil, and a tie clip. • Abstract concepts: The picture carries no caption except words in white reversed out on blue rectangle saying ‘We’re squeezing waste and inventory out of our sales operations, just like Toyota has been doing at its plants for years.’ This quasi-caption appears to relate through its adjacent positioning in the text yet does not relate to the contents of the picture nor to the actions of the participants.

(4) What are implied interactive participants who silently instruct viewer through design of picture?

Response There are two implied participants. The ﬁrst reinforces the central concentration of meaning because viewer becomes the third or implied participant drawn into the transaction as an observer. The second is the designer of the picture who has used vectoring to hold the attention of the viewer in one place.

(5) Identify the carrier and possessive attributes. How do the participants ﬁt together to make a larger statement? There is usually a low degree of modality if background is plain or out of focus. Their purpose is still interactional but the interaction is with the viewer.

Response The human participants are not the primary subject but they are the creators of the meaning through their concentration on the third participant, the car. Without the human presence it would simply be a car with a raised bonnet. The pointing of one human participant to a part of the engine could be pointing to a fault or a problem. This possibility is removed by the smile on the face of the goal human participant whose stance of relaxed concentration shows him to be impressed and not concerned by the action of the actor who despite his youth has an assured air of conﬁdence created by the symbol of management efﬁciency, a clipboard. The fact he does not wear a coat establishes his ‘hands on’ approach to his work.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 (6) Note subordinate and superordinate participants. 2 3 Response 4 Although there is no covert taxonomy in the accompanying text we might assume that as 5 the written subject is sales the right side human is a customer and could therefore be 6 referred to socio-culturally as the superordinate participant. At the viewer’s ﬁrst glance 7 the superordinate participant is the left side human who is pointing, looking serious and 8 carrying the authority of a clipboard and indeed a pen as an extension to his hand. 9 10 (7) What are participant demands (image/viewer relationship/offer)? 1 2 Response 3 The viewer as an implied participant receives no direct demand. The modern technique 4222 of selling is to avoid direct demand but to include the prospect in what is intended to feel 5 like an objective analysis. A similar psychological positioning has been created by the 6 viewer as an implied participant watching a technical discussion between two authorita- 7 tive participants. 8 9 (8) Trace vectors and transactions (NB eye-line reactions and ‘circumstances of means’, 20 i.e. tools and user becoming one). 1 2 Response 3 The pen is a ‘circumstance of means’ and in being so takes an additional iconic authority 4 through advertising and other culture speciﬁc situations where executives around tables in 5 discussion are shown with a pen pointing at a document. 6 7 (9) What is the process of change (the ‘given’ and the ‘new’)? 8 9 Response 30222 The left side participant is established in the picture as the ‘given’. He is shown here as an 1 authority on the subject of the engine and is thus in a power relationship. He is the repre- 2 sentative of the company who can transfer knowledge to what the picture suggests is a 3 buyer. The process passes from left to right through the car to the ‘new’. 4 5 (10) What are the transitory spatial arrangements/concepts? Is participant a generalized 6 essence of: class; structure; meaning? 7 8 Response 9 The human participants represent a generalized essence of class through the classic cloth- 40 ing. Both are in suits and ties although one has removed his coat. The third participant, 1 the car, is shiny, white and would be seen as a symbol of a wealthy lifestyle. There are no 2 other participants in the picture that reduce this meaning. 3222

• Spatial? Response: The objects are spatial yet so tightly related through vectoring and composition as to establish a single purpose. • Locative? left/right. Response: The linearity is left to right. • Locative? top/bottom. Response: The positioning of the company name establishes its importance as an overarching ‘given’. • Locative centre/margin? Does centre unify the information or provide meaning from which the surrounding elements draw their own meaning? Response: The centre does unify the information but the surrounding elements do not draw their meaning from it although it is the reason for their existence in the picture. • Is there a ‘locative circumstance’ which relates other participants to a specific participant in a setting? Response: No. • Define the reading paths. Response: The reading path takes a circular route which starts at the intersection between the pointing hand and the eye-line of the second participant. From there the eye runs back up the two vectors and down again but within the context of the powerful presence of the car. • Indicate any motion (i.e. cat climbs tree). Response: There is an implied assumption that the left side human will follow with further pointing to other parts of the engine. • Identify co-operative interaction. Response: There is a co-operative element in that the vectoring draws the right side human who is probably before the ‘action’ in this picture a stranger to the left human, into a close relationship based on mutual technical interest. • Discuss multimodal and materiality in terms of typeface, quality of paper, shape/size of text and colour. Response: The modes in use in this brochure include the following: high gloss paper, full colour, hard spine binding, paper size A4, use of variable type size, colour (part of modality marker list): score on 1–5 basis, colour saturation (scale full colour saturation (5) to absence of colour (0)). Response: Score saturated full colour 4. Colour differentiation (scale maximum range (5) to monochrome (0)). Response: Score colour range 4. Colour modulation (scale full modulation (5) to plain unmodulated (0)). Response: Score colour modulation 4. Colour contextualization (scale absence of background (0) to full articulation/detail (5). Note level of degrees of focus, muddy dark background, high degree (5) low (0). Response: Score background context 1. Response: Score background focus 4. Representation (scale maximum abstraction (5) to maximum representation of pictorial detail (0)). Response: Score representation 4. Depth in perspective (scale from absence of depth (0) to maximum deep perspective (5)). Response: Score perspective 3. Illumination (scale full play of light/shade (5) to absence (0)). Response: Score illumination 3. Brightness (scale maximum degrees of brightness (5) to black and white (0)). Response: Score brightness 3. • What are the criterial factors in socio-economic terms? Response: The sign-maker has ensured only resonance for viewer will be one of affluent, traditional middle-class

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 lifestyle. This resonance is created by the suits and ties of the human participants 2 which transfer to the car. 3 • What are power relationships, (sign-maker to viewer)? Response: The sign-maker has 4 created the viewer and rejected any other potential purchaser. For example, there 5 may be wealthy purchasers from the world of ﬁlm, pop music, academia, or even 6 design, who could and would be interested in the car but have, by a paradigmatic 7 choice, been rejected. 8 • What is icon and symbol usage? The symbol attribute may have salience through 9 placement, focus or colour. Response: The only icon used is that of the heart placed 10 beside the sub-brand name TECNO with no explanation. The heart with its repre- 1 sentation of warmth may be an attempt to humanize the technological hegemony. 2 • What is representation of detail and tonal shades? Response: The representation of the 3 criterial elements is emphasized through the detail, locative positioning, depth of 4222 colour and use of neutral tonal shades. The three participants are thus emphasized as 5 such with each participant separated through the use of colour contrast, foreground- 6 ing and involvement in a network of vectors. 7 8 9 Interest 20 (1) Identify if and how people, places and things combine into meaningful whole which 1 is/is not an extension of the meaning 2 3 Response 4 The ‘people’ and ‘the thing’ (the car) combine through the use of vectors and fore- 5 grounding. The ‘place’ is less meaningful. It may be the collection point for a car whose 6 maintenance has been completed or a stand at an exhibition where one enthusiast is 7 discussing the technical elements with another. 8 9 (2) Unisemic or polysemic? 30222 1 Response 2 The picture is polysemic with each meaning unidirectional, one strengthening the other. 3 The meanings are apparent within the context of the text which accompanies the picture 4 and which refers to the sales operation. The left participant must be assumed, in the 5 absence of a caption, to be a salesman who is identifying sales strengths within the 6 engine. By pointing at one element and showing his own authority a second level of 7 meaning is adumbrated. The part of the engine to which the participant points is well 8 engineered so, therefore, is the rest of the engine and through that the sense of quality is 9 suggested for the rest of the car which is not visible. The expression of acceptance on the 40 face of the right participant is of pleasurable involvement in the discussion. Although the 1 picture is polysemic the second and third layers of meaning are not easily identiﬁed and 2 to the viewer may not be as readily accepted as by the right side participant. 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors (3) What is the integration of different semiotic codes? Is there an overarching code providing a logic of integration such as:

• A code of spatial composition, i.e. texts where elements are spatially co-present such as painting, magazine pages, etc? • A code of temporal composition in which texts unfold over time such as in speech, drama, opera?

Response All elements are co-present but the over-arching code is social and cultural because the viewer is expected to identify with the right side participant and, like him, become satis- ﬁed with the explanation given. Alternatively, to be party to what would then be a three- way discussion in which one person, the left participant, leads while the other equal partner, the right participant accepts the point of view of the left participant and the viewer should do so also.

(4) What are the locative circumstances and relationships regarding:

• foregrounding? • backgrounding? • is there foregrounding to create stress/contrast? • is locative function realized by overlap, gradient of focus, colour saturation, angles, curves and other geometrics?

Response The locative circumstance has been created through foregrounding, reinforced by colour contrast and vectoring, with geometrics playing a signiﬁcant role in reinforcing the importance of the central transaction. Overlap is used to place the right participant in front of the car to make clear that although the car is the point of the discussion it is the right side participant who is the goal and participant of decision.

(5) Is there social meaning present through coding especially regarding modality as:

• technological coding where concern is visual representation? • sensory coding where the pleasure principle is dominant as in art, fashion, cooking which conveys high modality? • is abstract coding used by elite talking to other elites? • what is the naturalistic norm where coding is generally accepted?

Response The text selects a model reader through its choice of code, style and assumption of a speciﬁc competence. A number of concurrent social codings are working within the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 picture. There is an implied technological coding as one participant appears to be empha- 2 sizing what is possibly a technological sales plus. There is a minimum of sensory coding. 3 For the fourth implied participant there is the sense of being a member of an elite 4 group of the two represented participants. This is an implied abstract coding. The overall 5 modality is created, however, through the accoutrements of the left side salesperson and 6 how the low modality normally associated with a salesman is reversed by the efficient, 7 hands-on stance of that participant. 8 9 (6) Note the different meanings created compositionally by multi-modality through 10 interrelated systems such as the informative value through placement of elements 1 (participants and syntagms that relate to each other and the viewer). Note the salience 2 elements such as participants and representation, the presence of interactive syntagms 3 which attract viewers to different degrees and which can be realized by placement in the 4222 foreground or background, their relative size, contrasts in tonal value (or colour), differ- 5 ences in sharpness, and any framing that creates dividing lines, or frame lines that 6 disconnect or connect elements of the image, signifying they belong or do not belong 7 together. 8 9 Response 20 The subject of the syntagm is placed centrally. The surrounding elements lend information 1 and purpose to that subject who is both actor and goal, creating a relay effect by passing 2 additional information to the third participant on the right side, who becomes the goal. 3 Salience is generated through the placement of the three participants in such a way that 4 they create their own framing, a rectangle that holds the viewer’s attention centrally 5 within the picture. 6 7 Desire/action 8 (1) Are there any trade-offs between discrete social cultural groups? 9 30222 Response 1 The identifiable human participants in upper socio-economic groups make a reference 2 contextually to comfortable lifestyles which can be enhanced through the purchase of 3 what the sign-maker sees as a metonymic symbol of ‘good living’. 4 5 (2) What is the salience of participants, by colour contents, human faces or cultural 6 symbols? 7 8 Response 9 The colour content is above the naturalistic in terms of saturation but normal if compared 40 to the saturation levels of television and some advertising. 1 2 (3) What is the relationship between text and visual, which comes first? 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Response The text is concerned with the sales operation and dealerships. The picture has no caption although a sentence concerning the squeezing out of waste does take the quasi-function of a caption. There is no reference to the picture to explain the meaning of the actions or dialogue within it.

(4) Visual ellipsis (what is left out but assumed).

Response What has been left out is any reference to why one part of the engine is being identiﬁed without any statement of what it is or why it has been selected. There is a visual ellipsis without an assumption of meaning.

(5) Is there an apparent strategic deviance, whereby the cultural classiﬁcation rejects an over arching strategic message?

Response There is deviance as a result of the clothes and classical style of the human participants who form an established sense of who the target should be. In doing this they are excluding potential customers who have high disposable incomes yet do not subscribe to the classical form of dress and posture. Many in the media, the arts or even entrepreneurs reject such visible icons yet buy ‘high-end objects’ such as the car in the picture.

(6) What are the non-linear compositional factors? Readers may read a magazine from back to front or fall into their own reading pattern. Is there a non-linear composition created by the producers for their own agendas?

Response There is no opportunity for non-linear compositional factors with the exception of what appears to be a reﬂection of the car in a mirror, plus marks on the background display panels which engage the eye and create an unknown factor due to the lack of cohesion with other items.

Commentary and summary page has to be assessed within the context of the full page, and for the purpose of identify- The example above shows some of the ana- ing narrative the full brochure has to be lytical tools available within the semiotic viewed as one. armoury. Such an extensive deconstruction It behoves the practitioner to select his/her would not be practicable if applied to a full own critical semiotic elements, assemble them brochure. In such cases each item on each within the AIDA model (TV and ﬁlm pose a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 different set of requirements because there is tools with direct relevance to the work of the 2 normally only one opportunity to view) and corporate communication practitioner and 3 create a template for use by the public affairs which, in an age where the visual has become 4 team. increasingly important, should be used in day 5 The underlying fact remains, within semi- to day practice. 6 otic theory there exists a range of analytical 7 8 9 NOTES 10 1 1 Saussure, F. de (1993) General Course in Lin- 4 Jakobson, R. (1968) Child Language, Aphasia and 2 guistics, New York: McGraw-Hill. Phonological Universals, Hague: Mouton. 2 Kress and van Leeuwen (reprinted 2001) Reading 5 Quant, M. (1984) Colour by Quant, London: 3 Images: The Grammar of Visual Design, London: Octopus Books. 4222 Routledge 5 3 Georgiana Van Walsum, unpublished report 6 (1998) Commissioned by RW on behalf of Wace 7 Plc. 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Richard J. Varey

This chapter contributes a review of typical methodological commitments in corporate communication research, highlighting significant limitations and biases in the general field of applied communication ‘research’ in the corporate situation. The purpose served by management research with its particular outcomes is scrutinized. Popular ‘theories’ commonly in use in UK business and management schools are identified as are other theories that are obscured or omitted from research practice when ‘human communication’ is treated as no more than an informing control technology. The orthodoxy of instrumental managerialistic empiricism is characterized, highlighting the constraining dogma, and challenged. A balanced (or alternative) social science is proposed.

The epistemic domains of (personal, cultural things) and collectives communication theory in (communal, social things). The warrants to management studies know ‘good’ knowledge are, respectively, truthfulness, truth, mutual understanding When management researchers make claims and functional ﬁt. Validity is conferred by pur- to warranted knowledge, they necessarily suing and demonstrating, through method, make epistemological commitments with im- respectively, integrity, a correct account of plicit or explicit theories of what constitutes nature, a right worldview and system func- appropriate description and explanation of tionality. The phenomenon of people com- what goes on in people’s lives. Such claims, municating is generally treated as an ‘I’ or ‘It’ although often not actually ‘spoken’, tell the occurrence. Yet, only in the cultural domain of ‘reader’ to ‘listen’ and to take the work seri- intersubjective production of a right world- ously as legitimate, justiﬁed and authoritative. view can we truly speak of the ‘We’ action of Wilber (1996) shows that we make claims communicating. to know internal ‘things’ (intentions) and But, almost all managerially applied com- external ‘things’ (behaviour) about individuals munication theory is rooted in a cognitive

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 epistemic domain drawing fundamentally Of course, we have a ready explanation for 2 from an objectivist epistemology with an the relative dearth of application of these 3 objectivist ontology (Anderson, 1996). Thus, alternative knowledge-making approaches – 4 most knowledge of ‘communication’ is pro- instrumental rationality. 5 duced positivistically, premised on a purpose Management is understood as a knowledge 6 of control. Anderson identifies eighteen com- enterprise, increasingly with an emphasis on 7 munication theories that prevail in contempo- the management of trading relationships. Our 8 rary textbooks on human communication – experience can show us that the thinking and 9 they all fall into the positivist science domain talking of many practitioners, academics and 10 of knowing. These include the main theoreti- educators is largely unreflective, uncritical, 1 cal explanations in marketing, public rela- and poorly theorized. Management, now 2 tions, advertising, brand management, HRM almost ubiquitous in its application, remains 3 and other fields of management studies: largely a normative endeavour, with students 4222 almost universally concerned with ‘how to?’, 5 • agenda setting; rather than ‘why?’. 6 • dissonance theory; In taking a critical reading of management 7 • social judgement theory; (see, for example, Alvesson and Willmott, 8 • source credibility; 1992, 1996), we find cause for concern in the 9 • uncertainty reduction theory; discourse, conception of knowledge, model 20 • diffusion of innovation; and way of seeing human relating. Funda- 1 • theory of reasoned action; mentally, we see a politically motivated 2 • uses and gratifications; explanation for the common conception of 3 • cultivation analysis; communication for management that is 4 • meaning; hidden from scrutiny. 5 • communication pragmatics; Taking a Foucaultian view, the manage- 6 • spiral of silence. ment idea can be seen as a professional ideol- 7 This is a deeply worrying veiled limitation on ogy and a particular discourse, as well as a 8 knowing in this realm of human action and set of practices. These are each promoted 9 experience. and taken for granted and have become a 30222 common sense (‘truth’) of market-based capi- 1 talism (i.e. a consuming society). Manage- 2 Beyond the gates of ment continues to colonize further domains of 3 managerialistic hegemony society as this knowledge is deployed for the 4 management of ‘markets’. 5 Anderson (1996) identifies a range of theoret- Almost the entire discipline of manage- 6 ical resources from cultural studies, critical ment (both practice and academy) is prem- 7 theory, narrative theory, dramatism, social ised on a technical-rational view of the nature 8 action theory and structuration theory, that and purpose of knowledge. This positivistic 9 move beyond the cognitive domain to take and normative explanation of knowledge 40 account of the social action and discourse of drives a functionalist view of society and a 1 the lived world. To what extent do researchers scientistic pursuit of control through empiricist 2 of corporate communication draw upon examination of phenomena defined in micro- 3222 these? economic fashion.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors The whole management endeavour is thus ple, socially constructed realities – constructed cast by the prevailing ‘technicists’ as a neutral in the social processes of discourse. Meanings, instrumental technology of control. The possi- local knowledge and ongoing meaning- bility of a social (political) process is unrecog- making processes are explained. This alterna- nized or ignored. A managerialistic1 view is tive constructive participatory explanation of universally discussed, whilst a wide range of human interaction is not generally found alternative schools of thought lie undiscov- in the managerialistic (control-oriented) ered or discarded (even denounced). The literature. challenging books remain unread – the ques- The technology of manipulation that we tions remain unasked or unanswered. call management incorporates a particular The unseen menace in this unreflective way of seeing relationships and of relating pursuit lies in the location of managerialism to people (agents), objects (products) and within the process of constituting a particu- events (exchanges in ‘consumption situa- lar kind of society. Specifically, humans are tions’). Thus, ‘organizations’ are not under- treated as things (to be observed and manip- stood as social systems, but as technologies ulated), personal identity is reduced to of governance. This way of thinking favours ownership of commodities (brand), social those who manage by neglecting structures of relations are conceived in marketing terms domination and exploitation. Social relations (buyer–seller), and the question of the contri- are then ignored or objectified as variables bution of management work to the social to be managed. good is unasked by most. This leaves us to ask, among other ques- In the field of ‘managing relationships’, tions, what mental model prevails in manage- thinking is almost universally stranded in very ment education, scholarship, research and particular entitative taken-for-granteds. Per- practice? In an email discussion with David sonal characteristics of the individual person Ballantyne, he commented ‘I do see dialogue and context are treated as entities that exist as a “creating value” term, whereas communi- separately and independently of each other. cation is a “circulating value” term.’ Dialogue Relationships are understood as between is proposed as ‘reasoning together’ (drawing discrete entities, viewed as either subject or on Bohm, 19962) – a special kind of com- object. The subject is understood to act by munication, which is itself a special kind of gathering ‘knowledge that’ the other has interaction. Communication operated as a certain characteristics and to achieve ‘influ- participatory social action is constructive of ence over’ the other (as object) (Hosking, identity, meaning and knowledge (Deetz, 1995). A relational approach to organization, 1992, 1995), whereas the ‘conduit metaphor’ on the other hand, takes the unit of analysis conception of communication that is a foun- to be relational processes as the vehicle by dation of managerialism, places it as no more which person and culture are produced and than an informing technology. Then, there is reproduced. Subsequent talk of person and no free exchange in a value-creating inter- context then cannot treat them as indepen- action. Rather, this possibility is precluded, to dent entities but as outcomes of participation result in reciprocal manipulation. It is time in conversations that construct identities, that both the dominating management dis- meanings, and knowledge (Deetz, 1992). course and underlying ideology were more Thus, a relational perspective assumes multi- widely challenged.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 What’s wrong with empiricism? much ‘kitchen sink’ thinking that accretes and 2 confuses, when coherence, integration and 3 Empiricism and positivism are often conflated. creativity are needed. Social science is taken 4 The positivist inquirer tests theory against to be just like natural science in treating 5 empirical observation. The empiricist re- observer-independent features of the world 6 searcher tries to construct empirical general- ‘objectively’ (science is, by definition, objec- 7 izations or causal connections from data and tive, it is claimed). There is all too little know- 8 logic in observing empirical association. Thus, ledge making. 9 experiment and surveys are unreflectively 10 prevalent. For many, survey is field research. 1 Theories are accepted or rejected on their cor- In pursuit of methodological 2 respondence with facts ‘seen’ in the objective sophistication 3 world. Management research has tended 4222 towards empiricism, paying all too little Implications of the inadequacy of much 5 attention to theory building. management studies research (in terms of 6 The positivist social scientist in the investi- complexity, intricacy and versatility in making 7 gations of social action claims to emulate the knowledge) are serious. First, the misnomer 8 natural scientist, and thus takes the social of ‘methodology’ – simplistic description of 9 world to be a single, observable, factual re- methods employed, that does not engage in 20 ality that can only be known scientifically. the study of method for producing warranted 1 Yet, the natural sciences and ‘cultural sciences’ knowledge, and does not recognize choices 2 do not share, and should not be organized to be justifiably made. Thus, mode of inquiry 3 around, the same beliefs and principles. is not clearly matched to the nature of 4 Immanuel Kant (1781) showed that empiri- the research question and how it is to be 5 cists wrongly assume that the world provides posed. Competing (perhaps incommensurate) 6 meanings to us, whereas it is people who knowledge claims are not dealt with ade- 7 endow the world with meanings. Our minds quately. Such research practice lacks scholarly 8 are not passive receivers of data from our reflection. 9 sensorium. Facts and experiences cannot When researchers unreflectively speak of 30222 speak for themselves. their research methodology, they are (almost 1 Today, critical social psychology (Stanton always) guilty of a misnomer that reveals 2 Rogers et al., 1995, for example) does not their bias and narrow thinking. It is alternative 3 accept that the knowable world can be sen- epistemologies that are at stake. Methodology 4 sibly limited to what can be empirically (or ‘metascience’) is the inquiry that reveals 5 demonstrated through rational inquiry. In the presuppositions, assumptions, beliefs 6 our technological world we are promised and set of methods and practices of an 7 WYSIWYG. The unfortunate result of the ontological-epistemological commitment, as 8 inherent bias in much empirical work is that well as the philosophy of knowledge ‘para- 9 ‘What You Get Is What You See’ (or ‘I’ll see it digm’ within which that approach is located 40 when I believe it’). (Gebhardt, 1978). 1 Concepts are muddled in the unreflective In epistemological reflection we examine 2 practices of ‘knowledge takers’ who assume how it is that we can know that we know. 3222 inscrutable epistemologies, producing far too Discussion of such matters produces increased

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors awareness of what is involved in inquiry so entails a requirement of both managers that we may recognize the virtues and limita- and academics to be self-critical. A critical tions of our claims to knowledge. capacity then is not something which is Empirical and scientific knowledge is but outside and opposed to management – on one form of belief. Positivist ‘research’ practices the contrary, it is the very condition for suppress epistemological issues, and result in management to be able to learn, adapt the making of bold and hegemonic claims to and influence the rapidly changing world knowledge. This is commonplace in manage- conditions of the coming century. ment studies. Empirical study is taken to be (Fulop and Linstead, 1999: 1–2) about things that happen, and even non- empirical claims may have empirical conse- In reflecting on management education, quences. ‘Much of what is considered positiv- I recognize the significance of the anthropo- istic management research may not actually logical notion of a complex ‘web of belief’ represent positivism as it remains under- (drawn on by Quine and Ullian, 1970). The theorized and conceptually lacking, thus per- philosopher Kant wanted to abolish know- haps being better described as naïve empiri- ledge to make way for belief. In mindlessly cism’ (Johnson and Duberley, 2000: 60). pursuing ‘science’, maybe that is largely what Tudor (1982) suggests general criteria for we have achieved! Is too much of our so-called the acceptance of knowledge. For knowledge ‘research’ no more than the ‘discovery’ of evi- to be accepted it is shared by a body of ‘signi- dence to confirm our own beliefs-in-use of the ficant others’ (an epistemic community, moment, or can we really aspire to use some Holzner, 1972) (intersubjective legitimation). rigorous and systematic process to change our The knowledge has to be congruent with beliefs and values for the better? what that epistemic community already knows (coherence with accepted preconcep- ‘Teaching’ methodology for tions). In principle, the truth is publicly communication research demonstrable. Pragmatically, what gives good practical results is considered ‘good’ know- The traditional rationale is to teach research ledge (contribution). Only positivists would methods – sophistication and proficiency in insist on correspondence with the ‘facts’ of using (the right) method is taken to be the ‘reality’. Yet the will to pragmatism can bypass (only) path to warranted knowledge. I won- coherent theoretical foundation. dered how well what happens ‘between people’ could be treated entirely with scien- For us, being critical does not mean stand- tific method. ‘From a purely positivist point of ing outside management and exposing its view man (sic) is the most mysterious and flaws and weaknesses. It entails an active disconcerting of all the objects met with by and passionate commitment to improving science. In fact we may as well admit that managers’ abilities to deal with the prob- science has not yet found a place for him (sic) lems they face, and helping them to dis- in its representations of the universe’ (Teilhard cover how to manage better. This involves de Chardin, 1959: 181). both sustained investigation at the practical Since this comment, the fields upon which level and equally sustained critical activity corporate communication researchers might at the level of theory and analysis; it also draw (cognitive psychology, social psychol-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 ogy, managerial economics, and so on) have By producing a rigorous written critical 2 been further built upon a scientific founda- review on a research study, each member 3 tion. Management researchers have taken of the class will address practically, and rel- 4 for granted that they can ‘stand on the shoul- evantly, the significant issues in planning, 5 ders of giants’ to apply ‘tried and tested’ doing, and writing their own research (as a 6 ways to treat management problems. But, knowledge producer), and in finding, read- 7 perhaps, in general, corporate communica- ing, using, and evaluating others’ research 8 tion researchers are too tied to an instru- (as knowledge taker and user). 9 mental purpose of helping managers to The module tutor will provide a theoret- 10 ‘manage’. Is there sufficient critical reflection ical framework for critical reflection and 1 on what is produced in the name of academic will advise on significant methodological 2 knowledge (as a resource for authoritative issues as the projects progress. 3 management – MBA, etc.) and how such work A distinction is to be drawn between 4222 is conducted? research as ‘fact finding’ (description and 5 I have encouraged masters and doctoral measurement for problem-solving and 6 students to reflect on their presuppositions of developmental activity) and research as the 7 what constitutes research for managerial ‘systematic making of knowing’ (inquiry for 8 purpose, and not merely to seek research understanding and scholarly production). 9 skills. I have reflected on my alternative Assessment will examine the extent to 20 approach to a class on research methods for which the written work is coherent in pre- 1 managing communication. My aim is to pro- senting a rigorous, practically relevant 2 duce greater awareness to allow managerial critique of communication research. 3 researchers to more carefully choose which of 4 the ‘innumerable mutually uncomprehending Following Tudor’s (1982) suggestion, I wish 5 groups talking to themselves in esoteric to promote a simple framework for a know- 6 jargon’ (Wheatcroft, 2002: 63) they prefer to ledge creation interaction process that empha- 7 engage with and be a part. sizes the interactive nature of enquiry and 8 The statement of the class rationale follows, recognizes that a knower always knows what 9 to illustrate. is known in a particular human and natural 30222 context. 1 Research as coming to know 2 Part-time MSc./MBA programme 3 • Experience a significant and/or problem- Communication research methodology 4 atic aspect of the world. 5 The aim of this module of study is to under- • Interpret through applied preconceptions 6 stand and challenge orthodox managerial derived from earlier experiences, inter- 7 theories-in-use in conducting research on ests, already accepted knowledge, social 8 managing human communication. This situation and so on. 9 will be accomplished by drawing on criti- • Relate interpretations to other experiences 40 cal social psychology as the basis of a and interpretations derived from signifi- 1 scholarly critique of the hypothetico- cant others. 2 deductive science tradition in communica- • Intersubjectively establish ‘true’ know- 3222 tion research. ledge.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors • In making sense of the world, use to of corporate communication research (and explain further experiences. related, including corporate reputation, brand management, public relations, and so on) is empirical but not properly interpretative, and So what? certainly not critical. So to return to my central question. Do researchers of corporate com- Where does corporate communication re- munication wish to pursue no more than a search lie? Is it part of management studies (in managerialistic endeavour, in which com- the United Kingdom) or a specialist-applied munication is merely an ‘instrument’ or ‘tech- branch of communication studies (in the nology’ to be used for commercial ends, or do United States)? How coherent is the field in some at least have the courage to challenge drawing upon psychology and sociology (and the orthodoxy as constructive mavericks? other epistemic communities)? What form Perhaps the extent to which membership of of bounded social science provides our disci- epistemic communities is recognized as limit- plinary matrix? It would seem sensible to ing is what distinguishes scholars from techni- suggest that the several epistemic commun- cian-scientists? Some make intellectual tools, ities address aspects of the phenomenal world whilst others strive only to proficiently use at various levels of abstraction. This presents them. There needs to be more aspiration to an expectation of shared discourse as well the former, as well as more care in using such as direct conflict. It is in the confrontations tools in making claims to warranted know- that creative insight and advancement is ledge. possible. Unfortunately, still far too much so-called Carey (1975) defines communication as ‘a research is conducted by earnest reductionist- symbolic process whereby reality is produced, specialist technicians in the Department of maintained, repaired, and transformed’. How Detailed Quantification of Not Very Important well does our research treat this rich picture of Problems (Faculty of Traditional Hegemonic what happens between people? Scientism). Where from will much needed The scholar is intellectually responsible creative insights stem? Corporate communica- (Kennedy, 1997) in self-consciously reflecting tors must become creative generalist integra- on methodology. We must neither disable tors. Naive empiricism in the pursuit of power ourselves, with methodological meanderings, and the treatment of politics as no more than from pursuing our academic duty to apply our a variable to be accounted for in some critical intelligence in original exploration for machine model of ‘organizations’ is unsatis- scholarly production, nor resign ourselves to factory. methodological disinterest or ignorance. Bernstein (1976) argues that an adequate, Sciences may be learned by rote, but comprehensive political and social theory Wisdom not. must be empirical, interpretative and critical. (Laurence Sterne, 1713–1768, Almost all of what is published in the field Tristram Shandy)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 NOTES 2 3 1 Deetz (1992) defines managerialism as ‘a kind of of representation’, and ‘It is a way of doing and 4 logic, a set of routine practices, and an ideology’. being in corporations that partially structures 5 He specifies that it is ‘a way of conceptualising, small groups and conflicts with, and at times sup- 6 reasoning through, and discussing events’ (a dis- presses, each group’s other modes of thinking.’ 7 cursive genre) and it involves ‘a set of routine 2 There is an irony here – David Bohm was one of practices, a real structure of rewards, and a code the greatest physicists of the twentieth century. 8 9 10 REFERENCES 1 2 Alvesson, M. and Willmott, H. (eds) (1992) Critical Holzner, B. (1972) Reality Construction in Society, 3 Management Studies, London: Sage Publications. Cambridge, MA: Schenkman. 4222 Alvesson, M. and Willmott, H. (1996) Making Sense of Hosking, D.-M. (1995) ‘Constructing power: entita- 5 Management: A Critical Introduction, London: Sage tive and relational approaches’, in D.-M. 6 Publications. Hosking, H. P. Dachler, and K. J. Gergen (eds), Management and Organization: Relational Alterna- 7 Anderson, J. A. (1996) Communication Theory: Epistemological Foundations, New York: Guilford tives to Individualism, Aldershot: Avebury Books, 8 Press. pp. 51–70. 9 Bernstein, R. J. (1976) The Restructuring of Social and Johnson, P. and Duberley, J. (2000) Understanding 20 Political Theory, Oxford: Basil Blackwell. Management Research: An Introduction to 1 Bohm, D. (1996) On Dialogue, ed. L. Nichol, London: Epistemology, London: Sage Publications. Routledge. Kant, I. (1781;1934) The Critique of Pure Reason, tr. J. 2 M. D. Meiklejohn, London: Dent. Carey, J. (1975) ‘A cultural approach to communica- 3 Kennedy, D. (1997) Academic Duty, London: Harvard tion’, Communication, 2(2), 1–22. 4 University Press. Deetz, S. A. (1992) Democracy in an Age of Corporate Quine, W. V. and Ullian, J. S. (1970) The Web of Belief, 5 Colonization: Developments in Communication and New York: Random House. 6 the Politics of Everyday Life, Albany, NY: State 7 Stanton Rogers, R., Stenner, P., Gleeson, K. and University of New York Press. Stainton Rogers, W. (1995) Social Psychology: 8 Deetz, S. A. (1995) Transforming Communication, A Critical Agenda, Oxford: Polity Press. 9 Transforming Business: Building Responsive and Teilhard de Chardin, P. (1959) The Phenomenon of 30222 Responsible Workplaces, Creskill, NJ: Hampton Man, New York: Harper & Brothers. 1 Press Inc. Tudor, A. (1982) Beyond Empiricism: Philosophy of Fulop, L. and Linstead, S. (1999) Management: A 2 Science in Sociology, London: Routledge & Kegan Critical Text, London: Macmillan Business Books. Paul. 3 Gebhardt, E. (1978) ‘A critique of methodology’, in Wheatcroft, G. (2002) ‘Two cultures at forty’, 4 A. Arato and E. Gebhardt (eds), The Essential Prospect, May, 62–4. 5 Frankfurt School Reader, New York: Basil Wilber, K. (1996) A Brief History of Everything, Boston, 6 Blackwell, pp. 371–406. MA: Shambhala Publications. 7 8 9 40 1 2 3222

Glenda Jacobs

It is widely recognized that organizational growth and even survival in a changing business environment relies directly on the creative ability to question, adjust and at times re-invent accepted processes, services and products. This chapter argues that, given the demands of today’s business environment, both the ability to think creatively, and a rigorous understanding of how creative thinking should be managed and developed in organizational environments, are for corporate communication managers not only useful talents, but also professional responsibilities. The chapter seeks to demonstrate how a clearer understanding of the close relationship between corporate creativity and corporate communication allows organizations to more effectively manage creative opportunities, as well as to integrate creative thinking processes into existing corporate structures.

The need for creative thinking in American Management Association, Arthur D. organizations Little, Fortune 500, Digital Strategies and the Centre for Research in Employment and It is only during the second half of the twenti- Technology in Europe) consistently reveal that eth century that ‘creativity’ as a concept both SMEs (small and medium-sized enter- ceased to be perceived as the province of prises) and leading multinational companies the eccentric, the gifted and the artistic, and recognize creativity to be an essential priority has gained legitimacy in the realms of aca- for survival in the twenty-first century. demic research and effective business practice Consequently, the period since the 1960s (Drucker, 1985; Ford and Gioia, 1995; has seen an escalation of investigation into Getzels, 1987; Isaksen, 1987; Sternberg, how best to encourage, develop and manage 1999; Wehner et al., 1991). In addition, inter- creativity and innovation in organizational national surveys (by, among many others, the settings.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 The relationship between successful production of ‘new and relevant’ 2 communication and corporate (Amabile, 1983; MacKinnon, 1978; Stein, 3 creativity 1984) ideas and products, as well as the 4 mental processes that underpin and con- 5 While definitions of creativity vary, underpin- tribute towards that production. 6 ning both past and current research is the 7 recognition that communication is central to 8 it. In fact, in his seminal paper categorizing Corporate language choices and 9 types of creativity in 1961, Mel Rhodes goes creative thinking 10 as far as to define the term as ‘the phenom- 1 enon in which a person communicates a new At its most simple level, effective incorpora- 2 concept’ (p. 216; my italics). Implicitly and tion and management of creative thinking in 3 explicitly, communication is consistently iden- organizations is fundamentally influenced 4222 tified as both a creativity-relevant process, by the language used to identify it. Even the 5 and a domain-relevant skill (Amabile, 1983), most commonly used terms ‘creativity’ and 6 since it is essential as a means not only of ‘innovation’ both carry connotations that 7 creating, facilitating and managing creative can either inhibit or enhance what people 8 environments, processes and outcomes, but perceive as the kind of activities and thinking 9 also of acquiring the knowledge on which they would embrace, and this in turn affects 20 corporate creativity and innovation need how valuable they seem to corporate goals. 1 to be based (Collins and Amabile, 1999; For example, the term ‘creativity’ is preferred 2 Csikszentmihalyi, 1990; Hallman, 1963; by psychological theorists who have in the 3 Locke and Kirkpatrick, 1995). past dominated the field of creativity research 4 It is therefore not surprising that studies of (Lehrdahl, 2001). However, the term is also 5 business creativity invariably also provide often perceived as carrying with it broader 6 unique insights into principles of organiza- suggestions of liberal arts, design, subjectivity, 7 tional communication – for example, those eccentricity and even dishonesty, which may 8 underlying employee motivation, evaluation influence and limit its perceived acceptability 9 and feedback; collaboration and networking; in many corporate environments. 30222 communication of corporate vision, values By way of contrast, business discourse tends 1 and climate, as well as problem solving, to prefer the more outcome-oriented term 2 change management, negotiation and persua- ‘innovation’, which, even when it is used 3 sion (see for example Collins and Amabile, interchangeably with the term ‘creativity’ 4 1999; Gryskiewicz, 2000; Kanter, 1988; (Amabile, 1983; Andriopolos and Lowe, 5 Sternberg and Lubart 1999; Treffinger, 1987). 2000; De Bono, 1989; Peters, 1991), implies 6 This chapter will show that recognizing, practicality, strategy and a shift in focus to 7 examining and mapping out these areas of successful outcomes such as ‘new products, 8 influence will allow organizations more effec- new services, and new businesses’ (Jonash 9 tively to harness and manage creative oppor- and Somerlatte, 1999: 6; Wehner et al., 40 tunities, as well as integrate creative thinking 1991). However, the problem arises that, 1 processes into existing corporate systems and while avoiding the possibly vague and un- 2 structures. The term ‘creative thinking’ will be businesslike connotations of the term ‘creativ- 3222 used in this chapter to encompass both the ity’, a discourse emphasizing innovation

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors simultaneously de-emphasizes the value of valid, possible and likely. By way of contrast, the early preparation, incubation and pro- the distinguishing purpose of creative thinking vocative thinking stages on which creative out- is to escape the confines of conventionally comes are based. Consequently, in corporate accepted logical and rational trains of thought. environments, which tend to be outcomes- This requires openness to ideas that are seem- based by default, it would be easy unwittingly ingly irrational, illogical, impractical, invalid, to downplay or overlook the degree to which impossible and unlikely – even bizarre – in the creative thinking process contributes in its order to explore their potential and exploit own right to ongoing corporate growth and their generative power. Practically speaking, learning – whether or not specifically identifi- this means that language and vocabulary able outcomes result. choices that reflect and promote suspension of One may argue that this caution places evaluative logic, resistance to closure and too much weight on a simple vocabulary pref- openness to generative exploration have to erence, yet the tendency to emphasize out- become part of what is accepted and valued as comes at the expense of process can clearly ‘normal’ in everyday verbal exchanges. Initial be observed in studies where ‘innovation’ is evidence of where this has begun to occur can deliberately defined as referring only to the be found in expressions such as ‘blue sky’, practical implementation – ‘the successful ‘black hat’ and even ‘brainstorm’, which have exploitation’ (Tidd et al., 1997: 25) – of already become part of organizational linguis- creative ideas, as opposed to either the tic repertoires. method of producing the ideas or even the Of course, the value of traditional forms ideas themselves (Isaksen, 1987; Lampikoski of logic and critical reasoning to corporate and Emden, 1996). decision making, planning and management A primary challenge, for communication is not under dispute. Nevertheless, in any managers then, would be to find a method of organization wishing to learn from and co- naming or labelling the notion of creative ordinate both creative as well as logical/ thinking in a way that that is both unambigu- evaluative thinking styles and systems, it ous and free of negative connotations in the remains important to recognize how easily corporate environment. In addition, caution seemingly sensible comments such as ‘That’s would be necessary when interpreting and not practical’ and ‘Let’s be reasonable’ will attempting to apply the results of studies and (often unintentionally) shut down creative reports on organizational innovation, since it thinking opportunities. would first be important to take into account the sense – inclusive or exclusive – in which the term is being used. Organizational culture and A second communication challenge is that creative thinking of legitimizing and incorporating into corporate discourse the types of verbal interaction In order to survive, organizations must strike a that support and encourage creative thinking balance between order and change. On the processes. For example, corporate discourse one hand they can only function effectively if tends to place considerable value on vocabu- members perform their roles consistently, lary reflecting deductive and inductive logic, carry out routine tasks and maintain ordered and emphasizing what is rational, practical, systems. On the other hand, they need to

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 remain open and flexible enough to respond This would require: 2 to and pre-empt the shifting demands of their 3 changing business environment. • communicating to all employees – not 4 The role of communication in managing just executives and managers – their 5 the tension between these two goals is high- responsibility to examine, reflect upon, 6 lighted when approached from the relational challenge and suggest alternatives to 7 perspective of Carl Weick (1979), who pro- accepted organizational attitudes and 8 poses that organizations are essentially the practices. To this end, communication of 9 products of communication interactions. corporate vision and values that depend 10 Organizations, according to this viewpoint, on these activities, as well as feedback 1 are created out of the communication actions and reward systems that reinforce them, 2 and interpretations of the individuals that would be pivotal; 3 comprise them. Organizational learning guru • facilitating corporate systems that can 4222 Peter Senge expands on this relationship accommodate ambiguity and that encour- 5 when he defines a learning organization as age (or at least do not inhibit) exploration 6 one where people are continually discovering of new and extemporaneous ideas at both 7 how they create their reality, where they con- individual and group level. This would tinually expand their capacity to create the 8 require communication management that results they truly desire, and where new and 9 supports a transition from ‘command and 20 expansive patterns of thinking are nurtured control’ to ‘freedom with responsibility’ 1 (1990). models of leadership; 2 Approached from this perspective, one • providing a variety of communication 3 of the most significant responsibilities of a channels for expressing individual ideas, 4 communication professional would be the managing diverse viewpoints and for con- 5 maintenance of a communication culture fronting existing – however successful – 6 that encourages the discovery, examination 7 and questioning of existing thinking patterns, routines, practices and products. Recent 8 and that allows and supports the airing and advances in communication technology 9 consideration of new and unconventional both considerably increase opportunities 30222 ones. in this regard, and add to their complexity; 1 A primary characteristic of such a com- • ensuring that all members of the organ- 2 munication culture would be its capacity to ization both understand and develop the 3 accommodate conflict, since new ideas by interpersonal skills necessary for open dis- 4 their very nature will suggest change that cussion, disclosure and negotiation. This 5 could call into question existing (and valid) would include training employees in 6 ways of doing things. Conflict in a corporation interaction styles as well as in creative 7 that values creative thinking would need to be thinking approaches and strategies. 8 generally recognized as an opportunity for 9 clarification, learning and improvement, 40 rather than as a negative phenomenon to be Vision, values and leadership 1 avoided in the interest of maintaining the 2 status quo and of encouraging superficially The focus of creative effort, if it occurs at all 3222 ‘positive’ employee morale. within an organization, will be determined

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors by what the organization values and how be reinforced by congruent control structures, commitment to those values is communicated operating procedures, reward systems and to the workforce. This creates a significant resources. For example, the most creative of leadership responsibility to make sure that, as corporate visions will be undermined and Jones (1995: 199) points out, the elements of nullified by authoritarian leadership, bureau- corporate ‘winning behaviour’ are unambigu- cratic procedures, reward systems that encour- ously defined, and that creative thinking is age maintenance of the status quo and seen to be one of those elements. short-term, bottom-line outcomes, and lack of A corporate vision that depends on and practical resources such as money and time. articulates the need for creative effort from all Conversely, the identification and defini- members of the workforce would be an essen- tion of creative thinking as ‘winning behav- tial starting point. Moreover, the vision would iour’ would be communicated by corporate need to be one with which the workforce is leaders through, for example: able to identify, which they own, and which they feel instrumental in constantly reinforc- • modelling creative thinking techniques in ing and recreating. Instilling this sense of their everyday management routines empowerment requires understanding of the (such as during meetings); link between information and creative effort. • providing examples and stories that re- When employees are kept informed they inforce creative values; are more likely to feel trusted and respected, • replacing hierarchical and rules-orien- and this in itself encourages the self-confi- tated control structures with flatter and dence necessary for risking the exposure of more flexible ones that emphasize indi- new ideas. Furthermore, the more informed vidual initiative as well as freedom to all employees are about organizational func- determine how objectives are met; tions, processes and systems, the greater their • developing problem-solving procedures sense of ownership is likely to be and the that make it possible to resist the organ- better equipped they will be to engage imag- izational survival instinct towards immedi- inatively with and participate in the pursuit ate solutions, and to tolerate ambiguity and (where necessary) reinvention of corpor- while pieces fall into place or links emerge ate goals and aspirations. Indeed, merely pro- from unexpected sources; viding information about where creative • providing feedback that reinforces and thinking is needed would improve the likeli- further stimulates creative thinking initia- hood of it occurring. Lastly, from a purely tives. The part played by feedback and practical perspective, the creative ability to reward in communicating the value of make associations, apply unusual perspectives creative thinking to a corporate workforce and synthesize knowledge would naturally is much debated, not least because stud- increase relative to the breadth and depth of ies have suggested that external rewards employees’ information base. which motivate employees to be more In addition to promoting and requiring the productive may under certain circum- informed participation and initiative of all stances negatively influence creative members of the organization, a corporate performance. These issues are discussed in vision that values creative thinking needs to more detail in the following section.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Influence of feedback and reward engaging with the challenge of a task, from 2 on creative thinking the strong internal desire to do something 3 based on interests and passions, and from the 4 Inevitably, much of the feedback given in internal satisfaction when that challenge is 5 corporate environments tends to be negative met. Follow-up studies further support the 6 in tone – identifying weaknesses and enforc- value of intrinsic motivation by indicating 7 ing accepted standards where they seem to that, where external constraints exist, empha- 8 have been overlooked. However, repeated sizing internal motivational factors can make 9 negative feedback inhibits creative thinking individuals more resistant to their negative 10 by placing recipients on the defensive and dis- effects (Amabile and Gryskeiewicz, 1989; 1 couraging them from suggesting or undertak- Amabile, et al.,1994). Naturally, however, 2 ing tasks that challenge accepted ways of where external factors actually serve to 3 doing things and make them vulnerable to build up internal motivation – clear goals, 4222 further criticism. for example, and recognition/rewards 5 On the other hand, withholding negative that build confidence – they too serve to 6 feedback where it threatens accepted norms heighten creative thinking capacity and 7 or corporate attitudes – often in the guise performance. In order to encourage and stimulate 8 of ‘not rocking the boat’ and ‘maintaining a 9 creative thinking, therefore, feedback within positive attitude’ – also promotes uncritical 20 corporate contexts would need to concen- conformity and perpetuates unthinking 1 trate on: adherence to the status quo. 2 Even positive feedback can discourage 3 • providing opportunities for employees to creative endeavour if, for example, it meas- 4 experiment and take risks, with failure ures successful performance against the 5 treated as a learning opportunity and performance of others (Amabile, 1983; 6 generating opportunities for improving 7 De Bono, 1989). This could act as a powerful ability; 8 disincentive to ambitious individuals with a • increasing employees’ intrinsic motivation 9 record of past success because engaging in by emphasizing the value of their work, 30222 creative initiatives and untried processes and making the work process rewarding in 1 could place their reputations at risk should itself; 2 they not succeed. Likewise, if positive feed- • increasing employees’ confidence, raising 3 back emphasizes and is focused exclusively their consciousness of their value and of 4 on successful outcomes, employees will be their ability to make a difference; 5 disinclined to engage in creative thinking • encouraging further feedback, with ques- 6 activities that by their very nature may tions and responses that elicit informa- 7 produce uncertain or unpredictable results. tion about motives, reasons, underlying 8 Furthermore, extrinsic rewards used as pos- assumptions and that reinforce awareness 9 itive feedback can also discourage creative of the genuine value placed on reflection; 40 productivity, according to Teresa Amabile’s • encouraging and respecting minority 1 intrinsic motivation hypothesis (1983). She views, since these spark questioning 2 argues that the motivation to be creative and encourage further independent 3222 comes from the enjoyment to be gained from thinking.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Opportunities for providing a variety of chan- dimensional mental modelling, which allows nels that allow feedback to be given and users to share and reflect upon visual repre- received in the most accessible, convenient sentations of their thinking patterns and and appropriate form have been considerably approaches. An additional advantage is that enhanced by the development and adoption these applications can instantaneously inte- of new communication technologies. These grate and display input from a variety of are discussed in the following section. sources, further transcending limitations of paper-based – and even whiteboard-based – methods. Communication technology and Of course, one of the most obvious advan- creative thinking tages afforded by communication technology is its potential to allow collaboration between For many years it was assumed that using teams comprising widely dispersed mem- computers as a communication medium bers, unlimited by organizational, geographic would foster impersonal, even aggressive, or even time constraints. These networks task-oriented behaviours of a kind that would also provide opportunities for individuals to discourage creative thinking. However, early participate in multiple teams and projects, research was frequently conducted using zero- increasing the likelihood of creative cross- history, inexperienced participants engaged in fertilization of ideas. short, inauthentic tasks under laboratory con- Recent studies involving computer-me- ditions. Subsequent studies reveal that com- diated decision-making groups whose sole puter-mediated communication produces contact is online, however, suggest that if both social and task effects that contradict group salience is high (in other words, if the early findings completely (Baym, 2002; Lea members of the group regard their group and Spears, 1991; Walther, 1997; Lea et al., identity as of primary significance to them), 2001; Scott, 1999), and demonstrate that group members tend to demonstrate greater communication technology can be highly normative behaviour and are more likely to supportive of – and indeed in several ways conform than when members’ individual enhance – group communication and colla- identities are salient (Lea et al., 2001). This boration. would have implications for leaders of virtual For example, electronic brainstorming has groups, who may at times want to hold been repeatedly demonstrated to outper- off tendencies toward consensus in the inter- form the face-to-face kind in large groups, est of provoking a wide range of contrasting owing to the absence of production blocking perspectives. In such cases, deliberately and also to reduced social loafing. Larger highlighting members’ consciousness of their electronic brainstorming groups have further individuality – while naturally still encour- been found to generate more high-quality aging supportive, social and co-operative ideas than their non-electronic counter- behaviours – would be an important strategy. parts (Gallupe et al., 1992; Dennis, 1994; It is to be remembered, however, that Briggs, 1995; Valacich et al., 1994). Other these findings apply only to groups whose specialist group-oriented computer-mediated sole contact is online, and short term. tools that enhance creative thinking include As Walther (1997) points out, there comes software for mind-mapping and three- a time in all extended-term groups

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 when members start sharing personal inform- ﬁgures in creativity research agree that collab- 2 ation, and group salience is eroded. For the orative and team processes are essential to 3 majority of corporate users, though, the ongoing and consistent practice of creative 4 online medium would be one of many chan- thinking by the workforce as a whole. On 5 nels used for communication between partici- the one hand, teams are necessary for pur- 6 pants, so individual identities would remain suing and developing radical individual 7 salient and participants’ tendency to conform creative initiatives, and on the other hand 8 or disagree would be as unaffected as if they they are vehicles for the ‘incremental’ creative 9 were face to face. thinking necessary for corporate success, 10 Technology that could facilitate creative particularly in organizations with complex, 1 thinking is not limited to groupware and the changing business environments (Amabile 2 internet, however. For example, visualization, and Gryskeiewicz, 1989; Csiksezentmihalyi 3 an important ingredient of the creative and Sawyer, 1995; Hunt, 2002; Lehrdahl, 4222 process, is enhanced by the advent of inter- 2001; Qvale, 1995). 5 active 3-D virtual image displays, webcams Consequently, communication manage- 6 and increasingly high-resolution ﬂat panel dis- ment strategies intended to encourage 7 plays. Furthermore, increasingly sophisticated creative thinking would need to concentrate 8 computerized knowledge management sys- on fostering, maintaining and developing 9 tems nowadays provide employees with easy collaborative problem solving, teambuilding 20 access to resources and information that add and networking opportunities within – and 1 to their capacity and increase their inclination outside – the organization. Interestingly, 2 to engage in creative thinking. In fact, com- extensive studies demonstrate that while 3 munication technology overall provides vitally win–lose competition has a negative effect on 4 increased capacity for the immediate capture individual creative performance, competitive 5 6 and subsequent sharing of information and pressure can enhance creative thinking within 7 ideas, whether synchronously or asynchron- teams when that pressure is perceived as 8 ously, anonymously or allowing for personal meaningful rather than arbitrary (Amabile, 9 recognition. 1996). The reason for this seems to lie in the 30222 In all these ways, far from being cold and energized, cohesive climate created within a 1 impersonal inhibitors of imagination, com- team in the face of a meaningful challenge, 2 munication technologies provide systems and without the stresses associated with individual 3 channels for organizations and their members evaluation. In other words, a sense of compe- 4 to use their creative potential more fully, by tition in a collaborative team environment 5 allowing them to rise above the constraints of could work to the creative advantage of an 6 bureaucracy, geography, memory and time. organization, and need not be assumed auto- 7 matically to discount the possibility of accom- 8 modating creative processes within corporate 9 Collaboration and creative contexts per se. 40 thinking Once again, the importance of communi- 1 cating a culture of ‘belonging’ is clear. How- 2 While radical creativity may at times depend ever, while constant open communication 3222 on the initiative of an individual, leading within and between segments of an

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors integrated organization is recognized as a Training needs basic requirement of creative production (Kanter, 1988; Gioia, 1995), the additional Critical and analytical thinking techniques importance of networking outside immediate are routinely taught and evaluated as part corporate confines is often overlooked. of undergraduate degrees in business and Studies in communication networking point- management, and rightly so. However, des- edly indicate that links with colleagues and pite the wide recognition of the value of acquaintances outside employees’ normal creative thinking in modern business environ- professional circles have the effect of broaden- ments, prospective managers and aspirant ing their knowledge base, as well as exposing executives are expected to pick up the tech- them to new ideas and different perspectives niques and approaches intuitively, or, if they (Garton et al.,1997; Haythornthwaite, 2001; are lucky, to have a creative instinct or talent Harasim et al.,1995; Pickering and King, that they are never formally required to 1999). As such, these ‘weak ties’ are import- harness, account for, or constructively com- ant sources of divergent and non-redundant municate to others. information on which creative thinking Thus the need for relevant education in thrives. Exposing employees to these connec- creative thinking skills and management tions could be facilitated by setting in place remains unmet. Although there has been a proliferation of corporate training courses opportunities for cross-functional workshops, claiming to improve employee creativity in inter-organizational team projects and (using the workplace, the value of such programmes increasingly advanced groupware and other is open to question on the grounds that the digital communication channels) project- full spectrum of organizational needs is rarely based virtual collaboration between dispersed catered for, while application of principles of – and probably transient – work groups. At a creative thinking research and theory seem more basic level, though, they are encouraged perfunctory at best. and maintained by such simple measures as For example, corporate training pro- the provision of swift and immediate net- grammes to improve employees’ creative abil- working channels such as email, as well as ities tend to be of short duration (typically, access to specialist discussion groups on the a half to two days), and most frequently focus worldwide web. on identifying creative thinking barriers, prac- For the beneﬁts of collaborative environ- tising uninhibited idea generation such as ment to be fully realized, however, opportuni- brainstorming, and/or doing exercises to ties for both executive and workforce training activate various sections of the brain. Some in group leadership and participation (both controversy surrounds the effectiveness – and onsite and particularly virtual) would need even the validity – of some of these tech- to be provided. These and other professional niques (Epstein, 1996; Efron, 1990; Weisberg, development requirements necessary to 1993). More important, however, is that such underpin and promote creative thinking in courses seldom if ever provide either follow- corporate contexts are identiﬁed in the follow- up on the subsequent progress of course ing section. attendees, or ongoing maintenance or monitoring of how (or indeed whether) the new processes are integrated into the workplace.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Research also shows that, while some forms communication principles and processes cen- 2 of training can indeed have some positive tral to inspiring, developing and managing 3 effect on attitudes toward using creative think- not only the techniques but also the attitudes 4 ing techniques (Basadur et al.,1990; Hall and and tensions resulting from introducing 5 Lin, 1984; Hipple, 2001), significant know- creative thinking behaviours into necessarily 6 ledge transfer from such brief exposure is structured and bottom-line oriented organiza- 7 unlikely (Rickards, 1993; Weisberg, 1993). tional frameworks. 8 Nevertheless there is some value to be The role of language and its influence on 9 gained from exposure to training in creative the perceived value of creative activity was 10 thinking approaches, if it identified and discussed, as was the import- 1 ance of a clearly communicated corporate 2 • increases employees’ openness to experi- vision, supported by an organizational culture 3 menting with a wider range of thinking that encourages and values experimenta- 4222 approaches; tion, discovery and the challenging of estab- 5 • increases employees’ belief in their ability lished norms. Furthermore, it was proposed 6 to think creatively; and that while corporate leaders play a critical 7 • provides teams with a common vocabu- role in modelling, managing and construc- 8 lary and system for either identifying tively acknowledging and rewarding cre- 9 creative thinking opportunities or identi- ative behaviour, it nevertheless remains of 20 fying occasions where creative thinking is primary importance that all members of the 1 being obstructed. corporate workforce feel able and motivated 2 to recognize, seize, and act upon creative Equally or more important, however, would 3 opportunities when they arise. This sense be training in the skills that make creative 4 of empowerment and ownership would be thinking possible and practically manageable 5 enhanced by the establishment of communi- within the stresses and complexities of corpor- 6 cation channels that cut across traditional ate environments. As this chapter has argued, 7 organizational hierarchies, and that create these skills would encompass: 8 means for intra- and inter-organizational net- 9 • group collaboration and negotiation; working, collaboration and information 30222 • conflict management; sharing. Finally, existing forms of corporate 1 • virtual team participation and leadership; ‘creativity’ training were discussed, and sug- 2 • software and technology for information gestions made as to how this could be 3 sharing, collaboration and networking. improved by incorporation of communication 4 skills, approaches and principles. 5 Overall, this chapter demonstrates that a 6 Summary clearer understanding of the close relationship 7 between corporate creativity and corporate 8 In this chapter we set out to examine the communication would allow organizations 9 importance of creative thinking in corporate more effectively to harness and manage 40 contexts, and the extent to which it is depen- creative opportunities, as well as integrate 1 dent on effective and insightful corporate creative thinking processes into existing 2 communication policies, systems and strat- corporate systems and structures. 3222 egies. In order to do this, we identified the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Activities 2 Investigate and evaluate creativity training programmes in your city/region, using 1 Select three established writers of corpor- the criteria in this chapter as a guide, and ate ‘self-help’ texts on creative thinking adding to them where appropriate. (several appear in the reference and bibli- 3 Download a demo version of any exam- ography sections below). Compare and ple of popular communication groupware evaluate their contributions to the avail- (e.g. MeetingWorks, LotusNotes) and able pool of ‘language and vocabulary assess its capacity for enhancing or choices that reﬂect and promote suspen- inhibiting corporate creativity. sion of evaluative logic, resistance to 4 Write a critical analysis of the contents of closure, and openness to generative this chapter, using your own company exploration’. (or a client) as a case study.

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Gallupe, R. B., Dennis, A. R., Cooper, W. H., Valacich, Kanter, R. (1988) Change-master skills: what it takes 2 J. S., Bastianutti, L. M. and Nunamaker, J. F. Jr. to be creative’, in R. L. Kuhn (ed.), Handbook for 3 (1992) ‘Electronic brainstorming and group size’, Creative and Innovative Managers, New York: Academy of Management Journal, 35(2), 350–69. McGraw-Hill, pp. 91–9. 4 Garton, L, Haythornthwaite, C. and Wellman, B. Lampikoski, K. and Emden, J. (1996) Igniting Inno- 5 (1997) ‘Studying online social networks’, Journal vation, Chichester: John Wiley and Sons. 6 of Computer-Mediated Communication, 3(1). Lea, M. and Spears, R. (1991) ‘Computer-mediated 7 www.ascusc.org/jcmc/vol3/issue1/garton.html communication, deindividuation and group 8 Getzels, J. W. (1987) ‘Creativity, intelligence and prob- decision-making’, International Journal of Man- lem finding’, in S. Isaksen (ed.), Frontiers of 9 Machine Studies, 34, 283–301. Creativity Research, New York: Bearly, pp. Lea, M., Spears, R. and De Groot, R. (2001) ‘Knowing 10 88–102. me, knowing you: anonymity effects of social 1 Gioia, D. (1995) ‘Contrasts and convergences in identity processes within groups’, Personality and 2 creativity’, in C. M. Ford and D. A. Gioia (eds), Social Psychology Bulletin, 27, 526–37. 3 Creative Action in Organisations, Thousand Oaks Lehrdahl, E. (2001) ‘Staging for creative collaboration CA: Sage, pp. 317–29. in design teams’, Doctoral thesis, Trondheim. 4222 Gryskiewicz, S. (2000) ‘Cashing in on creativity at 5 Locke, E. and Kirkpatrick, S. A. (1995) ‘Promoting work’, Psychology Today, September, 63–6. creativity in organizations’, in M. Ford and D. A. 6 Hall, R. and Lin, H. (1984) ‘A meta-analysis of long- Gioia (eds), Creative Action in Organisations, 7 term creativity training programmes’, Journal of Thousand Oaks, CA: Sage, pp. 115–20. Creative Behaviour, 18, 11–22. 8 MacKinnon, D. W. (1978) In search of Human Hallman, R. (1963) ‘The necessary and sufﬁcient con- 9 Effectiveness: Identifying and Developing Creativity, ditions of creativity’, in G. S. Nielson (ed.), Pro- Berkeley: Creative Education Foundation Ltd. 20 ceedings of the SIV International Congress of Applied Peters, T. (1991) ‘Get innovative or get dead’, 1 Psychology, 2, 11–39. California Management Review, 33(1), 9–23. Harasim, L., Hiltz, S., Teles, L. and Turoff, M. (1995) 2 Pickering, J. and King, J. (1999) ‘Hardwiring weak Learning Networks, Cambridge, MA: MIT Press. 3 ties’, in G. Desanctis (ed.), Journal of Computer- Haythornthwaite, C. (2001) ‘A social network theory 4 Mediated Communication, 33(2), 214–21. of tie strength and media use’, Proceedings of the Qvale, T. (1995) ‘Organising for innovation: from 5 Hawai’i International Conference on Sys- 6 tem Sciences, 3–6 January, Maui, Hawaii. individual creativity to learning networks’, in 7 http://alexia.lis.uiuc.edu/~haythorn/HICSS01_ M. Ford and D. A. Gioia (eds), Creative Action in Organisations, Thousand Oaks, CA: Sage. 8 tiestrength.html (September 2002) Rhodes, M. (1961) ‘An analysis of creativity’, in 9 Hipple, J. (2001) ‘The Future of Corporate Innovation Centers, Processes and Champions’, http://www. S. Isaksen (ed.), Frontiers of Creativity Research, 30222 innovation-triz.com/papers/corporate.html (May New York: Bearly Ltd., pp. 216–22. 1 2002) Rickards, T. (1993) ‘Creativity from a business school 2 Hunt, J. (2002) Interview, Innovation update, June, perspective: past, present and future’, in Scott 3 http://iexchange.london.edu/html/int_j_hunt. Isaksen, Mary Murdock, Roger Firestien and 4 html (July 2002) Don Trefﬁnger (eds), Nurturing and Developing Creativity: The Emergence of a Discipline, 5 Isaksen, S. (1987) Frontiers of Creativity Research, New York: Bearly Ltd. Norwood, NJ: Ablex Publishing Corporation. 6 Johnson, C. and Hackman, M. (1995) Creative Robinson, A. and Stern, S. (1997) Corporate Creativity: 7 Communication: Principles and Applications, Long How Innovation and Improvement Actually Happen, 8 Grove, IL: Waveland Press. San Fransisco: Berrett-Koehler Inc. 9 Jonash, R. and Somerlatte, T. (1999) The Innovation Senge, P. (1990) The Fifth Discipline, New York: 40 Premium, New York: Perseus. Doubleday. Jones, F. B. (1995) ‘The changing face of creativity’, in Scott, C. (1999) ‘Communication technology and 1 M. Ford and D. A. Gioia (eds), Creative Action group communication’, in L. Frey (ed.), Group 2 in Organisations, Thousand Oaks, CA: Sage, Communication Theory and Research, Thousand 3222 pp. 195–200. Oaks, CA: Sage, pp. 432–72.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Shepherd, M., Briggs, R., Reinig, B. and Yen, J. (1994) Valacich, J. S., Dennis, A. R. and Connolly, T. (1994) ‘Social loaﬁng in electronic brainstorming: in- ‘Idea generation in computer based groups: a voking social comparison through technology new ending to an old story’, Organisational Beha- and facilitation techniques to improve group pro- vior and Human Decision Processes, 57(3), 448–67. ductivity’, Journal of Management Information Van Gundy, A. B. (1986) ‘Organisational creativity Systems, 12(3), 155–70. and innovation’, Creativity and Innovation Net- Stein, M. L. (1984) ‘Creative: the adjective’, Creativity work, 16, 201–18. and Innovation Network, 10, pp. 115–117. Walther, J. (1997) ‘Group and interpersonal effects Sternberg, R. J. (1999) Handbook of Creativity, in international computer-mediated collabora- Cambridge: Cambridge University Press. tion’, Human Communication Research, 23(3), Sternberg, R. J. Lubart, T. I. (1999) ‘The concept of 342–69. creativity: prospects and paradigms’, Handbook Wehner, L., Csikszentmihalyi, M. and Magyari-Beck, I. of Creativity, Cambridge: Cambridge University (1991) ‘Current approaches used in studying Press. creativity: an exploratory investigation’, Creativity Tidd, J., Bessant, J. and Pavitt, K. (1997) Integrat- Research Journal, 4(3), 261–71. ing Technological, Market and Organisational Weick, C. (1979) The Social Psychology of Organising, Change: Managing Innovation, Chichester: Wiley Reading: Addison-Wesley. and Sons. Weisberg, J. (1993) Beyond the Myth of Genius, New Trefﬁnger, D. J. (1987) ‘Research on creativity assess- York: W. H. Freeman. ment’, Frontiers of Creativity Research, New York: Bearly Ltd., pp. 103–19.

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 25 2 3 4 Language as a corporate asset 5 6 Krishna S. Dhir 7 8 9 10 1 2 3 4222 5 With corporations operating in an increasingly globalized environment, many are paying 6 attention to the languages in which they conduct their business. This chapter introduces 7 the concept of language as corporate asset. Analogies between money and message and 8 between, currency and language, form the basis of the ideas developed here. The role of 9 language in emerging knowledge economies, globalization of business and workforce 20 diversity is examined while the economics of corporate vocabulary and language is dis- 1 cussed from the perspective of corporate planners. Finally, an example illustrates how a 2 global corporation may formulate its language policy. 3 4 5 6 7 Introduction prior to the 1960s. Until the mid-1960s the 8 concept of the economics of language was not 9 With increased globalization, corporations are well understood or articulated. Since the mid- 30222 paying attention to the languages in which 1960s, however, linguists have begun to pay 1 they conduct their business. Businesses that attention to the link between language and 2 operate globally bring together people from economics. As of 1996, there were reportedly 3 different cultures and traditions, who were just more than a hundred academic articles 4 educated through different learning processes, and books published by economists on lan- 5 and who operate in different political systems guage matters. Interestingly, a majority of 6 in regions with different levels of industrial these works had the specific focus of exploring 7 development. Language affects the ability of the evolution of language status and language 8 multinational organizations to function in the use in business organizations within Quebec, 9 global market. Yet, the need for corporate lan- Canada (Grin, 1996: 18; Dhir and Savage, 40 guage policies has not been adequately recog- 2002). Although the business of foreign lan- 1 nized in strategic management literature or guage education continues to thrive today 2 communication literature. Research in the due to growth in international trade, scientific 3222 field of the economics of language was rare co-operation, tourism and the increasing

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors demand for cultural insight (Coulmas 1991: computation (Leibniz, 1983: 5). He was look- 1), linguists have published relatively fewer ing for precision in valuation through both works. Corporate planners, too, have gener- linguistic nomenclature and economic meas- ally not paid much attention to the important urement. According to Coulmas (1992): role played by languages in the conduct of ‘Leibniz did not believe that, as a matter of modern business. In this chapter, some of the principle, the expressive power of one lan- emergent conditions that necessitate corpor- guage was greater than another. Nevertheless, ate foregrounding of language in the formu- he realized the advantage of precision. The lation of business strategies are discussed. smaller the unit, the greater the exactitude of Language is presented as a corporate asset the transactions that can be carried out in a that offers means for information and knowl- system that uses it’ (Coulmas, 1992: 3). edge management. A few decades later, Hume (1964) moved beyond the metaphor. He saw parallels in the development and functions of language and Language as an asset money: ‘In like manner are languages gradually establish’d by human conventions with- Although interest in academic research of the out any promise. In like manner do gold and economics of language is of recent origin, by silver become the common measures of the end of the seventeenth century many exchange, and are esteem’d sufﬁcient pay- philosophers already had started to recognize ment for what is of a hundred times their the relationship between economics and lan- value’ (Coulmas, 1992: 3). guage. Coulmas (1992: 2) observes, ‘The According to another seventeenth-century analogy of money and language which is thinker, Adam Smith, the currency of a coun- so conspicuously encoded in language itself try ‘is the exact measure of the real exchange- has often been regarded as mere stylistic dec- able value of all commodities. It is so, oration.’ He translates an example from the however, at the same time and place only’ early seventeenth-century thinker, Stefano (Smith, 1904: 39). Correspondingly, explains Guazzo, who used the analogy in making the Coulmas (1992: 4), ‘the value of words is point that in public speech the valuable must contingent upon temporarily and locally lim- be separated from the worthless, as follows: ited common practice’. Coulmas quotes ‘Just as all sorts of coins – golden, silver Hamann, a contemporary of Smith, to make and copper – issue from a purse, expressions his point: and other words of greater and lesser value come out of the speaker’s mouth’ (Coulmas, Money and language are two objects whose 1992: 2). investigation is as profound and abstract as Late in the seventeenth century, Locke their use is common. Both are more closely referred to word as ‘the common measure of related to each other than should be con- commerce and communication’ (Locke, 1959: jectured. The theory of the one explains 154). Locke’s contemporary, Leibniz, alluded that of the other; they seem to issue from to the link between language and money, common grounds. The wealth of all human drawing an analogy between words as aid knowledge is based on the exchange of to thought and logic and counters as aid to words . . . All treasures of civic and social

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 life, on the other hand, are related to environment may be affected by such consid- 2 money as their universal measure. erations as the demographic range in which 3 (Coulmas, 1992: 4) the currency is used, the degree of investment 4 made in that currency by the economic com- 5 Coulmas (1992: 4) goes on to explain that munity, general demand for the currency, and 6 ‘words do not derive their meaning from their so on. Similarly the value of a language to an 7 material substance . . . but from the purpose organization may be affected by the degree to 8 they serve in transmitting nonmaterial con- which the language is used in the demo- 9 tent, and likewise the value of money is not graphic community defining the organiza- 10 based on its material embodiment, but on the tion’s strategic environment, the investment 1 function it fulfils as a common means for in the language relative to other available 2 the exchange of goods’. languages, demand for the language as a 3 As described above, in the literature the commodity within the organization’s strategic 4222 analogy is generally drawn between language community, and so on. Just as different 5 and money. However, better analogies may be prevailing economic trends have implications 6 drawn between (1) message and money, and for strategies devised for the management of 7 (2) language and currency. In all economic currencies held by a company, different social 8 communities, money, in one form or another, trends have implications for the management 9 is used to exchange economic assets between of a corporation’s language assets. We will 20 parties engaged in economic activities. now briefly explore some of these trends. 1 Similarly, in all social communities, messages 2 are used to exchange ideas, information, or Evolving trends 3 knowledge between parties engaged in social 4 discourse. Economists typically emphasize In the prevailing social context, three distinct 5 three functions of currency as: (1) a unit of trends are evolving that characterize the chal- 6 exchange, (2) a unit of account, and (3) a store lenges facing corporate planners in managing 7 of value. As a unit of account, it is used in language as a corporate asset. These are: 8 invoicing trade and in denominating financial (1) the evolution of the knowledge economy, 9 instruments. As a medium of exchange, it is (2) the globalization of business and economy, 30222 used to settle trade and financial transactions. and (3) diversity of the workforce. As we shall 1 As a store of value, it serves as an investment see, each of these point to the importance of 2 asset. A language, too, may be seen as per- the development of an organizational culture 3 forming three analogous functions of (1) that is conducive to the creation and applica- 4 exchanging information and knowledge, (2) tion of knowledge, free flow of organizational 5 accounting through narratives, and (3) storing information and empowerment of its con- 6 value of knowledge and knowhow. stituent members. We also shall see how lan- 7 In different economic communities, differ- guage plays a critical role in the formation of 8 ent currency may be used to transact business. the organizational culture through its role in 9 Similarly, in different social communities, knowledge creation and application, flow of 40 different language may be deployed to information and functioning of the organiza- 1 communicate ideas. The value of a currency tion. A brief review of each trend is presented 2 to an organization operating in an economic below. 3222

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors The evolution of the knowledge reflection, and repetition. The transfer of economy knowledge may be slow and individually oriented. The means of transfer is person to The traditional paradigm of organizational person, with the aid of games, simulation theory views an organization as a system that models, and role-playing that require learners processes information and solves problems to recreate skill. Knowledge-driven organiza- through decision making. It seeks to improve tions, such as consulting firms, sell processes the efficiency with which information is pro- to solve problems for individual customers. cessed within the context of decision making Major costs relate to delivery of services. Costs in an uncertain environment. Recently, how- increase with volume (Sveiby, 1997: 24–50). ever, an alternative paradigm has emerged. Complex organizations have elements of This new paradigm suggests that organizations both information-driven organizations and in the contemporary environment should knowledge-driven organizations. In the con- be viewed as systems that create and manage text of a knowledge model, reflecting about both information and knowledge (Nonaka, the purpose of an organization reveals the 1994; Kolodnyet et al., 1996; Scarbrough, importance of intangible assets in fostering 1996; Amidon, 1997). This paradigm is the corporate competences. This realization acts basis of a growing body of literature on the to render visible new concepts of assets and knowledge creation process and its manage- desired competences. Five factors that moti- ment. Within the framework of this paradigm, vate the demand for new corporate compe- information-driven organizations and know- tencies, as enumerated by Dhir and Harris ledge-driven organizations anchor opposite (2001), are: ends of a continuum (Sveiby, 1997; Dhir and Harris, 2001). Nonaka (1994) has attempted 1 New stakeholders. New stakeholders are to develop the essential elements of a theory calling for a focus on relevant corporate of organizational knowledge creation. competences including a general under- Information-driven organizations sell know- standing of local and global environ- ledge as a package. They focus on knowing ments, communication skills, inter- facts acquired through information that is personal and team skills, and stakeholder often obtained by formal education. Inform- orientation. ation is independent of the individual creator. 2 New expectations. Corporations are ex- Its transfer is quick and mass oriented. Means pected to develop processes that add of communication may include lectures and value to organizations. This requires that audiovisual mediums. Information-driven corporations focus less on activities de- organizations, such as software companies, signed to convert events into information bundle information into standardized pack- (e.g. collecting, classifying and summariz- ages for a mass of customers. Major costs of ing activities) and focus more on activities communication are developmental. The cost designed to transform information into of increasing volume is minimal. At the other knowledge (e.g. analysing, interpreting, end of the spectrum, knowledge-driven organ- and evaluating activities that drive the izations sell knowledge, the capacity to act, as decision-making process). Competences a process of knowing. They focus on learning basic to value enhancement are: analytical by doing through training, practice, mistakes, skills; advisory skills; organizational pro-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 cesses and model building understanding, There is considerable interest in the study 2 including sensitive analysis; and oper- of organizational design for effective know- 3 ational definitions of concepts and design ledge creation and management. Blackler 4 of appropriate measurement techniques (1995) has reviewed concepts of knowledge, 5 development that lend themselves to classified them, and examined processes for 6 decision making and process intervention. generating, storing, and applying knowledge. 7 3 New technologies. Emerging computer- He has developed a typology of knowledge 8 based technologies offer enormous organizations. Other writers have discussed 9 potential for efficiency, innovation, and various aspects of management of knowledge 10 value creation to society. Value derives (Peters, 1992; Skyrme and Amidon, 1997; 1 from knowledge, and human capital is the Sveiby, 1997), including designs of work sys- 2 most critical corporate asset. Vital compe- tems for knowledge workers (Pasmore and 3 tences include hardware and software Purser, 1993), organizational learning in 4222 development, problem solving, encryp- knowledge-intensive firms (Starbuck, 1992), 5 tion and communication. and power and control of expertise (Reed, 6 4 New time horizons. The environment in 1996). Unfortunately, the relationship be- 7 which today’s organizations exist is in a tween language and knowledge in the context 8 continual state of flux. Complex changes of organizational design has not been studied. 9 occur at an ever-increasing pace. Given Let us examine the role of language in know- 20 the rapidity of change, corporations ledge management. 1 must invest heavily in lifelong learning For effective management of the know- 2 skills to enable individuals to maintain ledge creation process, it is important to 3 current knowledge, skills, and essential comprehend the difference between know- 4 competences to facilitate agile response. It ledge and understanding. Schwandt (1999) 5 is necessary that continuing education expresses the difference between knowledge 6 emphasize intellectual capacity and pro- and understanding in German through the 7 fessional development. questions, ‘Woher weibetat du das?’ and ‘Wie 8 5 New competition. As information becomes verstehen Sie das?’ In English one would ask, 9 accessible across national boundaries, ‘How do you know that?’ and ‘What do you 30222 global markets are becoming dominant. make of that?’ It may be argued that to effec- 1 Organizations need to develop the ability tively use or apply information, as knowledge, 2 to understand emerging problems, and to to strategic advantage, an organization should 3 rapidly develop and deploy cost-effective understand the knowledge, as evidenced by its 4 services. Required competences include making something of that knowledge. To com- 5 marketing and selling, understanding pete effectively, a multinational corporation, 6 stakeholder needs, problem solving, operating at a global scale, must acquire the 7 designing and deploying effective solu- ability to make something of its knowledge, 8 tions, and communicating. through its core competences, including com- 9 munication in different historical, cultural and 40 Communication, and therefore language, is linguistic milieux. In the 1990s, 97 per cent of 1 an important competency implied by each of US export growth came from small- to 2 the five factors described above. medium-sized businesses, but only 10 per 3222 cent of these companies were exporting

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors their products. In testimony before the US are presented to us as we deal with them Congress, lobbyists seeking increased funding (Schwandt, 1999; Zeddies, 2002). Darlington- for foreign language instruction explained based Adrenalin-Moto is a small firm in the that the most frequent reason cited by those United Kingdom with three staff members, not exporting was a lack of background know- supplying motorbike parts and accessories. Its ledge and language skills required to under- owner, Debbie Purdy says: ‘France is our stand foreign markets (Peterson, 2002). This is second-biggest market, and when the French by no means a uniquely American problem. are selling to us, language isn’t a problem. In a recent survey of 1,000 German small- When we are selling to them, however, it is a to medium-sized exporters, 60 per cent of different matter. It can be frustrating. We those interviewed have no business connec- knew that unless we addressed the problem tions with enterprises in the United Kingdom, we would miss out on a lot of trade.’ but if they were to establish them, 80 per cent Adrenalin-Moto set up a second, French-lan- would prefer to correspond in German. Only guage website at a cost of £2,000. Almost 20 per cent would even be prepared to use immediately, online enquiries began to arrive English. Of those who trade with the United (Coleman and Cree, 2002). Kingdom in English, half said that they would definitely prefer to use German and look more favourably on UK companies that have made Globalization of business the effort to learn German (Coleman and Cree, 2002). Even as corporations are adapting to the When a person comprehends the socio- evolving knowledge economy, business and economic culture of a market, that person is economy are becoming increasingly global- able to engage and participate in what ized. In response to this trend, corporations Gadamer refers to as the ‘art of conversation’ bring together people with different cultural (Gadamer, 1975). Knowledge and under- orientations, who are educated differently, standing become possible when a person operate in different political environments overcomes prejudices that prevent new with different levels of industrial develop- understanding, and allows transformation ment, and do not all speak the same lan- through whatever is revealed through the guage. Nevertheless, they work toward a course of conversation (Zeddies, 2002). The common organizational mission. Language same may be said for a group of people, or an affects the ability of multinational organiza- organization. An organization must be willing tions to function in the global market. to participate in the socio-economic culture of However, the need for corporate language the local market, and through adaptation, be policies has not been adequately explored in transformed by the socio-economic realities it the strategic management literature. Also, the encounters. Language is the fundamental issue has not been discussed in the broader medium through which culture, tradition communication literature (Dhir and Goke- and custom are transmitted. Moreover, the Pariola, 2002). In the following sections, we capacity of language is not limited to designa- examine some of the factors that would tion, discovery, reference, or depiction of define the development of a corporate lan- situations. Language also is used to carry out guage policy in a global market. We begin or perform actions and to reveal how things with a brief literature review.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Early in research on internationalization of and Bartlett, 1995). Personal relationships 2 corporations, Wiedersheim-Paul (1972) cited within an organization define the feasibility 3 the importance of psychic or cultural distance and the effectiveness of communication, 4 between the locations in determining how collaborative learning, and knowledge cre- 5 a multinational company’s operations get ation, with direct implications for the corpora- 6 organized. Language has consistently been tion’s competitive advantage in its strategic 7 recognized as an important factor contributing environment. Some works draw attention to 8 to cultural distance (Johanson and Vahlne, the relationship between language and power 9 1977; Fixman, 1990; Petersen and Pedersen, (Foucault, 1978; Bourdieu, 1991; Janks, 10 1997). More recently, it has been argued that 2000). Yet, the strategic management litera- 1 the issue of language should be addressed in ture rarely discusses the impact of language 2 terms of the strategic management of multi- on multinational operations (Gupta and 3 national corporations (Marschan et al., 1997; Govindarajan, 1991; Egelhoff, 1993; Ghoshal 4222 Dhir and Savage, 2001; Dhir and Goke-Pariola, et al., 1994; Park et al., 1996) beyond 5 2002; Dhir and Savage, 2002). In a global acknowledging its importance (Johanson and 6 organization that operates in diverse locations Vahlne, 1977), even when otherwise focused 7 and cultures, the challenge of deriving synergy on the importance of local considerations in 8 from a set of activities performed by individ- effective management of international busi- 9 uals who speak different languages can be ness (Andersen, 1993; Clegg et al., 1999). The 20 daunting. Hood and Truijens (1993) studied a broader communications literature, too, gen- 1 Japanese manufacturing company in Europe erally ignores the role of language in the 2 and found that language was one of the domi- development of informal channels of inform- 3 nant factors considered in their decision to ation flow (Nohria and Eccles, 1992; 4 locate in an English-speaking environment. Krackhardt and Hanson, 1993; Macdonald, 5 However, such strategies can be limiting, and 1996). 6 work only in the short term. As suggested by Welch et al., (2001) warn that attempts to 7 Marschan-Piekkari et al., (1999), ‘a Canadian impose a common corporate language might 8 firm moving into the United States, then hinder or alter information flow, knowledge 9 Australia, New Zealand and the United transfer and communication. Dhir and Goke- 30222 Kingdom, can postpone language complica- Pariola (2002) make a case for language poli- 1 tions of international growth for some time’. cies in multinational corporations. They, too, 2 Generally, corporations as well as other argue that the process that constrains a com- 3 organized communities such as nations or pany to a standard language may actually 4 groups of people, seek improved efficiency deny it access to critical resources unique to 5 of communication and operation through a the members’ own diverse training and 6 standardized language adopted as its official experiences. Diversity of cultures represented 7 language (Marschan-Piekkari et al., 1999; and languages spoken by the personnel may 8 Dhir and Savage, 2002). Nevertheless, multi- offer opportunities to a global organization 9 national corporations favour the develop- not available to its competitors. In addition, a 40 ment of a strong sense of common purpose, number of ongoing changes in the pattern of 1 managed through soft control processes, that relationships between nations and societies 2 operate through informal communication make it imperative for multinational corpora- 3222 channels, rather than formal means (Ghoshal tions to take a serious look at developing

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors language policies. With rare exceptions nomic means of production within the (Marschan et al., 1997; Dhir and Goke-Pariola, time frame of its strategic plan relative to 2002), the need for corporate language poli- other available languages. cies has not been adequately recognized in either the strategic management literature or With such conception of language, corpora- the communication literature. Dhir and tions can begin to think in terms of a portfolio Savage (2002) offer a judgment-analytic of language assets much in the same way approach for corporations to assess the eco- as it thinks of a portfolio of financial currency nomic value of languages. They posit that dif- assets. It is noteworthy that the analogy be- ferent organizations may receive different tween language and currency holds even in value from delivered functions of a language. situations where nations (e.g. India) seek It is imperative that the assessed value account improved communication efficiency through for not only those functional properties and adoption of a language not indigenous to qualities of the language in question, but also them (e.g. English), and improved financial the context of the strategic environment in efficiency through replacement of their which the organization assessing it exists and national currency (e.g. quetzals in Guatemala, operates. For a given corporation, the value of colóns in El Salvador, balboas in Panama, and a language may be determined by various fac- sucres in Ecuador) with a currency of another tors. Examples of these factors provided by nation (US dollar) as legal tender. The adop- Dhir and Savage (2002) are the degree to tion of both language and currency may be which: formal or informal, and official or unofficial. For more information on currency replace- 1 the language is used in the demographic ment, a process usually referred to as dollariza- community defining the organization’s tion, see Calvo (1999), Antinolfi and Keister strategic environment relative to other (2001) and Edwards (2001). available languages; 2 the demographic community defining the organization’s internal environment has Workforce diversity collectively invested in the language relative to other available languages; Since the 1990s, considerable attention has 3 the language is demanded as a commod- been paid to the conditions under which ity within the demographic community cultural diversity enhances or detracts from defining the organization’s strategic envir- work group functioning. There is considerable onment, both external and internal, rela- literature recommending that managers tive to other available languages; should increase workforce diversity to 4 the demographic community defining enhance work group effectiveness, both in the multinational business organization’s domestic and global organizations (Thomas, strategic environment, both external 1991; Jackson and Associates, 1992; and internal, creates knowledge in the Morrison, 1992; Cox, 1993). However, empir- language relative to other available lan- ical research in support of these recommenda- guages; and, tions is limited. Studies have been reported on 5 the language can be developed as the the impact of diversity in (1) identity of group multinational business organization’s eco- memberships, in terms of race and sex (Cox,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 1993; Jackson and Ruderman, 1995); (2) hypothesize different models for the impact of 2 organizational group membership, in terms of diversity on work group effectiveness. Pelled 3 hierarchical position or organizational func- (1996) expected racial diversity, as a source of 4 tion (Bantel and Jackson, 1989; Ancona and visible differences, to impact work group 5 Caldwell, 1992); and (3) individual character- effectiveness negatively. Cox et al., (1991), on 6 istics, in terms of idiosyncratic attitudes, the other hand, expected racial diversity, as a 7 values and preferences (Meglino et al.,1989; source of cultural differences, to have a posi- 8 Bochner and Hesketh, 1994). On the one tive outcome. Ely and Thomas (2001) have 9 hand, decision scientists have developed reviewed the studies reported in the literature 10 sophisticated techniques for seeking optimal on cultural diversity at work, and categorized 1 solutions to maximum diversity problems them in terms of effects of proportional repre- 2 (Kuo et al.,1993; Glover et al.,1995; Agca sentation and of group composition. They 3 et al., 2000). On the other hand, organiza- focused on demographic variables including 4222 tional theorists have generated numerous race, ethnicity, sex, social class, religion, 5 dimensions for classifying demographic differ- nationality and sexual identity; but not on lan- 6 ences. Milliken and Martins (1996) found that guage. 7 very few organizational studies have exam- The merits of diversity are debated widely 8 ined how cultural values affect individuals or in a variety of organizations. In the face of 9 groups in organizations. The challenge of admonitions from scholars that neglect of 20 deﬁning diversity itself confounds the under- workplace diversity may run the risk of loss 1 standing of the impact of workforce diversity. of competitive advantage, corporations have 2 Yet, diversity management is predicted to be undertaken various forms of diversity man- 3 one of the most significant organizational agement initiatives. These initiatives have gen- 4 issues of coming decades (White and Nair, erally aimed at (1) increasing sensitivity to 5 1994). cultural differences; (2) developing the ability 6 Diversity is a characteristic of groups of two to recognize, accept and value diversity; (3) 7 or more people. It typically refers to demo- minimizing patterns of inequality experienced 8 graphic differences of one sort or another by women and minorities; (4) improving 9 among group members (McGrath et al.,1995). cross-cultural interactions and interpersonal 30222 These differences have often resulted in differ- relationships among gender and ethnic 1 ent kinds of diversity. Consequently, empirical groups; and (5) modifying organizational 2 studies have resulted in ambivalent results, culture and leadership practices (Soni, 2001). 3 depending on the manner in which diversity is Whether the goal of a diversity initiative is 4 characterized. Studies on race and gender, for achieved depends largely on an organiza- 5 instance, have demonstrated both positive tion’s diversity climate, which in turn is de- 6 and negative impacts on work group function- fined by the organization’s culture (Cox, 7 ing (Williams and O’Reilly, 1998). In another 1993). According to Soni (2001), ‘If employ- 8 instance, Pelled (1996) makes one set of pre- ees and managers do not accept and value 9 dictions about how group work members are differences and recognize the importance of 40 affected by racial diversity, and another about the employer’s diversity management initia- 1 how they are affected by functional back- tives, these initiatives are likely to have a 2 ground diversity based on the visibility of race very low probability of succeeding’ (Soni, 3222 and the job-relatedness. Different researchers 2001: 396).

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Individuals possess unique personal cul- nomena that are affected by such ideas, tures. Organizations experience the impact and all relationships between ideas and of cultural diversity through individuals identi- other phenomena that have or have not fying with different sets of cultural groups, been identifiably affected by such ideas. based on some set of shared characteristics. The definition is applied to such terms as They may identify with more than one cul- culture trait, culture complex, culture pat- tural group, with different degrees of affinity tern, etc. (Cox, 1993). Language is one of the important factors defining an individual’s personal cul- Definitions of culture focus on development ture. It is a factor contributing to both human of intellectual and moral faculties, often capital and ethnicity (Pendakur and Pendakur, through education; intellectual, artistic, or 2002). However, none of the studies dis- otherwise creative activity; the process of cussed above included language as a factor acquiring knowledge of these areas; accumu- contributing to diversity, or explored the role lated and shared beliefs, social forms, atti- of language in management of diversity. It is tudes, values, goals, practices and traits of a noteworthy that workforce diversity studies group, including company and corporation have mostly focused on personal characteris- (Dhir and Savage, 2002). Attention to the tics that usually cannot be changed, such as strategic need for developing the appropriate age, gender, race, sexual orientation, physical culture throughout an organization, in turn, disability and ethnic heritage. Language, on brings attention to the choice of language. the other hand, can be changed to the extent Language, after all, is the essential skill giving that it can be learned. man the capacity for learning and transmitting The value of the language used by an knowledge. The choice is complicated in organization is rooted in its organizational cul- the light of workforce diversity. As described ture. According to Zeddies (2002), ‘language by Zeddies (2002): is the primary and fundamental medium through which culture, tradition, and custom Language is much more than a mere are transmitted down through history’. assemblage of words structured by syntax Nevertheless, the complexity of managing the and grammar; it represents the evolving language asset of a corporation is apparent in varieties of human life and living over the the definition of culture and the nature of vast expanse of time. The values, beliefs, workforce diversity. The term culture can have victories, defeats, joys, sorrows, hopes, and several meanings within the context of social visions of generations of human commun- research. ities are bound up in and preserved by the After defining symbol, idea and other language of a culture . . . Through language necessary terms of the definition, Blumenthal a world is disclosed to us. (1940) defines culture as (Zeddies, 2002)

the world stream of ideas that are com- According to Gadamer, all aspects of human municable by means of symbols from the experience are informed and affected by lan- ﬁrst of such ideas in the cosmos to the guage (Gadamer, 1975; Zeddies, 2002). present. Culture includes also the causal Taylor argues that language manifests a way relationships between such ideas, all phe- of being in the world (Taylor, 1985). Language

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 links terms or expression to concepts that have diversity, by adopting a single working 2 content in a specific context. Abrams (1983) language for the entire organization. They 3 describes a term as words or phrases, and may adopt a language that offers the most 4 concept as the definition of the term. Finegan efficient economic means of management, 5 et al., (1997) describe expression as words or within the context of the strategic environ- 6 phrases. They describe content as the situa- ment in which they exist and operate. 7 tions to which the expressions are applied. Language may be viewed as the means by 8 ‘There is no point of view outside the experi- which an organization communicates its cul- 9 ence of the world in language from which it ture to members within the society in which it 10 could itself become an object . . . Even to operates. However, as discussed below, it 1 speculate about nonverbal and non-linguistic does more than communicate culture. 2 realms of experience – such as music, dance, Through language it produces new concepts 3 or emotions – requires language to describe or to augment its knowledge base, develops 4222 articulate the nature and vicissitudes of those vocabulary unique to the organization 5 experiences’ (Zeddies, 2002). In such descrip- through which to manage its knowledge base, tions, different languages, in different cultural and exchanges value through the use of its 6 and traditional contexts, succeed to different working language that has been enhanced by 7 degrees. Meaning is assigned to expressions that vocabulary. 8 through social mediation. As stated by 9 Zeddies (2002), ‘the limits in our expressive 20 capacity do not necessarily correspond to a Production of vocabulary and 1 rigid boundary in the expressive power of lan- language 2 guage. Rather, the meanings that are not 3 available to us in words suggest that our par- Abrams (1983) proposed a hypothesis for 4 ticular cultural and historical moment may individual language behaviour. In the emerg- 5 not allow for those expressions.’ It is import- ing knowledge economy, his hypothesis may 6 ant for multinational corporations to recog- be extended to corporate organizational 7 nize this point for effective management of behaviour as well. Abrams views language as 8 knowledge, globalization and international- a society’s most important privately produced 9 ization processes, and workforce diversity. As public goods. He states: 30222 described by Zeddies (2002), even though we 1 may not be able to use words to describe a The coinage of a phrase or term to formal- 2 feeling, thought, or action, we are neverthe- ize a new concept provides positive exter- 3 less greatly influenced by that which language nalities to other members of society (for 4 presupposes and constitutes. example, it facilitates the transmission of 5 verbal and written communication). Based 6 on traditional measures, the language 7 Corporate vocabulary and market fits the economist’s description of a 8 language ‘free’ market. Over time, countless num- 9 bers of individuals . . . have contributed to 40 Corporations, even multinational corpora- the production process while virtually 1 tions, often seek to meet their communication everyone has functioned as a consumer of 2 needs, and the challenges of knowledge language goods. 3222 management, globalization and workforce (Abrams, 1983)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Abrams (1983) goes on to describe language concept, and the term representing it, is production in terms of two distinct outputs: adopted by the larger society of which the terms and definitions. Again, he states: producer is a member, then the psychic benefits may come in the form of, say, enhanced Producing a definition involves the combin- recognition of the producer, sometimes even ing of already existing terms to describe a associated with socio-economic rewards. new concept or new category for entities. Often, the private costs involved are minimal, The production – or ‘coining’ – of a term or and consist of time invested in ‘identifying word provides a convenient, shorthand and defining’ the concept and in ‘ponder- means of designating a concept for the ing and deciding’ a term that best describes purpose of communication . . . The utility the concept. Abrams’ (1983) hypothesis ex- maximizing individual would form a new plains why we see specific vocabularies devel- concept whenever the private marginal oped in different corporations. The corporate benefits from that action exceed the atten- organization may accrue benefits of enhanced dant private marginal costs. operational efficiency when its members (Abrams, 1983) adopt a new term, developed by one or more of its members to describe a new concept, The process of using terms or words that have including hypotheses, phenomena, or pro- already been defined to produce a definition cesses. Further, the individual or persons asso- of a new concept to which a new term can be ciating the new concept with a new term may assigned, is akin to the process used by know- accrue recognition and rewards from the other ledge managers who use facts and rules to members of the corporate organization. manage their knowledge base. Facts already The development of vocabulary that is known, along with newly acquired facts, are specific to a given organization is a commonly subjected to relationship rules. Language observed phenomenon. Black (1991) pro- plays an important role in the knowledge vides the following illustrative example of a creation process. Through those rules that military briefing that is replete with special- are satisfied by the facts at hand, new facts are ized military vocabulary: inferred, and thus the knowledge base is expanded. Between zero-five and zero-seven today allied smart bombs achieved very signifi- The economics of vocabulary cant terrain alteration. Because of our belief in the sanctity of human life, we have According to Abrams (1983), assigning a new attrited this main force in a surgical opera- term, which could be a word or phrase, to a tion that has gone the extra mile to avoid new concept may give to the producer at least collateral damage, though of course you’re two private benefits. One relates to the effi- always going to break some eggs . . . As for ciency of communication. A new term may our lead ground forces, they continue to allow the producer to reduce the verbiage haul ass and bypass, as our Pentagon needed to communicate an argument, present greensuiters like to say, and they will be a hypothesis or describe a phenomenon or a kicking some butt preparatory to cutting off position. The other relates to psychic benefits the enemy’s head. accrued to the producer. For instance, if the (Black, 1991)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Corporate examples exist in abundance tion’s unique set of concepts and terms that 2 (Haymes, 1995), both in the United States best suits its unique culture. Corporations seek 3 (Light and Tilsner, 1994; Anonymous, 1998) to use their working language to facilitate the 4 and outside the United States (Anonymous, creation of economic value through an 5 1999; Taylor, 2000). A prevailing example of exchange of ideas, within the context of their 6 corporate jargon from the United States is the respective corporate culture. Through their 7 term ‘procrastosnacking’, which stands for the language, corporations communicate inform- 8 negative phenomenon of ‘taking endless ation, and create knowledge that gives them 9 coffee or snack breaks in the staff canteen’ to an edge over their competitors in the market- 10 avoid work (Waller, 2001). Dobrzynski (1993) place. Thus, the language of an organization 1 describes the corporate vocabulary of IBM, may be viewed as the repository of that 2 which includes words, such as flatten, meaning organization’s knowledge base. As such, a lan- 3 to resolve an issue, as in ‘we have to flatten guage, like currency, is not value in itself, but 4222 this before tomorrow’s meeting’; non- creates value in its use or exchange (Coulmas, 5 concur, to disagree; pushback, a non-concur- 1991; Dhir and Savage, 2002). 6 rence, as in ‘I took the issue past Mike, but I 7 got a lot of pushback’; foil, an overhead slide; 8 and reswizzle, to tweak or improve something, The economics of language 9 as in ‘Joe’s boss asked him to reswizzle his 20 foils.’ Dhir and Savage (2002) describe two 1 approaches used by economists to empirically 2 measure the value of a language. In the first, 3 Opportunity in redundancy language is regarded as a means of exchange 4 and a store of value (Coulmas, 1991; Vaillan- 5 Abrams (1983) observes that since the devel- court, 1991: 30). Coulmas (1991) notes that 6 opment of new terms to represent new con- every language has utilitarian value. Utility 7 cepts is motivated by private benefits to be value refers to the sorts of tasks the language is 8 had, individuals or groups may coin new suitable for and the actual opportunities for 9 terms for concepts that already exist, and using a language at a given time and place. 30222 ascribe new definitions to terms that already Coulmas also notes that in the context of 1 exist. Abrams bemoans the fact that this international transactions and global markets, 2 results in what he refers to as terminological every language acquires an exchange value, 3 redundancy. He cites the example of the eco- which is determined by its demand. Both 4 nomic concept of ‘positive externality’, for the utility value and the exchange value of 5 which redundant terms include ‘external language can vary from context to context, 6 economy, spill-in, social benefit, beneficial and markets to markets. Dhir and Savage 7 third-party effect, spill-over benefit, beneficial (2002) offer an approach to the assessment of 8 neighbourhood effect, to name just a few’ the value of a working language in the context 9 (Abrams, 1983). As an economist, he sees of the strategic environment in which the 40 such redundancy to be a problem. However, organization assessing it exists and operates. 1 to a corporate planner or strategist, this possi- Treating language as human capital (Grenier 2 bility of redundancy is attractive, because it 1982), Breton (1998) uses the concept of 3222 offers the possibility to develop the corpora- ‘network externalities’ to describe how a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors dominant language emerges within historical, the organization together through soft con- socio-cultural conditions, and how learning trol mechanisms, such as corporate culture, this language yields benefits. described by Ferner et al.,(1995). However, The second approach looks at language as a the adoption of a standardized language is not characteristic of those who use it (Vaillancourt, always the optimal strategy, especially when 1991). Studies have tried to explain lower competitive advantage is to be gained earnings of certain groups in terms of dis- through access to non-English-speaking mar- crimination (Raynauld and Marion, 1972; kets. In finance, it is not uncommon for cor- Lang, 1993) and other factors (Migué, 1970; porations operating in inter-national markets, Lavoie, 1983), resulting in contradicting to hold a portfolio of currencies. Lester (1994) explanations. Language is also seen as acquir- reports that Nestlé designates both French ing economic value in terms of the know- and English as its official language, but also ledge that becomes accessible through it uses a wider range of languages for inter-sub- (Dhir and Savage, 2002). Economic studies sidiary communications. Siemens, a German have examined the spread (Hocevar, 1983) multinational corporation, invests heavily in and promotion (Grin, 1990a, 1990b) of lan- an in-house language training programme, guages. Generally, the potential benefit of globally available to its employees, through using economic tools, such as cost–benefit which they may acquire competencies in analysis, to assess the benefits to be derived German, English, French and Spanish (Lester, from acquisition of language skills is well 1994). In 1994, Lester noted, ‘the easiest and recognized (Jernudd and Jo, 1985; Cooper, cheapest way to approach the language prob- 1989). For further review of the literature on lem is to hire people already possessing the the economics of language see Grin (1996), required skills’ (Lester, 1994: 43). The prob- Breton (1998), and Dhir and Savage (2002). lem of language acquisition was seen to be a human resource management (HRM) one. Two years later, Reeves and Wright (1996) Formulating a corporate language suggested that global organizations would policy benefit from a language audit. Soon after that, Marschan et al. (1997) called for the issue of At first glance, the problem of adopting a lan- language choice and acquisition to be treated guage for corporate communication may as a strategic matter. As they put it: seem to be an easy one to solve, especially for organizations operating out of English- speaking countries. In view of widespread use An important first step might be to include of the English language, one might argue that language aspects at the highest level of the English language is the obvious choice, strategic planning and implementation; especially for operations in the global markets thinking through the language conse- and dealing with workforce diversity. A stan- quences of strategic decisions upon global dardized language, used both at the home operations; examining their demand on office and in local markets, facilitates efficient language facility throughout the global communication, and minimizes misunder- entity; and identifying possible barriers to standing between the various units of the implementation created by the inevitable organizations (Lester, 1994). What is more, a differences in language proficiency. common language adds to the glue that keeps (Marschan et al., 1997: 596)

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Marschan et al. (1997) went on to state, ‘lan- sought would afford the company the greatest 2 guage policies, especially when connected competitive advantage with respect to the 3 with HRM activities, are important in ensuring strategic environment within which it oper- 4 that language-competent staff are strategically ates. Ten languages are spoken in Switzerland, 5 positioned throughout the global organiza- including its four national languages: German 6 tions’. They also recognized that the language in one Schwyzerdütch dialect or the other, 7 audit suggested by Reeves and Wright (1996) French, Italian and Romansh. In its strategic 8 could be made part of the routine strategic environment, additional languages are spo- 9 assessment of a global organization’s strengths ken, including various African languages, 10 and weaknesses. How this was to be accom- various Indian languages, French, Japanese, 1 plished remained unclear. Portuguese, various Scandinavian languages, 2 The analogy drawn in this chapter, not Spanish, etc. 3 between language and money, but between While seeking a competitive advantage in 4222 language and currency, now paves the way the marketplace, a multinational corporation 5 for corporate planners to account for the would adopt a set of languages for its opera- 6 language issues in strategic analyses of global tions that offers it the most efficient economic 7 organizations, much in the same manner as means of knowledge creation and manage- 8 they account for the financial issues. Financial ment within the context of the strategic 9 assets are managed through their valuation. environment in which it operates. Different 20 Corporations that operate internationally to organizations may receive different value 1 access various markets for factors of produc- from different languages. It is imperative that 2 tion, and intermediate and finished products the assessed value account for not only those 3 and services, commonly formulate and imple- functional properties and qualities of the lan- 4 ment financial policies for acquiring and hold- guage in question, but also the context of the 5 ing a portfolio of currencies. Their objective is strategic environment in which the organiza- 6 to maximize the value of their financial assets. tion assessing it exists and operates. The deliv- 7 Similarly, corporations may now formulate ered functions would, after all, be determined 8 and implement language policies for acquir- by this strategic context. Different managers 9 ing competency in a portfolio of languages, so may perceive the various delivered functions 30222 as to maximize the value of their language differently. Different managers also may per- 1 assets. Dhir and Savage (2002) have devel- ceive an organization’s strategic environment 2 oped a judgement-analytic approach for the differently. The assessment of value of a lan- 3 assessment of the value of a language by a guage, therefore, is a matter of individual 4 global organization, within the context of the judgement, which may be subjective in nature 5 strategic environment in which it operates, (Dhir, 2001; Dhir and Savage, 2002). 6 facilitating this process. They simulated the The simulation study by Dhir and Savage 7 situation in which a multinational corpora- (2002) yielded a language policy for the Swiss 8 tion, with its world headquarters in Switzer- multinational corporation in question in terms 9 land, seeks to develop a language policy for of the following dimensions: 40 operation within their strategic environment 1 that includes North America, South America, 1 It defined the context of the language 2 Europe, South and Southeast Asia, Japan, policy as the assessment of the economic 3222 Africa and Australia. The language policy value of a language, in terms of the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors degree to which the language afforded 3 It specified the relative emphasis to placed competitive advantage, with respect to on the factors considered. the strategic environment within which 4 It specified how the information regarding the multinational corporation operates. each factor was to be integrated to arrive 2 It identified and defined the factors perti- at an overall judgement about the value nent to the determination of the eco- of the language. This refers to the under- nomic value of a language for the lying principle that governs how the purposes of the corporation. These were: information on the various factors is to be (a) Demographic range: the degree to used. which the language is used in the demographic community defining the multi- A case study national business organization’s strategic environment relative to other available We now offer a case illustration. Suppose that languages. you have been hired to be a consultant to (b) Total investment: the degree to which a corporation engaged in a medium-sized the demographic community defining the enterprise, based in France. The firm has been multinational business organization’s using French as its working language since its internal environment has collectively inception a decade ago. The management of invested in the language relative to other the firm has decided to expand its operations available languages. The investment into markets in England, Germany and Spain. refers to the degree to which the com- Managers feel that they need an additional munity in question learns and prefers the working language, along with French, to (1) language. serve as a medium of communication to (c) Demand: the degree to which the lan- enhance the flexibility of inter-subsidiary com- guage is demanded as a commodity munication; (2) provide a means of identi- within the demographic community fication so that they may develop appropriate defining the multinational business organ- local identity in different markets; and (3) ization’s strategic environment (both serve as a medium of development to create external and internal) relative to other human and intellectual capital in local mar- available languages. kets. You are being asked to formulate a lan- (d) Knowledge creativity: the degree to guage policy for this organization, and to which the demographic community defin- recommend whether the firm should adopt ing the multinational business organiza- English, German, or Spanish as the additional tion’s strategic environment (both working language. Answer the following six external and internal) creates knowledge questions: in the language relative to other available languages. 1 For what purpose is the policy to be (e) Functional potential: the degree to developed? Define the context of the lan- which the language can be developed as guage policy in terms of the criterion vari- the multinational business organization’s able to be assessed or managed. economic means of production within the time frame of its strategic plan relative to For instance, in the context of strategic plan- other available languages. ning, the criterion may be the degree to which

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 a language affords competitive advantage measure of Y would indicate that the 2 with respect to the strategic environment degree to which that factor is present in 3 within which the multinational corporation the particular language is extremely high. 4 operates. Or else, it may be something such as 5 For each factor, does an increase in the 5 which of alternative languages should be factor change the criterion variable? Is the 6 adopted for cross-subsidiary communication change an increase or a decrease? In fact, 7 that does not involve the home office. this change also could be linear or non- 8 linear. For the purpose of this illustration, 9 2 What are the key factors that influence the we assume that the change is linear. For 10 variable to be assessed or managed? treatment of non-linear changes, see Dhir 1 Identify the factors for which the policy and Savage (2002). 2 must account. Ideally, the set of factors 3 identified should be mutually exclusive Let us say that the firm’s strategy analysts have 4222 and collectively exhaustive. determined that, in the context of the firm’s 5 markets in England, Germany and Spain, the Now suppose the management of this firm 6 functionalities of the alternative languages, as has revealed its priorities relative to the func- 7 they affect the firm in question, rate as shown tions to be fulfilled by the second working lan- 8 below. Assume that all ratings are on a scale guage as follows: The function of the language 9 ranging from a low of 1 to a high of 10, where as a medium of communication is twice as 20 a measure of 1 for a functionality would indi- important to the firm as each of the remaining 1 cate that the level of that functionality offered two functions, which in turn are equally 2 by the language in question (Table 25.1) is important. 3 extremely low, and a value of 10 would indicate that the level of that functionality offered 4 3 What relative emphasis or weight is indi- by the language in question is extremely high. 5 cated for each of the factors identified in 6 item 2? To indicate this, distribute 100 6 What language would you recommend as 7 points among each factor in such a way the additional working language for the 8 that the points assigned to each factor firm in question? 9 indicates the relative importance of that 30222 factor in your assessment of the criterion Answers 1 variable. Then normalize the scores to rel- 2 ative weights by dividing the points 1 The question may be answered variously. 3 awarded by 100. For instance, the purpose of the language 4 4 On what scale could each of the factors be policy may be said to be to enhance the 5 measured? Factors that are a physical vari- firm’s competitive advantage with respect 6 able may be measurable in terms of phys- to the strategic environment within which 7 ical dimensions such as length, weight, it operates. Let us say that the criterion 8 etc. Factors that are not physical may be variable in the present case is the firm’s 9 measurable on a scale ranging from a low competitive advantage measured on a 40 of X, to a high of Y, where a measure of X scale from 1 to 10, where a measure of 1 for a factor would indicate that the degree 1 indicates an extremely low advantage, 2 to which that factor is present in the par- and a measure of 10 indicates an ex- 3222 ticular language is extremely low, and a tremely high advantage.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Table 25.1 Functionality offered by language 5 For each factor, an increase in the factor increases the competitive advantage. Functionality Alternative languages 6 The following analysis should be per- English German Spanish formed. For each language, discount the functionality rating by the relative weight Medium of communication 6 8 5 of that functionality. Then, add the result- Means of ing scores by columns, yielding a cumula- identification 3 7 6 tive rating of the corresponding language. Medium of development 4 5 8 In the example shown in Table 25.2, the highest cumulative rating is associated with the German language. German would, therefore, 2 The factors are the performance of the be recommended to the firm as the additional language as a (a) medium of communica- working language of choice. tion, (b) means of identification and (c) medium of development. 3 The factor, medium of communication, Summary would carry a relative weight of 50 points; means of identification would carry 25 In this chapter, the concept of language as a points; and medium of development also corporate asset was presented. An analogy would carry 25 points. The normalized was drawn between money and message, and relative weights would be 0.50, 0.25, and between currency and language. This analogy 0.25, respectively. formed the basis of the ideas developed 4 Each of the three factors can be measured here. The role of language in the evolving on a scale ranging from a low of 1 to trends of emerging knowledge economy, a high of 10, where a measure of 1 for a globalization of business, and workforce factor would indicate that the degree to diversity was examined. The literature on the which that factor is present in the particu- economics of language was reviewed from the lar language is extremely low, and a value perspective of corporate planners. Finally, an of 10 would indicate that the degree to example illustrated how a multinational corp- which that factor is present in the particu- oration may formulate and apply its language lar language is extremely high. policy.

Table 25.2 Functionality analysis

Functionality Alternative languages

English German Spanish

Medium of communication 6 × 0.50 = 3.00 8 × 0.50 = 4.00 5 × 0.50 = 2.50 Means of identiﬁcation 3 × 0.25 = 0.75 7 × 0.25 = 1.75 6 × 0.25 = 1.50 Medium of development 4 × 0.25 = 1.00 5 × 0.25 = 1.25 8 × 0.25 = 2.00 Total score 4.75 7.00 6.00

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© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 26 2 3 4 Arrival of the global village 5 6 Michael Morley 7 8 9 10 1 2 3 4222 5 In this chapter the author looks at the premise that the global village predicted by 6 Marshall McLuhan some thirty-five years ago is finally here. With its arrival the author 7 considers how, if any, the impact of technology has influenced both the roles of the corp- 8 orate communicator and global business practice, and the core skills that a professional 9 communicator will need to possess in this new age. The chapter looks at what those skills 20 might be and why, for an international practitioner, mastering them will be important in 1 dealing with the new business age. 2 3 4 5 6 7 The primeval forces that drive entrepreneurs than the power or profit that position brings. 8 to establish global empires have combined National rather than personal pride is a clear 9 with those that enable them to achieve their driving force for many of the huge corpora- 30222 ambitions. The driving forces are the quest for tions that emerged in post-war Japan and 1 survival, power, peace, pride and profit. more recently in Korea as they sought to reach 2 Company leaders know they must grow in size parity with – and then overtake – companies 3 if they are not to be swallowed up by a bigger in the United States and Europe. Profit is the 4 corporation. primary reason for the existence of business 5 Leaders of industry are just as hungry for enterprises. To achieve maximum profits, 6 power as presidents, prime ministers, generals the corporation must co-operate on a global 7 and bishops. Many also believe that an econ- scale. Technology, privatization, the disman- 8 omy in which nations are interdependent is tling of protectionism, swifter, cheaper travel, 9 a significant force for peace and that global less restricted movement of capital and labour, 40 corporations have a pivotal role to play in standardization and education have been 1 bringing that about. For some individuals, the important factors in helping business leaders 2 status conferred by being leader of a global achieve their global ambitions. All of these 3222 corporation is sometimes more important factors have contributed to the remarkable

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors growth of public relations. There is every agency networks or brands. Omnicom agen- prospect this growth will continue, notwith- cies combined to record $810 million, Inter- standing the bursting of the dot.com bubble, public $708 million and WPP $844 million in the aftershock sustained by the entire technol- fees for the year 2000, in the Council’s rank- ogy sector and the general slowdown in the ings. These new groupings have made bed- global economy that started at the turn of the fellows of previously fierce competitors such millennium. as Hill & Knowlton and Burson-Marsteller, The world’s ten biggest PR firms in 1990 now both owned by WPP, the British-based recorded fee income of $910 million, accord- communications conglomerate. ing to O’Dwyer’s Directory of PR Firms. Ten years later the top ten fee income had risen to $2.5 billion, as reported by the Council of PR Media impact Firms and published in PR Week (Table 26.1). With the premise that the global village has A massive consolidation of the largest PR arrived, the PR practitioner should examine agencies took place as the twentieth century closely how this will impact his work. The came to a close and continued at the begin- internet, television, telephone and radio have ning of the twenty-first. Larger agencies con- converged to take us into the age of instant tinued to acquire smaller ones as the principal communications, worldwide. agency networks sought to flesh out their In the length of time it took news to circu- service to clients geographically and by spe- late within a village of two hundred people cialty practice. To this a phenomenon new to two centuries ago, it is now possible for five the world of public relations – but which had billion people to become aware of an environ- been seen in the world of advertising for mental disaster, war or the outcome of a many years – was added a series of acquisi- major sporting event. The internet alone can tions that has created the formation of three disseminate news of a faulty or dangerous global super-groups, each comprising several product to a worldwide audience in minutes. The existence and speed of the new media Table 26.1 The world’s largest PR firms should not be the only subject of concern for the PR practitioner. Its ownership is of equal Firm name 2001 Worldwide importance. The period since the 1990s has revenue ($) seen the emergence of powerful international 1 Weber Shandwick Worldwide 426,572,018 media holding companies – Rupert Murdoch’s 2 Fleishman-Hillard Inc. 345,098,241 News Corp, AOL Time Warner, Disney, GE 3 Hill and Knowlton, Inc. 325,119,000 through NBC, Bertelsmann in Germany, and 4 INCEPTA (CITIGATE) 266,018,371 5 Burson Marsteller 259,112,000 Berlusconi in Italy. They all wield immense 6 Edelman Public Relations power nationally, regionally and, increasingly, Worldwide 223,708,535 internationally. 7 Ketchum, Inc. 185,221,000 8 Porter Novelli 179,294,000 9 GCI GROUP/APCO Worldwide 151,081,645 Languages 10 Ogilvy Public Relations Worldwide 145,949,285 Total top 10 2,507,174,095 Proficiency in more than your native language Source: Council of PR Firms/PR Week rankings is a major advantage. It signals both your

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 respect for and interest in people of other foreign markets, more companies are requir- 2 nations, in addition to allowing you to work ing foreign experience for top management 3 more easily in a variety of environments. You positions.’ 4 will put interactions with your colleagues and 5 audiences in other nations on a different and 6 stronger footing. Switch places 7 However, a warning: do not imagine that a Even if you plan to make your career in an 8 mere facility to speak foreign languages is suf- agency or consultancy, a spell of two or three 9 ficient to establish a worthwhile career in years working in-house at a corporation, 10 international public relations. I have known government department or other institution 1 people with a knack for learning several lan- will be valuable experience. It will give you 2 guages who, sadly, had little of consequence special insight into the minds of your clients 3 to say in any of them, or were incapable of and the pressures they face within their own 4222 real communication. organizations. Some in-house PR executives 5 are sceptical of the advice given by their ex- 6 ternal counsellors because they suspect it is 7 Customs and etiquette given without accountability for the outcome. 8 Your advice will be more respected if your 9 Respect for the customs and etiquette of each client knows that you have at one time stood 20 distinct society, country, nation or religion is in his shoes. 1 essential. Not only should these customs be 2 learned, they should be practised. 3 In the learning, you will often ﬁnd the keys Survival of concept 4 that open the door to improved communica- 5 tion, and that is your business. Without this It will be interesting to see if the concept of 6 knowledge, there can be no success, even for the global corporation survives. To do so, it 7 someone well qualiﬁed in all other respects. will have to overcome some powerful forces 8 of economic nationalism and protectionism, 9 as well as the internal pressure in many cor- 30222 International work experience porations, which together work to break up 1 enterprises into smaller pieces – either by 2 At a seminar of the Arthur W. Page Society geography or by the various lines of business 3 entitled ‘Public relations leadership in 2001: in which they are engaged. 4 greater importance, greater competition’, It will not be easy for most corporations, 5 Frank Vogl pointed out that ‘Globalisation however big they are, to become truly global. 6 will impact every aspect of the PR chief’s This would mean a revolution in thinking 7 work.’ Stressing that the communication func- which some will argue is against human 8 tion must reflect the new international nature. It means abandoning the enterprise’s 9 approach apparent in so many major corpora- national identity, origins, centre of gravity and 40 tions, Vogl referred to an article in the Wall community commitment, at least to a certain 1 Street Journal on 29 January 1996, which said extent. 2 that ‘the executive suite is going global. With When hard decisions have to be made, say 3222 nearly every industry targeting fast-growing on the matter of selective plant closures in an

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors economic downturn, the global corporation according to this inquiry among opinion should, in theory, make its choices based on leaders (Figure 26.1). economic imperatives, even to the extent In Europe the four most trusted brands are of closing facilities at the heart of its original NGOs – Amnesty International, World Wildlife home ofﬁce. Sentiment, lobbying, industrial Fund, Greenpeace and Oxfam. Meanwhile, and political unrest can often be powerful Johnson & Johnson, Coca-Cola, Microsoft and factors in changing the best plan on paper Ford still sit atop the trust league table in the into one that stands the highest chance of USA (Figures 26.2 and 26.3). being implemented. The specialization of international Trust in institutions 2003 public relations

An increasingly important movement dedi- Specialization, globalization and communica- cated to reversing the tide of globalization tion technology are currently the three most and its institutions – the IMF, WTO and potent forces affecting the practice of inter- the World Bank – ﬁrst came to general notice national public relations. Of these, specializa- at the G7 meeting in Seattle in 1999. This tion has had the longest history and the uneasy alliance of anarchists, political activists greatest impact since the 1970s. and established NGOs is becoming a formida- Until the mid-1960s, public relations was ble opponent that reflects and focuses a calling for generalists, whether they widespread public fear about some of the worked in-house at companies or in con- consequences of globalization led by inter- sultancies or agencies. As a youthful pro- national corporations. fession or craft, it also had to draw its recruits The ascendancy of NGOs as trusted sources from other ﬁelds, mostly journalism, which is shown in a recent round of research by at that time was also much more general Edelman. For the first time since tracking than it is today. began, NGOs became the most trusted institu- It was clear this could not last. The huge tions in both the United States and Europe, horizon of PR activity, which defies easy

100%

80%

60% 49% 48% 45% 39% 40% 35% 32% 25% 28% 20%

0% Business NGOs Government Media

US Europe

Figure 26.1 Trust in institutions, 2003 Source: Edelman survey, 2003

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Amnesty International 62% World Wildlife Fund 62% Greenpeace 51% 1222 Oxfam 49% 2 3 Microsoft 47% 4 Bayer 42% 5 Ford Motor Company 38% Coca-Cola 37% 6 BASF 36% 7 Unilever 34% 8 Johnson & Johnson 34% 9 Nike 34% 10 Royal Dutch/Shell 32% Deutsche Bank 30% 1 ExxonMobil 28% 2 Merck* 27% 3 HSBC* 25% 4222 McDonalds 22% Pfizer* 21% 5 Dow Chemical* 16% 6 Citicorp* 14% 7 Monsanto* 12%

8 0% 20% 40% 60% 80% 100% 9 20 Figure 26.2 Brand evaluator: Europe, 2003 Source: Edelman survey, 2003 1 2 Johnson & Johnson 69% 3 Coca-Cola 66% 4 Microsoft 59% 5 Ford Motor Company 56%

6 McDonalds 55% 7 Bayer 54% 8 Pfizer 52% 9 World Wildlife Fund 49% Merck 47% 30222 Nike 47% 1 Amnesty International 45% 2 Greenpeace 41% 3 Dow Chemical 40% 4 Citicorp 37% BASF 36% 5 Monsanto 36% 6 ExxonMobil 35% 7 Deutsche Bank 30% 8 Royal Dutch/Shell 29% 9 Unilever* 25% Oxfam* 16% 40 HSBC* 13% 1 0% 20% 40% 60% 80% 100% 2 3222 Figure 26.3 Brand evaluator: United States, 2003 Source: Edelman survey, 2003

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors definition, demanded that it be broken down There are three broad categories, and into manageable components. And in the within each many specialties: intervening years this has happened with a vengeance. • Industry, business or organization. There are discrete PR specialties in healthcare and pharmaceutical products, consumer prod- Why specialization? ucts and services, financial service organizations, technology, defence, professional Four factors are at work. The first is the services and many more. increased recognition of the importance of • PR practice areas. No matter what indus- public relations by different industries. This try, there are PR specialties in investor has meant the allocation of increasingly large relations, public affairs, community re- budgets which, in turn, call for greater num- lations, employee communication, spon- bers of dedicated, qualified personnel. sorship and event management. The second is the accelerating complexity • Technical skills. Within PR structures, there of almost every industry, as the knowledge are specialist roles played by dedicated base of science-driven fields of endeavour experts in publications, speechwriting, increases exponentially each year. The third video production, media relations, CD- factor is an increasingly educated and inquisi- rom and website development, and a tive consumer public served by a newly number of other functions. aggressive and growing media, which is itself structured on specialist lines. The movement toward specialization began in The fourth force driving specialization has the mid-1960s with pharmaceuticals and with been the emergence of many industries and the investor relations branch of financial professions which traditionally had shunned public relations, specialties that are still the communication. In some cases, as with law most dynamic and global within public re- and medicine, self-imposed or common-law lations. Technology began its dramatic growth regulations forbade self-promotion. Many of two decades later. those taboos have been torn down. A careful look at the PR league tables shows that the engines of growth in recent years Pharmaceuticals have been the boutique agencies which have offered specialist PR services of some kind. No one ever dreamed that the day would Even the major international full-service arrive when prescription-only drugs would be agencies mostly owe their successful growth to advertised to the public in general print and the performance of their individual specialist TV media, as has been the case since the early divisions. 1990s in the United States (albeit under tight control). Pharmaceutical companies turned in increasing numbers to PR practitioners to step Categories of specialization in and fill the informational and promotional gap to support what is now known as direct What are these specialties, and how have they to consumer (DTC) marketing. In 2000 over reshaped the public relations landscape? $2.5 billion was spent on DTC advertising in

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 America, an increase of 212 per cent over five Table 26.2 Industry sector: healthcare 2001 2 years, according to IMS (Table 26.2). revenues 3 4 Firm name 2001 revenue ($) 5 Financial 6 1 Fleishman-Hillard Inc. 60,050,000 7 The growth of financial public relations has 2 Ketchum, Inc 49,265,000 3 Porter Novelli 41,100,000 8 been powered by a battery of forces combin- 4 Edelman Public Relations 9 ing to create a major practice area. Worldwide 40,427,331 10 Increasing individual wealth in many coun- 5 Ruder Finn Group 33,268,000 1 tries has multiplied the number of individual 6 Ogilvy Public Relations 2 share owners. Unit trusts and mutual funds Worldwide 29,562,958 3 have attracted huge sums of money from 7 Weber Shandwick Worldwide 28,244,697 8 Manning, Selvage & Lee 28,189,631 4222 investors, allowing them the chance to partic- 9 GCI GROUP/APCO 5 ipate in baskets of stocks of every kind. The Worldwide 24,542,462 6 media coverage of the performance of com- 10 Burson Marsteller 20,701,000 7 panies makes heroes (or villains) out of those Total top 10 355,351,079 8 who lead them and has captivated large audi- Source: Council of PR Firms/PR Week rankings 9 ences previously unmoved by the making of 20 money or the movements of markets. 1 Internationalization of money markets and IR in the United States even has its own pro- 2 the world’s major stock exchanges and the fessional organization, the National Institute 3 introduction of 24-hour trading in stock shares of Investor Relations (NIRI). Similar organiza- 4 and bonds have supercharged the growth of tions exist in other countries, operating out- 5 international financial communications. side the orbit of PR organizations. 6 Although both require a mastery of Some of the largest IR/financial PR firms are 7 finance, public relations on behalf of financial not included in the rankings of PR firms 8 institutions that sell products and services because they do not reveal their income. The 9 (insurance bank, brokers, mutual funds, mort- total is impressive. Possibly the largest in the 30222 gages, etc.) and investor relations are two specialty is Kekst & Company, in the United 1 quite different practices. Public relations for States. And Brunswick, followed by Financial 2 financial service organizations is usually con- Dynamics is the dominant power in the 3 sidered to be a speciality within the category United Kingdom, where it represents twenty- 4 of consumer marketing communication. five companies of the FTSE Index. Through a 5 Internationally, investor relations (IR) as a series of acquisitions and mergers by Citigate, 6 general rule does not even report through the a new global player has been created under 7 PR channel to top management. Most public the name Incepta. Reporting $266 million in 8 companies have vice presidents (or directors) fees for the year 2001, this firm entered the 9 of investor relations whose direct reporting rankings as the fifth largest of all global PR 40 line is to the chief financial officer, who in turn firms. 1 reports to the CEO. In only a few companies 2 does the senior IR executive report to a chief 3222 communication officer.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors Technology Table 26.3 Industry sector: technology 2001 revenues Anyone practising public relations in the Firm name 2001 revenue financial sector today will testify to the import- ($) ance of technology as possibly the single most critical element in the economies of the 1 Weber Shandwick Worldwide 90,613,120 2 Fleishman-Hillard 88,020,000 developed world. 3 Waggener Edstrom, Inc. 56,685,000 Technology stocks have, for some investors, 4 Hill and Knowlton 47,357,000 even taken over as the barometer of perform- 5 Porter Novelli 41,862,000 ance of the stock market from the traditional 6 Brodeur Worldwide 39,600,000 baskets of blue chip shares such as the FTSE in 7 Edelman Public Relations Worldwide 37,646,937 the UK, the Dow Jones Index in the United 8 Ketchum 31,545,000 States, and the Hang Seng in Hong Kong. 9 SCHWARTZ COMMUNICA- The ‘bust’ in technology stocks that began TIONS 30,375,804 in 1999 and gathered steam, leading to the 10 Ogilvy Public Relations bursting of the dot.com bubble, had a ripple Worldwide 28,678,821 effect that was felt throughout the entire Total top 10 492,383,682 global economy. In 2001, every positive Source: Council of PR Firms/PR Week rankings report from a major tech sector company was put under the microscope as a possible har- Consumer products and services binger of a return to boom conditions for all shares. In the broad consumer and lifestyles field This leadership among investments was the there are PR specialties in food and nutrition, result of technology’s explosive growth over retail, home improvement, household dur- three decades, with the arrival of Clive Sinclair ables, fashion and beauty, luxury goods, the in Britain and Steve Jobs, Paul Allen and Bill home office, toys, entertainment and the arts, Gates in the United States. personal finance. Because of the size of the The drivers of this phenomenon have been industries they encompass, some consumer the internet, the personal computer (PC), the sub-specialties deserve special mention. digital revolution and the mobile phone and Trade associations, not for profit organiza- personal digital assistant (PDA). tions and business to business are further If money represents the building blocks of broad categories of public relations. the new global economy, technology is the cement that will hold them together. These are the two most international specialties Specialties by practice within the entire field of public relations. And according to the statistics of the Council Specialization in PR occurs in practice areas as of PR firms, in 2001 technology was still by well as by industry category. Important prac- far the largest specialty within public re- tice areas are public affairs, which includes lations even though revenues dropped by 20 public policy, governmental relations and per cent from their record level in 2000 (Table legislative affairs; environmental affairs; crisis 26.3). and issues management; employee communi-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 cation investor relations; corporate identity Convergence 2 and reputation; sponsorship and event 3 management and diversity. A phenomenon of the late 1990s is the recog- 4 Such practices can span a wide range of nition that the techniques of several special- 5 industries and organizations but, increasingly, ties can be combined for more powerful 6 individuals and agencies conduct their prac- marketing PR results that better meet the 7 tice in a single industry or a small number of demands of a more sophisticated consumer. 8 related industries. The following description is excerpted from an 9 article by my colleague, Nancy Turett, manag- 10 Specialization by function ing director of Edelman Healthcare World- 1 wide on how ‘convergence’ is being applied 2 The final form of public relations specializa- in the health sector. It can be applied equally 3 tion is found in the various functional skills in other industry sectors such as technology, 4222 called for in PR departments or agencies. They consumer or business to business. 5 are the communication techniques and tools 6 used by the international PR practitioner to Now, consumers are, themselves, the influ- 7 implement his strategies and concepts. entials. In many cases, it is the consumer 8 Because they have the capability of delivering who alerts the clinician to a novel treat- 9 messages and information in very targeted ment or new use for a medication that he 20 forms, the specialties can reach specifically or she has learned about from the media, 1 identified audiences as well as the general the internet, or direct marketing. Through 2 public. Companies have organized to create advocacy groups, it is often consumers who 3 and deliver these tools, directly for corporate are deciding where research dollars are 4 communication departments or as subcon- spent, and increasingly, how the research 5 tractors to PR agencies. should be conducted. 6 Functional specialties in constant use by PR Healthcare marketing today is increas- 7 practitioners are: ingly calling for a melding of the creativity 8 and mass appeal of traditional consumer 9 • publications, print production, graphic marketing with the credibility and pro- 30222 design; fessional targeting associated with ethical 1 • computer graphics; pharmaceutical marketing. In Convergence 2 • interactive communication, website de- Marketing, for example, target publications 3 velopment; for a new osteoporosis diagnostic device 4 • video and film production and distribu- might include Redbook, for a new fertility 5 tion; drug they might include GQ, and for a 6 • research; cholesterol drug they might include Bon 7 • media tour planning and booking; Appetit. A programme venue could be a 8 • advertisement creation, copywriting, lay- hotel or hospital health fair, but marketers 9 out, media planning; should also open their eyes to other sites, 40 • advertorial production; including sports events, day care and senior 1 • conference and event planning and centers, shopping malls and airports. The 2 management; ‘professional’ audiences that influence 3222 • media training. consumers now reach far beyond doctors,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors nurses and pharmacists, and include communicators are primarily responsible, the coaches, hairstylists, mothers-in-law, travel core public relations functions are much agents, and so on. In addition, consumer better represented at this senior level than are advocacy groups have grown in number as other areas such as advertising or marketing. well as influence, and building relation- Nearly one-third of these senior-most com- ships with these opinion leaders now is as municators have corporate communication as important as forging alliances with physi- their primary functional responsibility, cian thought leaders’. followed by public relations (16 per cent) and public affairs (12 per cent). The range of specific functions which fall Study of 100 companies under the corporate communication umbrella is becoming more diverse. More than A major benchmarking survey, conducted in 4 in 10 report that corporate communication 1997 by Edelman Public Relations World- maintains final oversight for advertising, mar- wide, the Medill School of Journalism and keting and promotional activities. Surprisingly, Opinion Research Corporation, sheds some more than 10 per cent are also directly res- light on how companies organize themselves ponsible for customer service at their respec- to handle corporate communication. One tive organizations. Nearly 9 in 10 respondents hundred international companies partici- indicate the use of external communica- pated. Here are some of the more interesting tion agencies at corporate headquarters, with findings about reporting lines and infrastruc- more than 7 in 10 also using external agencies ture. These findings are broadly confirmed by at the discretion of each business unit. Further, late studies involving global corporations. more than 5 in 10 also employ external Of the top communication officials 60 per communication agencies within their various cent are at the vice president/vice chair level. geographic regions. Only 5 per cent do not Nearly 2 in 10 hold the title of director, and use outside communication agencies. Overall, 1 in 10 are senior vice presidents. The remain- the annual operation budget (excluding ing 13 per cent hold the following titles: salaries) for corporate communication activi- manager (8 per cent), corporate vice presi- ties was reported as follows: dent (3 per cent) and executive vice president (2 per cent). The senior-most communicators report directly to the CEO at 54 per cent of the Corporate communication companies surveyed. For those commun- responsibilities icators who do not report directly to the CEO, 30 per cent report to the vice president, senior • Media relations: 99 per cent vice president or vice chair level of the organ- • Crisis/issues management: 93 per cent ization. Regardless of direct lines of reporting, • Employee communication: 88 per cent 93 per cent, nearly two-thirds of the most • Corporate identity/image: 83 per cent senior communicators, counsel with the CEO • Financial communication/investor rela- at least weekly and 15 per cent counsel with tions: 75 per cent the CEO on a daily basis. Although survey • Research and measurement: 75 per cent respondents reported a variety of functional • Community relations/corporate philan- communication areas for which senior-most thropy: 74 per cent

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • Advertising, marketing and promotions: procedures of respondents were measured 2 43 per cent against a list of criteria. These criteria were 3 • Government affairs: 35 per cent chosen to determine the degree of sophisti- 4 • Customer service: 11 per cent cation, or development, of the firm’s public 5 relations. The results showed that it was not 6 the very largest firms that were ‘best in class’. 7 Global corporate communication This honour went to medium-to-large organ- 8 budget (US$ equivalent): izations with a headquarters in Europe. 9 10 • Less than $1 million: 25 per cent 1 • Greater than $1 million, but less than $5 The Wakefield evolution model 2 million: 39 per cent 3 • Greater than $5 million, but less than $10 • Early evolution: Few resources, little inter- 4222 million: 11 per cent action between HQ and local units. 5 • Greater than $11 million, but less than • Moderate evolution: Growing resources, 6 $15 million: 4 per cent incomplete local staff, little or no HQ 7 • Greater than $20 million: 15 per cent authority. 8 • Advanced evolution: Almost complete 9 It is customary for most companies to draw a resources, better trained PR personnel, 20 clear line between communication in the incomplete HQ – local units co-ordina- 1 ‘home country’ of operations and in inter- tion. 2 national operations, with one person assigned • Complete evolution: Full staff, trained PR 3 to be responsible for management of com- officers in every unit; interaction for 4 munication in non-domestic markets. mutual goals (Figure 26.4). 5 There are good practical reasons why the 6 separate role of the international PR manager The qualifications of the international PR 7 within corporations continues to exist: most manager might be quite different from those 8 companies have a long history in their own of an executive who needs only to operate in 9 communities and know their way around the the home market. Some of these qualities are 30222 local and national media, the influential described in Chapter 1. 1 groups important for the business, their polit- Briefly, he will need to be culturally aware, 2 ical representatives and their customers. They patient, open-minded and inquisitive about 3 are less certain of themselves in their overseas alien customs and government procedures, 4 markets, which vary widely in almost every with the ability to work with people from a 5 respect. An international PR manager who variety of nations. At the same time, the inter- 6 makes it his business to be knowledgeable national executive must never become de- 7 about these markets and can manage a net- tached from the ‘mother company’ and 8 work of widely dispersed PR representatives is totally concentrate on the non-domestic oper- 9 worth his weight in gold. ations. One vital role is to act as a bridge 40 In a more recent survey among corpora- to the PR staff overseas who need and rely 1 tions in the United States, Europe, Asia and on him to be their link to headquarters, the 2 Latin America, conducted for Edelman by conduit of policies and news. Never under- 3222 Professor Rob Wakefield, the PR activities and estimate how most employees who work a

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1-way mandate Local units act currently serving. Achieve mastery and from HQ autonomously knowledge of the subcontracting services 24% 24% available to the agency that will benefit clients. • Use the resources and expertise of other professionals within the agency when faced with a complex problem. • Sharpen your creative edge by maintaining regular contact with other professionals in the firm. Local unit decision Joint decisions with HQ input HQ and units • Maintain strong powers of analysis, pre- 24% 28% sentation and creativity, because an agency has to sell its services in competi- Figure 26.4 Strategic decision making tion with other agencies. In short, consultants have to win the right to practise public relations. great distance from headquarters feel starved • Understand budgeting and business of information. Finally, he is the coach and management, vital elements for a career inspiration who transmits that most indefin- in a PR organization. able but, arguably, most important element: • Keep abreast of media developments, the corporate culture. new communication techniques and the current mood of public opinion on a variety of issues, if your advice is to be valued Qualities of good PR consultants as smart, objective and reliable. • Manage your own time expertly, allocat- Over and above the qualities needed by all PR ing it appropriately among client contact, practitioners, the following are those required programme execution, monitoring results, of agency executives: reporting to the client and maintaining direct contact with the media and other • Observe the successes and failures of tech- publics. niques employed for other clients and • Though difficult, the right time blend bring this knowledge and experience to must be achieved because the client pays bear for the benefit of clients you are for a combination of expertise and time.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 CHAPTER 27 2 3 4 Ethics and the corporate communicator 5 6 Albert S. Atkinson 7 8 9 10 1 2 3 4222 5 What is understood by the word ethics? Critically, what contribution does a corporate 6 communicator make to the ethical debate within today’s company boardrooms? Here, 7 the author charts the historical role of corporate communicators in ‘creating a soul’ for 8 the company; and the specific role played by corporate communication officials in the 9 financial reporting of companies. The events of Enron and other high profile scandals 20 have raised the spectre of corporate greed and the lack of corporate governance as 1 primary reasons for the collapse of organizations, with much of the criticism directed at 2 accounting firms and their procedures for monitoring business. Whilst the accounting 3 world is now actively addressing financial issues derived from these scandals, there are 4 5 nevertheless clear lessons to be learned by corporate communication professionals, both 6 in-house and outsourced. 7 8 9 30222 A consideration of ethics based upon the in the business school’s focus. It would appear 1 definitions below requires some consideration that perhaps more attention should be paid to 2 of conduct and morality. (‘Ethics’ – 1. the incorporating ethics into our everyday busi- 3 study of standards of conduct and moral ness activity. 4 judgement; moral philosophy. 2. a treatise on The fall of the dot.com industries and such 5 this study; book about morals. 3. the system or giants as Enron, WorldCom, Global Crossings, 6 code of morals of a particular philosopher, reli- Quest Communications International, Inc., 7 gion, group profession, etc.) It is a concept that Tyco and so many other firms, during the 8 is difficult to discuss and while there is years 2000 and 2001, has brought forth a 9 immediate understanding of when it is lack- plethora of disclosures of corporate wrong- 40 ing, its presence is often viewed as naive or doing. Much of this is attributed to the failure 1 weak. While much of the trust upon which of accounting firms and corporate boards to 2 transactional business is based relies upon its exercise appropriate governance. During this 3222 existence it does not occupy a significant place time much discussion has centred on the

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors accounting procedures being used and how Throughout all the press and business news the greed of corporate officers has led to the about the collapse little was said about the downfall of companies and the subsequent corporate communicator and their place in all loss of millions of dollars. These millions are this. While accountants provide the financials represented in jobs cut or lost by business fail- and corporate executives provide the direc- ures, the pension losses affecting thousands of tion, the corporate communicator provides employees and the huge losses in the stock the words – often of late words that have not market. reflected the true situation of the company. For a time there was some outcry as to What are the ethical boundaries involved? Is who would be punished for these failures and there a place in all of this for ethics and what violations of principles. There was castigation if any ethics are being taught to the corporate of accounting firms and of the investment leader today? bankers whose analysts failed to disclose The role of corporate communication has the irregularities and fallacious reporting. The its basis in the advertising and public relations press was on hand to point out the inequi- attempts of the corporations in the late nine- ties and every politician from local to state to teenth and early twentieth centuries to pro- federal was involved in some form of investi- vide an image for their companies and their gation. A Gallup poll, done in late 2001, showed in Table 27.1 Ethics by profession its annual gauge of the honesty and ethics of different professions that people placed busi- Profession % saying ness executives at a 25 per cent level while ‘very high’ or ‘high’ firefighters ranked 90 per cent, nurses at 83 per cent, US military at 81 per cent, stockbro- Firefighters 90 kers were at 19 per cent, and advertising prac- Nurses 83 titioners were at 11 per cent (Table 27.1). US military 81 Police 68 These percentages were a measure of those Pharmacists 68 who indicated that these professions were Medical doctors 66 very high or high in ethical practices. (Gibson Clergy 64 D., 2002) Data Source: Gallup News Service. Engineers 60 Such polls and information can be signifi- College teachers 58 Dentists 56 cantly biased and if individually reviewed can Accountants 41 be found wanting; however in view of the Bankers 34 need for trust in the capital markets to ensure Journalists 29 a stable environment for business growth and Business executives 25 development the position of accountants Congressmen 25 and business executives is disturbing. Senators 25 Auto mechanics 22 Certainly, the accounting profession has Stockbrokers 19 reacted to the unfavourable publicity with Lawyers 18 new guidelines and there have been many Labor union leaders 17 articles written about how certain practices Insurance salespeople 13 have been changed to ensure that proper Advertising practitioners 11 accounting procedures are followed. Source: Star Ledger, Newark, NJ, 17 February

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 products. Its purpose to a large degree has As these changes occur and as society 2 been to ‘create the soul’ of the corporation, as adjusts to the changing environment of busi- 3 noted by Roland Marchand. Marchand traces ness several serious complications have arisen. 4 the use by many corporations of advertise- The employee has become increasingly 5 ments that portrayed the corporation has hav- responsible for his own welfare. After some 6 ing a high moral value, and often linked small three decades of the government being res- 7 towns and the initial small businesses to their ponsible for the welfare of its people through 8 now hugeness in terms of hard work, artisan- such programmes as Social Security, Medi- 9 ship, and power. The purpose was to gain the care, welfare supports, pension regulation, 10 allegiance of the people across the country, and various laws affording the right to work to 1 and gain a presence in their community. a multitude of people, there has been a shift 2 Throughout this period the large corpora- in power back to the corporation. Many cor- 3 tions were gaining the position and status of porations have found that layoffs and labour 4222 real entities and the messages were designed reductions are greeted by a rise in stock price. 5 to support this growth and overcome the fears The adoption of ‘pay for performance’ for 6 of the general public that the corporation executive compensation seems appropriate at 7 lacked conscience. The efforts were initially to first glance and works well during a rising 8 demonstrate that ‘Victorian’ values were part business cycle. The link to stock price as being 9 of the corporations being paternalistic, linking an indicator of that performance has led to 20 their business to family and community executives acting at times only in the short- 1 (Marchand, 1998). term interest and can create some ethical 2 In the year 2002 much was written con- dilemmas during a business downturn. There 3 cerning the lack of accuracy in corporate has also been a transfer of the previously 4 financial reporting, as well as the attempts to corporate responsibility for health insurance, 5 hide unhealthy financial situations. There pension benefits and long-term employment 6 was a twenty-year period of deregulation of to the individual. The employee must now 7 corporations accompanied by almost the select the health care plan that best serves his 8 same period of continual growth in the econ- or her needs, and in most cases participate 9 omy and in corporate profits. It was a period financially in it on an increasing scale. The 30222 of great change in business operations and employee must maintain a skill level to 1 the technology supporting these businesses. maintain employment, often obtaining these 2 The advance of the computer, the internet, skills outside of the work environment. The 3 telecommunications and globalization of busi- employee in many situations has been given 4 ness served to accelerate the rate of change. the responsibility to manage their own retire- 5 While the accounting firms may have played a ment funding either through 401(k) pro- 6 significant part in reporting financial data, the grammes offering some degree of selectivity 7 corporate communication professional has and individual retirement accounts (IRAs) 8 certainly had a large part in the activity as from their own salaries. Gone is the paternal- 9 well. Some of the creative ways that losses istic approach to employees that was so much 40 are downplayed and that wordsmithing has a part of the business environment of thirty to 1 been used to cover detrimental news demon- fifty years ago. But often these very plans 2 strate how communication professionals have offered by the company are subject to invest- 3222 played their part. ment in the companies’ own stock. This is part

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors of the tragedy of Enron, that 90 per cent of We have only to witness Enron, Global the asset value of their 401(k) was in com- Crossing and the fall of the various ‘dot.com’ pany stock. Similarly, Lucent Technologies enterprises to observe that this is not the case. stock, which also lost 90 per cent of its value How many other companies are in the same due in large part to financial misrepresenta- situation or very close to it is an unknown. tion, comprised 70 per cent of its employees The ability to invest with any degree of cer- plan assets. tainty is dependent upon factual financial The deregulation of utilities and other information, delivered in a clear and compre- businesses has also brought to the consumer hensible format that is uniform and replicable an increasing need to take responsibility for across industries. This is the basis for the stock themselves. The choices in services have market and the development of valuation. never been so vast: what telephone service to There now exists an ‘investor class’ of 100 use? What electric, gas or other power million Americans. Over half of the adult provider should one select? Which bank to population of the United States has invested chose? What types of savings plans are best? in securities through direct investment in Who to invest with? These are all questions companies, through mutual funds or through that the everyday employee did not face their 401(k)’s. thirty years ago. Certainly with the events of Enron and During this time of rapid change there has Arthur Andersen much criticism has been been a continued acceptance that corpora- directed towards the accounting industry, but tions will do their reporting properly and fully. much must be directed towards the corporate Such actions are most important to a capital communicators as well. The annual reports, marketplace. Financial reports form the basis the quarterly reports, the press releases, of corporate valuation and as such become and speeches delivered all failed to reveal the the basis for investment and stock prices. problems and in fact may prove to have been It is important to remember that as the presented to cover up the problems. Not that responsibility for retirement was transferred these two entities are alone in taking any bad from the corporations to the employee the news and making it good news or failing to number of individual stock investors has risen bring any attention to it. to an all-time high. The need for confidence Thus the crux of the concern: ethics and the in the capital markets is essential to both corporate communication professional and employees, and ultimately to the corporations the reporting of financial data, and what if and the governments who depend upon anything can be done about it? investment (and taxes). To see what was being done in the educa- Taking all of the above into consideration tional process concerning ethics courses I demonstrates the importance that financial selected a number of universities offering reporting be beyond reproach. Both those advanced degrees in both accounting and within the corporations and their auditors communication (master’s programmes). must treat it as an awesome responsibility. I found that out of thirteen universities offer- However, with deregulation, increased coming advanced accounting degrees only one petition and the increasing pressure for better required an ethics course while of the twelve performance each quarter this has not always universities offering advanced communication been the case. degrees none made ethics a required course,

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Table 27.2 Business ethics courses 2 3 University Programme Ethics Ethics Other 4 required elective 5 University of Pennsylvania Wharton Yes No Accounting 6 University of Pennsylvania Annenburg No No Communication 7 University of Chicago MBA No No Accounting Stanford University MBA Yes No Accounting 8 University of Texas, Austin MBA No No Accounting and 9 communication 10 Seton Hall University MS No No Accounting 1 Seton Hall University MA No Yes Communication 2 Fairleigh Dickinson University MS No No Accounting 3 Fairleigh Dickinson University MA No Yes Communication NYU Stern MA No MS, accounting 4222 NYU Stern MA No No Communication 5 University of Illinois, Urbana MS No No Accountancy 6 Pace University MS No Yes Accountancy 7 Northwestern University MBA No No Accounting 8 Northwestern University MS No No Communication University of Southern Calif. MA No No Communication 9 University of Southern Calif. MA No No Accounting 20 Rutgers University MBA No No Accounting 1 Rutgers University MCIS No No Communication 2 Monmouth University MBA No No Accounting 3 Monmouth University MA Yes No Communication 4 Kent State University MS No No Accounting Kent State University MA No No Communication 5 University of Hartford MSPA No No Accounting 6 University of Hartford MA No No Communication 7 Baylor University MAc No No Accounting 8 Baylor University MA No No Communication 9 University of Kansas MAc No No Accounting University of Kansas MA No No Communication 30222 1 Source: Al Atkinson, personal research © 2002 2 3 but two did offer a course as an elective (Table also had a communication advanced degree. 4 27.2). When I reviewed the requirements for Additional help was obtained from the 5 these same institutions for their MBA pro- National Communication Association and 6 grammes I found that approximately 50 per the American Institute of Certified Public 7 cent had a course in ‘business ethics’ as a Accountants websites. 8 requirement. Does offering an ethics course or making it 9 Selection of schools was not scientiﬁc but a requirement have any effect on the actions 40 based on the ‘US News Annual Guide for of the participants at a later point in their life? 1 Graduate Schools (2001)’. I looked to per- That is an unknown. But certainly the concept 2 sonal knowledge of schools of communica- of making it a part of the curriculum for any 3222 tion, except where the accounting school advanced degree in business would at least

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors expose the student to some thought processes executives from being socially responsible or that could prove beneficial to them in the ethical. The law covering the corporation future. states ‘the directors and officers of a corpora- A survey done by Donald Morris and pub- tion shall exercise their powers and discharge lished in Business Ethics Quarterly, volume 11, their duties with a view to the interests of the issue 4 entitled ‘Business Ethics Assessment corporation and of the shareholders’. The Criteria: Business V. Philosophy – Survey very law that creates the corporate purpose, Results’ discussed several issues concerning distilled to its essence, says that the people differences when the courses were taught by who run corporations have a legal duty to the philosophy professors or by the business shareholders, and that duty is to make money. professors. This study defined and established Failing this can leave directors and officers assessment criteria and ranked various courses open to being sued by shareholders. (Robert based upon these criteria. What seems clear Hinkley, 2002). from this survey is that there is no over- MBA programmes often require ethics whelming sentiment among those teaching courses and corporations tend to have ‘codes business ethics that what they are doing is of conduct’ to which all employees are sub- attempting to educate people to be more ject. The view from the trenches is very differ- ethical. The primary exception to this relates ent, and it offers little comfort for senior to those who believe that if students can be executives who are trying to implement corp- educated to be more rational or logical (what- orate ethics programmes, for academics ever is intended by those terms) then they will developing philosophy-based approaches to act more ethically (Morris, 2001: 635). business ethics, or for those who hope that There is very little written about the role of communitarian values will soon take root in the corporate communicator and ethics and corporate soil. financial reporting. The ethics of financial A study, performed by Badaracco and reporting seems to be directed towards the Webb, which is based principally upon in- accountants only, yet much of the public depth interviews with thirty recent graduates perception of a corporation is based more of the Harvard MBA programme, revealed upon the corporate communicator than the several disturbing patterns. First, in many accountant. It is how the information is pre- cases, young managers received explicit sented that makes the difference. instructions to do things they believed were Nearly every corporation has corporate sleazy, unethical, or sometimes illegal. creeds, statements from CEOs as to their own Second, corporate ethics programmes, codes convictions, ethics hot lines, codes of conduct, of conduct, mission statements, hotlines and and other programmes in place to establish the like provided little help. Third, many of the ethical standards for the organization. the young managers believed that their com- There are many scholarly papers written sup- pany’s executives were out of touch on ethical porting ethics in business and suggesting how issues, either because they were too busy or to implement programmes to encourage because they sought to avoid responsibility. ethical practices. The reality of practice is Fourth, the young managers resolved the however somewhat different. dilemmas they faced largely on the basis of The very basis for a corporation’s existence, personal reflection and individual values, not corporate law, could be construed as to inhibit through reliance on corporate credos, com-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 pany loyalty, the exhortations of senior execu- require management to formally affirm quar- 2 tives, philosophical principles, or religious terly, instead of annually, that its disclosure is 3 reflection (Badaracco and Webb, 1995). complete and current. 4 The National Investor Relations Institute They recommend that companies that have 5 (NIRI) has taken an active role in suggesting off-balance sheet businesses disclose that 6 methods of improving how financial informa- information to investors in an aggregated 7 tion should be communicated. This action by form. Companies should consider broadly 8 NIRI is most welcome as they as an organiza- disseminating that information, preferably in 9 tion have recognized the importance of the a company news release and posted on the 10 ethical reporting of financial data. They have company’s website. The disclosure should 1 taken the courageous position of making the include the business purpose of the invest- 2 following recommendations. ment, what current or special charges were 3 Companies should help investors under- recorded to set up the entity, contingent lia- 4222 stand how a company makes money and it bilities, if any, and what the impact would be 5 should be communicated in plain English. on the earnings if they were consolidated. 6 Investors should know what the company’s As recently proposed by the SEC, com- 7 GAAP (generally accepted accounting prin- panies should report insider transactions on a 8 ciples) earnings are before being told that the current basis and there should also be current 9 adjusted earnings are on a pro forma basis. reporting of material compensation actions, 20 GAAP may not provide investors with a com- such as annual option grants, instead of wait- 1 pletely accurate picture of a company’s ing for the annual proxy to be published. 2 performance, but it is the best thing we have Companies should have formal ‘window 3 until a better system is created. periods’ that govern when insiders may buy 4 The SEC has recently called for an expan- and sell securities and the dates of those win- 5 sion of the MD&A (management disclosures dows should be published so investors know 6 and announcements). NIRI agrees with this. when they are. 7 Companies should explain in plain English Companies should be more aggressive in 8 what are the key factors that drive the com- educating employees regarding the benefits 9 pany’s business, what significant trends exist and risks of owning the company’s stock 30222 that could impact the company’s performance (Thompson, 2002). 1 going forward, and other key factors that NIRI is a professional association of corpor- 2 affect the company’s business both on a his- ate officers and investor relations consultants 3 torical and prospective basis. When com- responsible for communication among corp- 4 panies notice a significant change in one or orate management, the investing public and 5 more or these factors, they should consider, the financial community. With over 5,000 6 on a current basis, disclosing that information members in 35 chapters around the United 7 broadly to investors. States, NIRI sets the highest standards in edu- 8 The SEC should examine whether the cation designed to advance the practice of 9 ‘Management Responsibility for Financial investor relations and meeting the growing 40 Reporting’ section of the annual report (Form professional development needs of those 1 10-K) should cover all written disclosures. engaged in the field. 2 Whether it should be required instead of Based upon the material available and the 3222 optional as it currently is, and whether to pressures being applied by regulatory processes

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors and the understanding that ‘trust’ in the capi- links between government enforcing regula- tal markets is essential to continued invest- tions and the amount of monies being spent ment and growth I believe some steps will be on the political scene is disturbing. The ten- taken to improve the quality of financial dency to move towards influencing legislation reporting. This offers a unique opportunity to to limit exposure from suits brought due to the the corporate communicators to utilize their failure to provide accurate accounting by the talents: informing their stockholders as to what very companies being paid to provide this their companies do and how they make accounting is cause for concern in itself. money, as well as the opportunities open to From what I have found to date there has those who invest in those companies. Perhaps not been much study performed in this area. too it is time to support the change in the law It is most complex and almost confessional in that creates corporations. A possible addition nature. It may be that additional emphasis to the phrase ‘the directors and officers of a needs to be placed on this topic during corporation shall exercise their powers and courses. But in reality the corporation needs discharge their duties with a view to the inter- to reaffirm the importance of honesty and ests of the corporation and of the sharehold- propriety in its dealings with its employees ers’ to include ‘but not to the expense of the and the public at the highest executive levels environment, human rights, the public safety, to truly make a change in current practice. the communities in which the corporation The role of the corporate communicator operates or the dignity of its employees’ remains challenging. There will continue to be (Hinkley, 2002). While such a step is doubtful, a requirement to ‘soften’ or ‘control’ the effect certainly the need to ensure that corporate of ‘bad’ news whether financial or otherwise. reporting does not undermine the very foun- There will continue to be pressure to create dation of corporate investment upon which the perception that all is fine even when it is the market place relies is essential. not. There is a strong probability that the The attempt to control the accounting accounting profession will have some degree industry by making it responsible for its of regulation that, if enforced, will require actions has led to an increasing number of more appropriate disclosure of the facts. But lawsuits over the past several years, and has I would be most surprised to see any such also led to a significant increase in political regulation providing any direction for the donations from major accounting firms. The corporate communication professional.

REFERENCES

Gibson, D. (2002) ‘Object of devotion’, Star Ledger, Morris, D. (2001) ‘Business ethics assessment criteria’, 17 February. Business Ethics Quarterly, 11(4), 623–50. Hinkley, R. (2002) ‘How corporate law inhibits US News (2001) US News Annual Guide for Graduate ethics’, Business Ethics, January–February, 4–5. Schools, New York: US News. Marchand, R. (1998) Creating the Corporate Soul, Berkeley, CA: University of California Press.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 RECOMMENDED FURTHER READING 2 3 Badaracco, J., Jr and Webb, A. (1995) ‘Business Thompson, L. Jr (2002) ‘Statement before the SEC 4 ethics’, California Management Review, 37(2), Financial Disclosure and Audit Oversight Round- 5 8–28. table’, 6 March, Washington, DC. 6 Dugan, I. (2002) ‘Before Enron, greed helped sink the 7 respectability of accounting’, Wall Street Journal, 14 March. 8 9 10 1 2 3 4222 5 6 7 8 9 20 1 2 3 4 5 6 7 8 9 30222 1 2 3 4 5 6 7 8 9 40 1 2 3222

Richard R. Dolphin

International public relations (iPR) is recognized as one of the most rapidly growing areas of public relations but perhaps one of the least understood. In this chapter the author looks at the issue of international public relations from the perspective of an empirical study conducted by the author in British organizations focusing on the role of international public relations within a co-ordinated marketing communication strategy. He addresses the management of the relationship between organizations and those audiences overseas who might be considered signiﬁcant international stakeholders as key variables in iPR.

Pavlik noted some twenty years ago, that ing to Culbertson and Chen (1996), iPR has international public relations (iPR) was one spread rapidly throughout the world; and of the most rapidly growing areas of the pro- Taylor (2001) suggests that for practitioners fession – and one of the least understood. the desire for competency in the skills neces- The chairman of one of the largest PR ﬁrms sary for the successful execution of iPR grows entitled his introduction to the 1999 ICO yearly. Taylor and Kent (1999) suggest that summit ‘Public Relations – truly a global busi- further knowledge about iPR is important in ness’ (Hehir, 1999). Comor (2001) suggests order to explore the assumptions underlying that a central pillar in this growth is the recent differing national practices; and to examine explosion of electronic forms of transnational differing practices worldwide. communications. Although Botan reported in 1992 that 130 Scholars of management are hampered by articles had been published on iPR, the pre- the lack of an established body of knowledge sent body of scholarly knowledge makes only about the ﬂedgeling domain of iPR – and cursory reference to the world outside Europe of practice in different parts of the world and to the United States in particular (Krishnamurthy and Dejan, 2001). But, accord- (Krishnamurthy and Dejan, 2001). Taylor and

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 Kent (1999) suggest that detailed introspec- used PR for nation building – but is slowly 2 tion may persuade PR practitioners that many shifting to a new focus on market develop- 3 of the assumptions guiding western public ment. 4 relations are simply not applicable to the grow- Grunig et al. (1995) noted that most of the 5 ing field of iPR. conditions that foster professional PR in the 6 It becomes increasingly critical to assess United States may not exist in (and around) 7 ways in which PR professionals can prepare organizations in other countries; so, perhaps, 8 themselves to meet the growing challenges of professionals practise different models of 9 communicating with publics of various coun- public relations elsewhere in the world. Al- 10 tries and cultures (Krishnamurthy and Dejan, Enad (1990) suggested that the forces behind 1 2001). Perhaps not surprisingly one of the the evolution of public relations in western 2 most interesting trends in recent years has societies were not always found in developing 3 been the growing use of professional PR con- countries. He questioned why, therefore, 4222 sultants by national governments (Manheim public relations is needed in such cases and 5 and Albritton, 1983); Schuybroek noted in asked if professionals may be employing 6 1999 that there were at least fifteen PR net- models that may or may not be effective in the 7 works offering these services worldwide. countries in which they are used. 8 Kruckeberg and Starck suggested (1988) Sriramesh (1992) found that most Indian 9 that the practice of iPR offers an active respondents defined public relations as pub- 20 attempt to restore and maintain a sense of licity; while Grunig et al. (1995) found that 1 community in an increasingly global world – a Greek practitioners see public relations as 2 world where communities become by the day primarily focused on image building. Lyra 3 ever more disparate and fragmented. PR prac- (1991) reported that many Greek practition- 4 titioners have a social responsibility to under- ers paid media contacts to place news stories! 5 stand and respect the concerns of the diverse In other countries, Russia for instance, the PR 6 populations with which they communicate profession has only recently begun to evolve 7 (Guzley, 1995): therefore mutual understand- into a recognizable structure (Guth, 2000); 8 ing is needed between organizations and although interest there in public relations does 9 international publics (Taylor, 2001). continue to grow. 30222 Public relations only crossed the ocean and 1 became accepted as a management tool in 2 Europe after the Second World War (Vercic Global – or international? 3 et al., 2000). But third world public relations is 4 largely a communication, information gener- There is little consensus about whether it is 5 ating function; not a management function realistic to talk of the existence of a truly inter- 6 (van Leuven and Pratt, 1996). However, national, let alone global, model of PR best 7 Kruckeberg (1996) reports that sophisticated practice (Moss, 2001). But, almost all the PR 8 public relations is being practised in the theory building activity centres in the United 9 Middle East; an emphasis on management States or in a few western European countries 40 function that reflects the original association (Krishnamurthy and Dejan, 2001). Some 1 of iPR with business (Zaharna, 2000). Taylor scholars question whether public relations 2 and Kent (1999) relate that since Independ- can be practised in a similar way in different 3222 ence in 1963 the Malaysian government1 has countries or whether localized approaches are

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors necessary (Grunig et al., 1995). For instance 2 environment; Taylor and Kent (1999) report that public re- 3 societal culture; lations in Asia is often influenced by Eastern theology and hierarchic relationships. that might impact upon iPR practice. Some refer to iPR as globalization (Zaharna, In 1992 Baskin and Aronoff suggested that 2000); referred to by Hill and Knowlton’s iPR has three main functions: CEO as one of the most important changes 1 representing a corporation in its home affecting the function of public relations today market; (Mellow, 1989). Botan (1992) discussed 2 bridging the communication gap between ethnocentrism – which in public relations is foreign management and home manage- the belief that what is known about it in one ment; country is applicable across all countries. 3 facilitating communication in the host In 1989 Wilcox et al. defined iPR as the country. planned and organized effort of a company, institution or government2 to establish mutually beneficial relations with the publics of other Target audiences nations. Anderson (1989) used the terms global and international to distinguish between The general public is not always the target of public relations practised in the same way public relations (Taylor and Kent, 1999). throughout the world and public relations cus- Overseas government officials may be the tomized for each culture. focus (Haug and Koppang, 1997); such a re- Differentiated does not necessarily mean lationship will influence the practice of public that messages have to be altered wholesale; relations (Taylor and Kent, 1999). Taylor and they can be adapted to appeal to identified Kent suggest that in the developing world customer needs (Kitchen and Wheeler, 1999). those who control access to scarce resources In endorsing a strong version of the global may be a key public. approach, Sharp (1992) noted that the principles regarding what PR is – and can do – remain the same worldwide. Botan (1992) came to the Key management role opposite conclusion. Grunig et al. (1995) suggest that emerging from the merits of two Since the 1970s, public relations has matured extreme positions seems a consensus that the within the advanced western economies into a ideal model for iPR lies somewhere in the modern, sophisticated management function middle. (Moss, 2001). It continues to evolve as a Synnott and McKie (1997) suggested that strong discipline (Krishnamurthy and Dejan, the political system in a country might well 2001) playing a key role in the success of influence that country’s perception and use of many organizations with a well developed PR; while, Krishnamurthy and Dejan (2001) local body of knowledge – in both Europe and propose three factors of the relevant country: Australia in particular (Moss, 2001). Botan (1992) discussed PR functions, roles 1 infrastructure: political system, economic and goals and how they vary between coun- development, level of activism, culture tries; while Van Leuven and Pratt (1996) and media environment; identified variations deriving from:

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 • communication infrastructure; and this has, by and large, to be done through 2 • market economy; unproven means (Kruckeberg, 1996). The 3 • political stability; computer has become central to PR activity 4 • linguistic/cultural integration. and the global potential of the internet sug- 5 gests more intercultural activity (Neff, 1998). 6 Interactive communication technologies 7 Unchanged role are providing groups and individuals with 8 unprecedented capacities to form meaning- Moss (2001) suggests that in many parts of 9 ful transnational networks (Comor, 2001). The the world public relations remains wedded to 10 rapid expansion of communication tech- its publicity origins. But, Krishnamurthy and 1 nology has increased the dissemination of Dejan (2001) suggest that, in political systems 2 information (although the level of develop- that do not value public opinion, PR tends to 3 ment of a country’s infrastructure vastly influ- be propagandist (although Al-Enad (1990) 4222 ences a practitioner’s ability to plan and questions whether government institutions 5 implement communication programmes). in authoritative societies care about public 6 This rapid increase in international communi- opinion). 7 cation through emergent IT is putting PR prac- However, Krishnamurthy and Dejan note 8 titioners at the forefront of managing that varying stages of democratization offer 9 relationships with peoples of varied nations different opportunities and challenges to PR 20 and cultures (Krishnamurthy and Dejan, professionals. They suggest that the western 1 2001). definition of public relations assumes a demo- 2 cratic political structure where competing 3 groups seek authority and legitimacy through 4 Culture the power of public opinion. 5 International PR practitioners must under- 6 Taylor and Kent (1999) suggest that detailed stand the extent of media outreach3 in coun- 7 introspection may well persuade PR practi- tries where they operate. But that media may 8 tioners that many of the assumptions guiding not provide an effective means for wide dis- 9 western PR are simply not applicable to the semination of organizational messages in 30222 growing field of iPR. Taylor (2001) suggests every country. 1 that it is important to remember that iPR is In developing countries the media reaches 2 always intercultural PR. a fairly homogenous small segment of the 3 Intuitively, one would posit that different total population; accordingly, in order to 4 cultures would require different PR theories reach the largest populace the iPR consultant 5 and practice (Kruckeberg, 1996). In arguing will have to think of other media that reach 6 that cultural distinctions among societies must out to untapped publics (Krishnamurthy and 7 affect the way that PR is practised within those Dejan, 2001). 8 societies Sriramesh and White (1992) lend 9 credence to this assumption. 40 IT impact Kruckeberg (1996) notes that when they 1 practise beyond their borders western PR 2 Among PR practitioners, increasingly complex practitioners face an extreme range of cul- 3222 relationships must be nurtured satisfactorily; tures; and that they will be challenged by

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors culture-bound perspectives and assumptions. Communication influences, and is influenced North American scholars Howard and by, culture. As Krishnamurthy and Dejan Mathews (1986) noted that the astute practi- (2001) note, it behoves scholars of iPR to tioner recognizes that competence in the study how the cultures of individual countries United States does not necessarily translate to affect the choice of PR strategies in those competence in other countries. countries. Albert (1992) argues that in today’s For instance, Kruckeberg (1996) reports, organizations the term polycultural may be Muslim culture heavily influences much more appropriate than multicultural. She pro- Middle Eastern practice; while Gunn (1994) poses that while multicultural has been used points to the strong influence of Bhuddism in primarily to designate activities involving Thai society – an influence that clearly affects minority groups polycultural refers better to the form of PR practice in Thailand. Guth multiple cultures. (2000) notes the likelihood that Russian Vasquez and Taylor (2000) propose that public relations will emerge with a distinct Botan (1992) captured the inherent paradox flavour reflecting the unique culture of that of the struggle to understand culture as a PR nation. Accordingly, Taylor (2001) refers to a variable. His observation was that the very real need for cross-cultural sensitivity from PR practices that enable western scholars to understand public relations in Japan and specialists. Scholars can look for parallels western Europe might actually blind us from between their own culture and the host cul- seeing other enlightening practices. ture for shared similarities and potential differences. Such cultural knowledge may be used to develop campaigns that creatively Media relations incorporate features unique to a particular culture (Zaharna, 2000). Before they are able to develop strategies for Two fields that appear on the surface to conducting effective media relations in any have little in common are intercultural com- particular country, iPR practitioners must munication and iPR. While intercultural com- understand how the media operate – and munication has its roots in the academic field who controls media content in that particular of anthropology iPR is very much a product country (Krishnamurthy and Dejan, 2001). of a practising profession (Zaharna, 2000). Sriramesh (1992) reported that in India many However, beneath the surface both are public information campaigns used folk concerned with how culture influences com- media (such as dances and skits) and that munication. some multinational corporations might want Culture was seen as important, guiding to follow the same strategy to communicate with various publics. three critical variables in communication:

1 verbal communication (Moss et al., 1997 International strategies note that one aspect of culture, relevant to its relationship with public relations, is Krishnamurthy and Dejan (2001) report a language); number of academics having proposed the 2 non-verbal communication; formulation of global PR practices; for inter- 3 perception (Zaharna, 2000). national marketing4 implies that marketing

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 must be co-ordinated across nation states. request. Twenty-one (87.5 per cent) agreed to 2 Kitchen and Wheeler (1999) suggest that participate in the research.5 Of those organiza- 3 Coca-Cola, McDonald’s and Levi’s are exem- tions interviewed only 45 per cent were 4 plars of the new global philosophy – corpora- involved in iPR; so the findings of this initial 5 tions who operate with resolute constancy as investigation are indicative. The findings sug- 6 if the world was a single large identical entity. gest that more research is needed; but are not 7 The question is especially important for multi- conclusive. Of those communicators involved 8 national organizations (Grunig et al., 1995); with iPR some are not engaged all the time; 9 but Budd (2001) reports that even Coca-Cola, for example, the bank spokesman com- 10 pinup of a global brand, now advises think mented I deal with iPR when it touches on corp- 1 local, act local, versus its old slogan, think orate reputation. 2 global, act local. However, 100 per cent of those who do 3 practise iPR use the same techniques to communicate with audiences overseas as they use 4222 Issues management 5 at home; none adopted a specific set of com- 6 Tixier (2000), in a survey of large Australian munication techniques for an overseas con- 7 corporations, noted a major change facing stituency. The communication executive at the 8 communication specialists, the growing inter- tobacco company noted that the techniques 9 nationalization of issues identification. Budd are the same. 20 (2001) notes that the velocity of events sug- All respondents – whether they were 1 gests the creation of an internal directorate involved in iPR or not – agreed that globaliza- 2 charged with monitoring, assessing and tion is one of the big communication issues 3 reporting on trends in those parts of the world today; one likely to impact increasingly on 4 pivotal to the company’s interests. communication practice. The consensus is that 5 the approach (suggested by Anderson, 1989) 6 that iPR involves communication customized 7 Ethics for each culture is probably the way ahead. 8 The communicator for the pharmaceutical 9 Taylor (2001) suggests that issues of ethics organization (with satellite organizations 30222 have growing importance in international worldwide) remarked we communicate subtly 1 situations. Kruckeberg (1996) proposed that different messages to our companies around the 2 (as between a third world country and one in world: while the rubber company spokesman 3 the west) corresponding PR ethics in (say) the commented we have to translate into four lan- 4 Middle East, would be substantially different guages. 5 from those embraced in a first world country. The recommendation from Grunig et al. 6 Of course, ethics and legal issues need to be (1995) that localized approaches are neces- 7 considered in the context of Islamic theory sary was confirmed by 75 per cent of res- and Arabic law. 8 pondents; a drugs company spokesman noted 9 that he spent a lot of time ensuring the con- 40 The research sistency of the messages – orchestrating them 1 – making sure that they all work together inter- 2 Twenty-four organizations were approached nationally. This remark was made in the con- 3222 through personal contact or by written text of responsibility for a wide range of

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors audiences; in addition to communicating in a with suppliers in countries as diverse as those wide range of countries. in continental Europe, Mexico, Portugal, The spokesman for Scotland’s largest China and India. A high street retailer (one brewer of lager – with responsibility for a having recently disposed of a subsidiary with brand exported to most corners of the globe – offices in United States, Africa and India) com- noted we deal with particular publics in dif- mented until three years ago I was responsible ferent ways. This tends to suggest that the for public relations in those countries; approach taken by Kitchen and Wheeler and referred to cultural differences between (1999) to adapt messages to appeal to identi- suppliers in all of them. fied customer needs is the one widely As noted, Krishnamurthy and Dejan (2001) adopted. As the Scottish brewer remarked we see iPR emerging as a strong discipline with adopt a different emphasis where necessary. He a key role to play in corporate strategies. gave his company’s launch of canned The rubber company – an organization with Tennent’s Lager in China (where Bass have a developing interests in Mexico, in particular – joint venture) as one example where this had commented that not only was iPR difficult; been done. he elaborated that it was still developing. There is some evidence to support the This spokesperson referred to the growing views of Baskin and Aronoff (1992). The number of factories opened by his organiza- organizations interviewed all use public re- tion around the world. He noted we now have lations to represent their corporations in the more factories outside the United Kingdom than home market and lead their company’s efforts within it (the bulk being in the United States to bridge the communication gap between and Mexico) and discussed the challenges pre- foreign management and home management. sented by this new communication phenome- The communication executive at the pharma- non. Talking of the need for more local ceuticals group commented I provide strategic spokespeople he said we need people on the leadership for the group and would manage seri- ground as foot soldiers. ous international issues. The spokesman for the Even a high street retailer – better known airline specifically referred to his responsibility for its roots in Nottingham than in New York – for facilitating communication in his host referred to the fact that he gets involved in country. Referring to the US market – one of international issues from time to time and spoke great importance to his company – he told the of his need to deal with international groups, researcher that his company employed almost politicians and media. fifty staff in their New York office – all of Ovaitt (1988) suggested that iPR pro- whom were American – and all of whom were grammes might share strategic elements even journalists. A specific approach, he explained, if the strategies are implemented in different because his organization wished to convey ways in different countries; and according to appropriate messages and themes to audi- differing economic and political infrastruc- ences in that country. tures. Van Leuven and Pratt (1996) argued Overseas players spoke to the researcher that economic and political factors might about the varying challenges facing them impact on iPR programmes. This is confirmed abroad. They discussed the differing profiles by this research. Sixty per cent of the organ- of international audiences. The rubber com- izations interviewed communicated with pany spokesperson talked of communication audiences in third world countries; as well as

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 those in the first world. All referred to the var- who, at the time that the researcher visited it, 2 ious ways in which differing national infra- had engaged consultants to assist them with a 3 structures impact upon iPR programmes. spat in India. The spokesman referred to how 4 As noted, Krishnamurthy and Dejan (2001) little he used consultants generally; but found 5 suggested that in some countries iPR tends to them useful in overseas markets; and giving 6 be propagandist. This research does not sus- the Indian example said I have retained a PR 7 tain this suggestion. One hundred per cent of consultancy to handle it. Clearly, increasing use 8 respondents stated categorically that they saw of IT – where the infrastructure has been 9 no part of their communication role involved developed – helps enormously. 10 with any sort of propaganda anywhere – All organizations with international oper- 1 either at home or abroad. Neither was the ations spoke of the challenges presented by 2 issue of media outreach one of concern to the need to produce iPR programmes in a 3 those interviewed. On the other hand, all context of cultural and societal distinctions; 4222 international interviewees were significant and all but two confirmed that these 5 global players communicating either with inevitably affect the way that iPR is practised 6 satellite divisions abroad or with sophisticated within widely differing societies. As the telco 7 publics; so this response might have been spokesman remarked of the international 8 expected. communicator he must know his audience. One 9 An example of the methods used to reach point made by the global airline was that 20 sophisticated audiences overseas was given by these cultural differences are as apparent in first 1 the pharmaceutical organization. The spokes- world countries like Canada, the United States 2 person mentioned the academic publications and Australasia as they are in more remote 3 produced by his organizations and circulated parts of the globe. 4 worldwide – worldwide, internationally driven The airline spokesman agreed with the aca- 5 he remarked – which, he indicated, were a demic who noted that the astute practitioner 6 communication vehicle used to influence im- recognizes that competence in the United 7 portant research audiences around the world. States does not necessarily translate into com- 8 Twenty-five per cent of respondents do petence in other countries; speaking of his 9 business around the world on a daily basis. carefully chosen US media team, he explained 30222 Each confirmed that the computer has that this was the reason that he only em- 1 become central to their iPR activity, as Neff ployed locally trained journalists. 2 (1998) thought probable. Organizations like Both the rubber and the pharmaceutical 3 the rubber company manufacturing tyres in companies – between them having divisions 4 Mexico and the tobacco firm selling its prod- in most parts of the world – spoke of the 5 ucts in India reported that they mainly used need for communication programmes that 6 technology for communicating with employ- demonstrate a distinct flavour; one honed to 7 ees. Evidence from the airline was that IT is reflect the national characteristics of the coun- 8 being used increasingly to address local audi- try in which they are transmitted. The bank 9 ences with marketing PR messages – the US spokesman – fronting communication pro- 40 audience being one very obvious example. grammes for an organization with long associ- 1 The ability to communicate quickly with ations in South America – confirmed Taylor’s 2 external consultants used abroad was also (2001) suggestion of a real need for cross- 3222 given; particularly by the tobacco company cultural sensitivity from iPR specialists.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors All respondents agreed that knowledge of Discussion local audiences must be built into iPR campaigns; to reflect a sensitivity of cultural fea- The findings suggest that those British organ- tures unique to audiences in the target izations with significant overseas trading inter- country. One hundred per cent of respondents ests do set out to achieve – and to maintain – agreed that a deep knowledge of how local a sense of community with those stakeholders media works in individual countries is of cru- perceived to be crucial to their organizational cial importance and, indeed, may result in the success around the world. Initial indications success or failure of an iPR campaign. The air- from this research are that British communica- line’s American experience has been noted tion executives are aware of their social already. Other organizations (the pharmaceu- responsibility to understand and respect the tical company, the international bank, for concerns of the diverse populations with instance) explained that one reason why they which they communicate. occasionally engaged overseas consultants to On the other hand, it is noteworthy that deal with iPR was specifically because of their only a small cross section of British organiza- sophisticated knowledge of local markets and tions seek to communicate internationally; their media. and of those that do so only a small sample The finding of this chapter is that British communicate full time; some, like the bank organizations trading internationally believe (with very long established interests in mar- that think local, act local is the right approach to kets as diverse as New Zealand and South adopt when communicating internationally. It America) being involved in iPR from time was summed up well by a national retailer to time. with operations overseas – local public relations A debate is noted concerning the use of is handled locally – he said that this was so in different techniques for communicating in dif- order that a local message could be produced. ferent cultures; but all those interviewed No evidence was given to the researcher by believed in the value of using the same tech- anyone interviewed that any effort was made niques in whatever area they communicate. to impose a transglobal message. The researcher reflected and wondered if this In sectors as controversial as the tobacco was because all the companies concerned had industry, the financial services sector or the air- very large operations overseas – or could it be line business it is no surprise that the role of because they were using a tried and tested the corporate communicator has expanded set of techniques – and that if it worked, don’t increasingly – and now embraces international fix it? environmental scanning. The telco spokes- The debate proceeds and concerns the person referred to being the eyes and ears of his message. Should the message be the same organization – increasingly using modern tech- (noting one company translating its message nologies – observing issues that might impact four times – might something be lost in trans- upon his organization. The rubber company lation?)? Should it be a specific message for a spokesperson spoke of the challenges of spot- specific audience (favoured by an airline for ting future problems in countries as diverse as its US audience) or should the message be Mexico and China; the airline spokesperson subtly different (favoured by the pharma- echoed this, highlighting that a global airline ceutical company and by the Scottish brewer, needed to scan globally. who referred to favouring a different empha-

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 sis where necessary)? No one seems sure. country plant. Perhaps this suggests that com- 2 What does seem certain is that orchestration is pany spokespeople require special training for 3 needed to ensure that nuances and subtle iPR? Maybe this is the case – the company 4 differences are brought together to ensure concerned now has more operational plants 5 an internationally integrated communication outside the United Kingdom than within it. 6 programme. No easy task, the researcher Perhaps the challenge gets bigger when 7 surmises. differing socio-economic infrastructures are 8 One aspect struck the author of this chapter. considered, and when one reflects on the need 9 Even when an organization is involved in little for international companies to communicate 10 international communication; even where with audiences at macro level; particularly 1 overseas consultants would normally be governments. The researcher felt that, how- 2 brought in to sort out a problem locally; the UK ever experienced the practitioner, they might 3 practitioner regards him/herself as communica- find their expertise stretched by having to 4222 tor in chief; and normally becomes involved if communicate with such widely diverse audi- 5 the matter is serious. The communicators from ences sometimes in far-flung places. 6 the pharmaceutical company, the high street There is no disputing the view of some 7 chemist, the tobacco company – all made the management scholars that in some countries 8 same point – and strongly – they would become public relations may be viewed as a propa- 9 involved. Further, the tobacco spokesman made ganda exercise. Equally beyond dispute is 20 it plain that no one but the communication that not one of the British organizations inter- 1 executive would speak for the company. viewed considered themselves involved in 2 The one organization that took the local propaganda – either at home or in any coun- 3 message really seriously was the global airline. try abroad; all rejected the idea. In fact, on 4 Perhaps the success or failure of a British-based the opposite side of the spectrum, there is the 5 global airline depends heavily on audiences evidence of one global organization – with a 6 overseas – none more so than that in North huge international communication oper- 7 America. But the author was impressed by the ation – investing a seven figure sum publish- 8 media organization that this organization had ing academic research as a contribution to 9 set up in New York and by the number of local global debate and scientific advancement. 30222 staff it employed. The airline, it struck him, Not propaganda. 1 was out to send the correct messages: and to In an age when even a one-person business 2 communicate them in a way that would be can become an international concern the need 3 understood by local publics communicating in to be able to communicate globally acceler- 4 American rather than English! ates by the day – and with some velocity. The 5 Clearly, British communicators regard iPR evidence from this research is that e-PR is seen 6 as a challenge – recognizing that messages by large British organizations as a useful tool; 7 need to be tailored for the local audience and but the researcher uncovered no evidence that 8 communicated in a manner that will achieve it has yet replaced traditional communication 9 the desired results. One spokesman empha- channels. Likewise evidentially external con- 40 sized that communicating to countries as sultants are engaged when they add value; 1 diverse as Mexico, India, China and Portugal helping with cultural issues or because the 2 was a demanding exercise for someone who organization does not have its own PR people 3222 had started off as a press officer in a west in a particular country (witness the rubber

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors company needing more foot soldiers in Mexico does, however, seek to add to the body of and elsewhere). Significantly, the typical UK knowledge concerning international com- based communication executive regards his or munication grounded in the British experi- her role very much as hands-on – getting ence; and to provide fresh insights. involved overseas if needed. The first conclusion is that a minority of The underlying theme running through this British organizations are involved in iPR on a chapter is that British practitioners are very regular basis. Those that are recognize that it is much aware of cultural sensitivities and lan- problematical. Apparently they do, by and guage differences. They recognize increasingly large, take into account the difficulties pre- that communication across nations does need sented in communicating across diverse fron- to take into account the audience to whom it tiers; and in the context of different cultures, is addressed – as noted, giving a distinct social norms and, sometimes, religious back- flavour honed to national characteristics; grounds. demonstrating a knowledge of local audi- Kitchen and Wheeler (1999) noted the ences (presumably this is where the local foot debate concerning the co-ordination and con- soldiers come in); acknowledging that there trol of international campaigns – the key issue has to be a choice of PR strategies appropriate being whether campaigns should be standard- to different countries (Krishnamurthy and ized or adapted locally. Clearly, the British Dejan, 2001). communication executive recognizes that if One area of the literature that seems fairly there is a major problem (s)he becomes thin concerns the use of iPR for global involves and – in doing so – uses much the environmental scanning. The finding of this same techniques as would be used at home – chapter is that in controversial industries albeit adapted to fit local conditions. (tobacco, financial services, perhaps alcohol?) For many British communicators the iPR a primary task of the international communi- role may be very much a part-time involve- cator in-chief is international issues management. But, in an age of global markets and ment. The importance of this role should not instant communication – ones that are acceler- be underestimated; note the telco spokesman ating by the day – any communicator in any seeing his role as the eyes and ears; a task organization needs to be able to communicate transglobally that has quite frightening impli- – and to do so fast – and to do so with compe- cations. One even questions to what extent it tence – with any – and diverse – stakeholders might be feasible? anywhere. In today’s global economy any spokesperson may find themselves communicating directly with an audience in any corner Conclusion of the globe – dealing with problematical languages, diverse and puzzling cultures, discon- The importance of this chapter is that cur- certing religious influences; the list is endless. rently only a handful of studies exist that help This is a new and challenging frontier for to build a body of knowledge of iPR today’s communication executive – but it is a (Krishnamurthy and Dejan, 2001). Of these, challenge from which, if the practitioner is suc- few have been written in the British context. cessful, great strategic advantage may be However, because of its small size this regained for the organization; and on an inter- search makes no claims to be conclusive. It national platform.

© 2004 Sandra Oliver for editorial matter and selection; individual chapters, the contributors 1222 APPENDIX 2 3 The identities of these organizations 4 5 Asda plc Northumbria Ambulance NHS Trust 6 Avon Rubber plc J. Sainsbury plc 7 Avon and Somerset Constabulary W. H. Smith plc 8 BAT Industries South Western Electricity plc 9 Boots Group plc Storehouse plc 10 British Airways plc Tennent Caledonian Breweries Ltd 1 British Telecommunications plc Vaux Group plc 2 GlaxoWellcome plc Wessex Water plc 3 Lloyds TSB plc Whitbread plc 4222 London Transport Yorkshire Tyne-Tees plc 5 Wm Morrison plc 6 7 8 NOTES 9 20 1 Which controls the media. 3 The extent of media saturation in a society. 1 2 Kruckeberg (1996) notes Al-Enad reporting that 4 Not as Anderson (1989) sees it. 2 PR practice has been sometimes exploited by 5 See appendix. 3 some third world governments. 4 5 REFERENCES 6 7 8 Albert, R. D. (1992) ‘Polycultural perspectives on Comor, Edward (2001) ‘The role of communication in 9 organisational communication’, Management global civil society: forces, processes, prospects’, 30222 Communication Quarterly, 6, 74–84. International Studies Quarterly, 45, 389–408. 1 Al-Enad, Abdulrahman (1990) ‘Public relations roles Culbertson, Hugh M. and Chen Ni (1996) Inter- 2 in developing countries’, PR Quarterly, spring, national Public Relations: A Comparative Analysis, 3 25–26. Mahwah, NJ: Lawrence Erlbaum Associates. Anderson, G. (1989) ‘A global look at public re- Grunig, James E., Grunig, Larissa A., Sriramesh, K., 4 lations’, in B. Cantor (ed.), Experts in Action: Inside Huang Yi-Hui and Lyra, Anastasia (1995) 5 PR, 2nd edn, New York: Longman. ‘Models of public relations in an international 6 Baskin, O. and Aronoff, C. (1992) Public Relations: The setting’, Journal of Public Relations Research, 7(3), 7 Profession and the Practice, Dubuque: Wm. C. 163–86. 8 Brown. Gunn, J. (1994) ‘Environmental public relations: con- 9 Botan, C. (1992) ‘International public relations; cri- sultancy practice in Bangkok’, unpublished BSc tique and reformulation’, Public Relations Review, dissertation, Bournemouth University. 40 18, 149–59. Guth, David W. (2000) ‘The emergence of public re- 1 Budd, John F. (2001) ‘Opinion . . . foreign policy lations in the Russian Federation’, Public Relations 2 acumen needed by global CEOs’, Public Relations Review, 26(2), 191–207. 3222 Review, 27, 123–34. Guzley, Ruth M. (1995) Review of Banks, Stephen. P.

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