CCI Leaders Forum 2015: Module 7 -- Corporate ...€¦ · ... Corporate Communication: Critical...
Transcript of CCI Leaders Forum 2015: Module 7 -- Corporate ...€¦ · ... Corporate Communication: Critical...
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CORPORATE COMMUNICATION INTERNATIONAL at Baruch College/CUNY
CCI Leaders Forum 2015:
Module 7 -- Corporate Communication:
Critical Business Asset for Strategic
Global Change
Dr. Michael B. Goodman
Professor
Director, MA in Corporate Communication
Director, Corporate Communication International
January 2015
Corporate Communication:
Critical Business Asset for
Strategic Global Change
Michael B. Goodman
&
Peter B. Hirsch
NY: Peter Lang, 2015
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Chapter 1 – Communication and Transformation
in the Global Corporation
This chapter explores corporate communication as both
a strategic management function and a strategic
process in corporations.
To understand how radical changes in business and the
media have influenced the practice of corporate
communication, this chapter examines those changes
themselves – globalization, the Web, the Networked
Enterprise, uncertainty, privacy and “big data.” …
This framework enables us then to analyze the role of
corporate communication and how it should be defined
in order to address how the forces described here have
shifted the context of corporate communication.
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Sidebar 1.1 The Corporation
Defined (1)
The form of the modern business corporation originated
in a fusion of the type of commercial association known
as the joint-stock company, which was in fact a
partnership, and the traditional legal form of the
corporation as it had been developed for medieval
guilds, municipalities, monasteries, and universities.
Although business corporations were formed in England
as early as the 16th century, these enterprises were
monopolies chartered by the crown for the pursuit of
strict mercantilist policies and were thus closer, in some
respects, to the form of the modern public corporation
than to that of the private business corporation.
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Sidebar 1.1 The Corporation
Defined (2)
The fusion of the two forms took place incrementally
over the first two-thirds of the 19th century in Great
Britain, the United States, France, and Germany with
the passage of general incorporation laws, which
gradually made incorporation a more or less routine
matter for business enterprises…
As corporations increased in size and geographic
scope, control of the enterprise by its nominal owners,
the shareholders, became impossible when the number
of shareholders for the largest companies grew to the
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Sidebar 1.1 The Corporation
Defined (3)
tens of thousands and as the practice of proxy voting
(i.e., the voting of shares of absent stockholders by
management in the annual shareholders’ meetings) was
legalized and adopted. Salaried managers came to
exercise virtually proprietary discretion over the
corporation and its assets, which gave rise to debates
that continue today over the nature of ownership and
the social responsibility of corporation.
• http://www.britannica.com/EBchecked/topic/138409/c
orporation
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Chapter 2 – Corporate Communication as a
Critical Business Asset in a Time of Global Change
This chapter discusses the critical thinking that enables
executives to identify rapid changes in technology and
in global business practices that require creative and
strategic integration of knowledge to “connect the dots,”
and then to develop effective action in response.
Understanding and implementing four vital areas in
communication and advocacy -- public affairs,
sustainability, consumer and data privacy, and the
employment contract -- establishes the foundation for
the communication strategy for the corporation.
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Chapter 3 – The Lifecycle of
Organizations and the Role of Corporate
Communication
This chapter investigates four phases that corporations
experience -- birth, growth, decline, and if they are
sustainable, a rebirth -- starting the cycle all over again.
New corporations in the birth stage make the transition
to the growth stage, or their “adolescence.” Chinese
companies have elements of the growth stage.
Companies in the automobile industry recently in
decline, are now undergoing a rebirth. Companies that
can trace their history over a century or more are
excellent examples of corporations that are sustainable
and have maintained their capacity to be “reborn.”
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SIDEBAR 3.2 Adizes’ Corporate
Lifecycles (1)
The interrelationship of flexibility and control defines corporate lifecycles. The Prime stage is
ideal for sustainability.
• Courtship. Founders focus on ideas and future possibilities, making, and talking about
ambitious plans.
• Infancy. The founders' attention shifts from ideas and possibilities to results. The need to
make sales drives this action-oriented, opportunity-driven stage. Nobody pays much
attention to paperwork, controls, systems, or procedures. Founders work 16-hour days,
trying to do everything by themselves.
• Go-Go. In this growth stage, sales are king. Founders believe they can do no wrong. They
see everything as an opportunity. Their arrogance leaves their businesses vulnerable to
mistakes. They organize their companies around people rather than functions; founders
make every decision.
• Adolescence. Companies take a new form. Founders hire chief operating officers, but find it
difficult to hand over the reins. An attitude of us (the old-timers) versus them (the COO and
his or her supporters) hampers operations. Internal conflicts leave little time to serve
customers.
• Prime. With a renewed clarity of vision, companies establish a balance between control and
flexibility. Disciplined yet innovative, companies consistently meet their customers' needs.
They passionately nurture both expansive, creative energy and their need for structure.
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SIDEBAR 3.2 Adizes’ Corporate
Lifecycles (2)
Continued (The interrelationship of flexibility and control defines corporate lifecycles.)
• Stability. Companies are still strong, but without the eagerness of their earlier stages. They
welcome new ideas but with less excitement. Financial people begin to impose controls for
short-term results in ways that curtail long-term innovation.
• Aristocracy. Not making waves becomes a way of life. Outward signs of respectability dress,
office decor, and titles-take on enormous importance. Companies acquire businesses rather
than incubate startups. Their culture emphasizes how things are done over what's done and
why people are doing it.
• Recrimination. In this stage, companies conduct witch-hunts to find out who did wrong. Cost
reductions take precedence over efforts to increase revenues. Backstabbing and corporate
infighting rule. Executives fight to protect their turf, isolating themselves. Petty jealousies
reign supreme.
• Bureaucracy. If companies do not die, they become bureaucratic. Procedure manuals
thicken, paperwork abounds, and rules and policies choke innovation and creativity.
Customers-forsaken and forgotten-must devise elaborate strategies to get anybody's
attention.
• Death. This final stage may creep up, or it may arrive suddenly, with one massive blow.
Companies crumble when they can't generate the cash they need; outflow finally exhausts
any inflow.
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Chapter 4 – Major Events for
Corporations
This chapter investigates strategies and offers
examples of corporations that have successfully
navigated one or more of these important changes in
the life of a sustainable business. It focuses on three
areas:
• Communication and Corporate Strategy –
Understanding and Influencing the Change Process
• Communicating Strategic Change – The Continuum
of Reputation, Issues Management, and Crisis
Management is Built on a Positive Corporate Culture
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Chapter 4 – Major Events for
Corporations
Corporate Communication is Essential to the Success
of Strategic Changes: M&A, competition, antitrust;
structural alignment; culture change; innovation; new
leadership models for succession planning and new
concepts of leadership in corporations; downsizing;
global expansion.
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Figure 4.1 Porter’s Five Forces
Model of Competition
Porter’s Five Forces Model of Competition
Threat of New Entrants
Barriers to entry - Economies of scale - Product differentiation - Capital requirements - Switching cost to buyers - Access to distribution channels - Other cost advantages - Government policies
Incumbants’ defense of market share Industry growth rate
Determinants of Supplier Power
Supplier Concentration Availability of substitute inputs Importance of suppliers’ input to buyer Suppliers’ product differentiation Importance of industry to suppliers Buyers’ switching cost to other input Suppliers’ threat of forward integration Buyers threat of backward integration
Rivalry Among Existing Firms
Number of competitors (concentration) Relative size of competitors (balance) Industry growth rate Fixed costs vs. variable costs Product differentiation Capacity augmented in large increments Buyers’ switching costs Diversity of competitors Exit barriers Strategic stakes
Determinants of Buyer Power
Number of buyers relative to sellers Product differentiation Switching costs to use other product Buyers’ profit margins Buyers’ use of multiple sources Buyers’ threat of backward integration Seller’s threat of forward integration Importance of product to the buyer Buyers’ volume
Threat of Substitute Products
Relative price of substitute Relative quality of substitute Switching costs to buyers
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Chapter 5 – Strategic Models for
Corporate Communication Practice (1)
This chapter explains how the goals of the enterprise
are achieved through structures and functions within the
organization, the history of an individual organization,
and the communication needs of a particular industry. In
creating a corporate strategy, executives focus on the
assessment of the competitive environment and the
selection of a position in the marketplace that is
profitable, defensible, and achievable. They also
envision their corporation in the competitor’s position.
Then considering the possible moves the competitors
will make, they develop corporate strategies that will
move their business enterprise to sustainable profits.
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Chapter 5 – Strategic Models for
Corporate Communication Practice (2)
Strategically, the function of corporate communication
serves these corporate goals: advocacy for, or the
engineering of, public opinion concerning the
corporation; stewardship of corporate reputation,
identity, and image; counsel to the CEO and the
corporation. In addition, the importance of these
different corporate goals depends on several factors
such as the business cycle, the policy climate in an
individual country or industry, and the maturity of the
communication function in an individual organization.
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Figure 5.1 GE-McKinsey 9-Box
Matrix
High Medium Low
Competitive strength of business unit
Invest
& Grow
Selectivity &
Earnings
Harvest
& Divest
The Life Cycle of the Corporation
Figure 5.1 GE- McKinsey 9-Box Matrix
Med
ium
H
igh
Ind
ust
ry a
ttra
ctiv
en
ess
Low
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Figure 5.2 Peters and
Waterman’s 7-S Framework
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Strategy
Skills Structure
Super-
ordinate goals
(shared
values)
Style System
s
Staff
Figure 5.3 Coley’s Three
Horizons for Growth
Horizon 3: Create viable options
Horizon 2: Build emerging businesses
Horizon 1: Extend & defend core businesses
Time
Pro
fits
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Figure 5.4 Strategic Corporate
Communication Model
Global Environment: -Political
-Economic
-Historical
-Physical Audience Needs and Expectations Stakeholders: stockholders, vendors, analysts, media,
general public, etc.
Corporation’s
Goals and
Objectives
Ideal
Convergence
Corporate
Context
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Figure 5.5. Characteristics of Deal
& Kennedy’s Corporate Tribes Culture Type/
Characteristics
tough guy / macho work hard / play hard bet-your-company culture the process culture
Examples Advertising, Construction,
Entertainment, Publishing, Venture Capital
Consumer sales; Retail stores Oil, Aerospace, Capital-goods, Mining,
Investment Banking, Computer Design,
Architectural firms; Actuarial Insurance
Banks, Insurance, Financial Services,
Government, Utilities, Heavily regulated
industries (pharmaceuticals)
Risk & Stakes HIGH LOW HIGH LOW
Feedback from
environment
QUICK
FAST (You get the order or you
don't)
SLOW (Years with constant pressure) VERY SLOW TO NONE
Rewards Short-term focus; speed, not endurance Short-term focus; Endurance, not
speed
High stakes; Constant Pressure; Long-
term focus
Focus on how work is done; Real-world
remote
People "COWBOYS"; Individuals; Rule-breakers Super salespeople are the Heroes Company over individual; Heroes land the
big one; Young managers seek a "Rabbi"
Achieving rank; VPs are Heroes (or
survivors)
Structure of
Organization
FLAT for fast decision-making FLAT for fast-decisions; Forgiving of
poor decisions
HIERARCHICAL;
Slow decision making
HIERARCHICAL (many layers of
management); Slow decision-making from
the top down
Behavior Informal; Temperamental behavior
tolerated; Stars
TEAM Players; informal
atmosphere; friendly, optimistic,
humor encouraged; NO PRIMA
DONNAS
Formal, polite; TEAM players; NO
PRIMA DONNAS
Protect the system; "Cover your ass"
mentality; Emphasis on procedures,
predictability, punctuality, orderliness
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Figure 5.6. Hierarchy of Internal
Communication Effectiveness Effectiveness
High
Low
– Face to face, individual meetings
– Face to face, small group meetings
– Face to face, town hall meetings
– Live webcast/video- or teleconference meetings
– Interactive text-based intranet meetings, with polling
– Video to the desktop/podcasts
– Intranet postings
– Non-digital text/visual materials
– Voice mail
Interactivity
&
Engagement
High Low
Source: Goodman & Hirsch (2010)
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Chapter 6 – Ethical Issues for
Multinational Corporations
In this chapter, we look at various mechanisms
business organizations have created or participate in to
promote ethical decision-making in spite of the
temptation to focus on the bottom line at all cost. These
are a focus on creating ethical corporate cultures,
participation in global agreements that create ongoing
shared commitments to ethical behavior, and
mandatory transparency in richly detailed financial
reporting.
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Chapter 7 – Technology and the Social
Network
This chapter analyzes how Digital Media—the Web—
has created internal and external communication
challenges for corporations, examines what they are,
and suggests some of the ways in which companies
deal with them. The challenges include globalization,
employee use of social media in a networked
enterprise, news aggregation and timely corporate
responses in an instantaneous media environment, and
the use of electronic media in the regulated
environment of investor relations.
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Chapter 8 – Political Opportunities and
Risks within and across Borders
This chapter investigates the challenges that an
environment with fewer restrictions and more globally
complex supply chains has on corporate business
strategies. This environment for services, intangibles,
and intellectual property presents political opportunities
for corporations, as well as risks. The chapter will
analyze the opportunities and risks that are offered in
six functional areas: (1) sustainability—the triple bottom
line—social, financial, environmental performance; (2)
the supply chain; (3) advertising and marketing; (4)
accounting; (5) responsible investing, and (6) ethical
business practices.
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Chapter 9 – Metrics—Measures That
Determine Corporate Communication
Success
This chapter demonstrates the importance of metrics to
good corporate communication management. Objective
and scientific information provides a context for
evaluating performance, provides guidance for change,
helps to overcome weaknesses, and creates a
foundation for goal-setting. Setting clear research goals
and objectives keeps an organization focused. Quality
research, based in clear reasons and focused goals for
the research, can articulate long-term strategy and
operational tactics. Corporate communication
executives can then determine appropriate and
affordable metrics, tools, and techniques.
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Figure 9.3 Balanced Scorecard
Vision & Strategy
Customer
To achieve our vision, how should we appear to our customers?
Objectives
Measures
Targets
Initiatives
Internal Business Processes To satisfy our shareholders and customers, what business processes should we excel at?
Objectives
Measures
Targets
Initiatives
The Balanced Scorecard
Learning & Growth To achieve our vision, how will we sustain our ability to change and improve?
Objectives
Measures
Targets
Initiatives
Financial
To succeed financially, how should we appear to our shareholders?
Objectives
Measures
Targets
Initiatives
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Chapter 10 – Looking Ahead
This chapter examines the forces that concern the chief
communication officers of major multinational
corporations in three important areas as they lead their
companies:
1) Technology—"always on" communications;
2) Complexity—Companies whose entire footprint is
global need to have a corporate communication
capability with the same footprint.
3) Integrity. These conversations build on the findings
of the CCI—Corporate Communication Practices
and Trends Studies in the US and in China.
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