Crisis Communications

Crisis is a major catastrophe that may occur either naturally or as a result of human error, intervention or even malicious intent. Though all crises are unique, they do have some common characteristics:

1. Element of surprise
2. Insufficient information
3. Quick pace of events
4. Intense scrutiny (especially by the media)
5. Presence of Panic
6. Chaos in communication
   

Preparing for crises

• Assess organizational risks: All organizations- public, private or non-profit are at some risk in case a crisis occurs. Plan in advance for crises for better management in case crises occur. Be prepared for crises with higher probability of occurring. Determine which constituencies would be most affected by the crisis.

• Set communication objectives for potential crises: Be sure about what to say and to whom when a crisis occurs. Communication takes on more importance than action when the crisis involves more intangible things such as reputation than other tangible things.

• Analyze channel choices: Whether communication objective will be achieved depends on the effectiveness of the channel the company chooses to convey the message. During crisis constituencies crave for information and are more sensitive than usual. The choice of communication channel often reflects how sensitive a company is to its constituencies’ needs and emotions.

• Assign different teams to each crisis: Different problems require different kind of expertise. Assigning different teams to handle different crises helps the organization put the best people in charge of handling the crisis and communication. Most of the time the person closest to the crisis is the one people want to hear from.

• Plan for centralization: When it comes to crisis, corporate communication must be centralized. Planning for centralization can strip away layers of bureaucracy, keep lines of communication open throughout the organization and dissipate conflict. Decentralized organizations often find it more difficult to communicate efficiently between divisions.

• Create a formal plan:

1. Make a list of whom to notify internally or externally in an emergency
2. Release as much information as soon as possible to avoid loss of credibility.
3. A strategy to notify employees
4. A location to serve as Crisis Headquarters
5. A description of the plan
   

Communicating during a crisis

The corporate communication strategy framework can be used to communicate during a crisis. Steps to communicate during a crisis are as follows:

1. Get out on the scene and take control of the situation
2. Gather as much information as possible
3. Set up a centralized crisis management centre
4. Communicate early and often
5. Understand the media’s mission in a crisis
6. Communicate directly with affected constituents
7. Remember that the business must continue
8. Make plans to avoid another crisis immediately
   

After all these steps, always maintain a feedback system. This will check how effective the communication strategy has been. If it works well improvise on it. If it doesn’t, find out the reason for its ineffectiveness and come up with a better solution.

Reference:

Ray O’Rourke, presentation to Corporate Conference, New York University, January 1997.

Brian O’Reilly, “Managing J&J on a Roll, “Fortune, December 26, 1994.

Frank Corrado, Media for Managers (New York: Prentice Hall, 1997).

21st Century Communication Trends

Organizational structures in the early till late 20th century were mostly vertically integrated. Large organizations like Ford, GM produced almost all components that went into their product. The later part of the century witnessed a significant change in organizational structures owing to increase in competition, differing consumer taste, globalization, technological changes and a host of other factors but mostly to compete effectively against rivals.

Globalization

Disintegration of trade barriers coupled with liberalization of trade and finance provided a platform for corporations to go beyond national borders. In today’s business mergers and acquisitions are common activities seen worldwide. Multinational companies have set up business units in different countries to benefit from economy of scale and improved quality of international transportation and communication. Global sales have increased; manufacturing is done in one country and sales in another to exploit differences in regional cost and expertise. Companies are also seen undertaking research jointly or independently in search for unsaturated markets. Moving from direct marketing to indirect form, more customer oriented services and products.

Diversity

Workforce of this generation is more heterogeneous in terms of sex, race, culture and individuals. With globalization there is a need to cope with different styles of interaction, dress, presentation and physical appearances. Diversity of workforce is a source of innovation and learning. But also this has led to problems regarding communication among divisions and within mainly due to demographic, social and ethical forces.

Flexibility

Due to differentiated customer needs increasing diversity in workplace and increased pace of change in technology and markets organizations require structures, processes and people that can respond differently to different situations. Organizations have fewer detailed rules and procedures to make functions more flexible. There is greater autonomy of individuals and encouragement for initiative. Employees are cross trained to handle more than one job. The motive is gain a competitive advantage over others. Features of flexibility include customizable employment relationships like telecommuting, job sharing, mommy tracks, pay for skills, lifetime employability and not lifetime employment. TPS is an important example of flexibility in operation also commonly known as Lean Manufacturing in general.

Flat

A flat organizational structure is characterized by fewer levels of management in the hierarchy. There are fewer differences in responsibility (not in pay) across levels. One very important implication of a flat structure is that workers are empowered to make decisions irrespective of responsibility. This facilitates communication from bottom to top and not only from top to bottom. Due to fewer levels communication is quick and accurate. Necessities of a flat structure are due to need for speed, which makes it helpful to empower employees to make decisions, which in turn means fewer managers are needed. Changes in information technology mean less need for the communication and control functions of middle managers. This helps cut costs in operations and manufacture as globalization intensifies competition, which increases the need to cut costs.

Networked

Today’s businesses are entirely built upon networks of people, technology and infrastructure. How efficient a network is determines the efficiency of an organization to respond quickly to changes in demand and threats. Information is shared instantly across unit & firm boundaries, ignoring chain of command. Teams are not confined only to their domain. Networking is important due to the following reasons:

• With globalization began outsourcing & downsizing and these unit needs to be networked.
• Strategic alliances with competitors and others also create the need to have a network in order for strategies to be effective.
• Companies have competitors, customers and collaborators all at the same time. Close coordination among firms (e.g., JIT systems) are required.
• To stay close to customers
• Customization and decentralization of operations
• New information technologies, especially groupware, client-server, distributed computing fast changing customer needs and competitor offerings more complicated products require better integration of manufacturing, design, and marketing functions
  

Reference:

http://www.wired.com/print/techbiz/media/magazine/15-09/st_pechakucha

Internal Communications

Communicating to the external constituents is important. But in order for this function to work effectively, communication within the organization needs to take place swiftly. Without proper internal communication, message sent across to the external constituencies can be varied and confusing. Today’s employees demand participation. Business environment are more complex and competitive. This puts greater pressure on employees and also calls for more concerted effort in the area of internal communications. Right Management Consultants revealed that the top area that managers and executives need to improve is their ability to engage employees in vision and strategy.

Organize the internal communication effort

Through a communication audit find out how employees attitude towards the organization and about the communications they are receiving internally. Depending on the results obtained put an internal communication infrastructure in place to better cater to the needs of employees. If an infrastructure is already in place, it can be adjusted for better performance.

Goals for effective internal communications

Internal communication should be done on the line of the company’s objectives and mission. Employees need to have a clear picture of what the company stands for and its visions. Effective internal communication should reinforce employee’s beliefs that they are important assets to the firm. This can happen only through active participation by the top management and if the communication effort is handled by professionals. Companies can also have a separate corporate communication division in place devoted only to communication aspects.

Methods

There are several methods that can be adopted to make internal communication more meaningful. It can at the personal level, group level or at the corporate level. Some of them are as follows:

Face-to-face meetings

Conduct in-person meetings with fairly large groups of employees with greater frequency. Provide employees with an opportunity to ask questions of management in an open forum.

Communicate online

Internet and intranet can be used as a platform to communicate and interact with employees. But make sure not provide too much information as this can be distracting.

Take employees as well as top management interviews and surveys

This can be an effective tool as employees are given privacy to respond to questions rather than a personal interview where they might not respond honestly.

Internal branding

Internal branding is also important to building morale and creating a workplace where employees are attached to their jobs. Just as external branding aims at creating emotional ties between consumers and the company, internal branding aims at doing the same with employees.

Analyse result

Analyse the resulting data as well as prior information available in the organization. Based on the outcome of analysis set measures to fix problems and enhance the internal communication function.

Communicate results with employees




Make employees aware of the results whether it is good or bad. Make them participate in developing strategies to make communication more effective within the organization. Always maintain a feedback of the ongoing activities.

Reference:

Right Management Consultants, “30% of Managers & Executives Lack Necessary Management Skills,” September 21. 2004, http://www.right.com

Colin Mitchell, “Selling the Brand Inside,” Harvard Business Review, January 2002.

Media Relations

Importance

The media relation is one of the most critical areas within a corporate communication function in an organization. The media are both a constituency and a conduit through other constituents receive information about the company. The media is a very important factor in shaping the image of a company.

Building better relations with the media

• Cultivate relationships with the right people (only a few) in the media and strengthen the relationship. The right people will help build company image and will also co-operate during crisis to preserve the image.
• Avoid the old practices and adopt new ideas and measurement techniques to gain more audience.
• Make information precise and short.
• Spend more time doing research to communicate better with the media. Senior executives outside the communication function are usually reluctant to spend more time in research and deal with only a few people in the media.
• Carefully handle requests for information by the media. Such approach can make a great difference in the way companies appear in stories.
• Have a centralized communication function for consistency in information being provided.
• Keep tract of how effective strategy has been.
• Maintain ongoing relationship
• Hire a expert in the field
• Avoid using external help as much as possible
• Handle negative news carefully to avoid further damage
  

Online media

The internet is everywhere. Information spreads like a wildfire over the internet than any other types of media. Maintain good relation with constituencies involved in online media. Update websites information regularly and respond frequently to blogs and forum about the company.

Media interview tips

• Keep answers short
• Avoid no comment response
• Pay careful attention to each question
• Use bridging to move closer to your objectives
• Use anecdotes
• Keep body language in mind
  

Reference:

BenchPoint Report on Measurement, 2004, http://www.benchpoint.com

Mary Munter, “How to Conduct a Successful Media Interview, “California Management Review, Summer 1983.

http://www.roundtablegroup.com/speakersbureau/talk.cfm?talkID=3829

Corporate Communication Relevance

The continuously changing environment requires organization to communicate between functions. Communication has become crucial in maintaining relationship with all its constituents. We have seen that communications play a big role in all of the organizational areas. Even in the strategy formulating process, companies need to use corporate communication effectively in order to communicate the strategic approach to their constituencies. However, especially in crisis situations, corporate communications becomes critical for the organizational survival. We have seen that a bad communication can even lead to crisis.

We now live in an age of rapid advancement in information technology. Organizations have much more technology to communicate with than ten years ago. The Internet alone provides many opportunities of effective communication. Communication have become mobile people are able to read their e-mails on the road and work. Organizations have to consider these new trends and design communicatio strategies in such a way to profit from the new opportunities.

The 21st century trends make it obvious that the corporate communication needs to be taken seriously. Consumers are more demanding and are more time constrained. The mass has more informaitons available at their dispposal to make decisions and have more power in terms of choice as compared to the older generation. It is important that the corporate communications department closely works together with all departments in order to reach organizational goals and objectives.

In future, corporate communications will become even more important to organizations. New communication technologies will evolve and the way we are doing business will change. Organizations must face these changes and adapt to them as soon as possible to not fall behind in competition.

Globalization and advancement in technologies have no doubt brought about opportunities. But it also carries some serious threats. Organizations have to pay more attention to the communication aspect, there is more competition everywhere. Companies needs to keep costs low and operate on low margins. Virtually there are no room for errors.

Reference:

http://en.wikipedia.org/wiki/Corporate_communications

Corporate Advertising

Corporate advertising is defined as the use of paid media to enhance the company’s image rather than just promote its products or services. Corporate advertising should brand a company the way product advertising brands a product. Bigger the company, the more likely it is to have a corporate advertising program. It is also used heavily by companies within more controversial industries like cigarette, oil, pharmaceutical companies etc. It presents a clear identity based careful assessment of its overall communication strategy and generally falls into three broad categories:

• Image advertising
• Financial advertising
• Issue advocacy
  

Purposes of corporate advertising

Strengthen or rebuild image

Corporate advertising helps in the formation of an identity for the organization. It also provides means for differentiating itself from competitors. Companies also use corporate advertising to reinforce their identity following structural changes like merger or after a crisis. Examples are Tyco using corporate advertising to rehabilitate its image after the corporate fraud by former CEO Dennis Kozlowski and former CFO Mark Swartz. In 2005, Tyco won the best corporate advertising award from IR Magazine.

To attract investment

Financial-relations corporate advertising is one important tool companies use to enhance their images in the financial community. This kind of advertising can stimulate interest in a company’s stock. Among different criteria “strength of management” was the number one factor in influencing decisions to invest in a company. James Gregory of Corporate Branding LLC explains that the CEO’s ability to paint a picture of the company’s future is the linchpin of a successful corporate advertising campaign. Hence companies’ CEOs are often featured in corporate advertisements aimed at financial communities. Thomas Garbett also asserts that corporate campaign ensures that company’s shares are not overlooked or undervalued.

To influence opinions

This type of advertising is often called issue or advocacy advertising. It is used by companies to respond to external threats from government or special interest groups such as environmentalists. Amway ran a series of ads that positioned the company as environmentally aware. Another famous example is Mobil Oil’s series of issue advertisements which ran for over 20 years. When sending across a message companies also needs to make sure that it does not leave any room for criticism.

To increase sales

The relationship between corporate advertising and sales is not very clear. Corporate advertising eventually boosts sales but not immediately or directly. ROI are usually not immediate and this creates a problem for managers trying to introduce corporate advertising into companies that have a heavy financial orientation.

Create a stronger reputation

Good corporate advertising creates goodwill and enhances reputation. Good advertising lets constituents know what the organization is about. Reputation is enhanced if it provides benefits people are not aware of. It is also done through the endorsement of a third-party-organization. One very important aspect is credibility of the advertisement.

Recruit and retain employees

Communicating with employees is one of the most critical activities for any organization. It also indirectly boosts morale among employees. Good corporate advertising also attracts the best talents both at the entry level and senior positions.


References:

Suzanne Vranica, “Tyco Aims to Put Its Woes Behind It,” The Wall Street Journal, June 15, 2004.

James R. Gregory, “The Impact of Advertising to the Financial Community,” BusinessWeek special publication, 1999.

Thomas F. Garbett, “When to Advertise Your Company,” Harvard Business Review, March-April 1982, Corporate Advertising

Communication Technologies

Technological advancement has brought about changes in the way people communicate. In order for organizations to communicate effectively with constituents organizations need to tap into this advancement. Various platforms for communication are available today for organizations to communicate efficiently. Some of them are traditional while some are new.

Mail

Letters have been used for centuries for communication purposes between individuals and organizaitons. It is particularly important for sending original documents certificates to far off locations. But the main disadvantage is that it is time consuming. Unless time is a constraint it can be used and is still in use today. Today its not just letters but parcels, clothings, books, machines etc. that is sent via mail.

Telephone

One of oldest mode of communication is the telephon. Communication is one on one and instant. Penetration is higher as almost every second person in the world knows how to use it and feels comfortable using it. Easy to procure, install and maintain has made it one of the most economical communication tool of the century.

Cell Phones and PDAs

The world is considered a global market and managers need to continue making decisions virtually everywhere they go. Business on the run would not be possible without the use of mobile phones. Globalization has even more increased the need for mobile communication. Personal Digital Assistants (PDA) and Smartphones have further developed the functionality of mobile phones. With internet enabled features, managers can also send and receive e-mails while on the road.

Video Conferencing

With globalization companies have recognized the need for communication across borders. Even shareholders and investors demand visual communication if not in person. Therefore, video conferencing has become a common tool to conduct cross national communication. Advancement in technology also have made it cost effective as compared to travelling and meeting in person. Communication is instant and is as good as the other person is in the room evenif its not for real.

E-Mail

With the increase in popularity and usage of the world wide web electronic mail (e-mail) has become the primary form of communication for many people around the world. The advantage of E-Mail is that the message is received immediately by the recipient. Plus it costs very less. Disadvantage of E-Mail is spamming. Microsoft founder Bill Gates, for example, receives literally 5 million spam mails per day.

Corporate Intranet



Companies can also make use of a corporate Intranet for communication purposes within the organization. Like the Internet it is a collection of web pages and informations but only accessible to employees of the company. Employees can mine important information, documents, or communicate with co-workers by using the corporate Intranet. Intranets are mostly used as a knowledge management system. Documents and results from previous projects/processes are uploaded on the Intranet and can be accessed by other employees.

Blogs

Blogs are a form of diary on the Internet or a corporate Intranet. Many executives use blogs to share experience, provide information about the development of a corporation. Blogs are a good way to keep employees and other constituencies informed about what is happening in the company. Visitors can post comments about the topic and this increases interaction.

Reference:

http://findarticles.com/p/articles/

Communication Theories

Communication is the sharing of information and related activities that helps in better understanding of one party by another party. Communication is a necessary process of life itself for individuals, communities, countries, economies etc. Our focus is on organizational communication with external environments and within the organization.

In general communication takes three settings:

• Interpersonal
• Machine-assisted
• Mass
  

Importance of communication model:

• Communication models offer a convenient way to think
• Provides better understanding through graphical representation
• Can be changed to better suite organizational requirements
  

Some prominent communication theorists from the past and their theories are as follows:

Harold Lasswell Model (1948)

“Who says what to whom in what channel with what effect”

Wilbur Schramm Third Model (1954)

• Communication process is circular and linear
• Provided the additional notion of a “field of experience,”
• Included feedback
• Included culture
• Included context
  

Claude Shannon Weaver’s Model (1949)

• Most commonly used communication model in the lower level
• Taken as an approximation of the process of human communication
• Significant heuristic value
• The concepts of this model became staples in communication research
  

Bruce Westley & Malcolm McLean

• Accounts for Feedback
• Accounts for a sensory field or, in Newcomb’s (1953) words, “objects of co-orientation.”
• Accounts for non-binary interactions—more than just two people communicating directly.
• Accounts for different modes. E.g. interpersonal vs. mass mediated communication.
  

Lawrence Kincaid’s Convergence Model (1979)

• Covers a broader area in communication by taking into consideration psychological factors.
• Expectations, believes, action and reality are considered.
  

Reference:

http://en.wikipedia.org/wiki/Harold_Lasswell

http://www.shkaminski.com/Classes/Handouts/Communication%20Models.htm

http://www.help-explorer.com/images/poweredby_hxserver.png

Identity, Image, and Reputation

Identity

A company’s identity is the visual manifestation of the company’s reality as conveyed through the organization’s name, logo, products or services and any other form of tangible assets created by an organization. Examples: Mercedes, Nissan and Microsoft. When we hear these names it identifies the company and to which industry it belongs. Identity also helps companies differentiate itself from other competitors in the same industry and needs to be consistent. Example: how Shell differentiates itself from ExxonMobil being in the same industry.

Shaping identity

Creating an identity is the only part of shaping a company’s reputation an organization can completely control. Create an inspiring corporate vision that positively communicates with the desired constituencies. Branding and brand management are critical components in shaping identity. Branding refers to names and logos to identify certain products or a class of products. Examples are Lexus from Toyota and Chevrolet from General Motors. Company names are also used to signify what the company stands for e.g. Accenture is a combination of two words accent and future. Change of identity is also sometimes necessary e.g. Muzak with its new identity.

Image

Image is a reflection of an organization’s identity as seen from the viewpoint of its constituencies. A company’s image can be varied depending on the constituencies involved. Mercedes can have different images among different customers. Understanding the image and identity is important to know what the organization is about and where it’s headed. Companies with strong image usually have a larger market share. It also means that all communication strategies adopted to communicate with its constituents have been effective. Another important factor is the company’s image within an organization. A productive corporate culture is reflects a sound company’s image within the organization. Employees feel privileged to work with the organization as in the case of IBM, DELL, Starbucks etc. A company can also enhance its image by contributing more towards community and environmental cause.

Reputation

Reputation is the company’s status from practices or actual delivery of products and services as portrayed by the identity and image. Reputation is entirely based on the actual perception of the constituents involved. When identity and image are aligned, this forms the foundation for a solid reputation. The rest depends on the actual performance of the company in communication and delivery. A strong reputation has important strategic implications for a firm as it calls attention to a company’s attractive features and widens the options available to its managers in pricing or implementing innovative programs. It forms the basis for developing a competitive advantage, attract and retain the best talents as well as loyal customers and business partners.

Reference:

Guy, “Consultant to Launch Big Effort to Advertise Its New Identity.”

Naseem Javed: “Playing the naming game.”

Charles J. Fombrun: Realising Value from the Corporate Image (Boston Harvard Business School Press, 1996)

Communicating Strategically

Changing environment requires different approach in corporate communication. Communication unlike other functions affects every individual at every level of hierarchy in an organization. Most managers spend their time developing business strategies, but only few pays attention to the communication aspect. Good communication between all functions fine tunes an organization’s way of doing business. Competing in a changing environment requires identifying the changes, adapting to the changes, keeping communications cutting edge and avoiding cutting corners.

Developing Corporate Communication Strategies


Message

Set objectives for a particular communication based on what the organization expects from the constituents. Decide what message to send across considering the resources available and organizational reputation to achieve those objectives. Reputation can be harmed due to another organization as in the case of Firestone and Ford explorer. Energy companies faced a collective reputationl challenge due to Enron.

Analyze the constituencies

Determine: 1) who are the constituencies 2) what is each constituencies’ attitude towards the organization, and 3) what does each constituency know about the communication in question.

Deliver the message appropriately

• Select the right communicating channel. Choosing the right communication channel can be challenging in that different constituencies will have different perception. Multiple channels can be used but this also means increase in costs. One of the cheapest and easiest means is the internet. But this does not cover every constituency.

• Structure the message carefully. Two most effective methods are direct and indirect. Direct structure means revealing the main points first, then explaining why. Indirect structure means explaining why first, then revealing your main point. Organizations should as direct as possible because indirect communication can be confusing and hard to understand.


Constituency response

After communicating, make an assessment of whether the communication had the desired result. Maintaining feedback is important to check the effectiveness of the communication strategy. If it has not been effective, what changes are to be made? If it yields the desired result, how to continue and improvise on it?

References:

Munter, Guide to Managerial Communication.

Michael Kempner. “When RUMORS Thrive Your Deal's in Trouble: Damage control techniques to seize the communications high ground.” Mergers & Acquisitions: The Dealmaker's Journal, May 1, 2005.

Martin Roll, “10 Steps for Successful Corporate Branding”

Changing Business Environment

Businesses today are different from the past. People’s attitudes towards corporations have dramatically changed over the years. The industrial revolution brought in mass production in factories leading to lowering in prices of finished goods. On the other hand, this also brought about harsh and dangerous working conditions and exploitation of young women and children. This era was also characterized by increasing differences in distribution of wealth. This era was also characterized by increasing differences in distribution of wealth. The Second World War, role of United states in the Vietnam War, 1973 Middle East war brought about different facets of the people's attitudes towards public and private institutions from high to low.

Technological Changes

The impact of technological changes over the years has been significant in bringing about evolutionary changes in communication, infrastructure and the way people around the world communicate. This has been an important determinant in creating a “Global Village” and a new class of knowledgeable consumers. Information weather good or bad are almost instantly available across the globe over the internet. No doubt corporations have benefited from new emerging technologies. But it also requires companies to be more aware of new threats that come along with these changes.

Globalization

Coupled with changes in technologies, globalization has drastically changed the way companies do business. Today, firms concentrate on competence and competitive advantage. Organizational structures are generally flat as compared to a high degree of vertical integration in the past like Ford and GM. Competition is everywhere and companies are actively on the search for customers, maintaining present customers and enhancing customer experience.

The Media

Media has always played an important role in shaping corporate image among the public. Whether it's the newspaper, television, radio or internet media is everywhere and through these channels makes information available globally in a short period of time. Communicating properly through the media can enhance a company's identity and increase confidence among the public. There is a need for higher corporate social responsibility and involvement in environmental and community services to improve a firm’s image.

References:

http://highered.mcgraw-hill.com/sites/0072834943/student_view0/ebook/chapter1/chbody0/the_changing_business_environment.html

http://www2.co-operative.com/CSR2004/22_case_study_business_environ.asp