Communication strategies for a new world - Accountancy Ireland, December 2016

Ita Gibney explains how individuals and organisations can win their case in the court of public opinion.

For chief executives, chairmen and boards of directors, developing and assessing strategic communications functions and plans is akin to forging a path through a newly overgrown jungle. If you work for a company like Samsung, Volkswagen, Wells Fargo, Deutsche Bank or Apple and find yourself in the eye of a global storm, your ability to communicate quickly, assuredly, consistently and constantly across a global team of spokespeople is central to your organisation’s very survival.

The traditional communications formula was to have a policy that supported the company’s corporate and strategic objectives, backed by a detailed and calandarised plan that was executed by either a well-resourced internal communications department or by an external PR agency working directly with the CEO’s office or the internal Head of Communications. It had defined strategies, managed channels of communications that were used to reach the key audiences, KPIs that enabled the company to assess whether the programme was working, regular research – either formal or informal – to track progress, and a crisis management plan which was tested regularly to make sure the company was in a constant state of readiness should a crisis unfold. It was a system based on control of message, selection of appropriate spokespeople and channels – including the media – to deliver the message, and preparedness at all times. Like all other functions in the company, it was a managed function and this allowed the board to feel confident that the communications function was running as smoothly as its marketing, human resources or finance functions.

A new world order

So what changed? Almost everything – the market for news and how it works, the channels used to deliver it, the speed of message to market (formal and informal, verified and unverified), the demand for authenticity coupled with immediacy, real and dangerous threats to the information boundaries of the company (whether through technology glitches, cyber-security lapses, leaks, hacking, whistle-blowing, the smartphone’s ability to record a company’s every process and interaction). And while this communications revolution is happening, corporate governance and ethical standards are higher than ever.

Given the recent corporate collapses and market crises, the failure of regulation and ineffectual corporate governance, a whole new industry for risk management, corporate governance codes and corporate ethics education has come into being. Directors are, or should be, more keenly aware of their responsibilities and know how foolhardy it is to hold dozens of board appointments, given the public, media and regulatory scrutiny that any company can come under. Not many years ago, when auditing standards and rules were criticised, people called for a principle-based rather than a rules-based approach to protect against audit failures. In others words, let’s be honest rather than merely compliant.

The same principle-based approach is gradually seeping into the decision-making processes of companies as they assess their own decisions, cultures and communications strategies in the context of reputation management. Companies’ crisis management plans are being revisited and reassigned into wider corporate reputation strategies, recognising that crisis prevention is the key to corporate health and survival. As the doctor says, “Do no harm.” No company chief executive wants to be filmed stumbling from the metaphorical car crash when the crash would not have happened with the right car maintenance and driver training, not to mention awareness of the weather alerts.

The corporate reputation risk audit

A corporate reputation risk audit is the bedrock of the corporate reputation strategy and plan. Chief executives want to know where the weaknesses lie, how they can be strengthened, which channels of communication within the company are robust and the potential for leakage of information. The information boundaries can then be shored up and strengthened. In conducting such exercises, common weaknesses emerge. These include:

• Lax implementation of employee policies, such as internet policies, protection of proprietary information and staff induction;
• Communication flows when cyber-security is breached. For example, reporting lines to the communications team in cases of actual or potential data breaches such as the theft of a laptop, weak policing of the company’s standards of encryption and procedures for off-site computer access; and
• The need for senior management sensitisation to potential exposures – employee training and table-top exercises, for example.

On the other hand, the risks of not complying with existing company communications policies are equally important to identify in an audit. Are targets for responding to customer queries being met, for example? How responsive is the press office to the needs of the media? Can written communications be audited for style, honesty, clarity and impact?

From audit to action

On foot of a reputation risk audit, scheduled and calendarised action plans should be developed around each risk element and frequently reviewed and updated. This is a key part of a company’s reputation fitness regime, ensuring that good communication is in the company’s cultural DNA, not just an empty aspiration in the company’s mission statement. Leadership is often the most important ingredient – a CEO who gives communication top priority, who is adept himself or herself in dealing with the challenges of listening and talking. This is not a skill that comes naturally, but one that is acquired through practice and training with professional counsel. A wise CEO will prepare and rehearse for every media interaction, every public speaking engagement. Noone who cares about corporate or personal reputation will wing it in such risky situations.

Companies now focus on their own internal functions, frequently bringing in independent expert communications agencies to assess the functioning of their press office and audit the effectiveness and appropriateness of their communication strategy and tactics. Many enterprises struggle to find their voice and also, to decide on what to say to gain a competitive share of attention in the marketplace and ensure it is heard across all available communication channels – both owned channels (website, social media, research, and publications) and earned media.

Savvy chief executives now have a trusted senior person, usually independent of the company, to run decisions past when these decisions have the potential to cause reputational damage or give senior management that uncomfortable feeling in their gut. In the old days, they sought legal opinion. Now, they also seek the counsel of an experienced communications professional, recognising that not all legal actions protect the company from the fallout if an action is deemed to be contrary to public or customer interest.

The key ingredients

Nearly all companies who do market research nowadays are told that trust is the fundamental requirement to enhance their reputation; support their brand, sales or share price; or get the deal done. Building or rebuilding trust with all stakeholders – staff, customers, shareholders and the body politic – has become a top strategic priority for brands and management alike. This is not surprising given the corporate failures of the financial crisis, the constant and continuing stream of corporate scandals from deliberate car defects to crèche owners’ treatment of babies in their care and charities skimming public funds for exorbitant executive pay packages. Corporate globalisation has meant that product recalls can cost billions and are no longer localised, as the Samsung Galaxy 7 issue testifies so clearly. Likewise, localised issues become global fast.

Common sense tells management that you build this trust as you do any relationship – by being straight, by aligning your corporate values and all processes to a good moral compass, by performance, by delivering on promises, by consistency. This is achieved by ensuring that the reputation management (or corporate communications) strategy ensures that message and action is aligned at every level, in every decision, and on every channel of communication from the head office press release to the customer email, and by ensuring that all communication is trustworthy.

Nowhere is the reputation of a company more visible and more vulnerable than in the midst of a crisis. Defining when you are facing an imminent crisis is often the first step. Some chief executives think an issue will go away or not surface if it is kept under wraps. Others feel that they have to confess immediately and publicly on finding a transgression. Neither approach is right or wrong. Judgement calls have to be made and a corporate communications adviser will advise as to how an issue will likely play out in the arena of public and media opinion, identify the right thing to do, and how best to handle the situation to minimise damage to all involved. The whistle-blowers’ legislation, as well as the ability of the smartphone to become a 24-hour undercover news-gathering camera, means that companies now have less control over what becomes public and when.

Probing questions

Can you teach corporate ethics, or should a board of directors assume that its senior executive management team will show leadership in this area? Where is the interface between a corporate decision that is legal and will drive profits, but which transgresses the sentiments or perceived rights of a stakeholder group? Is there a price one puts on reputational damage, or what communications strategies can be put in place to minimise the damage and perhaps do most good? What are the unsaid “permissions” in a corporate culture? What is implied in the corporate DNA, but not in the handbook, to allow behaviours such as those in Wells Fargo Bank which has cost it so dearly? One thing is becoming clearer every day – a chief executive or board does not have deniability simply because it did not formally signoff on a particular behaviour. Unrealistic targets, an excessive bonus culture and a climate of fear can drive a short-term agenda that can cost a company in reputation terms for years to come – probably forever, thanks to Google.

Does all this come within a corporate communications strategy? Yes, if you consider the huge cost of dealing with negative issues when they break. Employee confidentiality policies, protection of information, cyber-security… all of these are now part of the reputation management strategy. It is absolutely true that one’s actions speak louder than words.

None of this is meant to scaremonger or underestimate the simple fundamentals of good corporate communication strategies. Each strategy must have clear goals, defined actions across defined timescales and clearly written desired outcomes that can be measured. All strategies play out against a social and business backdrop, so awareness of the context, recognition of how the marketplace for the message is changing, and feedback and intelligence- gathering are vital to an unfolding organic communications process. Like all good communications, it has to be a two-way process. Knowing your audiences and how best to reach them is crucial. Developing the right message and content – and being authentic and true to yourself – is mandatory. Managing risks is important and being in tune with expectations, knowing when and where to speak or when to be silent are finely tuned aspects of your theme music. Having a clear agenda of what you want to achieve or what changes you wish to realise gives the entire strategy its focus. It’s not just about the voice – the noise you make – it’s about the message, the content and what channels to broadcast on – paid, owned, shared or earned.

Preparedness and how much control you can keep over all of this while still being authentic is the ultimate test. In today’s climate this is the real challenge to all individuals, companies and enterprises that seek to win their case in the court of public opinion.

Ita Gibney is Chairman of Gibney Communications and a leading corporate communications advisor.