On Management: Perception and reality

Corporate image can take a battering if the communications group does not work to ensure transparency.

by Tom Kowaleski, World Business
Last Updated: 23 Jul 2013

Increasingly, companies around the world include the communications group, and in particular the chief communications officer, at the top table. Close to a half of Fortune 500 leaders of this function report directly to the CEO. This has enabled a major redefinition of the traditional role of what was commonly called public relations, from being primarily a disseminator of information created by company leadership to a partner in developing corporate values. But as the division of responsibility between communications and other management functions begins to blur, so the relationship between them becomes more complex and challenging.

Modern communications can provide an essential window into the perceptions held by the company's key stakeholders, from employees to customers, from regulators to critics. It assimilates the most important information from each into an essential snapshot for management that monitors the gap between the 'reality' of a company's position and the 'perception' its stakeholders have. It can even develop back-door channels of conversation. In short, properly led, it is inquisitive, engaged and continually working to assure transparency between what a company says it is about and what it actually does.

Valerie DiMaria, former head of Motorola Global Communications, is helping lead a group of the most senior professionals in the field create a white paper on this subject for the Arthur W Page Society, the foremost body of senior professional communicators. "We are in the process of doing this work, because we see tremendous change in the area of globalisation and it is forcing companies to think of their traditional communication channels in an entirely new way," she says. "With the explosion of new web-based message channels, just about anyone can function in some way, shape or form as a journalist, and the communications function has to, and is, evolving to aid senior management in engaging all stakeholders according to the new rules."

To better understand this, it helps to consider how information, news, rumour, partial facts and what is now universally known as 'content' are spread. The internet enabled the world to be connected into a powerful real-time force. Now, we live in a global network of communication in which anyone, anywhere has the voice and the power to shape perceptions and trends. Each day, anybody can express a point of view and be heard by millions in an instant. Bloggers, once seen as a group apart from traditional journalism, today function as an important part of the information process.

As a consequence, companies are now called to account immediately when their actions don't support their words. And when it doesn't hold up, the response is immediate, direct, often brutal in its assessment and potentially devastating to a reputation carefully crafted and built over years. BP, whose corporate image has gone into freefall following the disasters in Alaska and Texas, is a good example.

By any measure, BP has done a great job in defining a unique position, by separating itself from the common image of 'big oil'. Its execution of this strategy has been impeccable. Its simple position, Beyond Petroleum, is compelling and visual. Millions have been spent in communicating good intentions and good works to an impressive list of constituents the world over. Fine work by every measure, and I am sure the communications team was an important player in this. But when the incidents in Texas and Alaska implied that BP's actions countered everything it said it stood for, a powerful network of stakeholders and critics, from employees to shareholders to the media, joined forces to attack the company from all sides.

At this point, communications staff can, and must, counsel management to get into the conversation, listen to its harshest critics, admit problems, clearly spell out corrective actions and remind everyone of the collective body of good work done for so long. It can and must provide the understanding that with every brilliant position created, there's also the responsibility to stand behind it with the credibility of action. Of course, management can either accept or reject this counsel.

So could the BP communications group have done more after the fact? Perhaps, but so could the rest of senior management. Could the group have better alerted senior management to the potential consequences of the disaster? Yes, but again so could others even closer to the action and more knowledgeable about the potential dangers. Communications groups may have more of a influential role within companies than ever before, but effective communication remains the responsibility of everybody in the firm.

Tom Kowaleski is head of communications consultancy actk2. He was vice-president of global communications at General Motors before retiring in March 2006.

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