Current trends in corporate communication

Michael B. Goodman

The author Michael B. Goodman is based at Fairleigh Dickinson University, Madison, New Jersey, USA. Keywords Corporate communications, Crisis management, Management roles, Corporate culture Abstract Explores trends in corporate communication based on the Corporate Communication Institute Benchmark Study and on the Council of Public Relations Firms Spending Study. Presents answers to five basic questions on how change has an impact on practitioners and the profession. Electronic access The research register for this journal is available at http://www.mcbup.com/research_registers The current issue and full text archive of this journal is available at http://www.emerald-library.com/ft

Change. You have been hearing about it and how important it is for a decade or more. What can I add to your knowledge? I have some data from the Corporate Communication Institutes Benchmark Study conducted November 1999 to March 2000, and the Council on Public Relations Firms Spending Study conducted February 2000 April 2000. Before I get to the five questions I hope to address, not answer since that implies finality, lets begin with the simple notion that all change is personal. Change happens like the tide or the wind or the build up of mountains; or like an earthquake, tidal wave or tornado. Nothing prepares you for change better than the awareness of what you can do, and cannot do, about it. Lets investigate some basic questions about change as it relates to us personally and to our profession: . What has change got to do with it? . What is the role of business and communication? . What does this mean for the individual, and what is the challenge in meeting future changes? . What new tools do you need for your toolbox? . What has changed in audiences and in communication channels?

Whats change got to do with it?

Everything if you plan to survive. Nothing if you dont. Ill assume you are all here to survive. Last winter the Corporate Communication Institute conducted a study to set a benchmark for the practice of corporate communication. We surveyed Corporate Communication executives from Fortune 1,000 companies and asked 18 questions. Several of these focused on the functions of their work and the budget responsibilities for
This paper is based on the Corporate Communication Institutes Benchmark Study (2000) and remarks at the Council of Communication Managers Annual Meeting (October 2000) and at the Corporate Communication Institutes New Leaders Forum (January 2001). The author acknowledges contributions from Jill Alexander, Christia Genest, James Huttin, Jennifer Lehr and Gary Radford.

Corporate Communications: An International Journal Volume 6 . Number 3 . 2001 . pp. 117123 # MCB University Press . ISSN 1356-3289

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those functions. Other questions asked about the executives themselves age, educational background, gender, salary. We also conducted phone and e-mail interviews with selected respondents. We were also commissioned by the Council of Public Relations Firms to conduct a study of the relationship between spending on Corporate Communication functions and its reputation as reported by Fortune in its annual ranking of the Most admired. What we found in these studies has implications for you, and how you do your work. Here are a few of them (11 if you are counting): (1) Relationships with your community matter a great deal. The CPRF Study indicted a positive, statistical relationship between what a corporation spends on its foundation activities and its reputation ranking. This finding was unanticipated, and we plan to follow this up with our second round of research. (2) Culture is vital to organizational health. Intangibles such as the culture of the organization form an inviting environment that can attract and retain quality people; or create one that encourages people to be less productive or to leave. A positive culture has become a standard for global corporations, such as: American Express, Boeing, GE, H-P, IBM, SONY, Johnson & Johnson (3) Communication is strategic now more than ever. Many company executives consider communication as purely tactical in both its nature and its execution. In an information driven age, communication is an integral part of the corporate strategy. Strategic issues include an orientation of communication to an organizations priorities, as well as toward the external environment. Integrity and credibility are the pillars of strategic communication. Realistic measurement systems and processes for improvement are strategic tools for success. (4) The age gap between you and your employees must factor into your planning. Sixty-eight percent (68 per cent) of corporate executives in charge of public affairs and employee communication (internal and external) a large majority, are between 40 and 55 years of age. The workforce they manage is

overwhelmingly younger. A generation gap exists, but can be mitigated by applying the basic communication process, by conducting an audience analysis, and by focusing on the concerns of the workforce and the generation. (5) People in your workforce care more about themselves than the company. Members of the contemporary workforce have been told since high school, and by parents and elders, that corporate life is not forever and no job has a guarantee. Is it any surprise they practice enlightened selfinterest? How can a company expect employee loyalty in such an environment? (6) Your company is expected to be a good corporate citizen, as well as to make money. In the wake of diminished power among almost all power structures in our society religion, government, the family corporations have by default taken on a greater role in solving many of the ills of society. Social problems substance abuse, sexual harassment, child care, elder care have fallen to the corporations by default. (7) Media relations is more complex no more old boy system. In a 24/7/365 environment with scores of media outlets from newspapers to broadcast to the Internet, relationships with the media are no longer a matter of contacting a few old friends over a leisurely lunch. Each channel, each reporter demands a professional relationship built on credibility. (8) Internet is just a tool; Internet is a strategy truth is on the continuum. Any anthropologist will tell you that a new tool in a human system changes that system. So the Internet has changed dramatically the way people in corporations communicate internally and externally. It has at once created a sense of liberation, and also represents a constantly present taskmaster. (9) Speed is faster than it ever was. Experts compare an Internet year to a dog year. Is it any wonder that some of us seem much older than our years? The speed of life has us live several lives in one lifetime. (10) Your company will have a crisis; prepare for the ones you cant conceive of. Crisis planning is informed by the Boy Scout motto: Be prepared. The Boy Scouts,

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however, did not conceive that their recent court victory could have resulted in a crisis of their own funds drying up and communities barring their use of public facilities. Be prepared, indeed. (11) Writing is still the core skill for corporate communication. The Internet has underscored that writing of the highest order is still the major talent required of those who create and send the messages in and from our major corporations. Some of the findings of our research indicate some changes in how we communicate at work. Others indicate changes in relationships between you and your workforce, as well as changes between you and the community your company is in. Which brings us to our next question.

Table I Some of the results of the benchmark study Function Communication strategy Media relations Public relations Executive speeches Crisis and emergency Communication policy Annual report Corporate identity Internet communication Intranet communication Community relations Issues management Advertising Marketing communication Corporate culture Corporate philanthropy Employee relations Mission statement Investor relations Government relations Ethics code Labor relations Responsibility (%) 95.6 93.4 93.4 90.5 89.8 86.9 79.6 75.2 73.7 72.3 66.4 58.4 56.2 52.6 48.9 46.7 43.8 38.0 27.0 21.9 8.8 3.6 Budget (%) N/A 88.3 80.3 86.1 77.4 N/A 69.3 67.9 59.1 58.4 56.9 48.2 42.3 26.3 39.4 41.6 82.5 29.9 19.7 19.7 N/A 1.5

What is the role of business and communication?

Communication is what you do every day and that role has changed. It is more complex, strategic and vital to the health of your organization than it was yesterday, and will only gain in its importance in an information driven economy. It is tied to the messages you create for all your audiences internal and external, paying and non-paying. What are the functions of corporate communication? We asked in our benchmark study whether or not our corporate communication executives responsibilities and budgets included 24 communication functions such as annual report, crisis, employee relations, Internet, intranet, media relations, policy, strategy, and public relations. Some of the results are shown in Table I. These figures indicate substantial involvement of corporate communication executives in communication actions central to corporate growth and survival. The responses also indicate substantial budgetary responsibility for traditional communication functions and a shared or matrix role in forging important corporate relationships with customers, vendors, and investors. And just how big are the corporate communication budgets of the Fortune 1,000? Results from the benchmark study are shown in Table II.

Table II Corporate communication budgets of the Fortune 1,000 Percentage of Corporate communication budget ($) companies <500,000 500,000999,999 1,000,0004,999,999 5,000,0007,499,999 7,500,00010,000,000 >10,000,000 19.1 14.0 27.2 14.7 4.4 20.6

The Council on Public Relations Firms Spending Study asked more detailed questions about spending in the Fortune 500. The Spending Study found: (1) The typical corporate communication department in the study had a budget of $7.5 million and a staff of 10 professionals and three support staff. It was headed by a VP (often a senior or executive VP) who reported to the chief executive or chief operating officer, and expects next years budget and staffing will both increase. (2) The range of spending on corporate communication was very large: $285,000 to $100 million. The mean was $21.6 million

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(3) Among those companies whose budgets included them, the following were the largest line items: . corporate advertising ($11.4 million); . foundation funding ($8.1 million); . social responsibility ($4.65 million, including community relations, nonfoundation funding, etc.); . government relations ($4.2 million); . employee communications ($2.6 million); and . investor relations ($2.1 million). These figures underscore that playing the communication game at the Fortune 500 level requires substantial resources in professional staff and financial commitment.

What does this mean for the individual, and what is the challenge in meeting future change?
Chances are you got into corporate communication because you are a good writer a very good writer. But you realized early on that not too many paying jobs out there were called writer. No one advertises for poets, novelists, and short story writers. But writing for organizations is booming Web pages, newsletters, press releases, speeches. All those are still there. Now much more work for individuals acting as vendors is the result of outsourcing. We asked in our Benchmark Study how corporate communication executives used vendors and agencies for their work. The most commonly cited were: . advertising (75.9 per cent); . annual report (73.7 per cent); . Internet (46.0 per cent); . public relations (43.1 per cent); . identity (43.1 per cent); . media relations (40.1 per cent); . marketing communication (38.7 per cent); . crisis communication (28.5 per cent); . intranet (22.6 per cent); . investor relations (18.2 per cent); Only 8.8 per cent use a vendor for community relations and for issues management, and 6.6 per cent use a vendor for employee relations and for labor relations. Less than 5 per cent of companies use vendors for communication policy, corporate culture, mission statement, corporate philanthropy.

Creation of messages remains the work of the corporation itself with its own resources. It appears that vendors help with technology, production, distribution, and execution. For the individual practicing corporate communication the variety of functions and responsibilities indicates a broader set of skills beyond writing. And I do not mean the Internet, though that is an essential skill that you have mastered. How you use media all types of media to project your company message. How you relate interpersonally as a manager, as a colleague, as a corporate representative. How you teach and motivate. How you communicate to your colleagues that they are company ambassadors. Everywhere you go, you are you and your organization. You are your organization. That is a tough realization for the generation of self-absorbed employees. The success of the enterprise calls for them to be proud of their organization, even if their commitment is temporary. The model for your company is no longer a family. It is a community. Family implies a much different relationship, and a much more obligatory bond. Family, according to Frost, is the place that when you go there they have to take you in. Besides, divorce rates have remained constant, and contemporary family constellations are very complex. How many times have you seen someone with a person that just did not fit, and they may have said something like, Oh, yes this is my cousin, or, Yeah, hes my wifes uncles stepson visiting from Texas? By contrast, we have a different bond with community. We have a pride of place. We say, Im from Colorado Springs, or Im from Utah, or Boston, or Paris with lots of pride that comes from the context of place and community. Or I work for Ford or GE or IBM or Microsoft. We have a sense we have joined a community of people who share something different from what families do a culture.

What new tools do you need for your toolbox?

In addition to your excellent writing expertise, your superior interpersonal skill, your ability

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to create media products press releases, video, Web pages, magazine articles, newsletters other tools need to be in your professional toolbox to meet the challenge of change. You need the ability to: . teach; . absorb and comprehend vast amounts of complex information quickly; . create and build relationships internally and externally; . build trust in all your audiences; and . build a corporate culture. Teach The corporate communicator is taking over an HR role when it comes to motivating employees and that calls for you to be a teacher. To do that you need to be aware of the styles of adult learners, and we can begin to define adult for many tasks as anyone over 13. Experience is key to adult learning. Almost everyone knows of the person who learned to program a computer by his or herself, fix an automobile, or stereo system, or to have children and raise a family without the aid of formal schooling. So your relationship as a teacher with the workforce works best when it is collaborative. Absorb complex information quickly In times of challenge crises, emergencies, mergers, acquisitions, strikes the appetite for quality information by your own community and your corporate community is voracious. Stacks of information about the merger must be translated from lawyer and accountant speak to a language reasonably intelligent people understand. People with a background in the liberal arts developed a facility for complex ideas and information when they interpreted the novels of Dickens and Twain; or understood the monographs of Freud and Jung; or decoded the field studies of Mead; or commented on the observations of Churchill: or criticized the thoughts of Socrates and Confucius; or misread the essays of Derrida. Create and build relationships Building relationships was never that easy, but in simpler times the role of employee communication was given to trusted employees who knew almost everyone in the company because he or she had worked there since high school. In a family cultural model,

trust was institutionalized since everyone in the company was family. Relationships with the media were also built through recruiting reporters who had covered your company and hiring them to be the media relations representative. With the change to a corporate community model, you have to work at identifying the people who are important to the organization and then go about cultivating a relationship with them. Build trust How do you go about building trust? As country simple, and as emotionally difficult as being worthy of trust. People you interact with must have a sense of your integrity as the cornerstone of trust. Every positive interaction with people builds a reservoir of trust. It is cumulative, from simply showing up on time, to keeping your promises. On the other hand, integrity is something you can only lose once. Build corporate culture When your boss asks you to take a few days to change the culture of the company, stop a take a few deep breaths before you begin your lecture. You might ask if he or she has ever been swimming in the ocean and gotten caught in the receding tide, or felt the enormous pull of a rip tide. Or you might ask if they have ever been tossed around by a sudden gust of wind. A hurricane. A tornado. Culture is like the wind and the tide. It exerts very strong and often invisible forces. It has to be considered. We renovated, actually we are still in the process of renovating an old cottage in Maine that was ravaged by the forces of winter, water, and entropy. Cultures can be changed, but not instantaneously. And rapid culture changes are painful and destructive, like wars. We dont have to look too far a field to find destructive cultural changes that are slow to heal Ireland, the Middle East, Bosnia, Korea, Central Africa. The citizens of Georgia (US that is) still recall with anger the slash and burn policy of General Sherman during the Civil War. The British have no monument at Edgehill the site of the first battle of their Civil War to overthrow the King by Cromwell and the Roundheads over 350 years ago.

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What has changed in audiences and communication channels?

Globalization, women, Gen-X, Gen-Y, Gen-Z, Gen-Jones, the digital generation... Beloit College has for three years developed a Mindset List for professors to better understand freshmen (the members of the class of 2004). It has interesting statements such as: . Kurt Cobains death was the day the music died; . the Kennedy tragedy was a plane crash, not an assassination; . there have always been ATM machines; . spam and cookies are not necessarily foods; and . they feel more danger from having sex and being in school than from possible nuclear war. Developing and maintaining the organizations culture as part of your responsibility has added to the challenge of corporate communication. Your employees are no longer captives to your organization. They move often from job to job. They learned their lesson well from the experience of the decades of downsizing, restructuring, mergers and acquisitions. They were told in school and observed from their parents that corporations and organizations would not have a job for them for life. They were taught in high school and college to see each job as a learning experience for them to prepare for the next job in their career path. Service was selfservice, so they have no role models for understanding the concept of the value-added nature of customer relations. Enlightened self-interest was the appropriate way to think about their place in the world of work. They saw what happened to their fathers and mothers who committed themselves to work and a life of delayed gratification downsized at 55 just short of their pension and other benefits. Now your challenge is to motivate a generation of workers who have priorities vastly different from the priorities of the company. Work/life balance for corporation places work first. For the new workforce, work/life balance means life balance. When work does not fit, its time to move on. The low unemployment rate contributes to the validity of their approach to work.

Culture is also an essential understanding for the global workforce. You may understand the personality style preferences of your employees because you have their MeyersBriggs profiles. But an understanding of the influence of cultures from an anthropological perspective is also essential. Cognitive psychologists are challenging the assumptions about our individual habits of thought. They are questioning the belief that
... the strategies people adopted in processing information and making sense of the world around them ... are the same for everyone ... [that is] a devotion to logical reasoning, a penchant for categorization and an urge to understand situations and events in linear terms of cause and effect (Goode; 2000).

Your employees from counties such as Japan, China, and Korea seem to think holistically. At the risk of gross generalizations, they construct the world differently than Westerners do by paying more attention to context and relationships. Many also have an ability to hold contradicting thoughts simultaneously Yin/Yang. So your audience analysis challenge becomes even more complex. Keep in mind the Easterners born and raised in a Western environment show no clear preference for either rational or holistic thought as a result of strong competing cultural influences.

When all is said and done

With all the changes in the nature of work, the tools, the people, the companies, maybe some simple guidelines might be helpful. How about Nordstroms? They have two. (1) use your best judgement; and (2) see rule 1. Judgement, wisdom, understanding, integrity develop and rely on them.

References and further reading

Belkin, L. (2000), ``Lifes work, New York Times, 5 July, p. G1. Belkin, L. (2000), ``Buying Gen-Y (Series), Wall Street Journal , 9-11 August, pp. B1 and B4. ``Corporate Communication Benchmark Study (2000), Corporate Communication Institute, Madison, NJ, (www.corporatecomm.org)

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``Corporate Communication Spending Study (2000), Corporate Communication Institute for the Council for Public Relations Firms, Madison, NJ. Gardyn, R. (2000), ``Whos the boss? The new American worker,, American Demographics, September , pp. 53-9. Goode, E. (2000), ``How culture molds habits of thought, New York Times, 8 August, pp. 1 and 4. McClain, D.L. (2000), ``Forget the raise, give me some time off, New York Times, 5 July, p. G1.

``Remember when? This Falls freshmen may not (2000), Chronicle of Higher Education, 8 September , p. 10. Tahmincioglu, E. (2000), ``To shirkers, the days of whine and roses, New York Times, 19 July, p. G1. Tapscott, D. (1998), Growing Up Digital: The Rise of the Net Generation, McGraw-Hill, New York, NY. Wellner, AS. (2000), ``Generational divide, American Demographics , October, pp. 52-8. Wellner, A.S. (2000), ``Generation Z, American Demographics , September , pp. 61-64.

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