Corporate Communication

Corporate communication Perhaps the best way to define corporate communication is to look at the way in which the function has developed in companies. Until the1970s, practitioners had used the term „public relations‟ to describe communication with stakeholders. This „public relations‟ function, which was tactical in most companies, largely consisted of communication with the press. „Corporate‟ originally stems from the Latin words for „body‟ (corpus) and for „forming into a body‟ (corporare), which emphasize a unified way of looking at „internal‟ and „external‟ communication disciplines. That is, instead of looking at specialized disciplines or stakeholder groups separately, the corporate communication function starts from the perspective of the „bodily‟ organization as a whole when communicating with internal and external stakeholders.

Corporate communication, in other words, can be characterized as a management function that is responsible for overseeing and coordinating the work done by communication practitioners in different specialist disciplines, such as media relations, public affairs and internal communication. Van Riel defines corporate communication as „an instrument of management by means of which all consciously used forms of internal and external communication are harmonized as effectively and efficiently as possible‟, with the overall objective of creating „a favourable basis for relationships with groups upon which the company is dependent‟. Defined in this way, corporate communication obviously involves a whole range of „managerial‟ activities, such as planning, coordinating and counselling the CEO and senior managers in the organization as well as „tactical‟ skills involved in producing and disseminating messages to relevant stakeholder groups. Overall, if a definition of corporate communication is required, these characteristics can provide a basis for one: “Corporate communication is a management function that offers a framework for the effective coordination of all internal and external communication with the overall purpose of establishing and maintaining favourable reputations with stakeholder groups upon which the organization is dependent.”

Corporate communication is a set of activities involved in managing and orchestrating all internal and external communications aimed at creating favourable point-of-view among stakeholders on which the company depends.[1] It is the messages issued by a corporate organization, body, or institute to its audiences, such as employees, media, channel partners and the general public. Organizations

aim

to

communicate

the

same

message

to

all

its stakeholders,

to

transmit coherence, credibility and ethic. Corporate Communications help organizations explain their mission; combine its many visions and values into a cohesive message to stakeholders. The concept of corporate communication could be seen as an integrative communication structure linking stakeholders to the organization.

Methods and Tactics Three principal clusters of task-planning and communication form the backbone of business and the activity

of

business

organizations.

These

include management

communications, marketing

communications, and organizational communications. 

Management communications are between management and its internal and external audiences. To support management communications, organizations rely heavily on specialists in marketing communications and organizational communications.

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Marketing communications get the bulk of the budgets in most organizations, and consist of product advertising, direct mail, personal selling, and sponsorship activities.

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Organizational communications consist of specialists in public relations, public affairs, investor relations, environmental communications, corporate advertising, and employee communications.

The responsibilities of corporate communication are: 

to flesh out the profile of the "company behind the brand" (corporate branding)

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to minimize discrepancies between the company's desired identity and brand features

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to delegate tasks in communication

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to formulate and execute effective procedures to make decisions on communication matters

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to mobilize internal and external support for corporate objectives

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to coordinate with international business firms

A Conference Board Study of hundreds of the US‟s largest firms showed that close to 80 percent have corporate communication functions that include media relations, speech writing, employee communication, corporate advertising, and community relations. The public is often represented by self-appointed activist non-governmental organizations (NGOs) who identify themselves with a particular issue. Most companies have specialized groups of professionals for communicating with different audiences, such as internal communications, marketing communications, investor relations, government relations and public relations.

The Scope of Corporate Communication Organisations use corporate communication to convey identity, build brands and to develop reputation. Strategically corporate communication is used to reduce stakeholder uncertainty and to develop stakeholder relationships. Through the development of positive relationships where there is understanding, trust, reciprocity and collaboration, participant organisations are better placed to achieve their goals, whether they are normative (eg social contracts, environmental responsibilities, community acceptance) or instrumental (eg profit, sales, roi, performance). Where there are neutral or negative relationships, or a gulf between identity and image, corporate communication has to work harder to narrow the gap. For example, organisations such as the airline SAS, use corporate communication to help change the way staff engage with the organization following a period significant strategic uncertainty. Exploring the scope of any subject can often be initiated by examining the definitions offered by scholars who have specialized in the topic. Several definitions are presented and considered here, spanning the period 1987 to 2007.

Although there are several texts in which corporate

communication makes a substantial contribution, the focus is often on reputation and branding

activities. In these circumstances corporate communication is not defined. The following definitions have been identified in corporate communication texts. These are not the only books and definitions on this subject but they are considered to be representative of some of the leading authors and researchers in this area. “Corporate communication is the total communication activity generated by a company to achieve its planned objectives” (Jackson, 1987). “the aggregate of sources, messages and media by which the corporation conveys its uniqueness or brand to its various audiences” Gray (1995: 254)

Corporate communication is an instrument of management by means of which all consciously used forms of internal and external communication are harmonized as effectively and efficiently as possible, so as to create a favourable basis for relationships with groups upon which the company is dependent (Riel van, 1995: 26). “Corporate communication is the set of activities involved in managing and orchestrating all internal and external communications aimed at creating favourable starting points with stakeholders on which the company depends. Corporate communication consists of the dissemination of information by a variety of specialists and generalists in an organization, with the common goal of enhancing the organization’s ability to retain its license to operate” (Riel van and Fombrun, 2007: 25).

In the two books in which van Riel offers his definitions, stress is given to the importance of using the singular form of communication, a position initiated by Jackson (1987). This, it is argued, emphasises the integrative function of communication rather than imply a proliferation of methods . This stance echoed by Cornelissen (2008). “Corporate communication is a management function that offers a framework for the effective coordination of all internal and external communication with the overall purpose of establishing and maintaining favorable reputations with stakeholder groups upon which the organization is dependent”(Cornelissen, 2008:5). Cornelissen acknowledges the complexity associated with corporate communication and he also stresses the importance of seeing corporate communication as an integrative function. Corporate communication is not the same as public relations and other specialized communication activities, such as branding, media relations and internal communications. Cornelissen regards corporate communication as a means of crossing over these specialist activities in order to “harness the strategic interests of the organisation at large” (2008: 6). This view is not shared with Lowensberg

(2006: 253). He considers the term corporate communications means the same as organisational public relations, and prefers the latter as the word corporate can be misleading and suggests an applicability to profit only „corporations‟. Apart from an increasing word count as definitions emerge, an examination reveals a gradual change in orientation. From what is essentially an inward perspective proposed by Jackson in 1987, Cornelissen‟s view twenty years later, stresses the importance of the reputation with which the organization is perceived by stakeholders. The organization itself is perceived to be the self serving focus for Jackson‟s perspective of corporate communication. For Cornelissen, the organisation conducts corporate communication in order to sustain a reputation and a desire to remain subservient to the wishes of the key stakeholders.

Importance of Corporate Communication Corporate Communication is the method by which large and medium size companies communicate with customers, stakeholders and employees.The reputation of a company and its products are built through the messages disseminated by the company to employees, customers and the public.

Corporate communication makes the company visible and gives its products an image and reputation a customer can identify with. Customers and employees also get to know - and feel good - about the company they are working for and doing business with.

Customers need to know about the company; its management; its method of manufacture; its mode of functioning, and the company‟s philosophy and values. They need to know its products and services so that they can trust what the company stands for and confidently buy, consume and use their products. Stakeholders -- investors, shareholders, partners and suppliers, employees, government, NGO‟s, local community, industry and customers -- any individual or group which can affect or be affected by an organisations activities need to feel a sense of involvement with what the company is doing, the more they know, and the more open the communication with them, the more they trust, and feel involved and responsible for the company in which they have a stake.

Employees are most important to the organisation; without them the company cannot run. Both the management and employees must appreciate this interdependence. So, both management and

employees at all levels must develop a sense of inclusion, a sense willing cooperation and a united pursuit of the company‟s values and goals. This is done through two-way internal communications up and down the hierarchy

Components: Corporate branding A corporate brand is the perception of a company that unites a group of products or services for the public under a single name, a shared visual identity, and a common set of symbols. The process of corporate branding consists creating favourable associations and positive reputation with both internal and external stakeholders. The purpose of a corporate branding initiative is to generate a positive halo over the products and businesses of the company, imparting more favourable impressions of those products and businesses. In more general terms, research suggests that corporate branding is an appropriate strategy for companies to implement when: 

there is significant "information asymmetry" between a company and its clients; That is to say customers are much less informed about a company's products than the company itself is;

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customers perceive a high degree of risk in purchasing the products or services of the company;

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features of the company behind the brand would be relevant to the product or service a customer is considering purchasing.

Corporate and organizational identity There are two approaches for identity: 

Corporate identity is the reality and uniqueness of an organization, which is integrally related to its external and internal image and reputation through corporate communication

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Organizational identity comprises those characteristics of an organization that its members believe are central, distinctive and enduring. That is, organizational identity consists of those attributes that members feel are fundamental to (central) and uniquely descriptive of (distinctive) the organization and that persist within the organization over time (enduring)".

Four types of identity can be distinguished: 

Perceived identity: The collection of attributes that are seen as typical for the „continuity, centrality and uniqueness‟ of the organization in the eyes of its members.

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Projected identity: The self presentations of the organization‟s attributes manifested in the implicit and explicit signals which the organization broadcasts to internal and external target audiences through communications and symbols.

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Desired identity (also called ‘ideal’ identity): The idealized picture that top managers hold of what the organization could evolve into under their leadership.

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Applied identity: The signals that an organization broadcasts both consciously and unconsciously through behaviors and initiatives at all levels within the organization.

Corporate responsibility Corporate responsibility (often referred to as corporate social responsibility), corporate citizenship, sustainability, and even conscious capitalism are some of the terms bandied about the news media and corporate marketing efforts as companies jockey to win the trust and loyalty of constituents. Corporate responsibility (CR) constitutes an organization‟s respect for society‟s interests, demonstrated by taking ownership of the effects its activities have on key constituencies including customers, employees, shareholders, communities, and the environment, in all parts of their operations. In short, CR prompts a corporation to look beyond its traditional bottom line, to the social implications of its business.

Corporate reputation Reputations are overall assessments of organizations by their stakeholders. They are aggregate perceptions by stakeholders of an organization's ability to fulfill their expectations, whether these stakeholders are interested in buying the company's products, working for the company, or investing in the company's shares. In 2000, the US-based Council of PR Firms identified seven programs developed by either media organizations or market research firms, used by companies to assess or benchmark their corporate reputations. Of these, only four are conducted regularly and have broad visibility: 

"America's Most Admired Companies" by Fortune Magazine;

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The "Brand Asset Valuator" by Young & Rubicam;

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"RepTrak" by Reputation Institute.

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"Best Global Brands" by Interbrand.

Crisis communications Crisis communication is sometimes considered a sub-specialty of the public relations profession that is designed to protect and defend an individual, company, or organization facing a public challenge to its reputation. These challenges may come in the form of an investigation from a government agency,

a criminal allegation, a media inquiry, a shareholders lawsuit, a violation of environmental regulations, or any of a number of other scenarios involving the legal, ethical, or financial standing of the entity. The crisis for organizations can be defined as follows: A crisis is a major catastrophe that may occur either naturally or as a result of human error, intervention, or even malicious intent. It can include tangible devastation, such as the destruction of lives or assets, or intangible devastation, such as the loss of an organization's credibility or other reputational damage. The latter outcomes may be the result of management's response to tangible devastation or the result of human error. A crisis usually has significant actual or potential financial impact on a company, and it usually affects multiple constituencies in more than one market.

Internal/employee communications As the volume of communications grows, many companies create an employee relations (ER) function with dedicated staff to manage the numerous media through which senior managers can communicate among themselves and with the rest of the organization. Internal communications in the 21st century is more than the memos, publications, and broadcasts that comprise it; it‟s about building a corporate culture on values that drive organizational excellence. ER specialists are generally expected to fulfill one or more of the following four roles: 

Efficiency: Internal communication is used primarily to disseminate information about corporate activities.

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Shared meaning: Internal communication is used to build a shared understanding among employees about corporate goals.

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Connectivity: Internal communication is used mainly to clarify the connectedness of the company's people and activities.

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Satisfaction: Internal communication is used to improve job satisfaction throughout the company.

Investor relations The investor relations (IR) function is used by companies which publicly trade shares on a stock exchange. In such companies, the purpose of the IR specialist is to interface with current and potential financial stakeholders-namely retail investors, institutional investors, and financial analysts. The role of investor relations is to fulfill three principal functions: 

comply with regulations;

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Create a favorable relationship with key financial audiences;

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Contribute to building and maintaining the company's image and reputation.

Public relations: issues management and media relations The role of the public relations specialist, in many ways, is to communicate with the general public in ways that serve the interests of the company. PR therefore consists of numerous specialty areas that convey information about the company to the public, including sponsorships, events, issues management and media relations. When executing these types of activities, the PR Specialist must incorporate broader corporate messages to convey the company‟s strategic positioning. This ensures the PR activities ultimately convey messages that distinguish the company vis-à-vis its competitors and the overall marketplace, while also communicating the company‟s value to target audiences. 

Issues management

A key role of the PR specialist is to make the company better known for traits and attributes that build the company‟s perceived distinctiveness and competitiveness with the public. In recent years, PR specialists have become increasingly involved in helping companies manage strategic issues – public concerns about their activities that are frequently magnified by special interest groups and NGOs. The role of the PR specialist therefore also consists of issues management, namely the “set of organizational procedures, routines, personnel, and issues”. A strategic issue is one that compels a company to deal with it because there is “ a conflict between two or more identifiable groups over procedural or substantive matters relating to the distribution of positions or resources”. 

Media relations

To build better relationships with the media, organizations must cultivate positive relations with influential members of the media. This task might be handled by employees within the company‟s media relations department or handled by a public relations firm. 

Company/spokesperson profiling

These "public faces" are considered authorities in their respective sector/field and ensure the company/organization is in the limelight. 

Managing content of corporate websites and/or other external touch points

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Managing corporate publications - for the external world

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Managing print media