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-- Jon Harmon

How to put strategic communications into practice to set your business on a winning trajectory

Seventh in my series on strategic communications.

My central point has been that truly strategic communications can be more than just proactive ... and more than just closely wired to the corporate strategy. Truly strategic communications can be an ongoing input into the corporate strategy and indispensable to its execution. Corporate strategy aiming to be transformational needs the communication strategy to be a dynamic driver, helping to propel the business to a higher plane.

That's good in theory. But just how does that work in practice?

Here are two critical connection points between communication strategy and corporate strategy -- where communications can drive results so fundamentally that the Corporate Strategy function would be remiss in not actively courting Communications "to the table" as it establishes objectives and strategic plans:

Internal transformation--Becoming an innovation leader. Unless your company is already fully functioning as a living, breathing mecca of innovation, fully engaged in a learning cycle delivering continual transformation for sustainable competitive advantage, it probably needs a steady dose of active culture change. Senior management, informed by forward-thinking Human Resources (no, that doesn't have to be an oxymoron) and Communications leaders, pushes the organization out of its comfort zone for truly creative innovation. HR must revamp evaluation and compensation processes to reward smart risk-taking, breakthrough thinking and creativity while fostering cooperation and teamwork (we aren't looking for me-first all-stars, but individuals whose passion, energy and creativity helps makes everyone better). And Communications actively promotes candid, sharp, timely and specific communication throughout the organization. Everyone knows senior management's vision and strategic priorities, and knows that their ideas are actively sought and valued. Together, HR and Communications aim not just for effective internal communication, but active and productive internal engagement.

Reputation management--Beyond protecting the brand. Top-performing companies know the value of a strong brand (and not just consumer companies; a vibrant brand drives sales success in a B-to-B environment as well). But reputation management is on an even higher plane of importance than brand management. Companies not considered trustworthy drop off customers' consideration lists, preempting an opportunity for the brand to gain traction as a sales motivator. Active reputation management makes brand enhancement possible. Marketing and Communications should work actively to help drive reputation and brand valuation upward. But that's more than just a matter of communicating well to the marketplace (media relations, social media participation, marketing and advertising). The company's actions must match its words just as its products must measure up to its marketing claims. Communications leaders provide an active voice in strategic and operational meetings as the company's reputational conscience. (The Chief Communications Officer may be more appropriately renamed the Chief Reputation Officer, as I have suggested here since 2006.) Yes, the company's reputation is every leader's responsibility, but the senior Communications leader is its unceasing advocate. (Just as financial accountability and stewardship is every leader's responsibility but the CFO keeps it his/her singular focus).

These two strategic priorities--developing and maintaining a high-performance culture, and protecting and enhancing corporate reputation among all key stakeholders--are critical to your company's long-term success, are they not? Can you really achieve excellence without them? So ... is strategic communications an active and valued input in your corporate strategy?

- Jon Harmon

Author, expert Walter Kiechel weighs in: communications key to success of corporate strategy

A notable voice weighs in on my continuing series on strategic communications. 

I've been in correspondence with Walter Kiechel, author of the very insightful The Lords of Strategy, which details the birth and development to the present day of the concept of corporate strategy. (See my blog posts: here, here, here and here).

Here's his take on the major points I've raised on this blog (that communications can and should be "strategic," and that a direct link between the communications plan and the business plan is essential but only the beginning--communications strategy should be an input into the corporate strategy, not merely a conduit for executing the srategy):

Jon, I enjoyed reading the blog posts, and think you make a number of good points: communications should be used as a strategic weapon, companies ought to have the communications function at the table where these decisions are made, and yes, particularly if I had had another 50 pages or so available to me, I probably should have written more about the place of communications in the history of strategy (besides the fairly limited coverage of BCG's marketing with Perspectives, and the business book business as it had evolved by the late '80s).

If there had been more consciousness of communications, up and down within the organization, and maybe with outside constituencies as well, fewer strategies would have proven impossible to execute, I suspect.

Anyway, keep up the good work.

All the best,
Walter

Corporate strategy advanced ... but left communications behind

Fifth in a series on strategic communications.

At each stage in the evolution of corporate strategy as a discipline over the past two to three decades--from an emphasis on "positioning" to "process" and now to "people"--its dependence on equally strategic communication has become more essential.

But strategic communications as a discipline has not kept pace. And neither have the bright minds driving the strategy trains inside corporations or the leading consulting firms grasped the rapidly escalating need for communication strategy to mature as an essential input into corporate strategy.

Let's take a look at the evolution of strategy from the eyes of a corporate communicator:

• Positioning--As the "father of competitive strategy," Harvard's Michael Porter defined strategy as positioning. "Operational effectiveness" shouldn't be confused with strategy, he said. "Competing to be the best" equates to "running the same race faster." Strategic positioning is "creating a unique and sustainable competitive advantage," that is, "choosing to run a different race." Years ago, Hewlett-Packard pioneered a strategy aimed at market dominance of small printers for personal computers--HP would follow the classic Experience Curve model of a market leader driving down its prices to drive share and volume gains, in turn lowering its costs even further. In fact, HP would sell its printers at a loss in anticipation of building a highly profitable business selling expensive ink cartridges to its printer customers. HP's strategy wasn't to maximize its share of "printer units sold" but its "share of pages printed." HP's competitors have been forced to follow this strategy, resulting in both a price war for printers and sticker shock for customers needing replacement ink cartridges (leading to this less-than-forthright explanation from HP). This market dynamic creates an opportunity for a daring competitor to seek a counter positioning strategy: Kodak in 2007 began to sell its printers for a premium with the promise of low-cost replacement ink cartridges. Aimed especially at the "big burners" (customers printing lots of pages), the strategy has been only partially successful. Clearly the strategy works only to the degree it is communicated effectively--customers are willingly to pay a premium for a printer only if they are attracted to the appeal of lower ink costs. Advertising, point-of-purchase displays and successful PR (including participation in social media) should all be aimed at communicating the benefit of low cost ink, and, importantly,tapping into the anger of customers outraged by high ink costs. A smart, fully integrated, emotional communications blitz strategically aimed at outraged customers would be much more successful than the staid campaign Kodak has pursued. It's a mistake to attempt marketplace positioning without a strategy actively positioning within the sphere of customer awareness. Communications should not have been merely a conduit of Kodak's positioning strategy, it should have been one of its pillars.
• Process--Total Quality Excellence, Re-engineering, ISO and black belt certification and the like are systematic efforts to wring out further improvements in productivity and product quality.
  Relentlessly reducing costs and shortening cycle times are critical to survival in competitive industries, and what industry today isn't competitive? But process improvement isn't enough--except for market leaders selling commodities solely on price who can exploit scale advantages over their competitors. Eliminating waste and shaving costs are important, but they amount to what Porter called "running the same race faster," and Walter Kiechel calls "Greater Taylorism." Not very inspiring as strategy or battle cry, and therefore unlikely to prove transformative.
• People--Today more than ever, competitive advantage is fleeting. Globalization and the ever-quickening pace of technological advancement (e.g., Moore's Law) allow competitors to leap-frog complacent market leaders. Contemporary corporate strategy focuses on capabilities and competencies, rather than current product advantage. Strategy aims to unleash the creative power of the team. And the team may be defined broadly to include customers, as in the case of open-sourced technology development, such as apps for mobile devices. (The greater availability of free apps for Android will be a critical competitive advantage vs. Apple's I-phone.) In this paradigm, information is power not when it is protected, but when it is shared broadly. Cloud-computing can make formerly proprietary resources available to anyone in the world, and facilitate the rapid generation of ideas into concepts, concepts into products, products into social fads, and, perhaps, fads into adaptive (and therefore lasting) cultural icons. Sharing information and encouraging individual expression are foreign concepts for most corporate managers--and, therefore, true culture change will become an ever-more important element of strategy. Corporations traditionally have been designed to enforce norms of behavior and productivity through top-down authority. Actively urging people to push beyond the expected requires a shock to the system. "Innovative," "creative" and "entrepreneurial" aren't just buzz words; they describe the essence of people-centered enterprises built to continually produce competitive advantage.

Next: Enough with the concepts already! How can strategic communications deliver results NOW?

- Jon Harmon

 

The compelling corporate strategy of aiming higher

Fourth in a series on communications strategy.

That most democratic of encyclopedias, Wikipedia, defines strategic communication as "communication aligned with the company's overall strategy, to enhance its strategic positioning."

Most corporate communicators, I would imagine, would take little issue with this straight-forward definition. But I believe it falls short in two critically important ways:

First, it asserts that communication becomes "strategic" by being aligned with corporate strategy. Certainly, this alignment is fundamental, as I've stated in the previous posts in this series. But communication should also be strategic itself, and it should be an important input into the formulation of the corporate strategy. Corporate strategists should not develop the game plan in a vacuum, then hand a copy of their meeting minutes to the head of PR with the command: "Go forth and align your communication plans to this!"  (More in my next post about the importance of reputation management being actively present "at the table" helping to develop and execute corporate strategy.)

Second, global competitive forces have pushed corporate strategy to out-grow its old-school definition linked to "strategic positioning." Strategy not only is about developing a long-term game plan to successfully position the company in terms of cost, customer and competition--it also provides the dynamic piloting of an adaptive, learning organization. It's less about paddling a boat across a calm lake than about guiding a crew of rafters down a white-water river with not-always-predictable currents.

The need for strategy to be dynamic is readily apparent when the rules of engagement change in visible ways (a new competitor arrives on the scene; a new regulatory environment creates constraints and opportunities; a disruptive invention alters the basic assumptions of the industry).  Equally obvious is the observation that few strategies are executed exactly as envisioned, and communications plans may need to be altered along the way. You make course corrections to a message strategy to reflect the new realities while staying true to the corporation's enduring values (easier said than done).  

But there is a deeper reason for dynamic strategy beyond adaptive course correction. Adaptive learning keeps the strategy relevant as the game changes, but what Peter Senge called "generative learning" provides meaning to the enterprise essential to the full engagement of its people. The corporation does not execute its strategy with faceless automatons but with thinking, reasoning and feeling individuals with varying degrees of commitment and engagement. The organization is at its best when its people are fully involved, taking ownership in the meaning of their work, knowing that "someone at the top" is listening to their observations and thoughtfully considering their ideas.

When you ask people about what it is like being part of a great team, what is most striking is the meaningfulness of the experience. People talk about being part of something larger than themselves, of being connected, of being generative. It becomes quite clear that, for many, their experiences as part of truly great teams stand out as singular periods of life lived to the fullest.  (Senge, The Fifth Discipline: The Art and Practice of The Learning Organization, 13)   

For Senge (named a ‘Strategist of the Century’ by the Journal of Business Strategy), the learning organization excels because it encourages its people in their individual quest for deeper understanding, aligned with the values and objectives of the enterprise. (Therefore, I would add, strategic communications aim to foster the active engagement of employees and other stakeholders in the dynamic development and implementation of ideas critical to the success of the enterprise.) Senge identifies in individuals a thirst for ever-higher levels of excellence in their work, something he called "personal mastery." Mastery isn't the achievement of perfection in the tasks that make up our work but the continual striving itself:

People with a high level of personal mastery live in a continual learning mode. They never ‘arrive’. ...It is a process. It is a lifelong discipline. People with a high level of personal mastery are acutely aware of their ignorance, their incompetence, their growth areas. And they are deeply self-confident. Paradoxical? Only for those who do not see the ‘journey is the reward’. (Ibid: 142)

A long-term corporate strategy could deliberately seek to create a culture of innovation and deep personal commitment to a higher mission. It would identify clear markers of success along the way to provide direction and the means of accountability, but its focus would be on a compelling vision. 

When there is a genuine vision (as opposed to the all-to-familiar ‘vision statement’), people excel and learn, not because they are told to, but because they want to. But many leaders have personal visions that never get translated into shared visions that galvanize an organization… What has been lacking is a discipline for translating vision into shared vision - not a ‘cookbook’ but a set of principles and guiding practices....The practice of shared vision involves the skills of unearthing shared ‘pictures of the future’ that foster genuine commitment and enrolment rather than compliance.. (Ibid: 9)

Corporate communications, strategically aimed at fostering this "genuine commitment" through generative learning, plays a pivotal role in developing this culture of excellence. And that in turn, provides deeper meaning and satisfaction to the role of communicator. And that sure beats writing predictably boring copy for the employee magazine or the Annual Report!

- Jon Harmon 

Brands that don't ring true become roadkill

Third in a series on communications strategy.

The first major strategic insight at the Boston Consulting Group, which pioneered the concept of business strategy in the 1960s, was the "experience curve," writes Walter Kiechel in The Lords of Strategy. A company with dominant share in an industry will have the lowest costs, and, therefore, can lower its prices to gain further share, driving its costs even lower, allowing it to protect its dominant position versus competitors who remain at a perpetual cost disadvantage.

This most basic insight propelled BCG into consulting superstardom and its clients to greater marketshare and profitability. Like a law of nature, the experience curve was seen as constant and inviolable. But a closer look reveals it to hold water only for commodities competing solely on price. It fails to account for non-price distinctions customers make on many, if not most, purchases. "Brand" is the essence beyond commodity that allows favored products to sell for substantial premiums over generics (for example, bottled water where brand and packaging are the most notable distinctions between competitors). "Corporate reputation" is the halo of trust and respectability engendered by upstanding companies, or the millstone of disrepute and suspicion hanging over products offered by companies tainted by poor reputation.  Without a passing corporate reputation, brands exist outside many customers' consideration set; that is, brands cease to exist for these customers.

"Brand" and "reputation" cause substantial market distortion for the strategist expecting share to be determined solely by price.  But they are fundamental to the choices customers make every day and, therefore, they are tangible and real. For the sellers of most products and services, cultivating brand value and protecting/enhancing reputation are as important as any aspect of business and require as much forethought and deliberate execution as any element of strategy.   

Let's look again at the three basic elements of strategic positioning: cost, customer and competition.

Cost: Selling purely on price is seldom a winning strategy. Desirable characteristics of a product (or service), especially those that are truly unique, add value that enables the product to be sold at a premium, or to dominate the market. Desirability is the measure of the strength of a brand, and communication (advertising, other forms of marketing communications, media coverage, social media "buzz", etc.) helps the brand resonate with the customer.

Customer: "Markets are conversations," (meaning that conversations among customers and potential customers shape, even define, brands) was the opening thought of The Cluetrain Manifesto, way back in Web 1.0 at the turn of the century. It's even more true today. Brand management is less about crafting a clever identity and shouting it from the highest hill at whomever will hear it, than it is engaging in authentic conversations with real people.

Competition: You aren't alone in wanting to engage in market conversations. Your competitors are working overtime. Fortunately for you, most of them are still shouting at the market, they're just using Twitter and YouTube to do their shouting. If you can help the market of people "out there" discover your product, and if you invite them inside your brand--and they like what they find there--you will be well ahead of your competition. Companies whose brands aren't seen as authentic will end up as reputational roadkill.

Next post: The learning organization and dynamic strategy.

- Jon Harmon

Corporate communication should be a strategic weapon

Second in a series on communication strategy.

The first step toward truly strategic communications is to align integrated communications objectives and plans with the corporate strategy. The focus of communications efforts--internal communications, marketing communications (including social media) and corporate media relations--should match the focus of annual and longer-term business plans. The corporate operating committee should view communications as a vital function for executing these business plans. In fact, the business should view its communications function as a critical competitive advantage. Too often, it does not.

As corporate strategy has evolved in sophistication, reliance on strategic communication should have become more fundamental--yet too often communication is nearly completely overlooked as anything more than window dressing. 

In the otherwise brilliant The Lords of Strategy,Walter Kiechel overlooks communication as he traces the progression of corporate strategy from a focus on corporate positioning to a dynamic piloting of an adaptive, learning organization. Kiechel's insightful opus from 2010, subtitled The Secret Intellectual History of the New Corporate World, includes almost no mention of communications or public relations. Neither does his provocative blog, The Strategic Eye. (Searching the blog for "communications" yields this one result; "public relations" gets you these two; none are germane to the importance of communications in contemporary corporate strategy).

With apologies to Kiechel, let me overlay some simple thoughts on how communications can propel the success of the business strategy. In subsequent posts, I'll provide some thinking on the advantages of strategic thinking to the communications function itself, beyond mere alignment with the business strategy.  

Corporate strategy aimed at "positioning," Kiechel writes, develops targets for success in the marketplace regarding cost, customer and competition. I would add that forward-looking ccommunications plans should be developed to support each of these areas of focus:

Cost: The corporate strategy aims to positions the primary brand(s) in the marketplace--as a value-leader, for example, or as a premium brand. For established brands, the strategic process begins by determining how the market perceives the brand, and may include plans to establish a clear brand positioning, or to try to move its positioning (often up-market). All communication to the market should be appropriate/authentic to the brand's price positioning in terms of tone, style, frequency and subject matter.

Customer: The business strategy aims to identify customer markets (geographic as well as demographic/psychographic) where the brand will be successful. This includes indentifying markets that need to defended against encroaching competition, markets that need to be further conquested for the brand to achieve growth objectives, etc. Communications should specifically target high-value markets, emphasizing brand strengths most relevant to those markets with communication authentic to those customer groups. Particular attention should be paid toward communicating genuine brand and product strengths that are not fully recognized by target markets.

Competition: Corporate strategy candidly assesses the company's brand strengths vs. current and on-coming competitors' brands, particularly mindful of how new or resurgent competitors may be changing the landscape. Communications excellence should be a key enabler to the strategic drive to stay ahead of even the most nimblest competitors. Media relations is largely a zero-sum game--you and your competitors compete rather directly for a fixed amount of media coverage each news cycle. Elbowing your way into a New York Times story on your industry with a lively and relevant anecdote likely means less mention for your competitors.

- Jon Harmon

Communication strategy should not be an oxymoron

First in a series.

As a communications consultant, I'm struck by how often senior executives are disappointed in their public relations functions' ability to meet even low expectations. Corporate leaders are frustrated that their communication teams are slow to react, do not take initiative, and produce less-that-desired results in terms of positive media coverage or marketing support. Internal communications deliver messages from on high, as instructed, but are not moving the needle, in any measurable way, toward educating employees on the corporate mission and strategy. And no wonder: PR is disconnected from corporate strategy and operates without much regard to supporting the objectives in the business plan.

The problem may be that corporate leaders are aiming far too low in deliverables expected from their communication function. Certainly, PR should be proactive, anticipating opportunities and executing quickly and sharply. And communications, internal and external, should closely coordinate with the business to focus on vital issues and areas of anticipated growth. The stakeholders to whom the communications team aims to reach should reflect the present and the future, not the past.

(If your PR capabilities do not measure up to the expectations outlined in the previous paragraph, congratulations. Your business can realize significant, tangible benefits quickly -- you just need to invest in a wholesale up-grading of communications. Start by examining its budget. Companies that view communications as overhead (as opposed to a vital contributor to the business) get what they pay for. And I bet you cut that meager investment further during the Great Recession, right?)

A winning company expects and demands competent, proactive communications from a PR team tirelessly working to tell the company's stories internally and externally, in sync with business strategies.

But that should just be the beginning. When a business leader says, "I want my communications team to be more strategic," he (she) generally wants the PR folks to plan ahead better, to take advantage of known coming events and maybe even to check in with corporate strategy once in a while to begin working on the promotion of products coming in the near future (or to put less emphasis on products soon to be phased out).   

All well and good, but none of that begins to rise to the level of being "more strategic." A communications function that is truly strategic works actively to protect and enhance corporate reputation, and to advance employee engagement. ("Employee engagement" is a higher calling than "employee communication" -- employees not only knowledgable about the company's strategy but actively involved in its execution, continually providing feedback as well as creative ideas for fully realizing the strategy.)

It begins with knowing the difference between having a strategy and having a well-developed calendar. Communication strategy is connected to (and is, in fact, a vital input to) corporate strategy, not just a proactive means to convey the company's strategy to various audiences.

"Communication strategy" as such is a foreign concept at most companies, including large and well-respected ones. It represents a new frontier to be developed and exploited, just as total quality management (remember that?) helped companies that had been paying lip service to quality.

I will further develop the concept of "communication strategy" in coming days and weeks.

- Jon Harmon

Visionary leaders help others see past the gloom and doom

Last night as I watched President Obama’s speech, I kept thinking about how the global economic meltdown has become the defining issue of the day, shaping the way we talk about everything. And it made me wonder how effectively companies are communicating to their employees and to other essential audiences: customers and potential customers, shareholders and analysts, suppliers and policy makers.

Whether a person voted for him or not, one has to be moved by Obama’s hope-filled vision. Americans, indeed, are “not a nation of quitters.” And they respond well when a leader stirs their best and brightest instincts, rather than their fears. I believe that employees and external stakeholders alike will respond to corporate leaders who can sincerely articulate a confident vision of success – diligent effort during the downturn aimed at true distinction in the better days ahead.    

Too many business leaders seemed focused only on slashing costs to survive the crisis. But burning the furniture to heat the house is self-defeating. So is focusing all attention on cost-cutting. Productivity from your shell-shocked, demotivated employees will sink your enterprise further.

Leaders who can articulate a winning approach for both slopes of the business cycle will stand out when others seem only capable of wringing their hands.

And expert communications professionals can help these visionary leaders hit the mark with all audiences and stakeholder groups.

Strategic communications can help drive market leadership through crisp and consistent messaging. We start by asking:  Are our messages on the mark?  Are external product communications consistently aimed at driving sales performance, fully integrated into our marketing mix model? Are we quantifying that contribution and holding ourselves accountable for it? Do our internal communications successfully engage our employees, providing them a sense of confident urgency to seize the opportunity at hand?

I believe these questions are quite pertinent in today’s extremely challenging environment with companies slashing budgets and demanding strong, tangible results from their staff functions.

- Jon Harmon

Reputation Officer Can Be A Solid Operational Leader

Chrysler's hiring of former Toyota exec Jim Press to be its new President and Vice Chairman is a move PR professionals everywhere can cheer. Press made his mark at Toyota North America as its chief public relations officer before taking on operational responsibilities as Toyota's highest ranking gaijin, I mean, non-Japanese exec.

Why is it surprising that a very capable and well-respected PR pro can ascend to lead a major corporation's operations? After all, reputation is undeniably any company's greatest asset, so shouldn't its Chief Reputational Officer be at least as likely a CEO-in-waiting as its Chief Financial Officer?

Regular and long-time Force for Good readers may be experiencing déjà vu. At risk of being both redundant and self-congratulatory, here is an excerpt from a post this past March 15 that itself referenced a previous post on this subject:

Reputational momentum defines the art of the possible of nearly every other goal of the business or organization – sales, profits, retention, recruitment or fund-raising. If your reputation is on the rise, achieving your other goals is so much easier. Conversely, a poorly managed crisis leading to a significant drop in reputation can capsize even the company’s most valiant efforts to achieve its other goals.

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This concept is so unquestionably true that it will become impossible to ignore ... (here again is) a two-phase prediction I first made on this blog back in December: that five years from now the executive position of Chief Reputation Officer will be common in the C-Suites of major corporations in every industry, and that in 10 years, the Chief Reputation Officer will be just as likely as the Chief Financial Officer to step up and succeed a departing Chief Executive Officer. Why should the chief bean counter have a lock on the path to CEO ... when the number of beans to be counted is predicated by the company’s reputational momentum?

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Here's wishing Press all the best. He's blazing a trail that others will surely follow.

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- Jon Harmon