Strategic Management of Communications

The strategic

management of

communications

By Keith Jackson

A Jackson Wells Morris White Paper

Revised July 2006

- -2

Contents

1 – ISSUES: THERE IS A BETTER WAY ..................................................................................... 3

2 – THE COMMUNICATING ORGANISATION ...................................................................... 6

3 – THE VALUE OF EFFECTIVE COMMUNICATIONS ....................................................... 9

4 – CULTURE, PERFORMANCE & COMMUNICATIONS ................................................. 12

5 - COMMUNICATING STRATEGICALLY ........................................................................... 15

6 - COMMUNICATIONS BREAKDOWN ................................................................................ 21

7 - STAKEHOLDERS .................................................................................................................. 25

8 - ISSUES MANAGEMENT ...................................................................................................... 29

9 - APPROACHES TO ISSUES MANAGEMENT ................................................................... 36

10 - The practice of issues management ......................................................................................... 42

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1 – Issues: there is a better way

In January 1985, after two years lecturing in communication at the International

Training Institute, I joined the Australian Broadcasting Corporation as its first

General Manager of Corporate Relations.

The ABC was attempting reform on a massive scale. A new Board

wanted a fresh start, fresh ideas and fresh faces. The old order was

duly expunged and the new management set its course. But good

intentions do not produce change and the Board encountered serious

resistance each time it tried to modify the existing system.

Opposition came from managers whose careers were endangered;

unions whose power base was eroding; employees who wanted

certainty but doubted the ability of management to deliver; a

shrinking audience fighting for its favourite programs – all inflamed by

an excited media.

Through 1984 and 1985, the organisation lurched from crisis to crisis.

Within months of his appointment, managing director Geoffrey

Whitehead remarked that a day did not pass without him

contemplating resignation.

The issues seemed to appear at random. Queenslanders resisting the

axing of a three-minute local TV news bulletin. The union leaking

option papers, purporting them to be policy. Prime Minister Bob

Hawke fulminating on alleged left wing bias in Four Corners. A Senate

inquiry into horse racing broadcasts inspired by an aggrieved ex-race

caller and his mate, Senator Mal Colston. An infamous ‘phantom

army’ of casual employees. The ill-fated National which moved the 7

o’clock news to 6.30, to the disgust of legions of viewers. As the

pressure grew, the ABC Board fragmented into feuding factions -

culminating in walkouts, resignations and the staff-elected director

suing the CEO.

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As the ABC discovered, there is no easy pathway to change; immense

forces of discontent can be released. But issues need not steal the

agenda - no matter how seismic they may be. In the competent,

communicating organisation, they can be managed effectively and, if

renegade, brought under control quickly. 1

There is a better way – and it’s called ‘issues management’.

Issues management involves the planning and deployment of strategy

to control existing or potential issues so they do not jeopardise the

interests of the organisation or its stakeholders.

At the heart of every organisation, present in each nerve and sinew, is

culture: the complex collection of values, norms, attitudes and

behaviours that constitutes the organisation’s personality and

influences much about how it functions, including how it conducts its

relationships. Indeed, issues management is mainly about

relationships.

Using corporate culture as its entry point, this paper explores the

background and the practice of issue management.

Over the last 25 years, governments, corporations and organisations

have placed new emphasis on improving business performance. In the

last 10 years, this has extended to a focus on corporate governance.

These trends have been driven, respectively, by increasing

competition and growing demands for accountability.

Many factors have made the external environment more dynamic:

global business as the new norm, political shifts in favour of individual

rights (and individual enterprise), increasing deregulation, the

burgeoning economies of Asia, a new focus on the customer. In order

to maintain its position, let alone improve it, Australia had to change

its approach to work and to how work was managed.

1 A detailed and accurate chronicle of the events of this period can be found in ‘Whose ABC? The Australian Broadcasting Commission 1983- 2006’ by Ken Inglis Black Inc, August 2006

5

The community experienced similar change. Citizens are better

informed. They are more conscious of their rights. And they are better

equipped than ever to exercise them.

In adjusting to this new order, substantial demands have been made

of managers. People must be managed more creatively. Individual and

collective talent needs to be better recognised and rewarded. Process

has to be subordinated to customer. Efficiency demands synergy and

synergy demands effective relationships, effective communications

and the effective management of issues. This is the world we have

inherited in the 21st Century.

Issues management implies identifying and dealing with problems

either before they occur or before they develop into crises for the

organisation.

It is a mandatory executive skill in a world that demands an

unprecedented degree of professional rigour and competence from its

managers and communicators.

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Failure to anticipate has destructive consequences2

Significant examples of failures to read a changing environment can be

found even in the largest and best resourced organisations. Major US

corporations such as IBM, GM, Sears and CBS, to name just a few, have all

failed to anticipate dramatic external shifts.

For much of the 1980s, IBM ignored signals that the computer

industry was changing. It focused on the mainframe not the PC.

In the late 1960s, GM failed to heed signals of a potential energy

crisis or the increasing attractiveness of small, fuel efficient

Japanese cars until its market share skidded almost 30 percent.

Sears fiddled with self-branded merchandise and monolithic

department store and catalogue delivery systems while customers

demanded name brand merchandise and more quality in products

and services.

CNN pre-empted the networks in the 24-hour news category at a

fraction of the cost CBS was paying for just one hour of nightly news.

2 Cited by William C Ashley and James Morrison, Anticipatory management tools for the 21st century, http://horizon.unc.edu/courses/papers/AntiMgt/

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2 – The communicating organisation

The creation of a communicating organisation – whether it be a government, a

corporation or a small business - involves accepting the principle that managers do

not just deal with the closed system of their own entity but with an open system,

exposed to the dynamics of the external environment and the manoeuvring of

stakeholders.

Stakeholders are more than the organisation’s shareholders,

customers and employees. They include a vast range of other

interested parties who occupy and influence the environment in which

the organisation works, from which it draws resources, to which it

markets and upon which, ultimately, it is dependent.

The creation, building and maintenance of relationships through

effective communications is a keystone for successful organisations.

There are four communications effectiveness factors: relationships,

information flows, information mechanisms and information content.

1. Effective relationships need to be established with those

stakeholders who have an interest (or stake) in the organisation.

TYPICAL STAKEHOLDER GROUPS

Shareholders Electors

Customers Politicians

Employees Community

Suppliers Media

Competitors Public servants

Pensioners Unions

2. Effective, reciprocal and timely information flows. The word

reciprocal is important because it implies that information does not

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move only in one direction. And note the word timely – information

that gets beaten by the grapevine is not going to generate much

that is positive about an organisation for the average stakeholder.

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INFORMATION FLOW FACTORS

UBIQUITY. The extent to which relevant information

penetrates the organisation.

SPEED. The timeliness with which information reaches

its intended destination.

DIRECTION. The capability of information to move in a

reciprocating fashion.

3. Effective information mechanisms. There are literally

thousands of mechanisms, ranging from the humble memo to the

million dollar website. Mechanisms can be categorised according

to whether they are interpersonal (eg meetings), print (eg

newsletters), electronic (eg television) or interactive (eg Internet).

INFORMATION MECHANISM FACTORS

UTILITY. The usefulness and practical capability of the

mechanism to deliver the information people require.

RELIABILITY. The capacity of the mechanism to protect

the integrity of the information it is disseminating.

SUITABILITY. The acceptability of the mechanism to the

intended audience.

4. Effective information content. The mechanisms may be first

class but if content is poorly articulated or impaired, perhaps

because the organisation does not want to disclose, even the best

mechanisms won’t work. In communications, content is King and

the audience is God!

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INFORMATION CONTENT FACTORS

CREDIBILITY. Information is believable and relied upon.

CLARITY. Information is easily understood.

RELEVANCE. Information is meaningful to people in

terms of their lifestyle and work.

SCOPE. Information takes into account the differences

and requirements of specific parts of the organisation.

How much new information is created each year?3

In 2002, about five exabytes of new information was created: 92% of which

was stored magnetically, mostly on hard disks. Five exabytes of information

is equivalent in size to the information contained in 37,000 new libraries the

size of the Library of Congress book collections.

The world population is 6.3 billion, thus almost 800MB of recorded

information is produced per person each year. It would take about 9 metres

of books to store the equivalent of 800MB of information on paper. The US

produces 40% of the world's new stored information and the amount of new

information has doubled in the last three years.

Most radio and TV content is not new information. About 70 million hours of

320 million hours of radio broadcasting is original. TV produces about 31

million hours of original programs of 123 million broadcasting hours.

The average American adult uses the telephone 16 hours a month, listens to

radio 90 hours a month and watches TV 131 hours a month. About 53% of

the US population uses the Internet, averaging 25.5 hours a month at home,

and 74.5 hours a month at work.

3 From University of California (Berkeley) School of Information and Management Systems, How much information: 2003, http://www.sims.berkeley.edu/research/projects/how-much-info-2003/

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3 – The value of effective communications

Within organisations, the communications process performs many functions: it can

disseminate information, share core values, strengthen morale, build value and

contribute to issues and crisis management.

1. Disseminating information. A stock role of communication

process is to ensure that information is distributed within the

organisation and to stakeholders.

2. Sharing core values. The unifying values of an organisation (eg,

teamwork, quality, performance-to-plan) are empty of meaning

unless there is systematic effort to communicate them. Values

depend upon communications for their implementation. Teamwork

is unachievable in the absence of good communications.

3. Building value in the market. Quality information contributes to

creating public trust and confidence. This assumes that promise is

matched by consequent performance. Organisations that over-

promise and under-perform have a credibility gap.

4. Strengthening employee morale. Good communications can

lead to a more positive outlook which can contribute to greater job

satisfaction among employees.

5. Contributing to issues and crisis management. Effective

stakeholder communications is significant in creating relationships

that contribute directly to an organisation’s capabilities at adeptly

handling issues and crises when they arise.

One of the most sweeping changes in organisational communications has

been the growth of teamwork. Boeing’s new 777 jetliner was manufactured

by more than 200 design-build teams. The teams comprised employees from

engineering, quality control, finance and manufacturing. Each concentrated

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on a specific part of the aircraft. Even suppliers and potential customers

were sometimes included in team meetings. 4

4 Wall, 1992, p. 110, http://www.mhhe.com/socscience/speech/commcentral/mgorgcom.html

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BEST PRACTICE GUIDELINES FOR EFFECTIVE ORGANISATIONAL COMMUNICATIONS

1 - The CEO is our chief communicator and is visible, articulate and

proclaims values, vision and strategy.

2 - Managers effectively transform top management’s vision and

goals so they are understood and endorsed by employees.

3 - Managers accept responsibility for good communications and

for improving their own performance as communicators.

4 - Multiple channels - print, electronic, interactive and

interpersonal - are used to reach stakeholders.

5 - Priority is placed on content ahead of means of communication.

6 - Employees are encouraged to engage in communications

through feedback and feed-in.

7 – Employees are involved in the life of the organisation and

managers ensure employees have a good grip on key issues.

8 - Managers recognise that employees have a personal life as well

as a work life.

9 - Communications is strategic: planned, programmed and

integrated with business planning.

10 – The organisation measures and evaluates the way in which it

communicates and uses this data to improve its performance.

In the 1980s, the Australian Graduate School of Management asked senior

executives what they would most like to improve in their organisations. Most

of the executives ranked good communications at the top of their list. A

similar survey in the 1990s provided the same outcome suggesting that,

while managers generally rated communications of high priority, this was

not reflected in actual performance.

Communicating effectively by email5

5 http://www.allbusiness.com/articles/content/15315.asp

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Writing and sending email messages is easy but crafting effective messages

can be a challenge. You need to make sure your message not only says what

you want it to say, but that it conveys the right impression.

An email full of misspelled words or typos can give people the impression

that you're careless, and an angry message sent in haste can jeopardise a

relationship. Knowing email’s limitations can help prevent these disasters.

Grammar. All kinds of rules are broken in email. Don't forget that the

recipient evaluates you based on your message.

Spelling. In business correspondence, you want your words to carry weight,

not to highlight inattention to detail.

Tone. It's much harder to gauge tone in email than in conversation. Your

recipient doesn’t have the benefit of the cues they would have in

conversation. They can't see you wink or hear you laugh, and the ironic

sentiment you mean to convey might be misconstrued.

Emoticons. Although ‘smileys’ or ‘emoticons’ have become hallmarks of

online communication, they're usually inappropriate in business

correspondence. Once you have a solid working relationship, you can judge

whether or not emoticons are appropriate.

Signature. If you use a pre-formatted email signature with your business's

contact information, be sure to type your name at the end of your message

as well. Relying on the signature in lieu of your name can be construed as

cold and impersonal.

Subject headers. Providing an accurate subject header is essential. Many

people choose what to open based on the subject line; blank subject lines or

subjects that have little to do with the message contents are frustrating for

the reader.

Think twice. Always re-read your outgoing messages before you send them

— especially if you're angry. Email makes it easy to fire off a message you

might regret later.

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4 – Culture, performance & communications

Culture is the invisible glue that bonds an organisation. It comprises the collection of

beliefs, values and attitudes that forms the personality of an organisation and

differentiates one organisation from another.

It is culture that dispenses the initial shock you experience upon

joining a new company. Most people quickly adapt to prevailing

culture; some accept it with reluctance; a few remain antagonistic.

The main output a rational organisation seeks for itself is high

performance, which can be measured in a number of ways: e.g., in

terms of productivity, quality, profitability or social utility. Research

suggests the basis of high performance in organisations lies more in

cultural factors than in planning, marketing and skills.

High performance organisations, the argument continues, have a

strong culture: they are unified, outward looking, strategic and

optimistic. Low performance organisations, on the other hand, are

unwilling to examine and test embedded opinions and generally show

no sensitivity of the need to manage culture. They tend to be

fragmented, inward looking, short-term in focus - and low in morale.

Culture & performance

There is a business effectiveness model that seeks to fit a number of

the elements we have been discussing into the one performance

model.

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LEADERSHIP

CULTURE STRUCTURE

PERFORMANCE

STRATEGIC PLAN

Factors influencing organisational performance

The foregoing model assumes that management's primary goal is high

performance and that strategic planning is the starting point with

executive leadership an integrating function. Like all models, it is not

perfect - but there is plausibility and power in the way it draws

together the five elements influencing performance.

Centrally there is leadership. Without good leadership the most

perfectly structured and richly resourced organisation will fail to

perform. Supporting leadership there is:

Structure. How the organisation arranges itself to do

what it has to do. Structure should be a response to market

demand rather than an internal dimension driven by production

considerations.

Resources. The range of human, financial and physical

assets the organisation applies to fulfilling its mission.

Systems. The methods and techniques the organisation

adopts to respond to demand and to deploy resources most

efficiently. Amongst the systems organisations employ are

communications, information technology and quality systems.

Culture. The attributes that make up the character of the

organisation and which distinguish it from other organisations.

Surrounding all this activity and impacting upon it profoundly is the

external environment – the relationships in which the organisation is

enmeshed and which, if it is to survive, it must manage.

The central task of management is to design and direct each of these

interdependent factors so they work together as effectively as

possible.

Let us consider a simple example.

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SYSTEMSRESOURCES

It is obvious that a change in structure – e.g., the Administrative unit

taking over the Finance function - will affect the way resources and

systems are deployed in an organisation. The change may also result

in a culture shift especially if the demise of Finance as a separate

unit removes a well-established and tradition-bound entity from the

organisation. The organisation’s leadership will of course be the

integrating influence in all this activity.

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KEY CONSIDERATIONS IN PLANNING CHANGE

A change in one performance factor inevitably induces

changes in them all.

The relationship between each factor must be defined,

planned and communicated if the organisation is to

achieve high performance.

Communication implications

If you change structure without adequately informing employees of

the reasons and the implications, it is likely morale and even

industrial problems will ensue. If there are resource constraints

necessitating a change in strategic direction and managers are

neither consulted nor persuaded of the merits of the new strategy

there are likely to be implementation difficulties. If operational

systems are changed without users being fully briefed there are

bound to be significant downstream problems.

The Erebus tragedy: death by culture6

The Air New Zealand aircraft that crashed into Mt Erebus in Antarctica

underscores the notion that organisational cultural and communications

patterns influenced the actions of its pilots who unwittingly flew directly into

the mountain at 1500 feet. To make sightseeing more exciting, upper

management changed the route from circling the mountain to flying over it

prior to a low altitude circumnavigation. The aircraft’s flight management

systems were reprogrammed by avionics personnel, but no one told the

crew. Flight briefers advised new altitudes but not in the context of new

6 Catherine A Adams, Organizational Culture and Safety, 2003, http://techreports.larc.nasa.gov/ltrs/PDF/2003/mtg/NASA-2003-12isap-caa.pdf

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routing. The pilots assumed the altitudes were guidelines rather than

requirements. Disaster ensued.

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5 - Communicating strategically

Communications & strategy

We can't assume that the future of any organisation is likely to be a continuation of

the past. An increasingly competitive world means that past assumptions about

appropriate policies, strategies, products and markets are no longer very useful.

In Australia modern and traditional organisations exist side by side,

often within the same corporate walls. This is true whether we are

discussing the public, private or not-for-profit sector. The key

differences between traditional and modern organisations are

summed up in this comparative table.

CHARACTERISTIC TRADITIONAL MODERN

World view Economic Political-economic

Focus Internal (micro) External (macro)

Concerns Static (size, structure) Dynamic (adjustment to external influences, competition)

Management Concerned with control, coordination, process, resolving work-related conflict

Concerned with strategic decisions, issues management, external challenges

Definition of effectiveness

A technical matter based on objective standards

A political matter established through bargaining with constituencies

Limits to the organisation

Set mainly by its own capabilities

Set mainly by environmental constraints

Organisation’s impact on society

Limited. Judged in terms of output of products and services

Multiple. Subject to public scrutiny and bargaining by stakeholders

Traditional and modern organisations

If we are to avoid becoming victims of the future we must develop

some understanding of what it may hold. Communications methods

and techniques offer a way of influencing the shape of future issues

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and events. They make it possible to influence the future by narrowing

its range of uncertainty.

In this context, issues management is in no way an adornment but an

integral part of management planning, decision-making and

controlling.

Strategic communications can be defined as the organised and

systematic application of communications methods, materials and

techniques to support management in its pursuit of the organisational

mission and goals.

COMPONENTS OF STRATEGIC COMMUNICATIONS

Understanding the organisation, its culture and its

external environment.

Creating a network of effective relationships.

Ensuring the free flow of reliable information.

Identifying and managing internal and external issues.

Factoring in communications considerations at the

planning stage of corporate activity.

Designing and executing communications programs

which blend with management strategies.

Committing management to thoughtful intervention to

bridge gaps between intent and performance.

Corporate communications & public relations

The main facilitator of formal communications in most organisations is

the public relations department. This function may sail under many

different flags - public relations, corporate relations, corporate affairs,

public affairs, public policy, external affairs or group communications.

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In each case the basic task is the same: to support the development

and maintenance of effective lines of communication with groups

inside and outside the organisation. The qualifiers "facilitate" and

"support" infer that communications is not a unique task assigned to a

particular professional group but the responsibility of every manager

and supervisor.

The PR function may focus on any of the external and internal

relationships critical to the organisation: media relations, community

relations, government relations, customer relations, investor relations,

employee relations and so on. In addition, it may be given

responsibility for marketing, corporate image, publicity, promotions,

advocacy advertising, publications, displays and exhibitions, and

special events.

Even relatively small organisations have their own public relations

personnel and in large organisations there is commonly a flotilla of

‘flacks’ or ‘spin doctors’, as journalists somewhat unkindly call them.

Like in every other profession in a changing world, under the weight

of management expectations the nature and characteristics of public

relations are changing. This comparative table looks at what may be

termed the ‘old’ and the ‘new’ PR:

CHARACTERISTIC OLD NEW

World view Economic Economic-political

Prime concern Marketing Strategy

Focus Products Stakeholders

Performance indicator Quantity Quality

Priority Image Performance

Positioning Below the line Above the line

Impacts Limited Multiple

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Thrust Supportive Synergistic

Mood Manipulative Analytic

Timeframe Short term Medium term

Challenge Credibility Acceptance

The old and the new PR

PR runs into major problems when it is used to build facades over

chronic problems. Stakeholders see such tactics as dubious - and they

are dubious. The bottom line is always performance. Image is never a

substitute for substance.

There used to be a school of thought, still prevalent in some circles,

that any publicity is good publicity. Australian business history attests

to the thin ice on which this premise rests – the stories of John Elliott,

Brad Cooper, Rodney Adler, Ray Williams, Rene Rivkin, Christopher

Skase and Alan Bond being obvious examples.

In the short term, PR glitter may beguile and even persuade.

Ultimately, however, because PR’s substance can be no better than

the product, company or idea it is trying to promote, it will not

endure.

Ill considered attempts to create ‘good news’ stories, or to suppress

bad news or to crash through with bluff and bluster can come

seriously adrift.

Some supermarkets saw ‘green friendly’, photo-degradable shopping bags

as a great marketing initiative. But doubts were soon cast on the

environmental soundness of the process by which the bags were

manufactured.

Then, when a daily newspaper encouraged people to peg bags to

clotheslines and report on how long they took to disintegrate, it was the

beginning of the end. Ugly grey bags flapped in the breeze month after

month. We no longer see many photo-degradable shopping bags.

Corporate communications as a tool of strategic management has the

capacity to enhance business opportunities, protect the organisation,

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assist with the implementation of corporate plans, provide an input to

strategic decisions and promote a continuing awareness of the total

context in which the organisation is operating.

Case studies

Bountiful banker brings borrowers to brink

A bank manager in a far-western wheat and sheep area has been lending in

an irresponsible way. Ladling out credit, his speciality is negotiating loans in

local pubs and clubs, assuring credulous farmers of a golden opportunity to

improve property and machinery. The banker single-handedly inflates

property prices in the district. Then, when interest rates soar, the bank starts

foreclosing.

(1) You're the PR manager. Upon learning the 7.30 Report is

working on this story, what do you do? (2) What are the pros

and cons of the options you face? (3) When the reporter calls

asking for an interview, do you say yes or no? (4) What are the

pros and cons of either course? (5) How do you explain forty

foreclosures in this small district to: (a) the 7.30 Report, (b) the

local community, (c) your local employees who are taking a lot

of flak?

Dubious deals dishonour despatch

A new management team is appointed to run a public sector rail

organisation. The CEO comes from interstate and immediately faces

resentment about his appointment and public controversy over a leaked staff

reduction plan.

In his first month on the job, shocked by a long history of theft from the

despatch department, he authorises a late night raid of a warehouse and is

lucky enough to catch the culprits red handed. They are insiders. The CEO

suspends them without pay and calls in the police. The police tell him it was

known all around town that new generators, machine tools and other

equipment could be ordered from the nearest pub and delivered at a fraction

of the market price.

(1) Should the CEO keep the wraps on this one or should he

disclose? (2) What are the pros and cons of either course? (3) If

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he does disclose, to whom: (a) Minister, (b) unions, (c)

employees, (d) customers, (e) media? (4) And what should he

say?

Perplexing prattle peeves personage

A major construction company is under siege. It has diminishing contracts,

buoyant bad debts, a drooping share price, disgruntled contractors and poor

employee morale.

And now it has another problem. Sensitive documents are being leaked to

the media in a steady flow. The managing director decides something must

be done: so an instruction on how to protect and safeguard documents is

issued. Soon after, the instruction about preventing leaks is itself leaked.

The MD decides he had to go further. So he forms a committee to consider,

and remedy, the problem.

(1) Suppose the committee chairman asks you how you see the

problem. What do you say? (2) What steps would you propose

for minimising the leaks - or preventing them altogether? (3) In

what terms would you communicate these steps to: (a) top

management, (b) employees, (c) customers who have voiced

concerns that documents embarrassing to them might surface in

the Sydney Morning Herald?

Lessons in communicating uncertainty7

Use redundancy and repetition to communicate core messages over an

extended time period. Redundancy communicates a similar message in

different ways, like a stop sign using language, shape and colour to send the

same message. Repetition increases the odds that everyone will at least hear

the core messages.

Allow the core messages to evolve over time. Changing circumstances will

demand messages that develop. But such development must not include

contradictory messages.

Utilise employees at all levels to communicate messages. Managers often

make the mistake of assuming sole responsibility for communicating. Both

managers and employees need to be an integral part of the process.

7 Phillip G Clampitt, Bob DeKoch & Tom Cashman, Communicating strategically: a perspective and case study about creating comfort with uncertainty, 2001, http://www.imetacomm.com/otherpubs/pdf_doc_downloads/strat_commg_uncertainty_v4.pdf

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Anticipate and respond to employee resistance points. Messages may

generate employee discomfort and resistance. Skilful managers do not

minimise employee concerns, they acknowledge, legitimise, and objectify

them.

Frequently discuss the organisation’s future. While reassurance about job

security is necessary, the future is the predominant issue. Employees want

to know about future products, marketing plans, new customers and

research efforts.

Use messages to frame auxiliary issues. To frame a subject is to choose one

meaning over another. The frame acts as a lens through which other issues

are viewed, highlighting certain images and refracting others.

Align communications tools with the messages. In most organisations there

is a strong temptation to use the same communications tools regardless of

the messages. In a situation of change, traditional tools may subtly

undermine messages.

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6 - Communications breakdown

Here are some common reasons why communications fails.

Bias

Perceptual bias by the receiver can mean people hear only what they

expect or want to hear and filter out unexpected or unwelcome

information.

Federal Opposition leader, the late Billy Mackie Snedden said he hadn't lost

the 1974 election, he just hadn't got enough votes to win.

In the organisational context, it can take the form of selective

perception.

A British study cites the case of a production manager who recorded himself

giving instructions on 165 occasions. His subordinates recorded receiving

only 84 instructions. Conclusion: Nearly half the time the manager thought

he was communicating, employees didn't get the message.

Conflict

Where there is interpersonal or interdepartmental rivalry, information

is often withheld or distorted.

In IBM, internal rivalry over quality became so intense that divisions were not

disclosing crucial information to each other. This had a major impact on

performance and IBM ended up scrapping the approach.

Distrust

A study of 330 United States scientists found that, where trust was

weak, communications was evasive or aggressive. This can be seen in

organisations where managers evade their responsibility to fully

disclose and employees search for the hidden agenda.

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Distance

The old sage said it first, "out of sight, out of mind". The greater the

distance, the less one communicates. People in branch offices often

feel they are not kept adequately informed.

Distortion

Information is omitted or recast by the sender. It may be deliberate.

US research showed individuals with career ambitions systematically

withholding information that might threaten or detract from their

position. Or it may simply be the well-known weakening and

misconstruing of information as it passes along a chain.

A study of 100 US companies showed that, of information disseminated by

the CEO, the first level down recalled getting 65%, the third level 40% and the

fifth level 20%.

Immediacy

More immediate communication tends to drive out less immediate

(the tyranny of the telephone).

A Columbia University survey revealed that, while half the major points made

in a lecture were retained at the end of the lecture, this figure dropped to a

quarter after two weeks.

This was most likely due to a combination of overload and failure to

understand or reinforce the key points. A critical factor in effective

communications is the need for consistent repetition of the same

message over a lengthy period of time.

Obfuscation

This is caused by a variety of factors including inadequate

explanation, jargon, imprecision, ill-defined objectives and so on.

A lecturer at the International Training Institute asked a group of African

trainees to wait for him outside a department store in Sydney's central

business district. When the lecturer returned, he found the group had moved

29

some distance up the street. Questioned on the reason for this, one trainee

pointed to a nearby road sign which said ‘No Standing’.

Obliteration

We know that non-verbal communication (facial expression, gesture,

tone of voice, dress, etc) has four times the impact of verbal

communication and can result in its obliteration. This is especially so

on TV where the images can sink the words.

Overload

Information overload (a term coined by Alvin Toffler in his 1970 book

Future Shock) refers to having more information available than can be

readily assimilated. It can lead to confusion and incomprehension.

Status

Status differentials pose problems for communication. Individuals of

lower status find it difficult to initiate communication with higher

status people (and with groups). This places an obligation on

managers to establish an appropriate climate for effective

communication.

US research showed that:

90% of managers said they understood supervisors' problems but only

51% of supervisors said managers understood their problems

95% of supervisors said they understood their workers' problems but

only 35% of workers said supervisors understood their problems

Reality and perception

A survey in the United States has found that the overwhelming

majority of chief executives believe public perception is as important

as performance in determining corporate success. It's not just what

you do that matters; it's what people think you do. It's not just what

you are that matters; it's what people think you are.

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Problems flowing from perception are more intractable than most.

More often than we’d like to believe, perception is more influential

than reality. Long after the actual performance of an organisation has

improved, the perception that things are bad can continue to pose

problems. When perception combines with stereotyping, it is very

difficult to shift the image of an organisation.

Here are some solid as rock stereotypes: public servants are

inefficient; banks are ripping us off; you can’t trust a political promise;

engineers are unimaginative; accountants are dull.

Having recognised there are two factors at work in defining an

organisation's reputation, the point is not complicated. Perception and

reality both influence where you place your emphasis when

communicating and how you communicate.

When image (perception) is badly tarnished, there is only one sure

way to resurrect it: the organisation must improve performance

(reality) then communicate the new reality. It is at this point that we

move more deeply into the substance of issue management.

A note on the grapevine

In the participatory organisation, information moves more freely. In

the bureaucratic organisation, information flows are impeded and, as

a result, informal channels (the grapevine) tend to become the main

means of information dissemination.

It is commonly claimed that the grapevine (aka rumour mill, bush

telegraph, coconut wireless) is reliable. Unfortunately this is rarely

the case. For the most part, the grapevine is an unreliable means of

distributing and acquiring information.

Grapevines carry without discrimination fiction, fantasy, speculation,

exaggeration, interpretation, misconstrued analysis and, yes,

sometimes even the truth. But you never know for sure what you're

getting. Grapevines are open to abuse, they yearn for mischief and

should never be regarded as credible.

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The expression grapevine telegraph was invented in the USA sometime in

the late 1840s or early 1850s. It provided a wry comparison between the

twisted stems of the grapevine and the straight lines of the then new electric

telegraph marching across America. The term became widely known during

the American Civil War period, so much so that the phrase permanently

entered the standard language. Soldiers used it in the sense of gossip or

unreliable rumour.8

8 Taken from Michael Quinion’s ‘World Wide Word’, http://www.quinion.com/words/qa/qa-gra2.htm

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7 - Stakeholders

The notion of stakeholder is one of the underpinning ideas of issue management. A

stakeholder is any group with a direct or indirect interest in the organisation. It is

any group that influences how the organisation achieves its objectives.

Companies wishing to improve the bottom line or under financial duress

frequently cut staff. Not an uncommon issue and clearly one with a large

impact on a number of key stakeholders.

Of central importance are employees and unions, the latter wielding influence

in their own right. The government, especially a Labor government, may also

emerge as a key player. So too the Industrial Relations Commission where any

disputes may unfold.

Customers clearly have an interest, especially if there is a prospect of

industrial action, and there is always clear media interest.

Two other stakeholders with a keen interest in how things turn out will be

shareholders (usually keen to bid up the price of a stock when employees are

shown the door) and competing organisations.

Stakeholders must be identified, communicated with, listened to,

understood and - ultimately - accommodated. We are talking here

about establishing and maintaining relationships, the central element

of effective communications and effective issues management.

THRESHHOLD RULES TO MAINTAIN RELATIONSHIPS

· Talk with stakeholders and ensure they’re listening.

· Talk in terms stakeholders are able to understand.

· Make sure stakeholders talk back to you.

· Listen to them and understand what they are saying.

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Maintaining good stakeholder relationships, however, goes beyond

this elementary two-way transaction of information. There is a high

level of interaction and inter-reliance between a large number of

stakeholders and relationships are, in reality, much more complex.

The organisation does not even need to be part of the argument to be

dragged into it by stakeholders.

In the Illawarra region of New South Wales, the local Trades and Labour

Council opposed the closure of the casualty facility at Port Kembla hospital.

When the State Health Minister ignored them, the TLC threatened a strike

against the steelworks - an innocent bystander.

Faced with losing $10 million a day in lost revenue from a shutdown, the

steelworks intervened to keep the facility open until eventually the Health

Minister changed his mind.

A clear analogy we can make is that of the solar system. If the

organisation is Planet Earth, locked into its own orbit and hurtling

through space, then stakeholders appear as sister planets - travelling

their own paths but exercising considerable gravitational pull on each

other and on the Earth.

To take the analogy a step further, the whole system is moving and

interacting with other systems within the galaxy. The total

environment in which we find ourselves is dynamic and constantly

changing.

KEY FEATURES OF STAKEHOLDERS

· They influence greatly the climate in which the

organisation operates.

· They can intervene on matters in which they have an

interest.

· Their influence on the organisation can be as strong as,

and rival, managers own more direct control.

· They can collaborate to get their way.

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The Australian ‘bank bashing’ phenomenon showed how customers,

consumers, unionists and politicians can collaborate in a loose and

informal alliance with the media to make life difficult for the major

retail banks. This was no conspiracy - simply stakeholders behaving

interactively in pursuit of their own interests.

To the extent that this interaction between stakeholders affects the

organisation, there is a need to pre-empt or intervene. This was seen

clearly in some of the events which led to the downfall of Australian

entrepreneur Alan Bond.

Tiny Rowland, a onetime business ally of Alan Bond, was so angered by

Bond's share raid on Rowland's Lonrho organisation that he launched a

concerted public relations-based attack on the financial soundness of Bond

Corp.

The subsequent critical media reporting of Bond's affairs undermined

investor confidence and created enormous problems for the entrepreneur.

The Bond Corp share price and credit rating dropped, the market took flight

and bankers got jittery.

Bond Corp's subsequent demise would probably have happened without

Tiny Rowland but it unlikely that it would have occurred with such speed.

Stakeholder groups

Stakeholders represent the basic building block of strategic

communications but, in reality, it is impossible to communicate

effectively with them in their macro formations of government, media,

business, community etc. These groups are simply too big to relate to

and they are too diverse to allow the fashioning of relevant and

focused messages.

Upon examination, it is seen that each stakeholder group contains

within it many sub-groups. These more specific formations become the

focal point of communications.

EXAMPLES OF MEDIA SUB-GROUPS

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· Television · Metropolitan dailies

· Radio · Suburban press

· Provincial press · Magazines

· Trade press · Professional journals

Once the sub-groups are defined as in the foregoing example, the next

consideration concerns which specific media within the sub-groups to

communicate with. Media choice depends very much upon the

stakeholder’s distance from us and position in relation to us, the

message generators.

If the target audience is distant and dispersed, we deploy the mass

media (radio, TV, press) or interactive media (Internet). If the

audience is closer and less dispersed, the electronic and print media

choices tend to be lower tech and cheaper (telephone, memo). If the

audience is very close, the options are again different as interpersonal

communication comes into play.

It is worth reinforcing that we first identify the stakeholder, then

define the sub-groups and then select the media to reach them. The

stakeholder always comes first; the media choice second. We don't

ask questions like: "Who will we send the newsletter to?" Instead, the

question becomes: "Which mechanism will best reach our supervisory

staff?"

There is a hierarchy of targets for mass media messages. The message

is designed for the primary target, but there are also subsidiary

targets. Say, for example, you circulate a memo on a planned

restructuring for which the primary target is staff. An important

secondary target is the union, so the memo will clearly need to be

designed to avoid plunging you into an industrial dispute. A tertiary

target for the memo might be the media, given that it could be leaked.

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Stakeholders complicate Internet’s future9

The architecture of the Internet has always been driven by a core group of

designers but the form of that group has changed as the number of

interested parties has grown.

With the success of the Internet has come a proliferation of stakeholders -

stakeholders now with an economic as well as an intellectual investment in

the network.

We now see, in the debates over control of the domain name space and the

form of the next generation IP addresses, a struggle to find the next social

structure that will guide the Internet in the future.

The form of that structure will be harder to find, given the large number of

concerned stakeholders.

9 Barry Leiner, A Brief History of the Internet, Vinton Cerf, David Clark, et al, 1998

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8 - Issues management

Issues management is about caring where you end up. And, therefore, it is about

caring which way you go. This requires understanding of the external environment,

effective analysis, reliable forecasting and the competency to realise plans.

"Cheshire Puss" Alice began, "would you

please tell me which way I ought to go

from here?"

"That depends on where you want to get

to," said the cat.

"I don't much care where," said Alice.

"Then it doesn't matter which way you

go," said the cat.

- Lewis Carroll, ‘Alice in Wonderland’

The Cheshire cat might have been a philosopher - but it was no

strategist. Otherwise the fat feline might have pointed out that it

mattered a great deal where Alice went and that, maybe, she should

stop and think about the question some more.

Nicolo Machiavelli, the arch strategist who flourished 500 years ago,

understood this when he wrote:

"For knowing afar off the evils that are brewing, they are

easily cured. But when they are allowed to grow until

everyone can recognise them, there is no longer any

remedy to be found."

The advice is as relevant today as it was in Machiavelli's time. Pick the

issue early, we are advised, and do something about it. Undue delay

may lead to failure.

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What is an issue?

In the context of this paper, an issue is any event impacting on

- or which may potentially impact on - the performance of an

organisation.

There is an abundant supply of issues. They may involve economics,

environment, health, engineering, international trade, parent-teacher

relations, crime, property, politics or any other dimension of human

activity. Every organisation faces scores of issues, which unhappily

often manifest themselves as win-lose situations.

In the 1993 Federal election, each of the two major political parties was

confronted with the need to manage a volatile issue.

The governing Australian Labor Party had to manage the issue of double-

digit unemployment. The Liberal National Party coalition went into the

campaign burdened with an unpopular goods and services tax.

The poll outcome essentially revolved around which party could minimise its

own killer issue while playing up the others.

Labor managed the unemployment issue by injecting the goods and services

tax with a monster virus. The GST stalked the coalition all the way to polling

day, when it lost a close election.

When consulting to Westpac a few years ago, I sought senior

managers’ assessment of key issues in surveys conducted two years

apart. As you can see, the issues in consideration varied considerably

over that time.

CHANGING PERCEPTIONS OF KEY ISSUES

ISSUE 1989 1991

Service quality 55% 40%

Overseas expansion 33% n/a

Organisational culture 30% 30%

Consumerism 27% n/a

Profitability 24% 20%

Growth 24% 10%

Image 21% 60%

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Product awareness 15% 10%

Technological change 15% n/a

Leadership 12% 40%

Government regulation 12% n/a

Quality of investments n/a 40%

Morale/self image n/a 30%

What is issue management?

Issue management is an action-oriented management function that

seeks to identify actual, emerging or potential issues that may impact

on the organisation and to mobilise and coordinate organisational

resources to influence their development.

COMPONENTS OF ISSUE MANAGEMENT

· Identification, analysis and prioritisation of actual,

emerging and potential issues.

· Mobilisation and coordination of resources to deal with

them.

· Active and strategic influence of their development.

What is so crucial about adopting a strategic approach to managing

issues? Can we not deal with them simply by handling problems as

they come along?

Perhaps the best answer to this rests in a consideration of what can

happen when there is no effective issues management. Take a look at

today's newspapers. Many of the stories are the result of issues that

have not been managed effectively. The issues that were managed

properly probably didn’t make the headlines.

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Every organisation constantly confronts and needs to manage a range

of issues.

The liquor industry positions itself as a good corporate citizen. It volunteers

to uphold advertising codes, takes a stand on underage drinking, supports

government campaigns on drink driving, and focuses on moderation in

alcohol use. Result: by acknowledging and dealing with the issues, the

industry manages its way through.

In the absence of effective communications, many issues will either

not be resolved or perceptions that they have not been remedied will

linger on long after the reality has changed.

Unmanaged issues, whether external or internal, can make life very

difficult for an organisation. They can, amongst other things:

generate controversy which may destabilise the

organisation

create a hostile climate of opinion which may detract from

its image

deflect from planned and rational action as interest groups

exert pressure

cause managers to lose focus and impact adversely on

employee morale

Organisations (and individuals) that do not manage issues are

jeopardising control of their own destiny. Planned action gives way to

ad hoc reaction. Issues management becomes crisis management.

Unresolved issues distract organisations from the main game. They

waste time and they waste energy. If not confronted and managed,

issues persist. They rarely go away of their own volition.

When he became managing director of Westpac, Frank Conroy was

determined to revive the bank’s flagging fortunes. Part of his armoury was

an upbeat advertising and public relations campaign. A few months into his

new appointment, Conroy said Westpac had turned the corner on its

financial problems and that the bad news was over. Soon after, the bank

announced a record loss. Further reassurances were given. But it seemed

each time it was claimed the worst was over there was another crisis: a

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share float that sank, a huge overseas tax liability, unexpected property

writedowns and bloodletting on the board.

The constant attempt to talk things up made matters worse, especially

as it was perceived there other issues the bank was not addressing.

PERCEIVED UNADDRESSED ISSUES

• Damaged credibility particularly with customers and

investors.

• Media cynicism at the bank's evasion and arrogance.

• Diminished customer service which kept stories of the

bank's errors in the public domain.

Being stalked by the issues is not good management. Yet

organisations frequently allow themselves to be trapped by issues

rather than getting on the front foot and managing them.

Issue management is about facing up to the unpalatable, picking the

issues early, building the networks which will deliver information and

influence, understanding exactly where the opposition is coming from

and doing something about it early enough to make a difference.

Issue management requires an ability to see other people's points of

view and to understand the difference between emotional and

intellectual debate. It is also a point of convergence between business

management and business communications. It reflects the reality that

organisational issues may have a public, political or industrial

dimension that may determine the course of events just as much as

any decision made by management.

Once an organisation is negatively perceived it may be able to

extricate itself only with great difficulty. It's clearly best to avoid

getting into this position in the first place.

Sydney’s monorail only ever had one birthday party and it was an

anniversary that should have been allowed to pass unheralded. Just as

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people were beginning to forget the controversy surrounding construction

(environmental outrage, heritage arguments, oil leakage scares, nuns

trapped aloft for hours on one of its first trips), the monorail operators

decided to celebrate its first year of operation.

It was a debacle. At the commemorative news conference a toy monorail

lurched around a model railway and broke down for the cameras. TV viewers

later witnessed the spectacle of the general manager instructing journalists

"not to film that". The real life monorail carrying the media came to a

grinding halt halfway around its circuit. The celebration provided a gold-

leafed invitation for Citizens Against the Monorail to renew their campaign.

And the ABC chipped in with an investigative piece claiming that the

monorail was losing $20,000 a week. It was quite a marketing exercise.

Issues management involves taking a planned and analytic approach -

not ‘gut feel’, not emotional, not subjective, not random, not short

term. When you fix the problem, you want it to stay fixed. In the

absence of effective communications, many issues will either not be

resolved or perceptions that they have not been fixed will linger on

long after the reality has changed.

Issues management is not a synonym for the so-called ‘public relations

fix’. There is, in reality, no such thing as a ‘PR fix’. Not in the medium

to long term, anyway. The best PR can do without substantive backing

is to offer a temporary repair which will split open next time there is a

bit of pressure. There is no such thing as an advertising fix either.

There is only a management fix.

Early in 1988, in one of the greatest misbegotten ideas in the State's history,

then NSW Minister for Natural Resources Janice Crosio plunged into the

Bondi surf in a public relations stunt designed to show that the water at

Sydney's finest ocean beach was clean. As the truth about Sydney's beach

pollution unravelled over succeeding months, the community realised that

Sydney's beaches needed more than PR treatment.

Issues management is not crisis management, although the two are

frequently confused. In fact, issues management is the antithesis of

crisis management. It involves an effort to fix problems before they

occur, or at least to minimise their impact. It involves picking the

43

issues early enough to do something about them before the crisis

descends.

A sound issues management approach constantly scans and analyses

internal and external environments, seeking telltale signs of emergent

difficulty and planning the management of worst case situations.

Crisis management is the practice of dealing effectively with issues

that have well and truly gone off the rails.

How issues are generated

At the point when an organisation translates intent into action, or

when it broadcasts a decision, its intent becomes tangible. A range of

groups may be impacted by the decision and they will react depending

upon how they perceive their interests are affected. In human terms,

an issue is generated when your intent and a dissonant interest

collide. Each day, there are many such moments in the life of an

organisation.

Most issues are minor enough to be dealt with as they arise, or they

can be accommodated within the normal planning and operational

framework of a strategic organisation. But, where an organisation is

not strategic or where the issue is not discerned or is more volatile

than anticipated, the collision can be devastating.

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GOAL

Deflection pathZONE OF REACTION

ISSUE EMERGESZONE OF PRE-EMPTION

Intervention path

Planned change pathSTAKEHOLDERS

DECISION / ACTION

How an issue emerges

When an organisation makes a planning decision it sets out on the

desired change path leading from the decision to the achievement of

a defined goal. When the decision is implemented, subsequent action

is evaluated by those stakeholders who believe their interests may

be affected or who believe they may be able to influence the decision

in their own interest.

If a stakeholder assesses it is likely to be affected adversely, or

believes it may be able to leverage its position in some way, it will

react. It is in this initial exchange of initiation and eraction that an

issue is generated.

Depending upon the nature and extent of the reaction, the stakeholder

may intervene in the change path envisaged by the organisation. A

significant intervention can deflect the organisation from its planned

pathway. This deflection can effectively undermine the attainment of

the defined goal.

The practical application of this model, however, lies in understanding

that it has two zones. Most organisations wait until an issue has been

generated before taking any action. They operate in the zone of

reaction, and are price takers in issues management terms.

Other organisations try to move to the zone of pre-emption, and are

price makers in issues management terms. This means they plan all

decisions of consequence in terms of how stakeholders will react and

assessing how such reaction may impact on the change path. If the

assessment is that deflection may occur, the organisation will act pre-

emptively to ensure the issue either does not arise or, if it does, that it

can be managed effectively.

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9 - Approaches to issues management

Zone of reaction

No less than three separate categories of response are identifiable in

the zone of reaction: passive, defensive and reactive.

The passive approach supposes the issue will go away if it is

ignored. It won't. It will probably get worse.

When random breath testing was proposed for the state of New South Wales,

the two major breweries chose not to enter the debate. The result was the

imposition of a .05% blood alcohol limit. In South Australia, where local

breweries became actively involved in the debate, a higher limit of .08 was

set.

KEY POINTS OF THE PASSIVE APPROACH

INDICATORS

· The issue may be identified or it may not be.

· There is an assumption that it will go away eventually.

· There is no productive action to manage the issue.

OUTCOMES

· There is an abdication of management responsibility to

act and influence.

· The issues frequently generate major failure or crisis.

A defensive approach is not much better than passivity. Here, the

organisation identifies the issue, sits on it until it is raised publicly and

then grimly tries to defend itself. This not only relinquishes control of

the agenda but the defence is often weak and unconvincing.

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The former Sydney Water Board's initial response to public outrage about

polluted beaches was to say that everything was under control. Public

opinion refused to accept that position and eventually there was politicial

intervention.

Sometimes, when an issue looms, it is possible to temporarily hold

back the tide. But the process is usually inelegant and a source of

embarrassment.

Sydney's major newspapers and most newsagents have a cosy arrangement

where newsagents agree to home deliver (an unprofitable activity) in

exchange for the granting of exclusive rights to sell in certain areas. This

restraint of trade has effectively prevented deregulation of the industry and

was investigated by the Australian Competition and Consumer Commission.

The ACCC ran into successful resistance from newspaper groups and

newsagents' associations, a crude defensive fix to keep out potential

competitors.

KEY POINTS OF THE DEFENSIVE APPROACH

INDICATORS

· The issue is usually identified.

· It's rarely analysed or prioritised.

· It may be discussed but there is no action.

OUTCOMES

· Control of the agenda is relinquished.

· Defensive explanations convey weakness and lack of

conviction.

By far the most common means of dealing with issues is to adopt a

reactive approach. Once again, the issue is often spotted in advance

but either the organisation has no appropriate means of dealing with

it or there is an inclination to lock it out of sight and hope it will go

away.

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Finally the issue starts running and the organisation is driven from

the closet to deal with it. But control of the agenda has been

relinquished to others and it is difficult to regain the initiative.

Nevertheless, this is how most issues are handled. It's like giving Phar

Lap three lengths start. It also means making decisions on the run,

often without adequate information or research and with the

prospects of success diminished by having to build substance and

credibility out of controversy and pressure.

The Multifunction Polis seemed like a good idea at the time but the media

soon made great capital with the notion of 'Japanese enclaves' and

bureaucratic confusion surrounding exactly how the polis would work.

A consultancy was paid a million dollars to design a model that nobody

liked. Corporations funding the project suspected rivals were trying to seize

a competitive advantage. The Commonwealth Government thought it should

be in charge. State Governments thought they should.

It was decided to give the MFP to Queensland but the Queensland

Government didn't own the proffered land. The Japanese wanted Sydney but

ended up with a swamp full of noxious chemicals outside Adelaide. In 1999,

after ten years of dashed hopes, the MFP was laid to rest.

The MFP people later said they decided not to communicate what they

were doing because people might misunderstand and that this would

create problems for them!

KEY POINTS OF THE REACTIVE APPROACH

INDICATORS

· The issue is usually identified.

· It is frequently subject to some analysis.

· A reactive plan is often formulated but no pre-emptive

action is taken.

OUTCOMES

· Control of the agenda is relinquished.

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· Reactive management is often successful but damage

has been done where it might have been avoided.

Zone of pre-emption

Finally, there is the best idea of all - the pre-emptive approach. An

organisation is pre-emptive where - having identified the issue - it

tries to do something about it before it causes problems.

SOME PRE-EMPTIVE MANAGEMENT ACTIONS

· Prior consultation with constituencies to achieve an

acceptable decision.

· Gathering good intelligence about constituency

positions.

· Varying decisions to accommodate constituency views.

· Explaining decisions fully and carefully.

By emphasising pre-emption rather than reaction, managers provide a

safeguard for the organisation: a distant early warning system.

Further, managers ensure that stakeholders benefit from problems

being solved before they get out of hand.

KEY POINTS OF THE PRE-EMPTIVE APPROACH

INDICATORS

· The issue is identified, analysed and prioritised.

· A strategic plan is formulated.

· Pre-emptive action is taken to manage the issue.

OUTCOMES

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· The issue is managed effectively.

· It may never actually impact on the organisation.

· A win-win situation for the organisation and its

stakeholders.

There are very few beneficiaries from an issue gone bad - which is

pretty much a lose-lose situation.

It is often difficult to see pre-emptive issues management at work.

Often, the issue simply never surfaces - it has been fixed first. The

victors rarely boast (Messrs Tuckey and Moore who engineered John

Howard's first downfall as Federal Opposition leader were

exceptions). Occasionally, though, you can spot the telltale signs.

In many cases of pre-emptive issues management, a particular

initiative or "game breaker" can be identified, which provides the key

to the resolution of the issue.

Such was the case when Telecom (now Telstra) outmanoeuvred its business

opponents, the Economics Ministers, the Department of Transport and

Communications, the then Overseas Telecommunications Commission, the

Trade Practices Commission, the media and just about everybody else in

securing the position it wanted in the new telecommunications order. There

were two key lessons in what Telecom did. Firstly, it got on the front foot

with a politically viable and intellectually robust position. And then it

committed itself to the hard work of lobbying.

Telecom's pre-emption flowed from recognising that it would have to

give away something substantial - its monopoly - in order to secure

the position it wanted in the new order.

When Kentucky Fried Chicken changed its name to KFC, it decided to place

the name change in the context of a range of other planned initiatives: plans

to double in size over five years, build 250 new restaurants and employ 7,000

more people. It was an impressive investment in the middle of a recession -

including the name change as just one issue among many.

KFC's pre-emption was based on an understanding that a name

change was not all there was to the game. By placing the name

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change in the broader context, it was seen correctly as but one

change among a raft of changes.

Taking a pre-emptive approach allows you to plan your way through

issues and to strongly influence, and even determine, their outcome.

Mary MacKillop, Australia's first Saint, founded the Sisters of St Joseph in

1867. At the headquarters of the Order in North Sydney, they are turning a

ragtag rabble of buildings into a national shrine. But the Order was

concerned that its redevelopment of the site might be seen as a grab to turn

a quick quid from Mary's beatification. The solution was to ensure an

exhaustive program of consultation with the local council and the

surrounding neighbourhood before the development application was made.

It resulted in the Order's fear being overcome.

The Order of St Joseph's pre-emption was to take its case to all the

people affected - including the community - before making any formal

move. Maybe this was overcautious but there was a reputation of

great integrity to protect.

The Independent Panel on Intractable Waste was appointed by the

Commonwealth, NSW and Victorian Governments to determine what to do

with Australia's stockpile of toxic waste given community opposition to the

building of a high temperature incinerator. The Panel decided that, before

seeking to find a means of disposing of the waste, it should first define

precisely the problem for itself and the rest of the community.

So the issue was exhaustively reviewed through public consultation, expert

hearings, a comprehensive review of documentation and research. The

outcome was recognition that the toxic waste issue was not a single problem

- it was a range of problems. This was the key that unlocked the door to a

successful resolution.

A range of problems required a range of solutions and, once on this track,

the Panel identified a number of acceptable alternative technologies to deal

with the waste.

The Independent Panel's pre-emption involved not leaping to a

conclusion before everybody understood the problem and the various

options for resolving it. The panel took the community along with it

as it tracked through a public enactment of the scientific method in a

logical, step by step way.

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The point about each of these interventions is that, irrespective of how

obvious the strategy may seem in retrospect, it was deliberate, pre-

emptive action that secured success. This action was planned, not

random. And it was planned in a thoughtful and structured way.

Being pre-emptive allows you to plan your way through issues and to

strongly influence, and often determine, their outcome.

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10 - The practice of issues management

1 - Assign responsibility for forecasting issues

Assigning responsibility for forecasting and assessing issues does not

mean centralised control but certainly there has to be a uniformity of

approach and a good exchange of information across the organisation.

Issue forecasting is the research part of issues management. In

forecasting issues an organisation scans the environment and uses

collected information to determine how it and its stakeholders might

react to a future event, trend or controversy.

Research by Cranfield School of Management, a business school in the UK,

revealed companies that addressed planning and forecasting issues

consistently outperform sector averages. These companies had an average

share price growth of 116% over three years (101% sector average),

2 - Develop monitoring & analysis skills

Having developed skills in identifying, monitoring and analysing

emergent issues, decisions need to be made about how to deal with

them. This applies not just to current issues but also to emergent or

over-the-horizon possibilities.

Most problems are foreseeable to some extent and - even if specific

issues can't be pinpointed - experience will suggest which parts of the

organisation are most vulnerable and which stakeholders most likely

to pose problems.

A wide network of contacts, a good knowledge of the organisation's

strengths and weaknesses, and a sensitivity to the climate of opinion

in which the organisation is operating, are all helpful in detecting

pertinent issues.

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There are training programs available in detecting and managing

issues – such as the well-proven program offered by Jackson Wells

Morris.

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HOW TO BRAINSTORM ISSUES

· Convene a suitable group of people.

· Brief the group on the process (suspend judgement,

keep an open mind, let yourself go, all ideas accepted,

build on others' ideas).

· Record ideas so everyone can see them.

· Assemble the issues into categories.

· Ask the group to prioritise the issue categories.

· Refer the issues for analysis and strategy development.

3 - Analyse the issues

Gather together relevant background information including statistical,

documentary and other data to table all there is to know about the key

issues and their context.

HOW TO ANALYSE AN ISSUE

· Compile a history and background of issue.

· Identify the internal and external stakeholders.

· Assess influence of corporate policy on issue.

· Review research conducted into issue.

· Gather statistics that might help clarify issue.

· Define positives and negatives of issue.

· Analyse threats and opportunities around issue.

· Prepare forecast of best and worst case outcomes.

· Appoint manager responsible for dealing with issue.

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4 - Create a data base

The effective management of issues requires the maintenance of a

comprehensive and systematised body of information that can ‘stack

and track’ the main issues facing the organisation. A continually

updated database will keep issues under review.

Issues can be prioritised according to their impact and urgency, with

high impact/high urgency issues requiring a crisis management

response. This chart depicts possible management responses to issues

of varying impact and urgency.

Issue prioritisation chart

5 - Develop an efficient system of notification

A good referral system will ensure the Board, chief executive and

senior managers are alerted immediately new issues or major

communication problems arise. Action taken may vary from a simple

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Issue has high impact & low urgency

Response: Contingency planning

Issue has high impact & moderate urgency

Response: Action planning

Issue has high impact & high urgency

Response: Crisis planning & execution

Issue has moderate impact & low urgency

Response: Document in database & keep

under review

Issue has moderate impact & moderate

urgency

Response: Contingency planning

Issue has moderate impact & high urgency

Response: Action planning

Issue has low impact & low urgency

Response: Document in database & accept

risk

Issue has low impact & moderate urgency

Response: Document in database & keep

under review

Issue has low impact & high urgency

Response: Contingency planning

media release or internal memo to more complex programs of activity

to remedy a matter having serious implications for the organisation.

6 - Deploy resources to deal effectively with the issues

These may include:

people to plan, organise and coordinate a campaign

budget to employ expertise, produce publications, buy

space for advocacy ads etc

time taken to explain to employees, customers or other

stakeholders what is going on; time taken to listen to what the

involved stakeholders have to say

7 - Establish effective contacts with key stakeholders

Formal networks of reporting, consultation, coordination and advice

need to be in place. These must be supplemented by the development

of widely dispersed informal networks; not merely to provide social or

professional opportunities but to gather useful information. Issues

cannot be properly managed unless there is a profusion of such

networks and some assurance that the information moving through

them actually ends up somewhere useful.

8 - Be aware that decisions may have inadvertent impacts

Most managers have the capacity to take actions that may become

matters of public comment and controversy. In practical terms, this

not only means making good decisions but communicating them

effectively, warning if adverse public reaction is anticipated and

ensuring the Minister and managers are equipped to deal with this.

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9 - Assess the public impact

The public impact of an action must be a consideration when decisions

of importance are made - and thinking through how they should be

communicated. Among the important questions are: Who will be

affected? What is their likely reaction? What affect will this have on

the organisation? What are the political implications? How can we

optimise our position? Sometimes these considerations will affect the

substance of the decision itself. More frequently, they will affect the

way in which the decision is implemented.

10 -Assure a good inwards flow of information

Issues management is not only concerned to ensure a good and

reliable outward flow of information. It is crucial, also, that there be a

reciprocal flow into and around the organisation. While none of us

should be guided wholly by public opinion or the views of pressure

groups, such attitudes must be taken into account when decisions are

being made. There must be a continuing awareness of the position of

key constituencies.

11 - Disseminate messages to create the desired response

This also means being sensitive to the impact of words; to ensuring

you say what you mean - and mean what you say; and to making sure

that what you say today won't come back to haunt you in the future.

12 - Build rapport with key groups

The more hostile the group you are dealing with, the greater need for

personal (face-to-face) communication.

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13 - Accept responsibility for error

Never try to defend the indefensible. If there has been an error or

negligence, providing litigation is not pending, a full admission should

be made together with an announcement outlining what corrective

measures are being taken. Toughing things out is not a plausible

option, especially for organisations with a clear accountability to the

public or to shareholders.

"Honesty is the best policy" certainly applies to issues management.

As damaging as it may seem to have to admit error, it is nowhere near

as damaging as it is to be caught out later. Adopting a policy of

candour with the media is vital. This does not mean that the press

have the right to know everything. But it does mean that they have

the right not to be deceived.

14 - Explain and defend the organisation publicly

All organisations must expect to be criticised from time to time and

must react maturely to this. This means not lashing out intemperately.

If criticism is not factually based or flows from misunderstanding, it

should be addressed directly and dispassionately.

15 - Provide media training

It's important that management communicate competently in public.

There is a need to conduct interviews so key messages are

communicated. Formal media training, anything from a few hours to

regular refreshers, and even training in public speaking may be

required. Depending upon the issues, rehearsals may also be

required.

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16 - Build media relations

The news media will be one of the most important conduits for

delivering information. It is important that the organisational

management establish a good network in the local media: finding out

who they are, dealing with them on a personal basis and making sure

they know you and your key managers and that they understand what

your organisation does and what its major programs are. Regular

press briefings, even when there is no major announcement or story,

are a good idea.

Briefings should include media owners and editors not just working

journalists. Conducts these meetings when your organisation is not in

crisis or beset by problems to present information in a balanced non-

controversial context. Make sure the media have contact numbers

and that they are re aware they can contact you or your spokespeople

any time. Plan an approach for dealing with the media in crisis

situations.

17 - Develop communications materials

Depending upon the level of previous communications, the community

may have only a vague idea of exactly what your organisation does.

This is where materials may be important: brochures, handbooks, fact

sheets, internal talking points for managers, videos, kids' workbooks,

posters, stickers, badges, bookmarks, etc.

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