Public Affairs ManagementPublic Affairs Management
Public Issues Managing the Public Affairs Function Issue Management Crisis Management
ChapterChapter
2
Public issuesPublic issues
Public issue
An issue that is of concern to an organization’s stakeholders. Stakeholder expectations
A mixture of people’s opinions, attitudes, and beliefs about what constitutes reasonable business behavior.
Performance-expectations gapA gap between what stakeholders expect and what an
organization is actually doing.
Figure 2.1
A stakeholder network focusing on a public issue
Stakeholders
with a shared focus
on an issue
Stakeholders
with a shared focus
on an issue
Stakeholders
with a shared focus
on an issue
Stakeholders
with a shared focus
on an issue
Stakeholders
with a shared focus
on an issue
Phases of the public issue life cyclePhases of the public issue life cycle
Phase 1: Changing Stakeholder ExpectationsWhen a performance-expectation gap emerges, the seeds of a public issue have been sown.
Phase 2: Political ActionWhen a problem is placed on the agenda for government action.
Phase 3: Formal Government ActionWhen legislative proposals or draft regulations emerge. Characterized also by an increased number of people involved in the conflict.
Phase 4: Legal ImplementationWhen a new law or regulation is implemented and companies are forced to comply with the law.
Figure 2.2
The public issue life cycle
High
Low Time
Life Cycle of IssueManagementDiscretion
Lev
el o
f S
tak
ehol
der
Con
cern
s Phase 1:Changing
StakeholderExpectations
Phase 2:Political Action
Phase 3:Formal
GovernmentAction
Phase 4:Legal
Implementation
Managementdiscretion to resolve the issue
Public affairs activitiesPublic affairs activities
External forces Loss of public trust institutions Globalization of world markets Rise of the Internet
Internal forces Better communication within organizations More experience dealing with significant change and complexity Growing focus on the interplay between the organization, its
environment, and its strategies Public affairs management
The active management of a company’s external relations, especially its relations with external stakeholders such as government and regulatory agencies, customers, investors, and communities.
Corporate public affairs activities of Corporate public affairs activities of 250 companies250 companies
Table 2.1a
Activity Percentage of RespondentsPolitical action committee 89%
State government relations 84%
Issue management 84%
Local government relations 77%
Direct corporate contributions 75%
Community relations 75%
Business/trade association membership 73%
Public policy group relations 73%
Grassroots communication 71%
Corporate foundation 71%
Corporate public affairs activities of Corporate public affairs activities of 250 companies250 companies
Table 2.1b
Activity Percentage of RespondentsEmployee volunteer programs 66%
Media relations 64%
Public relations 61%
Employee communications 59%
Strategic philanthropy 55%
Regulatory affairs 43%
Educational relations 34%
International public affairs 32%
Environmental affairs 23%
Stockholder relations 21%
Public affairs management’s relevant Public affairs management’s relevant stakeholders and functionsstakeholders and functions
Figure 2.3a
Government
• Public policy
•Lobbying
•Political action
• Trade associations
• Advocacy ads
• Grassroots mobilization
Public Affairs Management
Stockholders
• External and internal audit
• SEC filings, compliance
• Communications
• Proxy election management
Public affairs management’s relevant Public affairs management’s relevant stakeholders and functionsstakeholders and functions
Figure 2.3b
Public Affairs Management
Employee
• Communications
• Union negotiations
• OSHA, EEOC, and labor law compliance
• Diversity and family-work programs
Customers
• Customer service
• Total quality management
• Liability lawsuit defense
• Recall management
Public affairs management’s relevant Public affairs management’s relevant stakeholders and functionsstakeholders and functions
Figure 2.3c
Public Affairs Management
Environment
• EPA and state environmental compliance
• Internal environmental auditing
• Recycling, take-back programs
Community
• Corporate philanthropy
• Partners with schools, NGOs
• Volunteerism, employee time contributions
Public affairs management’s relevant Public affairs management’s relevant stakeholders and functionsstakeholders and functions
Figure 2.3d
Public Affairs Management
Media
• Public relations
• Executive speeches
• Image advertising
• Crisis management
• Web page management
Activists, General Public
• Environmental scanning
• Stakeholder dialogue
• Social reporting
• Social monitoring
An effective public affairs function must:An effective public affairs function must:
Manage public affairs as an ongoing, year-round process. Cultivate and harvest the capability to build, develop, and
maintain enduring stakeholder relationships. Influence stakeholders using refined information. Recognize the importance of managing the grass roots. Communicate in an integrated manner. Continuously align its values and strategy with public’s interests. Improve its external relations using the accepted facts of
contemporary management practice.
Issue managementIssue management
A structured and systematic process to aid organizations in identifying, monitoring, and selecting public issues that warrant organizational action.
Environmental intelligenceThe acquisition of information gained from analyzing the
multiple environments affecting organizations. Customer Competitor Economic Technological Social Political Legal Geophysical
Eight strategic radar screensEight strategic radar screens
Figure 2.4
Seeking
Environmental
Intelligence
Customer
Environment Competitor
Environment
Legal
Environment
Geophysical
Environment
Political
Environment
Technological
EnvironmentSocial
Environment
Economic
Environment
Figure 2.5
The issue management process
PolicyOptions
ProgramDesign
Results
Issues Identification
IssuesAnalysis
Research
Judgment and priority
setting
Policy andstrategy selection
Implementation
Performance evaluation
Crisis managementCrisis management
Corporate crisis
A significant business disruption that stimulates extensive news media coverage.
Crisis management
The process organizations use to respond to short-term and immediate corporate crises.
An effect crisis management plan involves:An effect crisis management plan involves:
Preparing for action by creating an internal communication system that can be activated the moment the crisis occurs.
Communicating quickly, but accurately. Using the Internet to convey the public affairs message. Doing the right thing by not minimizing the seriousness of a
problem nor exaggerating minor incidents. Following up and, where appropriate, making amends to those
affected.