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The Stakeholder Approach
Corporate Communication
NMH
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The roles of communications
• Informing
• Advocating
• Dialoguing
• Types of communication– One-way– Two-way (Symmetrical/Asymmetrical)
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Stakeholders
StockholdersGovernmentRegulatorsBoards of DirectorsCommunity leaders
StockholdersGovernmentRegulatorsBoards of DirectorsCommunity leaders
AssociationsPolitical groupsProfessional societies
AssociationsPolitical groupsProfessional societies
SuppliersUnionsEmployees
SuppliersUnionsEmployees
ConsumersIndustrial purchasersService users
ConsumersIndustrial purchasersService users
Environmentalists MediaCommunity residents VotersMinorities Women Other publics
Environmentalists MediaCommunity residents VotersMinorities Women Other publics
Normative linkages
Functional linkages
Input
OutputDiffused
Enabling
Organization’s external linkages
”...a group or individual who can have an effect on or be affected by the organization.” - Freeman (1984)
Organization
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Four Key Linkages
• Enabling Linkages
• Functional Linkages– Input linkages– Output linkages
• Normative Linkages
• Diffused Linkages
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Enabling Linkage
• Organization could not exist without this linkage– Authorities– Shareholders– Legal System
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Functional Linkage
• Linkage that give input and take output
• Input Linkage– Employees– Unions– Suppliers
• Output Linkages– Customers– Other organizations– Individual consumers
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Normative Linkage
• Organizations that have common problems or similar values– Membership organizations– Professional groups– Associations
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Diffused Linkage
• Elements in society that are not clearly identified as a formal member of organization– Environmentalists– Community Residents– Media– Other Publics
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Corporate identity and reputation
CorporateIdentity
Names,Self-Representations
CustomerImage
CommunityImage
InvestorImage
EmployeeImage
Corporate Reputation
Fombrun, C. J., Reputation, Harvard Business School Press
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Reputational risk management cycle
Corporate Citizenshi
p
Corporate Performanc
e
Safety
Net
Opportunity Platform
Reputational Capital
Fombrun, C. J. et al., “Opportunity Platforms and Safety Nets: Corporate Citizenship and Reputational Risk,” Business and Society Review, 105:1, 85-106.
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Media
Activists
Investors
Employees
Partners
Customers
Regulators
Community
Safety
Net
Threat of BoycottThreat of Legal Action
Threat of Illegitimacy
Threat of Exposure
Threat of Misunderstanding
Threat of Defection
Threat of Rogue Behavior
Threat to Value
Managing the downside of reputational risk
Fombrun, C. J. et al., “Opportunity Platforms and Safety Nets: Corporate Citizenship and Reputational Risk,” Business and Society Review, 105:1, 85-106.
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CommunityMedia
Activists
Investors
Employees
Partners
Customers
Regulators
Opportunity
Platform
Promise of advocacy
Promise of legal action
Promise of legitimacy
Promise of favorable coverage
Promise of loyalty
Promise of collaboration
Promise of commitment
Promise of value
Managing the upside of reputational risk
Fombrun, C. J. et al., “Opportunity Platforms and Safety Nets: Corporate Citizenship and Reputational Risk,” Business and Society Review, 105:1, 85-106.
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What stakeholders want…
• Visibility information
• Virtue good organizational behavior
• Verifiability access to information
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The challenge...
“I’m sorry, but if you expect any self-respecting activist to believe a word you say about your commitment to human rights, then you are as arrogant as the PR firm that came up with this strategy.”
- Unknown ‘activist’ quoted in ‘How do we stand?’ People, Planet &
Profits, A Summary of the Shell Report 2000, Newsweek.
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Mess management:
Multiple perspectives
Descriptions of perceived relevant activity
Yields choices of...
Comparison of descriptions with the perceived reality
Actions to improve the
situation
Influenced by individuals’ mental models
A real-world situation of
concern
A real-world situation of
concern
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Mental models• Deeply held images of how the world works.
Explicit understandings. Implicit understandings.
• Represent the most important factors and the relationships that link them.
• Provide the context in which to view and interpret new material.
• Determine how stored information is relevant in a given situation.
• Frequently treated as if they were the truth!
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Mental modelsThe ladder
of inferenceReflexive loop Our beliefs affect what data we select next time
I makeASSUMPTIONS
based on the meanings I add
I takeACTIONbased on my beliefs
I drawCONCLUSIONS
I addMEANING
(cultural and personal)
I selectDATA
from what I observe
Observable “data” and
EXPERIENCES(as a video recorder
might capture)
I adoptBELIEFSabout the
world
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Applying the Ladder of Inference
The ladder provides a means to ask questions... What is the observable data behind that
statement?
Does everyone agree on what the data is?
Can you run through your reasoning?
How did we get from that data to these abstract assumptions?
When you said “[your inference],” did you mean ”[my interpretation of it]”?
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Essential skills for working with mental models
Reflection Becoming more aware of your own thinking and
reasoning.
Inquiry Inquiring into others’ thinking and reasoning.
Advocacy Making your own thinking and reasoning more
visible to others.
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Working with mental models Balancing Inquiry and
Advocacy• A palette of conversational and dialogue skills.
• Protocols for balancing inquiry and advocacy.
• Conversational recipes...
Post hoc examination of conversations.
Seeking generic strategies for improving use of recipes.
Ask for other’s perspectives (inquiry).
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Co-orienting stakeholders’ mental models for improved
communication
Organization’s perception of
Stakeholder A’s views
Organization’s perception of
Stakeholder A’s views
Stakeholder A’s definition
and evaluation of an issue
Stakeholder A’s definition
and evaluation of an issue
Stakeholder A’s perception of
organization’s views
Stakeholder A’s perception of
organization’s views
Organization’s definition
and evaluation of an issue
Organization’s definition
and evaluation of an issue
UNDERSTANDINGAGREEMENT
ACCURACY
CONGRUENCYCONGRUENCY
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Co-orientation states• True consensus
– The parties know they share an agreement on their evaluation of an issue.
• Dissensus – The parties hold conflicting views and are aware of their
differences.• False consensus
– The organization believes that the stakeholder agrees with them on a particular issue, or
– The stakeholder group mistakenly believes that the organization holds the same view that they do.
• False conflict– The parties believe that they disagree on an issue when in fact
they agree.
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Dialogue as the basis for communications
• Models of communication– Shannon and Weaver (1949) – focus on the medium– Cognition-based models – focus on the message
• Dialogue “...a sustained collective inquiry into everyday
experience and what we take for granted.”Senge, et.al. (1994). The Fifth Discipline Fieldbook
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Discussion
• Ability to acquire information
• Identify threats and opportunities (proactively)
• Conduct research
• Engage in individual and organizational reflection
• Organizational changes
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Influences on multiple perspectives
Levels of analysis • Cultural
– The “Cultural Iceberg”
• Organizational– Environmental factors– Structural factors
• Individual– Cognitive factors– Personality factors
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The cultural iceberg
Primarily in awareness
Primarily out of awareness
fine arts literaturedrama classical music popular music
folk dancing games cooking dress
notions of modesty conception of beauty cosmology ideals governing childrearing rules of descent
relationship to animals patterns of superior subordinate relations definition of sin courtship practices conception of justice incentives to work
notions of leadership tempo of work patterns of decision makingconception of cleanliness attitudes towards the dependent theory of disease
approaches to problem solving conception of status mobility eye behavior
roles in relation to status by age, sex, class, occupation, kinship etc..
conversational patterns in social contexts conception of past and future
definition of insanity nature of friendship ordering of time conception of “self”patterns of visual perception preference for competition or cooperation
body language social interaction rate notions of adolescence
notions about logic and validity patterns of handling emotions facial expressions
arrangement of physical space ...AND MUCH, MUCH MORE...