Internationalization, digitalization and crisis management the new challenges of corporate communication

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1 Insights&Trends I44/2013 Communication Internationalization, crisis management the new challenges As the old saying goes, if you don t communicate, you don t exist. Today, in order to bring this idea up-to-date, we may say that we don t exist if we don t communicate internationally. Internationalization as well as the digital world and management of risks associated with these environments, are fundamental for a new that professionals are facing today According to the results of the European Communication Monitor, an annual study of the state and trends of the sector that this year encompassed 2,710 professionals from 43 European countries, 8 out 10 European professionals believe that their key mission is to manage international of their organization, although less than a half of these experts say that they have structures and strategies in place for achieving effectiveness of this management activity (47.3%). 72.5% of professionals believe that in the next few years the ability to communicate internationally will be even more important and should demonstrate cross-cultural approach to stakeholders who also have an international vision and thus act in the so-called global village. Operating in an ever-changing international environment full of opportunities, and managing a brand that is known and globally recognized mean that the risks grow too: 7 out 10 European experts had to face a crisis during the past year, be it of an institutional nature (campaigns carried out against a company or a sector), operational character (production failures, product withdrawals, etc.), management or leadership nature. As the European continent is going through the economic recession, 47.8% of the respondents report that they experienced several crisis situations during this period, while 31.9% say that they did not experience any crisis recently, and 20.3% say This document was prepared by Corporate Excellence Centre for Reputation Leadership and contains references to the 2013 European Communication Monitor, drawn up by the European Public Relations Education and Research Association (Euprera), the European Association of Communication Directors (EACD), and sponsored by Ketchum-Pleon.

2 The importance of the Communications Director s role in organizations grows every year that they faced a crisis once during this period. In this context, the most popular tool to fix the crisis used by experts was media relations (75.7%), followed by personal face-to-face (72.6%). Surprisingly, the social media were used only by 38.2% of the respondents despite the social media s generally increasing weight in the field of and the fact that many of these crisis situations actually originated from rumours in social networks. Unstoppable Growth of the Social Media Talking about means talking about internationalization, crisis management and digitalization. And in this sense, social networks have become key for strategy and the focus of attention when a company makes a move in the online environment. 72.5% of European directors and professionals believe that content published in the social media changes perceptions, and 57% emphasise the importance of this phenomenon for the company s employees. Thus networks work as a two-way street in terms of reputation: it is projected outwards from within, while the feedback affects it deeply inside. When we speak about the gap between the importance attached to different social media and the use of this resource, we mainly mean applications for mobile devices (-30.2% although they are No.3 by importance), followed by social networks (-21.3%, the most important source of information) and online videos (-20.8%, the second most important source of information). To a lesser extent, these are websites and blogs (-13.7%), Twitter (-13%), audio information (-10.8%) and photos (-10.6%). Managing New Digital Stakeholders Employees and their active stance in favour or against their organisations top the ranking of digital influence (58.1%), jointly with consumers (53.2%) and bloggers and community managers (51.4%). All of them make their voice heard in social networks while professionals struggle for new formulas of communicating with those who came to be called the new digital stakeholders. Only 37.7% of European professionals agree that their organisations are able to do it correctly. There is a strong probability that directors who personally are active users of the social media will stake on online strategies in their companies. These professionals use more tools in order to establish a connection with these new stakeholders in the digital environment by adjusting the company s messages to this environment, create multimedia and multichannel platforms on the Internet that contribute to an uninterrupted and open dialogue, generate content that may be shared by users and even encourage creation of content by the said stakeholders themselves. Speak the Language of Each Generation It is important to adjust to different environments (virtual or real) as well as different generations by distinguishing between native digital users (below 30 years old) and digital immigrants (above 30 years old). However, according to the Graph 1: Implementing mobile media is the key challenge for strategic Gap between importance and implementation of social media tools Mobile applications (Apps, Mobile Webs) Online communities (social networks) Online video Weblogs 13,7 21,3 20,8 30,2 Wikis 13,3 Microblogs (e.g. Twitter) Location-based services Online audio (e.g. podcasts) 13,0 12,3 10,8 Photo sharing 10,6 Slide sharing 9,6 Social bookmarks 8,9 Mash-ups 5,8 Source: European Communication Director Insights&Trends 2

3 Graph 2: Communicative assets of the CEO have a major impact on organisational success Important factors for the overall success of an organisation CEO s skills facing the media and large audiences 92,5% CEO s skills in interpersonal and small group settings 92,9% CEO s personal reputation 89,7% CEO s knowledge of strategic 83,7% Source: European Communication Director There is a strong probability that Communication Directors who personally are active users of the social media will stake on online strategies in their companies European Communication Monitor, 85.5% of professionals do not draw any practical difference between these two groups. Generation Y, born after 1980, is more interactive (89.2%), more involved in (76.2%) and, most importantly, more interested in receiving feedback and information (75.4%) compared to the older generation. The younger generation is more demanding in terms of transparency and active listening, less conformist with the status quo, more critical about the current situation, has less fear of authority figures. Communication that distinguishes between different generations is more common for agencies (73.5%) than for companies own departments (52.9%), which are less willing or prepared to do it. Between these two extremes we find departments of public administrations in Europe (64%) and NGOs (56.2%). Curiously, Southern countries and countries of the European Mediterranean region (especially France with its 25.6%), East European countries (Poland, the Czech Republic and Slovenia, to give just a few examples) and the Balkans (especially Croatia) are more aware of the need to differentiate between the generations and adjust accordingly. These countries are more likely to implement this difference in their strategies than the UK with only 13%, Germanic countries (Germany, Austria, the Netherlands, and partly even Switzerland) or Nordic countries (where Sweden is at the bottom of the list with its 13.3%, after Norway, Finland and Denmark). Communication Abilities and Reputation of the CEO An important part of a Communication Director s role is to ensure that the Company s Chief Executive Officer, his or her personality, charisma and authority enjoy an excellent reputation (89.7%), and that this reputation plays into the hands of the Company s reputation in general. This affects not only the Company s reputation, but also its economic results and its stock price at financial markets. However, few are the steps taken by professionals towards establishing mechanisms for measuring the leader s reputation. Only a moderate percentage of the respondents (76.9%) said they try to position the CEO in the public domain, creating an appropriate profile and associations with clear values by means of ad hoc strategies (57.1%) and corresponding tools (58.6%). Contrary to the case of adjusting to different generations, prominence of positioning the Company s chief executive and strategic management of his or her reputation is much more spread in the UK, Germanic countries (Germany and Austria) and Nordic countries (Denmark and Norway) than in Southern countries (Italy, Portugal) and the Balkans (Serbia and Croatia). In this sense, Spain demonstrates comparatively good results, in the middle of the list, similar to France, Poland, Sweden, the Netherlands or Slovenia. Apart from the CEO s positioning by managers, his or her own abilities and reputation are important (83.7%), especially in the situations of crisis or changing environment like Insights&Trends 3

4 now. This is important for transmitting messages to the mass media and designed for large audiences (92.5%) and, more importantly, for smaller groups or interpersonal (92.9%). Conclusion: from Advisory to Executive Influence Finally, despite all the progress made in this area recently, the 2013 European Communication Monitor shows that the function is much more likely to influence decisions in terms of counsel or advice to top management rather than through executive power of direct decision-making: professionals say they are generally listened to (79.4%) but usually not admitted to the decision-making level (75.7%). 71.5% respectively), followed by private companies (78.5% and 74.2%) and NGOs (78.5% and 78.2%), where the two ways of influence are reported to have almost equal weights. Communication directors are more influential in listed companies, although the gap between the two influence tools is larger (83.4% and 78%). Although there is still a lot to be done, especially in terms of bridging the gap between advisory function, strategic counselling and executive power in all organizations involved in, the European Communication Monitor shows that the importance of the Communications Director s role in organizations grows every year. Less attention to department s opinion and less possibility to take part in decisionmaking is observed in public institutions (74.7% and Insights&Trends 4

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