We all love to use the word strategy and this is the natural level at which a communicator should be thinking. Our efforts are a major part of what makes strategy – the way in which the organization will realize its objectives – work.
But much as we like to talk about it, it’s also easy to forget what real strategy looks like. I recently had a valuable reminder about corporate strategy and how it applies to risk management and public expectations.
We were recently onboarding with a new client, a multidimensional company with different sub-businesses in 5 main verticals, so it was critical that we really got to understand their business quickly. We began by conducting a fairly straightforward evaluation of their corporate risks and their readiness for crisis situations. We used my Strategic, Preventable, and External risk framework to identify what we perceived as their areas of vulnerability, as well as the gaps in their readiness.
The Director of Strategy was a part of the team that engaged us and, as we were proceeding with our initial review, she asked us to add an extra work stream to our project. They are currently in the second year of a five-year strategic plan and a year-end review is a typical part of their process. The Director of Strategy asked us to be a part of this annual check-up of their corporate strategy.
We joined a team of stakeholders from across the company to review their corporate strategy, seeking to validate the plan and refine or update as needed. This was not a business planning process, but more focused on the corporate level, not the individual business units.
Needless to say, being asked to showcase communications and specifically public risk to the operations and executive leadership of this company was music to my ears.
Elements of a strategy
The Director of Strategy shared the strategy document which outlines their goals built around a very clear mission: creating value for the organization. The associated review document outlined four key elements which the Director of Strategy described as critical to achieving the main elements of their strategy:
- Allocation of resources,
- Organizational design,
- Portfolio management, and
- Strategic trade-offs.
We diligently set about considering the Strategic trade-offs as a logical place for us to apply our crisis and reputation experience. After a series of conversations with the operations team, learning how they manage risks and how these fit into their business, we had some considerations to share on trade-offs. Up to this point, it was pretty straightforward communications consulting fare. However, I was surprised when the Director of Strategy asked for our input on all elements of the review.
But not surprised in a bad way. Quite the opposite.
I was encouraged that the organization, prompted by the Director of Strategy, was taking a really strategic view. Unlike other situations where organizations say they are taking a strategic view, this was a genuine case where they really were looking at the overall strategy and thinking about how to achieve it. Moreover, they were also thinking about the role that communications plays in the success of the strategy.
Obviously the discussions I had with this client are confidential but I wanted to highlight some of my thinking around these four elements as ways where, as a communicator, you can support and enable your organization’s strategy.
Allocation of resources.
This was a primary focus for the client as they actively pursue mergers and acquisition opportunities and manage a number of internal and external projects. A critical risk here concerns setting and meeting expectations: the expectations of the public, as well as the expectations of their internal stakeholders. In this context, I think that there are two key considerations as far as allocating resources is concerned. Firstly, there is the operational matter of not biting off more that you can chew. If you cannot allocate the appropriate resources to manage all your workstreams, something will suffer and along the way, someone’s expectations will not be met. As a communicator, there may be little you can do to avoid this but you should monitor progress on the organization’s major work streams carefully. Be prepared to manage the fallout and the impact on the groups that matter most to reputational success if things fall behind or fail.
Secondly, you need to allocate the appropriate communications resources to support each workstream. But a small comms team can easily get overwhelmed when a number of major projects are running simultaneously so you also need to manage your own resources.
Addressing both cases will ensure that you avoid a strategic risk: you fail to meet expectations either because the initiative was unsuccessful or the expectations were unrealistic. Careful allocation of resources – including communications – will ensure that your initiative is properly supported and that the communications assets you need are in place to support your strategy.
With organizational design, there are again two aspects to this. To me, organizational design is fundamentally about chain of command. This fits directly with our understanding of how decision-making needs to be done in a crisis but effective organizational design also ensures that day-to-day business runs smoothly. This efficiency will often help avoid Preventable risks as proactive action can take place as soon as an issue is spotted, preventing a crisis in the first place.
However, there are also cases where Strategic, Preventable, and External risks can lead to an incident or issue. In these cases, speed, aligned with mission and values, is the critical element.
An effective chain of command equals speed: speed in developing understanding of the situation, speed in decision-making and speed of execution. Good organizational design will ensure that an effective, efficient chain of command is in place to provide both the proactive and reactive steps necessary to manage risks.
Portfolio management concerns knowing where the business plays, developing a macro view of the potential business areas they may want to pursue and understanding how these fit together. From this, the business can create business-level planning for each individual unit. Each portfolio area, and the internal dynamics between business units, will create expectaions and potential frictions. These need to be simultaneously managed but also balanced, particularly in an organization like this client which is large and complicated.
Understanding how to develop and support expectations without generating mixed or conflicting messages is important to ensure your strategy is successful. Senior management will need to become involved to explain any apparent imbalances between portfolios to critical stakeholders and they will need your support to achieve this. As communicators, we need to remain continually engaged in this balancing act as a key conduit between the external environment and the senior leadership.
In this case, strategic trade-offs was the point at which we began our engagement. Fundamentally this is about balancing risk and return, understanding how a leadership position in a marketplace will impact their reputation and determining how the public will view bold moves. Strategic trade-offs also have to be made between portfolios, in organizational design and in the allocation of resources so this element actually runs continuously. Again, as communicators, we bring a unique perspective to the negotiations around these trade-offs, particularly where things that are operationally sound have negative reputational consequences. Our job is to ensure that we don’t win an operational battle but lose the reputational war for public opinion.
Aligning strategy with expectations
This project has also been a useful reminder for me about what ‘real’ strategy looks like and how we as communicators can support that.
Communicators have to be deeply involved with strategic planning, bringing their mastery of public expectation and an understanding of reputation risk into organizational planning. You are a key partner at the beginning, middle, and end of the strategy design process.
Think about the kinds of risks you face: the Strategic risks that stem from decisions that the company makes for superior returns; Preventable risks that simply shouldn’t happen; or External risks that are outside control of the organization.
But before you jump into the details and consider the specific risks, review the organization’s overall strategy. Think about how the allocation of resources, organizational design, portfolio management and strategic trade-offs inherent in that strategy and how these might generate their own risks.
We are still at an early stage with this organization and have yet to see how this process unfolds but the signs are very positive. I am very confident that taking reputational risk into account and focusing on the expectations of their various communities – both external and internal – will help them manage risk across the organization and thus achieve their goals. Marrying this with the business level work that we’re going to do is going to make for an exciting project and I hope that I can share more insights as we progress.