To communicate a corporate message effectively turn it into a story, says Mandalay Entertainment Group chairman Peter Guber in Knowledge@Wharton. A consummate storyteller -- his films, such as Rain Man, Batman, The Color Purple, Midnight Express, and Flashdance, have earned more than $3 billion in worldwide revenue and more than 50 Academy Award nominations -- he argues that stories are more memorable and engaging than slide presentations, memos or sales pitches. Read his interview here.
Writer William J. Holstein's article for CEOs, "How to Manage the Media" was published in the Harvard Business School Press and summarized by BNET. Here are the key points:
CIT and Harris Interactive conducted a survey among U.S. business executives on the importance of intangible assets in driving company success. While 75% of respondents believe that 'networking with customers/prospects is more effective than traditional marketing,' over half (55%) report only attending 1-5 events annually.
| Number of Events Per Year | % of Respondents |
|---|---|
| 1-5 | 55% |
| 6-10 | 25 |
| 11-25 | 12 |
| 26-50 | 1 |
| 50 or more | 2 |
| None | 5 |
When networking, business executives prefer events that maximize personal interaction. The most popular networking events are:
Most CEOs turn to a select group of trusted advisors when making a major strategic decision. BATS Trading CEO David Cummings, on the other hand, turns to his 1,500 e-mail contacts. On February 27th, Cummings e-mailed everyone from traders to NYSE and NASDAQ executives seeking advice on how to best extend his electronic market to Europe. This is not the first time Cummings has used this mass e-mail tactic to pool the best and the brightest for advice. In the past, he has made job offers based on good advice he received back. (Business Week, March 17, 2007)
Investor dissatisfaction - and subsequent uprisings - are becoming more common. Today, it is considered bad form for leaders to shy away from the media spotlight. Shareholders are demanding that CEOs and chairmen remain visible. In the Financial Times (April 2004), Deborah Mattinson and Graeme Trayner of Opinion Leader Research posit just as “politicians are increasingly required to behave like business managers, business leaders are increasingly having to behave like politicians.
Despite corporate executives increased valuation of corporate communications, business schools are slow to incorporate communication courses into their MBA curriculum. Michael Sands, former president of Orbitz.com, tells The Wall Street Journal that “crisis communication is critical for business students, as is understanding how corporate communications gets integrated into the marketing plan.” One reason for the apparent information gap at business schools is that deans “don't realize the level of sophistication communications has reached and how it is being managed at a very high level within a corporation,” says James Rubin, an assistant professor at the Darden Graduate School of Business Administration at the University of Virginia. In response to the lack of supply of corporate communication studies at top business schools, the Public Relations Society of America has started a campaign addressing this shortcoming.
As the CEO becomes an increasingly public figure, mastering the art of public speaking is becoming an imperative to business success. Communication blunders during the quarterly investor call, in particular, have damaged CEO reputations and led to Wall Street backlash,according to The New York Times. Wishing to bypass such negative fallout caused by incoherent public statements, CEOs are relying on communications experts to help craft articulate messages. Quarterly calls are becoming a “tightly scripted affair.” The goal, according to consultant Virgil Scudder, is to “state your plan in a few succinct sentences.” For CEOs who have spent most of their careers crunching numbers and away from the public eye, the transition is difficult.
How important is it for directors to speak to the media? On one hand, most of the CEOs profiled in Jim Collin's best-selling book, From Good to Great, never give interviews. However, times are changing, as noted by Michael Skapinker of The Financial Times. We have entered a period of shareholder activism, where CEOs are punished for not effectively explaining to shareholders the ups and downs of a company's performance and reputation. In some cases, such as Eurotunnel in 2004, small shareholders have ousted the entire board of directors for their lack of candor and a forthcoming approach. Increasingly, business executives are forced to behave as politicians in responding daily to untrusting and demanding constituents. However, unlike politicians, business executives are fortunate in that they only have to connect with the shareholders, who hold most of the power, rather than a culturally, geographically, diverse electorate.
As competition for the best and the brightest undergraduates becomes tight among employers, top companies are using multiple avenues to communicate and recruit potential employees. The Economist reports that companies arrive on campus earlier than ever to conduct interviews in an effort to overcome their competition. Staff members are dedicated to touring campuses year round to keep their respective company's name a centerpiece of campus culture. Meanwhile, PricewaterhouseCoopers builds partnerships with 200 target schools, with “partners” spending up to 200 hours a year building relationships on campus. Senior executives make appearances at campus recruitment events to meet students and give speeches. Despite all the face-time firms are paying to campuses, students are heavily influenced by the quality of company Web sites. According to <a href="http://www.universumusa.com/undergraduate.html>Universums' annual survey revealing undergraduate's ideal employer, there is a strong correlation between student's choice in employer and their choice in most impressive Web site.
CEOs have a responsibility to communicate to a wide variety of stakeholders: employees, the board, shareholders, consumers, employees and analysts, to name a few. The New York Times' columnist Thomas Friedman argues that CEOs are failing to communicate to a very powerful constituent -politicians. Friedman calls the effect the “disappearance of an internationalist, pro-American business elite.” As the U.S. struggles with deficits in the budget, education, energy, and health care, business leaders remain silent as America slowly loses its competitive edge to emerging global forces. Friedman encourages business executives, despite their general conservative leaning and desire to keep a low profile in the post-Enron era, to become active citizens in ensuring America remains “globally focused and competitive.”
A Wall Street Journal interview (12.06.06) with Whole Foods CEO John Mackey revealed how many CEOs feel about the responsibility of communicating to stakeholders. When asked how his day-to-day job changed in recent years, Mackey states: "It has always evolved. I still have a strategic role. I have to be thinking about the future. I spend time talking with the media, to team members. I've been in New York talking with investors. As CEO of Whole Foods, I have expectations that are made of me to do things in a public way. And that requires a lot more time than it used to. To be perfectly honest, I don't like it all that much. I enjoy my privacy, my time with my wife and my close friends. Doing alot of ceremonial stuff, it's just kind of boring to me. I'd much rather be reading a good book or having a good conversation with someone."
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