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Transcript of 1. 2 THE AUTHENTIC ENTERPRISE Relationships, Values and the Evolution of Corporate Communications...
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THE AUTHENTIC ENTERPRISE Relationships, Values and the Evolution of Corporate Communications
Roger BoltonAPCO Worldwide
Arthur W. Page Society Beijing, ChinaNovember 13, 2008
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“All business in a democratic society begins with public permission and exists by public approval.”
“All business in a democratic society begins with public permission and exists by public approval.”
ARTHUR W. PAGE
• VP PR of AT&T, ’27 – ’46• Corporate officer
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THE WORLD IS CHANGING
Rapidly changing context for global business
At stake:
Ability to manage relationships
Competition over identity
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GLOBALIZATION
The “Flat World” is reshaping the corporation.
Shifting from hierarchical, monolithic, multinational …
… to horizontal, networked and globally integrated.
Operations are componentized, virtualized and distributed over an ecosystem of business relationships.
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108 million blogs, increasing by 175,000 daily
Nearly one billion camera phones worldwide
Second Life – 14 million people, 80 countries
YouTube – 100 million videos/day
THE DIGITAL NETWORK REVOLUTION
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STAKEHOLDER EMPOWERMENT
0
10
20
30
40
50
60
Me Acad. Doc NGO CEO Blog
U.S. Credible SpokespersonsEdelman Trust Barometer 2008
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STAKEHOLDER EMPOWERMENT
COMPANY
EMPLOYEES
ACADEMICCOMMUNITY
GOVERNMENT MEDIA
INVESTORS CONSUMERS
LOCALCOMMUNITY
NGOs
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STAKEHOLDER EMPOWERMENT
COMPANY
EMPLOYEES
ACADEMICCOMMUNITY
GOVERNMENT MEDIA
INVESTORS CONSUMERS
LOCALCOMMUNITY
NGOs
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DRIVERS OF CHANGE
Implications for enterprises:
Threats … Influential new stakeholders Demands for transparency Less control over messaging, segmentation Risks to brand and reputation Regulatory activism
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DRIVERS OF CHANGE
Implications for enterprises:
And opportunities … To reach stakeholders To advance policy interests To build brand To enhance reputation
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THE AUTHENTIC ENTERPRISE
In this dynamic and radically open environment, a company must answer:
What business are we in? What markets do we serve? What differentiates us? What do we value? What will endure?
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In place of the voice of “authority”, stakeholders demand proof of authenticity
In place of the voice of “authority”, stakeholders demand proof of authenticity
The enterprise must be grounded in a sure sense of what defines and differentiates it (mission, values, principles, beliefs).
And those definitions must dictate consistent behavior and actions.
THE AUTHENTIC ENTERPRISE
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To be authentic an enterprise must:
Define and instill company values
Build and manage multi-stakeholder relationships
Enable its people with “new media” skills and tools
Build and manage trust
A CALL TO ACTION
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THE VALUE OF VALUES
Our Credo
We believe our first responsibility is to the doctors, nurses and patients,
to mothers and fathers and all others who use our products and services.
In meeting their needs everything we do must be of high quality.
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Aetna in the 90s
Put customers and shareholders first
Strong form managed care– Referrals
– Pre-authorizations
– Denials
STAKEHOLDER RELATIONSHIPS
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Anti Managed Care Backlash
Physicians, patients rebelled Government mandates
STAKEHOLDER RELATIONSHIPS
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New CEO - A Doctor New values – The Aetna Way Balance the needs of ALL constituents
New approaches Settle lawsuit
STAKEHOLDER RELATIONSHIPS
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STAKEHOLDER RELATIONSHIPS
Coca-Cola
Activists targeted Coke’s India operations Allegation: pollution and water scarcity
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STAKEHOLDER RELATIONSHIPS
Coca-Cola Stakeholder Engagement Group Mission:
Foster a positive business environment that will enable profitable growth …
… by building meaningful relationships and partnerships with diverse stakeholders
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STAKEHOLDER RELATIONSHIPS
Pledge to replace the water it uses
$20 million to help conserve seven of the world's most important freshwater river basins
Coca-Cola Partnership:
World Wildlife Fund
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How do you build relationships with disparate stakeholders?
Be transparent Listen Look for common ground Be willing to change
STAKEHOLDER RELATIONSHIPS
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Personal experiences with company’s employees 2 1 1 1 2 1 1 1.3
Analysts or professional organization opinions 1 2 3 2 1 2 2 1.9
Opinions of colleagues, peers, or friends 3 3 2 3 5 4 3 3.3
What companies are doing for others in your industry6 8 4 7 4 3 6 5.4
Company websites 5 6 5 8 3 5 10 6.0
White papers, research, or case studies 4 4 6 4 7 9 8 6.0
Articles in magazines or newspapers 7 9 10 9 8 6 4 7.6
Online sources, not directly from the company 10 7 7 6 9 8 7 7.7
Tradeshows, conferences, industry forums, events 8 5 9 5 6 10 11 7.7
Influence Source Brazil Ger Spain Italy India Sing JapanAverage
Rank
News stories on TV or radio 11 11 12 12 10 7 5 9.7
Advertising 9 10 11 10 11 11 9 10.1
Direct marketing (e-mail or mail) 12 12 8 11 12 12 12 11.3
Biggest Influence on Opinion about IBM
ENABLE NEW MEDIA SKILLS
IBM Survey of executives in seven countries
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ENABLE NEW MEDIA SKILLS
15.315.517.6
19.2
32.5
0
5
10
15
20
25
30
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News and infofrom a friend
working at thecorporation
News and infofrom a corporate
website
News and infofrom a corporate
blog site
News and infofrom localnewspaper
News and infofrom local TV
“You have $100 to spend for information on a corporation. Allocate this on how you would spend it for the information.”
Third Annual China Study – Edelman (Conducted by Harris Interactive)
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We continue to advocate IBMers' responsible involvement today in this new, rapidly growing space of relationship, learning and collaboration.
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Engagement with stakeholders R&D Internal consensus
• Siemens Values Fest
ENABLE NEW MEDIA SKILLS
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Emerging “social contract”
1889 – Carnegie, “Gospel of Wealth”
1931 – Berle and Dodd, Harvard Business Review
1960 – Packard – “a contribution to society.”
1970 – Friedman – “Profits.”
BUILDING TRUST
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Emerging “social contract”
Quality products and services at reasonable prices
Steady employment in a healthy and safe environment
Support for community institutions
BUILDING TRUST
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STAKEHOLDER EMPOWERMENT
0
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20
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Most Trusted Corporate HQ Countries
Edelman Trust Barometer 2008
Ger. Japan U.S. S. Kor. India China Russia
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Breaking the contract
1980s – Leveraged buyouts, re-engineering, outsourcing, short-termism, executive compensation
1987 – Gecko – “Greed is good.”
BUILDING TRUST
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Enron WorldCom HealthSouth TYCO HP MSO UnitedHealth
– Lay & Skilling– Ebbers & Fastow– Richard Scrushy– Dennis Kozlowski– Patricia Dunn– Martha Stewart– Bill McGuire
BUILDING TRUST
Breaking the contract
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BUILDING TRUST
79
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5458
63
45
6155
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Gov't Business Media NGOs
How much do you trust each of the following institutions to do what is right?
Edelman Trust Barometer 2008
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BUILDING TRUST
42
1613 10
57
2419 18
55
21 2218
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
GovernmentNGOs
BusinessMedia
China 07 China 06 China 05
How much do you trust each of the following institutions to do what is right?
Third Annual China Study – Edelman (Conducted by Harris Interactive)
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Corporate philanthropy
Cause marketing
Environmental responsibility
Good labor standards
BUILDING TRUST
Corporate Social Responsibility
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Focus on the core contribution that the enterprise makes to society
Align business objectives with the public interest
BUILDING TRUST
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BUILDING TRUST
Aetna Chairman’s Initiatives
• Genetic testing
• Care at the end of life
GE Ecomagination
GM Volt
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New Report:
“The Dynamics of Public Trust in Business – Emerging Opportunities for Leaders”
New partner:
Business Roundtable
Institute for Corporate Ethics
BUILDING TRUST
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“All business in a democratic society begins with public permission and exists by public approval.”
“All business in a democratic society begins with public permission and exists by public approval.”
ARTHUR W. PAGE
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How do you get “public permission” and “public approval?”
By being an authentic enterprise …
… that operates in the public interest – doing the right thing for all stakeholders –
... and does it consistently – up and down the entire organization.
THE AUTHENTIC ENTERPRISE
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Join the dialogue at Page Turner, the Arthur W. Page Society blog:
http://www.awpagesociety.com
THE AUTHENTIC ENTERPRISE
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THE AUTHENTIC ENTERPRISE Relationships, Values and the Evolution of Corporate Communications
Roger BoltonAPCO Worldwide
Arthur W. Page Society Beijing, ChinaNovember 13, 2008