Peggy Simcic Brønn1 Issues Management and Environmental Scanning Chapter 7 Organizational and Managerial Communication

Peggy Simcic Brønn2 BUSINESS AS AN ECONOMIC INSTITUTION zLittle acknowledgement of external environment zProduce goods zProvide employment zPay dividends zSuccess measured in economic terms

Peggy Simcic Brønn3 BUSINESS AS SOCIO-POLITICAL INSTITUTION z1960’s - economic growth producing detrimental side effects zEmphasis on protecting human health, not environment per se

Peggy Simcic Brønn4 RISE OF PUBLIC ISSUES zPublic demand collective action and there is disagreement on solution ycivil rights yfeminist movement yconsumer movement yecology movement

Four Types of Issues zUniversal issues: have serious and imminent effects on a large number of people. Government action is expected since the issue is beyond the scope of private organizations zAdvocacy issues: potential problems foremost of the population that are identified by groups claiming to represent the broad public interest. Scope of problem suggests government intervention. zSelective issues: affect special interest group. Costs of dealing with them is passed on to general public. zTechnical issues: of little direct interest to the population and are left to experts. Note that an advocacy group may shift a technical issue to another group be redefining it. z The energy crisis z Health insurance reform z Medicaid reimbursement that results in cost shifting z Hazardous waste disposal that can be characterized as creation of an environmental threat TypeExample P.N. Reeves, “Issues management: The other side of strategic planning”, Hospital &Health Services Administration 38(2), Summer 1993

Peggy Simcic Brønn6 ISSUES MANAGEMENT zCoined in 1977 zNew Type of Corporate Communications zResponse to Increasing Criticism of Big Business zMethod of Monitoring the Environment zManaging New Challenges and Change zMid-1970s, Issues Became ‘Strategic’ Issues zOrganizations Became Proactive

Peggy Simcic Brønn7 Location of IM Programs z Public/Government Affairs z Corporate Planning z Corporate Communications z Issues Management

Source: McGrath, G., Issues Management, IABC

Theory and Research Judgement and Priority Setting Policy and Strategy Selection Implementation Performance Evaluation Issues Identification Issues Analysis Policy Options Program Design Results Issues Management Process The Chase-Jones Model

The Clarity - Priority Matrix High Low Clear“Fuzzy” J.C. Camillus and D.K. Datta, “Managing strategic issues in a turbulent environment”, Long Range Planning 24, April 1991 Issue Clarity Issue Priority

Structure of an issues monitoring team

Peggy Simcic Brønn12 Four functions: zSharpening planning for responsible adapting the organization zKnowing and exceeding standards zMonitoring issues zCommunicating to build beneficial relationships

Peggy Simcic Brønn13 Corporate Response to Issues zReactive - Fight Change zAccommodative - Adapt to Change zProactive - Influence Change zInteractive - Adjust to and Influence Change

The Public Issues Life Cycle T.G. Marx,”Strategic planning for public affairs”, Long Range Planning, 23(1), Increasing Effectiveness of Integrated Planning Social Expectation PoliticalLegislativeSocial Control Education reform Global warming Day care Shorter work week Comparable worth Road congestion Groundwater protection Acid rain Clean Air Act Amendments Energy taxes Health care reform Hazardous waste treatment Environmental Protection Agency Motor Vehicle Safety and Health Admin. Energy Policy and Conservation Act Safety belt use laws Emission standards Environmental permits Gas guzzler taxes Product recalls Plant inspections/fines Fuel economy standards

IM and Corporate Image z IM now includes fostering and maintaining corporate image z Tied to behavior of organization and communication management z Integrity of the organizational identity

Peggy Simcic Brønn16 ORGANIZATIONS HAVE TWO CHOICES zReactive business strategy ypursue own financial goals ybe forced by external agents to change zProactive business strategy yactively seek operations that limit consequences yopen up dialogue with external agents

Peggy Simcic Brønn17 Environmental Scanning A methodology for collecting and analyzing information about every sector of the external environment that can help management to plan for the organization’s future.... A radar-like vigilance used to spot potential or actual issues at their earliest point of development. (Heath) Chun Wei Choo

Peggy Simcic Brønn18 Added value of scanning zPromotes education and mind- stretching experiences for management. zAssists in formulating of policy and strategy. zPromotes the development of operational programs and action plans. zProvides a frame of reference for budgets.

Peggy Simcic Brønn19 Organizational environment zDoes the company accept new ideas, concepts and processes? zAre there open communications channels? zIs the company capturing environmental information that is readily available`?

Peggy Simcic Brønn20 Organizational environment zAre the linkages of change to the company’s operations properly assessed? zIs environmental intelligence integrated into strategic planning?

Operational Competitive Stakeholders Financial Technological Governments Economies Control Productivity Capacity Resources Governments Economies Capital Markets Money Markets Governments Economies Industries Markets Products Society Shareholders Customers Suppliers Community Employees Governments Applied Developed Emerging In Process Conceptualized Boundaries of Knowledge Governments Environmental Scanning Dimensions

Peggy Simcic Brønn22 Approaches to Scanning zScientific -- social scientific measures of stakeholders to determine ‘what’s going on out there’ yTree Diagrams, Trend Impact Analysis yFlow Charting, Morphological Models zInformal -- individualistic, subjective techniques, nonrepresentative samples of publics, and key contacts

Sources of Environmental Information External PEOPLE SOURCESEVENT, OBJECTS Business-related Bankers Customers Suppliers Consultants Unrelated Regular associations Friend Professional peers Periodic encounters Adjoining seat occupant Neighbor Media-related Sources General Business & Financial Trade Technical/Academic Other Sources Purchased research reports Technical conferences Trade shows Educational seminars Direct observation

Sources of Environmental Information PEOPLE SOURCESEVENT, OBJECTS Internal Line Relationships Superiors Subordinates Staff Relationships Peer Relationships Counterpart Relationships (cross-divisional) Other (motivated by personal relationships, mutual interest) Reports Progress Performance Projection Activity Meetings Scheduled Issue-motivated

Peggy Simcic Brønn25 Ranking of Sources of Environmental Information RankSource Pct. Ranking 1st/2nd 1Daily Newspapers91 2Expert Organizations59 Publications (Conferences Board, etc..) 3Business Periodicals52 4Futures Consultants42 and Forecasters 5Government Publications42 6Seminars and Conferences30

Best Practices zPlanning and manage scanning as a strategic activity zImplement scanning as a formal system zPartner with domain experts and IT specialists in designing system zManage information as the core of the scanning function

Peggy Simcic Brønn27 zRead utopian and science fiction. zRead magazines like The Futurist and Futures. Borrow the authors’ predictions. zMonitor the writings of politicians and social scientists. zWatch out for mention of areas of people who adopt innovation early. Starting to think about the future J. D. Stoffels

Two cases z Playtex Company and the Sippy Cup z Intel