ISL451U-BUSINESS COMMUNICATION
Chapter 4: Corporate Communications
The Concept of Corporate Communications, its Definition and Scope
Corporations are social constructs that come about as a result of human need. First corporations were formed during a time when people realized that as they were struggling to meet certain needs, they could not do so without the help of another or others. A corporation is an ongoing system that carries out basic functions aimed at realizing certain goals within a social group or society and is related to other corporate bodies.
The main characteristics of a corporation can be listed as follows (Aktan and Vural, 2006):
• Corporations are formed as a result of the behaviour and actions of people who live together. • Corporations have a long existence and they change over time. • Knowledge, learning and experience play an important role in the formation, acceptance and popularization of corporations. • Corporations are different in every society as each society has different habits, customs, values and beliefs. • Corporations are a combination of both formal and informal rules.
The Scope of Corporate Communications
Corporate communications support the informational movement with internal and external stakeholders related to the organisational functions. However, this idea expresses a mechanical understanding of information rather than communication which is about the transfer of specific information chosen to be shared with recipients by the corporation or the organisation.
On the other hand, the concept of corporate communications emphasizes the interactive and analytical nature of its process in addition to the active role of the recipients. This represents the management of interaction as the basic goal of corporate communications.
The reasons that necessitate corporate communications can be found below:
• Traditional mass media communications are primarily capable of stimulating awareness and attitudes, but much less of stimulating or directly influencing demand. • Corporate expenses are increasing and there is a need to have more effect on stakeholders. • The fact that many products and brands are of similar quality and brand differentiation is low increases the need to make a difference through communication. • Audiences and markets tend to become more and more fragmented, making mass media less effective. This increases the need for more
specialised and fragmented media that can appeal to narrower and narrower markets. • Mainly as a result of technological developments and innovations, new marketing and marketing communication tools are coming into use. Thus, through interactive communication, the barriers between the sender and the recipient are removed and marketing becomes more and more receiver- oriented. • As the communications literacy on the part of the consumer increases, the communication methods that are used to reach the change. This situation forces companies to move towards a fragmented and increasingly interactive communications tools. • Organisations are increasingly communicating with multiple audiences. Target audience uses different communication tools and channels. Hence, the goal is to ensure that the mission, corporate identity and core propositions of the organisation are communicated through appropriate communication tools to all target groups. • As the importance of creating customer loyalty increases, integrated marketing communications focus on establishing long-term relations with the target audience. • Due to the globalisation of the market, corporations need to be consistent in everything they communicate in all countries in which it markets its products.
The Goals and Functions of Corporate Communications
Corporate communications as an encompassing umbrella term is a management function that coordinates all internal and external activities under a single authority.
The main goal of corporate communications is to protect the corporate values, to motivate employees, to support the creation of a strong corporate culture in order to create a strong brand, and at the same time to bring together the existential components that make up the corporation.
Another goal of corporate communications is to create a perception in all stakeholders of a transparent, trustworthy, stable and strong corporation; to protect and strengthen that perception.
There are four goals that corporate communications is expected to fulfil:
• Supporting internal and external activities of a corporation (organising), • Creating an identity for the corporation and product management (persuading), • Informing the intended internal and external audience (informing), • Ensuring the socialisation of individuals as good corporate citizens (unifying).
The functions and goals of corporate communications are listed below:
• Corporate communications connects corporate employees and their departments with one another; ensuring that they work in harmony and coordination. • Corporate communications ensures the continuation of activities within a corporation, the resolving of issues in the shortest time possible and the formation of a creative force. • Corporate communications ensures the exchange of communication between both the internal and external stakeholders. • Corporate communication ensures that corporations can adapt themselves to new conditions brought by a rapidly-changing environment and rules of competition. • Corporate communications ensures that functions such as planning, coordination, decision making, motivation and supervision can take place. • Corporate communications ensures that the hierarchical structure is set up and that the messages, documents, information and records are exchanged within this structure. • Corporate communications ensures that the small groups consisting of corporate employees have a healthy relationship between one another and with the corporation. • Corporate communications ensures the unity of a corporation and the development of a feeling of belonging amongst its employees. • Corporate communications ensures that there is mutual trust and the free flow of information within a corporation. It ensures that clients’ needs are met externally.
The Importance of Corporate Communications
Just like the nervous system that reaches every corner of a living organism, communication reaches all areas of a corporation and plays the role of a binding and unifying force.
Active communication in companies is important for two reasons: Firstly, management planning, organisation, directing, and control functions can be carried out successfully thanks to communication. Secondly, communication is a management activity that managers spend a lot of time on in order to ensure coordination.
Active communication in companies is important for two reasons: Firstly, management planning, organisation, directing, and control functions can be carried out successfully thanks to communication. Secondly, communication is a management activity that managers spend a lot of time on in order to ensure coordination.
Corporate communications is the systematic implementation of all communication measures in a
unified manner to affect the corporate climate for the institution, corporation, foundation or organization.
Characteristics of Corporate Communications
The characteristics of corporate communications in relation to the topics and concepts it covers can be found below:
• Corporate communications is aimed at corporate audience. • Corporate communications covers all communication that is used to form a relationship with stakeholders. • Corporate communications is symbolic and purposeful. • Corporate communications takes place within a complex and open system. • Corporate communications covers all messages that can be found in formal and informal communications channels. • Corporate communications deems and evaluates all communication that takes place within the corporation as a whole. • Corporate communications as an ongoing process has a long-term perspective. • Corporate communications entails the creation and sharing of messages about the ideas, goals and concepts in order to ensure that employees can make sense of their surroundings and can overcome uncertainties. • Corporate communications includes the communication that originates from the attitudes of employees; their emotions, relationships, satisfaction, personality and talent.
Perspectives on Corporate Communications
When the approaches regarding Corporate Communication are examined, we see four basic approaches. These are the Classical Management Approach, Human Relations Approach, Human Resources Approach and System Approach.
Classical Management Approach
Classical management approach sees corporations as a mechanism (machine). Classical management focuses on the determination of the corporation’s formal structure. The cornerstones of the approach are composed of principles such as division of labour and specialisation, compartmentalisation, unity of chain of command, hierarchical structures, space of control, unity of corporate goals, balance of power and responsibility and delegation of authority which are constantly emphasized as factors that increase productivity.
Human Relations Approach
Human relations approach focuses on the effect of giving importance to employees, keeping them satisfied and keeping their morale high on productivity. Its main area of
interest is incentivising for work in order to achieve productivity.
According to this approach, a goal can be attained through people and the cooperation of people, participation, personal satisfaction and interpersonal skills are important. Since the corporation is a social system, it is expressed that the most important element in that system is the individual.
Human Resources Approach
Human resources approach has a team-oriented and participating approach to the employee and management relationship. The employees are expected to play an active role in all corporate decisions. According to this approach, in order to enable creative thinking and correct decision making, information and feedback need to be freely exchanged.
The corporation needs to align its structural needs with practices that will keep its employees satisfied. There is an emphasis on absolute participation on every level of the corporate hierarchy. The happiness and satisfaction of employees are anticipated.
Systems Approach
In the systems approach, communication is given great importance as it is a process that bonds the elements of the corporation together as a system, and ensures their alignment. It is expressed that communication would be sufficient to create an organised information flow between the superior-subordinate, in both formal and informal setting.
Communication is the main tool for creating a common perspective and understanding. All communication and feedback used to create and protect corporate culture are deemed important. One of the topics, which is constantly emphasized, is that a productive and effective management structure can only be built with a communication system, and that can only be ensured by multi-directional communication and interaction.
Structure of Corporate Communications
Corporate communications is the kind of communication that exists within the corporation, that is done by and that is about the corporation, and it includes all kinds of communication that involve the corporation.
In all corporations, communication takes place horizontally and vertically, internally and externally, formally and informally; between employees, various levels of management and external resources (Riel and Fombrun, 2007: 13).
Relationships with internal and external environment constitute the whole of corporate process. The flow of corporate communications should be observed and assessed within the integrity of the process.
Corporate Communications Network Models
A communications network is a message flow that follows communication from start to finish (DuBrin, 2012: 441). Structurally, corporate communications can be of formal and informal nature. Formal communication is done according to corporate rules. In this type of communication, the personalities of employees are removed from the process and it takes places among the ranks. Informal communication is interpersonal and takes place within and between informal groups created by employees (Gürgen, 1997: 63). Corporate communication models are structures that determine who will communicate with whom within a corporation.
Five different communication models that are widely used in corporations can be found below:
• Central Model • Y Model • Chain Model • Circular Model • Free-flow Model
Central model is used by organisations with an authoritarian understanding of management where there is a clear-cut line boundary between the superior and the subordinate.
In Y model, there is a high level of centralisation. The ranks of communication consist of a “Y” model at the beginning or at the end. There is a little communication network in the Y model, and the hierarchy is essential. This hierarchy is reflected in departments, the people in the departments, their conversations, attitudes, behavior and attire.
Chain model is the type of communication formed through messages that will pass from person to person within a group. In the chain model, communication is processed according to the proximity of the members. Hence, some members of the group may be isolated.
Circular model is a democratic model of communication which is mostly established in informal groups and among people of equal ranks. The group does not have a specific leader. Any individual can begin communication.
Free-flow model is relatively more democratic and in this model, any individual can begin communication or anyone can communicate with one another. The most important characteristic of this model is that communication is established within the source and the receiver directly. There is no different department stepping in, no loss of meaning and waste of time.
Formal Communication Networks
Formal communication involves all official memos, directives and types of reporting. The goal of formal communications is to ensure that there is a flow of information and understanding that is needed by the group, that the employees are satisfied with their jobs, to
create the desired attitudes and to convey information to relevant parties when needed.
The flow of information is structured according to this hierarchy. Communication that takes places between individuals of different ranks is usually very rigid and functional and is usually limited to the transmission of orders.
Formal communication networks are generally reviewed under three categories, namely vertical, horizontal and diagonal.
Vertical Communication Networks: is the communication network that ensures the flow of commands and information within the corporation’s hierarchical order. Vertical networks work from top to bottom, bidirectionally.
Horizontal Communication Networks: Horizontal communication is described as the communication taking place among the employees whose rank is close to one another. It is the kind of communication that takes place between people who are of equal status in the hierarchy.
Diagonal communication networks: It is the communication carried out by and within departments of different levels and positions without using the hierarchical networks. Diagonal communication is the transmitting of a message to a different department that is at a lower or a higher level.
Informal Communication Networks
Informal communication stems from the natural relationships between people. This kind of communication is not pre-organised nor is it formally established. It includes unofficial hearsay, gossip and intentionally spread news. This system of communication between the members of the corporation, which is not bound by the formal regulations, occur as a result of personal relationships and interactions within the members of the corporation.
Internal Communication
In order to achieve corporate goals, it is very important that they are correctly communicated to the employees. Communication is the most important tool that facilitates the sharing of information, feelings and thoughts between the employees and departments of a corporation. Internal communication is described as the planned use of communication activities; the sending and receiving of messages about events and people within corporate boundaries to share corporate goals in order to systematically affect the knowledge, attitude and behaviour of employees.
External Communication
It is not sufficient just to set up a communication organisation within the corporation. Corporations can only become successful if they complement their internal communication relations with external communication
relations. External communication is the type of communication that takes place with the customers and target audience, with which the official corporate structure is directly linked.
External communication which is the exchange of messages between the corporation and its surrounding covers the areas of marketing, public relations, sales calls, press releases, speeches and the interaction with other corporations.
Managerial Communication
Managerial communication is described as the constant exchange of information within or the surrounding of the corporation in order to carry out basic management functions such as planning, organisation, directing, coordination and supervision that is needed to be carried out in order to reach objectives.
Managerial communication facilitates corporate activities, supports its vision and corporate goals, and is used in all managerial operations from customer operations to employee training.
Corporate Culture and Corporate Identity
Identity is the total sum of all characteristics that helps determine a specific object and distinguishes it from things that are similar to it. On the other hand, corporate culture is the sum of values shared by the members of the corporation.
Corporate Culture
Corporate culture is important given that it affects and determines the individual’s behaviour -hence their communication- within the corporation. There are many studies concerning the issues concerning what the corporate culture means and how it is defined, in addition to how it is measured and how it can be changed. Corporate culture plays a crucial role in ensuring that there is effective and productive internal communication. Each corporation has a culture. Corporate culture is the totality of values shared by the members of the corporation.
Corporate culture has many functions inside and outside of the corporation. The success of corporations that could not create their own culture is merely coincidental. A brand provides us with a service or a product after a long process that extends from production to supply, and there are certain foundations that cannot be directly observed by the consumer which sustain it. Just like beams and girders that enable a building to stand upright, the corporate culture is perceived as the element that sustains an organization.
Different types of corporate culture gives the corporation an identity and value, thus distinguishing it from others. In other words, the researchers who are interested in the corporate culture have created different classifications in accordance with the content of the culture, its strength and type of management, and they have talked about the
existence of corporate culture types: Power culture, role culture, task culture and personal culture.
Corporate Identity
Corporate identity is a corporation’s signature All corporations and organisations found in a society have their own identity. If a business wants to stand out, it needs to create a corporate identity. Corporate identity is seen as the process where a corporation presents and explains itself, and it is more about presenting the corporation rather than its products and services.
Corporate identity is not limited to visual aspects pertaining to the corporation. It also includes the communication of aspects that create the corporation’s identity by using specific communication channels.
It is a resource to create reliability and it is approached as the support that takes place between different interest groups and new business environments in order to gain competitive advantage. Corporate identity includes the corporation’s verbal and visual publicity, market positioning, and competitive differentiation at a corporate, commercial entity and product level.
Corporate Communications Strategies
Corporate communications is a critical tool to ensure that corporateness creates a strategic advantage. Corporate communications that manages all communication activities concerning the corporation, aims to contribute to the corporate reputation by creating long-term compatibility, understanding and cooperation with internal and external audiences.
Corporate communications is related to the process that ensures that a product is successfully produced and that the perception of the target audience is sustained in the long run, and evaluated by the corporation for the corporation’s strategies.
It is believed that the following effects strategic corporate communications directly (Vural and Bat, 2013: 44).
• Measuring the perception of various groups through research • Using those perceptions in order to develop the messages that are going to be sent out to different groups • Creating a rich perception for different customers who want speed and precision • Managing the communication messages through preventive measures in order to influence views and news concerning various corporate values.
A corporation’s communications strategy is actually made up of four phases. Corporations that can successfully carry out these phases can reach their corporate goals more easily. These phases are as follows:
• Strategic Analysis Phase • Strategic Intent Phase
• Strategic Action Phase • Tracking and Evaluation Phase
Corporate Communications Tools
Corporate communications tools are used to establish formal communication in corporations and these tools have become a necessity to ensure that the corporate activities can be carried out effectively and productively. The selection and the use of corporate communications tools should have certain standards. Communication tools should be able to convey messages fully and comprehensively without changing its form or essence, and they should be able to catch the attention of the target audience.
Traditional Communication
Traditional communication tools are evaluated under three groups, namely, verbal, written and audio-visual.
Verbal communication tools enable a message to be relayed with words. Face-to-face meetings, phone calls, organisations such as seminars and meetings, and announcements are verbal communication tools used in corporations.
Written communication, which comprises most of the managerial activities, is the most widely used communication tool by the corporations due to the fact that messages can be checked at a later time and they become judicial documents. Magazines, newspapers, bulletins, brochures and booklets published by corporations are important written communication tools.
Audio-visual tools are the kind of media where sounds and images are electronically transmitted. Cinema, radio, television and other types of visual text presentation can be evaluated in this framework. Audio-visual messages do not have a long duration. They affect an individual’s emotions for a few seconds, and then they vanish. These types of tools use entertainment, drama, and emotion to attract attention and try to speak to the audience’s emotions.
Web-based Communication
At the beginning of the 2000s, almost all corporations started preparing a web site that they used as a tool to present themselves and started to establish their place in the online world. Developments in this area have profoundly affected the media, and the concept of media that used to mean “communication environment and tools” has branched into two as “traditional media” and “new media”. Television, radio, newspapers and magazines are a part of traditional media. Social networks, blogs, photo and video sharing sites that developed with internet technology are a part of new media.
The new communication medium has been defined as “new media” because it has a unique structure and also includes traditional mass media. New media includes all web-based production, distribution and communication. It
is an abstract notion that characterises the internet’s environment of interaction, and the tools that use this power are described as “social media.”
New media is a general term used for tools and web sites that were created with the web 2.0 technology. These tools create opportunities for users to share information, thoughts, interests and enable interaction. Thanks to social media providers, users can share content, personal information, ideas, thoughts, points of view, feelings and perception, and they can also use these tools for interaction and conversion.
New media management enables corporations to;
• Increase their visibility and recognition, • Support customer relations, • Provide interaction with the target audience, • Enable for becoming distinctive among other corporations, • Help increase prestige.