the outcomes of ‘Orange on the Inside’ or the Renaissance pro- ject in Denmark and elsewhere. Strategy and communications as a narrative of change The other way of analysing this case is to see it as a compelling, novel and credible strategic narrative for change. This approach 264 Corporate Reputations, Branding and People Management Table 8.1 Changing corporate communications. Traditional corporate 21st century corporate communications communications Basis and direction Everything is outbound, Dialogue and interactivity of communication reflecting needs of among stakeholders corporation Channels Specialist people and Focus on ‘customer’ departments using a needs and integration plan–develop–implement of functions using a sense– model adapt–respond model Focus of communications Need to address Need to address global national markets markets Content of communications Focus on how well Focus on how well corporation is corporation is employing employing tangible intangible assets, e.g. assets, e.g. finance, values, brands, people, plant etc. knowledge, CSR Basis of differentiation Products and services Customer value or unique selling propositions customer captivity Structural drivers Communications Communications reflect reflect corporate alliances, partners and monolith context Importance of Corporate Corporate communications communications as communications as a optional core strategic driver Importance of Corporate brand as Corporate brand as a corporate message optional key strategic aim Source: Based on Schultz and Kitchen, 2004 to corporate communications is based on the so-called post- modern or ‘linguistic turn’ in management studies during the 1990s; a turn helped by companies such as GE, whose reported dissatisfaction with planning and hard analysis in strategic man- agement was well documented during the 1980s. Instead, num- bers and positioning gave way to ‘strategy as perspective’. This involved looking into the heads of strategists, their values and aspirations, for the ‘vision thing’ and the search for the ‘organi- zation’s soul’ (Mintzberg et al., 2004). More of this in the final two chapters; the point to note for now is that this turn has cer- tainly added to our understanding of the links between HR, cor- porate reputations and branding. Strategy as perspective, or as we prefer to call it, ‘strategy as communications’, is basically con- cerned with strategists telling and selling a compelling, novel and credible story to different audiences (Barry and Elmes, 1997). If you reflect on your organization’s public pronouncements, these are the essential qualities and functions of all good vision, values and mission statements; they are also essential elements of how effective and ethical leadership relates to followership, and to the change processes underpinning reputation and brand- building (see Chapter 9). Such stories have to be new or refreshed to inspire followers; they have to incorporate a compelling, aspirational view of the future; and they also have to be credible in relation to the history and context of the organization, and the lived experience of employees (Boje, 2006). Successful change management also incorporates these qualities: we can think of few cases where these were not part of what effective leaders did in ‘theorizing the need for change’ through aspira- tional and credible stories (Martin and Beaumont, 2001), as we shall see later in this chapter. The Orange experience in Denmark embodies all of the elements of a successful narrative for change, which could have formed a leitmotif for how they approached the Mobilix acquisition. In the field of reputation management, Cees Van Reil (2003), who works with Charles Fombrun at the Reputation Institute, is the writer most associated with this perspective. He has described corporate communications as the ‘orchestration of all the instru- ments in the field of organizational identity (communications, symbols and the behavior of organization’s members) in such an attractive and realistic manner as to create or maintain a Chapter 8 Corporate communications and the employment relationship 265 positive reputation for groups with which the organization has a dependent relationship’ (p. 163). Such communications, as he points out, can be of three types: ■ Management communication, which focuses on how leadership communicates externally and internally, and how they bring about a positive communications climate ■ Marketing communication, which focuses on advertis- ing, personal sales, sponsorship, direct mail, sales sup- port, etc., and ■ Organizational communication, including public rela- tions, investor relations, environmental communica- tion, corporate advertising and internal employee communications. For Van Riel, the critical points are that all such types need to be coordinated to create positive reputations in the sense that they need to have a common starting point, but, most import- antly, they need to be based on a sustainable corporate story (SCS). The idea of an SCS is an interesting one which we have incorporated into our model in Figure 8.1. The four key cri- teria against which an SCS should be judged reflect the narra- tive perspective on strategy. These are as follows: 1 Realism: all stakeholders see it as typical of their organ- ization as a whole and as differentiating it from others 2 Relevance, to all members’ interests 3 Responsiveness: the style of narrative and communica- tions should be part of an ongoing, dynamic conversa- tion between internal and external stakeholders, and 4 Sustainability: reconciling the competing demands of stakeholders and organizational members over time. Sustainability, however, is difficult to achieve in practice. Research in this field has shown that stories that adopt a ‘single voice’, even one that has ‘buy in’ from the majority of employees, quickly become the object of less flattering narratives and the object of a dynamic process of refinement (Bjoe, 2006). This dynamic nature of sustainability needs to be taken into account by HR and communications specialists, a point to which we shall return later in this chapter. 266 Corporate Reputations, Branding and People Management Change as communications narrative As we noted in the introduction to this chapter, we developed a model of strategic change, based on extensive research into the problems of change and change agents in multinational organ- izations (Martin and Beaumont, 2001). This earlier model, drawing on communications narratives and the idea of strategy as a perspective, can be adapted to incorporate the ideas of Van Riel and some of the consulting work in this field to provide a new, comprehensive framework for ‘strategic change through communications’ (see Figure 8.1). The initial model set out the relationships between a complex set of events, activities, lan- guage practices, emotions and reactions that help explain two key questions in change management: ■ What is needed for sustainable strategic HR change to occur in organizations? and ■ Why is it that most strategic HR change initiatives are rarely successful in creating sustainable change in organizations? Sustainable change has been defined as when new ways of working and the attainment of improved outcomes become the norm in organizations (Buchanan et al., 2005). Mirroring Van Reil’s SCS, the value of this model lay in seeing strategy as a convincing narrative or storyline that managers and employees often co-construct, ‘buy into’ and use to give a sense of mission and purpose to their organizational lives. The notion of stra- tegic discourses and change conversations plays a major part in the model (see Box 8.2) and helps flesh out the idea of sustain- able corporate stories. Chapter 8 Corporate communications and the employment relationship 267 Box 8.2 Strategic discourses and change conversations A strategic discourse is a set of communicative practices that are closely linked to specific purposes of powerful groups. Discursive practices in management include strategic conversations that managers use to promote change. Four types of strategic conversations have been One of the advantages of this framework over most of the com- munications approaches lies in locating the processes of change through communications in receptive contexts. The model sets out four stages in the strategic change process – conception, tran- sition, embedding and feedback – in four levels of context for change. In the case of Orange, for example, the social context, which refers to the social distances between the cultures and insti- tutions of the parent country and its subsidiaries (see Chapter 7), would be important in understanding the transfer of a ‘global’ Orange culture to countries such as Denmark. The key features and stages of the model are as follows: 1 Receptive contexts for change. These contexts are espe- cially important for successful HR change to become embedded in complex organizations. We can identify four such levels of context: the social, the outer-organi- zational, the inner-organizational and the relational context. The social context we have already described as 268 Corporate Reputations, Branding and People Management identified that good leaders and managers use in promoting their change initiatives: ■ Initiating conversations that are used to get the change process under way, which include assertions, directives, promises, etc. that engage employees and outline what is needed. ■ Understanding conversations to test the reality of the change propositions and to generate involvement. These conversations focus on claims, evidence, ‘theories’ of cause and effect (if we do this, we shall achieve this …) to help employees understand what is needed and what will result for the organization and for them. ■ Performance conversations, used to generate action, which focus on conversations, promises and directives that are intended to pro- duce results. ■ Closure conversations, which are assertions and declarations used to signify the successful (or unsuccessful) completion and ‘celebra- tion’ of the change process. Source: Based on Ford and Ford, 1995 Contexts CONCEPTION STAGE (Conception of need for change in reputation/brand image and new implementation approach) TRANSITION STAGE EMBEDDING STAGE (Emergence of positive reputation/brand image) Corporate adoption and diffusion of new programme/process of change Process seen as containing a novel, compelling and credible message by middle managers Brand messages/EVPs become more widely shared among segments of workforce Durable penetration of brand messages/EVPs. High levels of brand equity as measured by psychological contracts, engagement etc. Effective ‘theorizing’ by brand champion(s) and middle level ‘converts’ using understanding and performance conversations Positive internal monitoring/reading of the story by middle level managers Early positive outcomes Resistance diminishes Employee segment advocacy through closure conversations Stages and time frames in the change process Effective ‘theorizing’ by HQ and/or subsidiary champion(s) drawing on successful initiating and understanding conversations A SUSTAINABLE CORPORATE STORY SOCIAL CONTEXTS Institutional/cultural distance between parent and subsidiary, e.g. Laws and financial system, culture, education, labour markets etc. ORGANIZATIONAL CONTEXT Culture/organizational identity of subsidiary company Attitudes of employees and managers to learning and change Compatibility of practices with parent RELATIONAL CONTEXT Attitudes of corporate HQ managers to subsidiary managers/employees Dependence of subsidiary on HQ for resources/brand INDUSTRY CONTEXT Industry and market environment of HQ and subsidiaries Figure 8.1 Strategic change-through-communications in multinational/division organizations (based on Mar tin and Beaumont, 2003). having an important influence on the process of strate- gic change. However, the nature of the industry in a par- ticular locality or country and its environment is also potentially important. For example, the relatively youth- ful and high-tech nature of the global mobile telecom- munications industry, other things being equal, was more likely to help the development of a global Orange culture than traditional telecommunications. This industry has been dominated by major national players, such as BT and France Telecom, which may have had a tendency towards ethnocentricity in the past. The inner- organizational context, which in a multinational envi- ronment refers to the differences in organizational cultures, attitudes to learning, change and compatibility of practices between corporate headquarters and its subsidiaries, can have a great bearing on the effective- ness of change initiatives. These intra-organizational dif- ferences are potentially relevant in explaining the success or failure of corporate-wide initiatives such as branding and culture change programmes. Finally, the attitudes of local managers and their relative power in relation to the parent company or head office will shape the reception of change programmes. Orange clearly understood this issue in working to help raise the pro- file of local Danish managers and incorporate them into the change process. It is also important to note that the process aspects of the model (the various stages, patterns of events and language practices) are embedded in these changing contexts over time. This is particularly relevant in the case of Orange and the ‘Orange on the Inside’ process. For example, Orange sought to brand the changes as a dynamic, sustainable process rather than a programme with a fixed beginning and end. 2 The conception stage. This is the stage during which new strategies and new strategic HR discourses are developed. High-level corporate support, adoption and sponsorship of the change discourse and programmes are a necessary condition for further progress towards successful change, as was evident in the leadership 270 Corporate Reputations, Branding and People Management exercised by Monique Muller-Zetterstroem. However, it was not a sufficient condition. So, our process model allows for two-way development of the strategic changes, in which the ideas are just as likely to come from middle managers, HR specialists and internal/external change consultants, which was also reflected in the Orange case. This feature mirrors Van Riel’s important point about the need for a responsive, dynamic conversation between the organization and its stakeholders. 3 The transition stage. For the key messages of change to progress to the transition stage, credible and novel organizational identity changes and HRM initiatives (occurring in, and through, effective communications) have to be read positively by all levels of management, including main board, subsidiary and middle-level oper- ational managers. In a study we conducted on ABB, it was evident the managers in certain subsidiaries of one of the company’s major divisions became ‘highly skilled’ at denying the need for change, using many examples of why such changes in culture were unnec- essary and difficult to implement in their specific cir- cumstances. Chris Argyris (1993) has labelled this process of using skilled communications to deny prob- lems as skilled incompetence. This is one of the principal reasons for organizational resistance to change, because managers, often for the first time in years, are asked to question the very assumptions on which they have always operated. Goss et al. (1993) have argued that one of the main reasons for the failure of many pro- grammes of change is because employees are subject to a constant stream of unfinished managerial fads and fashions. Employees become adept at ignoring these programmes of change, most of which have little impact and regularly fail to become embedded in the organi- zation. However, incomplete programmes, often based on fads and fashions in management, result in increased levels of cynicism towards future change initiatives and to change ‘fatigue’ (Pate et al., 2000), again features of typical change programmes that Orange in Denmark sought to avoid. Chapter 8 Corporate communications and the employment relationship 271 4 The embedding stage. For the message of change to progress towards the embedding stage, in which a new strategic HR discourse of change has taken root, the communication of early positive outcomes, supported by evidence of its benefits, is necessary to overcome continued resistance; or, as is often more likely, to overcome the ‘benign neglect’ by employees that can accompany change programmes, i.e. hoping these changes will go away by ignoring them. The notion of ‘early wins’ is one of the most important and enduring in change management; it suggests that small-scale experiments and initiatives rather than wholesale, top- down programmes are the best way forward, as dis- cussed in the previous chapters. One of the few near-certainties in business is that ‘big change invokes big opposition’, so it is critical to identify the groups that you ‘trial out’. We also refer to measures of just how deeply the messages of change are embedded in an organization. Excellent examples of such ongoing measures are the state of psychological contracts over time and the extent of commitment, internalization, identification and psychological ownership of the changes, as discussed in Chapter 4. 5 The feedback stage. This stage is critical for continuous change in the organization, during which the out- comes of strategic innovations are fed back into the organizational contexts – particularly new employee attitudes and behaviours, the capacity of employees to unlearn, change and innovate, and positive attitudes towards the ways in which changes were implemented. Positive feedback is likely to set the tone for how future change initiatives will be received. In a study we con- ducted of a Scottish-based textile company (Martin et al., 1998), we noted how previously negative experi- ences with change programmes had led employees to develop strong feelings of cynicism towards senior managers and their efforts to introduce continuous changes in work practices. Such cynicism made future change initiatives almost impossible to implement. 272 Corporate Reputations, Branding and People Management Chapter 8 Corporate communications and the employment relationship 273 Using internal corporate communications to tell a sustainable corporate story to employees and potential employees In the preceding sections, we have outlined some general prin- ciples about effective corporate communications relevant to the HR, reputation management, branding process. In these next sections, let’s home in a little more closely on some of the current communications ideas that put the spotlight on employees – employer of choice initiatives and employer branding. Both of these ideas have been incorporated into our strategic change- through-communications model, to which we shall return later in this chapter. Employer of choice As we have discussed in previous chapters, the importance of talent management has increased in proportion to the numbers of people employed in knowledge-based and creative industries in the developed world. It is also likely to become critical to the economic development of countries such as China and India. For example, a McKinsey report in October 2005 forecast huge shortages of graduates in China over the coming decade, which, if not matched by an increasing supply, would hold back its progress. Consequently, companies worldwide, including some Chinese and Indian companies, have turned to employer of choice programmes to attract and retain talented people. How- ever, as we shall see, these programmes are not without their critics (Huselid et al., 2005). According to consultants such as Ahlrichs (2000) and Ashby and Pell (2001), becoming an employer of choice is a deliberate business strategy, which has driven some large, medium and small American and British employers to benchmark themselves against others in rankings such as the Best Place to Work, pub- lished by Fortune magazine in the US, and The Sunday Times list of . approach 264 Corporate Reputations, Branding and People Management Table 8.1 Changing corporate communications. Traditional corporate 21st century corporate communications. Corporate Reputations, Branding and People Management Chapter 8 Corporate communications and the employment relationship 273 Using internal corporate communications