As we’ve mentioned before, a company’s business strategy is a critical document that defines a company’s vision, objectives, values and business model, among other things – and effectively communicating it internally is essential.
However, communicating it externally is also critical, since it can encourage investor support, gain client interest and provide a competitive edge. After all, in today’s environment, companies are often judged by how they are perceived externally.
Communications professionals are tasked with properly communicating a company’s business strategy to external audiences. Communications, therefore, are more important than ever to modern businesses. This is especially true because of the overabundance of data that modern technology offers to everyone – from concerned investors to the mindful shopper. When purposeful external communications are not put into place, individuals will draw their own conclusions about the company, which may ultimately be detrimental to the corporate image.
Communication professionals are responsible for condensing important strategy information into key points and sharing these efficiently through the business’s public profiles. An ever more complicated task, this topic is the focus of an entire course geared toward students of the USC Master of Communication Management online program. This article uses the fundamentals of this course as a starting point to explore:
- How modern communication tools such as social media have changed the shape of external business communications.
- How business strategy influences customers’ actions in an environment where personal values often drive purchasing decisions.
- How business strategy influences reputation management activities.
- What successful companies are doing to communicate their business strategies effectively outside the company.
- Key strategies for communicating a company’s business strategy to customers, clients, stakeholders, potential partners and more.
Traditional Vs. Modern Communications Models
In decades past, communications departments existed for the primary purpose of crafting well-written content for press releases, executive speeches and major publications. These were the key touch points between business entities, stakeholders and customers. In today’s digital environment, however, companies are expected to maintain constant communication with external audiences. The occasional press release has been replaced by daily blog and social media posts. To remain competitive, businesses need to provide a steady stream of fresh content. Customers expect a quick response when they reach out, and communications teams are charged with aligning activities across multiple platforms to meet these demands.
The Value of a Strong External Business Strategy
Communicating business strategy to stakeholders and customers is crucial, since shoppers are increasingly making their choices based on a business’s reputation. An underlying corporate strategy that defines what’s truly important to the company can play a key role in generating sales or gaining investor support. For the strategy to be effective, it should align activities with goals both within the company and among customers.
As Kasper Nielsen, Executive Partner of Reputation Institute puts it, “In today’s world, the Chief Communications Officer is expected to implement a structured process for 24/7 brand and reputation management for all stakeholders, across all channels and across all markets.” The internet puts a wealth of information at the customer’s fingertips, much of it uncontrollable. In 2017, 97 percent of consumers used the internet to find local businesses. It’s crucial for communications professionals to have a firm grasp of what potential customers will find when they take this route.
When a business strategy is communicated effectively and shared efficiently across multiple platforms, this information becomes readily accessible to consumers who are looking for businesses that align with their values. Thirty percent of customers make purchases that are driven by their personal beliefs. This is even truer of young shoppers. Among millennials, 60 percent are belief-driven buyers, as are 53 percent of those in Gen Z and 51 percent of individuals in Gen X. If a company’s business strategy effectively outlines the business’s core beliefs on critical issues, this could drive sales significantly and foster deep connections with customers.
Key Considerations for Communications Professionals
Nielsen emphasizes the importance of the Chief Communication Officer’s role in business strategy communications, stating that only about 20 percent of COOs are currently equipped to deliver on the expectations that they face in today’s marketplace. He states that “Reputation management is the bridge that connects communications with the business strategy.” Understanding the core elements of reputation management, then, is at the heart of effective external communications in this area.
Reputation management often means monitoring, contributing to and responding to interactions on social networks. Proactive, transparent reputation management means responding appropriately to customer feedback and putting positive information out that will support the company’s image.
How does this tie in to business strategy? A company’s business strategy defines what’s important to the company in clear, concise terms. This will, in turn, define how external communications are handled. Harley Davidson’s business strategy includes inspiring two million new riders in the United States, launching 100 new high-impact H-D motorcycles, and growing the business without increasing its environmental impact. The company opts for a much more personal approach, communicating its values at specially hosted events and spending just 15 percent of its marketing budget on traditional media.
In other industries, communicating business strategy is achieved primarily through advertising campaigns. McDonalds’ business strategy includes goals such as retaining customers by focusing on breakfast, regaining lost customers by improving the taste of food, and converting casual customers with coffee and snacks. To this end, the brand focuses its efforts on reaching customers through mass media.
How to Effectively Communicate Business Strategy Externally
When strategic changes are made within the business, the communications team should immediately take action to make sure these are shared in the appropriate manner with key individuals outside the company. While press releases continue to be an efficient tool for sharing certain announcements, they’re not always the ideal means of sharing information with the public.
Social media is a key communication channel and a crucial method of dissemination for strategic business goals and insights because it is not only unparalleled in its visibility but also heavily relationship based. After all, in today’s world, many people buy products and make investments based on a company’s reputation – and social media can have a huge impact on that.
Individual approaches will always vary, but in general, communications professionals should follow these guidelines for effectively communicating a business strategy externally:
- Promote the business strategy as a key part of the company’s overall marketing strategy.
- Develop promotional graphics that highlight the core tenets of the company’s strategy.
- Share updates to the business strategy via press releases and blog posts.
- Promote strategy updates on social sites such as Twitter and Facebook.
- Respond to social comments with information that furthers the public’s knowledge of the company’s business strategy.
- Design all marketing communications to implement a style and voice in line with the company’s strategy.
As T. Michael Glen, the Vice President of FedEx Services puts it, “Communication is the center of everything. You can’t execute strategy if you can’t communicate about it.”
Communications and Business Strategy Are Intertwined
A company’s underlying strategy will drive communications and determine the points that get the greatest emphasis in everything from press releases to tweets.
When the company’s business strategy is in line with the interests, goals and concerns of shareholders, shoppers, and others, a strong communication plan can become one of the business’s most valuable assets for gaining new customers, satisfying stakeholders and even developing profitable business partnerships. Communications professionals need a well-rounded understanding of the importance of business strategy as well as how to best share it with others. With this in hand, communications professionals can vault their careers to new levels of success with smart strategies.
The online Master of Communication Management degree from USC Annenberg addresses the importance of external business strategy communications and other issues central to modern communications theory, incorporating coursework on marketing, strategic corporate communication and other key topics.