Partners
Categories
Communicating Strategic Change? Get Sensitive.
A key question in managing strategic change is how best to communicate that change to external stakeholders. It may sound straightforward but organizations often struggle to get their message across and often it’s not for the want of trying. As one business journalist commented, “The front pages of newspapers have recently been full of stories of companies run by smart, savvy people doing and saying seemingly stupid things.”1 Getting internal communication processes right has become a top priority for manages and consultants engaged in change process, but strategic change often means a significant shift in a company’s orientation to external stakeholders, which means getting the message right for them is equally important.
A recent study by Peer C. Fiss and Edward J. Zajac2 suggests that communicating the nature of strategic change might best be done sensitively rather than boldly. Fiss and Zajac looked at strategic change in German corporations moving toward a shareholder-focused value orientation. Unlike US and Canadian firms, German businesses have traditionally attempted to more equally balance the interests of management, employees and shareholders. So, moving to a focus on shareholder value as the primary objective has been a major shift for many German firms, and a highly controversial one!
Fiss and Zajac examined two potential communication strategies followed by German firms that would make this strategic change either bold - an “explicit espousal of a shareholder value orientation without qualification or alteration”; or sensitive - a “balancing” approach, that communicated a new adherence to “shareholder value management, but qualified this statement by simultaneously affirming the legitimacy of other stakeholder groups”.
The balancing strategy paid off – the firms that communicated a balanced sensitive approach enjoyed significantly higher stock evaluations. Fiss and Zajac argue that this is because those firms were able to manage the reputation of their firms in a way consistent with the still dominant cultural norms of German business. More surprising is the finding that the balancing approach was associated with a greater degree of actual implementation of shareholder value strategies inside the firm. In other words, a sensitive communication strategy proved to be more than skin-deep and delivered changes in organizational practice. In contrast, firms that had adopted the unqualified approach to stakeholder communication had in fact changed less than those that had worked to connect their changes to traditional stakeholder concerns.
So, it seems that sensitively communicating the nature of a controversial strategic change might avoid your message being misconstrued, undermined or back-firing. It offers the possibility of dual benefits - implementing change more fully and being rewarded for it financially. The alternative may be to go boldly – nowhere!
1. Greg Schneiders, PRweek, New York, July 24th 2006
2. Peer C. Fiss and Edward J. Zajac. 2006. The symbolic management of strategic change: Sensegiving via framing and decoupling. Academy of Management Journal, 49(6): 1173-1193.
Comments
Leave a Reply
Featured
Change Post-its: Cultural Intelligence & Change
Change Post-its are ideas we come across as we scan the internet and other sources for new ideas that... read more →
Communicating Strategic Change? Get Sensitive.
A key question in managing strategic change is how best to communicate that change to external stakeholders. It may... read more →
Our Community
Tom Lawrence, our editor, is the Weyerhaeuser Professor of Change Management at SFU.Read Tom's Posts
Graham Dover is a Doctoral student in the Business Faculty at SFU. Read Graham's Posts