Tuesday, January 9, 2007

The Corporate Diplomat

Corporate India & the news cycle

ND Batra
From The Statesman

The news media, including the Internet, has begun to play a significant role in the conduct of international business. Television news is converging with the Internet, making events live and spontaneous beyond anyone’s control. The rise of bloggers, online anonymous whistleblowers and other public interest groups who present alternative views of what companies are doing is another serious challenge.

Gone are the days when a business could be conducted beyond the public view. The heightened interest in companies is due to the impact on people’s lives, even if they are not directly invested. The very presence of Posco or Arcelor-Mittal in a poor state like Orissa raises fears and expectations, hence the intense scrutiny by the news media.

The news media in democratic countries have a privileged position regarding freedom of speech. In the USA, it is difficult to win libel damages against the news media because of the legal provision called “actual malice”, or “reckless disregard for truth”, as defined by the US Supreme Court. The burden of proof in defamation cases involving the media lies on the plaintiff, for example, on the company that sues the media. And because of the inescapable fact that our economic life, pensions, retirement savings and environment and quality of life have become dependent on the marketplace, no business can escape media attention.

The bigger the company, the more intense would be the scrutiny by the news media about its activities. Add to it millions of blogs that feed upon each other. But how should global companies deal with unconstrained global news media especially when for professional and competitive reasons bad news makes a good story? Companies have to become media savvy, understand how news media organisations work, how they produce stories and their reporting methods, and how to influence them by providing them with correct and timely information.

Companies have been using adverting as a major method of persuasion, which is still a powerful mode of direct communications with stockholders. But advertisement cannot beat headline news, breaking stories, or special reports with which the news media try to draw the public attention distracted by the infoglut. It is a big challenge for companies to be heard in an environment of always-on news media and the Internet.

Accounting scandals, obscene pay packages, golden severance parachutes, and personal misconduct of some CEOs have created an air of diffused distrust in the global corporate. Nevertheless, companies must learn how to create good media relations. Let’s keep in mind that no news media outlet or a reporter would turn a bad story into a good one, especially in the time of crisis. News is a competitive business and no one can afford to keep silent over a story that impacts the public. In good times, a company that has excellent working relations with the news media can strengthen its reputation by presenting positive stories and thus enhance its reservoir of public goodwill.

Consequently, when a crisis hits a company, the company could draw upon the public goodwill. The traditional method of issuing Press and video releases is still relevant, especially in the local news media outlet, where the paucity of resources might prompt a local television station or a newspaper to repackage a company’s story as news.But national news media organisations are inundated with e-mail news tips, and video and Press releases; consequently they hardly pay attention to the daily junk mail. It is important to know the right people in the news media. It is equally important for companies to pay heed to the Global Research Development Center guidelines on dealing with the news media in a productive way.When the news media come calling for information and comments, the company should offer full cooperation and the spokesperson should be ready with facts; or promise to provide the data promptly to meet the reporter’s deadline.

Whatever information is provided, it should be done thoughtfully and judiciously. It is difficult to undo or correct the information once it is out. Providing reliable and prompt information is one of the best ways to build bridges with the news media. Media interviews should be approached with great preparation and caution. Especially in a crisis situation, the interview need to be handled with great care and circumspection, and as much information should be given as it is necessary. There should be no room for misinterpretation. In other situations, for example, in the case of a new product being launched or a new business policy being implemented, the company CEO or the spokesperson should be able to answer the reporter’s question succinctly in a memorable way. This is the age of brevity and sound bites.

The ability to communicate comprehensively in a few words is a great asset, which a company spokesperson needs to develop. Another point to be kept in mind is that a television interview is different from a print media interview. For a television interview, the company’s CEO or the spokesperson, must do a few practice sessions with experienced experts in media relations before he appears before the television camera.

Television can be very unforgiving if one is unprepared. Handled properly, a television interview enables a company to reach millions of viewers without cost.A media smart company would look at the news media as a most important stakeholder and build good relations on which it could count upon in case of a crisis. It is a difficult task to accomplish because the news media’s interests do not necessarily converge with those of a company.

Keeping ongoing socials relations with important personnel in the news media such as publishers, editors, and various important reporters can be helpful to the company.

Top corporate leadership must incorporate the news media into their strategic planning.

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