The Strategic Communication Imperative

The link between strategy and its implementation has always been tenuous. Top consulting companies have employed countless MBAs to develop strategy for their clients. Academics at top business schools have spent their careers developing frameworks explaining how to develop better strategies for top companies. However, only a handful of academics and a cadre of tactical consultants, primarily at public relations companies, have struggled with strategy implementation in the area where it matters most: its communication to a set of varied constituents.

Many companies take a tactical, short-term approach to communicating with key constituencies, which is not only nonstrategic but may be inconsistent with the corporate strategy or even impede it. Exxon Corp.’s decision in 1989 to remain silent for days after the Exxon Valdez ran aground in Alaska’s Prince William Sound, AT&T Corp.’s decision to permanently lay off 40,000 employees on the first business day of 1996, a CFO’s decision to avoid notifying senior managers about a downgrade of the company’s stock by a major investment bank and, more recently, Merck & Co. Inc.’s decision to wait until pressured to pull Vioxx, its arthritis and acute pain medication, from the market are all examples of communications being used tactically as part of a short-term legal or financial orientation. However, the dearth of both academic and practitioner emphasis on the strategic nature of communications, coupled with recent legal and regulatory responses to corporate scandals (such as enactment of Regulation Fair Disclosure and the Sarbanes-Oxley Act of 2002), has created a strategic communication imperative — an increasingly urgent need for executives to ensure that their communications practices contribute directly to corporate strategy implementation.

We define strategic communication as communication aligned with the company’s overall strategy, to enhance its strategic positioning. (See “The Framework for Strategic Communication.”) Over the past year, we conducted primary research into strategic communication, conducting more than 50 interviews with CEOs, CFOs, heads of corporate communications and investor relations, and others from a dozen companies representing different industries, market capitalizations and approaches to organizing their communications efforts. To research the concept that strategic communication is inextricably linked to corporate strategy, we asked these executives about their communications strategies and tactics. The research not only indicates the drivers, best practices and lessons of strategic communication, but it also suggests that when companies take a strategic approach to communication, communication becomes integral to the formulation and implementation of strategy.