Monday, January 28, 2008

Rise of corporate communications executive

A study released today identifies a strong correlation between a company’s corporate communications organization and the company’s ranking on Fortune magazine’s “World’s Most Admired Companies” list. Specifically, the study finds that the professional background, communications priorities, and inter-organizational relationships of the executive who leads the company’s corporate communications department – commonly referred to as the Chief Communications Officer (CCO) – are all meaningful indicators of the ability of a corporate communications organization to make a positive impact on a company’s reputation.

The survey, ‘The Rising CCO’, compares responses from communications officers in the “world’s most admired companies” with those in “contender companies” (generally, most admired companies are the most highly ranked companies in an industry on overall reputation; contender companies are ranked in the industry’s bottom half). The 141 survey participants were top corporate communications executives from Fortune 500 companies in the U.S. and Europe.

The survey, which was conducted by global executive search firm Spencer Stuart and global public relations firm Weber Shandwick with KRC Research, examines the changing role of today’s CCO.

“In a fast-paced and dynamic business environment, communications officers are increasingly seen as a business partner for the CEO and leadership team in the stewardship of a company’s reputation,” said George Jamison, Corporate Communications Practice Leader at Spencer Stuart. “CCOs are expected to create value and mitigate risks for the corporation by developing innovative strategies to proactively communicate with a company’s myriad stakeholders.”

The research found that communications executives in the world’s most highly regarded companies have more prominent organizational status and longer tenures than their counterparts in contender companies. Additionally, approximately one-third of CCOs from the most admired companies cite corporate reputation as their number one priority for 2008, compared to fewer than one-quarter of CCOs from contender companies (34 vs. 21 percent, respectively). Contender company communications executives said they were spending more time working on product-related issues and crisis communications, while most admired CCOs said they spent more time on corporate social responsibility and building corporate reputation.

“Our research identifies how the corporate communications function can be a critical force in driving a company’s reputation in good times and bad,” said Dr. Leslie Gaines-Ross, Chief Reputation Strategist at Weber Shandwick and leading corporate and CEO reputation expert. “With the right organizational structure and partnership at the top, the best CCOs can significantly contribute to building shareholder value and corporate reputation.”

Other key findings are:

CCOs’ responsibilities will increasingly shift from tactical to strategic. While CCOs are carving out their role as strategic partners at the highest levels of business, they view work today as predominately tactical (58 percent tactical, 42 percent strategic). This imbalance, as reported by those surveyed, is sure to change as focus shifts from financial communications, media relations and internal communications to the broader strategic issues of environmental/ social responsibility and corporate reputation. The tools used to perform their jobs will expand as well, with blogging/social media and corporate Web sites becoming increasingly important.

CCOs hold prominent positions at the world’s largest companies. Nearly one-half surveyed report directly to the chief executive officer (48 percent) and are visible to their boards (had a median seven interactions with their board during the past year).

CCOs and CMOs are friends and rivals. CCOs’ dynamic relationship with chief marketing officers (CMOs) – often a main rival and ally – reflects the growing influence of communications in today’s marketing mix.

Measurement of CCO effectiveness is predominately qualitative. The vast majority of those surveyed report being measured on qualitative measures such as “positive” media coverage (75 percent) and CEOs’ “gut” feel (73 percent). They are least likely to be measured by quantitative metrics such as the number of media mentions (35 percent) and ability to control costs (32 percent).

2 Comments:

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