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Bob  Pickard  Chairman,  Asia-­‐Pacific  

 Overseas  corporate  communica5ons                          for  Chinese  companies:                                              promo%ng  image  >  protec%ng  reputa%on  

China  Going  Global  Think  Tank    March  20th  2014  at  Beijing  

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Key  messages  for  today  

Corporate  communica5on  is  an  increasingly  cri5cal  management  func5on.      Communica5on  has  become  an  essen5al  compe55ve  asset  for  interna5onal  brands.  Communica5on  is  of  direct  strategic  importance  to  the  Chief  Execu5ve  Officer!  

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With  some  notable  excepGons,  few  global  Chinese  brands  

How  many  of  the  89  Chinese  companies                                                                  on  the  Fortune  500  list  are  world-­‐famous  brands?  

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GeEng  started  with  going  global  

§  Many  Chinese  companies  are  completely  unknown  outside  of  China  and  will  find  it  challenging  to  compete  in  countries  where  ‘mind  share’  will  help  them  achieve  market  share  

§  In  many  cases,  their  corporate  communicaGons  efforts  have  been  so  ‘local’  in  orientaGon,  they  are  simply  not  yet  equipped  with  the  tools  they  will  need  to  build  an  image  –  or  the  defences  required  to  defend  their  reputaGon  

§  As  Chinese  companies  gain  tracGon  internaGonally,  they  can  count  on  being  aQacked  by  entrenched  compeGtors,  who  in  many  cases  may  enjoy  commanding  posiGons  supported  by  the  most  advanced  communicaGons  capabiliGes  available  today  

§  Meanwhile,  in  many  Chinese  companies,  corporate  communicaGon  is  an  underdeveloped  and  poorly  understood  low-­‐status  funcGon  

§  Even  before  then,  Chinese  companies  will  be  up  against  generic  negaGve  stereotypes  that  are  commonplace  in  many  markets…  

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Chinese  companies  overseas  -­‐  especially  in  the  West  -­‐  have  been  tagged  with  nega5ve  ‘na5onal’  stereotypes:  §  Unfairly  exploitaGve;  interested  in  ‘extracGng’  from  host  markets  rather  than  

‘contribuGng’  benefits  to  communiGes  §  CommodiGzed  ‘quanGty’  players  who  compete  on  price  rather  than  on  quality  §  Hierarchical  ‘machines’  with  top-­‐down  command  and  communicaGons  §  NaGonalisGc  and  conquering  in  mentality  towards  other  countries  §  UnsophisGcated  when  it  comes  to  corporate  social  responsibility  §  Agents  of  PRC  state  power  and  potenGally  a  security  risk  §  Environmentally  ‘toxic’  with  polluGon  problems  likely  §  Untrustworthy  in  keeping  commercial  agreements    §  Flagrant  abusers  of  intellectual  property  §  Culturally  and  ethnically  homogenous  §  Harsh  employers  with  HR  problems  §  Lacking  in  transparency    §  Ethically  suspect  

The  ‘naGonal’  challenges  for  Chinese  companies  

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The  opportuni5es  for  Chinese  companies  

§  These  are  the  kinds  of  characterisGcs  that  may  be  unfairly  assumed  to  be  true  of  a  Chinese  company  overseas  before  it  even  gets  started  with  its  communica%ons    

§  While  these  may  seem  to  be  daunGng  obstacles,  fundamentally  they  represent  tremendous  opportuniGes  for  Chinese  companies  who  have  the  ‘power  to  surprise’  with  posiGve  behaviour  that  will  directly  contradict  these  negaGve  preconcepGons  

§  Indeed,  it  is  the  contrast  between  the  negaGve  percepGons  in  theory  about  Chinese  companies  and  their  posiGve  performance  in  reality  that  will  build  the  best  image  

§  The  key  test  outside  of  China  is  making  sure  that  when  people  hear  about  a  new  Chinese  company  for  the  first  Gme,  they  do  and  think  things  favourable  to  the  company  in  direct  consequence  

§  It  is  cri5cally  important  that  Chinese  companies  become  well  known  interna5onally  for  the  posi5ve  things  they  stand  for  in  the  first  place,  rather  than  become  famous  first  through  nega5ve  mistakes  

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Tencent’s  posi5ve  global  introduc5on  

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Consider  the  case  of  Huawei    

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How  some  foreign  companies  fail  to  communicate  in  China  

§  Being  seen  to  ‘take’  and  not  ‘give’  §  Engaging  the  wrong  people  to  communicate  §  Lack  of  respect  for  local  culture  and  language  §  Failure  to  listen  to  their  stakeholder  communiGes  §  Misreading  the  tastes  and  preferences  of  the  market  §  Lack  of  effort  to  build  relaGonships  through  earning  trust  §  ‘Bulldozing’  of  ‘global’  markeGng  from  the  home  country  §  Double-­‐standards  in  how  they  treat  customers  and  employees  §  Thinking  they  can  get  away  with  pubng  boundaries  around  

markets  in  a  digital  world  where  ‘local’  can  become  ‘global’  

       Chinese  companies  should  avoid  making  the  same  mistakes!  

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Like  this  recent  example  from  Japan…    

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Not  all  countries  think  and  feel  the  same  as  China  

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Understanding  the  communica5ons  context    

§  The  first  thing  to  do  is  hold  up  a  mirror  and  take  a  fearless  inventory  of  where  the  company  stands  with  its  overseas  communicaGons  efforts  

§  In  the  communicaGons  world,  this  is  oden  called  a  ‘situaGon  analysis’  which  asks/answers  quesGons  like  these:    ü  Does  the  company  communicate  overseas,  and  if  so,  how?    ü  Is  there  any  pre-­‐exisGng  profile  -­‐  or  is  the  company  completely  unknown?    ü  If  there  is  some  awareness,  then  what  is  the  company  known  for  (what  is  the  first  

thing  that  ‘comes  to  mind’)?    ü  What  industry  category  is  the  company  thought  to  be  in?    ü  Do  any  of  its  products  have  brands  that  are  familiar?    ü  Has  there  been  any  overseas  media  coverage  in  the  past  and  if  so,  was  it  posiGve  

or  negaGve,  of  benefit  to  the  business  or  harmful?    ü  Is  the  company  seen  as  ‘just  Chinese’  or  ‘truly  internaGonal?’    

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Sebng  the  communicaGons  objec5ves  

§  Once  there  is  an  understanding  of  where  the  company’s  communicaGon  starts  from  overseas,  then  it  becomes  much  easier  to  set  course  for  the  desired  desGnaGon  

§  In  other  words,  as  the  result  of  new  investment  in  internaGonal  communicaGons,  the  things  the  company  will  gain  during  the  years  to  come  compared  to  what  it  has  today?  ü  A  higher  profile  and  more  favourable  image  perhaps?    ü  A  clear  widespread  understanding  of  what  business  the  company  is  in?    ü  Maybe  a  greater  quanGty  and  quality  of  media  coverage?    ü  A  large  and  growing  social  media  community?    

§  All  of  these  communicaGons  objecGves  should  be  explicitly  designed  to  support  the  success  of  the  company’s  commercial  goals,  such  as  winning  contracts  or  driving  sales  

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Mapping  the  target  audiences    §  For  the  purposes  of  building  an  image,  an  ‘audience’  consists  of  the  stakeholders  

whose  thoughts  and  acGons  will  determine  the  extent  and  the  speed  of  achieving  the  communicaGons  objecGves  

§  Every  Chinese  company  going  global  should  map  out  the  overseas  stakeholders  important  to  its  business  success,  and  then  engineer  introducGon  opportuniGes  accordingly  with  the  express  aim  of  fostering  long-­‐term  relaGonships  

§  Such  stakeholders  should  include:    ü  media  ü  government  ü  NGOs  ü  suppliers  ü  shareholders  ü  employees  ü  customers  ü  key  opinion  leaders  ü  local  communiGes  

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Listening  to  stakeholders    §  Contrary  to  out-­‐dated  misconcepGons,  nowadays  communicaGon  should  start  with  

humble  listening,  not  boaslul  talking  §  CommunicaGon  is  becoming  more  about  conversaGons  and  dialogue  §  The  process  involves:  asking  stakeholders:    

ü  if  they  would  like  a  relaGonship  with  the  company  ü  finding  out  what  kind  of  informaGon  they  would  like  to  receive  ü  seeking  their  advice  and  guidance  on  the  communicaGons  content  important  to  

them  §  Listening  is  the  first  stage  to  effecGve  communicaGon  and  making  the  other  person  

feel  important…  

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This  persuasion  theory  goes  back  a  long  Gme…  

“Make  the  other  person  feel  important  >  and  do  it  sincerely”  

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Establishing  the  strategy      §  All  corporate  communicaGons  plans  should  include  a  strategy;  namely,  the  

approaches  and  designs  that  will  guide  everyday  acGviGes  §  For  example,  if  a  company  is  known  for  one  of  its  old  products  in  a  declining  market,  

the  communicaGons  strategy  might  involve  an  emphasis  on  the  new  products  in  the  pipeline  that  will  be  the  moneymakers  of  the  future  

§  Knowing  what  kind  of  informaGon  is  relevant  and  found  most  compelling  will  inform  the  development  of  the  right  strategy  

§  Before  a  company  communicates,  it  should  have  some  idea  of:    ü  what  abtudes  it  is  trying  to  reinforce  ü  senGments  it  seeks  to  change    ü  new  ideas  it  wants  to  get  across    

§  For  Chinese  companies,  ‘societal  alignment’  with  the  sensibiliGes  of  each  target  market  is  key  

“100%  growth  every  year”  or  “being  a  global  top  10  player”  are  not  strategies!  

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CreaGng  the  corporate  story    §  MulGnaGonal  companies  are  highly  complex  organizaGons,  but  unfortunately  

complexity  is  the  enemy  of  clear  and  convincing  communicaGon  §  Such  a  narraGve  consists  of  messages  and  evidence…themes  designed  to  persuade  

the  target  audiences  and  evidence  through  data  proving  that  the  company  should  be  believed  

§  That  is  why  it  is  so  crucial  to  create  a  brief  ‘corporate  story’  that  should  answer  three  quesGons:    ü  why  is  the  company  in  business    ü  what  it  is  doing  -­‐  and  who  is  it  doing  them  for  ü  how  it  is  doing  those  things  and  what’s  disGnct  about  its  approach?  

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Communicate  ‘the  golden  circle’  

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Designing  the  tac5cs    §  CommunicaGons  campaigns  should  list  in  detail  the  specific  and  tangible  acGviGes  

which  staff  or  consultants  actually  spend  their  Gme  doing  §  These  tradiGonally  include:    

ü  building  stakeholder  databases  ü  tracking  the  global  media  ü  arranging  interviews  with  journalists  ü  organizing  events  ü  issuing  press  releases  ü  producing  content  including  photos  and  videos  ü  creaGng  media  material  about  the  company  and  its  products  or  services  

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Going  beyond  the  basics  

§  Media  relaGons  and  publicity  will  always  be  a  core  part  of  overseas  communicaGons  §  But  now,  these  acGviGes  are  all  part  of  the  mix:  

ü  creaGng  content  ü  building  communiGes  ü  understanding  analyGcs    ü  applying  the  ‘psychology  of  persuasion’    

§  It’s  all  about  using  targeted  communicaGons  to  build  new  relaGonship  communiGes,  create  content  for  conversaGons  between  brands  and  their  consumers  where  rather  than  act  like  machines  or  ‘things’,  the  Chinese  companies  communicate  like  actual  people  

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These  days,  every  company  can  be  a  media  company  

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The  big  picture    

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ProtecGng  the  reputa5on  

§  The  worst  thing  that  could  happen  to  a  rising  Chinese  company  going  global  is  becoming  world  famous  via  social  media  for  making  a  mistake:  

 

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Because  crises  will  happen  

§  Having  a  crisis  communicaGons  programme  in  place  is  absolutely  essenGal  in  order  to  safeguard  the  good  name  of  a  company  operaGng  internaGonally  

§  Something  will  go  wrong  in  some  country  at  some  point  –  it  always  does  –  and  Chinese  companies  need  to  be  prepared  to  handle  high-­‐profile  local  issues  which  can  explode  into  full-­‐scale  global  crises  owing  to  the  escalaGon  power  of  social  media              

§  Chinese  companies  must  know  that  it  is  going  to  be  hard  protecGng  their  reputaGon  –  especially  in  the  West  –  unless  they  take  transparency  seriously,  show  that  they  respect  local  communiGes,  and  listen  to  the  voices  of  others  such  as  NGOs  

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Eight  keys  to  success  in  protecGng  reputaGon  

1.  What  the  company  says  must  match  what  the  company  is  doing  2.  Expect  the  unexpected  –  map  risks  and  be  ready  with  responses  3.  Prepare  assiduously  and  rehearse  communicaGons  disaster  4.  Move  fast  because  whomever  speaks  first  is  oden  believed  most  5.  Be  responsive  and  look  to  listen  6.  Admit  mistakes  and  accept  responsibility  7.  Don’t  get  into  fights  where  criGcs  tend  to  win  8.  Don’t  be  heavy-­‐handed  or  arrogant  

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Be  prepared  to  apologise  when  something  goes  wrong