2011: Now Trending in Employee Engagement

10 January 2011

By Lindsay Hutter, US Director, Change & Internal Communications

Employer/employee relationships will continue to undergo challenge and change like never before. Economic pressures are not abating, and so will continue to put some very difficult questions in front of companies about their overall cost models and their labor costs.

At the same time businesses are facing these pressures, a growing percentage of their workforce—namely, the Millennials—will continue to be less content than ever to accept salary freezes and benefits reductions and be more expectant of career advancements far more quickly than their parents and grandparents.  As the third generation successors to the “sacrifice for country and company” servicemen and servicewomen of WWII, Millennials will continue to demonstrate an uninhibited pursuit of creating their own career ladders and seek to impose an entirely new set of expectations on today’s employers.  In addition, the Millennials’ large appetite for transparency—more than double the need of other generations—will continue to grow.

Corporate Implications

The most fundamental implication of these trends is that a one-size-fits-all model cannot carry the weight of responding to markedly different generations in the workplace.  What that means practically is that organizations will need to address their employees the same way they do their customers—recognizing that there are different needs, career desires and motivators across their employee populations and thoughtfully and collaboratively evolve to a model that serves the company’s mission and talent needs.

Smart organizations will look beyond tweaks and seize the moment as one to reinvent their employee engagement model to address new workplace and societal realities. A starting place is the way companies inform and engage employees about the need for change.  Fresh approaches to inviting employees to contribute to the design as well as the execution of change will create a sustainable employer/employee relationship model for a more challenged economy, which seems to be what the future holds. Old approaches of cutting budgets and waiting for the economy to turn will only entrench an old way of employee engagement into company cultures and leave businesses ill-prepared for the future and uninspiring for their employees.

It’s also vital that companies address Millennials’ growing desire for transparency. Companies will need to be more open about change to avoid delivering an unintended invitation to their younger workers to seek out the truth they feel is missing in company messaging.

In the race for young talent and especially young talent that’s less expensive than “old talent,” companies will have to be careful not to be too solicitous of Millennials nor too quick to lose the wisdom of older talent. Multiple generations in the workplace is a challenge to manage and lead. But for companies that take time to think of this diversity as a symphony and lead these generations like a maestro that recognizes each instrument’s gifts, the rewards will make work more fascinating and the company’s performance more successful.

2011: Now Trending in Energy

07 January 2011

By Chris Gidez, Senior Vice President & US Director,
Risk Management/Crisis Communications

In the US, the three most significant forces that will shape the energy sector in the coming year are the economy, the new political order in Washington, DC, and the fallout following the BP oil spill.

There is a direct correlation between the economy (US and global) and energy demand.  While the US economy may remain stagnant, growth in Asia – particularly China – translates into greater energy demand and a related rise in oil prices.  Should the economy continue to stagnate, energy demand will remain flat as well.  But if the economy begins to accelerate, we should see a growth in demand for all forms of energy–oil, gas, electricity, etc., and an associated rise in their cost.

Despite public enthusiasm around renewables and biofuels, these subsectors should be challenged in the coming year as the resurgent Republican party in Washington will show less enthusiasm for the tax incentives and subsidies that have historically supported the development of these emerging technologies.

And finally, the BP spill, and to a lesser degree the pipeline incidents involving Enbridge and PG&E, will lead to greater political and regulatory scrutiny–even with a divided Congress.

Company Implications
From a communications and reputation standpoint, energy companies will need to focus on two priorities in 2011: demonstrating their value to quality of life, the economy and the environment; and convincing consumers, voters and policymakers they deserve their trust. This will be particularly true for oil and gas companies, but will also apply to the rest of the sector.

Meanwhile, for all companies in the extractive industries (oil, gas and coal), safety will become a strategic message.

While still important, the debate over climate change will take a back seat to the more acute debates over deepwater exploration, oil sands development, the recovery of shale gas through hydraulic fracturing, and the siting and safety of pipelines.

Developers of renewable energy projects (notably wind and solar), will also be challenged by the NIMBY (Not In My Backyard) syndrome, as communities may push back on the siting of projects, as well as with their cost.

2011: Now Trending in the Media Industry

07 January 2011

By Terry Neal, Senior Vice President, Director, Strategic Media

Online ad revenue for mainstream media publications will begin to rebound, helping to stem the hemorrhaging of their parent print publications. But the rebound won’t be enough to ease the pain, leading to continued downsizing in the industry. The downsizing will particularly affect the ability of mainstream publications to retain top-end talent.

AOL Patch will continue its rapid expansion. Print publishers and local TV news producers will continue to try to figure out a way to monetize narrowly focused community news, and will search for creative business models to do so.

The continued pressure to keep up with technology will push organizations to move from the model of reporters as content creators to bloggers who are content aggregators. Increasingly, journalists will rely on second- and third-hand, often non-verifiable information, rather than personal, verifiable sources and information, blurring the lines between content creators and aggregators.

The rise of the personally branded journalist will intensify in the coming years. The best journalists will be those who produce not just the best content, but those who draw the most eyeballs through self-marketing via social media.

The media demigods will watch, but not follow Rupert Murdoch’s lead in putting content behind paywalls. While The Financial Times and The Wall Street Journal have had success with the model, most publishers will conclude that this works only with specialized content targeted at affluent audiences.

Company Implications
To navigate the complicated media landscape, communications agencies will need to modernize their staff with special digital training and boost specialty units or divisions of digital strategists. Companies will need to see PR and marketing as key competencies, with hard metrics that can be measured through various digital applications.

As communications strategies become increasingly more sophisticated, PR professionals will need to integrate social media strategies directly into overall strategies. The new landscape will necessitate a re-alignment in PR target opportunities, given the vastly broadening array of influencers. Economic pressures and expansion in media bandwidth/coverage space will produce an increasing number of creative merges and shotgun marriages and a reinvention of the medium in 2011. That will result in multiple platforms per outlet.  An understanding of outlet reach and new ranking in the media firmament will be key to communicate to clients.

2011: Now Trending in Corporate Social Responsibility & Sustainability

06 January 2011

By Chad Tragakis, US Director, Corporate Social Responsibility

In spite of changes in Congress, questions over the validity of research, and a general “green fatigue” on the part of many Americans, climate change will still be accepted as the primary environmental issue and challenge of our time.  Research strongly suggests that citizens expect businesses to play a role in mitigating it, and act in concert with government to address it.  Additionally, business risk related to climate change will remain increasingly important to mainstream investors, and many will continue to scrutinize corporate sustainability reports and other collateral as a window into the company and its exposure.

External influencers and organizations will continue to impact consumer brand perceptions more than corporate PR or CSR reports.  Research suggests that consumers want more information on a company’s commitment to corporate responsibility and sustainability, but need that information in simpler ways and where it connects to them.

Interest in the environment will remain strong on the part of both businesses and consumers. We will also continue to see an increase in firms applying for LEED certification for their facilities, and entering into strategic partnerships with environmental conservation organizations.

Water use, availability and scarcity will continue to be of growing concern in nearly every part of the world, posing a major operational and reputational issue for companies.  This is especially true for firms in water-intensive industries, but since every company uses water, it will be an issue for the entire business sector.

Corporate Implications

Leading companies are recognizing and responding to consumer demand for action and information regarding climate change, and embracing this as an opportunity for reputation building and thought leadership.  To stand out, companies will need to rethink where and how they share and celebrate their climate change related programs, policies and partnerships with customers and stakeholders.  As is often the case, one innovative and memorable effort will be worth more than dozens of smaller ones.

In response to changing influences on consumer brand perceptions, sector leaders will need to integrate their company’s CSR story into mainstream consumer communications channels–from marketing and television advertising to in-store displays and product packaging to digital communications.

It will be essential for companies to carefully navigate “green” opportunities and partnerships, as vocal consumers, activist NGOs and government regulators such as the Federal Trade Commission continue to call firms out for greenwashing, fraudulent claims and abuse of marketing communications.

Companies will need to get in front of the water issue first by conducting assessments of their true water “footprint,” taking steps to minimize use throughout their supply chains and product lifecycles and then highlighting success stories and sharing best practices with customers, partners, regulators and other stakeholders.

2011: Now Trending in Entertainment

06 January 2011

By Hope Boonshaft, EVP and General Manager, Southern California

Expect to see an intense focus on products and services geared to the way today’s consumers want to view entertainment, for example, the introduction of a slew of new tablets and smart phones with expanded capabilities and applications. Another key trend is the ability to digitally connect the home with all personal devices. While Apple and Google have been trying to capture the market to connect the Internet to the TV, many CE manufacturers and service providers will partner with the studios and enter the marketplace.

Sales of Blu-ray discs and players will outpace traditional DVDs and players. With their Wi-Fi capabilities and ability to copy and download additional film material online, Blu-ray players are seen as the gateway to the digital future for consuming entertainment. On the broadcast and cable side, Video on Demand (VOD) will take a front seat as studios will be pushed to offer VOD as an alternative to buying or renting physical discs. Kiosks that offer DVD and Blu-ray disc rentals for as low as one dollar a night will be another key factor in consumers’ viewing decisions. Despite popular belief, physical discs will be available for the next decade even with the escalation of digital delivery growth.

Consumers will be split as to quality versus convenience.  Convenience will remain key, but if consumers encounter problems with streaming, downloading or playing content, they will quickly abandon it.  The true die-hards will stick with quality and go for the rental or purchase of Blu-ray discs. Another trend will be the storage of the content purchased via download. The digital locker, or “the cloud” as some call it, will become more front and center for consumers to store their content in a place that is not connected to their personal computer.  This will ease fears of losing one’s own content if your computer crashes.

3D will continue to be a factor that studios consider when green-lighting a film, as it is better quality to shoot in 3D than to transfer it from 2D to 3D.  3DTV for the home will be a big push for CE manufacturers, who hope that studios will release as many 3D discs as possible, giving consumers a reason to buy these new sets.

Corporate Implications

With marketing costs skyrocketing, studios will need to continue to consider re-making old films and building franchises. They will also need to offer more VOD, as the battle of “windows” (at what point after theatrical opening content is available for purchase, rent or download) continues.

Service providers such as telcos, satellite companies and cable operators, will need to make strategic alliances with CE manufacturers to meet consumers’ growing demand to view entertainment anytime, anyplace and on any device. New and existing content delivery companies, such as Hulu, will have to determine whether to base access to content on ad sales or subscription basis. Finally, until there is more 3D cable and broadcast content, as well as 3D Blu-ray discs and players, on the market, CE manufacturers will have to make a big push to sell 3DTVs.

2011: Now Trending in Public Affairs

05 January 2011

By Michael Kehs, US Director, Public Affairs

With the Republicans taking back the House of Representatives and greatly reducing Democratic ranks in the US Senate, it will be almost impossible to enact any controversial legislation. We are unlikely to see legislation of the magnitude of the 2010 Patient Protection and Affordable Care Act and Financial Reform for the next two years because of simple arithmetic.

In the Senate 60 votes are required to bring a measure to the floor.  Virtually every issue of any consequence faces a filibuster threat. With a new alignment of 53-47 in the 112th Congress the Democrats will find it tough sledding to attract seven Republican votes. For the Republicans to find 13 Democratic votes will be nearly impossible. Minority Leader McConnell has publicly indicated that finding 41 votes among his Republican Caucus should prove no problem. This means he controls the legislative agenda even though Democrats cling to a narrow majority. If he does not want an issue addressed, it will not be addressed. Gridlock will likely reign despite the punditry corps’ current claims that the political parties have to work together to address the on-going economic tribulations.

Over in the House of Representatives expect an onslaught of legislative initiatives.  With the Republicans controlling at least 242 seats, based on the most recent tabulations, and only needing 218 votes to pass a bill, they can pass whatever they like with little fear of the Democrats countering their priorities. Plans are in the works for the “bill of the week” to demonstrate to the electorate that Republicans are in tune with public desires to see more done to create private sector jobs and reduce government spending. However, when these bills make their way over to the Senate they are likely to be unceremoniously tossed aside.

Although the prospects for momentous action are bleak, divided government could lead to the enactment of narrow legislation in any of these broad areas if either side shows a proclivity toward compromise:

  • Tax Reform (Tax cuts, International competitiveness)
  • Regulatory Reform
  • The End of Earmarks
  • Tort Reform
  • Energy Jobs Initiative
  • Healthcare Law Changes

Corporate Implications
The potential consequences of the change in Congressional leadership could pose a serious set of new challenges for Corporate America. Some corporations are mistakenly interpreting congressional gridlock as a positive indicator that they are no longer in the crosshairs. What has changed is the venue for action, not the threat of government intervention into a whole host of business activities. The Obama administration has been signaling for some time its intent to become much more focused on regulatory activity.

Federal agencies have a backlog of rules to promulgate. They are working against a White House-imposed deadline of 2012, prior to the next Presidential election.  The Environmental Protection Agency, under Administrator Lisa Jackson, has shown an unprecedented willingness to circumvent the legislative process, unilaterally issuing rules that antagonize a wide swath of the business community.

Large healthcare and drug companies will face over 40 major rules implementing the Affordable Care Act. Every company that depends on Medicare and Medicaid reimbursements will be affected. Over 200 rules are said to be in the works to implement the changes to our financial laws. Investment banking, credit card companies, insurance interests and accounting firms are all in play.

Infrastructure and transportation related businesses are facing acute appropriations concerns given the Republicans’ disdain for any “stimulus” oriented measures. Telecommunications companies are in for more FCC regulatory action encompassing a myriad of concerns from net neutrality to broadband.

In this environment, every company now has a new business partner–Uncle Sam–whether they like it or not. The bottom-line for business is they will have no choice but to engage with government, find allies and shape public policy at every opportunity.  Not engaging puts American businesses’ bottom-lines in severe jeopardy.

2011: Now Trending in Food & Beverage

05 January 2011

By Maruta Bergmanis, SVP, Food & Beverage

Expect to see even more key influencers (in addition to First Lady Michelle Obama) jumping on board to discuss child nutrition and the fight against childhood obesity. These influencers will continue to amplify the growing problem in the US by educating consumers and encouraging them to get involved.

Consumers will continue to demand F&B products that have a strong reputation, but that also provide value. Although the recession will still be on their minds, consumers will show that they are willing to spend more money on a food product they perceive as trustworthy.

In addition, consumers will continue to rely heavily on technology to drive their food purchases.

Company Implications

In 2011 and beyond, it will be key for CPG food brands to show consumers how they are making their products healthier by removing salt, saturated fat, etcetera, and how they are helping schools and consumers become more educated about nutrition and childhood obesity. A recent study showed that the average consumer is more likely to support a brand if it is giving back to the community or helping to support a cause. And, improving education is the second biggest supported charity after protecting the environment.

When it comes to buying food products, consumers continue to look for three things: quick, easy and budget friendly. With many grocery stores now creating their own private label brands with inexpensive products, companies will have to step up their game and show consumers why their products are meaningful. This means increased consumer PR activities to drive credible brand product messages, but also increased social media activity.  This means brands will need to actively listen to their communities online, respond appropriately and continuously find new ways to engage and keep consumers loyal to their brands.

Technology will play an increased role in consumer purchases, both in-store and out-of-store. Through social media channels such as Twitter and Facebook and gadgets such as the iPad and iPhone, consumers have information at their fingertips 24/7. They can be in a grocery store and download a coupon within seconds. To keep pace, food brands will have to get out there and offer instant gratification for coupons, recipes and tips.

Hello world!

04 January 2011

Welcome to Collective Conversation.

This is a brand new Collective Conversation blog and the owner has yet not published their first post.