Introduction
Paul A. Argenti has discussed how a business’ corporate communication of internal and external communication to its constituencies should be, in the third and the seventh chapter his book Corporate Communication.
He gives a new outlook on corporate communication by examining the external and internal communication through examples and instructions on how corporate communications ought to be. Argenti has made a strong argument that I found predominantly convincing, however, there are some points in his arguments which I do not fully concur with.
Business corporate external communication
In Chapter Three, An overview of the Corporate Communication Function, Argenti tackles the corporate communication on the external scale. Primarily, he points out that the CEO should be the one to be most involved in developing both the overall strategy for communication and delivering consistent message to constituencies (p.51).
According to Argenti, the upper management is indispensable to corporate communication owing to their enhanced credibility and a higher capability in guiding and hence serving as the principal driver of corporate communication. Nevertheless, this is not always true as regards to either external or internal corporate communication. Upper management is without doubt at the heart of communication since people’s perception about a company first comes from the CEO who has the highest ranking.
A CEO’s reputation or image has a great impact on the corporate image or culture, however, middle management, including every employee plays a vital role in corporate communication because everyone has a stake in safeguarding the reputation of the company. A good example in this argument is a Dell company in Taiwan that mispriced a 19-inch monitor and a 20-inch monitor quoted at NT$500 and NT$999, respectively, but whose regular prices are NT$7,500 and NT$7,999.
In eight hours, 26,000 online shoppers shot on the deal, giving orders of 140,000 before the error was corrected. Dell corrected the mistake, removed it from sale and emailed all purchasers apologizing and refunding the money. Unfortunately, this already had serious legal and reputational implications on the company as it was fined $30,500 dollars. They were also ordered to sell the monitors at that low price, but instead they refused, offering customers discount vouchers.
Worse though, was the customers’ accusation of fraud on Dell leading even to frozen accounts for two days and affecting its public relations. This was clear evidence that employee’s mistakes on tagging the price can ruin a company’s image overnight; therefore, everyone within the company has an impact on the company’s reputation. No matter how convincing and eloquent speeches the upper management delivers after the mistake, customer’s perception about Dell’s ruined credibility is unlikely to change.
Middle management and lower management also play an essential role in corporate internal communication since they are the participants in conveying the message. For example, from the reality show Under Cover Boss, Choice Hotels’ CEO only became conscious through under-covering as an employee that one of the hardworking front receptionist, devoted to her work and wanted to get training has not been aware of the free training program.
Then the CEO realized that, despite the fact that the training programs have been there for a long time, middle and low management employees seemed oblivious of their existence. That can serve as a proof that corporate communication is not the sole responsibility of the CEO, and on the contrary every employee has a responsibility of ensuring that messages from top management are delivered to other employees within the organization.
To add onto this discussion of the importance of upper- management in corporate communication, a company’s reputation can also be enhanced through corporate advertising (Argenti p.55). This is true for the earlier part that corporate advertising can strengthen the already good image or lessen the damages of bad public images; however, corporate communication cannot entirely overturn the public’s perception about the corporate image.
One excellent advertising campaign can impose the public image of the company to make to it better; one good speech for the company’s mistake can lessen the further damage about the company’s reputation; however; one bad image cannot be saved by good corporate communication.
This can be well illustrated in the example of Toyota. After the acceleration problems that cost people’s lives, Toyota was trying the best way possible to reverse their public image by advertising and giving incentives for car buyers to rebuild their credibility.
This was the same case in the 1980s when Audi 5000 dealers had the same acceleration problem and their sales were reduced to nothing. A damaged credibility or reputation is hard to quash largely because for business, reputation can be wafted off overnight due to one unpleasant incident.
It is tough reversing people’s perception once they lose trust of the company especially when there are high expectations. Today, when people are considering buying a new Toyota, first thing that comes to their mind is the acceleration incident that had happened and not the how durable their cars are. Reputation takes years to build; yet, it can be upturned overnight due to ugly incidents that cannot be remedied by good corporate advertising.
Corporate Communication Issues
Argenti (p.184) addresses the issues of corporate communication on the internal scale in chapter seven. He argues that in the recent days, managers have begun to dedicate similar kind of attention to their own employees after recognizing that employees have a lot to do with the success of a business than virtually any other constituency.
Certainly, employees play an inevitably important role in corporate communication; but, every player relating to the company affects the corporate image whether externally or internally ranging from CEO to customers.
Employees are important ingredients for internal corporate communication, but they may have less importance for external corporate communication because what the company does could differentiate the employee’s importance in corporate communication. For service industries, employees are the most valuable assets because the nature of the service industry involves close interactions with customers and their perception about the company emanates from employees.
For a company in technological or manufacturing industry on the contrary, its employees might play a lesser important role than upper management. This is basically because the upper management shows up on the media and gives speech to affect public image and people rarely have the opportunity to relate with the employees of manufacturing industry and technological industry.
On the emphasis of the importance of company employees, Argenti discusses company’s increasing dependence on consulting firms for corporate communication. “Companies look outside their own organizations for help with internal communications”(Argenti, p. 187). Evidently, some companies might not have confidence about their firm’s corporate communication skills and therefore consider professionals as more experienced and hence more reliable.
Nevertheless, external consulting firms may not have the knowledge about the firm’s internal affairs or the company’s culture better than the company employees who have worked for the company for years. Moreover, outside consultants at times represent a waste of resources by being overpaid yet the employees are able to do a better job since they have a better understanding of the company and can deliver it to the public within reasonable salaries.
It is upon, the company to discover the talented employees who have corporate communication skills and good knowledge of the company instead of paying large sum to outside consulting firms. Additionally, Employees with experience inside the company have a certain level of loyalty than outside consultants.
Moving away from the focus of hiring outside consulting firms for corporate communication, Argenti then addresses the significance of company’s informal form of internal communication (grapevine). The company grapevine is an informal communications network, including private conversations between two employees to the latest anecdotes shared in the cafeteria; these should be considered as much of a communication vehicle as a company’s house organ or employee meetings (Argenti, p.197).
In a nutshell Argenti is referring to gossips and rumors, plus asserts that they should be allowed and recognized by managers and again use them to their advantage for corporate communication. Nevertheless, many conservative managers prohibit company grapevine.
Argenti’s insight on grapevine was definitely eccentric but clever because managers need to recognize the fact that grapevine is inevitable in a company; ranging from the bottom employees to the top management. Therefore, managers should use the company grapevine as a tool to create successful communication channels. At times employees do not have a direct channel to communicate with top management and certainly, grapevine becomes the only source of information for employees.
On this note, managers ought to be careful with the grapevine and instead, have consistent discussions with employees to ensure the accuracy of the information. This will to a great extend prevent the negative influence of false information. Managers can initiate use of grapevines to spread information for their purpose, such as calling in employees to meeting and purposely asking them not to spread the information if the employees would eventually leak the information.
Conclusion
In conclusion, Argenti certainly takes on different perspectives and approaches on examining the corporate communications and arguably most of his statements are right. On the other hand, a number of his arguments for external corporate communications seem too ambiguous and not entirely correct.
Despite the fact that his insight about internal communication was provoking and informative, it can possibly direct readers to think about alternative and efficient ways of internal communication within company. Argenti appears too generalized and idealized on external communication while examining the external communication of companies because in reality it is complex and unpredictable.
According to him, the CEO ought to be most involved in the communication, conversely, corporate communication should be everyone’s responsibility because communication is about delivery, receiving, and decoding the message. A corporation basing the communication job solely on the CEO could never be successful because communication is a two or multiple ways of communication.
Not only is the person delivering the message important, but the recipient of the message should have the capacity to receive and decode the message correctly to ensure messages pass appropriately to other recipients. It is pointless for the top management to get most of the importation while majority of middle and bottom management employees do not have the information. This will certainly hinder the creation of successful corporate communication.
His argument that corporate image could be altered by good corporate communication was too idealized. Good corporate communication is certainly important and could serve as an important device for public image; however, it cannot alter the company’s image entirely on its own because public image involves other factors such as company products, marketing and its social responsibilities.
Despite Argenti’s idealistic views on external communications, his investigation into internal communication is very critical. For instance, he does not regard grapevine as a poison but as a tool to foster strategic communication by upper managers. Largely, Argenti made strong and insightful statements on how corporate communication should be today.