2-1 © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

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2-1 © The McGraw-Hill Companies, Inc., 2002 All Rights Reserved.

  1. 1. Business and Society POST, LAWRENCE, WEBER Business and Public Issues Chapter 2
  2. 2. <ul><li>This chapter focus on these key questions and objectives: </li></ul><ul><li>What are public issues, and what is the life cycle through which they evolve? </li></ul><ul><li>What are the duties of a company’s public affairs manager or office? </li></ul><ul><li>What tools or techniques are available to public affairs managers to assess an organization’s multiple environments? </li></ul><ul><li>What are the steps in the issue management process? </li></ul><ul><li>How is competitive intelligence gathered and used? </li></ul><ul><li>How can a public affairs manager effectively respond to an organizational crisis? </li></ul>
  3. 3. <ul><li>Public Issues </li></ul><ul><li>A public issue is an issue that is of concern to an organization’s stakeholders </li></ul><ul><li>The emergence of a new public issue usually indicates that a gap has developed between what stakeholders expect and what an organization is actually doing. </li></ul><ul><li>Performance–expectations gap </li></ul>
  4. 4. The performance-expectations gap Corporate Stakeholder Performance Expectations - Actual performance - Expected corporate performance - Outcomes - What stakeholders want - Results - Satisfaction - Impacts on others - Disappointment or anger “ How wide is the gap?”
  5. 5. The Performance-Expectations Gap Performance (Economic and Social) Time Performance Gap Expectation Actual
  6. 6. Figure 2.1 A Stakeholder Network Focusing on a Public Issue Stakeholders with a shared focuses on an issue Stakeholders with a shared focuses on an issue Stakeholders with a shared focuses on an issue Stakeholders with a shared focuses on an issue Stakeholders with a shared focuses on an issue
  7. 7. The Public Issue Life Cycle <ul><li>A public issue exists when there is a gap between the stakeholder expectations of what an institution should do and the actual performance of those businesses, government agencies, or nonprofit organizations </li></ul><ul><li>Refer to Figure 2-2 (page 25) </li></ul>
  8. 8. Figure 2.3 The public issue life cycle High Low Time Life Cycle of Issue Management Discretion Level of Stakeholder Concerns Phase 1: Changing Stakeholder Expectations Phase 2: Political Action Phase 3: Formal Government Action Phase 4: Legal Implementation
  9. 9. Managing the Public Affairs Function <ul><li>The growth of public affairs activities in business organizations has several causes: </li></ul><ul><ul><li>External forces </li></ul></ul><ul><ul><li>Internal forces </li></ul></ul><ul><li>Public affairs management refers to the active management of a company’s external relations, especially its relations with external stakeholders such as government and regulatory agencies, customers, investors and communities. </li></ul><ul><li>Refer to Figure 2-3 (page 29) </li></ul>
  10. 10. Issues Management <ul><li>A structured and systematic process to aid organizations in identifying, monitoring, and selecting public issues that warrant organization action. </li></ul>
  11. 11. Scanning the Environment <ul><li>Environmental analysis provides managers with the information about external issues and trends that enables an organization to develop a strategy that minimizes threats and takes advantage of new opportunities </li></ul><ul><li>Environmental intelligence is the acquisition of information gained from analyzing the multiple environments affecting organizations </li></ul><ul><li>Refer to Figure 2.4 (page 33) </li></ul>
  12. 12. Eight Strategic Radar Screens Figure 2.4 Seeking Environmental Intelligence Geophysical environment Legal environment Social environment Political environment Technological environment Customer environment Economic environment Competitor environment
  13. 13. Eight Strategic Radar Screens <ul><li>Customer environment includes the demographic factors </li></ul><ul><li>Competitor environment includes information on the number and strength of the organization’s competitors </li></ul><ul><li>Economic environment includes information about costs, prices international trade, and any other features of the economic environment that affect customers and competitors behavior </li></ul><ul><li>Technological environment includes the development of new technologies and their applications affecting the organization </li></ul>
  14. 14. Eight Strategic Radar Screens <ul><li>Social environment includes cultural patterns, values, beliefs, trends, and conflicts among the people in the societies where the organization conducts business or might conduct business </li></ul><ul><li>Political environment includes includes the structure, processes, and actions of all levels of government-local, state, national and international </li></ul><ul><li>Legal environment includes legal considerations of patents, copyrights, trademarks, and intellectual property </li></ul><ul><li>Geophysical environment includes an awareness of the physical surroundings of the organization’s facilities and operations, and the organization’s dependency and impact on natural resources such as minerals, water, land or air </li></ul>
  15. 15. Figure 2-5 The issue management process Policy Options Program Design Results Issues Identification Issues Analysis Research Judgement and priority setting Policy and strategy selection Implementation Performance evaluation
  16. 16. Competitive Intelligence <ul><li>The systematic and continuous process of gathering, analyzing and managing external information about the organization’s competitors that can affect the organization’s plans, decisions, and operations </li></ul><ul><li>The importance of the ethical considerations when collecting competitive intelligence cannot be understated </li></ul>
  17. 17. Crisis Management <ul><li>A process companies use to respond to short-term and immediate shocks, e.g. accidents or disaster. </li></ul><ul><li>Four characteristics of crisis: </li></ul><ul><ul><li>Surprise </li></ul></ul><ul><ul><li>Lack of control </li></ul></ul><ul><ul><li>Escalating pace of events </li></ul></ul><ul><ul><li>Intense scrutiny </li></ul></ul>
  18. 18. Effective Crisis Management Plan <ul><ul><li>Prepare for action by creating an internal communication system that can be activated the moment the crisis occurs </li></ul></ul><ul><ul><li>Communicate quickly, but accurately </li></ul></ul><ul><ul><li>Use the internet to convey the public affairs message </li></ul></ul><ul><ul><li>Do the right thing </li></ul></ul><ul><ul><li>Follow up and where appropriate, make amends to those affected </li></ul></ul>

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