Introduction to Corporate Communication

Case Studies from India

Charu Lata Singh, Mona Gupta

• Publisher: Routledge India
• Year: 2021
• Print ISBN: 9781032425306
• eBook ISBN: 9781000516609
• Topic: Business
• Subtopic: Business Communication
• Index: Business

This book examines the evolution of corporate communication in the recent past in the context of the rapidly changing contemporary business environment in India.

Using several case studies, it illustrates the growing need for small and large businesses to recognize and form a direct connection with their stakeholders and further explains the effective ways through which specific business requirements are realized by communication managers. The book explores the greater dependency and function of multiple media strategies and their challenges. It also offers various theoretical and practical insights into the successful integration of diverse communication and marketing strategies like employee communication, investor relations, corporate social responsibility and philanthropy, branding, crisis management, and corporate ethics and governance, among others.

Lucid and comprehensive, this book will be an essential read for students and scholars of corporate communications, business management, media and communication studies, public relations, and marketing, as well as communication and marketing practitioners.

Part I

Chapter 1 Corporate environment An overview

DOI: 10.4324/9781003048596-2

1.1 Evolution of business

The environment consisting of various factors shapes and influences human existence in different aspects. The whole of the human world environment can be broadly put under four fundamental areas, which, over time, have shaped and kept our existence going: culture, politics, war, and business. Business, although the smallest, is the very basis of the quantitative controls on other areas. Businesses have existed since the inception of humankind in one form or another. The Japanese temple construction business Kongo Gumi was founded in 584 ce. Guilds and banks have existed since the 16th century.

In the Indian context, the businesses were part of the social structure and were simple and small entities, sufficient and efficient for running the village economies. These businesses catered to the needs and requirements of villages and fulfilled their needs. The required businesses were namely carpenters, ironsmiths, goldsmiths, potters, and weavers, to name a few. The whole objective of such businesses was to fulfil the requirements of the village and not profit-making, hence contributing to sustainable living. The approach was cooperative rather than competitive. The encouraging and conducive business environments were very much related to the seasonal and climatic conditions which existed in different regions, were in consonance with the natural environment, and were not in conflict with nature. The trade of excess materials, expertise, and produce, however, has been going on for years. The sea routes and silk routes for trades are well known.

The corporates and the businesses in their present form, however, have different and multiple dimensions. Over time, they have developed fresh practices and newer areas of expertise in response to the changing scenarios in the markets and societies in which they operated. The changing environments in which businesses grew also lead to the emergence of various rules and regulations for the companies. The businesses in the evolving environments got influenced and shaped by the existing social, political, economic, cultural, legal, technological, and ideological connotations.

Along with the advent of business, the foundation of various forms of communication for successfully running business entities was also laid. About 150 years ago, the practice of publicizing companies started with the evolution of communication practices and techniques. Mass consumption and mass production lead to communications involving selling activities, publicity, and promotions to lure new markets into increasingly competitive environments.

Historically, there has been a constant evolution of businesses and has passed through different phases which broadly can be explained as the pre-liberalization and the post-liberalization eras.

1.1.1 Pre-liberalization era (1947–1991)

After independence, India adopted a mixed economy and tried to balance the capitalist and socialist models. It leaned more toward and adhered to socialist policies. However, regulations by the government were considered restrictions, and the slow growth rate after independence was named the “Hindu rate of growth”, pertaining to various policies and regulations. The regulations by licensing prevented foreign goods from reaching the market and restricted development. However, few businesses flourished and dominated. For example, Tatas, Birlas, and Dalmias have dominated Indian businesses since pre- independence times. Asian Paints has been colouring Indian homes since 1945. The top 20 businesses controlled about 39% of net assets of the private corporate sector in 1958–1959 (Vaidyanathan, 1995). Several new businesses emerged over that period. Since 1947, India’s corporate world has kept growing in size, depth, and spread. From 100-odd companies at the time of independence, there are now nearly 5,000 companies listed in the BSE. (Source: https://tradebrains.in/10-largest-stock-exchanges-in-the-world/).

1.1.2 Post-liberalization era

After 1991, the Indian economy opened up and liberalization lifted various regulations. The post-liberalization phase brought the following changes.

Liberalization and globalization not only increased competition in the markets but also allowed companies to operate in markets previously considered forbidden. Liberalization encouraged free movement of capital, goods, and services across countries. It led to the dominance of large trading houses, conglomerates, business families, banks, commodity companies, and transnationals from the United States, Switzerland, Britain, and even India.

The post-liberalization period of the late 1990s led to business process outsourcing and knowledge process outsourcing. Liberalized business environments ensured that companies became capable of processing, storing, and retrieving huge amounts of data at ever-dwindling costs due to advanced information technologies.

Furthermore, in recent times, the Make in India, Digital India, Startup India, and ease-of-doing-business initiatives opened up businesses to one-window-solution facilities with flexible programs and initiatives for investors. The Department of Industrial Policy and Promotion focuses on improving policies and guidelines for doing business in India.

1.2 Changing business environment

The evolution and change of the business environment are directly related to internal organizational factors and external influences and impacts on the business. Organizations do not exist in a vacuum. They are part of society as a whole, thereby affecting and getting affected by the social systems, social values, and the overall social climate. The social structure consists of family, personal groupings, professional and pressure groups, and others. The social system entails the social fabric, consisting of religious practices, castes, and others. The social climate offers the values to which they need to adhere in order to remain part of the broader social system.

The corporate environment constitutes the milieu in which corporates operate their functions. They are a part of the social structure, get affected by social system, and work in accordance with a particular social climate.

It is the shared values, beliefs, and attitudes and the ways a corporate operates which give character to an organization and define its nature. It is reflected in its goals, strategies, and approaches to stakeholders and to the community at large.

For a business to grow, it is important that it understands the business environment and knows what the drivers of change are, in a particular social set-up. The characteristics of changing environments need to be analysed and applied in order to establish and grow a business. The values of the organization need to correlate, cohere, and match with the existing social environments, which ultimately shall create the atmosphere for a business to flourish.

Business environments are dynamic and complex in nature. For sustenance, they are dependent on external and internal factors.

1.2.1 External influencing factors

The external influencing factors are political, economic, social, and technological (PEST), along with legal, cultural, and ideological, among others.

These factors create two types of environments: micro-environment and macro-environment:

1. The micro-environment is the operating environment of the organization on which it has some control, namely suppliers, consumers, market intermediaries, competitors, and the public.
2. The macro-environment is affected by technological advancements, global or protectionist policies or ideologies, the growth rate of the economy, change or shifts in markets, and the like. Macro-factors are generally uncontrollable, and the success of the company depends on adjustability and adaptation to these external factors.

1.2.2 Internal influencing factors

Influencing internal factors for any business are based on the basic values, mission, vision, and objectives of the organization.

Furthermore, there may be specific or general forces at any given time that affect the business environment. Business environments affect companies in different and in their own unique ways.

1.3 Contemporary corporate environment

The contemporary corporate environment presents us with a diversity of businesses. There are small business entities and larger business entities. They may be private, public, and cooperative ventures. The companies exist and develop in multifariously affected environments. They operate in multidimensional spheres having multiple products and services. The dominating business entities which operate in many countries may be called multinationals, conglomerates, and cross-ownerships.

1.3.1 Multinationals

Multinationals are corporates that have operations across a number of countries, for example Sony, IBM, Samsung, Microsoft, and Apple, to name a few.

1.3.2 Conglomerates

These are the organizations which may or may not be multinationals. These are the organizations which own two or more businesses. Over time, such organizations have expanded or diversified their businesses, for example Tata, dealing in steel, automobiles, aviation; Reliance; and others.

1.3.3 Cross-ownerships

These are the corporates having ownership in two or more companies/having stakes or partnerships.

Businesses mainly exist to bring social transformation and social change; it is this transformation which ultimately leads to development. Businesses today are committed to contributing and giving back to the society. They are committed to creating a sustainable competitive advantage. Big multinationals have huge political and economic agendas in the modern world. They constantly battle for market share and mindshare, resorting to non-traditional resources (like knowledge) and innovative means (like quick-response measures).

1.4 Major corporate giants

The increase in conglomerates and cross-ownerships over time has resulted in a consolidation of businesses. Such trends lead to monopoly and oligopoly whereby big became bigger. In prevalent market economies, it leads to a concentration of wealth and hence power in few hands.

In creating the monopolies, dominance, and concentration of wealth in the hands of few, it is technology which has a major role. In contemporary environments, technology is ruling the roost in an unprecedented manner.

For the first time in history, technology is at the helm of the wealth power of corporates, much more than the political and economic powers of countries. This power transcends borders and cultures of the world. This power has the tendency of controlling the national powers in direct or indirect ways, due to the vast spread and assimilation of new information and communication technologies.

1.4.1 Technology giants

The five technology majors/giants are

• Google, owned by Larry Page and Sergey Brin;
• Facebook, owned by M...

Table of contents

• Cover
• Half Title Page
• Title Page
• Copyright Page
• Contents
• List of figures
• List of tables
• Preface
• Acknowledgements
• Part I
• Part II
• Part III
• Part IV
• Part V
• Index