TEXAS SOUTHERN UNIVERSITY

J E S S E H . J O N E S S C H O O L O F B U S I N E S S

Managerial Communication- BADM 630

Professor: Algenita Davis, JD

Nada Guzaiz

Bridget Pollard

Reginald Greer

Thanh Le

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Report Outline

1A- Changing Communication Environment

American business through the years

o Relevance of administrative capitalism to economic activity

o Describe the autonomy of large corporations in the modern market scenario.

o Assess the riskiness of modern businesses and its implications on General Motors

GM through the years

Global Village

o The impact of the technology on the economy

Changing environment for business

o social media

Issues that affecting the organization

Corporate communication connected to strategies

1B- Communicating Strategically

The definition of communicating strategically

o GM teams' strategies of communications

Developing corporate communication strategies

o GM marketing strategy

Determining objectives

Where GM focus (Goals)

Corporate strategic components

o Issues of the stakeholders and shareholders with GM

Compromising on quality

GM business model

2-Corporate Communications Plan including Identity, Image Reputation, and Advertising

Corporate Communications Plan

Brief history of GM

Corporate identity

o Names

o logo

Image

Reputation of GM

Corporate advertisement

Who uses advertising and why?

Social networks are indispensable in communicating to clients and general public.

3-Corporate Responsibility

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Monetary Contribution to Charitable Causes

The Internet and Social Media

Reputation risk management

Environmental Friendliness

Employee Treatment

Corporate Responsibility Reporting

Ethics Training

The Source of Corporate Culture

Constituency Expectations

Staying One Step Ahead of Antagonists

4-Internal Communication

Communicate Up and Down

Communicating Face to Face

Communicate Online

Focus on Internal Branding & Create Employee-Orientated Publications

Communicate Visually & Consider the Company Grapevine

Success with Employees

Communication Audit

Involvement of Senior Leaders

Company Intranet

Internal-External Communication Integration

5-Crisis Communication

Getting Control of the Situation

Gathering as Much Information as Possible

Setting Up a Centralized Crisis Management Center

Early and Often Communication

Understanding the Media’s Mission in a Crisis

Direct Communication with Affected Constituents

Business Must Continue

Plan to Avoid Future Crisis

Legal and Financial audits

Focus on Online Opinions

6- Investor Relations

Annual Reports

Regulation FD

Objectives of Investor Relations

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Individual Investors

Institutional Investors

Strong Media Relations

Analyst Community

Rating Agencies

Internet Usage – Information Transparency

Earning Conference Calls

7- Government Relations

Troubled Asset Relief Program

Securities and Exchange Commission (SEC):

Internal Revenue Service (IRS):

National Labor Relations Board

National Highway Traffic Safety Administration:

Sarbanes-Oxley(SOX) Regulation

Coalition Building

CEO Involvement in Government Relations

Importance of Having a Washington Presence

Lobbying on an Individual Basis

8-Media Relations

Example of GM’s Response to Media and Consumers

Consistent Communication

Conducting Research for Targeting Traditional Media

Researching and Engaging the Expanded “Press”

Responding to Media Calls

Preparing for Media Interviews

Gauging Success

Maintaining Ongoing Relationships

Involve Media Relations Personnel in Strategy

Using Outside Counsel Strategically

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Changing Communication Environment

American Business through the Years (page 1-7)

Administrative capitalism has given the stimulation to new forms of economic activity,

starting with corporate philanthropy. Originally early charitable organizations of America were

founded by entrepreneurs, but soon managers began to imitate their behavior and copied that

what Rockefeller called "business of beneficence” (The Economist, 2006). The adopted

paternalistic policy of the executive directors or presidents of companies, along with guarantees

of job security of "white collars" and generous payments to "blue collars" made the significant

philanthropic contributions. Galbraith (1967, 137-138) in "The New Industrial State” said that

"the result of all of that has been a cacophony of voices, announcing targets of corporation.

However, it would be wrong to dismiss the allegations of social goals, given by

representatives of corporations only as an exercise in competing commonplace. They also reflect

this underlying reality, which shows that the modern corporation has the power to choose their

targets." He further pointed out that large firms can afford to engage in programs and policies

that were not related to their business objectives, as their position in the market has been

relatively stable, and their passive shareholders.

The riskiness of modern business is extremely decreased, and there was nothing more

important for the purposes of General Motors, than to identify and eliminate the dangers to

which the former businessman was supposed to be subject to (Galbraith, 1958). Some leaders

began to see in charitable donations to a form of advertising, which, of course, would strengthen

the corporate reputation. Others felt that their company had the image of the "poor" in society, so

generous charitable donations were needed to improve things.

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GM through the Years

The company was founded on September 16, 1908, in Flint, Michigan, as a holding

company for Buick, and then controlled by William C. Durant. At the turn of the 20th century,

there were fewer than 8,000 automobiles in America and Durant had become a leading

manufacturer of horse-drawn vehicles in Flint, MI, before making his foray into the automotive

industry. GM's co-founder was Charles Stewart Mott, whose carriage company was merged into

Buick prior to GM's creation. Over the years Mott became the largest single stockholder in GM

and spent his life with his Mott Foundation which has benefited the city of Flint. In 1909, GM

acquired the Reliance Motor Truck Company of Owosso, Michigan, and the Rapid Motor

Vehicle Company of Pontiac, Michigan, the predecessors of GMC Truck (Ukessays.com). GM’s

market share peaked in the 1960s where they held 48.3% of the overall US market share. This

total began to decline in the 1970s and continued to present day, due to greater international

competition, mainly coming from the Japanese companies of Toyota and Honda. They strayed

from the traditional American muscle cars, which were bulky and had poor gas mileage, to

sleeker designs with better quality and efficiency.

Global Village (page 8)

"Global village" is a term associated with Canadian-born Marshall McLuhan who described

how the globe has been contracted into a village by electric technology and the instantaneous

movement of information from every quarter to every point at the same time. In fact,

globalization has changed many businesses and flexible working practices, such as remote

working and working from home, can increase business productivity and competitiveness, help

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to reduce transport congestion and pollution, improve workers’ health, and assist disadvantaged

groups.

In addition, The Internet of Things (IoT) was one of the biggest factor which has changed

our cities, home and transportations. The impact of this technology on our economy is expected

to far exceed that of smartphones. One of the biggest beneficiaries of IoT will be your car, which

is becoming a rolling extension of your home. General Motors is now offering 4G connectivity

in many of its vehicles

Changing Environment for Business (page.11)

It is an era of communication and changing information revolution increase the potential of

sharing information across the globe. Government deregulation policies, democratization, and

pluralism encouraged the decentralization of information production from the central corporate

management and replaced it with horizontal people to people line of communication. Now social

media, press, and electronic media become the most popular mean of spreading the messages

among the masses. General Motors (GM) is the largest automobile brand with more than 1.6

million models of compact cars.

If you glance at the Facebook page of General Motors, it seems like business as usual at the

Detroit automaker, even though the company is struggling to cope with the recalls of 1.6 million

cars that it has linked to 12 deaths.

Issues Affecting the Organization (page.13)

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However, due to ineffective communication in the changing communicating environment

and paying less attention towards the effective media handing faces many issues exclusively

safety issues in their automobiles models sold across the world. From last decades, ignition

problem and the alarming rate of accidents that due to automobiles at one region of the world

defame, scare consumers and eventually bankrupt the General Motors (GM). GM did not pay

any attention towards the improvement of vehicles as compared to the competitors that

proliferate in the market and snatch the biggest market share of General Motors.

Corporate Communication Connected to Strategies (page.15)

Large firms have the flexibility to engage in programs and policies that were not related

to their business objectives and policies and the power and autonomy to choose their targets.

There are some ways to communicate your strategy more effectively and help your employees

and encourage behaviors that advance your strategy and improve your results. For example,

keeping the message simple, but deep in meaning. Many organizations have a deep meaning in

their message "why they exist." This tends to influence strategy, decision-making and behaviors

at executive levels, but often isn't well articulated for employees.

Communicating Strategically (page. 29-32)

Communicating strategically is fundamental to strong professional relationships and a

healthy and productive working environment. Explore how to communicate more effectively

with others using targeted strategic-thinking practices, which include thinking conceptually,

imaginatively, systematically, and opportunistically in light of current and future circumstances.

GM company focus on improving communications between their teams and customers. The

teams focus on several areas, including:

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1. Product communications – Executing global product publicity strategies to support sales,

marketing, and promotional opportunities.

2. Corporate communications – Directing news media relations, community and

philanthropic relations, diversity initiatives.

3. Internal, financial, and executive communications – Providing media relations and

communications support for senior executives.

4. Communications operations – Maintaining GM websites, coordinating events, managing

supplier and research communications.

5. Social media – Managing ever-growing online presence and communicating the latest

GM updates to the world.

Developing Corporate Communication Strategies (page. 31-35)

First of all, corporate communication strategy is a term for planning communication

includes employees, customers, suppliers and investors. We can use the framework to build a

better understanding of our company and enhance reputation with people whose actions

influence the success of the business. We need to develop a strong strategic communication plan

which helps to ensure our internal communication function stays relevant and responsive to the

needs of the business.

GM marketing strategy plays one of the most important role to achieve company goal and

objectives. GM is one of the automobile company in the world for manufacturing cars and trucks

in international market. GM segmentation aimed with target of various groups and GM thinks

whole market is single market.GM design cars with different range of cost and design its strategy

according to income, age, family and occupation. Marketing strategy development: Modify the

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company’s U.S product portfolio towards more fuel efficient cars and crossovers. Reduction in

brands name plates and retail outlets to focus available resources and growth strategies on the

company’s profitable operations.

Determining objectives

-Term Investment Value

Where GM focus (Goals)

In order to achieve our goals, GM has remained committed to the following formula for success:

-term results

Give employees more responsibility and authority and then hold them accountable

suppliers to drive our operating success.

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Corporate Strategic Components

General Motors (GM) is a famous American multinational corporation that used

following aspects of a communication strategy to make its image better in the business world.

The communication strategy of the GM utilized corporate strategic components for the success

included corporate advertising, image, reputation, crisis communication, extensive marketing

campaigns, internal communication, social media and society as key elements for the

communication.

The GM team shares a passion for customers and a competitive spirit that drives us to

excellence. Our culture one which represents diversity, inclusion, mutual respect, and

responsibility and understanding welcomes fresh perspectives and varied experiences. Our

212,000 plus employees work in 396 facilities touching six continents, they speak more than 50

languages and touch 23 time zones. Serving as the face of the new GM in communities around

the world, our 21,000 dealers are also important members of our team, and are integral to our

success. However, the biggest issue of the stakeholders and shareholders with GM is, the

company is slow in communication, action, and implementation different essential ideas

inevitable for the growth, rapidly depleting goodwill and image in the automobile market.

Compromising on Quality

Safety is one of the major issues; many automobile companies face that throughout the

world. As the technology grows, more advanced Hi-tech features added to motor vehicles. These

features attract the customers throughout the world, however, side by side it also gives birth to

the quality accessing issue. Compromise on quality or paying less attention towards some

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features can harm to the overall worth and image of a brand. A brand is a combination of

personality, identity, characteristics, and attributes of a person that use it (Kotler, 2003, pp.34).

GM Business Model

Corporate Communications Plan including Identity, Image Reputation, and Advertising

Corporate Communications Plan (page.71)

Stakeholders are a core part of the business such as customers, employees, suppliers,

partners, shareholders, and investors. It is essential to communicate with them through effective

media and expand advertisement campaigns at the global level. Before, passing any statement

about the current situation of General Motors spokesperson should prepare him/herself with an

astute backup of that is requires for the sender to transmit information the receiver at different

regions of the world.

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History of GM

From the last 76 years, GM is the world largest vehicle manufacturer present in the global

automobile industry as a successful brand. It founded in 1908 as holding and investment

company for Buick. William Durant founder of the GM who enable the business to acquire

Rapid Motor Vehicle Company, Cater-car, Reliance Motor Truck Company and Ewing.

Currently, GM has three brand divisions included GMC, Chevrolet, Buick, and Cadillac. GM

also engaged in the socially responsible operations across the globe.

GM now considered as 20th

and 21st century largest motor-vehicle manufacturer. Its

principal products included automotive components, trucks, automobiles, luxury cars and engine.

GM also has quality shares in the car companies included Fiat, Fuji Heavy Industries (Subaru)

and Suzuki. As a result of the recession in 2009 company start downsizing and left with only

four divisions named Cadillac, Buick, GMC, and Chevrolet. However, in the year 2010, it

returned to the stock market as largest IPO in the history of USA (GlobalCarsBrands, 2015).

Corporate Identity (page.72-74)

General Motors (GM) is the largest American automotive multinational company

headquartered in Detroit, Michigan. GM has a great name in reinventing small cars, automobile

innovation, discovering new energy solutions and introducing new designs of luxury cars. It

famous brand included GMC, Chevrolet, Buick, and Cadillac. Due to high investment and focus

on the R&D investment, it exceeds the expectations of people made the Americans proud in the

world.

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Krisher (2014) stated that General Motors (GM) had faced many hindrances from the

year 2004 because thirteen car crash deaths due to ignition problem in their automobile engine.

The National Highway Traffic Safety Administration (NHTSA) had fined General Motors (GM)

of about $3.8 billion because of escalating rate of accidents due to different problems in their

automobiles. GM, CEO Mary Barra directed the employees to find the bone of contention behind

this issue and take immediate abatement measures to get rid of it. Although, the

company had loose a significant number of its customers and underwent through

the bankruptcy in 2009. It biggest growing competitor Toyota cash this situation

and cover the largest market share with its more advanced and eye-catching models of cars.

General Motors takes more than one decade, in the recognition and disbursement of the ignition

problem. These circumstances not only scare customers but also damage the goodwill of

company in the long run.

Name and Logo (page. 82)

GM logo also knows as a mark of excellence also regarded as most memorable and

recognized logo in the car history of the GM. The earliest version of the logo designed in 1966.

However, the use of that logo discontinued in 1970 and current version with simple blue color

introduce under the name of the company logo. The blue color of the logo uses to depict the

trustworthiness of General Motors (GM), while, white color stands for the charm, purity, and

integrity of the GM company. As shown below

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Fig: GM logo

Image and Reputation (page.85-90)

GM considered not only American ,but the world finest automobile manufacturing

company in the world. De Blasio and Veale (2009, pp.77) have stated that organization internal

and external crisis are enough to crash the image and reputation of the business. Corporate

management damages the image of GM through not paying any attention towards the post-crisis

communication with current and potential customers. Discrepancies in the communication

channel resulted in the form of loss of brand image and the business. Relationships between

internal and external stakeholder of the business will be helpful to rejuvenating the image of an

organization (Weiner, 2006, pp4). Downswing, recessions, bankruptcy and safety issues that lead

many people towards death and injuries place drastic effects upon the image and reputation of

the GM.

Corporate Advertising (page.91-95)

Along with the oldest forms of advertising become more common specific types of

Internet advertising - pop-up and rich media. The rich media advertising type integrates

animation and moving image, and why its name. From the consumer's point of view, it is more

spectacle and graphically rich. Recently, this type of online advertising is becoming increasingly

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popular with advertisers due to its visual and informative. It is significant that in 2002, to this

type of advertising often treated not only General Motors and other traditional advertisers, for

example, Coca-Cola, Procter & Gamble, rather than the company of the new economy, leading

their business online and sell their goods and the servants mode online.

Who Uses Advertising and Why? (page. 96)

The reasons that Internet users attracted the attention of advertisers, it is quite clear. The

average web user is much more educated and richer than the average reader or viewer, even in

developed countries. In advertising, there are obvious in the Internet "added value": it makes it

possible to use it as a tool for marketing research. When you visit the Web-site user to the

browser cookie may be transmitted, which allows the identification of the visitor and in the

future. Currently, while the few sites can boast of the fact that advertising revenue is fully or to a

large extent cover their costs. However, the search systems like Lycos, Alta Vista, Yahoo!

already say about the sufficiency of their advertising revenue for the full funding.

GM is a brand behind the brand that pays particular attention towards the domestic and

international promotions. The company uses famous athletes, movie stars, and other celebrities

to symbolize the strength of the brand. GM use media for the advertisement included print,

billboard, electronic and digital. They invest special effort to promote the brand through emails,

Teleconference, newsletters, CEO briefing, Lunchtime meeting, Team meeting, Podcast on

Intranet, Intranet article, Launch event, posters and Notice boards.

Social Networks are Indispensable in Communicating to Clients and General Public.

The communications that exist in social network and blogosphere are usually the reason

of great changes in life of company. The experiences of companies with the using of social

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media (blogs and microblogging, social networking, video sharing, and so on) as a corporate

communication channel on the Internet during the crisis of particular interest to us. For example,

the company General Motors (GM) has used Twitter, Facebook and corporate blogs to inform

interested users about the progress of the procedure of bankruptcy in June 2009. The head of GM

F. F. Henderson, responding to questions about the situation and submit a claim for bankruptcy,

he said his vision of the future of the company (Henderson, 2009). As later he said GM

spokesman, social media has helped the company to establish closer interaction with diverse

audiences and helped to reduce the flow of public criticism (Livingston, 2009).

For media corporate blogs and profiles on social networks are increasingly becoming a

source of information for the preparation of information reports. “General Motors Co. need more

time to eliminate the contradictions with the Canadian company Magna and Sberbank, Opel

claim to purchase", - said GM Vice President John Smith, in his blog on the website of the

company. Information space is fed up with negative information, there is a shortage of news

"with a plus sign" in the markets. Journalists interested in companies that do not turn off the

activity, but on the contrary, say the new plans. News that the crisis cannot attract media

attention because of the high competition in the market in times of crisis can be an excellent

information occasion, especially on the background of the lack of news from competitors. The

economic crisis is the best time to seize the palm of information superiority in the competition

and become an important newsmaker media and industry expert.

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Corporate Responsibility

Monetary Contribution to Charitable Causes (page 111)

Corporate Responsibility (CR) is an important part to sharpen the company’s reputation.

Investors are more likely to invest in companies with great CR history. CR is like a form of corporate

citizenship in which corporations engage in activities to bring in positive impacts to society. An example

is monetary contribution to charitable causes. (. For instances, back in February 2014, The General

Motors Foundation donated $1 million among three Detroit charities the Capuchin Soup Kitchen, Habitat

for Humanity Detroit and the Coalition On Temporary Shelter. Since its inception in 1976, the GM

Foundation has donated hundreds of millions of dollars to American charities, educational organizations

and to disaster relief efforts worldwide, especially in the areas GM operates.

The Internet and Social Media (page 117)

The Internet and social media, as usual, are effective tools for GM to demonstrate and even

promote its CR progress. In fact, online GM Foundation outlines 3 main categories of GM Community

Outreach. First is the area of sustainability. By 2020, GM sets the goal to reduce carbon intensity from

facilities by 20 percent and to promote the use of 125 megawatts of renewable energy over 2010

threshold. GM also aspires to be a completely zero-waste manufacturer by operating 122 landfill-free

facilities globally. This number is targeted to increase to 150 by 2020. The second area is the safety area.

GM currently supports three big Safety programs: Safe Kids Buckle Up, National Safety Council on

Teenager’s Driving, and Mothers Against Drunk Driving. The third area is STEM education. GM

continuously show supports for students and organizational institutions in Science, Technology, Engineer,

and Math field. GM has been big endorsement for Society of Automotive Engineer (SAE), Buick

Achievers Scholarship Program, and University Partner Program.

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Reputation risk management (page 118)

Reputation risk management is also an important part of CR. GM has developed a culture of

“doing the right thing”. For example, after the ignition switch recall, GM has made itself responsible for

the mistakes. They promptly and sensitively reimbursed all the affected victims. More importantly, they

promote more attention to quality and manufacturing process. They also encourage employees to speak

out for the potential errors or malfunctions within car design and manufacturing.

Environmental Friendliness (page 131)

Being environmentally friendly is also another way to increase CR value and boost cost-saving

benefits. For example, in 2015, GM ended the use of coal as an energy source in North American plants,

as it continued to invest in renewable energy. GM sets to achieve 10% of renewable energy use for North

American operations by the end of 2016. GM also maintains 5,000 acres of wildlife habitat at our sites,

along with an industry-leading 43 habitat programs certified by the Wildlife Habitat Council. These

grounds have served as outdoor classrooms to engage students and communities.

Employee Treatment (page 128)

A company can’t meet its sustainability or reputation goals without smart strategies to incorporate

employees. In fact, GM has taken serious actions to improve the well-being of the employees. GM offers

health insurance, training, and career-development programs to all levels of employees. It also develops

codes of ethics to promote internally responsible behaviors. In essence, employee treatment is at the core

of corporate responsibility, as employee is a brand ambassador for corporation’s identity.

Corporate Responsibility Reporting (page 137)

A good CR report provides metrics (solid CR efforts and results) for stakeholders to verify the

claims and the realities of corporate behaviors. Furthermore, a good CR report also appeals to the full

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range of a corporation’s constituencies, providing both quantitative and qualitative evidence of CR

efforts. An example of quantitative result is GM sets the goal to reduce carbon intensity from North

America facilities by 20 percent, by 2020. Additionally, CR report needs to disclose bad performances

and provide strategies for improvement. For example, GM constantly mentions about their recalls in CR

reports and about plan to repair malfunctions and to correct future manufacturing.

Ethics Training (page 127)

Employee’s performance is at the heart of company success. Therefore, GM has taken crucial

steps to provide employees with resources. For example, GM has provided ethics training to prepare

employees for dilemmas. This is important to keep a corporate culture aligned with strong values of

successful corporate citizenship. In fact, in 2012, former GM CEO Dan Akerson created a document

called “Wining with Integrity” which outlines ethics policy for employees. GM employees have been

asked to sign such ethics policy. They are informed and obligated to act ethically, such as keeping internal

corporate information confidential.

The Source of Corporate Culture (page 126-127)

A strong, values-based culture can contribute to corporation’s competitive edge, increasing

employee pride and loyalty. In order to build such strong culture, the positive tone must be set from the

top. The previously mentioned of “Winning with Integrity” ethics policy, from GM’s former CEO Dan

Akerson, is an example of top management’s commitment to building a workplace of integrity. Such

commitment will set the standards for all subordinates to follow. Slowly, it becomes a culture.

Constituency Expectations (page 134)

Successful CR strategy requires information transparency and especially tracking-

responding to constituency expectation. In 2012, in GM’s first post-bankruptcy sustainability

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report, it showed strong commitment to offering vehicles and services to solve these challenges

while meeting customer needs. For example, GM offered Chevrolet Volt as an environmentally

sound, fuel-efficient, and transformational vehicle, amid economic downturn. GM went on to

conduct ongoing customer satisfaction surveys. Through this way, GM could identify whether

their vehicle choices were aligned with customers’ expectations or not.

Staying One Step Ahead of Antagonists (page 139)

Corporation should keep close attentions to critics and other constituents to gauge

existing opinions and spot potential trouble brewing well in advance of CR crisis eruption. For

example, amid the peak of ignition switch recall and pressure from multiple constituents, in

March 2014, Mary Barra, the CEO, made a video to express apology to the consumers and to

update progresses, such as internal review, design scrutiny, governmental investigations, and

especially willingness to set aside $300 million for expenses to repair malfunction vehicles. Such

action presented the bad with the good to show that GM’s corporate citizenship was still

prioritized.

Internal Communication

Communicate Up and Down (page 181)

Internal communication is about strengthening the relationship with an organization’s

employees to have a better work environment. It should be the responsibility of the internal

communication professionals to provide superiors with information, tools, ongoing support that

they need to present news to their direct reports. In fact, General Motors hired Steve Harris in

1999 as VP of communications. At this time approximately 202,000 employees did not have a

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way to voice their options about the cars. This caused the proper actions not to be taken to fix the

ignition causing a recall due to a faulty ignition switch that could cause the engine and electrical

system to shut off, and disable the air bag. Line management should communicate with the

employees to ensure better operations.

Communicating Face to Face (page 182)

At GM, Managers and supervisors have meetings face to face with employees to have a better

relationship. This holds true through all levels of the corporation: from executives, mid-level

managers, designers, engineers, payroll specialists, to assembly and warehouse workers. At GM,

these meetings are held at both large-scale events and small group settings. Large-scale events

are mostly charity drives and community services which aim at strengthen bonding among all

levels of GM Corporation. Smaller group face-to-face meetings are usually held at departmental

levels to share feedbacks and opinions on respective operations and initiatives.

Communicate Online (page 183)

The recall stemmed from over 300 deaths as a result of the ignition failure and is estimated to

cost General Motors $300 million in repairs. As the recall was coming out the CEO Mary Barra

did follow the golden rule of crisis management. She communicated to her employees through

email about what the company was about the recall first before talking to the media to make sure

she expressed what was going on to her employees so they did not hear it from outside the

company. By doing this companies will build support from their employees instead of alienating

them. On March 4, Barra sent a letter to employees that stated, “Our company’s reputation won’t

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be determined by the recall itself, but how we address the problem going forward.”

Communications with your important audiences can help you focus on branding in knowing that

your employees have your support.

Focus on Internal Branding & Create Employee-Orientated Publications (page 184)

General Motors CEO Mary Barra expressed to the media that internal communication is to blame

for the long period of time before GM issued a recall on vehicles. General Motors has fired four

executives as a result and shows how they are rebranding the company by accepting the blame

and fixing the problem. Barra has since organized the Speak Up for Safety program which

employees can speak up and the safety concerns they have and give recognition to employees

that make cars safer. She spoke at an employee town hall meeting stating “GM must embrace a

culture where safety and quality come first,” Barra said. “GM employees should raise safety

concerns quickly and forcefully, and be recognized for doing so.”

Communicate Visually & Consider the Company Grapevine (page 186-page 187)

GM is working on communicating visually throughout the levels of management. The CEO

makes webcasts to employees to recognize how they are contributing to the success of the

company. They also have employee of the month to recognize individual success with

employees.

General Motors is a grapevine company. There are thousands of GM franchises. The individual

owners all report to GM. During the crisis owners were told that they to fix ignition switches to

all cars on the recall list. GM also let the owners know of the crisis so they had to prepare for the

decline in sales and some dealerships even had to close.

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Success with Employees (page 179)

There are many ways to succeed with employees. First way is the continual improvement in

communication. For example, GM‘s Speak Up for Safety program through which employees

receive recognition for speaking up about the manufacturing safety concerns. Besides, there are

seven other ways: open exchanges of information, clear materials, timely distributions, trusted

sources, two-way feedback systems, senior leadership’s interest, and consistent messaging across

sources

Communication Audit (page177)

GM technicians saw the problems with the cars but management did nothing to change the

problem. Steve Harris wanted to help with the communications with employees and management

so he brought in Gary Grates as the head of internal public relations. He did a communication

audit that helped General Motors recognize their flaws.

Involvement of Senior Leaders (page 189)

Senior leaders are very important in the international communication process. They are the

culture carriers and the visionaries for organizational strategies and operations. At GM, Tony

Cervone, Senior Vice President of Global Communications directs front-line and senior

managers to make constant physical presence and interaction with employees. Through this

way, a sense of shared culture and responsibility are established among managers and

employees. They also work closely with internal communication professionals to ensure

corporate messages are effectively received and understood by all employees

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Company Intranet (page 184)

A company intranet needs to be dynamic and engaging, so it becomes employee’s go-to source

for latest company information. It can become the most effective tool to engage employees.

Therefore, GM has developed an extensive intranet https://gmid.gm.com/gmidStatic/. It enables

GM employees across the globe to access to latest corporate news and as well as technical

specifications and contents.

Internal-External Communication Integration (page 180)

Regardless of where the internal communications is positioned and whether or now an outside

consultant is used, it must work closely in conjunction with external communicators to integrate

messages delivered to both internal and external audiences. At GM, before news about company

hits the press or appears on the Internet or their Social Media hub, GM employees are already

informed about company’s own version of the story. Through this way, GM managers and

employees show consistent positions to other constituencies.

Crisis Communication

Getting Control of the Situation (page 270)

The effectiveness of crisis communication is truly tested by how General Motors deals

with problems when they occur (page 269). Methodology of communication during the crisis is

an eight-step process. The first step is getting control of the situation. Such control includes

defining the real problem and then establishing measurable responsive communication

objectives. For example, earlier in April 2016, GM recalls 895,232 vehicles of 2014-15

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Chevrolet Silverado and GMC Sierra 1500 pickups (inside the US), due to seat belt malfunction.

This problem was detected by warranty data which shows that the flexible steel cable connecting

the seat belt to the vehicle can fatigue and separate over time as a result of the driver repeatedly

bending the cable when entering the seat. In addition, this early detection enabled GM to notify

customers in timely fashion and to establish helpful communication means with them. For

example, GM utilized https://my.gm.com/web/portal/ownercentert to let customers to lookup

their Vehicle Identification Number (VIN) to determine whether their vehicle(s) are subject to

recall. Furthermore, getting control is also to have corporate communication department to

establish clear internal and external communication channels and to develop appropriate crisis

teams.

Gathering as Much Information as Possible (page 270)

The second step is gathering as much information as possible. In this step, GM was

indecisive, slow, and even ignorant. The faulty ignition switch recall intensified during 2013-

2014 period, but it really started back in 2003. By the end of 2013, the faulty ignition switch was

the reason for at least 31 crashes and 13 deaths. GM should have quickly gathered information

and analyzed malfunction right from the first incident in 2003. However, GM hesitated and did

not report the ignition switch defect. Consequently, in May 2014, National Highway Traffic

Safety Administration (NHTSA) brought up a record $35 million civil penalty for GM. Beside

government, GM also faced harsh treatment from another two constituencies: customers and

investors.

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Setting Up a Centralized Crisis Management Center (page 270)

The third step is setting up a centralized crisis management center. For the case of GM, it

set up a thorough centralized online crisis management center. It includes extensive archives of

news and stories of all sensitive topics, such as design, quality, and safety

http://www.gm.com/all-news-stories/safety.html. It also includes comprehensive owner

assistance section for all GM models. Information ranges from maintenance/ service schedules,

accessory compatibility to recall updates, and etc. In addition, GM also developed consistent

social media tools, such as Twitter, Facebook, Feed, Youtube, and etc. to deliver prompt

messages and improve customer experience. During any crisis, such centralized and convenient

platforms enable fast and effective communication between GM and the constituencies, such as

media, investor, customers, government agencies, and etc.

Early and Often Communication (page 270)

The fourth step is early and often communication. Companies must avoid silence and

delayed responses. In addition, companies also have to communicate values, such as concern for

public safety, and to show the commitment to assisting people affected by the crisis. For

example, in May 2014, the five safety recalls GM announced was the excellent precautionary

communication that prevented potential crashes and fatalities from malfunctioning tail lamps,

headlamps, and brakes. In addition, Jeff Boyer, Vice President of GM Global Vehicle Safety

delivered the following positive comments: “Customer safety is at the heart of how GM designs and

produces vehicles, and these announcements are examples of two ways we are putting that into

practice. We have redoubled our efforts to expedite and resolve current reviews in process and also

have identified and analyzed recent vehicle issues which require action. These are examples of our

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focus to surface issues quickly and promptly take necessary actions in the best interest of our

customers.”

Understanding the Media’s Mission in a Crisis (page 272)

The fifth step is to understand the media’s mission in a crisis. Traditionally, media sources

delivered the stories at a “lightning” speed to look for an ideal story of victim, villain, and visual. The

key part of the story is the visual, as it can help companies to counteract tampering claims. Amid

recent recall and safety concerns, GM has launched the series of “Precision Matters” advertisements.

The theme centers around precision and attention to detail by professional athletes, such as San

Francisco Giant pitcher Jeremy Affeld or Golden State Warrior Harrison Barnes. Such precision

translates into “Professional Grade” of engineering design, safety design, and technological

advancement. Such positive images slowly push away negative criticisms and perceptions from

past crises.

Direct Communication with Affected Constituents (page 272)

The sixth step is to communicate directly with affected constituents. Beside the delayed

ignition switch disaster, GM has successfully and promptly notified the consumers of recalls

through official news releases, social media coverages, and even physical mailings. It even set up

dedicated phone center that handled only recall matters from constituents. GM also wisely made

responsive public relations movement to protect its reputation. For example, amid the peak of

ignition switch recall, in March 2014, Mary Barra, the CEO, made a video to express apology to

the consumers and to update progresses, such as internal review, design scrutiny, governmental

investigations, and especially willingness to set aside $300 million for expenses to repair

malfunction vehicles.

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Business Must Continue (page 272)

The seventh step is to remember that business must continue. In other words, companies

must simultaneously resolve the crisis and operate other business functions. It ensures business

can continue to generate revenue, despite crisis. The magnitude and the effects of crisis must be

contained so that it minimally affected other business functions. For example, during the 2013-

2014 crisis of ignition switch of smaller models, GM was also keen on delivering their

advertisement campaign on the fuel efficiency of GMC Sierra Pick-up Trucks. Consequently,

sales of pick-up trucks recovered and even increased in domestic market.

Plan to Avoid Future Crisis (page 273)

The eight and last step is to make plan to avoid another crisis immediately. In fact, corporate

communication executives should work with other managers to implement changes to lower risks of

foreseen crises. For example, in April 2014, GM initiated the Speak Up for Safety campaign. It was to

encourage and to recognize employees for ideas that make vehicles safer and for speaking up when they

see something that could impact customer safety. GM also announced that two GM engineers had been

put on paid leave as part of ignition switch investigation. Such campaign would improve internal

operation and product quality. Consequently, it would prevent product malfunctions and recalls.

Legal and Financial audits (page 267)

Beside these eight primary steps, companies also need to conduct legal and financial audits of

threats and liabilities. Such forecast is important so that companies can position well to minimize

liabilities through early actions. For example, in April 2014, GM hired Kenneth Feinberg and former U.S.

Attorney Anton Valukas to consult crisis-management efforts. Kenneth Feinberg is an attorney

specializing in corporate payouts. He handled the compensation payouts to 9/11 and BP oil pill incidents.

He would help GM to explore and evaluate options in responding to families of victim. He designed

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different payout options to eventually reduce financial liabilities for GM. He also helped GM to forecast

$300 million dollar compensation budget. In addition, Anton Valukas helped GM to deal with civil and

criminal charges from government agencies and committees. Such expertise could help GM to “control

what they can control”, with regard to legal and financial liabilities.

Focus on Online Opinions (page 258)

The final touch to the crisis communication is the focus on online opinions. Internet has been used to

create anti-corporate and anti-brand “communities” in which people can share grievances and criticisms

about companies. Websites, such as gm-trucks.com, gmforum.com, or gminsidenews.com, have been

“notorious” at posting negative comments about GM products and recalls. To negate this trend, GM

offered its own web-based forum for customer feedback and complaints. Most noticeably, it has

integrated fast-paced and consistent social media platforms, such as Twitter, Facebook, and Youtube, to

quickly respond to customers’ feedback and complaints and to promptly announce important messages.

Investor Relations

Annual Reports (page 210)

Annual reports have played an important role in shaping corporate reputation and public

perception. Therefore, General Motors has also been diligent at making these reports accessible. In

specific, from its office website’s Stockholder section, it includes archive of the four most recent annual

reports (2012, 2013,2014,2015). Each report was detailed with objectives, goals, performance,

achievements, and guidance for future operations.

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Regulation FD (page 205)

In October 2000, the Security Exchange Commission-proposed Regulation Fair Disclosure

(Regulation FD) became effective. It eliminated the practice of company executives sharing non-public

information with security analysts by requiring parallel public disclosure of this information. This is why

GM developed an extensive online database that is accessible to public. It features investor news, earning

releases, announcement and events, stock information, analyst coverage, historical dividends, stock

repurchase program, corporate strategy, and etc. These data helps investors make more informed

decisions whether to invest in GM.

Investor Relations Framework:

Objectives of Investor Relations (page 199)

The main objectives of Investor Relations are to explain the company’s vision and strategy to

potential investors and intermediaries such as analysts and media; to ensure expectations of company’s

stock price are appropriate for its earnings prospects, the industry outlook, and the economy; and to

reduce stock price volatility. These objectives are easily carried out by constant updates of corporate/

investor news, such as monthly sales update, new officer appointment, quarterly earnings, dividend

declaration, new product launch, or new business acquisition.

Individual Investors (page 200)

Individual investors require substantially less detailed information due to their relative lack of

sophistication but require main information such as stock split, dividend announcement, quarterly

earnings. According to the most recent 13F filings, individual ownership of GM capital stood at 24.18%

with roughly 491 million shares outstanding, valued at 11.82 billion dollars.

Institutional Investors (page 200-201)

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Institutional investors are typically pension funds, mutual funds, insurance, companies,

endowment funds, and banks). They also hold majority of capital funds for the stock. In case of GM,

according to the most recent 13F filings, institutional holding was at 75.82%, with 1014 holders,

1,167,500,678 shares, and over $37 billion in values. In fact, IR professionals will use databases to

analyze trends on institutional holdings and characteristics matching with GM’s PE ratio and industry

classification. Afterwards, these institutions would be contacted through either day-to-day phone contacts

or personal meetings to maintain long-term relationship.

Strong Media Relations (page 203)

Having strong media relations is also an important part of investor relations. Popular medias, such

as Wall Street Journal, Forbes, Times, CNBC, Reuters, Bloomberg, CNN, and etc. are prioritized by GM

to maximize access to media outlets and ensure consistency in messages delivered to media. In fact, GM

has developed a specialized social media hub that tracked all media coverages to ensure consistent

communication.

Analyst Community (page 204)

With the analyst community, there are Buy-side and Sell-side analysts. Buy-side analysts work

for money management firms, such as mutual funds or pension funds, to research companies for addition

into investment portfolios. Sell-side analysts cover stocks within certain industries to generate detailed

research reports, offer specific recommendations “buy”, “sell”, or “hold”, and provide price targets. The

latest broker reports on Friday 8th of April state 5 analysts have a rating of “strong buy”, 5 analysts

“buy”, 9 analysts “neutral”, 1 analysts “sell” and 0 analysts “strong sell”

http://www.risersandfallers.com/2016/04/08/analyst-coverage-general-motors-company-nysegm/. In

addition, on February 5, 2016, Deutsche Bank had a $34 price target for GM. These provisions are

constantly updated, according to company situations.

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Rating Agencies

Rating agencies are also part of Intermediaries. Popular agencies in the US are McGraw Hill’s

Standard & Poor (S&P), Moody’, and Fitch Ratings. Ratings from these agencies are constantly

changing, based on performance of company. For example, in June 2015, Fitch rating brought GM's

credit ratings to, BBB-, an investment grade. It cited a "fundamental improvement" in the company's core

business over the past several years as one of the reasons for the upgrade.

Internet Usage – Information Transparency (page 197)

In terms of communication, Internet enables greater transparency to all investor relations

functions. As mentioned above, GM has built extensive online investor relations resources. They range

from daily investor news, earning releases, key events, sustainability reports, stockholder information,

SEC key fillings, sales, stock information, analyst coverage, historical dividend, stock repurchase

program, inside trading disclosure and etc. Noticeably, the transparency results from Sarbanes-Oxley

legislation which aimed at enhancing financial disclosure, auditing independence, and fraud prevention.

Earning Conference Calls (page 197)

Quarterly earning conference calls become a norm within the investor relation spectrum. Within

these conference calls, GM executives summarized activities, performance, financial results, and

guidance for quarterly earnings release. The latest GM Quarter 1 Earnings Conference Call was hosted on

April 21st, 2016 to discuss and answer questions from investment community The conference call was

attended by Randy Arickx, GM Investor Relation Director; Mary Barra, GM CEO, Chuck Stevens, GM

CEO, and senior analysts from Bank of America, Citibank, RBC, Goldman Sachs, Deutsche Bank,

Barclay Capital, Morgan Stanley, UBS, and JPMorgan Chase community. Besides, GM also plans an

annual meeting for shareholder on June 7, 2016.

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Government Relations

Troubled Asset Relief Program (page 221)

GM, on the brink of bankruptcy, benefited from TARP program. In fact, Treasury Department

bailed GM out by pouring in significant funds. In the end, GM bail out’s funds lost $11.2 billion.

However, GM avoided liquidation and reorganized in a 2009 bankruptcy that had given new life

to the company.

The Reach of the Regulatory Agencies (Page 223)

It is imperative that corporate institutions and government maintain a significantly close

relationship, seeing as how they are interdependent upon one another in many ways. Today there

are many government regulatory systems that are put into place to oversee corporate institutions.

GM is primarily affected by the following agencies:

Securities and Exchange Commission (SEC): Sets the standards for corporate

public financial reporting, the rules for investment, and the regulations for securities

exchanges.

Internal Revenue Service (IRS): Handles all tax reporting, tax accounting, tax

collection, and pretty much all taxation issues other than actually determining the tax

rates.

National Labor Relations Board: It is a governmental agency which is in charge

with conducting elections for labor union representation and with investigating and

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remedying unfair labor practices. It ultimately provides collective bargaining protected

rights for labor unions.

National Highway Traffic Safety Administration: It is in charge with writing

and enforcing Federal Motor Vehicle Safety Standards as well as regulations for motor

vehicle theft resistance and fuel economy. It builds the Fatality Analysis Reporting

System , maintained by the National Center for Statistics and Analysis, as a resource for

traffic safety research

Sarbanes-Oxley(SOX) Regulation (page 222): It was titled as the Public Company

Accounting Reform and Investor Protection Act. It was designed to strengthen the effectiveness

of audit independence and requirements to improve accuracy and reliability of corporate

disclosure

Coalition Building (Page 228)

Although these systems are put into place to regulate corporate institutions, many of them are

able to evade certain regulatory systems by establishing a close relationship with the

government. For instance, General Motors is almost free from taxpayer ownership, due in part to

the governments’ bailout program, established back in 2008 that allowed GM to bounce back

from one of Americas worst financial crisis situations since the Great Recession. The U.S.

government spent $11.2 billion on its bailout of General Motors, more than the $10.3 billion the

Treasury Department evaluated when it sold its remaining GM shares.

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CEO Involvement in Government Relations (Page 229)

The government felt it had to do something about GM’s financial situations because the

automotive industry is one of the world’s leading revenue operators a country can have. GM

alone operates in 7 different countries and has employed over 250,000 people in total, this keeps

the countries unemployment rate down and saves the government money when it comes to health

care as well as generate tax revenue from taxpayers, that the government can use to help its

country growth as far as school, highways, infrastructure, crisis situations, and anything else the

country might need.

Importance of Having a Washington Presence (page 226)

It is important for government relations departments to have a constant Washington presence.

Such presence can improve corporate effectiveness by studying methods of other companies,

hiring consultants, organizing popular support, learning to use the media properly, making

alliances, creating political action committees, and establishing connections with influential

Washington insiders. In fact, GM has always put great emphasis on this spectrum. They have

hired top lawyers such as Bob Ferguson or Craig Glidden to oversee public policy, corporate

sustainability, legal compliance, and lobbying efforts.

Lobbying on an Individual Basis (Page 229)

Corporate institutions and government rely heavily upon each other and the government is not

only in it for the money. When it comes to the automotive industry, the government set the

standards high as far as what the industry can do when it comes to one’s safety. The government

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has implemented many rules/regulations that say what has to be standard in every vehicle as well

as the different safety and road test a vehicle must pass before it is able to be sold in its country.

Media Relations

Example of GM’s Response to Media and Consumers

In February 2014 General Motors had to recall over 800,000 of their vehicles because of faulty

ignition switches. Today, the company has recalled nearly 28 million of their vehicles with 24.6

million being right here in the U.S. In the past year, due to the recall, the company and its

affiliates has suffered greatly. After investigation, GM determined that problem was due to the

ignition not having enough torque to keep the ignition from turning off, or as many automotive

makers would say, there was a problem with the “switch detent plunger”. As result many GM

vehicle owners lost their lives and some took on great losses. Followings were how GM

responded to the media and to the consumers.

We would like to send our condolences to those families and want them to know that GM plans

to compensate those families accordingly. In order to better deal with the negative views from

the media, we have implemented the following procedures to address the media, as well as our

consumers.

First: we will establish a quick response team that will address the recall in the media. Our

response team will address the issues in a matter of who, what, when, where, and why.

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Second: we plan to compose a “media list”, which will consist of different media outlets that

will allow us to effectively and quickly relay our company’s information to the public. In doing

so, this will allow us to build strong relations with the media and as well as create a relationship

with their consumer base.

Third: we will integrate family safety in our media campaigns. This will rebuild our customers

trust and reopen our market base for a broader customer base.

Consistent Communication (page 151)

Our ultimate goal is to maintain consistent communication to those affected, as well as those

who could be affected, to keep them informed on what has happened and GM’s plan to fix the

problem and guarantee their safety moving forward. Our focus is to ensure that the negative

effects of the recall doesn’t impact our company’s reputation moving forward. By recreating

GM’s image with our newly focused family first mission, we plan to broaden and thrive in our

customer base.

Conducting Research for Targeting Traditional Media (page 150)

Senior managers working with the members of the corporate communication department

determine what objectives they have for a certain story. Next, the corporate communication

professionals conduct research to find out who covers their industry and the company

specifically. In addition, they need to determine what type of reporters they are dealing with,

what contents and points of views journalists tend to write, and what type of analysis for each

call coming in.

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Researching and Engaging the Expanded “Press” (page 152)

Identifying influential media in the online space, such as namely bloggers, online communities,

social media outlets, and citizen journalists, is very important. For example, corporations need to

identify influential blogger communities and then effectively engage with them. It helps

corporation to accordingly invest in web-based communication platforms to bring right targets of

expanded “press” to key constituents.

Responding to Media Calls (page 153)

The rule of thumb is to “Never Say No” to the media calls. In fact, companies can strengthen

their relationship with the media through the way they handle requests for information. In fact,

GM has spent big on staffing a media relations department with enough personnel to handle

incoming calls from the media. The person who takes the call should try to find out what angle

the reporter is taking on the story. In addition, responding to the media calls in a timely manner

is especially critical, given the fast-pace online channels.\

Preparing for Media Interviews (page 154)

Employees should be given a short briefing on the reporter’s or producer’s prior work, using

examples gathered in the research phase. Through this way, they can develop a clear

understanding of reporter’s point of view. Next, they should be given a set of questions that the

reporter is likely to ask. These questions can be developed from what the communications staff

member working on this interview has gathered in previous conversations with the reporter, from

an analysis of the reporter’s work, and from what seem to be critical issues on the subject.

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Gauging Success (page 156)

A sophisticated approach to the media monitoring and media relations can:

Identify which communication activities create the most value in terms of specific

business outcome

Evaluate how well an organization’s various communication functions perform against an

industry average

Demonstrate the total value created by a communication department in terms of one or

more business outcomes

Drive strategic and tactical decision making in the communication function, hedging

reputational risk and managing major events such as mergers and top management

changes

Highlight actual corporate value created by communication activities

Maintaining Ongoing Relationships (page 157)

Building and maintaining a network of contacts with the media is important for generating

coverage. In more specific, organizations need to work to develop long-term relationships with

the right reporters for their specific industry. For example, annual meetings between key

reporters and CEOs can build goodwill and credibility.

Involve Media Relations Personnel in Strategy (page 159)

It is absolutely necessary to avoid last-minute preparation for media-relations activities. In fact,

senior corporate communication executives need to involve in the decision-making process. The

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can clarify pros and cons of each situation to the employees, and they can make communications

professionals feel more ownership for the ideas that they need to present to the media.

Using Outside Counsel Strategically (page 160)

GM develops in-house media-relation capabilities, along with the boost of external arsenals. For

example, GM outsources a number of aspects of its digital media needs, including Search Engine

Optimization (SEO), social media measurement, and content production. With more focus and

expertise, external resources can help GM communicate important messages in the most creative

and effective ways.

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