Downsizing as a communication challenge: comparing CSR and corporate branding

Rita Järventie-ThesleffOctober 27, 2011

Amsterdam

1. Overview and objective2. Theoretical framework3. Research setting and data4. Analysis5. Conclusions

Agenda

1. Overview and objective

CSR and corporate branding form two partly synergistic, partly competing strategic discourses that both express and guide the way the members of the organization should behave towards the stakeholders of the company. The purpose of the paper is to shed light on the distinct discursive practices involved in legitimizing controversial organizational undertakings within the strategic discourse of corporate social responsibility (CSR) and that of corporate branding

2. Theoretical frameworkBranding

– Hatch and Schultz (2001; 2003) see corporate branding as a strategic tool, with the help of which organizations should strive at alignment between the strategic vision, organizational culture and corporate images. Corporate social responsibility

– CSR can be defined as a ‘conduct of a business so that it is economically profitable, law abiding, ethical, and socially supportive’ (Carroll 1999: 286). Legitimacy

– Suchman’s (1995, p. 574) definition on legitimacy: ‘a generalized perception or assumption that the actions of an entity are desirable, proper or appropriate within some socially constructed system of norms, values, beliefs and definitions’.

2. Strategy-as-discourseThe study builds on the recent research on strategy-as-discourse and discursive legitimation in order be able to identify and elaborate on the distinct discursive practices that mediate the way the restructuring news were internally legitimised in CSR and in corporate branding.

3. Research setting & dataBasico: a transnational B-to-B company operating in a technology driven and capital-intensive field.A major player in its field having several production units and an extensive sales network outside its home country. A five-year longitudinal case study of Basico’s corporate brand building process. Focus on the last year, when the company was forced to announce a decision to curtail its production capacity and, consequently, to reduce personnel. The empirical data consists of both corporate brand and CSR related documentary and archival material and 24 personal interviews with senior management of the company

4. Analysis: CSR and the practice of ‘Imposing shared responsibility’

1. Basico aimed at establishing comprehensibility to its endeavours– Basico was portrayed as a rational decision-maker that relied on hard

facts and objective information. The company was confronted with changed operating environment and it needed to act2. Restructuring decisions were the right thing to do.

– Any type of confrontation with the employees was avoided and the communication embraced the joint, good-faith efforts of the entire personnel in improving the situation. 3. Showing empathy and responsiveness to the situation

– Arguments were used as a means to undermine the critics for the restructuring actions and to alleviate the social harm

4. Analysis: Corporate branding and the practice of ‘Averting irritation’

1. The restructuring and downsizing decisions were perceived to represent a crisis of meaning to the corporate brand2. There was clear willingness to avoid cynical interpretations of the corporate 3. The avoidance of cynical interpretations led to partial retraction of support to the corporate brand-building project– Continuous visibility and good follow up of local implementation schemes. We

should not let it go now. There is a tremendous pressure on every employee to outperform and then one tends to forget our brand value and behaviour. (Feedback questionnaire 2006)

5. Conclusions

1. The discursive practice of Imposing shared responsibility aimed at legitimizing the restructuring and downsizing decisions in the CSR communication. This practice rested on the philosophy of co-mourning and co-suffering. CSR communication acted as a reflection of company conscience: the unfortunate undertakings were confessed, after which the company and its employees were expected to strive for a ‘better future’. 2. Overall the downsizing and restructuring decisions posed a challenge to the legitimacy of the corporate brand related communication. Corporate branding was perceived to rest on positive and self-confident sales and marketing speech. The downsizing did not seem to be congruent with the corporate brand promise thus leading to a discursive practise of legitimation that was labelled as Averting irritation.

5. Conclusions

The purpose of the paper was to shed light on the distinct discursive practices involved in legitimizing controversial organizational undertakings within the strategic discourse of corporate social responsibility (CSR) and that of corporate brandingThis research illuminated the internal legitimation challenges that an organization faces when communicating restructuring and downsizing decisions and highlights the distinct nature of CSR and corporate branding as strategic tools for obtaining legitimacy from internal stakeholders.