The Alignment Factor: How to Link Up All Stakeholders in Order to Achieve Business Excellence
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Books
Strategy Documents
L0 1/2012
Reputation
The Alignment Factor:
How to Link Up All
Stakeholders in Order
to Achieve Business
Excellence
What determines the success of corporate strategy? What are key success factors
from the viewpoint of managing intangibles? Should one take into account
only clients and shareholders when developing the corporate strategy, or should
employees, suppliers, regulators and the societies also be involved?
In order to win, one has to align. Such is the reputation. The best strategy may fall through if it is
conclusion made by Cees B. M. van Riel, Professor not supported by key stakeholder groups.
of Corporate Communication of the Rotterdam
School of Management and Vice Chairman of This statement is illustrated with numerous
the Reputation Institute, in his book titled The examples of multinational companies such as
Alignment Factor (“Alinear Para Ganar” in its Unilever, Deloitte, ING, Google, Southwest
Spanish translation). The book highlights the Airlines, IBM, Philips, Ikea, Toyota, McDonald’s
need for support on the part of stakeholders in or Nestlé, as well as many Spanish companies, for
order to enter different markets, obtain operating example Telefónica, BBVA, Santander, La Caixa,
licenses and minimise potential obstacles. Iberdrola, Repsol or Gas Natural Fenosa.
The message is clear: alignment of different business
units and departments of an organisation, as well The importance of internal
as alignment of the corporate strategy with the – external alignment
expectations and interests of the stakeholders Luis Abril, Chairman of Corporate Excellence,
is the key tool at present for building excellent believes that today, in the context of the reputation
This document was prepared by Corporate Excellence – Centre for Reputation Leadership and among other sources contains references to
research of Cees B. M. van Riel, Professor of Corporate Communication at the Erasmus University Rotterdam Business School and Vice
Chairman of the Reputation Institute, and comments of Luis Abril, Chairman of Corporate Excellence – Centre for Reputation Leadership
and General Manager and Chairman Chief of Staff of Telefónica, and Ángel Alloza, CEO Corporate Excellence – Centre for Reputation
Leadership, made during the presentation of the book “Alinear para ganar”, the first title in the Corporate Excellence Library published by LID
publishing house. The presentation was held at EOI Business School in Madrid, on April 19, 2012.The Alignment Figure 1: Perspectives on identity issues (external stakeholders). This is because according
Factor: How to Link to van Riel alignment with internal stakeholders
Up All Stakeholders
in Order to Achieve ensures better results: alignment improvement by
Business Excellence Desired 10% leads to a 6% increase in satisfaction and a 2%
identity
increase in business results.
Perceived Projected
“Reputation is built from
identity identity
within, starting with the
Source. Van Riel, Cees (2012): The Aligment factor,
employees, and is achieved
through coherence of
economy, it is possible to achieve prestige and
identity, values, brand,
recognition by projecting a coherent message onto communication and
the society, thus aligning internal stakeholders
(employees and shareholders), as well as external
reputation”
stakeholders (suppliers, clients, regulators and
In this sense, the behaviour of the employees and
associations) with one’s corporate strategy.
their alignment with corporate objectives that goes
beyond formal commitment and connection with
Ángel Alloza, CEO of Corporate Excellence –
the organisation, is essential. If commitment does
Centre for Reputation Leadership, believes that
not lead to specific behaviours, it is of little use
this is a very important observation, because the key
and value. Adjustment of these two factors may be
to building reputation is the identity: reputation is
extraordinarily beneficial for the organisation and
built from within, starting with the employees, and
may be achieved by analysing and trying to bridge
is achieved through coherence of identity, values,
possible gaps.
brand, communication and corporate reputation as
a result of this effort.
Designing a clear and elaborate roadmap
Van Riel points out in his text that there are three In order to achieve this result, it is extremely
identity types in an organisation: important to design a roadmap. The roadmap is
also helpful for improving efficiency by choosing
1. Desired identity: a search for the direction. the right focus that can have an impact on
2. Projected identity: derived from business results and anticipating the obstacles that
communication. the company may face, thus making it easier to
3. Perceived identity: evaluated by the employees. overcome them.
The first objective and the first stage is to align First, certain techniques should be used for alignment,
these three identities and to make sure that the including the following two main work directions:
employees take part in the initial vision, share the
mission, establish mutually beneficial relations and 1. Negotiation: asking (holding consultations via
thus achieve alignment with other stakeholders internal presentations and negotiations) and
Figure 2: Techniques for creating alignment
Negotiation Confrontation
Consultations Replication
• Presentations and negotiations with unions • Exposure inevitable internal messages
• Presentations and discussions with the • Use of external corporate announcements to
committee (s) of company persuade domestic public
• Assignment of trainers to key management targets
set role behavior
Consensus Power game
• Briefings • New organizational structures and decision-
• Management meetings making processes
• Improvisations • Appointment of new directors in key roles
• Training in internal training programs
• New rules for evaluation
Source: Cees BM Van Riel, The Aligment factor, 2012.
Books 2The Alignment Figure 3: Drivers of strategic alignment Reputation as a cross-cutting function
Factor: How to Link
Up All Stakeholders behavior Abril believes that Van Riel’s book shows that
in Order to Achieve reputation management may be successful only
Business Excellence if it is understood as a cross-cutting function in
Information
organisations, where internal alignment is followed
by external alignment and linked to communication
Strategically
Motivation aligned behavior management. This is because by managing the causes
and policies, one can influence the consequences
and perceptions.
Training
That’s why the worst enemy of reputation
Source. Van Riel, Cees (2012): The Aligment factor
management is the inclination of every department
to pursue its own interests, to fight with other
departments and drive the organisation in opposite
reconciling (holding meetings for informing and directions – a tendency characteristic of many
choosing the direction). companies and institutions that have a strong
divisional component. According to Van Riel’s
2. Confrontation: replicating (internal and model, the reputation function should have a
external messages) and power game (decision- long-term vision in order to anticipate risks and
making, new appointments, reviews and training opportunities, but at the same time avoid turning
programmes). into a kind of “Matrix”, alienated from the reality of
its stakeholders, their true problems and needs.
Therefore, it is essential to hold consultations first,
then to inform involved actors, then to motivate,
empower, and finally, achieve the results, follow up “Reputation management
and compare them to the objective. may be successful only if
The next stage consists of paying due attention to it is understood as a cross-
communication, trying to provide answers to the cutting function, where
following questions:
internal-external alignment
1. Who is the source of initiative and leader of the as well as the alignment
process.
2. What strategy means for every actor. of communication and
3. What is the key audience. management are key”
4. How consistent are the messages.
5. What abilities should be developed. The role of the CCO (Chief Communications
6. Who should avoid being silent and made to Officer) should be characterised by an integrated
speak up. vision, combining centripetal and centrifugal forces,
as well as uniting all departments (Marketing, HR,
The final stage consists of analysing and securing Technology, Operations, with a special emphasis,
support of different stakeholders by creating and as suggested by Van Riel, on Finance). This is key
building on relations based on mutual and shared for effective management of intangible assets and
benefit, where everybody wins and, where possible, company success.
achieves the benefits they expected. In other words,
it means integrating collective ambitions under the This success no longer depends solely on the capacity
umbrella of a common goal. to compete on the market or create best products.
Instead, an important factor now is establishment
Developing a good balanced scorecard with internal of rational links and strong emotional connections
and external KPIs (Key Performance Indicators) with the society in general and stakeholders in
that allows one to extrapolate results into the future particular who become increasingly savvy about
depending on the changes of each attribute is also analysis and evaluation of behaviours and actions
extremely important. Van Riel’s research shows that of companies.
those companies that introduce a 20% increase of
bonus or variable remuneration of their managers However, in order to build a good reputation (which
for successful alignment, achieve better strategy ultimately protects and grows value, increases
alignment with the stakeholders. capital, draws clients and talent, helps to obtain
Books 3The Alignment licenses, shields in the times of crisis and ensures context, trust is a weapon in a competition for a
Factor: How to Link sustained and sustainable growth), it is necessary to scarce good: reputation as a key value, as the most
Up All Stakeholders observe the following three prerequisites: important competitive advantage that is impossible
in Order to Achieve
Business Excellence to imitate.
1. Have a clear idea of one’s mission and vision,
one’s goals and how they can be achieved. The key here is to ensure that the universe of
2. Have a clear idea of one’s values, the form and stakeholders, starting with internal stakeholders,
the style of doing things. is aligned with the corporate strategy and shares
3. Have a clear idea of action principles, the limitations the goals, hopes and success of the company. In
and the red lines that cannot be crossed. order to demonstrate this, the book presents some
good practices successfully applied by Spanish and
international companies. The result is predictable:
Conclusion: we are competing
greater alignment leads to greater satisfaction and
for reputation; in order to connection, and eventually brings about better
win one has to align business results.
The Alignment Factor (“Alinear para ganar”) has
a highly practical focus for all those organisations
that have to face profound transformations due
to the processes caused by what we call the new
“reputation economy”. In this new cycle the key
is not only what one does, but also what others
think and how they evaluate these actions. In this
Books 4Leading by
reputation
©2012 Corporate Excellence – Centre for Reputation Leadership
Business foundation created by large companies to professionalize the management of intangible assets and contribute to the development
of strong brands, with good reputation and able to compete in the global market. Its mission is to be the driver which leads and consolidates
the professional management of reputation as a strategic resource that guides and creates value for companies throughout the world.
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