n

40 t
.
publlc - - and management educ
• \•
l! ' L
atlon
1~ 7
onl y pla ce whe re exte mal relation
r~1
[3
s are con side red . Nor sho uld the
í '.'t dep artm ent try to lnsu late ope pub lic affairs
¡( rat:lng man age men t from ext ema
1,¡!; tha t ope rati ng man age men t can l con cem a so
devote full atte ntio n to its nor
mal fun ctio ns.
l~i·
Managers at all levels nee d to
recognlze the pub llc pol lcy
'/ jobs and dev elop tbe sldl ls and
knowledge to perf orm this role
dim ens ion of the ir

l 1·.' effectivel~. ·

t,.. Thi s casebook is wri tten wit h

objective of help ing stud ents see
a specific man age rlal orie ntat lon
1~
1,
f;
l•-
and the nee d to formulate stra
in tbe fl.eld are wri tten wit b an
the impacta of pub lic issues
tegies wit h resp ect to thes e issu
exte mal focus on maj or soc ial
, wit h the
on man age men t
es. Som e boo ks
FOUNDATIONS
i~ wit h very littl e suggestion tbat tren ds and issu es,
.
1

f
!
to do anything. 12 The external
salce, and there is littl e atte mpt
a stud ent wou ld actu ally use any
env lron men t is stud ied mo re or
to dea l wit h the imp lica tlon s
of the mat eria l
less for its own
OF PUBLIC
of soc ial trend.s
and issu es for man age men t pra
in som e contexts, a casebook is
betw een a disc ussi on of pub lic
ctic e. Alt hou gh this exte rna l
mor e actl on- orle nted and mu st
issu es and actu al strategy.
focus is valu able
pro vid e a link
ISSUES MANAGEMENT
The cue s in this boo k pre sen t
a var lety of pub lic issu es that
speclfic corporations. The se issu hav e affected
es nee d to be disc uss ed so stud
the env iron men tal tren ds and ents und erst and
forces tha t bro ugh t thes e issu
age nda and mad e the m the sub es to the pub lic
ject of coll ecti ve action. But stud
to focu s on wha t a pro per cor ents also nee d
por ate actl on wou ld hav e bee
view poi nt. Sin ce the con cep t n from a strategic
of pub lic pol icy is a new fou nda
in pro vid ing a link bet wee n bus tion for tbe field
ines s and soc iety , it follows that
man age men t pro vid es a con cep pub lic issu es Ma ny cor por atio ns hav e dev
tua l fram ewo rk wit hin whi ch to elo ped or ar& dev elop ing an inte
form ulat ion wit h respect to tho disc uss strategy man agi ng pub lic issu es imp orta mal exp erti se in
se pub lic issu es tha t hav e the nt to the m. Tbl s expertiae is gen
the cor por atio n. pot enti al to affect to as pub lfc issu es man age men erally referred
exp ects to man age pub lic issu t. The term does- not mea n tha t the compaDY
e wit h reg ard to soclety u
me an is tha t the com pan y ma
nases ita resp ons e to a puballcwho le; wha t lt does
lssu e in the same
way it man age s oth er asp ects
of the bw ine ss.
Thi s exp erti se hel ps the com
~\9JA~o\ ~ coo rdin ates the com pan y's resp
tha t bro ade r env iron men tal con
pan y man age ita way thro ugh
ons e to pub lic tssqes, and in
cem s tba t give rlse to pub lic pol
pub lic lssues,
som a cue s, sees
inc orp ora ted into the stra teg lcy lssu es ue
the var lou s fun ctio nal are as ic pla n of the bus ines s. Tbl s exp
in add ress ing pub llc lssu es and erti se also aui sts
nal ize an awa ren ess of the pub atte mpt s to inte r·
lic pol icy dim ens lon thro ugh
man age men t. The latt er task out all leve ls of
exp erie nce s for man age men tinv olv es, amo ng oth ar thin gs, pro vid ins leam inS
on the lm.portance and pot enti
pol icy can hav e on the cor por al impact pub llc
atlo n.
The stru ctu ral cha nge s rela .
tad to this dev elop men t of pub
age men t inc lud e a cha nge in lic issu es man -
the pub lic rela tion s fun ctio n
pub lic affa irs dep artm ent in som or the growth of a
e cor por atio ns. In IIOIDB cases.
rela tion s has bee n cha nge d to the title of pub lic
pub lic affairs: in oth er ca,e a,
now con side red to be a sub dlv pub llc rela tion s is
isio n of pub lic affa ln: and in
11SN Lee E.
Pn1toD, •Book Rm pan ies, pub llc affairs and pub
lic rela tlon s are separata dep artm
still oth er com ·
ifomia Manapmant .lllwww, 25,ew: TRChin¡ Matariab ID BIUinea and Soclety," CaJ. pan ies hav e also esta blis hed ents . Some com•
s (Spr ma 1883), pp. 158--173. com mu nity or urban afla1n dep
artm ents .

41
 r
~=•
a bnlalians d public 1auee rranaoement
"
. (•
43
thrust 0
companiea hava handled thia changa differantly, but the major
developme nta is a changa in the way business relates to the
~ - Tbe old emphuis on publlc relations, which tmplled relations wtth
presa md wu UIUally a one-way communic atlon from business to the
public, is aimply not enough to deal with the new demanda on business. Relatad
to thla change in public relations or public affairs la the growth of Wuhíngto n
offlcea, both in numbera of people employed and in the influenca theae officea
now wiald in the total corporate structure. The Wuhingto n office is the "eyes
eara, and mouth" of the corporatio n in the nation's capital. Its prlmary functio~
hu changed &om a concem with winnlng govemmen t contracta to a concem
with legialative and regulatory matters that can affect busineaa. Ita rol81 bave
become intelligenc e gathering and wue tracking to gather lnformation about
public iuues that are at various stages of developme nt and interpret these l.ssues
to manageme nL In thia seme, tha Wuhingto n offl.ce acts u sort of an lnter-
mediary between the federal governman t and corporate headquarte rs. Its Job Is
alao, of coune, to ualat in other aspects of lasues management, partlcularly in
the developme nt of strategies to maks the company's posltion known to the
proper people in the federal govemmen L
Thue changas imply that public lssues are belng taksn much more se-
rioualy than wu evldent in the old public relations functlon. lnvolved In this
ltructural changa is a real concem for doing one's homework on public l.ssues
so the orpnizatio n can participate effectively in the formulatio n of public
policy.
Public policiea can cost substantial amounts of money, wipe out product
Une, ovemight becauae of aafety and health problmns, and involve the cor-
poratlon in lengthy litigation. Thus the corporatlo n'a response to public pollcy
ahould not be a aeat-of-the-panta or knee-jerk reaction, but rather a well-thought-
out and developed atrategy bued on reaearch and analysis. Such a respo1118
1a much more likely to work in the company'• best interest, u well u in the
intereab of aoclety u a whole.
The term or concept of publlc ls111es management hu developed to refer
to an organized efiort on the jíart of a corporation ~respond effectlvely to
luun of public concern. Public iuues m•nagement a procesa by which a
ítrategy is develo ad for the ration's involveme nt in the publlc U
· roces• o a a ecific lasue. e concept UDp es t corporation s taks
a respomibW ty to become vo ved with publlc iuues and develop polldes
on theae iasues in a manner comparabl e to the way pollcy Is developed for
traditiona l busineas concerm. Among other things, public iuues DU1J188ement
ia an iDteJHgan ce-ptherln g efiort with respect to publlc ialUes of concern to
the company.
Many elementa in public ialUea numagement are not necessarily new in
themNlves. For example, ublic affain which la an euentlal com nen o
blic iuu• manyeme nt... en a fun on in most córporations for many
p u . ~ , , ___ corporatlo m, particularl y the 1argest. have had Wuhingto n offices
four,dati0nl gl publiC-- ,nanagemer,t
°""',lflonl ol pul,lc ..... ,,,.,..,,.,,,. ,
lssuea manageme nt is a program wbich a complDY uaes to tncreU8 ita
k:nowledge of the public policy process and enbanC8 the sopbistica tion
and the efiectivenesa of ds lñvolveme nt in that procesa.
From The Fundamental• of Juu• ~
(WuhlqtOD, DC: Publlc /Jfa1n Cc,uDdl,
111711), p. 1.
¡;,~ü'"
lssues manageme nt is the process by wbich the corporatio n can identify
th... ..,,.......w
and _... ...... !hal ...y¡;¡¡e,,;,r
Tbe Issues can then be uaigned prloritiu for appro-
pñate-ccirporate response.
Fram Richard A. Anmtron& "TheCoucePl md Pndlce ol 1111181 Menapmaut 1n tbe unltad
Stat•," ,peach dellvced to the Natlonal ConftlltlaD. PabUc llaladoDI Ímtituta ol Amtralla,
Syclney, Au,tralia. JuJy 17, 111111,
for the past decade. What makes publlc i.ssues mmageme nt new, accordinB to
Richard A.. Armstrons, president of the Publlc Affalra Council, is the following:
.~:
What is new-is a new corporate attitude, or "mindset'' which guidas the
Issuas Management program.
Wbat is new-is the extent of the corporate commitme nt in time and
people to external islUes and public affalrs.
Wbat is new-is the concept that tha externa! relationa of a company Is
not a function to be delegated to 11, 1taff of apeclallsts and then quietly
forgotten.
Wbat is new-ls the awareneu of the need to expand the time frame in
the corporation 's early warning mechanlsrn Most companies today try to
look ahead at least three yeara.
Wbat Is new-is more capable and aophlaticated research personneL A
bost of new tttles have appeared on the IC8D8: Director, Public Affairs
Research and Planning; Public Affaln Reseuch Analyst; Policy Analyst;
Director, Public Policy Pl•nnoJng; Govemment Research Coordinato r, and
maoymore.
What l1 new-is tha broadened arena for ection. Corporate eflorta today
cannot aimply be focuaed oo tbe leglalatlve piOCeU, rather they muat try
to :reach the public and thoae intmelt groupa mentlcmed earlier.
 A:uldltlonl ot public laues nwiage,nent
41 lculdationa ol p&b8c _.,.. rnm,ager,,n
lmportanc:e ol Publc - - Managemn
npa,tance o/Plmlc: ...... ...,__,
NUMBEROF
CffOON RESPONOeNTS PERCENT
"In large part. the outcome of these iuues determines the company•, futu.re
~ 10 23.8%
lrr1)0l1n operating environmenL"
Y.-¡"'1>o,tant
Scmewhat
21 so.o
9 21.4 "They (public issues) affect the corporation's publlc image, and, ulti-
lrr1)0l1n
Natw,,y~ 2
mately, the bottom llne of the company."
4.8
Nat lmportanc at ..
Tctal -º
42 ~ "Ows is a bigh-visibility company s1rongly affected by public pollcy i.s-
sues. Tbe stakes are getting bigher wbile the room to maneuver 18 getting
San:e:Aoga,eA.ElucHiali. "Ecb:alianF«Publc ..... Man-
llgM!n" l(ay~lran•&JNayoCTapf'ladlCb ... ·f>ublc smaller."
Allaits RMlw, 3 (111112). p. 88.
"In the short-term, issues management has a significant bottom-llne lm-
pact. In the long-ron, the continuad profitabWty and operabWty of the
corporatlon depends on the public environment."
Finally. not only new but so refreshing-business has decided to tab the
offense rather than simply defending itself. (Academics would call this
"Many public issues can have direct Impacta on the companY, its em-
being pro-active rather than reactive.) When a company can actually get
ployees, and its stockholders, and these iuue, mu,t be di,c::iwed."
involved in the policy-making procesa before the issues have become
polltically polarized, it can sometimes defuse them, or at least mfnfmfu,
thefr fmpact l "Corporate success and survival depend increasingly on semitivity to
changes in the environment in which the company doea business."

The importance of publlc fssues management to corporatlons is shown in
Table 3.1, whJch reporta the resulta of a survey of top practltioners in the field.
The data •how thet 73.8 percent of the respondents believe publlc issues man-
agement la either vmy fmportant or extremely important in their organization.
The reasons for the lmportance they attach to publlc issues management is
perhaps even more revealing (see box). Some business leaders and academics
believe that the very survival of business and the business system is at stab
and that business must develop better and more constructiva responsea to
publlc iasues than it has in the pastor be faced with a further loss of credibility.
In a world of uncertaintiea. whera changa Is the one thing we can count
on, businesaes need the ability to anticípate and adapt succeasfully to
chanp in both matters of publlc policy and their own market pursufts.
Through a better understanding of public-pollcy genesia and development,
organizations should be able to forsee public-pollcy changes and be re-
'Rldmd A. Anutnmg. "11te Ccmcept and Pnct1ce of 1a1H11 Man■pmimt ID th■ Unltad
State■ , • ,peech pnNDtad to th■ Natkma1 Couvmtion. Publlé Ral~ Imtltut■ ol Am-
tralfa, Sydnay, Amtrall■• JuJ:, 17, 1981.
"It (publlc issues management) allows u, to deal with problems befare
they become crises and permits u, to spot opportunlties."
''Publlc lssues have a profound lmpact on the manner In wbich a cor-
poration conducts its business. Effective anticipation and reapon.se will
determine the ultimate structure of our economic system and the role of
the corporatlon."
"As our former cha1nnan said, the auccesa or failme of American bualneas
is more and more determinad by govemmental policy and actiona."
''Management's view determines the lmportam:e. In one san.se. of a func-
tloJ:!. to the corporatlon, and such lmportance 18 relativa to other manage-
ment concems."
Source: RDPM ,._ Buchbolz. "Bducatlaa ror PubUc 1aae1 '-'■JMIIIMD'· x., 1m1pta &om
a Survey lli Top Pnctiti--.• Pu~ Alfaln .Rfff■w, 3 (llllZJ, pp. 88--4111.
·,
t
...
1abla U
bn:laaona ot ~ - - ~
'"1:iortant ~ ot a Public ,_,.. ManllQemenl Systen,
•.¡g
T
·;,

47
_d___ ~ '"'
~~ ~ ~
ferk fuhio u to lsaues
PUFPo.se survey. Rather than havin g to respo nd in knee- nt syste m provi des the ca-
mana geme
already well formulated, a publi c 1ssues
RANKSCORE s and devel op respo nses more Ukely to·be consf steut
pabil ity to antld pate issue
Allowsc..,_
Pllbl ~ ar va. ·react1on to· with the comp any's and sodet y's best fnterests.
1.9
Allows ~ to Nlect ..... lhal
wllt- .11eg ,....lm pact onlh e . .. 2.5
C0rJlOlllbt
PUBUC ISSUES MANAGEIIENT
lnaerta IWllvanta""- into lhe ltrategic SYSTEM
~Pl oce 2.7
G1YN lha C0n1)a ny lhe ablity 1o act In ut task invol ves respo nding to
MewlltilOC iety 3.6 The publi c polic y dime nsion of the mana gerne
fuhio n. An efiect ive rupo nse to publi c iuue s
Pr0lecll lhe Cl9dlblllty d buaines, In lhe publi c issue s in a systematlc
a serles of stages or steps that.
publlc rnncs 4.3 on the part of a corpo rate execu tive involves
Pluvides ~ b- leadershlp roles mana gmne nt tyStem. Exhibit 3.1 show s
4.8 tabn together, constltute a public issues geme nt system.
the vario w stages of a typic al publl c issue s mana
; Keyfnsigtqfram ■ Sw-..yot
~~ ~ Buchhalz. "EducaltanForPublc: ..... ~
op · · - . Pllbllc M'úa lleMew. 3 (111112). p. 70.
ldenlfflcallon
s and lssues that are likely
The first stage is one of identifying those trend
chan ge-th at is the by con- invol ves scann fng the euvir oume ut
•pona fve to them. Such an appro ach enabl es to be of intere st to the corporatlon. Thts task
to affect the corpo ration
ted with mfofr nal disru ptton. z s and issues that are ll1cely
cept, chan ge-to be accom moda to discover devel oping trend
issue s must then be cou-
s and
through the publl c polic y process. These trend
rpora te plann iug opme nts. Event ually forecasts must
The mode m front ien of ·profe ssion al mana geme nt-co tinua lly moni tored or tracked for new davel
the next l9V91'lll yaars. From
h chang a is 0CCUrriDg most proba ble coun e over
and externaI affairs-are those areas in whicmost speculaUon occurs and be devel oped to predi ct their
be made to identi fy those issue s of
rapfd ly, wher e the least fs b
- own , wher e the this informatlou, an initial screelling can term and Jong-term
leade rshtp are great- ratlon becaw e of their short-
where the oppo rtunf ties for imag tnativ e execu tlve , and large busin ess
greatest intere st to the corpo
fy lssues that will affect the
eat. . . . The manner in whic h organ izatlo ns of aU types impacta. The purpo se of this stage is to identi
erciaJ and social comp lexity cycle u posalb le.
CO?poratfons in partic ular, respo nd to comm corpo ratlon as early in their llfe
macy BJld their aurvi val.'
is fundamental to their instit ution al Iegftl
Enlud onolt npad .
publi c relatl ons and impa ct on the corpo ration
According to Davi d L. Shan b, direc tor of corpo rate Once issue s have been identlfied, their potentlal
mana geme nt of publi c issue s has n for this evaluation is to set
adver tiaing at Rexnord Corp oratlo n, prope r must be evalu ated more thoro ughly . The reaso
tfc. Publi c issue s mana geme nt l corpo ration canno t respo nd
many benefits, both prote ctive and oppo rtunis some prlorl ties for corporate responses. The typica
t issue s that will have the greatest impa ct on t proba bly does not hava the reaou rcea- nor
(lJ allow s mana geme nt to selec to every publi c issue of inter est-i ament or effort.
lnste ad of "reac tlon to" issues; (3} can it respo nd to every issue with the sama
level of involv
the corpo ratfo n; -C2J allow s "man agem ent of' ing ss; (4} gf ves the comp any poten tlal fmpac t of the issue on the
inserts relev ant issuu into the strate gic plann proce oppo rtunf tles for leade rshtp
Priorltles must be set according to the
of occum mce, the corpo ratlon 's abllity to
(5} provi des corporation, the issue 's proba billty
the abilfty to act in tune with socie ty; publi c mind . 4 Table of this stage Is a llst of lsaues
roles: and (6) J)l'Otects the credi billty of busin ess in the respo nd, and other relev ant factors. The outcome
gave to these purpo ses in a recen t with priori ties attached.
·
3.2 show s the ranlcing that top pract ftion ers

J1anapuwit Joumal, Summer 21177 (New

PubUc-PoUcy Chanp ,,"
2GraJaam T. T. Molitor, "How to Amfcl pataYadc:
S.AM. Ad111111c:ed
Soclety for Adnn c. ol Mauqm,1111t, 1
~-....,,.,. of bighest prior-
The next stage involves basic analysis l'8S8UCh on issues publl c issue s
dMá m ol Amerlc:u Mmq emm J\aoclaUoa, 1977), p.
5.
of a publl c affair l staff devot ed to
. Socla J l1ncemlnty," BuaútuHoriZQm, lty. For this task, invol veme nt
,._E Post. '"The C.U-. .ofMa ua,lql lllder
by the Fm1ud1Non far~ Schaol ol B1WDNI research is impo rtanL Involveme nt of function,al areu --wc h u manufmtming
AIIIIUt 11177, pp.11 -SZ. Q,JIYIUbt • 11177, . or perso nnel when the issue is mi-
11 IDdJua Unmn tty. Repr{Dt.cf by pmnl alan.
any', &mtonments
wheo enviromnental issues an concemed be at thia stqe,
, - ~ B1owu , TJiú BuaJn n, a/ Iuua: Copin , wlth the Comp
nority hirin t-is also crucia l. Outsi de sourc es can also used
fHw.Yoib 'l1le Coulanace Board, 111711}, p. 7%.
----... 41
baldatiana d P1.1b11c lseues ll'llnlgement
ExhlblU.1
Publlc:i..M&nagernemSyatem
.L ~ Pub1c r.u.. 111d TNndl In Pub1c Fr.pectalfonl
• ~ lhe lfflllral, ... 11 u lrwldl 111d ......
• Trackk,g nnde 111d _,.. lhat 11'9 develoai,.,
• ~ fonlcuta of nnds and - -
• ldenllfying lhoN of lnlllrNt ID the c:orp...illbi
IL ~ Their lmpect and Se111ng P!biUea
• &1111 ,.11 uf lmpect lnd probabay ol occun.101
• & ••11 uf c:orporate neoc.tea and ab1111y ID l'llpOnd
Pres-,llloo ot ..._ priorl1IN far further analyaia
111. RNean:t. 111d Analysla . There are many upects to strategy development. Issues need to be categorized
• ~ of ..... alung rellYant dlmMalona
• Enurng lhat pr1artty . . . . rlCelve llaff OuWrage
lrwoMng f«n:llunaJ.,... whera 1pprop,1ate
Ualng uUlllde 80W'CIII ot lnronnatlóñ
• De\,alup.,e11 lilld analylila ol P0llllori upllona
rJ. Slratagy Dwelop111&11
• Analysla of poeltion 1111d ltral8gy opcions
Managerneñt dec:lalun on J)ulllllon 1111d ~
lnlegratlon wlth uverall business slrategy
v. ~
• Dlaemindun of agreed-upon J)Olitlon 1111d ltral8gy
DftNip.11&11 of lacllcs 00'1liatent wfth lhe CNWal ltralegy
o.v.top¡,19111 of alllances wlth externa! urga.ilzallui ..
·l.lnkagé wlth Infernal and extemal COllillU1lcatlo networb
VL Eva1ua11an
• &a II ne.ll ol mulla by ataff
Management9YÚl8tiull
• Mudllicallon ol lrnp1ementa11un plens
• Addlllunal research
Soun:e: Adaptad from Donald J. Wai-, "Tbe 0-IÚII PoUUcal EnYirllmu8lll of Bulin-," papar
,--.el at the Canfannce CID BIWD- ud Ita C-gin1 En'l'iloJmieat, lJCLA. July 3l, U.71: TJi.
l'undamenlals o{Jaue Mana,ement, p. 2: 1111d Jan Wibon, "OwaderfaUe1 al Futuna~.• -anal
prepu11C1 lar Canf- on B ~ EnYlrmimeat and PubUc Pollcy, WuhllllfOD Ulllvmwity Center far
tbe Study al Amatcu BIIRDNI, July 1-13, lll79.
particularly consulting organizations, academia, or research centers such u the
American Enterprise i:n.tttute for Public Policy Research or the Center for the
Study of American Business.
At this stage, the corporation must do its homeworlc and perform quality
research on public issues comparable to the Jdnd of effort devoted to techno-
in
logical iuues research and development Iaboratories. The development of
a good priorities Jist fs essential, since a corporation cannot do a thorough job
of research and analysis on every public issue that is identified. Issues must
be categorized by the cunent stage of their life cycle. This analysis is useful
in deciding what to do about an issue, because the intent of this stage is not
only to analyze the potential fmpact an issue can malee on a corporation more
thoroughJy, but abo to analyze the different positions and strategies that can
be tabn on the issue. The result is an analysi, of the varlous dimensions of
an issue, including the pros and cons of different positions and strategies.
f
... lutmallunl ot publlc luun rnanagement
.......,,,,...,.,_.,
From this research and analysis phue emerge the diffenmt opttom that
can be talcen on an issue, along wtth a recommended po,ition that can be
presented to management for comidmation. The recommended posttion mu.st
reflect the best thinldng of the corporation and be bued on solid .nsearch.
rather than a hastily put together reaction that will most Jibly not work in the
corporation's best .interests. Management must eventually decide to So along
with the recommendá.tion or adopt one of the other options.
The choice of an option can also be put in terma of strategy formulation.
along relevant dimensiona so the strategic lmplications will become more ap-
parent. The choice of an overall strategy that reflects the nature of the issue u
well as the objectives of the corporation needs to be made. Speclfic lmple-
mentation strategies or tactics then need to be adopted that ll'8 consistant with
the overall objectives. Because of its lmportance, this stage will be di8cussed
more thoroughly in the next section of this chapter. The notion of strategy
formulation is most useful in terma of dealing with the cases in th1s book.
~.latlowl
The choié:~ of an overall strategy must then be disseminatad to the ap-
propriate people in the company who are responsible for lmplementation. They
must develop specific tactics for changing r.orporate behavior, influenclng pub-
lic opinion, changing the thinlcing of public policy-mabn, developing a cowt
case-whatever tactics are consistent with the strategy chosen. U other parties,
such as a trade association, are involved, alUances must be bullt and action
taken. Lobbying tactics must be developed and carried out if attempts at les-
islative influence .are appropriate.
Linbges with internal and externa} communications networlcs must be
developed u needed. For example, if grassroots lobbying is called for, the
grassroots networlc must be activated. If a change in the way a company pro-
duces a product to reduce ecological damage is approprlate, th1s must be com-
municated to the plant personnel who are in a position to make the necessary
changes. Externa! communications involves lnforming the public about what
the company is doing to meet public expectations or enpglng in a debate about
the issue itself.
Enluaflon ol Strategy
Finally comes the all-important stage of evaluation. Tbe tactics that are
implemented must constantly be evaluated to ucertain whethar they are acb1evms
results. Some lcind of evaluation system must be developed to detmnlne,whetber
the public lssues management effort Is a success. Thls ,valuation is extremely
difficult. How much credlt, for example, can any single corporate effort be
given for the defeat of a blli in Congress7 Or lf the bill pused when the objective
was to defeat it, was this the fault of a single corporate lobbyin¡ effórt? How
 ·-··- _·:•--·-=- = = ~- ~ -- -
11 (ounda1lonl of publk:-- n,anage,ne,1
bxldallona ot publlc - - manaaerrwnt 51

can changea in public opinion be meuured and attributed to a speclftc advocacy ldentlfylng Public 1 - and
advmtiaing program? What is the impact of a corporate economic education Tqndllnl'ublkE xpemtionl
program?
These are very complex queations, and yet without soma kind of evalu-
ation by both the staff involved in public issuea management and management Llst of • - of lnterflt
ltself, the company is operating in the dark. so to speak. The process of eval- to thl c«poradon
uation is important because the implementat ion tactics may have to be modified
in light of the evaluation or additional research performed to develop different
positions. Ev1hming Thelr lmpact
1nd Settlna Priorltiel
Ali through this public issues managemen t proceas, a number of key
decisiom have to be made. Figure 3.1 shows theae decisions in the form of a
flowchart. The actual decisions and outputs of each stage are shown in the Priorhv Llst of lss-
boxes. This exhibit shows the "flow" of an issue through the public issues 1. - -
2._ .....-
_-_- _-_
rnauagernent system. 3.
According to a survey of public issues management practitioners com-
pletad in 1981, there have been significant improvem.ents at almost every stage
of this publlc issues management procesa ovar the last three years. Table 3.3 R_.rch and Analysls

shows that between 50 to 70 percent of the respondents believe there have been 1
Position l)evelopment

~-
Table &3 Signlllcanl lmpltJYemenls in Capabillty
,______
Position Options

NEA OF IMPROVEMENT
NUMBEROF
RESPONOENTS PERCENT
2.----
3.
Recommendod Position
Evalualng the ln1)8Ct ot 29 69.0'l' endChoia
public.__an lhe
corpc.allon and aelting
priartllN Strategy Oevelopment
0..•lopnwtt al a sntegy 27 64.3
IO ,-parid to public
. . . . al concem to the Choica of Strategin
~
R1111rctVlda ,al)'llsof 25 59.5
public . . . . ldenllfled u lmplementation
bling ~ l t to the
COlpollalfon
ldlnllylng publlc: laues 23 54.8 Tactics
.., lrands In public Anlancn
...,.11111o. 21 so.o
eommunlcatlon
~ltalfon of llrategy

.....
wlll re■pec:l to publlc

EWU110nolltMr1e■po1• 14 33,3
Evaluatlon

toapublcluu e ,,....a.1 flcM-(:haltol f'Ut¡lc--MlrlfOIIIIIIIC- ~ Aogl!WA. ~

10 23.8 halZ.,_. ..~-Pub llcPolk: t:~f0r~~
OdlS-
~ofRnulU gllwood CIIII. N.J.: P N I ~ 111112), p. 472.
Scuce;RogafWA . 8ucflholZ. "EclucalionlorPublc l a u a ~ t<eylnllgtúlromlSu!WYol
Tap P,..::llllal..,._ • P,,bk; ..,,_,. ,..,,._, 3 (1882), p. 88•.
·- ,. ~

a "
~ e l ~ . . . . ffllnaQemenl lculdationl el public 11111N rnanagemn
13

aignlficant lmprovements in capabllity in the first five components. The rela- Exhlbll3.2
tively low percentage on the evaluation component la undoubtedly due to the TineTypeealEITllll'gklg .....
difficulty of evaluating the resulta of the pubUc issuea management effort.
l. Operdonll
• . Hazardoul ..... cllpolll
PUBUC ISSUES ANO ST'RATEGY • Add rain
• w. . lhortagll
FORMULATION • Tralllt. cu¡gNtlan In a plan( 81N
n. ·Corponlla
• Federal char1arlng
Since thia book is written with a managerial orientation, the cases it contains

--
• Corpcnta ~ I C I
must be looked at from the perspectiva of strategy formulation. The cases are • Corpcnta pmllccllclalln
not meant solely to lllustrate the development of a public lssue and to show • Legal end at1lcal bllavlar
how the laaue affects corporate managemenl The cases alao provide an op- 111. Soclelal
portunity for atudents to develop atrategies with respect to thoae isauea. The . ~rlllorm
Co,¡g¡eakllial
strategic responses that management made in the cases can be criticlzed, and Na11ona1 econcmc p11nn1ng
students can develop alternative atrategies they believe would have been more
approprlate.
~ . ,.,.,........
EJedlan ~ lnlndng rlllorm
1W:Jrmof1twkllllallYlpn10118
In developing atrategy with respect to a public issue, it is useful at the Aag!JlalllrYrafolm
• Penonal rti,111 and •••--11amm■
•ra•
outaet to analyze the laaue along certain dimenslons that are of importance to f'..onalprlvaty
the corporation. Public lssues can be categorlzed according to type-for ex- Sexual pnfanllCI
ample, by the extent and manner in which the business la affected (Exhibit Rlght to • Job
Comperable wor1h
3.2). An operationaI issue may affect one or more, but not ali, operating units HNllh cara
of the corporation. The lssue may affect only manufacturlng or marketing, or FINdam flom rllk
RallUllon for l0INS
may affect only certaln geographic regions. Many environmental iasues are of
this natura, affecti.ng only certaln planta that are not in compliance with en-
vironmental standards or that manufacture products subject to an emerging lll Iba Publlc Allaln CauDdl Waobl,op. Wul,lnallm.DC....,
AdaptadframF. W.$1acbD-. •s-D111nftkmamdEmapi.ol1'11111k:l'lllk7......_.papor,_.....
l._17, 117L.,..... wtda ,-rl-tan

public concern. Strategies for these lasues need not affect the entire corporation
or involve people from ali corporate operations.
A corporate issue affects the corporation as a whole and can affect the
way in which the entire entity functions. Issues such u corporate govemance
or public discloaura of lnformation are of thls natura. Jl the Securltiea and
Excbang11 Commission, for example, were to require the disclosure of social
lnformation, this would affect ali unlts of the corporation. Likewise, the in-
volvement of employees in running the company, whether at the board level
or on the shop fl.oor, could affect all aspects of corporate structure and operatlon.
Finally, a societal issue affects the environment in which business func-
tions. Such lssues as national economic planning and regulatory refonn fall in
this category. So does the govemment's macroeconomic pollcies. Wbat the
govemment does to combat unemployment and inflation affects capital marbts,
stock prices, and the entire economic environmenl Issues that relate to trade
can affect the entlre international environmenL The isaues in thla category are
in many ways more complex and involve more interests than those in the other
categoriu, making atrategy development all the more difficult. 1
1 Fnn Staclcm.t, •Soma Ddnltiom ami Exampla af Puhllc PollÍ:y luues, • paper pn-
Nntad at tb8 Publlc Affalra Coundl Warbbop, Wllhlqton DC: Publlc Affml Coundl,
11178), p. 3.
Another way to categorlze public issues ls accordlng to timing. Issuea go
through various stages, and it is of great intersl to a corporate manager to have
an idea of where an issue is with respect to ita life cycle. Tbe stagea used to
describe the llfe cycle in Chapter 1 are more ar 1- from aociety's polnt of
view. A more useful categorization for the a,rporatlon ls to think of l.auea u
latent, emerging, current, or instltutionalized.
A Jatent issue is one that la still not widely dlsculSed in the media or by
public interest groupa or other atabholders. But one might detecl that pnaures
are building with respect to the issue or that tnmds are dsveloplng In aociety
that may maka the tasue bnportant in the near futun. At th1a atase, corporations
have a grea.t deal of discretlon In reprd to their response, so tt u to thetr
advantage to anticipate issul!II and catch them in the latant stap lf at all poasible.
Perhaps some adjustmenl in corporal• bebavtor at tbla point will defuse the
lssue and keep lt from golng on to other stages.
An emerging issue 11 a publlc policy question with thne eaaential cbar-
acteristics: (1) Ita definition and contendiDB positiom are still evolvfn&; {2) lt
is lilc.ely to be the subject of govermnent action in the next thne to lve yaan;
,-
,J:
14 ¡t:tf
lluldallone of public - - manager,w,c 11 fou1dallons of public - - rnanagament
ration a. • The iasue ia not fully Exhlb lt3.3
IDd (3) it CID be •cted on by affec ted corpo group s and affected partie s. CorporaM Respol . . to Publc . . . .
of discu uion by many
poUtized, but lt is the subje ct
and the outli nes of publi c polic y lntentctive
PubU c opfn lon is being form ed on the iaaue, ssfon RHCtive Accommodatíve Prr»ct Ne
are begin nlng to tab shaptee.and At this stsge, businesa can engage in the dJscu AdjJdng
and help shap e the deba fts outco me. Adaptwlg lnbnc á1g
Fighling c:hlnge lo~
other wtae acted on in local, to changa
A CWTent iuue t. one that ia being deba ted or changa
instit ution s. The iasue ia fully politf zed at thia ■JMf .nf l'ublr; l"o/lcy. j¡,p/bll lolla l a
r ~ (En-
ltate , or federal_gove rnme nt Soc.,w ; R0glll l A, Buc:Moll, 8uli'. a E/lwD
the issue are being form ulate d
Polnt. and specUlc publ ic policfes to addre ssare limit ad to some form of par-
glNgo d CIiia. NJ: ~ 11182), p. -464.

and deba ted. Bust neu activ ities at this stage

shap e to the polic y or polic ies that
ticipa tfon in the legia lative proc eu to give d to these .iuues, certa in
fic bill can be defea ted or perha ps busfnesá With respect to strategy form ulatlo n in regar
even tualy resul L Perh aps a speci gies can be chos en can
its imple ment ation . overa ll respo nse patte rm withi n whic h speci Jlc strate
can have 10me fnflu ence on the conte nt of the bWforand h publi c polic y has nse patte rns to publ ic Js,ue s
The institutionalized stsge refen to i11Ues
whic be descr ibed. Ther e are four such majo r reapo
ved are now being 0D8 time or anoth er.
alrea dy been form ulate d and what ever pollc ies were appro (Exhibit 3.3) that corpo ratlon s have adop ted at
by a gove mme nt ess does not treat a publi c issue as
impl emen tad. Most libly , thia imple ment ation is being done In the react ive respo nse patte m, busin
ose of imple ment tng a at least as far u cban ging r.orporate beha vior
qenc y, perhaps a new one set up for the sped
fic purp withi n the doma in of its conc em,
polic y woul d malee in corpo rate
new area of publi c polic y, or an old one that has been given some addit ional is cmic emed , and oppo ses any changa publi c
are large ly limit ad to rearg uard actions
opera tions . Busi nea by and larp adop tad thia
patte m in the later 1960 • with
reapo mtbl lities . Optio ns at thia stage
court s as ugh some attem pt may be made to an-
of legia lation in the respe ct to cons umar leglslatlon. Altho
that cons ist of quest ionin g the impl emen tation does not deve lop a comt ructf ve
agenc ies iasue neweffecrules , for axam ple, or work ing with the agenc ies to devel op tidpa te publl c issue s in thia pattern, busln .eu
rules that are cost tive. posit ion, but use;· every mean s at its diaposal
to 8ght chan ge by bloc:Jdns any
a chm p in corporate behavfor. Anot her
Categ orfzin g issue , along these dime nsion s can
help in fonnu lattng strat- raolu tion of the ialue that woul d mean
As thia book is being to descr ibe thia respo nse patta m Is ltonewalling.
egy in response to those issue s thet affec t the comp any. word that bu been usad
ea limp ly adap ta to the
wrftten, a laten t iasue that is socie tal in µatur
e conc erns the right to a j1;1b, The accom moda Uve response meam that busiD
meuu re u best it can and attem pta to
whic h could resul t in IJmitations on the right
of corpo ration s to 8re peop le changes invol ved with a publi c policy eu. The comp any
notlo n of com- ble with its main line of busln
ging iasue conc ems the ¡et on u quick ily as possi
witho ut good or just cause. An emer in any and agaln need
mab a no attem pt to figbt or influence chan p
DWU Jer
Thia issue is being diacu ased, but has not u yet
parab le wort h for wom en. cbu p. 'I1le conc em• expre ssed in
n. It is anoth er socie tal iasue that not set up any rnacb anlan to antic ipate
beco me the target of formal gove mme nt actio a1r pollu tion legialation legialation md regul ation are accep ted u legitl mate, and are accor nrnodated
ugh much
woul d affect all corpo rate opera tlons . Altho aal cllan ps.
d, pollu tion ia also a curre nt i11ue becau se of the with the appro prfat e opera tiona l an:d mpnl zatlo
is alrea dy lnstit ution alize air Jdnd of Dt-«:banfam to
that woul d impo se new atand ards In the proac tive response, businea develops 10m9
need to deal with the acid rain probl em. Bilis that will affect the corpo ntion most sigrillicantly.
the probl em have been intro duce d antic ipate tbose publi c issua
and new methods of diapoaal to mitig ate even has inter- But rathe r thm .flghti ng chang e or slmpJy accor
nrnod attna to the cbanpa a
is alrea dy polit lzed and e by chang-
into Congreas and debated. The issue l issue that affects only certa in publf c ialue rnay involve, a corporation attem pts to influe nce chang
natlo nal dime nsion a. Acid rain is an opera tfona ing the envir onme nt in whlch iuue s arise
and are discu ued. The p l of a
plant a in certa 1n regions of the coun try. Final ly, thm, are many instit ution alize d becor nin¡ necw uy, if pout ble,
has alrea dy been fonna lized and is be1ng imple - proactive stn.tegy is to preve nt cban p from ntion .
iatu a for which legis lation or at leut t,. rnJnl rnln the effecta of • partic ular publi c faue on the corpo
atage concerns the insta llatio n
mentad. One iatue that is stW being fought at thia recog
In the interactive response patte m. the corpo ntloD c expectations are
nizea the legit-
of afr bap in new cars. The IOve mme nt aganc
y responsJble for lmple ment atlon gh whic h publi
nqui rlng afr baga, and wu told in lmac y of publi c polic y u a proc ea throu
of auto ufety meu ww resci nded the Nle ty are inter-related. 1'hia reco,-
actio n and had to lmple ment the expressed and the fact that busin eu and socie
a court decla ion that lt could not tab thia yet been heard. nitio n involV81 the use of differeDt strat egi• to
adjus t to chms lns publl c ex-
rule. The lut word on thia iasue hu not u at Bosto n lhüva ntty: "Sometlmea
pectatlons. AA state d by James Post. pl'OÍe SIOr
, to change corpo rate
nce publl c oplni on; at other times
action Is tabm to influe
DC: PubUc Affain CowadJ, 11178), tha Interactiva appro ach
behavior. Tbe two pnre quisl t.s for succe ufull y
Uling
9n. Fundamentoh, o/ &su. Mano pment (WublnlPOR
p. 3.
 ,,

• b.n:tallonl. ol publlc - - 11\anagernent

·Ji '
~r,,
57 looodatlonl ot publlc-- manaoement
are ~ manqement commltment to anticipatin external chan
~ to adjust the corporation'a normal operatt!n, to m1n1-•--gthe
~
and •bewilling-
e gap tween
=~-!~•!I~::
:•:;..;. ••• ~=i,":::·.%~1.#.-J
.,""'}•,· .... ,:4•:-!"• ......•.,:
..,..uormance and AYl"lar+nti
active • ~...,...... on,.
Wh
en consistently applied over time, an inter-
pproach tenda to produce goala that the company and the publi e can
accept. " 7 .

The
-8 Hlgh
ij~Jif1;¡¡;¡J
These latter response pattema need to be further diHerentiated
tiva ~ Interactiva cmporatton attempta to develop a reuonably 8 ~
of public lssues with which 1t should be concerned, analyzes these
proa~
iaa~or
i
-5 Medlum
¡~!Ji-~!
g
impact, and developa a conatructive response. The dlfierence between these
two response pattems la that In the proactlve approach, the corporation focusea
ita initlal efforts on the external environment to by and prevent change and 1· Low
engages In lnternal changes only lf this effort falla. In the lnteractlve app~ch
the corporation atrlkea more of a balance between ita lnvolvement In the publi~ u.- Cumnt lnatfludanallnd
pollcy arena and changes In ita own operation and organlzatlon. 1s-Staga
Public issues management comes into play In chooslng an overall strategy
or response pattem be.sed on a systematlc analysis of the issues and discuasion flelflC)Me.._...
of alternatives. The analysis of lssues and the choice of an overall strategy can ~ Acaimmodatlve -
~ depicted In a matrix model (Figure 3.2) that shows the relationship of the
tim1ng of an lssue to its impact on the corporation. Whether an issue is emerging D Proac1M p:PfJtJ
~····
lntarllCllve

RNc1lve ...... u
Flgla9 Slrálglc !JI,• • • el f'ljilc

or current, and ~hether ita impact is high, low, or medium, has soma bearlng
on the choice of an overall strategy.
H an issue is latent and ita impact on the corporation is judged to be low
or high, or if an issue in emerging and ita impact is judged to be low, an
accommodative atrategy might make the best sense. The cost to the corporation
- of adapting to public expectations may be relatively lów In these cases, and
such adaption may just satisfy expectationa enough to prevent the lssue from
reaching a further stage. H, far example, buslneaa had adjusted ita retirement
policies to meet the axpectations of an aging work force a few years ago, gov-
ernm1111t legislation on thia matter might not have been necessary.
Latent issues that have a high fmpact, emerging issues that have a medium
impact, and current issuea that have a low fmpact would seem to demand a
proactive strategy. Either the impact on the corporation is high enough to justify
an expenditure of effort to try and prevent changa, or the issue is 10 far along
in ita life cycle that a proactive strategy is necessary to by and minimfze the
effect of legislation that is already being considerad. Business is thus better off
to try md in1luence the environment In which lsaues are being dlscussed or
public policy formulated rather than simply accommodating itaelf to cbanging
public expectations.
Issues that are emerging and have a high impact, current issues that have
a medium impact. and inatitutionallze d issues that have a low impact ca1l for
an interactiva strategy. The lssue will have 111ch a high impact orbe so far
along in ita life cycle that some klnd of change on the part of the corporation
"JGll8I E. Poat, "PuhUc Alfaln IDd Meuprnent Polfcy ID the 198111, • Pub.lJc Affain
Jwt,f..,., 1 (1880) p. ••
is Inevitable. But the nature of this chan.p can atill be affected by a proactive
strategy, even if the issue ls lnstitutionalized. In thia lut atap of an tuue,
corporations can still work lnteractively wlth regulatory 1geoclea to ahape the
particular regulations being wrltten and mab them more COll affect:ive.
A reactive strategy may mab the most senn, lf it la u.sed at ali, when an
issue is well along in ita life cycle and the impact oo a coq,oration la high u
far u changes In corporate operations are concemed. Public sxpectationa are
already formalized In leglslation or regulation at thia point, and • reactive
strategy is about ali business has left u an option. Thua lt may mab aenae far
business to challenge regulatiom In court. far example, to bny time or hope
for a favorable ruling that will overtum the regulation or modify it in aoma
fashlon.
The choice of •n overall atrategy la not the only strateglc decislon bualneu
has to malee with respect to a publlc lsaue. U buaineas is golng to react to
changing publlc expectatiom by aa;ommodating ltaelf to th.ue axpectatiom or
by a mixtUre of accommodation and proactive atrategiea, bu.linea has to decide
whether to lead public axpectatiom, to attempt to close the gap and meet them
but no more, or to lag bebind and allow • pp between expectatiODB and per-
formance to continua. Flgur8 3.3 showa that m•D!lpYDl'lllt bu • zone of dh·
cretion with reapect to an luue tbroughout a pd put of lts llfe cycle.
Finally, there la the matter of choosing detailed ~ - Perbapa tbeae
ere bettar callad tactie1, but the me of anothar mm 1D&J onÍy cauae confualon.
In any evmt. once buainUS hu chosen an overall atrablO md declded bow
to deal with ch•nsln1 public expectatiom. lt hu to decide on metbocls to
 -~
• bn:lallona o, Pllblc: - - ~
'l:
\·•·
~\ 11 b.rodallcxw of publc i . . . rrallQ ll!lelt
'\.

.;,·
Hlgh ·.~ ,lon, h.irins and promotion pol-
reapect to produ ct devel opmm t, capital expan
¡--Zona of Dlec .elfo n4 iciea, and othar actlvitiea. Yet it la on th1a dime
of the cuea
mion that IDOll corp omlo m
Wuatrate. But the comp u.y
l ___ 1
Publlc: have the greatest difftculty, u aome
1.e~ ac1 ÜP9Ctftlona
that ahuta down a plant In today'a world witho ut
recogn1zln9 tbat a ahutdown
ofCo,p oreta
-- begi ng for trouble. The sama can
, , ," la not a prlvate matter but a publi c one b
1
, --- ~
1
·1
, · . ,,
, ,✓
. be aaid for many other luuea that have tradit lonal ly been thoug ht to be print a.
that has publf r dlme nalom ,
Strategy muat be developed with reprd to uy luue
1 , ,
1 , ,
, ovma ll corpo nte pJ•oo ins
and that atrategy JDUJt be lntegrated into
1 ,
1 / ,,, eu and man-
J 1
1
1
:,,_ ,,,
,
/
,,
,,
,,
,

ug
Flgur eu ~ a l ~
~Sc uce :Ra batw.
Ackaman allCI ~ A. Bauwr,
~Soa .tl!N pca• ,w.., _.
Teach ing of publf c laaue s

be uaeful in atrategy formulation.

mana

The
geme

lnten
nt
qeme nt involvea devel opmm t of akllla and lprni
t of
In

thb
achoo
os
book
la
of
la
of busin
know
not
The
ledp
aimp
lnten t
ly
ls
that will
to prese at
to leam
..,.- TheAlodw,n °""'1me (Rwaon. VA: publl c luuu that are intereatfns In their own
righL
1 A111ar1 l'ublatq. 1878). p. 311. I. and more apeci flcally, about atrat-
Rep,trqcf wlh P9lmallan al . . . aomethlng abou t publfc iaauea man•pm"'U
l -- '
[ viewed from th1a penp ectiv e
egy formulation. The cuea In th1a book can be
Low
lan l'Ltllltw,g Co.•lnc.,. Prlnb-
wher e their responae can
--- --- -T im e- --- --- Hal Co., 11480 S1.w1111 ... Ad., . to 1ee how companiea mana ged a publfc ~
and
Flellon.VA22Qlo. thb pmpe ctlve In mind u they read and
be lmproved. Studenta ahould bep
analyze the cases.
engage in advoc acy advertising
accompliah thae overa ll objectives. Shou ld itmore effecttvely than in the put?
to lnflu ance publi c opinf on? Shou ld it lobby
n Committee to by to influence
Shou ld the corpo ratio n fono a Polit ical Actio ld it file a .lawa uit to try to
a repre aenta tive? Shou
an elect ion or the .vote of
t corpo rate operattona ahould be
preve nt a rule from being lmple ment ed7 Wha
g and prom otion polfd es ahould
cban pd to try and be leu pollu ting? Wha thirin
hit cbanged to by and accommoda te wom en'a concema abou t recelving leas
iona depen d on the apecffic
pay for comp arabl e work ? The anaw era to these queat
cfrcumstances sunoundlng the Ú8Ue and the resou rcea the corporatton hu
a must , of cours e, be
available. And these lmpl emen tation strategiea or tacticration hu decid ed to
the corpo
coml atent with the ovara ll atrate gic patte m
adop t
a publi c iasue, thia atrategic
Once a strate gy la deve loped with reape ct to
plana of the corpo ration in the
plan needs to be integ rated with other strate gic
re 3.4). Nothing could be more
deve lopm ent of a total corpo rate strate gy (Figu
c laaue a into a total corporate plan with
lmpo rtant than the integ ration of publi

Total
Corporal9 lrúgral lanotC orporu S1ra-
fllule U
-
&cm.gy egla&.