CALIFORNIA MANAGEMENTREVIEW
Volume XXIX,Number 1, Fall 1986
ofCalifornia
© 1986, The Regents ofthe University
Competitionand Cooperation:
New Trendsin Corporate
Public Issue Identification
and Resolution
StephenE. Littlejohn
Thefirst
ofmany
United
yearsofthisdecadesawthestrategic
repositioning
Statescorporations.
Buffeted
andaneconomic
downbyenergy
upheavals
from
external
and
turn,companiessoughtmoreprotection
forces, more
control
overtheirdestinies.
with
in
Now,
strategies place,thehopeisthat
success willbe relatedmoreto a company's
ownefforts,
rather
thanto
externaltrends.
of socialand political
issues appearsto be
Corporatemanagement
too.
There
is
more
on
focus
of
changing
issues,theachievement
priority
corporateobjectives,and concreteactionby thefirm.In short,issue
is beingharnessed
toassistdirectly
inthepursuit
ofstrategic
management
goals.
Whataretheimplications
fortheissuemanagement
Theneedto
function?
hasplaceda higher
valueonestablishing
thefinancial
andstrategic
prioritize
withcorporate
which
impactofissues.Therelationship
objectives,
usually
differ
betweenfirms,
hasledtogreater
their
issue
diversity
among
agendas.
on issueoutcomes,
are conFinally,to exertmoreinfluence
companies
ona shorter,
timeframe.
centrating
two-to-five-year
Beforethisreorientation,
hadrecognized
thatsocial
manycorporations
andpolitical
those
which
take
them
canhavea
issues,especially
bysurprise,
To reducethelikelihood
ofsurprise,
majorimpactonbusinessoperations.
elaboratescanning
Theseprograms
lookedoutsystemswereinstalled.
wardandweredesignedtoidentify
andlistemerging
issueswhich
might
affectthe firm.Hundredsof publications
were read andthousands
of
From Stephen Littlejohn,"Competitionand Cooperation: New Trends in Corporate
Public Issue Identificationand Resolution,"a chapter in Business Strategyand
Public Policy, AlfredA. Marcus, ed., to be published in 1987 by Greenwood Press,
Inc. Used by permissionofthe publisher.
109
110
STEPHENE. LITTLEJOHN
clippingsassembled.Managersbecameawareofexternalsocialandpolitical
trendsina new andmorecomprehensive
way.
lookinward
also appearstobe takinganinitial
at
Now, issue management
thefirm's
success.
competitive
corporateobjectivesforitsroleinachieving
The resultis anadditional
whichcanbe called
approachtoissuemanagement
because a company'sissue man"competitivecooperation":competitive,
willhave a materialimpacton its competitiveness,
agementperformance
ofcorporategoals;cooperative,
measuredbyachievement
becausediverse
issue agendasrequireissue-by-issue
coalition
even
building, withtraditional
adversaries.
Each elementof "competitive
the other.The
cooperation"influences
to assess theimpactofan issue
competitiveimpulsedrivesa corporation
morecarefully.
other
Thishelpsthefirm
definehowitdiffers
from
politically
firmsandinstitutions.
thisalso freesthefirm
to cooperatemore
Ironically,
withothersinconnection
withissue-specific
coalitions.
Itisnolongerlocked
intobroadideologicalpositionson issues suchas therelativerolesofthe
ofgovernment
publicandprivatesectorsortheappropriateness
regulation.
A firm,withpreciselydefinedbusiness-related
goals, possesses greater
to formcoalitions.It has givenitselfnegotiating
roomby
maneuverability
at
a
better
of
its
core
thus
the
interests,
arriving
understanding
narrowing
numberofissues on whichitfeelscompelledto standfirm.
enhancedbecausecompetition
willbe less directin
Cooperationis further
the futureas morefirmslocateandexploitshelterednichesinthemarketis notwhat
place. "It's a hugehorizon,so head-on,face-to-face
competition
it once was," a top chemicalindustry
executiveobserved.l Increasingly,
firmswillbe competingagainsttheirownperformance
goals ratherthan
directlyagainsteach other.
Finally,a competitive
approachtoissuemanagement
impliesthatitis no
sufficient
nor
even
or
longer
appropriate to prevailon allthepolitical
legal points.Instead,issue management
programsmustcharta courseof
actionthroughournation'smixedeconomywhichwillenhanceachievment
ofthefirm'sstrategicgoals.Thismayinvolveparrying
animmediate
political
issue in orderto achievemoresubstantial
long-term
gains.As a chemical
industryCEO saidofhazardouswasteclean-up,"we decideda yearago to
stop arguingand clean up the damndumps,because it was bothering
adversaries,ratherthanlegaland
people."2 Cooperationwithtraditional
battles
over
is beingadoptedby some
political
clean-upresponsibility,
companiesto deal withthisissue.
This articleillustratesthe emergenceof"competitive
cooperation"
by
two
underwent
since
1980,
examining companieswhich,
strategicrepositioning,added greaterfocuson theirissue management
programs,and
The twocompanies
adopteda cooperativeapproachtoissuemanagement.
are Gulf Oil Corporationand the MonsantoCompany.For each, the
establishmentof new strategies,the refinement
of issue management
PUBLIC ISSUE IDENTIFICATION AND RESOLUTION
111
programs,andthepursuitofcooperativeapproachestoissuemanagement,
areas, willbe discussed.
especiallyintheenvironmental
MonsantoCompany
chemicalcomMonsantoused to be a capitalintensive,
largelycommodity
on
pany. Now, it seeks to be a highvalue-addedcompanyconcentrating
its
to
the
strategy,
company's
proprietary,
patentedproducts.According
business ultimately
willbe dividedequallyamongthreeareas: chemicals,
3
products.
engineeredproducts,andbiology-based
To achievethisturnaround,
itsorganization,
Monsantocutcosts,realigned
and investedheavilyin research.By 1984, about $2 billionin marginal
businesseshadbeendivestedandthenumber
ofemployeeshasbeenreduced
from64,000 to 51,000 to reducethefirm'sbreak-evenpointsignificantly.
Two layersofmanagement
wereeliminated,
a matrix
system
management
more
distributed.
and
installed, decision-making
authority widely
culturalimplications.
Such a redirection
was boundto have significant
Monsanto'sChiefExecutiveOfficer
Richard
J.MahoneytoldFortunemagazine that"it has all been a verybig culturalshockforpeoplewho were
has been."4The comaccustomedto the way thepetrochemical
industry
ratherthanheavycapital
pany's futurewillhingemore on brain-power
moreon risk-taking
ratherthantraditional
caution.As Fortune
investment,
so thecompany's
is
on
outside
Monsanto
far
less
forces,
noted,
dependent
ona steady
will
their
to
have
to
stretch
talents
the
keep
company
managers
course to the 1990s.
thosewithissuemanagement
units,including
responsibiliCorporatestaff
were
of
the
redirection
effort.
Fourteen
also
ties,
studyteams
part
corporate
scrutinizedstafffunctions
to see iftheywere relevantto the "newMonandtheimplementasanto."5 These staff
studies,themajorreorganization,
tionofthenew strategyset thestageforchangesintheissuemanagement
function.
At the time, Monsantoalreadyenjoyeda nationalreputation
forits
issues and socialtrends.6During1980and
programsto identify
emerging
of 13 keyand senior
1981, an Issue Identification
Committee,consisting
7These issues
identified
of
to
10
broad
issues
concern
Monsanto.
managers,
includedglobal competitivechallenges,the managementof technology,
ofmultinational
busihumanresourcesmanagement,
andthemanagement
ness. In 1983, theywere reviewedagainby a CorporateAdministrative
to
Committee.A high-level
was also formed
EmergingIssues Committee
trends.
This
focustopmanagement
attention
onlong-term
issuesandsocial
programcontinuesand is an important
part of the company'splanning
process.
Witha good systemin place to identify
criticalemergingissues on a
in
turned
hisattention
to shorter-term
basis, 1983Mr. Mahoney
long-term
issues. Soon afterassuminghis dutiesas CEO, he soughtto identify
the
112
STEPHENE. LITTLEJOHN
whichissuesdeservedcorporate
mechanismused byMonsantofordeciding
he wantedto be surethathe andhisfellowsenior
attention.In particular,
executivesweremaking
thebestuse oftheirtimeinthepublicissuesarena.
thepublicissues
His concernset inmotiona multi-month
effort
toprioritize
thatmatteredmostto Monsanto,andon whichMonsantocouldexertthe
the companywere ingreatestinfluence.Staffand lineunitsthroughout
volved, in additionto the top-levelExecutiveManagementCommittee
chairedbyMr. Mahoney.
Attheoutset,a distinction
was drawnbetweentrendsandissues.A trend
did not have sufficient
formor substanceto be affectedsignificantly
by
deliberateoutsideforcesseekingtoshapeordirectit.Anissue,ontheother
ofitsown,and
thatwas aüve,hada momentum
hand,was seen as something
As oneinternal
was capableofbeingmodified
as itmovedtowardresolution.
documentexplained,the distinction
was made to ensurethat"we don't
"
squanderexecutivetimeorresources.
Additional
criteriawereused tonarrowthenumberofissuesconsidered
fortop prioritystatus. Includedamongthe criteriawas theimpactofan
The outcomeofthe
issue on the company'sassets andbusinessdirection.
issues also had to be uncertain,makingthemsusceptibleto beinginfluenced.As one seniorexecutiveasserted,the companyshouldselect
issues "we can do something
about."Finally,theissues had to be active
withintwoyears.
ofthebroaduniverse
The prioritization
processbeganwitha cataloguing
ofissues facingMonsanto.Manyissue listswerealreadybeingmaintained
by a numberof units, such as governmentaffairsand environmental
areas across the
functions.Experts who deal withissues in different
A
companyalso were asked to list the ones they saw as important.
of
sumissue
Issues
a
Public
Book, containingrange
periodicallyupdated
issueswere
maries,servedas a base too. Ultimately,
nearly170 different
identified
usingthis"wholeuniverse"approach.
The nextstep involvedsortingandevaluating
theissues, inthiscase on
basis. The purposewas to providemanagersand
a division-by-division
plannersin each partofthe companywitha shortlistofissues keyedto
theirdivision'soperations.Then, a probability/impact
gridwas used for
howeach issue couldaffectthecompany,
andthe
each divisionto identify
on
of
issue
an
each
Monsanto.
actuallyhaving impact
probability
ComAt thispoint,Mr. MahoneyconvenedtheExecutiveManagement
mitteeto reviewthe resultsofthe prioritization
process and to map-out
whatthe companyshoulddo abouta selectnumberoftoppriority
issues.
decideduponfivetopcorporate
Aftertwomeetings,thecommittee
issues,
the
and
ordered
to
senior
for
issue
a
each
executive,
assignedresonsibility
developmentofdetailedactionplans.
In February1984, the companynewspaper,MonsantoWorldNews,
announcedthe selectionof"fivecriticalpublicpolicyissues" by
formally
PUBLICISSUEIDENTIFICATION
ANDRESOLUTION
113
the ExecutiveManagement
On the listwerefairtrade,
Committee.8
intellectual
biotechnology
regulation,
rights,
agricultural
property
policy,
and hazardouswaste/public
Each was closelylinkedto
compensation.
andstrategy:
Monsanto'sbusinessposition
fairtrade,becausethecomin
100
business
over
bedoes
countries;
pany
biotechnology
regulation,
cause success in thebiological
sciencesis crucialto thenewcorporate
becauseofthecompany's
restrategy;intellectual
protection,
property
lianceonproprietary
becausethefarm-belt
is
agricultural
products;
policy,
one ofthecompany's
and
hazardous
commarkets;
principal
waste/public
costscouldbe
pensation,because cleanupandpotential
compensation
quitesignificant.
These issueswereselected,according
tothencompany
Louis
chairman
because
the
Executive
decided
that
Committee
Fernandez,
Management
therewerea handful
ofissues"so critical
toMonsanto's
future"
thateach
one shouldbe assignedtoa member
ofthecommittee
forclosemonitoring
andaction.He tookresponsibility
forthehazardous
compenwaste/public
sationissueandMr.Mahoney
tooktheassignment
forthefairtradeissue.
Othersenior-level
executives
tohandle
theremaining
issues."If
signed-on
we arebold,ifwecontinue
forourinterests
withdetermination
and
battling
we
will
of
the
in
ahead
terms
of
our
to
creativity,
emerge
pack
ability
and
asserted
Dr.
Fernandez
at
Monoperatesmoothly successfully,"
santo's 1984 Management
Conference
duringremarksaboutthe five
issues.9
ofthecloseassociation
betweenissuemanagement
at
One indication
ofMonsanto's
Monsantoandtheachievement
is the
strategic
objectives
format
usedfordeveloping
issueactionplans.Itisthesameformat
usedby
all management
to establish
theperformance
employees
goalsonwhich
are
For
evaluated
each
andaction
they
issue,specific
annually.
objectives
theplansis checked
Performance
and
stepsareoutlined.
against
routinely
theexecutivesresponsible
foreachissueprovide
theExecutive
ManagementCommittee
withperiodic
reports.
Each planincludesactivities
orcoalition
basedoncooperation
building.
In connection
withagricultural
founded
a Washingtonpolicy,Monsanto
basedpolicyprojectcalled"Dialogue"
toadvancediscussion
a range
among
ofgroupsofnational
and
ofa
food,farm, agricultural
policies.Adoption
role
the
Council
for
U.S.
with
and
the
in
National
Trade
China
leadership
U.S. -U.S. S. R. TradeandEconomic
waspartofthefirst
Council
fairtrade
ofintellectual
plan.In orderto improve
abroad,the
protection
property
coalitions
Fairandsenestablished
countries.
keyedto specific
company
ofbiotechnology
the
sibleregulation
federal
also was a
by
government
of
inthiscase, work
efforts
goal Monsantocoalition-building
involving,
withtradeassociations,
think
interest
andacademia.
tanks,
public
groups,
oncooperative,
The greatestreliance
isoccurefforts
coalition-building
in
the
waste
with
to
environmental
hazardous
ring
area,especially respect
114
STEPHEN E. LITTLEJOHN
issues. As a result,Dr. Fernandezemergedas a national
leaderin a
movement
between
and
toward
constructive
dialogue
industry
growing
in
the environmental
"I'm
be
involved
to
continue
to
community. going
thatwillpromote
betweenindustry
andenvironmental
dialogue
anything
ofdump
thatwillpromote
clean-up
groupsandI'm goingto do anything
10
he
then
one
interview.
to
the
said
sites,"
during newspaper
According
PresidentoftheNational
Dr.
Audubon
Society,Dr. RussellW.Peterson,
Fernandezhad "certainly
his willingness
to talk and
demonstrated
listen."11
The originofDr. Fernandez's
venture
intoenvironmental
cooperation
of
canbe tracedtoanessayintheWashington
Palmer
PostbyChristopher
the AudubonSociety.12WhenMr. Palmersuggestedthatbusinessand
environmental
andcooperagroupsshouldseekoutareasforcompromise
In
Dr.
Fernandez
an
also
tion,
bythePosthe
responded. essay
published
13
agreedwithMr. Palmer. Sincethen,he workedwithenvironmental
waste
leadersonprojectsranging
from
wetland
andhazardous
protection
in
to
the
Protection
an
increase
Environmental
(EPA)
Agency's
clean-up
researchanddevelopment
budget.In a speechbeforetheConservation
onEnvironmental
Foundation's
SecondNational
Conference
DisputeReofa forum
forregular
solution,he proposedtheestablishment
meetings
betweenseniorindustry
andenvironmental
leaders.14
His proposalforregularmeetings
is designedto sustaina seriesof
forcoopinformal
consultations
opportunities
begunlastyearto identify
eration.One resultof thesemeetings
was thejointprojecton EPA's
researchbudget,whichledto a jointappearance
earlierthisyearbyDr.
SubFernandezandDr. PetersonbeforetheU.S. SenateAppropriations
insupport
committee
onH.U.D. andIndependent
Bothtestified
Agencies.
ofanaddition
of$101million
tothe$163million
fiscal1985budget
request
15
ofEPA's Office
ofResearchandDevelopment.
the
The wetland
within
a morestructured
framework,
projectoccurred
Council.EstabNationalWildlife
Federation's
Conservation
Corporate
contheCouncil
lishedbyJayHair,president
oftheWildlife
Federation,
The
sistsofa smallgroupofbusinessleaders,including
Dr. Fernandez.
to discuss
withofficials
oftheWildlife
Federation
panelmeetsquarterly
controversial
issues beforetheyreachthepublicarena.In
potentially
inissuing
a
oftheCouncil
1984,Dr. Fernandez
joined11othermembers
that
statement
for
the
of
business
management
plans
calling
"development
willallowtheutilization
inwetlands
butwillalso
ofthevaluable
resources
" 16
conserverenewable
wetlands
valuesinperpetuity.
efforts
was CleanSites,
ofthecooperative
By farthemostambitious
to help
and
a
between
environment
Inc., partnership
groups industry
17
ofdiscussions
ofhazardous
wastesites. Theproduct
speedtheclean-up
thebetterpartoftheyear,CleanSiteswasformally
established
spanning
inMay1984.Ithadthreemainfunctions:
involved
tobring
together
parties
PUBLIC ISSUE IDENTIFICATION AND RESOLUTION
115
inwastesitestohelpthemdivide
costsfairly,
toassistthemin
upclean-up
will
that
meet
EPA
and
the
standards, tomanage
clean-up
developing
plans
EPA Adclean-upofcomplexsites.CleanSiteswas chairedbyformer
ministrator
ofindiRussellE. Trainanditsboardofdirectors
consisted
vidualsfromenvironmental
and
Dr.
groups,academia, industry,
including
Fernandez.
efforts
initiated
Manyofthecooperative
byDr. Fernandez
gottheir
startduring
histermas chairman
oftheChemical
Manufacturers
Association(CMA). The term"creativecooperation"
has beenusedto characterizehisinitiatives
attheheadoftheorganization.
toRobert
A.
According
"he puttheassociation
inthepathof
Roland,CMA's president,
firmly
withothergroups."18
Hisefforts
didnotdiminish
after
relincooperating
the
CMA
He
became
a
of
of
board
trustees
member
the
quishing
post.
whichsponsorsconKeystoneCenter,a Colorado-based
organization
issues. However,themost
sensus-building
projectson environmental
ofDr. Fernandez's
efforts
at"creative
significant
impact
cooperation"
may
occur
within
where
some
Monsanto,
ultimately
interesting
cooperative
19
efforts
haveoccurred.
WhenOhioGovernor
Richard
Celestesigneda hazardous
wastemanin
statute
into
law
Monsanto's
Gerald
Osterman
wasthere,
agement
1984,
with
of
the
Sierra
months
Club.
Seven
along
representatives
earlier,
andtheenvironmental
inColumsat downtogether
industry
community
bus,Ohio,tosee iftheycouldagreeonthebestwayforOhiotoamendits
hazardouswastelaw.ThemeasuresignedbyGovernor
Celesteemerged
fromtheirdiscussions
andwonlegislative
without
approval
change.
Mr. Osterman
was invited
to theOhiosigning
becausetwo
ceremony
linesofcommunication
yearsearlierhe hada lotto do withestablishing
betweenindustry
andenvironmental
thestagefornegotiactivists,
setting
ationsonthenewhazardous
wastemanagement
law."Atthebeginning,
it
was a challenge
toworkwithpeoplewhosee things
butafter
a
differently,
fewmeetings
we found
thatwe agreedona surprising
number
ofissues,"
said Mr. Osterman,
whoworkedat Monsanto's
PortPlasticsplantnear
Cincinnati.
In somestates,theuse ofconsensus
hada successful
building
already
trackrecordofseveralyears.Forexample,Monsanto's
Pensacolaplant
considersthe development
of goodrelations
withlocalenvironmental
leaderstobe therule,nottheexception.
Thus,itmadesenseforJoeVick,
thenintheplant'senvironmental
toserveona broad-based
group,
groundwatertask forceconvenedby Florida'sDepartment
of Environmental
Threeyearsofworkbythetaskforceled to groundwater
Regulation.
whichhas beenon thebookssince1982.In 1984,consensus
regulation
andlaborreachedagreement
on a
building
provedusefulwhenindustry
hazardcommunication
law.
116
STEPHENE. LITTLEJOHN
GulfOil Corporation
Now a subsidiary
ofChevronCorporation,
at the
GulfOilbeganitshistory
turnofthecentury
witha wildcatoilwellcalled"Spindletop"
nearBeaumont,
Texas. The wellproduceda gusheronJanuary
10, 1901,andthecompany's
was builtnearbyto processthecrude
huge PortArthur
refinery
ultimately
forsale as gasolineandlubricants.
of
was alsothebeneficiary
Later,thefirm
millionsofbarrelsofcrudefrom
concessionsinVenezuela(1923)andKuwait
and gasoline
and marketing
(1934). Refineries,transportation
facilities,
it.
servicestationswerebuiltthroughout
theworldto distribute
inThe 1970s broughtfundamental
changesto Gulfand thepetroleum
dustry.Formerly
ampledomesticreservesbegantodeclineandGulflostits
foreignconcessions.Then,as theworldpriceforoilshotupward,economic
becamepopular,andpetroleum
activitysloweddown,energyconservation
inlowerearnings
for
demandsoftened.Consequently,
pricesfell,resulting
petroleumcompanies.Finally,withthe removalof federalcontrolson
20
thepetroleum
businessbecamefarmorecompetitive.
marketing,
overitsfuture
thefirm
UnderMr. Lee's leadership,
soughtmorecontrol
thesebusinessgoals:
byadoptingandpursuing
• replace domesticreserves of hydrocarbons
througha changein exareas like
plorationstrategy,nowto be focusedon moreriskyfrontier
theOuterContinental
ShelfandAlaska;
• regainpositionas a topmarketer;
• maintain
infinancial
consistent
growth
position;and
• acquire and develop non-petroleum
energyresourcesas economics
permit.21
itselfinlinewiththemarketWiththese goals, Gulfsoughtto restructure
place.
The biggestchangeat Gulf- priorto its 1984acquisition
byChevron
in
hired
to
firm
was
came 1983. The consulting
help
McKinseyandCompany
the companyfindways to reduce overheadcosts. A highlydetailed
McKinseyexercisecalledoverheadvalueanalysisputmuchofthecompany
undera microscope.One resultwas theelimination
ofover$100 million
a
of
The
also
sold
administrative
and
overhead
costs.
marginal
company
year
or unprofitable
businessessuchas Europeanrefining
andmarketing
operainnewrefining
It also made
tions,whileinvesting
equipment.
domestically
some progresson theexploration
front
60 percentofitsU.S.
byreplacing
22
production.
Gulfwas notabletoachieveitsturnaround
enough.In
quickly
Ultimately,
a whitepaperissuedat thetimeofitsmergerwithChevron,Gulfsaid,"This
because
affect
Gulfsshort-term
profitability"
progressdidnotsignificantly
on future
the steps were chosenfortheirlong-term
effect
Gulfoperations.
The paper wenton to say that"Gulfstockremainedundervalued
andthe
and aggressivegroupof
companybecame the targetof a well-financed
PUBLIC ISSUE IDENTIFICATION AND RESOLUTION
117
" 23
andagreedonMarch5,
speculators. Chevronenteredas a "whiteknight"
assets to
1984 to acquire Gulf.The later sale of some Gulfmarketing
StandardofOhiofinalized
themerger.
of
theevolution
Nevertheless,Gulfstillservesas a goodcase toillustrate
In 1980,before
issue management
duringa periodofbusinessredirection.
socialandpolitical
trends,and
majorinternal
change,thestudyoflong-term
theirpotentialimplications,
were conducted
was underway.Experiments
withscenario-generating
andpolicyanalystsweresent
computer
programs,
to observe a futuresconferencein Toronto.Supportwas also givento
futurist
ofSouthernCaliand theUniversity
projectsat SRI International
fornia.However,by theend of 1983,a Gulfpublicaffairs
executivetolda
that"we are now
regionalPublicRelationsSocietyofAmericaconference
inthe
businessobjectiveswithspecific
factors
rigorously
correlating
specific
in settingpublicaffairsstrategies."24
He explained
externalenvironment
thatthe petroleummarketplace
and thatall elewas fiercely
competitive
mentsofa company'sperformance,
werepartofthe
including
publicaffairs,
bottomline
equation.
In 1981, Gulfbegan installinga systemforidentifying
and ranking
ona strategy
issues, andassessingtheirdollarimpact.Undertaken
priority
inGulfOilChemicals
centerbasis, thesystemhaditsfirstimplementation
Initially,
Company(GOCHEM), witha "publicissues strategyproject."25
the presidentofGOCHEM askedmorethan70 peopletoreviewa prelimiadd anyissues whichhad been
naryissue listpreparedby publicaffairs,
omitted,and rank the issues by priority.The response rangedfrom
fromthe
marginalnoteson thelisttoextensiveandperceptivememoranda
fieldand fromheadquartersstaff.
Evaluationoftheproject'sinitialresultswas a two-stepprocess.First,
fifteenmembersofthe surveygroupwere asked to meetwiththepublic
affairsstaffmanaging
theprojecttodiscusstheissues andtoagreeonissue
Those
selectedto attendthe meetingwere thosewho
priorityrankings.
had providedespeciallyinsightful
commentsduringthesurveyorwhoheld
the
particularly
important
positions.The secondstep involvedpresenting
resultsofthe surveyandthediscussionsessionto theGOCHEM Executive Committee.
In both cases, the following
criteriawere used to sortthe issues into
three prioritycategories. Categoryone containedissues whichcould
whichcould
seriouslyaffectthe company'sabilityto operateeffectively,
be
influenced
the
probably
by
company'sefforts,and about whichthe
companyhad some expertise.Categoriestwo and threewere forissues
that deserved to be monitored.They differed
onlyin thatthe company
would be more preparedto act, ifnecessary,on categorytwo issues.
was meantto be givento category
However, almostexclusiveattention
one issues. Once the top issues were selected, GOCHEM's president
for takingaction on them to a handfulof key
assigned responsibility
executives.
118
STEPHENE. LITTLEJOHN
The results of the GOCHEM publicissues strategyproject,and of
similarprojectsconductedby otherstrategycenters,were thenused by
the corporatePublicIssues Committeeto establishissue priorities
based
on corporateobjectives.The committee
consistedoftopoperating
executivesandwas chairedbytheVicePresidentforPublicAffairs.
to
Reporting
the CEO, the committeemetroutinely
to monitor
issue
corporatepublic
activitiesandreviewcorporatepositionsonpublicissues, as wellas to set
issues were thensummarized
bythePublicAffairs
priorities.All priority
"Politicaland Social Challengesfor
Departmentin an annualpublication,
Gulf."
issues identified
bythePublicIssues Committee
Amongthetoppriority
were naturalgas decontrol,
theleasingoffederallandsforenergydevelopment, and taxes, each of whichrelatedto the corporateobjectiveof
betweenpetroincreasingenergyreserves.Concernovertherelationship
leummarketing
andthegoalto be a topmarketer
legislation
putthisissue
on the top priority
list. Environmental
issues, especiallythoseinvolving
hazardouswaste, publiccompensation,
and the OuterContinental
Shelf,
the
list
because
theywereconsideredtohavea role
completed toppriority
in each ofthefirm'sstrategicobjectives.26
At Gulf,theeffort
to achievea sharperpublicaffairs
focuson corporate
business objectiveswent beyondissue identification
and prioritization.
The numberofstatescoveredbythepublicaffairs
fieldstaff
was narrowed
to just those where the companyhad marketing
or production
investfrom
ments.Moreover,someofthesestaff
were
central
people
dispersed
to
them
locations
to
district
offices
enable
and
refinery
regional
marketing
to stay on top of rapidlychangingmarketand businessconditions.The
werealso reevaluconstituencieswithwhichthecompanycommunicated
ated. Instead of spendinggreat sums on corporateimageadvertising,
where it was difficult
to assess results,Gulfdevotedmoreresouces to
buildinggrassrootssupportforits positions,and to developingrelationconstituencies.
shipswithimportant
In fact,coalition-building
were centralfeatures
and cooperativeefforts
ofGulfs publicaffairs
on
the
issue ofnaturalgas
For
strategies. example,
use ofnewslettersanddirectmailto keep
decontrol,Gulfmade effective
to
aboutkeyissues andawareofopportunities
likelysupportersinformed
communicatewithlawmakers.On the otherhand,withenvironmental
a dialoguewithenvironmental
andconservaissues, it soughtto maintain
tion group. These effortsat improvedcommunication
and cooperation
grew out of a recognitionthat,in pursuitof corporateobjectives,enefforts
nearparks
counterswiththesegroupswouldbe partofexploration
and wildernessareas, and ofthe transportation
ofproductsnear shorelines. "The outcomes(ofthese businessactivities)frequently
dependon
the qualityofourrelationship
withenvironmental
andconservation
groups
and most especiallyon our reputationforgood environmental
perfor"
executive.27
mance, said one Gulfpublicaffairs
PUBLIC ISSUE IDENTIFICATION AND RESOLUTION
119
To improveits ties withenvironmental
and conservation
groups,Gulf
on
conservation
the
launcheda "multi-faceted
based
following
program"
principles:
• Environmental
issues shouldbe discussedwiththepublicandlawmakers on environmental
grounds,andnotsolelyonthebasisofeconomics.
• Environmental
policymaking
by our nationmustinvolvecooperation
betweenbusinessandenvironmentalists.
• Gulfcan positively
itselffromotherpetroleum
distinguish
companieson
matters.
environmental
• Gulfwillno longerbe able to just followregulations
andfeelconfident
thatithas doneallthatitshould.28
The potentialofthethirdpremisewas demonstrated
in 1983whenGulf
became the firstcorporation
to receivetheMountainofJadeawardfrom
The OutdoorWritersAssociationinrecognition
ofits efforts
on behalfof
Atthattime,Mr. Lee assertedthat"if
conservationandtheenvironment.
government,business, and involvedcitizenscan cooperate,I am convincedwe can have thebest ofbothworlds- a clean,healthy,
andbeauti"29
fulenvironment
andcommercial
andbusinessprosperity.
The flagshipofGulfsrealtionship-building
effort
is theGulfOil Conservation Awards Program,withwhichGulfbecame associated in 1982.
Consideredby manyto be thepremierawardsprogramforconservationists, it had been sponsoredsince 1954 bytheAmericanMotorsCorporation.It openedthedoorsoftheconservation
to Gulfandhelped
community
the firmdistinguish
itselfas a leader in environmental
and conservation
matters.Leaders ofconservation
and
federal
environmental
organizations
agencies recommendcandidatesfor the awards and attendan annual
wheretheawardsare conferred.
ceremonyinWashington
Gulf also demonstratesits commitment
to naturepreservationin a
substantialwayeach yearthrough
a majorcontribution
toa specific
project
in a state criticalto Gulfsfuture.In 1982,Gulfservedas a pacesetterfora
$250,000 programto protecttheWhiteRocksNatureAreanearBoulder,
Colorado. The directorofthe NatureConservancytoldtheDenverPost
that"Gulfhas been one oftheConservancy'smostvaluedbackers."30In
ofthisGulfpro1981, NorthDakota's Cross Ranchwas the beneficiary
NatureConservancy
drive
gram.There, itsgrantwas partofa $2.7 million
to purchase the ranch,whichincludedthe largest one-ownernatural
stretchof the MissouriRiver."Gulfhas been a majorpart[oftheRanch
"
andwe appreciateit, said thedirectoroftheNature
Preservationeffort]
Conservancy'sNorthDakotaFieldOffice.31
On a larger scale, Gulfs supportof NationalGeographictelevision
"BirdsinArt"exhibition
withtheLeigh
affiliated
specials and a travelling
the
YawkeyWoodsonArtMuseuminWausau,Wisconsin,demonstrated
firm'sassociationwiththesupportfornatureappreciation
andprotection.
Special previews of each season's NationalGeographicspecials were
120
STEPHENE. LITTLEJOHN
and conservationleaders in Washington,
San
staged forenvironmental
Francisco, and New York.Manyof these same leaderswere invitedto
whichwas also popular
special showingsofthe "BirdsinArt"exhibition,
withthe public.For example,in Pittsburgh,
morethan12,000persons
viewed the exhibitin 1982 and a special featureon it appearedin the
Press Sundaymagazine.32
Pittsburgh
Finally,Gulfsupportedprojectsthatseek to bridgethe gap between
bothnationally
andgovernment,
industry,the environmental
community,
and internationally.
The firm
was a majorsponsoroftheKeystoneCenter
inColorado.The presidentofGOCHEM servedas chairman
ofKeystone's
Board ofTrustees. Internationally,
Mr. Lee was a convenorofThe World
IndustryConferenceon Environmental
Management,sponsoredby the
United Nation's Environment
Chamberof
Program,the International
in
and
the
Business
In
Roundtable.
the
Conference
Commerce,
1984,
Paris provideda forumwhereindustry
and government
discussedmore
effectiveapproachesto environmental
problemsolving.Mr. Lee saw the
conferenceas an opportunity
forindustry,government,
and environmentaliststo enlargetheircommongroundand reduceconfrontation.
"I
believe it's one way to identify
some promising
areas of potentialcon" saidMr. Lee. 33
sensus inthefuture,
Conclusion
The case historiesof Gulfand Monsantoarguethatnew trendsmaybe
emergingin corporateissue management,
largelyas a resultofcorporate
inthedirection
of
repositionsduring1980s. One trendappearstobe moving
The other
focusforthe issue management
function.
greatercompetitive
andcoalitionappears to be movingtowardgreaterrelianceon cooperative
ofissues. Ratherthanbeingconbuildingstrategiesforthe management
issue
thetwotrendsare infactcomplementary.
By harnessing
tradictory,
in
to
the
achievement
of
a
competitive
management
corporateobjectives
sense - firmshavefoundboththeneedandtheability
toform
coalitions
and
on
cooperativeventuresinordertoachievetheirgoals.Monolithic
positions
issues suchas therelativerolesofgovernment
andtheprivatesectorhave
toaddressproblems
givenwaytopractical,
underlying
cooperative
attempts
issues.
Taken
the
two
trends
constitute
an
specific
together,
approachto
issue management
whichcanbe calledcompetitive
cooperation.
Reviewingthetwocases, we findthatbothMonsantoandGulfunderwent
to exert
major strategicredirections
duringthe early1980s. In an effort
more controlover theirdestiniesin thefaceofexternalforces,theyeach
adopted bold, riskystrategies.Monsantodecidedto bet on its research
abilitywhere it had special expertiseto producethe highvalue-added
The firm'sgoalis to divideits
productson whichit plansto concentrate.
business equallyamongthreeareas: chemicals,engineered
products,and
to
its futureon
Gulf
concluded
that
it
had
stake
biology-basedproducts.
PUBLIC ISSUE IDENTIFICATION AND RESOLUTION
121
intheUnitedStates,especiallyon
discoveringlargereservesofpetroleum
the Outer Continental
Shelf.It also began to make the toughdecisions
ofpetroleum
necessaryto regaina toppositionas a marketer
products.
In additionto defining
theirgoals explicity,
bothcompaniesthoroughly
evaluatedwhethertheircurrentorganizations
were structured
to achieve
thosegoals. Thisevaluation
involved
bothlineandstaff
those
units,including
functionswithissue management
duties.Monsantodivestedbusinesses,
reduced costs, and implemented
a matrixmanagement
system.Gulfalso
divestedbusinessesandinvestedmorefundsinexploration
andinimproved
in
for
both
issue
refining
management
capacity.However,
companies,staff
studies also had an impact.At Monsanto,studyteamsassessed whether
functionswere relevantto the "new Monsanto."At Gulf,the McKinsey
misCompany'soverheadvalue analysistested whethereach function's
were
for
the
of
the
and
achievement
sions, activities, "products"
necessary
corporation's
strategicgoals.
Issue management
survivedtheintensescrutiny.
In fact,forbothcomin
it
more
factor
the
ofcorporate
as
a
crucial
achievement
panies, emerged
tobe leftsolely
goals. Some mightevensaythatithadbecometooimportant
in the hands of the issue managers.Top-levelcorporateexecutivesand
business managersbeganto assumea moredirect,hands-onroleinissue
led to changesin the
management.However,thisincreasedimportance
issue management
function.
AtMonsanto,focuswas placedon issues "we
"
can do something
about, thatis, issueswhichareactiveintheshortterm,in
additionto long-range
trendswhichcouldnotbe significantly
affected
by
actions.
At
more
attention
was
to
correlatGulf,
corporate
given "rigorously
ingspecificbusinessobjectiveswithspecificfactorsintheexternalenviron"
ment. In bothcases, possiblybecause oftheinvolvement
oflinemanagementandthedesiretoinfluence
issues so thatcorporate
objectivescouldbe
" to use a termoftenheardin
the
issues
to
be
had
achieved,
"actionable,
executivesuites.
The mechanismsused by GulfandMonsantoto identify
issues,
priority
such as surveys,discussiongroups,and priority/impact
were
not
grids,
oftop-levelexecutives,howespeciallynovel.The extensiveinvolvement
ever, could representa departure.Monsanto'sExecutiveManagement
Committeemettwiceto finalize
itslistoftop-priority
issues. Then,members of the committeetookpersonalresponsibility
fordevelopingaction
theChiefExecutiveOfficer
oftheBoard.
andtheChairman
plans,including
At Gulf,a PublicIssues Committee
metregularly
to assess issuepriorities
and to monitor
actionprograms.
Withsuchinvolvement
oftopexecutivesandbusinessmanagersinissue
it
shouldcomeas no surprisethatfamiliar
managementprograms, probably
problem-solving
techniqueswereappliedto thetask.The careful
linkageof
issue priorities
to corporateobjectivesandthedevelopment
ofactionplans
to makethefirm
morecompetitive
is aneveryday
process.The sameis true
122
STEPHENE. LITTLEJOHN
fortheuse ofcooperation
andcoalition
becausepractical,
negotiated
building
solutionsto problemsare mainstays
ofbusinesssuccess. Therefore,
such
are
elements
of
issue
each
strategies
management
important
company's
actionplans.It is one oftheprinciples
ofGulfsenvironmental
and
program
Dr. Fernandezhas assertedthat"cooperation
is thepractical
wayto go for
"34
andtheenvironmental
industry
community.
Thus, competitivecooperationis not reallynew. Whatis new is the
extensiveinvolvement
ofbusinessleadersintheworkofissuemanagement.
Dr. Fernandezmay have put his fingeron whatis happening
whenhe
addressedtheChemicalManufacturers
Association
at thecloseofhisterm
as chairmanofthegroup."I wouldargue," he said,"thatwe mustmanage,
as businesspeoplemanaging
businessproblems,thedelicatetaskofbringthese
issues
to
the
arena."35
ing
public
References
Noteon Sources:This articleis based on theauthor'sexperiencesas seniorpolicyanalystat
GulfOil CorporationfromJuly1980 to April1984, and as manager,policyanalysisand
fromMaytoDecember1984.
at MonsantoCompany
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Post,September
9,
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2. Ibid.
3. For discussionsofMonsanto'snew strategy,
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in
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