In the quest to achieve its strategic objectives, an entity has to ensure that it has sound issue management practices in place to meet the expectations of its stakeholders, externally and internally. OER looks at what issue management is all about and its growing importance in today's increasingly complex corporate world
The need for a strategic 'common sense' approach to managing business issues has never been more important for any entity, specially when radical changes are taking place at national and international levels. 
Issue Management
Teresa Yancey Crane, founder of the Issue Management Council and part of the team that developed the first Issue Management Process Model in 1977, said one must as: "think of an issue as a gap between your actions and stakeholder expectations."
An issue can be defined as "an emerging or unresolved matter which can impact the business and affect reputation; or the 'gap' between what an entity says and does, and what stakeholders expect it to say or do."
Issue management is the process used to close that gap. There is more than one way to do this. An organisation can adjust to meet expectations by creating a new product, or modifying operations. In this case, an issue is managed by division heads or line managers. The gap may also be closed by accommodating through policy decisions. For example, a policy of sustainable forestry will drive operations and individual action in many ways. Here, the board of directors outlines the policy while the senior management implements it. Another way the gap may be closed is by changing constituent expectations; for example, providing public education on product testing, or community dialogue on safety procedures. In this case, expectations are changed through communications' expertise. Most likely, an organisation applies a combination of all of these strategies.
Issue management involves many parts of an organisation. This is why it is unique from traditional strategic planning, or corporate governance, or public relations. Issue management provides the mechanism for all of these functions to work in a team on one specific objective - closing the gap, or managing the issue. Issue management is like preventive medicine and all businesses need care and attention to prevent any potential damage to reputation.
The Power of Perceptions
How an entity sees itself may not always be the same as how others see it. What an entity says and how it is perceived is affected by a range of factors, including culture, language, religion, education and nationality. All these contribute to public perception about that entity.
This difference in views has implications on various issues for a business. Within an entity, we may see 'facts' in a certain way-and they may seem very clear to us. But people outside may have a completely different - sometimes irrational - view; they may see them through layers of perception or emotion built on cultural and other differences. We need to understand this, see ourselves as others see us - or do some 'outside-in thinking'.
Value Addition
Issue management creates value and benefits across a broad spectrum, externally and internally.
Externally:
Improved stakeholder relationships and 'dialog of mutuality' that avoids or mitigates conflict and leads to win/win resolutions that account for the positions and goals of all members in the stakeholder ecosystem
Speed to market with product and services relevant to unmet 'demand' or expressed concerns
Reduction of 'communication noise' in the marketplace that can impede efficient and competitive organisational performance
Destruction of barriers to market entry and operational constraints
Socially 'response-able' management
'Reality check' for internal perceptions and plans versus external realities, offering a filter for an organisation's strategic initiatives
Internally:
Enterprise-wide (boundary-spanning) management and synergistic, efficient resource allocation
Timely and contextually-relevant communication or organisational goals vis--vis issue impact thereby improving capacity for individuals to 'speak for' the organisation
Improved teamwork, morale and productivity through understanding organisational strategy and individual roles relative to issues' effect on goals
Issue accountability through the assignment of an 'issue champion'
Reduction of 'surprises' and uncertainty with reduced liability for directors and officers
Crisis avoidance and 'success' through things that didn't happen
Issue management process
There are different models of issue management followed across the world. Petroleum Development Oman (PDO) follows a seven-step process for issue identification and management. This model has been developed over several years and is used by several top global companies (see graph - Issue Management Process).
In Monitoring, the first step, the owners of issue management in an entity keep reviewing the company's functioning and the eco system in which it operates to sniff out any development that can lead to an issue. In the second step, Identification, as a result of constant monitoring, certain primary issues are identified that need to be considered as part of the IM process. If there are multiple issues that need to be addressed, they are prioritised as per the urgency and the importance in the third stage, Prioritisation.
Moving on, the major focus of the fourth step, Analysis, is to draw on past experience with the issue, as reflected in quantitative and qualitative research on how people feel about the issue, what actions have been taken, how the company is geared for dealing with it, and in general, how the issue can impact the organisation.
Next step is Strategy Decision. Basically, each issue requires a carefully determined "stance". It may be desirable to let others take the lead, remaining in a reactive mode. Perhaps it is best to "go with the flow" and adapt where necessary. Or, a dynamic posture may be taken. This whole step is designed to incorporate an element of strategy into plans and actions.
The sixth stage is Implementation. The components of action include setting a goal, objectives, strategies and tactics. Then, one has to organise all resources at hand to achieve targets that are set. The emphasis should be on tapping and synchronising all parts of the organisation.
The final step is Evaluation where the focus is on the evaluation of results. At times, the issue management cycle begins again, with new players, new results, new attitudes and so on. The dynamic nature of this process is what makes issue management a fascinating field. The results, in terms of change effected and synergy realised, are very powerful.
At PDO, each issue has an "owner" - generally a company director - who works with issue-management advisors to ensure that the seven-step model is followed and implemented rigourously.
Prime Example - Omanization
Despite the pressure of the complexities involved with oil and gas exploration and production, PDO's sustainable drive to create highly skilled Omani technical professionals capable of facing the technical and business challenges of the future is a fine example of how it has successfully managed the Omanization process. Today, PDO employs more Omanis than any other private-sector company in the Sultanate.
HE Dr. Mohammed bin Hamad al Rumhy, Minister of Oil and Gas and Chairman of PDO's Board of Directors, is all praise for the efforts of PDO on the Omanization front. "The oil and gas industry is at the front row of Omanization and we have had more success than in any other sector. We are a model for other industries to copy. Our training and human resource development has been very good and the transfer from PDO's Omanisation campaign to contractors has also been very successful. And we are reaping the benefit in light of the shortage of people in the market. We are in a better situation compared to neighbouring countries and this is largely due to PDO's Omanisation policy undertaken in the last 20 years," he said in an interview with Al Fahal (December 2006), PDO's monthly newsletter.
Issue Management Made Easy
What is reputation?
Reputation is the sum of people's attitudes, associations and expectations towards an individual or an organisation. Although it is difficult to value, it is a vital asset that can be easily lost.
What is risk?
Risk is the likelihood of something - usually unpleasant - happening.
What is the difference between issues management and risk management?
The risk and issue management processes are complementary, with the issue management process informing the risk process. The issues management process is focused on dealing with external perceptions, reactions and impact on reputation. The risk process assigns a financial value to a particular risk occurring.
What is a crisis?
A crisis is a sudden, unexpected incident that may put employees, the public and/or the environment at immediate risk, and requires rapid and responsible action in the face of external scrutiny. Crises can happen without warning - for example, an accident, fire or explosion. In some cases though, crises can occur when issues escalate to a point when they themselves become the crises. Crises can therefore said to be either "event" driven, i.e. arising from a specific incident or incidents or "issue" driven - arising from the sudden escalation of an issue.
What is the difference between issue management and crisis management?
Issues management is proactive in that it tries to identify the potential for change and influence decisions relating to that change before it has a negative effect on a company. Crisis management tends to be a more reactive discipline dealing with a situation after it becomes public knowledge and affects a company.
Oman Economic Review 2007
