Strategic Community Relations Essay

Community relation is as much a crucial strategy for most of the business today. Community relations would be considered as "a food for the soul of the organization" as most of the American companies consider it one of the most serious strategic aspects of the business. Generally, a company and the community would want a mutual benefit from one another and so the reason for having an active relationship. In its part, the company would get into relations with the community to get the workforce and understand the local demand to ensure the provision of the demanded products and services. Therefore, the company should make a commitment to the community as part of its fundamental strategy, to not only help in attracting and retaining top employees but also position itself positively among the customers, in the process improving its competitive position in the market (Googins, 2018). Clearly, this is one of the strategies that would help the business survive. On their part, the community would be making a commitment to the company to get business by providing job opportunities to its people and providing higher qualities and at lower prices, goods, and services.

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Globally, companies employ community investment efforts to promote development and also benefit the community in their areas of operations as the local stakeholders. If properly implemented, community investment would help the company generate an environment favorable to private investment while at the same time contributing toward long-term improvements in the quality of life for the local communities. To accomplish this, the company would strategically involve in contributions and actions aimed at helping the local communities address their development priorities while taking advantage of opportunities created by private investment, in ways that are sustainable and supportive of the company's objectives. As Googins Bradley (2018) notes, positive, proactive connections to the community do translate into a boost to the bottom line. In order to be successful in the global economy, the company needs to be beyond just an ideal shareholder. It needs to embrace a broad array of new stakeholders requiring an innovative standpoint on corporate governance and behavior. Consequently, on top of being the investment of choice, the company must become the employer of choice, the supplier of choice, and the "neighbor of choice" (IFC, 2010).

Typically, economic downturns are usually caused by a reduction in charitable giving, and at times, corporate giving becomes slower to re-materialize compared to individual giving. However, as a research by Kate Hogarth, Marion Hutchison, and Wendy Scaife (2016) reveals, strategical thinking and giving can mutually benefit the community and the company. Corporate philanthropy would place the company at a better place competitively, considering factors such as attracting employees, customers, and strategic partners, thus benefiting the shareholders, despite the cost. The authors reveal that for every cent the company spends philanthropically, its share prices actually decrease. However, if the company simultaneously manages its reputation, then its market value is likely to increase.

As a company, managing the corporate reputation would call for making donations in form of money or resources but for a worthy cause. As philanthropy raises the company's reputation, it is likely to realize an increase in customer engagement and employee recruitment and retention and reduction in public and regulatory scrutiny. However, for the benefit to be realized, the reputation has to be actively fostered and maintained, both internally and externally. It is important to manage the company's reputation due to the increase in public awareness on corporate activities, which has since increased the demand for transparency, media scrutiny, and the rise of interest groups. Considering all these factors, it is indisputable that corporate philanthropy stands to be a win-win for both the community and the company if done appropriately. While the company benefits from greater stakeholder appreciation, the community benefits from the resources and engagement (Kane et al., 2009). The shareholders would then realize an increase in market value over time.

Also, having active community relations would require that the company builds collaborative partnerships. Building successful partnerships need commitments from all aspects of the company business. Partners prefer aligning with vendors who are committed to having collaborative, profitable, and long-term relationships. Such relationships can also be built with the surrounding community, which is indeed one of the major stakeholders for any company. When building such partnerships, the company must ensure its commitment to cultivating and nurturing as it evolves the business to meet customers' needs around cloud, managed services, and other business models. (Stanton, 2006) The company can decide to form a collaborative partnership with the community through institutions such as schools, hospitals, or even other companies within the same locality. Though there is no formula specifically for how much time and energy to initially allocate for building relationships or planning strategies, experienced partnerships agree on one fact that both activities are essential for long-term success.

Conclusion

All the factors considered, it is indeed indisputable that having an active positive relationship with the community is essential for the company to keep its desired reputation. Various works of research show that many companies have benefitted a great deal from their active community relations which have since protected their desired reputation. For example, the famous Merck & Company survived incurring huge costs after it allegedly leaked phosphorous trichloride from the Albany plant, resulting in the production of a clearly visible toxic cloud. Its positive relationship with the community saw the local residents produce an unexpected response: indifference. The company had to thank its being a good neighbor to the residents for the survival. Therefore, community investment is in itself an effective strategy that the company must consider, for long-term success.

References

Breger Stanton, D. (2006). Building Collaborative Partnerships. Journal Of Hand Therapy, 19(1), 50-54. doi: 10.1197/j.jht.2005.11.010

Googins, B. (2018). Why Community Relations is a Strategic Imperative. Retrieved from https://www.strategy-business.com/article/17964?gko=3673b

Hogarth, K., Hutchinson, M., & Scaife, W. (2016). The why and how of successful corporate giving. Retrieved from http://theconversation.com/the-why-and-how-of-successful-corporate-giving-69359

International Finance Corporation. (2010). Strategic Community Investment. A Quick Guide Highlights From IFC'S Good Practice Handbook.

Kane, G., Fichman, R., Gallaugher, J., & Glaser, J. (2009). Community Relations 2.0. Retrieved from https://hbr.org/2009/11/community-relations-20