Matthias Karmasin
Sandra Diehl
Isabell Koinig Editors
Media and
Change
Management
Creating a Path for New Content
Formats, Business Models, Consumer
Roles, and Business Responsibility
Media and Change Management
Matthias Karmasin • Sandra Diehl • Isabell Koinig
Editors
Media and Change
Management
Creating a Path for New Content Formats,
Business Models, Consumer Roles, and
Business Responsibility
Editors
Matthias Karmasin
Institute for Comparative Media and
Communication Studies (CMC)
University of Klagenfurt
Klagenfurt am Wörthersee, Austria
Sandra Diehl
Department of Media and Communications
University of Klagenfurt
Klagenfurt am Wörthersee, Austria
Isabell Koinig
Department of Media and
Communications
University of Klagenfurt
Klagenfurt am Wörthersee, Austria
ISBN 978-3-030-86680-8
ISBN 978-3-030-86679-2
https://doi.org/10.1007/978-3-030-86680-8
(eBook)
© Springer Nature Switzerland AG 2022
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Contents
1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Isabell Koinig, Sandra Diehl, and Matthias Karmasin
2
Cross-Border Media Management in a Digital Environment:
Challenges and Lessons Learned for Change Management . . . . . . .
Denise Voci and Matthias Karmasin
13
Strange Bedfellows? Business Modelling, Convergence and
Change Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Veronika Gustafsson and Erich J. Schwarz
33
3
1
4
The Effects of Big Data on Media Management . . . . . . . . . . . . . . .
Gregory A. Green and Edward C. Malthouse
55
5
Controlling and Change Management . . . . . . . . . . . . . . . . . . . . . . .
Gernot Moedritscher and Friederike Wall
73
6
Change Management in Human Resources . . . . . . . . . . . . . . . . . . .
Volker Stein
87
7
Work in Transition: Digital Media and Its Transformative
Potential for Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Caroline Roth-Ebner
8
New Technologies and Organizational Health: How Changing
Requirements of the Digital Workplace Compel Employers
to Think About Workplace Health Promotion . . . . . . . . . . . . . . . . . 125
Isabell Koinig and Sandra Diehl
9
Managing Brands in an Ever-Changing Media Environment . . . . . 143
Tobias Langner and Tobias Klinke
v
vi
Contents
10
Brand Worlds: A Guide to Creating Holistic Worlds of Brand
Experiences Through Communication . . . . . . . . . . . . . . . . . . . . . . 169
Sandra Diehl and Ralf Terlutter
11
Cross-Media Advertising in Times of Changing Media
Environments and Media Consumption Patterns . . . . . . . . . . . . . . 189
Sandra Diehl, Isabell Koinig, and Rebecca Scheiber
12
The Relevance of Social Media and Corporate Influencers as
Potential Change Agents in Corporate Communications . . . . . . . . . 211
Julia Durau
13
Convergence, Consumer Behavior, and Change Management . . . . . 231
Ralf Terlutter and Katharina Ninaus
14
Right to Privacy: A (re-)measurement . . . . . . . . . . . . . . . . . . . . . . . 249
Doris Hattenberger and Florian Vidreis
15
Managing Change Related to Consumer Privacy Laws: Targeting
and Personal Data Use in a More Regulated Environment . . . . . . . 267
Sophia Mueller, Charles R. Taylor, and Barbara Mueller
16
Sensemaking as a Change Agent Toward CSR Strategy
in the Media . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 289
Anke Trommershausen
17
CSR as “Integrity Management” in the Media Industry:
An Investigation of the Top Three Media Organisations from
Germany, Austria and Switzerland . . . . . . . . . . . . . . . . . . . . . . . . . 311
Isabell Koinig, Anika Bausch, and Matthias Karmasin
18
The Normative Turn in the Organisation of Media: Ethical
Considerations for Change Management in Media Enterprises . . . . 331
Michael Litschka and Larissa Krainer
19
Uncharted Territory: Datafication as a Challenge for Journalism
Ethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 343
Colin Porlezza and Tobias Eberwein
20
Harnessing Change in a Disruptive Environment:
Case Studies in Media Management and Innovation . . . . . . . . . . . . 363
Jose Alberto García-Avilés
21
Change Management and New Organizational Forms of Content
Creation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381
Christopher Buschow and Maike Suhr
22
Digital News Distribution and Intermediaries . . . . . . . . . . . . . . . . . 399
Barbara Brandstetter, Jan Krone, and Juliane A. Lischka
Contents
vii
23
Algorithms on the Internet: Factor of Media Change
and Challenge for Change Management . . . . . . . . . . . . . . . . . . . . . 419
Florian Saurwein
24
The Role of Human–Computer Interaction (HCI) in Change
Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
Gerhard Leitner
25
Everybody Is Going to Twitch: Game Streaming and Its Impact
on Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 467
Mathias Lux
26
5G Mobile Targeting Ads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 479
Shintaro Okazaki and Yue Peng
27
Conclusion: The Need for an Agile Organization as Triggered
by the COVID-19 Pandemic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491
Isabell Koinig, Sandra Diehl, and Matthias Karmasin
Chapter 1
Introduction
Isabell Koinig, Sandra Diehl, and Matthias Karmasin
1.1
On the Relevance of Change Management
Change management is conditioned by altered environmental and social conditions,
among them global, political, and technological changes (Moran & Brightman,
2001). One key term used in this context is convergence, which describes “the
merging of formerly distinct functions, markets and fields of application, further
changing the way companies operate as well as how consumers perceive and process
(media) content” (Diehl & Karmasin, 2013, p. 1). Convergence has always been and
continues to be one formula to conceptualize change. In recent years, however, other
tendencies have had an impact on the media industry and have shaped the industry in
such a way that it—given its relevance to society—has become the prototypical
example for change. The following trends have forced the media industry in
particular, but also other industries to change their modus operandi lastingly: the
rise of social media, a refinancing crisis, the misinformation pandemic, changing
landscapes of media usage and communication, the rise of produsage and
influencers, and challenges to legacy media (in the form of intermediaries) are just
some examples that need to receive consideration in this context. These examples
suggest that change is very closely related to convergence, but not exclusively
conditioned by convergence. For this reason, we propose to regard change as a
viable construct that should be considered by organizations in and outside of the
media industry, as well as their ability to proactively address and manage change:
I. Koinig (*) · S. Diehl
University of Klagenfurt, Klagenfurt, Austria
e-mail: isabelle.koinig@aau.at; sandra.diehl@aau.at
M. Karmasin
University of Klagenfurt, Klagenfurt, Austria
Austrian Academy of Sciences, Vienna, Austria
e-mail: matthias.karmasin@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_1
1
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I. Koinig et al.
“[C]hange and change management [have] to become the key paradigms of modern
society and its organizations” (Dievernich, 2015, p. 11). According to Moran and
Brightman (2001, p. 111), change management is best conceptualized as:
the process of continually renewing an organization's direction, structure, and capabilities to
serve the ever-changing needs of external and internal customers. Mastering strategies for
managing change is more important today since the rate of change is greater than at any time
in history. The marketplace is changing overnight. Organizational alliances and structures
are shifting rapidly. Everything in the organization is open to scrutiny.
When reviewing additional literature for definitions of change and change management, respectively, the necessity to take up change is repeatedly emphasized,
forcing companies to align their business practices to the changing (digital) environments. “It is important to note that this process must always start internally—in
the minds and hearts of managers and employees first, then in the structures and
processes” (Kreutzer et al., 2018, p. 200).
In terms of objectives, change management requires companies to adapt their
“corporate objectives, structures and strategies to meet the requirements of these
changing conditions. The change management, however, can also include the vision,
the business model itself and the products and services offered” (Kreutzer et al.,
2018, p. 2000). As such, the realization of change and transition—in relation to
structural, technological, strategic, or behavioral changes—impacts both business
and economic decisions (Wipfler & Vorbach, 2015).
Ongoing and far-reaching developments of convergence that are often dynamic
and complex, and outcomes of which are hard to anticipate in advance, force
organizations to address change proactively (Felipe et al., 2016). Hence, being
prepared for changes and adapting to changing (environmental) conditions can
help organizations to secure their place in an ever-more competitive business
environment (Sambamurthy et al., 2003; Nijssen & Paauwe, 2012). Most of these
changes are brought about by altered organizational environments and concern a
variety of areas, including markets, properties and rights, infrastructures, and consumer preferences, as well as changes in general social values (VandangeonDerumez et al., 2019).
As companies are confronted with crises of varying kinds (e.g., of an environmental, economic, or social nature), all while dealing with shorter innovation cycles,
the management of change in related processes becomes imperative. Given the
unpredictability of certain events, change itself is often associated with uncertainty,
ambiguity, and improvisation (Sharifi & Claxton, 2015). Against this background,
companies and practitioners alike are required to develop strategies to deal with
changing business environments.
1.2
Defining Change Management
In general, change management is forward-looking and future-oriented; as such, it
builds upon innovativeness and vision, in which individuals can act as change agents
(Diehl et al., 2013). “The empowered change management agents need plans that
provide a total systems approach, are realistic, and are future oriented. Change
1
Introduction
3
management encompasses the effective strategies and programs to enable those
change agents to achieve the new vision” (Lorenzi & Riley, 2000, p. 118).
As indicated above, change is a very complex matter that has received a significant amount of academic attention. Given its relevance to numerous areas, we
consider it essential to provide our definition of change management. From our
point of view, change management:
– is, in parts, conditioned by convergence
– increases in relevance because of complex and dynamic environmental developments (e.g., globalization, datafication, social media)
– is dynamic and ongoing (because of disruptive tendencies)
– has to be addressed proactively by the company
– requires organizational commitment (and communication) and a readiness to
change
– can help organizations to remain agile and competitive
– concerns all areas of the company (such as business models, strategic planning,
operational implementation, organization, communication, corporate values and
controlling, etc.)
1.3
Media and Change Management
For the purpose of our handbook, we will discuss the concept of media management
from two different angles. While traditional notions of the field are based on an
economic orientation, describing media management as the “business administration
discipline that identifies and describes strategic and operational phenomena and
problems in the leadership of media enterprises” (Wirtz, 2011, p. 5; see also Küng,
2007), we take a more contemporary and broader stance toward media management.
Following the argumentation presented by Scholz (2006), Hilmer (2009), and
Karmasin and Winter (2002), we perceive media management to also be concerned
with the conscious and strategically planned management of media itself (Scholz,
2006). The first perspective on media management looks at the strategic and
operational processes of media companies. The second perspective includes the
management of different media, addressing, for example, branding, advertising,
and consumer behavior, granting companies from different industrial backgrounds
access to the public.
The handbook, which sets out to address the issue of change in the media and
related industries, focuses on “permanent change management” (Albach et al., 2015)
in a number of areas. Topics and challenges addressed as part of this book build upon
current trends that affect companies working in the media industry and beyond.
These trends include changing business models brought about by the digitalization
of content together with disruptive innovations, more fragmented media consumption patterns, increased datafication and digitalization, new forms of content
4
I. Koinig et al.
provision, data privacy and privacy management, as well as the company’s “new
responsibilities” (e.g., sustainability, workplace issues, etc.).
The main purpose of this reader is to provide some insights into the most common
and crucial phenomena of media and change management while also revealing some
more specific issues brought about by innovations of all kinds (e.g., technical or
technological). The book is meant to be a useful reference guide for researchers,
students, and practitioners alike, as they are all affected by change processes. The
necessity to account for change has been even more apparent recently, with COVID19 forcing companies to adapt to changing modes of operations in the blink of
an eye.
Our approach to change follows a strong interdisciplinary reasoning and gathers
insights from renowned academic researchers, who are experts in their respective
fields. We perceive change to be a phenomenon which is relevant to a wide range of
industries, including the media industry, consumer goods industry, retail, and gaming among others. The textbook will address both perspectives on media management in the different subsections.
The textbook is subdivided into different sections, each addressing different yet
no less important aspects of change management in the media and related industries.
Since the approaches to change are multifold and cover both perspectives on media
management, contributions are grouped accordingly and discuss the central issue of
change management from a variety of angles, such as:
1.
2.
3.
4.
5.
6.
7.
8.
Change and Strategic Management
Organizational Change Management
Changing Branding and Advertising Practices
Changing Consumer Behavior and Consumer Privacy
Ethical/Social Responsibility and Change Management
Changes in Content Production and Management
Technology-Induced Change Management
The Need for an Agile Organization as Triggered by the COVID-19 Pandemic
1.4
1.4.1
Chapter Overview
Change and Strategic Management
The reader’s first section is concerned with strategic (change) management, touching
upon the areas of long-term mission achievement in general, as well as cross-border
management, strategy development, and controlling in particular.
Denise Voci and Matthias Karmasin shed some light on how digitalization has
affected cross-border media management. While the media industry has always been
affected by structural changes, the increasing relevance of new technologies and
digitalization requires media markets to transform at their core. The authors propose
change management processes to be implemented on three levels: the market level,
1
Introduction
5
the company level, and the structural level. By touching upon these levels, media
companies can become active co-creators of change.
Veronika Gustafsson and Erich Schwarz attend to the topic of how business
model innovation is affected by trends of change. The authors establish the relevance
of technological and ecological change for achieving lasting success while also not
neglecting the role of convergence to business model innovation. The authors
conclude by advising business executives to bear in mind the fit between different
types of convergence and business models during change processes.
Gregory Green and Edward C. Malthouse take up the topic of big data for media
management. Specifically, their chapter deals with how the affordances of new
technologies allow for the creation of big data sets, which present enormous
management challenges for media organizations. They discuss the data and analytical factors that drive these changes and attempt to anticipate how these factors will
affect media industries in the long run. To this end, the authors present a framework
that includes the major driving forces of such, including people, processes, data and
technology, and incentives.
Gernot Mödritscher and Friederike Wall discuss how controlling is influenced by
change management, paying tribute to how changing organizational conditions have
led to a redefinition of the responsibilities of controlling. By perceiving controlling
as a “business partner” to executives, the authors refer to a number of tools,
illustrating how controlling can aid the organizational management in implementing
strategic, organizational changes. Controlling competencies, thereby, build on business knowledge, communication, and critical reflection.
1.4.2
Organizational Change Management
Change management is also innate to organizations, which have to adapt their
organizational structures to changing environmental conditions and stakeholder
interests. Against the background of the agile organization and conditioned by trends
of convergence, datafication, digitalization, and globalization, companies have to be
prepared to address change in the workplace proactively and at a faster pace. As
individual values and preferences are changing, organizations also have to rethink
their organizational and HR operations at the core.
Volker Stein approaches the topic of change from a Human Resources
(HR) perspective by looking at the institutional context in which change management is located. Besides discussing the relation between change management and
HR, he offers arguments for why change management should be aligned with
HR. The discussion also takes recent business developments (e.g., movements
toward new work or automated HR) into account.
The focus of Caroline Roth-Ebner’s chapter, titled Work in Transition, is on
changes in office, respectively, knowledge work and their implications for an
organization’s change management. The author presents findings from a quantitative
study, which suggests that through virtual applications, work is becoming more
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I. Koinig et al.
flexible and mobile; moreover, global communication and collaboration are enabled.
As a result, a “new reality of work” is emerging.
In their contribution, Isabell Koinig and Sandra Diehl look at the concept of
organizational health, which has become a purgative over the last decade. Conditioned by the drawbacks of new technologies for individuals’ working lives, this
chapter presents Workplace Health Promotion (WPHP) as a viable area of change
management. This reasoning builds on the assumption that only healthy organizations are able to operate effectively, grow sustainably, and adapt smoothly to change.
1.4.3
Changing Branding and Advertising Practices
The third section is composed of articles investigating how the fields of branding,
strategic communication, marketing and advertising are impacted by trends of
change, which are subject to drastic alterations against the background of new
technological advancements, the emergence of new communication platforms, and
changing user behaviors.
In their contribution, Tobias Langner and Tobias Klinke discuss the challenges of
managing brands in a dynamic environment that is characterized by constant change.
As the media (and advertising) clutter increases and consumer profiles and consumption patterns diversify, companies are forced to design their messages in an
especially appealing way to reach consumers. The authors propose selected strategies that can assist companies in building strong brands, such as attention and
persuasion tactics and emotional approaches.
Sandra Diehl and Ralf Terlutter introduce the concept of brand worlds to create a
more holistic brand experience for consumers. Conditioned by their ability to not
only trigger pleasant feelings but also specific experiences in consumers, brand
worlds are regarded as combining real and media experiences, resulting in a more
encompassing consumer encounter. The authors stress that companies have to invest
in an expansive communicative and multi-sensual implementation in order to create
favorable consumer responses.
Sandra Diehl, Isabell Koinig, and Rebecca Scheiber shed some light on the
execution of cross-media advertising in the context of the multitasking consumer.
The increasing choice of media available and consumers’ tendencies to switch
between channels and offerings challenges marketing executives to utilize multiple
media in their marketing efforts. The authors review existing literature to the end of
presenting recommendations for advertisers on how to reach end consumers in the
changing present-day media landscape.
Julia Durau’s contribution discusses the concept of influencer marketing in
detail. Distinguishing between social media and corporate influencers, she paints a
picture of influencers as powerful role models, who can effectively communicate
change processes to their followers because of their perceived trustworthiness and
attractiveness, thus revolutionizing existing notions of brand communication. The
1
Introduction
7
author concludes her chapter with a reflection on why influencers in particular can
function as “change agents in corporate communications.”
1.4.4
Changing Consumer Behavior and Consumer Privacy
Changes in consumer behavior are elaborated in more detail in the fourth section.
Consumers migrating to online platforms challenge not only digital marketers but
also bear some legal implications. While there are a number of merits to digital
offerings, including personalization and localization of content, the pitfalls must not
be neglected, among them threats toward individual privacy.
Consumer behavior and change are highly dependent upon each other and are
debated by Ralf Terlutter and Katharina Ninaus. The authors address how continuous processes of convergence have led to drastic changes in consumers’ immediate
environments, which are increasingly based on technology and driven by lifestyle
decisions. The authors attribute these changes to the omnipresence of mobile
devices, which they regard as “key drivers of change.” Other trends concern the
Internet of Things and the customer technology industry.
In Doris Hattenberger and Florian Vidreis’ chapter, the right to privacy is put to
the fore. The authors observe that privacy is placed at risk in present-day media
environments and ask the question whether privacy protection has become obsolete.
The chapter concludes with the claim that privacy protection has to be constantly
adapted to changing communication environments.
In a similar vein, Sophia Mueller, Charles Ray Taylor, and Barbara Mueller
examine how the increasing Internet usage among consumers—encompassing social
media and e-commerce—has had far-reaching implications for their privacy. While
personalization of products and media offerings is enabled, the personal data trails of
online activities are not without pitfalls, as demonstrated by a number of high-profile
data privacy breaches. Against the background of diminishing consumer trust,
governments need to step up and find proper ways of managing data in an everchanging communication environment.
1.4.5
Ethical/Social Responsibility and Change Management
The fifth section investigates companies’ social responsibility within a changing
media environment. Especially the organizational changes related to the implementation of CSR and ethical approaches to (media) management and accountability,
respectively, are discussed in this section.
In Anke Trommershausen’s contribution, sensemaking is discussed as a central
concept for managing change in the media. In an environment that is characterized
by volatility, uncertainty, complexity, and ambiguity, the author calls for an
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I. Koinig et al.
examination of CSR and CSR-related activities in terms of the organizational
changes required to implement CSR lastingly within the media.
A similar topic is taken up by Isabell Koinig, Anika Bausch, and Matthias
Karmasin, who investigate not only whether CSR presents a topic of relevance for
media organizations operating in Austria, Germany, and Switzerland but also take it
one step further: they perceive CSR as “integrity management.” Thereby, they mean
that combining social expectations with economic reasoning has become the norm in
the media industry. The authors’ analysis, however, suggests that CSR is not yet
implemented as “integrity management” in the media sector, and they provide
potential explanations for this lack of integration.
Drawing from philosophy, Michael Litschka and Larissa Krainer discuss how
the social embeddedness of media enterprises leads to a normative turn. By this, the
authors refer to ethical approaches to management, including considerations regarding the organization’s moral obligations, communicative rationality, and integrative
business ethics among others. Perceiving these normative considerations as a process becomes key in a mediatized business environment.
The datafication of journalism and the arising ethical challenges of such
datafication are discussed by Colin Porlezza and Tobias Eberwein. An empirical
study conducted by the authors is based on statements from media practitioners,
whose input—together with an extensive document analysis of ethical codes—
highlights that journalists are required to deal with a multitude of ethics nowadays.
Particularly, datafication and algorithm-driven news work are challenges that warrant additional monitoring and research.
1.4.6
Changes in Content Production and Management
With traditional content losing its dominance over digital content, even more so over
the past decade, and selected audience segments literally migrating online, media
managers are challenged to keep up with these trends. As such, the journalistic
profession is undergoing some drastic changes, with have an impact on content
procurement, allocation, distribution, and journalism ethics.
Jose Garcia-Aviles paints the current mediated environment as one that is “disruptive.” By use of multiple case studies, the author examines how news companies
implement change. He advises media companies to invest in product leadership,
organizational competence development, and user satisfaction in order to stay ahead
of the competition.
Christopher Buschow and Maike Suhr dedicate their contribution to the new
organizational forms of content creation. Their argumentation builds on the fact that
it is no longer sufficient to focus on traditional content producers, but also include
firms that might not traditionally be considered media companies. These organizations, which are characterized by projectification, peer production, and
platformization, have to adapt their modes of production, yet not all opportunities
are without risk.
1
Introduction
9
Jan Krone, Barbara Brandstetter, and Juliane Lischka look at how news publishers in German-speaking countries approach the digitalization of news content as
well as the transition from analogue to digital distribution. The authors introduce
new intermediaries, such as online kiosks or social media platforms, as potential
remedies to soften the transition for media organizations.
In his contribution, Florian Saurwein elaborates on how algorithms have had an
impact on multiple industries, where they have started to alter market structures,
business models, and revenue streams. These data-driven, automated services are
used in a variety of contexts, including content production, distribution, moderation,
and advertising. He concludes the chapter by pointing out that algorithms are not
merely factors for media change but also challenges for media change.
1.4.7
Technology-Induced Change Management
Change and its relation to technical, technological, and industry-specific developments are treated thoroughly in the reader’s seventh section. In recent years,
technology has affected a number of areas: advanced technological infrastructures
allow for a faster delivery and more personalized content; streaming services are
competing with traditional broadcasters for viewer attention, and individual interactions with media content have to be optimized.
Gerhard Leitner’s contribution discusses the role of Human Computer Interaction (HCI) in change management processes, which are brought about by the
continuous advancement of new technologies. The author focuses on three core
concepts in his elaboration, namely, Usability Engineering, User Experience, and
User-Centered Design, which result in new and improved user experiences.
The chapter authored by Matthias Lux deals with how game streaming (i.e., the
broadcasting of gameplay over the Internet) has changed gamer experiences. By
example of Twitch, he illustrates how traditional gaming in the form of video
streams is now complemented by interactivity, advanced streaming, and individual
content production. The author concludes with recommendations for further research
on gaming.
Yue Peng and Shintaro Okazaki dedicate their article to a specialized topic,
namely, 5G. This new generation of mobile broadband is of benefit to both marketers
and advertisers due to its ubiquitous presence, allowing them to create more personalized and targeted ads. This is particularly enabled by 5G’s main characteristics,
namely, ubiquity, granularity, and adaptivity. According to the authors, the concept
is said to have a promising future and is expected to change the advertising industry
and landscape lastingly.
10
1.4.8
I. Koinig et al.
The Need for an Agile Organization as Triggered by
the COVID-19 Pandemic
In the book’s final chapter, the future outlook, Isabell Koinig, Sandra Diehl, and
Matthias Karmasin address how changing environmental conditions require organizations to be flexible, lean, and responsive to faster and more disruptive developments. By example of the media industry, with the implications of COVID-19, a
far-reaching and unpredictable event that turned business operations upside down,
challenges associated with work practices in and outside of the media industry will
be used to underline the relevance of change for organizational agility and success.
We, the editors, wish to thank all authors for their willingness to contribute to this
textbook, especially in challenging times like these. We also want to express our
gratitude to the reviewers for their detailed feedback that helped to improve the
overall quality of the contributions and Karen Meehan for her thorough proofreading. We would also like to thank the Faculty of Humanities for its financial support.
It is our hope that academics, students, and practitioners alike find the book both
enjoyable and stimulating. If the material presented in this textbook generates new
insights, constructive debates, and subsequent investigations, we have accomplished
our goal.
References
Albach, H., Meffert, H., Pinkwart, A., & Reichwald, R. (2015). Management of Permanent
Change–New challenges and opportunities for change management. In H. Albach, H. Meffert,
A. Pinkwart, & R. Reichwald (Eds.), Management of permanent change (pp. 3–21). Gabler.
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M. Karmasin (Eds.), Media and convergence management (pp. 300–323). Springer.
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Sharifi, S., & Claxton, J. (2015). Challenging notions of “change” and “change management”. In
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Wipfler, H., & Vorbach, S. (2015). Agile Management for Organizational Change and Development. In F. E. P. Dievernich, K. O. Tokarski, & J. Gong (Eds.), Change management and the
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Isabell Koinig is a Postdoctoral Researcher at the Department of
Media and Communications at the University of Klagenfurt, Austria. Her research interests predominantly concern the fields of
health communication (pharmaceutical advertising, eHealth/
mHealth, health for sustainable development, and wearables),
intercultural advertising, organizational health, as well as media
and convergence management. For further information, please see
https://www.aau.at/en/media-and-communications/team/postdocass-mmag-dr-isabell-koinig-bakk-phil/
Sandra Diehl (PhD, Saarland University, Germany) is Associate
Professor and Head of the Department of Media and Communications at the University of Klagenfurt, Austria. Her research
interests include CSR and health communication, international
and intercultural advertising, as well as media and convergence
management. For further information, please see https://www.aau.
at/en/media-and-communications/team/assoc-prof-dr-sandradiehl/
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I. Koinig et al.
Matthias Karmasin is Director of the Institute for Comparative
Media and Communication Studies of the Austrian Academy of
Sciences and the University of Klagenfurt, where he is full professor for media and communications sciences. His research areas
concern organisational communication, media ethics and media
management, political communication, communication theory,
media practice and media accountability. For further information,
please
see
https://www.oeaw.ac.at/cmc/the-institute/staff/
matthias-karmasin/
Chapter 2
Cross-Border Media Management
in a Digital Environment: Challenges
and Lessons Learned for Change
Management
Denise Voci and Matthias Karmasin
Abstract The media industry is and has always been characterised by structural
changes to such an extent that change has become the only constant in the media
environment. Although there are few studies dealing with change management in the
media industry, the transformative nature of media markets in relation to the
digitisation processes has been under-researched, especially by transnational media
management, so far. In this chapter we therefore investigate the impact of
the digitisation process on three different levels: namely, on the media market, the
media company and on the strategy level. This way, we are able to show on the one
side lessons learned and (future) challenges for change management in the media
industry, as well as on the other side how media markets and companies are not only
subjected to these changes but are also their active (co-)creators, in the sense of a
recursive relationship.
2.1
Introduction
The media industry is and has always been characterised by structural changes. In a
constantly changing regulatory, technical and economic environment, “change has
become almost the only constant in the organisational environment of media companies” (Mierzejewska, 2011, p. 22). Basically, these changes are due to the
industry’s fast-paced character that is constantly adopting changes taking place in
other (related) social systems such as policy and economy. Deregulation of the
D. Voci (*)
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: denise.voci@aau.at
M. Karmasin
University of Klagenfurt, Klagenfurt, Austria
Austrian Academy of Sciences, Vienna, Austria
e-mail: matthias.karmasin@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_2
13
14
D. Voci and M. Karmasin
markets, the rise of radical capitalism and the resulting market saturation are only a
few of the explanations named for these changes (see, e.g. Chan-Olmsted & Chang,
2003; Fuchs, 2017). Above all, a fundamental role is attributed to the processes of
globalisation and digitisation: Globalisation has diminished the boundaries between
markets, while the relevance of physical distribution has been reduced by
digitisation. Globalisation is considered as both sustained and booster of crossborder engagement. Indeed, especially in the last decade of the twentieth century,
media (companies) became progressively able to cross national borders and thus
support the globalisation process (Hjarvard, 2008, p. 130). On the other hand, with
the liberalisation of the market, the deregulation and interdependence of international trade relations, the globalisation process itself offered (media) companies the
opportunity to be active on a global market in the first place (Görg et al., 2005).
Rapid developments and innovations of especially media technology have always
accelerated and facilitated globalisation processes. From the invention of the printing
press to the development of the Internet, “new” media have always sped up communication. Territorial distance has increasingly declined in importance, thereby
favouring the development of a new cross-border networked society (Scholte, 2000,
p. 48; Beck 1997, p. 61ff.; Rosenberg, 2000, p. 24). For the first time in the 1960s,
thanks to the establishment of the first geostationary communication satellites, it was
possible to transmit messages directly and internationally using electromagnetic
waves. The perspective of reaching an international audience through new communication technologies has encouraged media companies to expand their reach
beyond their own national borders (Hjarvard, 2008; Giddens 2002, p. 11 f.).
Hence, media (companies) play a fundamental role in promoting the globalisation
process, since they enable the international flow of news and the exchange and
distribution of TV programmes, movies, music, etc. and thus facilitate information
and cultural exchange across countries (Matos, 2012, p. 1329).
Since the last decade of the twentieth century, the Internet and the digital
revolution have further strengthened this trend, as it is theoretically possible to
distribute and make digitised media products available around the world in nanoseconds by creating virtual marketplaces (Autio & Zander, 2016; Hagenhoff, 2016).
Actually, when media companies use digital technologies or engage on digital
platforms or work with and through digital infrastructures, they “automatically”
venture abroad (van Kranenburg et al., 2004, p. 102): “In principle, any media
company can serve any media market” (von Rimscha et al., 2019, p. 521). But:
@to the prospective to conquer new territories, markets and therefore audiences
through cross-border engagement, correspond as many new challenges of being
active on an international market, for both the media industry and media companies
as agents of this industry. The complex, manifold and changing framework
conditions that characterise the media environment anyway vary depending on the
cross-border markets media companies engage with. This increasing complexity
intensified by interdependency, globalisation and faster change patterns requires
viable solutions through change management, which enable companies to deal
with unpredictable events and the powerful dynamics of the given conditions of
the media world. Dealing with change is therefore not a choice but a necessity, in
order to survive and be successful (Czichos, 2015). Hence, in this chapter we outline
2
Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
15
which challenges that arise for change management at different levels of the media
industry based on the example of one of the biggest changes that the media world has
gone through recently: i.e. digitisation, and we share some lessons learned.
2.2
Changes Through Digitisation: Opportunities
and Challenges for Media
Media (companies), on the one hand, represent one of the sectors that have supported
digitisation and cross-border engagement through new communication and media
technologies. On the other hand, they also experience the largest impacts of these
processes in the sense of opportunities and challenges. For example, the conversion
from analogue to digital technologies has reduced production costs, especially in the
audio-visual sector. This results in lower investment costs and thus more liquidity. In
addition, media content is ideally suited to online distribution in digital form. Digital
(media) products or services do not have to be physically delivered and distributed,
and also in terms of logistics this merely means providing servers to make data
available online. Costs for engaging across borders are also minimised, since
(media) companies can use the same digital infrastructure to expand to other
markets. Market entry barriers are shrinking and “if we neglect national firewalls,
the reach of the Internet is global” (von Rimscha et al., 2019, p. 525). Digitisation
has thus created additional distribution channels, so that economies of scale can be
preserved and further expanded. Consequently, media companies can serve different
markets and target different audiences. This in turn means an increasing economic
feasibility of media content for smaller target groups: Niche audiences that aren’t
economically viable on a national level become attractive when addressed on a
global scale (Doyle, 2002; von Rimscha et al., 2019). Digitisation also means new
opportunities to monetise the audience. By collecting users’ (demoscopic) data on
different platforms, advertising can strike a new path: Ads can be placed in a contextand user-related manner, thus increasing their likelihood of success. All in all,
digitisation has changed the way content is created, distributed and monetised. So,
if we understand the aim of change management as to improve the organisation by
changing how work is done (Voehl & Harrington, 2016, p. 3), switching to or
integrating digital business through convergence processes can be seen as a successful change management strategy, since it stimulates external growth and seems
to be an economically attractive way to adapt to the structural changes in the media
industry, as well as to ensure continuity while allowing innovation.
However, such change management increases the pressure on (media) companies
that have to provide viable solutions in ever-shorter timescale without compromising
their quality (Voehl & Harrington, 2016, p. 3). This pressure is further exacerbated
by the increasing cross-border competition, triggered by new (digital) actors.
Although trends towards concentration and convergence have always been present
in the media sector, digitisation has further intensified this tendency. One of its
fundamental reasons is certainly the so-called refinancing crisis, which is
16
D. Voci and M. Karmasin
experienced in particular by journalistic media. Private-sector journalism is traditionally financed by a mixed model, i.e. through both advertising and revenues
coming from the audience market (Nienstedt & Lis, 2013). The Internet and
digitisation have destabilised both forms of revenue, as both advertising and readership (i.e. audience) have moved online. This in turn benefits primarily
non-journalistic offers such as search engines and social networks, which have
gained significant market shares on the online advertising market (Bosshart &
Hofstetter, 2017, p. 85). In 2019, around half of the total global advertising spending
was allocated online, with the duopoly Google-Facebook achieving around 61% of
the global market share of digital advertising (Enberg, 2019; Burrell, 2019). This is
because Google and Facebook use algorithms for their (customer) targeting using
saved (demoscopic) data, which both printed media and their online versions cannot
afford and/or generate. Furthermore, digitisation and the Internet have created a
so-called free-of-charge mentality on the audience side, i.e. the expectation or rather
claim of users that (journalistic) content has to be available free of charge. This is
because these new online players provide and distribute news and content free of
charge, whereby they haven’t paid for their production (Breunig, 2004 p. 295ff.;
Dou, 2004, p. 349).
Of course, these developments require answers from change management at
different levels, but in practice these are not always implemented in the sense of
improving the company’s quality. Indeed, media companies respond to declining
revenues with further concentration and convergence processes. This is particularly
true when considering the “vertical specialisation” processes that have led to global
vertically integrated companies and transnational production chains (Stark, 2011,
p. xvi). The answer of media giants seems to be to become even bigger, through
cross-border mergers, convergence and networks, in order to gain access to the entire
value chain (Weichert & Kramp 2009; Maniaty, 2013, p. 62). Indeed, big media
players of the so-called Old Economy responded to digitisation and its challenges by
acquiring digital companies (Trappel et al., 2002). The acquisition of AOL—at that
time the largest Internet service provider worldwide—by media giant Time Warner
back in 2001 serves as an example for this kind of reaction. Although the merger
failed and Time Warner undertook a spin-off from AOL in 2009, the trend towards
vertical and diagonal integration, i.e. concentration processes, as reaction to competitive pressure from new players of the digital world, is unlikely to decrease
(Jakobs, 2010). In the more recent past, for example, Disney took over large parts
of its competitor Fox, including, among others, the Hollywood studio 20th Century
Fox, several television stations and parts of the Hulu streaming platform while
launching its own streaming platform Disney + (Feldman, 2019). The Disney-Fox
merger, apart from having drastically advanced media concentration, can be
interpreted as the answer to the increasing pressure film producers and television
channels experience, since audiences moved to online streaming services like Netflix
and Amazon Prime Video, which invest billions in their own content. The change
management strategy of the big “old” players seems therefore to move towards
convergence, to work together in order to benefit from economies of scale, as well as
to develop their own strong (streaming) service to compete with the new players of
the digital era. Media companies thus have to deal with the “loss of audiences not
2
Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
17
highly interested in news, the diminishing effectiveness of the mass media business
model, the lingering effects of the economic crisis, and the impact of digital
competitors” (Picard, 2010, p. 1). They have to develop new competencies, adapt
existing services and products or develop new ones, explore new media markets and
engage in innovative—mostly cross-border—collaboration structures (Küng, 2017).
Within the meaning of a permanent applied and integrated change management,
media companies are forced to reinvent and diversify their business to survive in the
market, i.e. to cope with the dynamics of the media industry. Digitisation thus
enhances innovation both in terms of business models and content, as well as in
terms of technologies and processes (Maijanen & Virta, 2017). This involves
specific risks and therefore challenges for change management, even for larger,
established media companies, since investing in digital business is understood as
an uncertain bet on the future (Shao, 2015).
2.3
Media Companies as Mirrors and Shaper of Structural
Changes
Opportunities and challenges of a media industry that is constantly evolving due to
digitisation processes have already been recognised and discussed extensively in the
scientific research community, as addressed above. In this chapter, we want to take a
different perspective by focusing on media companies being not only mirrors of the
ongoing transformation processes the media industry is subjected to but also—with
their (cross-border) activities and tactical considerations—key actors that initiate
change, thus having significant influence on market structures. We refer here to
Giddens’ (1984) structuration theory and his concept of recursiveness between
agency and structure. “Structuration theory offers a conceptual scheme that allows
one to understand both how actors are at the same time creators of social systems and
yet created by them” (Giddens, 1991, p. 204).
With the concept of recursiveness, Giddens (1997, p. 52) indicates that (1) actors
produce and reproduce the structures of social systems through their actions and
(2) structures enable actions in the first place while they simultaneously (3) have to
be interpreted as both medium and results of actors’ agency: “[. . .] structure is both
medium and outcome of social practices. Structure enters simultaneously into the
constitution of the agent social practices, and ‘exists’ in the generating moments of
this constitution” (Giddens, 1976, p. 5). This means: when media companies act,
they orientate themselves towards specific structures of the media industry, which
either facilitate or restrict their actions. At the same time, media companies shape
and create the structure of the media industry themselves—only through their actions
(Voci, 2019, p. 55ff.). Thus, we want to examine both sides of this recursive
relationship and, by doing so, outline new challenges they are subjected to in the
framework of digitisation. For this purpose, we will first focus on media companies.
Afterwards, we will investigate changing framework conditions of the media industry and conclude by pointing out strategies media companies can develop and apply
18
D. Voci and M. Karmasin
when acting in their constantly changing environment while outlining challenges
and sharing lessons learned for change management in the media environment.
2.3.1
Media Companies in a Changing Digital Environment
With the advent of the digital era, it can be observed how digital companies
(e.g. Netflix, Apple, but also Google) increasingly invest and get involved in traditional media activities (Farber, 2017; Petski, 2017a, b; Lieberman, 2016). This, as
already mentioned above, generates not only changing consumption patterns (see
Diehl et al. and Terlutter; Ninaus in this volume) but also transforms the competitive
settings of the media industry, therefore changing the media market’s composition as
well as the nature of (traditional) media companies themselves (Voci et al., 2019,
p. 32; see Brandstetter et al. in this volume). Indeed, the digital revolution and the
increasing cross-border engagement expose traditional media companies to new
competition and force them to reinvent themselves, in order to remain competitive
(Voltmer, 2013, p. 160). Accordingly, change management faces the challenge here
to find an effective way to respond to digitisation as external force that creates an
explicit need for change (Passenheim, 2010, p. 7) while improving the organisation
and maintaining its quality (Voehl & Harrington, 2016, p. 3).
This is particularly problematic for public-service media, as they compete with
new commercial digital content providers which often pursue a diversification
strategy by offering both content for mass audiences and special content for public
niches. The common reaction of public-service media is to commercialise their
programme and offer entertainment-oriented content, i.e. to monetise their audience.
This means content is increasingly created to address mass audiences, so that it
appeals to advertisers (Born, 2003, p. 64). Public-service media are also progressively acting like companies of any other industry, following the principle of
economisation (Altmeppen, 2008, p. 86). This includes the risk that media are less
and less able to fulfil the socio-political function they have as cultural goods in
society, but rather act according to the commercial logic of the market economy
(Andres, 2004). Consequences are the so-called de-merit of media products and their
content, whereby marketability and profitability become their most important factors
(Kiefer & Steininger, 2014, p. 25), as well as political-democratic implications.
Indeed, if maximising profits, mass audience orientation and commercialisation
become the guideline of media companies, instead of enabling the public sphere,
serving as watchdog, representing social interests, fulfilling the education mandate
and informing and activating for political participation, then the prerequisites for a
functioning democracy would no longer exist. Accordingly, one of the main challenges of this time for change management in the media sector is the need to find
viable solutions in order to support the dual character of media as both economic and
cultural goods and its associated functions. On the one hand, alternative media
economic ways have to be developed to create innovative financing models as
well as a fairer competitive environment for media companies, so that the pressure
to maximise profits can be reduced and media companies can act in respect to their
2
Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
19
dual function again, i.e. changing without compromising their quality. On the other
hand, media policy measures have to be taken to create an environment that protects
the scope for action, especially of public (–service) media, so they can operate as
independent and democratic institutions (see also Voci, 2019, p. 22ff., 312ff.; see
Porlezza and Eberwein in this volume). This would require a fundamental
restructuring of both structures of media markets and media and press subsidies.
The latter calls for a strict distinction between media companies—who would benefit
from such subsidies—and so-called pseudo-media companies1 (Voci et al., 2019,
p. 46). This could be a way to render media companies less susceptible to those
external (economic, political) forces that impose organisational changes while
ensuring independent and critical media—i.e. (organisational) quality—by
counteracting both the problem of “native advertising”2 and the re-politicisation
processes of traditional media.
2.3.2
Changing Framework Conditions of Digitised Media
Markets
As already mentioned, the constant evolution of the media landscape—driven by
phenomena like digitisation, cross-border engagement and convergence—exposes
media companies to considerable structural changes, forcing media managers to
steadily readapt their approaches to new strategic environments (Küng, 2017;
Mierzejewska, 2011), in the sense of a constant, integrated change management,
which is needed not only for an effective realisation of change but also for an
understanding of the dynamics of change (Passenheim, 2010, p. 11).
The complexity of change management as a constant readaptation is significantly
increased when engaging across borders, since both success and failure of both
change management and such an engagement largely depend on the different
framework conditions that may occur in the host market (Hollifield, 2001). When
engaging across borders, (media) companies therefore have to scan and consider not
only their internal capabilities—such as financial stability and resources available
(see, e.g. Chan-Olmsted & Chang, 2003) which may enable change—but rather
identify and examine external forces that may affect their scope of action on the
international marketplace, i.e. forcing change. Such external factors are related to the
1
We refer here to the definition of media companies provided by Voci et al. (2019). Accordingly,
media companies are companies that are organised around the three core components of media
business, i.e. content sourcing, content aggregation and content dissemination. Content is understood as the principal task of media companies and refers to “producer-generated” content. Thus,
companies such as Facebook and Google, who only meet two of these three core activities, are
defined as “pseudo-media companies”.
2
The key problem with “native advertising” is that in this online advertising form, the borders
between editorial content and advertising are intentionally blurred, which is considered by some
media companies as a threat to journalism and by others as necessity for the survival of (journalistic)
media companies (Coddington, 2015, p. 77).
20
D. Voci and M. Karmasin
market, the policy and the culture of the host country (Cottle, 2003; Gershon, 2000)
and include different economic, technological, industrial, societal and political
characteristics (Andrews, 1971), as well as factors concerning management practice
and culture that shape strategy processes (Bartlett & Ghoshal, 1991).
Previous studies have already investigated and identified some of these external
framework conditions. The fact that political and regulatory factors of a host market
may influence media companies’ possibilities for action seems to be intuitively clear,
since a country’s media development is mostly driven by its political and regulatory
environment (Chan-Olmsted et al., 2008). Therefore, markets with, e.g. low levels of
governmental control or intervention, or with high security of intellectual property
rights are preferred for cross-border engagement (Rodriguez & Wilson, 2000; van
Kranenburg & Hogenbirk, 2005). Furthermore, media, being both economic and
cultural goods, are closely linked to the culture and the society of the country they
operate in. Consequently, demographic and educational factors, as well as language,
values and personal attitude, are framework conditions of a host country that may
significantly influence media companies’ activities (Gershon, 2000; Shrikhande,
2001; Kutschker & Schmidt, 2011). Market composition—i.e. number of (potential)
buyers and sellers—possible market entry barriers, market size, as well as the
communication infrastructure of a country have been identified as further factors
that affect a country’s attractiveness and adequacy for a media company’s crossborder engagement (Chan-Olmsted & Chang, 2003; Chan-Olmsted et al., 2008).
The role of the digital revolution related to such framework conditions has been
rather neglected, so far. Recent research3 has examined exactly such interplay,
showing how digitisation as external force imposing change plays a prominent
role on different levels. Let’s consider, e.g. technological framework conditions.
Media products are produced depending on the level of technological development
of the host market. Hence, European media companies produced and traded their
audio-visual media products in HD quality and in digital format for streaming
services of the Asian market long before these developments were an issue in their
domestic markets. It can thus be stated that the Asian market’s earlier digitisation
boosted the European digitisation process. The local Asian conditions caused a need
for European media companies to change their organisations’ processes and technologies, thereby causing a change in the European market as well. This in turn is an
expression of the different consumption patterns and consumer preferences that
occur in different markets. Accordingly, if a media company wants to continue to
serve certain markets, it inevitably has to orientate itself and adapt to local preferences changing former strategies. On the other hand, the status of the technological
infrastructure of a host market can also serve as constraint for cross-border business
transactions. Indeed, if the IT infrastructure of a host market isn’t sufficiently
developed, digital media content in HD quality cannot be developed properly.
Therefore, media companies handling large data volumes in order to distribute
3
We refer here to original results of the international research project The management and
economics of cross-border media communication—a study of the transnational relations between
market structures and media management. For further information, please visit www.cbmc.info.
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Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
21
their digital media content will likely change their cross-border strategy, avoiding
engaging in those countries where the existent infrastructure doesn’t support that
kind of business.
As already mentioned, digitisation as recent example of change in the media
sector is pressuring media companies in particular of the print industry, since they’re
required to transfer their business model online. However, this change management
procedure is not equally achievable in all countries, since it depends largely on the
market composition and in particular on the market position of the duopoly
Facebook and Google in that specific market. Actually, the transfer as change
management strategy seems to be impracticable in markets where the duopoly
occupies a strong market position (keyword: refinancing), due to the lack of economic resources. The more digital and data-driven the marketing business of media
companies becomes, the more important it is to be able to address and effectively
serve large target audiences. The logic of the digital economy has shown that larger
markets are needed in order to scale media products: i.e. the bigger the better. The
digital advertising market thus operates based on accesses; this means the more hits a
media product generates, the more attractive it is to advertisers, i.e. the more
economic resources there are to proceed with organisational and strategic changes.
This in turn leads especially for news media to the problem of click-baiting, where
suggestive and enticing headlines are used to persuade the audience to click on an
online content. This development can be interpreted as fallacious change management, since this strategy to deal with change affects and jeopardises the organisation’s quality.
Media companies that are active in such foreign markets where the digital giants
have massive market shares forcing them to change often respond in two different
ways: either they withdraw from those markets and invest their economic resources
in building up new, complementary and easy to digitise business areas; or they try to
transfer their existing business by cooperating with former local competitors. These
two strategies can be understood as successful change management, since they can
raise productivity by modifying and complementing existing organisational
structures.
Furthermore, in this new competitive situation media companies have a need for
distribution while Facebook and Google have a need for content. This way, the
relationship between media and pseudo-media companies can be defined as being
“frenemies”, since on the one hand the digital player can—or rather could—help
media companies distribute their media content via their almost unlimited digital
distribution network, but on the other hand they (mis-)use the content media
companies produce for their own economic advantage. Thus, they are both trapped
in a so-called prisoner’s dilemma,4 which can only be solved through the
4
The prisoner’s dilemma is an imaginary situation applied in game theory, where two individuals
acting in their own self-interest do not produce the optimal outcome, i.e. they don’t cooperate, even
if it appears to be in their best interests to do so (for further insight see Rapoport et al. (1965), as well
as Kuhn (1997)).
22
D. Voci and M. Karmasin
above-mentioned necessary restructuring of media markets and cooperation between
different players, i.e. successful change management.
Digitisation has thus changed the framework condition of cross-border engagement, by also changing its management practices and thus challenging change
management. Business deals are executed differently in the digital environment:
Before the digital revolution, media companies made few big and economically
relevant deals with their engagement across borders, while nowadays deals have
increased in quantity but are substantially fragmented and therefore much smaller in
economic terms. Preferred strategies and cross-border activities within this framework are addressed in the next section.
2.3.3
Media Companies’ Cross-Border Strategies
for the Changing Digital Environment
As explained above, according to structuration theory (Giddens, 1984, 1997), the
structure of (cross-border) media markets and the (cross-border) strategies of media
companies are recursively linked. This means markets consist of what media companies do, and media companies’ actions are based on the way markets operate and
are structured. After discussing media markets’ structures and their framework
conditions related to the changes caused by the digitisation process in the previous
section, we focus here on strategies media companies (can) apply when engaging
across borders in an increasingly changing digital environment, i.e. as part of their
change management.
Although the process of crossing borders is said to be “rarely well thought out in
advance, and it typically builds on a combination of rational analysis, opportunism,
and pure luck” (Bartlett & Beamish, 2014, p. 10), various behavioural patterns of
media companies acting across borders can be observed and identified. Indeed,
media companies have a large variety of strategic options they can choose form
when it comes to their cross-border engagement. These activities are both facilitated
and restricted by the structure of the market and the specificity of media products, as
argued above. Media management scholars and transnational media management
literature in particular offer valuable approaches to analyse and classify cross-border
activities and strategies of cross-border media companies (for an overview see,
e.g. Strube, 2010; as well as Werner, 2002), although most research primarily
focuses on cross-border activities of large media companies venturing abroad as
growth and expansion opportunities in their domestic markets are limited
(Birkinbine et al., 2017; Gershon & Suri, 2004; Sjurts & Strube, 2014). As a rule
of thumb, additional benefits should be higher than additional costs, so that crossborder engagement is viable. This in turn means media companies are constantly
striving to realise competitive advantages, by optimising and creating a differentiation potential and thus growing (Apfelthaler, 2002, p. 202). However, the cultural
character of media further complicates growth possibilities (Albarran, 2002). Simple
2
Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
23
Fig. 2.1 Cross-border
strategies (Bartlett &
Ghoshal 1989)
export strategies seem to be insufficient, since consumers generally prefer culturally
proximate and therefore domestic over foreign content (Trepte, 2008). Engaging
across borders thus means not only mobilising capital for investments in foreign
markets but primarily developing strategies to adapt to local conditions. Handling
products that have both cultural and economic characteristics—as media have—
implies the challenge to ensure scalability while managing foreign local differences.
Bartlett and Ghoshal (1989) have developed four strategies (media) companies can
apply when engaging cross border, based on exactly these two dimensions: global
standardisation and local adaptation (see Fig. 2.1). Companies seeking to exploit the
(economic) advantages of standardisation are referred to as international or global
companies, while companies attentive to local conditions are referred as multinational or transnational. Yet, there are some substantial differences between these
strategies that need to be clarified.
Following a global strategy implies a centralised business organisation and
producing one rather generic product which is distributed unmodified globally,
i.e. high levels of standardisation with no local adaptation characterise this strategy.
International companies instead refer to themselves as “domestic with some foreign
appendages” (Bartlett & Beamish, 2014, p. 13) and therefore have low levels of both
local adaptations and global standardisation. Accordingly, companies following an
international strategy are likely to export their domestic products to those markets
where they can be sold without (much) adaptation. In contrast, a multinational
strategy highlights the difference between domestic and foreign markets and adapts
to their specificity. This means that each market is served with locally adapted,
i.e. customised products, resulting in high levels of local adaptation, but low levels
24
D. Voci and M. Karmasin
of global standardisation. The fourth approach—the transnational strategy—is
based on the assumption that (media) companies operate in diverse economic,
regulatory and cultural context and is regarded as the most promising strategy for
media companies acting across borders (Chalaby, 2009, p. 225; Gershon, 2000,
p. 81 f.). This approach is understood as “lesson learned” through extensive trialand-error cross-border activities and responds to conflicting strategic needs with
flexibility by relying on selective decision-making processes. High levels of both
local adaptation and global standardisation are prototypically realised in this
approach (Bartlett & Beamish, 2014).
Although media management research has already investigated mainly big media
companies’ different strategies to engage across borders (see, e.g. Gershon & Suri,
2004; Doyle, 2006; Altmeppen et al., 2007; Oba & Chan-Olmsted, 2007; Chalaby,
2011; Mora-Figueroa, 2015—to name just a few), all these previous approaches
present a blind spot regarding the transformative nature of media markets (Möller
et al., 2019, p. 304). The question of what digitisation as example of a recent change
in the media sector means in relation to cross-border strategies has been rarely
explored so far.
First insights are provided by von Rimscha et al. (2019), who have observed the
effects of digitisation on cross-border activities of German-language media companies. Digitisation, they argue, has on the one hand led to a measurable increase in the
quantity of cross-border business dealings—more cooperative work, more innovatio
and more licensing business due to the highly fragmented media market. Indeed,
media companies engaging across borders are increasingly relying on license trading, since this allows to parcel out media products and services into small pieces.
This way many smaller licenses can be issued for a single product, thus serving
multiple markets. This means: the number of individual business dealings increases,
but the deals themselves get smaller and smaller. Although overall market hierarchies remain persistent, both business opportunities and market balance in the media
sector are still shaped by cultural and linguistic differences, as mentioned in the
previous section; media companies that focus either on generic or on niche market
products, as well as large media companies that have already overcome their
language barriers, can benefit from digitisation.
For those who haven’t overcome their linguistic barriers—i.e. non-dominant
language media companies—von Rimscha et al. (2019, p. 534) identify three options
to adapt their cross-border strategies to changes caused by digitised markets:
(1) Market exploitation. This way, media companies focusing on niche products
and markets can avoid engaging in markets where they have competitive disadvantages. (2) Geographical focus. Thus, only markets presenting cultural proximity are
served (see also Egger & Lassmann, 2012). (3) Expertise strategy. Here pre-existing
products are combined with new, more generic business models and technologies
(see also Teece, 2014). While market exploitation and geographical focus can be
understood as developmental and directed change management, where companies
improve their existing skills, processes and strategies (developmental) in order to
achieve specific purposes (directed), the expertise strategy can be interpreted as (r-)
evolutionary change management, as it comes from a natural process of strategy and
2
Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
25
performance adjustments (evolutionary) and is simultaneously forced by external
forces (revolutionary) (Kerse, 2018, p. 388; Morin, 2018, p. 116 f.).
Reflecting on the findings of von Rimscha et al. (2019), it seems clear that the
afore-mentioned typology of Bartlett and Ghoshal (1989, see Fig. 2.1) is no longer
sufficient to describe cross-border strategies for media companies in an environment
constantly changing and asking for change management, since strategies are much
more product-dependent and product-specific and therefore not transferable or
applicable to the entire portfolio or the whole media company. This assumption is
further confirmed by recent research.5 Docking on structuration theory, we assume a
recursive coupling of structure and agency, this means of market and company. In
other words—as already mentioned above—what media companies are doing across
borders is at the same time how cross-border markets are characterised. This way we
focus on the structure behind the cross-border activities of media companies, being
able to display a specific mode of interaction taking effect in activities, i.e. a specific
mode of strategy in execution. Hence, we show how media companies acting across
border do not follow a single strategy, but rather flexibly combine different strategies—and they do so on the level of activities. Related to Bartlett and Ghoshal’s
matrix shown in Fig. 2.1, a company applies, for example an international rather than
a multinational, global or transnational strategy for a single cross-border activity
(i.e. licensing, cooperation, co-production, format trade, etc.). The strategy applied
for a single activity results then from an interplay of (1) activity type—which
requires, to a greater or lesser extent, a necessity of local adaptation and entails a
high or low standardisation potential—(2) the product type (i.e. niche or mass
product, info vs. entertainment, special vs. general interest, cultural background,
materiality, etc.) and (3) cultural context. Media companies engaging across borders
are therefore seeking to combine culture-specific localised activities with (more)
global activities, since local adaptation remains relevant for media as cultural goods
and standardisation is essential for their economic survival. Therefore, the transnational strategy regarded as being the most promising strategy for media companies
acting across borders (as argued by, e.g. Chalaby, 2009; or Gershon, 2000) has to be
understood and interpreted as “meta strategy” in a new, digitised and fragmented
media world. This means the transnational mentality results from flexibly applying
diverse strategies that are not necessarily transnational themselves. This way, it is
easier for media companies to react to constantly changing structures and frameworks of a digitised media environment without having to change the overarching
strategy for the entire company. This in turn is more effective, more efficient and less
expensive and can be interpreted as an improved version of the patching strategy of
Here we refer to original results of the international “cbmc-research project” (see footnote 3)
presented in particular by Möller et al. (2018) in their paper “Beyond the Transnational: Comparing
and Explication Media Companies’ cross-border strategies” at the European Media Management
Association (EMMA) in Warsaw, as well as by Voci et al. (2018) in their paper “From the
transnational to the flexible solution: A comparison and characterisation of media companies’
cross-border strategies” presented to the seventh European Communication Conference (ECC) in
Lugano. For further information, see: www.cbmc.info.
5
26
D. Voci and M. Karmasin
change management, where (temporary) structures are built to allow managers to
continually restitch their business to match changing market opportunities (Synnot,
2014).
2.4
Conclusion
The media environment has traditionally served as a showcase of structural changes.
Its structures were not least mixed up due to border crossing and digitisation. In this
chapter, we have tried to show that both the media industry and media companies are
not just passive spectators of such changes but—in the sense of a recursive relationship between structure and agency—active (co-)creators of these changes. This
applies in particular to the market level, in terms of framework conditions and
structures enabling or constraining media companies’ opportunities for action; to
the level of media companies themselves, by changing and reinventing their identity,
core competencies and scope for actions; as well as to the action level, by changing
and restructuring the strategies media companies (have to) apply in regard to the
changed structures.
The latter above all calls for a change of strategic mentality in doing cross-border
business. The new digitised media environment requires a shift from a static
overarching corporate strategy to a more selective change management focused on
specific strategic considerations depending on the single cross-border activity’s
character and foreign market’s framework conditions: from hierarchies and planned
processes to selective (re-)action and flexibility. This new required mentality has to
be understood as an expression of how to make the unpredictable a little more
predictable, of how to make the unknown a little more manageable. As mentioned
above, digitisation offers both opportunities and challenges while making the fast
pace of the media environment even faster and therefore more complex. Media
managers agree that these new difficult conditions can only be managed through
know-how sharing and restructuration of their own business models (see Schwarz
and Gustafsson; Green and Malthouse in this volume). So-called traditional media
companies have to leave their old ways behind them—i.e. they have to detach
themselves from their familiar and consolidated business model and move towards
a completely different, new, innovative and therefore risky and unknown direction in
order to not lose sight of the main goal: achieving digital economy of scale. To reach
this goal, media companies have to continue to position themselves in strategic,
sometimes emerging markets, so that they don’t miss the “next big thing” of the
media industry, after the smartphone, the platforms and the digital revolution, in
order to be prepared to actively contribute to the new structural change(s) that will
certainly come. This new way to operate can thus be interpreted as a strategy of a
transitional change management, where media companies and managers have to let
go of their old way of operating while the new one is being put into place, but
without having to pass through the trial-and-error phase of a transformative change
2
Cross-Border Media Management in a Digital Environment: Challenges and Less. . .
27
management, since the ultimate goal can be visualised in detail before the transition
(Ackermann Anderson & Anderson, 2010, p. 9).
However, the risk with all these new challenges, opportunities, changes and
change management strategies still remains the same old one for the media sector:
overlooking or rather pushing the social relevance of media as cultural goods into the
background, while profit maximisation and scalability become the new guidelines of
media companies, instead of creating a public sphere, or rather acting as a watchdog,
representing social interests, educating and activating for political participation.
Hence, while looking for “the next big thing in media industries”, the fear of the
loss of importance of media as institutions should be at least as big as the fear of not
reaching the critical amount for scalability. This in turn requires integrated, successful and proactive change management, which not only ensures the economic quality
of media but also doesn’t endanger and overlook its social and cultural quality.
2.5
Exercise and Reflexive Questions
1. What are possible change management responses to changing cross-border competition, triggered in particular by digital players?
2. To what extent do media markets and media companies stand in a recursive
relationship to another?
3. Why can the relationship between traditional media companies and digital platforms be described with the “prisoner’s dilemma” metaphor? What are successful
change management responses to deal with it?
4. To what extent can the transnational strategy as meta-strategy be understood as
both transformational and transitional change management strategy?
5. What kind of risk do media managers face while trying to reach the “next big
thing” in the media industry? Why is it relevant for media management?
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Komparative
Mediensystemforschung
grenzüberschreitender
Voci,
D.
Medienkommunikation. Eine medienökonomisch geleitete Analyse. Dissertation an der AlpenAdria-Universität Klagenfurt. Klagenfurt.
Voci, D., Karmasin, M., Nölleke-Przybylski, P., Altmeppen, K.-D., Möller, J. E., & von Rimscha,
M. B. (2019). What is a media company today? Rethinking theoretical and empirical definitions.
SCM–Studies in Communication and Media, 8(1), 29–52.
Voehl, F., & Harrington, H. J. (2016). Change management. Manage the change or it will manage
you. CRC Press.
Voltmer, K. (2013). The Media in Transitional Democracies. Polity Press.
von Rimscha, M. B., Möller, J. E., Voci, D., Nölleke-Przybylski, P., Altmeppen, K.-D., &
Karmasin, M. (2019). Can digitization help overcome linguistic and strategic disadvantages in
international media markets? Exploring cross-border business opportunities for Germanlanguage media companies. Media, Culture & Society, 41(4), 520–538.
Weichert, S., & Kramp, L. (2009). Das Verschwinden der Zeitung? Internationale Trends und
medienpolitische Problemfelder. Friedrich-Ebert-Stiftung.
Werner, S. (2002). Recent developments in international management research: A review of 20 top
management journals. Journal of Management, 28(3), 277–305.
Denise Voci, PhD, is Senior Scientist at the Department of Media
and Communications at the University of Klagenfurt. She wrote
her doctoral thesis within the framework of the international
research project, “The management and economics of crossborder media communication—a study of the transnational relations between market structures and media management”, about
comparing media systems from a media economic point of view.
Her research interests include cross-border media management
and comparative media systems research, as well as sustainability
and environmental communication. For further information please
see: https://campus.aau.at/visitenkarte?atoken=-574185635.
Matthias Karmasin is Director of the Institute for Comparative
Media and Communication Studies of the Austrian Academy of
Sciences and the University of Klagenfurt, where he is full professor for media and communication sciences. His research areas
concern organisational communication, media ethics and media
management, political communication, communication theory,
media practice and media accountability. For further information,
please
see
https://www.oeaw.ac.at/cmc/the-institute/staff/
matthias-karmasin/.
Chapter 3
Strange Bedfellows? Business Modelling,
Convergence and Change Management
Veronika Gustafsson and Erich J. Schwarz
Abstract The chapter addresses the interrelationship between the concepts of
change management, the phenomenon of convergence of technologies and business
model innovation. A central task of change management is the adaptation of
companies, for example, due to changing conditions such as technological or
ecological change. The change can affect many areas such as the objectives of the
company, the strategies, business models or even individual products and processes.
The chapter focusses on the management of business model innovation, which is
triggered in particular by the convergence of technologies. The theoretical explanations are supported by examples from various industries such as the media
and automotive industries. The chapter starts with an elaboration on the convergence
and its predecessors in the business context. Further, the concept of business model
and business model innovation is introduced and defined; also, business model as a
field of research is presented and discussed. Finally, the chapter evaluates the fit
between business models and different types of convergence. The concepts of
change and change management are introduced as well, and their key aspects are
discussed.
V. Gustafsson · E. J. Schwarz (*)
Uppsala University, Uppsala, Sweden
University of Klagenfurt, Klagenfurt, Austria
e-mail: veronika.gustafsson@fek.uu.se; erich.schwarz@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_3
33
34
3.1
V. Gustafsson and E. J. Schwarz
Introduction: A Morning with Convergence
and Change1
On a spring morning a young entrepreneur is preparing for a workout. She steps out
of the door and starts her new Tesla to drive to a close-by hill. The sky is almost
cloudless and her running path brings her high up into the hills. Now and then she
checks her progress on her watch. It’s a fairly smart device, which shows altitude, the
runner’s position, speed and heart rate and it looks stylish enough. Now it’s time for
a rest and early morning news, so our runner stops and switches her smartphone from
playing music on her Spotify playlist to FM-radio mode. Because the scenery is so
beautiful she takes a picture with her smartphone and sends it via WhatsApp to her
parents who live hundreds of kilometres away.
On the way home she activates the autonomous driving mode. In the future, she
will probably use the driving time to answer company emails or watch the news. . . .
This or something similar would have been the morning of our protagonist before the
corona crisis started. Due to the lockdown caused by Covid-19, so much in her life has
suddenly changed. She still does her morning workout, only the place and the exercises
are different. In her living room in front of her laptop, she follows the instructions of a
trainer at her gym, where she used to work out two or three nights a week.
This is possible because the owner of the gym responded quickly to the crisis and
the resulting absence of customers. In order not to lose the current subscription
customers and perhaps even to gain new ones, he very quickly changed his business
model. Thus, he streams various fitness courses online every day and gives advice to
his customers via Zoom or Skype for a small fee, which can of course be paid
electronically. He has also set up a special channel on YouTube for his subscription
customers, where he uploads some of the recorded exercises.
In the case of our heroine, not only has her morning schedule changed. After the
online supported workout and a quick coffee, she starts a video conference with her
business partner with whom she founded a small but fast-growing biotech firm 5 years
ago. But will the company survive the current crisis and what will happen afterwards?
Can the company stay competitive in its rapidly changing, unpredictable environment?
Is the business model sustainable or does she need to introduce something radically
novel in order to keep up with the pace of innovation in the industry? Could these
changes become detrimental to the participative culture of the company?
Now, let us for a moment forget about the runner. This short case demonstrated
several examples of convergence, including convergence of industries and convergence of devices/products. Moreover, in our examples we could see convergence of
both media and non-media-related issues; and if we consider the gym owner, the
case has pointed out how innovative business models can support a company
through times of high uncertainty and crisis.
“A major portion of this chapter is reused from the author’s earlier publication: Gustafsson, V.,
Schwarz, E. J. (2013). Business Modelling and Convergence. In: Diehl, S. & Karmasin, M. (Eds.)
Media and Convergence Management, (pp. 9–23). Berlin: Springer. Used with permission”.
1
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
3.2
35
Convergence of Device or Product
Examples of convergence products (or convergence devices) are quite numerous;
you can easily identify them in the description above: it is, of course, a smartphone
which combines the functions of mobile telephone with the possibility to take photo
and video pictures, listen to FM radio and access the Internet. If proper apps are
installed, it becomes possible to use Spotify or read newspapers online. In other
words, a convergence product, such as a smartphone, is “a digital-platform product
bundle that physically integrates two or more digital-platform technologies into a
common product form” (Han et al., 2009, p. 97).
Quite often convergence products also involve convergence of media. For example, an online newspaper can be quite different from its paper counterpart. First and
foremost, it is often interactive. One click will bring you from the text of an article
(which is quite similar to the paper version) to the comments, where you can interact
with other readers (something which is quite impossible for the “old media”). The
majority of online newspapers and magazines now incorporate video and audio
clips, blogs and multimedia charts; most of them also provide apps to be accessed
from smartphones and tablet PCs. Here we can also see convergence of content, as
well as of media: news, sports, weather forecast, book reviews, etc.—and everything
is (or can be) interactive.
However, convergence products do not necessarily presume convergence of
media. Let us take as an example the sport watch from the runner’s story above.
This is a digital device which incorporates a watch, a stopwatch, a GPS, a calorie
counter, etc. Usually such watches are controlled by special software which should
be downloaded to your PC and which provides an array of extra opportunities: from
devising your favourite running tours to creating a workout programme (which is an
example of content convergence) (Gustafsson & Schwarz, 2013, p. 10).
Finally, let us also take a brief look at the autonomously driving car used by our
protagonist. To put it bluntly, it is probably more of a computer network with sensors
and actuators on four wheels, which is also capable of transporting people. The
computers integrated into the vehicle fuse the data supplied by various sensors such
as laser, video or radar and use them to form an image of the perceived environment.
Based on this, the computers make decisions that are sent to the actuators in the form
of electrical signals. These in turn convert the received signals into mechanical
movements such as steering and braking. Machine learning is used to handle the
large amounts of data involved in recognising people, other cars or traffic signs, for
example.
36
V. Gustafsson and E. J. Schwarz
Fig. 3.1 Examples of industry convergence. Adapted from Lechner (2003, p. 309)
3.3
Convergence of Industry
So, the characteristic feature of convergence products like those described above is
incorporating several devices in one. Often enough all these constituent devices are
products of the same (digital) industry; yet at times they come from industries as
different as TV production, software engineering and newspaper printing, as in the
case of online newspapers, and then we can speak of industry convergence.
According to Bröring, Cloutier and Leker (2006, p. 487), “industry convergence,
defined as a ‘blurring’ of boundaries between industries, induced by converging
value propositions, technologies and markets. . .lead to the emergence of interindustry segments”. Although industry convergence has been mostly studied in the
fields of computing, communication and consumer electronics (Wirtz, 2001; Chon
et al., 2003), convergent industries and the products they produce are much more
numerous. Back in 1998 Prahalad already mentioned the emergence of personal care
products, such as body lotions, and the so-called cosmeceuticals. These products
appeared as a result of convergence with the pharmaceutical industry, when manufacturers of personal care products emulated technologies and industry norms of the
pharmaceutical industry.
Also a new segment, the so-called nutraceuticals and functional foods are the
result of convergence between the food industry and pharmaceuticals. Manufacturers in the emergent convergence sector would apply similar (or the same) technologies, similar regulatory requirements and even pharmaceutical-style clinical
trials (Gustafsson & Schwarz, 2013, p. 11).
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
37
In the case of autonomous vehicles, not only do industries such as the automotive
industry and the information and communications industry converge, but it also has
the potential to fundamentally change our mobility behaviour. Examples are concepts such as vehicle on demand, which offer future users independent mobility even
without a driving license and their own car. Thus, autonomous mobility, possibly as
a new industry, leads to a convergence of the classic car industry, computer and
software industry and artificial intelligence.
Figure 3.1 can provide more examples of industry convergence.
3.3.1
Convergence: Back to the Future
Convergence is a fairly modern idea; however, its underlying principles may be
thousands of years old. Modern examples, such as nutraceuticals and functional food
(energy bars and fortified orange juice), which provide additional nutrition and
health benefits, are sophisticated products of convergence in two industries: pharmaceutical and food industry (Gustafsson & Schwarz, 2013, p. 12).
Chinese diet therapy (which is at least three thousand years old) has always
considered the nutritious and medical property of all foodstuff; therefore, Chinese
nutritionists would recommend appropriate foods depending on the age of the
consumer and the season when the food is consumed (Kastner, 2009; and Gustafsson
& Schwarz, 2013, p. 12).
Convergence products, even though they are a fairly recent phenomenon, have a
clear predecessor in business strategy called product bundling. According to Bakos
and Brynjolfsson (1999, 2000), bundling is especially efficient for digital “information goods”, like software, which also have close to zero marginal cost. When you
buy a Microsoft Office software package, you buy a product bundle of a word
processor, a spreadsheet, a database, a presentation software, etc. Similarly, the
Windows operative system is a bundle of an operative system proper and a web
browser.
Yet product bundling occurs not only in the software industry. This strategy is
common whenever manufacturers can exploit economies of scale and scope, with
low marginal costs of bundling and high costs of production set-up. Here come more
examples familiar to everybody: cable TV providers, which bundle different channels into a package (Gustafsson & Schwarz, 2013, p. 12), or travel agencies, which
bundle, e.g. travel, accommodation and entertainment.
Since we have already mentioned industry convergence, let us point out that it is
not entirely novel either. Henry Ford’s strategy provides a striking example.
According to Byron King (2008), in October 1908 Ford announced his intention
to “build a car for the great multitude”. At the same time the Ford Motor Company
started manufacturing its first mass-produced automobile called the Model T, which
revolutionised transportation and much of the American industry.
Fifty years prior to Ingvar Kamprad and IKEA, Henry Ford had shipped his cars
disassembled, in kits, to be assembled on regional sites in large cities. Later on, Ford
38
V. Gustafsson and E. J. Schwarz
had innovated the manufacturing and started shipping complete cars; yet convergent
thinking stayed on his mind and in his business philosophy (or became part of his
business model, as we would say today) (Gustafsson & Schwarz, 2013, pp. 12–13).
Customers who could not afford the price of the car could take a loan from the
business’ financial division, which Ford had created to cater for such needs (King,
2008; and Gustafsson & Schwarz, 2013, p. 13).
3.3.2
Convergence Today: New Technologies, New Thinking,
New Business Models
And yet, even if processes similar to convergence, like product bundling, are not
especially novel (or, sometimes, are really ancient practices), it would be rash to
assume that modern convergence is entirely similar to its predecessors. In fact, it is
quite different. Convergence products are more complex and sophisticated than
product bundles (Gustafsson & Schwarz, 2013, p. 13).
In other words, what makes industry or product convergence so different from
previously existing phenomena is entirely new thinking. Convergence industries and
convergence products are not mere results of radically novel technologies; most
importantly, they support innovative business models. 3-D printing would be an
ultimate convergence example, because it does not just bring together several
industries (i.e. design and manufacturing), but it also incorporates consumers into
the very process of manufacturing, turning them into “prosumers” (Gustafsson &
Schwarz, 2013; Holzmann et al., 2017; see Terlutter & Ninaus and Diehl et al. in this
volume).
Product bundling offers another example. As we already mentioned, bundling is
most beneficial for high volume and high margin products, especially when demand
is heterogeneous. In this case, the manufacturer does not have to be especially
customer-oriented; in fact, a bundle of products with inferior quality can drive off
the market a bundle of superior quality products (Bakos & Brynjolfsson, 1999,
2000). In oligopolistic and monopolistic markets, where bargaining power is shifted
towards the manufacturer, bundling can become an abuse of market power, due to
the limited choices available to consumers (Gustafsson & Schwarz, 2013, p. 13).
By contrast, convergence products are often customer-centric and presume integration of several technologies. As such, they are products of entirely different
business models, which are based on value creation not only for the focal firm but
for all its stakeholders (i.e. suppliers, partners and customers). Such business models
often incorporate innovative technologies, but for them technological innovation is
no longer the core; rather, all business model components can become innovative
(Amit & Zott, 2001; and Gustafsson & Schwarz, 2013, p. 13).
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
3.3.3
39
Business Models: Convergence of Technology,
Stakeholders and Value Creation
So, to begin from the beginning, what is a business model? According to Henry
Chesbrough and Richard Rosenbloom, a business model performs the following
functions:
• “Articulates the value proposition (i.e. the value created for users by an offering
based on technology);
• Identifies a market segment and specifies the revenue generation mechanism
(i.e. users to whom technology is useful and for what purpose);
• Defines the structure of value chain required to create and distribute the offering
and complementary assets, needed to support position in the chain;
• Details the revenue mechanism(s) by which the firm will be paid for the offering;
• Estimates the cost structure and profit potential (given value proposition and
value chain structure);
• Describes the position of the firm within the value network linking suppliers
and customers (incl. identifying potential complementors and competitors); and
• Formulates the competitive strategy by which the innovating firm will gain and
hold advantage over rivals” (Chesbrough & Rosenbloom, 2002, p. 529)
So far, so good; yet other research of business models would provide quite
different definitions. This is unfortunate, because the business model is a concept
highly relevant for practitioners; let us now find out what is going on in the research
field of the business model (Gustafsson & Schwarz, 2013, p. 14).
3.4
Business Model: Research Overview
A comprehensive literature review on business models was published by Zott, Amit
and Massa almost a decade ago (2011). Then, the authors arrived at the conclusion
that the study field, despite being in existence for about 20 years, was quite
dispersed.
They stated that the number of research papers in peer-reviewed (especially highranking) journals was still insufficient to create an ample body of research and enable
theoretical integration and conceptualisation of the field, although practitioneroriented publications target a broad array of sectors, technological innovation and
management taking a prominent place (Gustafsson & Schwarz, 2013, p. 14).
According to Zott et al. (2011), more than one third of the articles the authors
surveyed did not provide any explicit definition of the concept and quite often, while
referring to business model, different authors actually mean different concepts. In
other words, “the business model has been referred to as a statement (Steward &
Zhao, 2000), a description (Applegate, 2000; Weill & Vitale, 2001), a representation (Morris et al., 2005; Shafer et al., 2005), an architecture (Dubosson-Torbay
40
V. Gustafsson and E. J. Schwarz
et al., 2002; Timmers, 1998), a conceptual tool or model (George & Bock, 2011;
Osterwalder, 2004), a structural template (Amit & Zott, 2001), a method (Afuah &
Tucci, 2001), a framework (Afuah, 2004), a pattern (Brousseau & Penard, 2006) and
a set” (Seelos & Mair, 2007) (in Zott et al., 2011, p. 1022) (Gustafsson & Schwarz,
2013, pp. 14–15).
In the meantime, the situation has improved and business models have evolved as
a distinct unit of analysis (Zott & Amit, 2013). Special issues on business models and
business model innovation in academic journals, such as Long-Range Planning
(2013, 2018), R&D Management (2014) and Strategic Entrepreneurship Journal
(2015), proved the importance of the topic also for the research community. Further,
various studies (e.g. Hu, 2014; Velu, 2015) have concluded that a business model
can positively influence the performance of companies.
Despite the field’s growing importance, empirical research on business models is
still scarce. Several scholars (e.g. Wirtz et al., 2016; Teece, 2018) have therefore
underlined the importance of a reasonable knowledge base of business models.
All these issues point out that the field requires (a) a growing body of research
which would investigate the concept of the business model across a variety of
empirical contexts (and not only within e-business) filling in multiple research
gaps, (b) conceptual consolidation and theory-building growing from the cumulative
body of research and c) methodological rigour, including operationalisation of the
concept (Gustafsson & Schwarz, 2013, p. 15).
3.5
Business Model Research: Conceptualising the Field
Business model studies can benefit from collaboration with other disciplines. Indeed,
the business model is a complex phenomenon, a dynamic combination of activities
and agents, which is systemic by nature (Zott et al., 2011; Afuah & Tucci, 2001). As
it concerns not just the focal firm, but its boundary-spanning activities and numerous
stakeholders, theoretical conceptualisation of the field can benefit from the following
contributions, to name just a few: (a) stakeholder theory, institutional theory and
network theory, which would highlight the relationship component of the business
model phenomenon; (b) transaction costs theory and Michael Porter’s concept of
Five Forces, which shed light on the strategy aspects of business model concept;
(c) and, finally, an overall paradigm of grounded theory which can be successfully
employed to investigate this complex, holistic and emergent phenomenon. Morris
et al. (2005) provide similar arguments, as they conceptualise the study of business
models through contributions from strategy (e.g. the value chain, value systems and
strategic positioning concepts (Porter, 1985, 1996)), resource-based theory and
competitive advantage (Barney et al., 2001), strategic network theory (Jarillo,
1995), etc.
Another interesting example is found in the literature on business planning and
entrepreneurship (cf. Ardichvili et al., 2003; Brush et al., 2001; Shane & Delmar,
2004). Studies within the business planning literature treat the concept of business
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
41
model in a different way, even though they acknowledge (implicitly or explicitly) the
interrelation between business planning and creation of business models. For example, Shane and Delmar (2004) pose that a business plan outlines the new venture’s
business model; a business model which “makes sense” is an antecedent to successful business planning. Sahlman (1997) implicitly regards the business model as a
revenue model and a possibility for an entrepreneur to introduce key financial
milestones for a business plan. Schwarz et al. (2013) also provide a practitioneroriented discussion of the business model as a part of a venture creation process.
Finally, Ardichvili et al. (2003) introduce an all-encompassing approach to business
planning and business modelling; according to these authors, business model development is an antecedent to the development of a business plan. Most importantly, the
researchers view a business model as a holistic concept, which includes a financial
model and, most importantly, which estimates how the value will be created and
distributed among a firm’s stakeholders. In turn, a business plan emerges when a
business model is supplemented by more elaborate and formal means of analysis and
forecast, e.g. formal cash flows and marketing plans. It is possible to conclude that
although business planning and the creation of business models are two closely
interrelated and partially overlapping processes within new venture creation, they
are, nonetheless, distinct from each other (Gustafsson & Schwarz, 2013, pp. 15–16).
3.6
Business Model Components
Although empirically oriented papers describe components of business models, the
majority of papers still lack theoretical conceptualisation and analysis of these
components. Papers remain to a large extent almost purely descriptive, especially
as far as e-business is concerned (Gustafsson & Schwarz, 2013, p. 16).
Unfortunately, business model studies also demonstrate little agreement as far as
the number (and nature) of the business model components is concerned. According
to a literature review provided by Morris et al. (2005), the number of business model
components in different studies varies from four to eight; among the most frequently
cited elements are the firm’s value offering, economic model, customer interface/
relationship, partner network/roles, internal infrastructure/connected activities and
target markets (Morris et al., 2005, p. 727). Sustainability as a business model
component is mentioned first, by Afuah and Tucci (2001). Yet a number of
practitioner-oriented papers (cf. Nidumolu et al., 2009; Gregori et al., 2019) regard
sustainability as a key driver of innovation, both when innovative technologies and
innovative business models are concerned. Table 3.1 provides an overview of
business model components, compiled by Morris et al. (2005) (Gustafsson &
Schwarz, 2013, p. 16).
A pioneering comprehensive attempt at operationalisations of business models is
made by Amit and Zott in their paper of 2001. The researchers regard the business
model as an important locus of innovation and a crucial source of value creation not
only for the focal firm but also for all its stakeholders, i.e. customers, suppliers and
42
V. Gustafsson and E. J. Schwarz
Table 3.1 Perspectives on business model components (Excerpts from Morris et al., 2005, p. 728)
Horowitz
(1996)
Timmers
(1998)
Markides
(1999)
Donath
(1999)
Linder and
Cantrell
(2001)
Gartner
(2003)
Afua and
Tucci (2001)
Alt and
Zimmerman
(2001)
Specific components
Price, product, distribution, organisational characteristics and technology
Product/service/information flow architecture,
business actors and roles,
actor benefits, revenue
sources and marketing
strategy
Product innovation, customer relationship, infrastructure management,
financial aspects
Customer understanding,
marketing tactics, corporate governance, intranet/
extranet capabilities
Pricing model, revenue
model, channel model,
commerce process model,
Internet-enabled commerce relationship,
organisational form and
value proposition
Market offering, competencies, core technology
investments and bottom
line
Customer value, scope,
price, revenue, connected
activities, implementation, capabilities and
sustainability
Mission, structure, processes, revenues, legalities
and technology
Number
5
E-commerce/
general
G
Empirical
support
Y/N
N
5
E
Y
4
G
N
5
E
N
8
G
Y
70 interviews with
CEOs
4
E
N
Consulting
clients
8
E
N
6
E
N
Nature of
data
Detailed
case
studies
Literature
synthesis
partners. The authors suggest that a business model incorporates four major sources
of value creation: efficiency, complementarities, lock-in and novelty.
Efficiency implies that the cost of each transaction (broadly defined) decreases,
i.e. the higher the efficiency of a business, the lower its costs and the greater its value.
Efficiency includes search costs, selection range, symmetric information, simplicity,
speed, economies of scale, etc. (Amit & Zott, 2001, p. 504).
Complementarities mean that goods (or services) bundled together provide additional value compared to the total value of each of the goods taken separately.
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
43
Fig. 3.2 Sources of value creation in e-business (Amit & Zott, 2001, p. 504)
Examples of complementarities would include after-sales services, or one-stop
shopping, or cameras in mobile phones; in other words, these are also examples of
product or industry convergence. Complementarities are found between products
and services for customers, between online and offline assets, between technologies,
between activities, etc. (Amit & Zott, 2001, p. 504).
Lock-in is a way to enhance a business’ value-creating potential by attracting
customers to repeated transactions and by motivating partners to maintain and
improve their co-operation. By increasing switching costs, lock-in prevents customers and partners from migrating to competitors. Examples of lock-in activities
are loyalty programmes, use of dominant design, trust, customisation, use of positive
network externalities, etc. (Amit & Zott, 2001, p. 504).
Finally, innovation is understood as Schumpeterian innovation, i.e. the introduction of new products, services, methods of production, creation of new markets as
well as innovative ways to conduct business, in other words, by pursuing innovative
methods of transactions or creating innovative business models. Figure 3.2 demonstrates the interconnection between the four sources of value creation in a business
model and also describes the ways by which each of them can be achieved
(Gustafsson & Schwarz, 2013, pp. 16–18).
Convergence: Which Business Model?
So, how can a convergence firm willing to implement an innovative business
model find its way in the jungle of business model research? Which definition should
it follow? Which issues should it consider? The present section will provide at least
tentative answers.
44
3.7
V. Gustafsson and E. J. Schwarz
The Tale of Two Models: Complementary vs Lock-in
Is Apple’s business model viable? Since the company is considered an innovation
paragon, the first intuitive answer is very likely to be affirmative; yet, let us consider
a segment traditionally regarded as Apple’s core competence, namely, personal
computers, and let’s go back to the end of the last millennium.
In 1999 Apple’s worldwide market share in personal computers was about 4 per
cent; in 2006 it dropped down to 2 per cent and by the end of 2010 it rose again to
slightly above 5 per cent.
However, there is a market where Apple performance falls just short of fantastic.
This is the digital music market, where Apple introduced a new product in 2003—
iPod, a radically new service—iTunes. . . and a ground-breaking business model,
which combined the hardware, the software and service, making digital music
downloads simple, easy. . . and legal. This kind of innovation yielded immediate
and striking results: in just 3 years since its launch, the combination came to account
for about 50 per cent of Apple’s revenue (Gustafsson & Schwarz, 2013, pp. 18–19).
Apple continued the success story with the introduction of the first iPhone in 2007.
With the smartphone, the company cannibalised its own market for iPods but
revolutionised the mobile phone market, which had previously been dominated by
Nokia. With the exception of the major product launch of the Apple Watch in 2015,
the company focussed primarily on differentiating design and functionality and on
hardware-software integration during the next decade. With the introduction of the
video streaming service in autumn 2019, Apple has again changed or shifted its
business model and is positioning itself more strongly as a provider of digital
services.
So, where lies the difference between immense success in one case and years of
fruitless struggle—in the other? To make the matter even more complicated, let us
bear in mind the fact that in both cases the company has employed an innovative,
state-of-the-art technology. The answer is, however, quite unambiguous and spells
out business model. Let us consider personal computers first. Even though Apple
keeps pursuing technological innovation, which represents a component of the
company’s business model, in general the business model can be considered quite
outdated. By linking hardware and software together, it narrows down consumers’
choice and requires them to keep paying Apple for the annual software updates;
otherwise computer performance will suffer. Such a model was en vogue in the very
beginning of the personal computer era. This model provides relatively high profit
margins, but discourages consumers and severely decreases sales volumes (and
hence, market share). However, the model is well in line with the niche market
strategy; yet it can be hardly recommended for the mass market.
In the case of digital music players, the situation is exactly the opposite. Apple
was able to unite innovative technology, as a component of its business model with
innovative service, which provided added value for several important stakeholders.
First, by creating a large and growing digital music archive and corresponding
software (iTunes), Apple gave consumers a one-click possibility to download digital
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
45
music, films, podcasts and apps immediately transferrable first to their iPods and
later on to iPhones as well as to other smartphones, mp3 players or PCs. Second,
Apple created a new market segment for the artists and film-makers; as a result, this
ground-breaking business model quickly became immensely successful and high
market share and revenues followed suit (Gustafsson & Schwarz, 2013, p. 19). With
the streaming service Apple seems to be following a similar path once again.
So, what conclusions can we derive from the example above? First, that Apple,
apparently, employs several business models, with different leading components and
that the same company treats convergence differently in different segments of its
product range.
In its core segment—personal computers—Apple apparently leans on lock-in as
the leading component of its business model. As was mentioned, such a business
model would yield high profit margin, yet it is detrimental if a company strives for
increased market share.
As far as the digital music and movie segment is concerned, Apple employs a
radically different business model, with complementarity as the leading principle
and a host of convergence products as a result.
3.8
Business Model Innovation and Organisational Change
As we have seen, the implementation of innovative business models (including
various types of convergence) can dramatically improve organisational effectiveness
and performance. And it is possible to assume that these dramatic improvements are
the results of broad changes within the organisations they concern.
The ever-increasing pace of technological, environmental and societal change,
such as the emergence of radical and disruptive innovations, including implementation of radically novel business models, changes in government regulations, changes
in demand and competition, affects organisations worldwide (Lant et al., 1992;
Pettigrew, 1987). So, designing and implementing change becomes vital for organisations (Brandt et al., 2019; Iveroth & Hallencreutz, 2015; Kegan et al., 2009).
Albeit essential for development and at times survival, organisational change is a
risky endeavour. According to research by Burnes (2009) or Hallencreutz (2012), as
a result of the change process, failure is much more common than success, with 70 to
80 per cent of all change initiatives never reaching their targets (Brandt et al., 2019).
If the change project concerns organisational culture, the failure rate is even higher,
reaching up to 90 per cent (Burnes, 2011). Causes of failure can be manifold;
ignorance or neglect of a company’s culture is, probably, one of the most prominent,
as is resistance to change among the organisation’s employees and management and
the inability of the organisation’s leaders to successfully design and implement the
change process (Hallencreutz, 2012; Kezar & Eckel, 2002; Newhouse & Chapman,
1996).
46
V. Gustafsson and E. J. Schwarz
Fig. 3.3 Varieties of change (Burnes, 2017, p. 403)
3.8.1
Types of Organisational Change
To make the matter even more complicated, strategic change comes in many shapes
and sizes, ranging in magnitude from all-encompassing and revolutionary to barely
perceptive and incremental. It can embrace the entire organisation or individual
departments or groups or even individual organisational members. Finally, the
process of change can range from continuous improvement (e.g. Japanese system
of Kaizen) to dramatic, yet fairly short-lived transformations (cf. Burnes, 2017). The
matrix in Fig. 3.3 provides examples of change processes, affecting either individuals or groups or entire organisational systems. On the other hand, organisational
change can range from incremental to continuous (with the punctuated in between)
at each of the three levels.
This typology, however, is far from exhaustive. According to Burnes (2017),
there are other classifications of strategic change, as presented by researchers such as
Dawson and Andriopoulos (2014) or Stickland (1998). Yet, the conclusion even
from the extended review would be similar, and the change can be presented as a
continuum from incremental to transformational. “Incremental or fine-tuning forms
of change are geared more to changing the activities, performance, behaviour and/or
attitudes of individuals and groups, whereas transformational change is geared
towards the processes, structures and culture of the entire organisation” (Burnes,
2017, p. 404).
There are finer points of distinction in how the concept of change is treated by
different strategists. Some researchers consider incremental change to be a relatively
unimportant event (i.e. Stace & Dunphy, 2001; Pettigrew et al., 1992). However,
Kanter et al. (1992) and Senior and Swailes (2010) would regard it as an important
part of the overall organisational transformation (Burnes, 2017).
There is no discrepancy, however, in how transformational change is perceived; it
is universally considered as being as one of the most crucial processes in the
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Strange Bedfellows? Business Modelling, Convergence and Change Management
47
organisations’ overall strategy. Yet different researchers are not in agreement
concerning the speed of the transformational change process: for example, Kotter
(1996) believes it to be a relatively slow process, whereas Peters (1989) suggests that
transformational change can be executed relatively quickly. Still, according to a
number of studies (Beer & Nohria, 2000; Stace & Dunphy, 2001), transformational
change can be either relatively slow or fairly rapid (Burnes, 2017).
3.8.2
General Framework for Change
It is possible to provide an overall framework for organisational change by combining the level at which change occurs (organisational or individual/group), the focus
of the change process and the leadership’s approach to change, as is demonstrated in
Fig. 3.4.
In the top half of Fig. 3.4, quadrants 1 and 2 demonstrate the types of large-scale,
organisation-wide changes, which focus on either the culture or the structure of these
organisations. These changes become relevant in situations when organisations are
functioning in rapidly changing, turbulent environment such as the crisis in the
health and economic system caused by Covid-19, and the pace of the environmental
change would make previously relevant structures and cultures obsolete (Burnes,
2017). Introduction of a new business model, especially if it requires significant
change of the organisational culture, is a good example of such an all-encompassing
strategic change.
In the bottom half of the figure, represented by quadrants 3 and 4, we can see the
situations when relatively small-scale change is appropriate. These changes may
include adjustments to the attitudes and behaviours or tasks and procedures of
Fig. 3.4 A framework for change (Burns, 2017, p. 407)
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V. Gustafsson and E. J. Schwarz
individuals and groups. In order to keep these changes sustainable, the post-change
organisational environment should be relatively stable (Burnes, 2017). This kind of
change usually accompanies incremental innovations.
If we consider changes to the organisational cultures, e.g. attitudes and behaviours of its management and employees, they are demonstrated in the left-hand side
of the figure, quadrants 1 and 4. As we have already discussed, a relatively slow,
participative approach is more appropriate to implement this kind of changes,
compared to a rapid and directive style of management. The right-hand side of
Fig. 3.4, quadrants 2 and 3, describes situations when the change process is mostly
focussed on the technical side of the organisation, i.e. structures, processes, tasks and
procedures. These types of changes tend to be less participative in nature and can be
implemented fairly quickly (Burns, 2017).
3.9
Conclusion: A Word of Advice
So, a word of advice for a company engaged in any kind of convergence: mind your
business model. Moreover, as we have seen from the examples, complementarity as
the leading business model component paves the road to growth and profitability;
complementarity here is understood quite broadly as involvement of customers and
other stakeholders.
In Amit and Zott’s (2001) model, complementarity goes hand in hand with
novelty or innovation. This would mean not only new technologies and new
products but, most importantly, new transaction structures, new transaction contents
and new participants (customers and other stakeholders). This is a revolutionary
approach, as it permits firms to innovate regardless of their technology status; for
example, it opens a road to innovation to service companies and not necessarily to
e-businesses only.
Complementarity and convergence eventually bring strange bedfellows to a firm,
yet in the long run this experimentation may turn quite profitable. For example, Choi
and Perez (2007) would suggest nothing less than teaming up with online pirates.
Although quite unorthodox, this advice makes good sense: first, online pirates are
usually pioneers of new technology, such as file-sharing/file transfer. Second, pirate
communities, which mostly consist of early adopters, can become a valuable source
of emergent market trends and other market insights. Third, online pirates are, in
fact, active market creators, as they migrate from the illegal use of copyrighted
material to legitimate business (e.g. becoming users of legal Napster or iTunes).
And, finally, online piracy has motivated incumbent firms (albeit rather unwillingly)
to consider the creation of new business models. For example, online piracy spurred
record labels to adopt Internet technology, create richer websites and engage in
electronic distribution modes.
Now, a final word of advice comes from Henry Chesbrough, one of the most
prominent business model researchers. According to him (Chesbrough, 2010),
companies should not be shy about experimenting with their business models. A
3
Strange Bedfellows? Business Modelling, Convergence and Change Management
49
necessary thing in this process is to differentiate “failures” from “mistakes”; while
“failures” are natural outcomes of experimentation which provide valuable learning
insights, “mistakes” are poorly designed experiments which provide no learning
(Gustafsson & Schwarz, 2013, pp. 20–21).
Yet, as we have mentioned earlier, introducing a radically novel business model
can be described as a clear example of transformational organisational change. If this
is the case, several important aspects must be considered.
Firstly, the reason, or “the why of change” (Pettigrew, 1987), has to be apparent
to the organisation’s employees and management; in other words, readiness for
change is essential (Brandt et al., 2019; Kegan et al., 2009; Lukas et al., 2007).
Second, it is crucial to remember that radical transformational change takes time,
and the lack of long-term orientation can lead to failure in change efforts (Kezar &
Eckel, 2002).
Third, the ability of the leader to create visionary goals and assume a long-term
perspective would inspire a company for the necessary changes and provide the
energy to pursue them (Joiner & Josephs, 2007).
Finally, an essential component of a successful change process is an
organisational culture prepared for change and people willing to take on challenges
and experimentation (Brandt et al., 2019).
3.10
Exercise and Reflexive Questions
To deepen and practice the content, please answer the following questions.
• What is a smartphone as described in the Introduction section: a bundle of
products or a convergence device?
• Please provide your own example(s) of functional foods and cosmeceuticals.
• What makes 3-D printing an ultimate convergence example?
• Are convergence products manufacturer-centric or customer-centric?
• What is the relationship (if any) between a business model and the revenue
mechanism by which a company is paid for its offering?
• What does efficiency mean in Amit and Zott’s (2001) model?
• Would you see lock-in as an appropriate source of revenue for a convergence
company? Why/why not?
• How can legitimate firms learn from online pirates (Gustafsson & Schwarz, 2013,
p. 21)?
• What is easier to change: an organisation’s culture or its structure? Why?
• If you consider it necessary to modify organisational culture, how could you
make this process sustainable?
Concluding questions give you food for thought and help you to reflect on the
text.
50
V. Gustafsson and E. J. Schwarz
1. Why do some practitioners believe that technological innovation is no longer the
core of innovative business models? In which industry (or industries) is this
situation possible? Does this reasoning hold for a high-tech company in a
convergence industry?
2. Why does Apple only hold a small percentage of the world’s PC market and a
large share of the digital music market?
3. Does Spotify have a future? Can you foresee any potential development of its
business model? Can you give examples?
4. If you follow the advice of Henry Chesbrough and introduce a radically innovative business model to your organisation, what kind of change would this process
require?
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Veronika Gustafsson is a Senior Lecturer/Associate Professor at
the Department of Business Studies at Uppsala University, Sweden. Her research interests include entrepreneurial decisionmaking and entrepreneurial cognition in general, including effectuation, as well as international entrepreneurship, business models
and female entrepreneurship in an international context. Social
media entrepreneurship is an emerging research stream she currently pursues.
Prof. Erich J. Schwarz is Dean of the Faculty of Management
and Economics at the University of Klagenfurt and Head of the
Department of Innovation Management and Entrepreneurship at
the University of Klagenfurt. Prof. Schwarz received his PhD in
Economic Engineering and has many years of experience in
research and teaching with research and teaching stays at several
universities in Europe and the USA. His research interests are in
the field of entrepreneurship and innovation management with a
focus on business models, innovation processes, sustainable
development in an entrepreneurial context and entrepreneurship
education. In total, Prof. Schwarz has (co-)authored more than
200 publications and participated—mostly in a leading position—
in more than 50 competitive projects. For further information,
please see: https://www.aau.at/en/team/schwarz-erich/.
Chapter 4
The Effects of Big Data on Media
Management
Gregory A. Green and Edward C. Malthouse
Abstract This chapter discusses how big data sets from digital media environments
are creating change-management challenges for media organizations. We discuss the
data and analytics factors that have driven these changes and, in doing this, anticipate
how these factors will affect the media industries in the future. Next, we propose a
framework for how media organizations should manage such changes, including
people, processes, data and technology, and incentives. We close by identifying
emerging factors that will likely have substantial effects—either positive or negative—in the future.
4.1
Introduction
Many industries have experienced substantial disruption over the past 25 years, and
among them perhaps none has been disrupted more than the media (see Voci &
Karmasin in this volume). The original impetus creating the disruptive force was the
Internet because it created networked, digital environments that enabled the easy
distribution of media products at virtually no marginal cost. Media products tend to
lend themselves to digital distribution, and physical media like compact disks,
newspapers, and video cassettes have largely been replaced by streaming and
downloads to an ever-expanding set of digital devices. The Internet also empowered
anyone to create their own media products and distribute them to global audiences
(Hennig-Thurau et al., 2010), bypassing traditional gatekeepers such as record
companies, news outlets, and movie studios.
One of the reasons that the disruption to media industries has been so great is that
revenue models that traditionally sustained them have had to be reinvented. For
example, news industries traditionally derived a majority of their revenues from
advertising. They would either give their products away for free or offer low
subscription rates to attract a large audience and then sell advertisers access to the
G. A. Green · E. C. Malthouse (*)
Northwestern University, Evanston, IL, USA
e-mail: greg.green@northwestern.edu; ecm@northwestern.edu
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_4
55
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G. A. Green and E. C. Malthouse
audience. Digital ad rates, however, have been substantially lower (“trade print
dollars for digital nickels”), and the control of access to audiences has largely shifted
to platforms such as Google and Facebook. Consequently, many news organizations
have closed, and those that remain have fewer reporters and produce less content
than before (Abernathy, 2018). Revenue models for music and other media industries have been similarly disrupted (Mortimer et al., 2012) by the Internet and later
various platforms.
While the Internet and the multitude of digital media devices are largely responsible for the disruption, an important component of this recipe for disruption that is
often overlooked is the data that is recorded by digital media and later used to
improve the customer experience and profitability (see Terlutter & Ninaus and Diehl
et al. in this volume). Google and Facebook have become advertising behemoths
largely because they know more about their users than traditional media, and this
detailed understanding of consumers has value to advertisers. They also create great
user experiences that consumers value, which make them the first destination when
consumers have, for example, a search need, but the success of such environments is
also supported by data and analytics.
This chapter will do three things. First, it will discuss the data and analytics
factors that have driven these changes and, in doing this, anticipate how these factors
will affect the media industries in the future. Second, we propose a framework for
how media organizations should manage such changes. We close by identifying
emerging factors that will likely have substantial effects—positive or negative—in
the future.
4.2
Data and Algorithmic Change Drivers Within
the Media
This section attempts to identify the most important data and algorithmic factors that
are driving change in the media industry. As mentioned in the introduction, the shift
to digital media means that consumer actions can be recorded (Hofacker et al.,
2016). Actions include many behaviors such as searching for or browsing media
products; paying for them; downloading, viewing, listening, to or reading them;
sharing them with others; clicking or viewing advertisements displayed in the
medium; and signaling attitudes toward them with comments, likes, etc. The collected data can be analyzed to create economic value for the owner (Malthouse et al.,
2019). For example, the data can be used to create more relevant, personalized
experiences for consumers, which make users more loyal to the media in the future
and willing to pay subscription or usage fees. The data could also be used to better
target advertising, with advertisers paying the owner a premium rate to find customers who are likely to purchase (Malthouse et al., 2018).
Media data are often spread across “owners.” For example, a cable TV company
may record what some household watches via its set-top boxes, but social media
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The Effects of Big Data on Media Management
57
platforms know what members of the household are saying about the programs. The
advertiser would like to know what the household is buying, but purchase data often
has yet another owner such as various retailers. Other media companies might know
what drove the household to watch certain programs, such as reading a review in the
newspaper or seeing friends discuss a program on social media. Malthouse and Li
(2017) refer to this as the jigsaw puzzle problem, where each data set is like a puzzle
piece in that it is not very interesting by itself, but when pieces are brought together
one has a complete picture of a consumer’s life or other situation.
As a rule of thumb, the more variables that an organization can own, the more
valuable the data become. The more that an organization knows about its customers,
the better it can personalize, target etc., improving its ability to monetize the data
(Yun et al., 2020). This observation explains the strategy of successful companies
like Google in offering services in many different categories—their advertising
business models depend on having a more complete picture of the consumer’s life,
wants, and needs: search, mobile phone and location (Android), Gmail, Chrome,
YouTube, calendars, Hangouts, etc. (see Schwarz & Gustafsson in this volume).
An issue that often comes up is linking behaviors to a user. This task is simplified
if the company requires users to log in first or use the company’s app. When users are
not required to log in, then it can be difficult to match, for example, some user’s
activities on her smart phone with her activities on her work computer, home
computer, etc. The company may leave a cookie behind on one of the devices, but
can only make approximate matches between devices. Additional difficulties occur
if the user clears her cookies or blocks them.
Malthouse et al. (2018) identify four classes of information that companies can
know about their users: first- and second-party behavioral data, third-party household characteristics, media consumption data, and contextual data. First-party data
includes the behaviors that an organization measures, such as purchase logs, click
histories, and outbound contact logs (e.g., emails sent). Second-party data is another
organization’s first-party data that the focal organization has purchased or traded.
Third-party data comes from a data provider, which often charges a fee. Examples
include demographics or lifestyle variables tracked by data vendors such as Experian
or Acxiom or firmographic variables collected by Dun and Bradstreet. Some add
“zero-party” data, which is data an organization gathers directly from consumers, for
example, through questionnaires or quizzes. Their motive is to obtain the consumer’s
participation and permission in personalizing products and services for them. Media
consumption data records what users view or read, and such information is of value
to advertisers to gain insights into user preferences (see Terlutter & Ninaus in this
volume). For example, knowing what types of pages a Facebook user likes or shares
or the TV programs or videos that a user watches would be valuable to an advertiser.
Malthouse et al. (2018) consider such media history as a separate category for
non-media companies such as advertisers, but for media companies it could be
considered first-party data.
Finally, the user’s current context consists of who, what, when, where, why, and
how (Malthouse et al., 2018). Who is the user with? For example, the relevance of a
movie recommendation and restaurant ad depends on the group receiving the
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recommendation. A father/husband would want different recommendations
depending on if he is alone, with his wife, with his 5-year-old daughter and her
friend, etc. What is the user doing? When is the media experience happening? Where
is the user currently located? How is the user accessing the media (e.g., big-screen
TV vs. mobile device)? Why is the user accessing the media? Understanding these
things enables the media organization to anticipate needs and create a relevant
experience. Context has been and is currently an active research area in many fields
including recommender systems. Adomavicius and Tuzhilin (2011) provide a thorough literature review of contextual personalization, discuss context-aware recommender systems, and identify three different algorithmic approaches to handling
context (see Saurwein in this volume).
Having outlined the role of data in creating change, we now discuss in more detail
some factors that have interacted with data to create the change.
4.2.1
Technology and New Digital Environments
The Internet first expanded the capabilities of media organizations by orders of
magnitude to gather data on their users. Other devices have been introduced since
then that have similarly expanded the ability to capture data, especially smart
phones, but also digital TV, the iPod/iPad, and intelligent personal digital assistants.
The Internet of Things (IOT) and home automation is when everyday objects are
connected to the Internet, enabling them to send and receive data. We are seeing
medical devices like pacemakers connected to the Internet with Wi-Fi. Likewise,
vehicles ranging from farming and industrial equipment to personal cars are
connected.
If we want to anticipate how big data will affect the media in the future, we need
to understand what new aspects of the consumer’s life will be digitized in the future
and the accompanying devices (Malthouse & Li, 2017; Huh & Malthouse, 2020).
With certainty, new devices will be introduced, and more devices will be connected
to the Internet creating even larger data sets, more detailed profiles of users, and
greater ability to personalize experiences and create greater value for users and other
stakeholders, such as advertisers.
4.2.2
Artificial Intelligence and Algorithms
Two of the most important algorithmic innovations for the media over the past
quarter century have been the recommender system (RS) and the models associated
with on-line auctions. RS includes the algorithms and technology used to help
consumers find items of interest to them (Ekstrand et al., 2011). The media industry
is one of the largest users of RS, ranging from Spotify and Pandora recommending
songs, Netflix and Amazon recommending movies and videos, originally Yahoo
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News and now Google News recommending news articles (Abdollahpouri et al.,
2021), and social media platforms like Facebook and LinkedIn recommending
content to users. RS enables these organizations to create better user experiences.
In all of these cases, there is an abundance of choice and heterogeneous user tastes.
The RS helps users find items they will like and thereby derive value from the media.
RS is a source of competitive advantage, and tech organizations invest heavily in
them. One famous example was the Netflix Prize (2006–2009), when they offered a
million-dollar prize for improving the accuracy of their RS by a certain amount
(Bennett & Lanning, 2007).
Prior to the Internet, media was sold to advertisers mostly through sales forces.
Technology companies like Overture (later bought by Yahoo) and Google AdWords
created a new way to sell advertising media through auctions, where advertisers
place bids to expose some user, informed by data. Advertisers use predictive
analytics to estimate the probability that the particular user will click, convert, etc.,
and the Balance Algorithm is used by platforms to allocate exposures to advertisers
(Leskovec et al., 2020; see Saurwein in this volume). These programmatic auctions
were originally developed for banner/display ads and search, but the approach is
spreading within the media (Busch, 2016). Some TV ad inventory, the last bastion of
traditional advertising, is now being sold through such auctions.
While there have been other algorithmic innovations that have substantially
changed certain industries (e.g., various deep learning neural network architectures
have made substantial improvements to image and voice processing), it is important
to understand that most of the algorithms are available to anyone in open-source
libraries. For example, anyone can access TensorFlow and PyTorch to build state-ofthe-art neural networks or LensKit and many other open-source recommendation
software. Algorithms are only as good as the data used to train them, and the real
competitive advantage comes through having better data. A company that knows
nothing about its consumers will not be able to make accurate predictions of needs
for personalization or targeting, even with the best algorithms. On the other hand, a
company with excellent data can do pretty well with even simple algorithms. RS and
media buying will become better as new sources of data become available, such as
additional contextual variables (Huh & Malthouse, 2020).
4.2.3
Disruptive Business Models
During the twentieth century, media was a canonical example of a two-sided market.
As mentioned in the introduction, media companies would attract an audience and
sell access to the audience to advertisers. Digital platforms have since emerged and
inserted themselves between consumers, media companies, and advertisers. For
example, at one time consumers would turn to a local newspaper for information
about local affairs, but now start their search for information with a Google search or
visit to Facebook or even YouTube. Google or Facebook then direct the consumer to
a media organization (e.g., newspaper) or advertiser and usually collect a tax for
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doing so. The platforms have become the first destination of users for many
information, entertainment, and social needs (Line et al., 2020).
Another example is Apple News. From the consumer’s point of view, news
organizations have not made it easy to pay for their content. As advertising revenues
have vanished, news organizations have been forced to construct pay walls to stay in
business. Consumers must subscribe to a news publication in order to read its
content, but consumers do not want to have dozens of subscriptions and subscribe
just to read a story. Rather than addressing consumer needs by creating micropayment systems or banding together to offer a bundled subscription service similar
to cable TV, news organizations have left it to technology companies like Apple to
devise consumer-friendly solutions. This is reminiscent of how they left it to Yahoo
and Google News to create news portals focused on the user experience with RS
covering thousands of news publications. Again, we see a technology company
inserting itself between a media company and the consumer by focusing on the user
experience, and the role of the traditional media company is diminished to only
content creation and not distribution of the stories themselves.
The disruption to news organizations is due to the democratization of content
creation as well as mechanisms to develop audiences interested in consuming and
amplifying the message for entertainment, political, and even societal disruptive
purposes. Not only has the news organization found technology companies to be
formidable, direct competitors from an audience and monetization perspective, but
the technology firms have enabled the audience itself to move from consumer to
competitor in content creation, distribution, and monetization arenas, even allowing
the consumer to easily monetize any audience they gather. Some of the more
controversial players have grown into large enterprises, finding audiences in the
tens of millions and creating content that is highly controversial and even harmful
while financially explosively successful, such as maliciously capitalizing on tragedies such as the Sandy Hook School Shooting (Vigdor, 2019).
4.3
4.3.1
How Do We Respond to This Data-Driven Disruption?
A Change Management Framework
Understanding the main barriers and levers to successful change in this dynamic
environment is critical. We have seen disruption driven by data and technology
upend markets and put companies with decades of high profits and tens of millions
of customers into bankruptcy (Eastman Kodak, Circuit City, Borders). What we do
as leaders in the face of this change could result in dramatically different outcomes.
Four areas that frame barriers and levers to change can be summarized as follows:
• People—Skills, experience, culture, structure, and team style
• Process—Workflow, interactions, methods, and timeframes
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• Data/Technology—Granularity, speed, quality, automation, and systems
• Incentives—Values, monetization, commissions, bonuses, and promotions
For example, a media company whose primary focus is traditional media (TV,
print, broadcast) may have an analytics team that is structured in large subgroups,
focused on audience segmentation and media performance measurement. The new
world will require dynamic content optimization, real-time bidding for audiences,
and machine learning algorithms embedded within a trading system for monetization. The necessary pivot for this company to go digital highlights challenges in all
areas, people, process, data, and technology as well as incentives, that have the
potential to resist or accelerate the change.
Let’s focus in on each of these critical areas and how they become the key to
success or the insurmountable barrier to change in the midst of this disruption.
4.3.2
People
Through education and experience, people develop skills that are useful to a
business. The well-practiced skills of the past and the new skills needed may overlap
in the disruption conceptually—so the education of the team may be relevant.
However, their experience on what works, where the risks are highest, and how
fast things can evolve was developed and refined in a world where data was not so
plentiful and the cost of technology more of a barrier. This experience can be
detrimental and needs updating with new, proven experiences under the disrupted
conditions.
Addressing the people challenge takes a focused strategy that includes the
development of new skills. But more than this, it takes new experiences, developed
in a supportive environment that allows for more risk-taking at a pace that may be
much faster than development projects of the past. It is possible that new talent with
more experience with IOT data or real-time systems is needed to seed the situation.
Talent from the outside, perhaps from a start-up culture or a technology firm more
advanced in the new world, will bring to the forefront both opportunities for change
and barriers to overcome.
Statisticians and data scientists are at a premium in this new environment.
(Walker, 2015) However, this next generation of data scientists is moving into
newly merged fields of computer science, software engineering, data management,
and analytics. These growing senior players are producing new industry driving
platforms and innovative applications. These skills are in high demand, but the
celebrity talent is merging multiple fields which used to be the domain of specialists.
The frameworks developed and the new ways to merge data, monetize the data
assets, and manage the privacy/governance complexity for the corporation require
multiple team players but also may produce a new class of leaders with these merged
areas of expertise.
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The culture of the team may include a relationship sales approach, including
celebrity photoshoots, red carpet events, sporting engagements, and golf outings
with clients. The new data availability may make it possible for a competitor to
capture long-standing clients with more analytical sales pitches that focus on economics, optimization, and performance over scale. The upskilling and reskilling of a
sales force to move from relationship to consultative selling (or vice versa) may be
more difficult than the technical training program development first indicates, as the
culture and style of the team may be deeply entrenched and resistant to change.
The organizational structure may be directly in the way of the change—and this
needs to be addressed quickly and early in the change process. It is likely that a
structure will have to include labs and an incubation component for new products,
new systems, and new applications to be safely developed. The ability of legacy
structures to suffocate a new digital team is well known. Also, the dispersion of new
talent thinly within a large organization can quickly result in the failure of the new to
take root and develop. Often, the new teams need separate space, leadership, and
direct reporting lines to the C-Suite to allow for sufficient support and protection
from the legacy culture.
Google is a great example of a dynamic approach to structures and layers that
both protect an acquisition upon entry and additionally create separate environments
for innovation and development of very different technologies and business models.
The acquisition of YouTube in 2006 (Schmidt & Rosenberg, 2014) was not a
onetime event that resulted in successful growth and integration. Over the course
of more than a decade, the teams were strategically managed including both integration and separation, infusion of talent into the larger Google sales teams as well as
development of specialized teams to focus on growing adoption and resultant
revenues. Upskilling and reskilling Google performance media sales teams to
consult with brand-focused agencies and creatives ultimately drove billions in new
revenue and is an excellent example of a successful, yet complex people challenge in
the midst of this new, data-driven media disruption. YouTube brought a different
culture to Google, including the attitude of saying yes, taking risks, and moving
faster.
People as a barrier/lever to change increases in importance as we focus our
examination on the leadership required to inspire, motivate, and make crucial
decisions on the journey. The leadership will likely need new skills quickly; they
will have experience gaps and may need to be replaced to advance the change.
Leaders who have no tactical knowledge with data-driven, intelligent decisioning
products may be at a substantial disadvantage and often lean on past experiences and
strengths that do not serve them well in the new world. The first change often needed
is not the data—it is in the mindset of the leadership team. And that may very well
require the acquisition of outside talent in key leadership roles to accelerate change
and reduce both obvious and subtle resistance.
Diversity is critical to success in change management as an accelerant (Page,
2017). The idea of teams mixed with different types of thinkers, some from within
the organization more receptive to new ideas, some from outside the organization
from different industries and technology experiences, creates a lift and often results
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in more dramatic breakthrough changes. Many of these changes require teams of
people with deep expertise in legacy technologies as well as team members with
growing knowledge in new or merged applications. Leaders who can navigate the
emotional and political turmoil of these teams as the old is deprecated or overcome
by the new, and sacred cows are sacrificed on the altar of change, tend to be the most
successful. Some of these challenges are shared by diverse and talented workers and
leaders as they experience the strong cultures of new companies like Google and
Facebook—where new technology quickly becomes legacy and rising new talent is
not supported by the leadership and culture instantiated only a decade ago (Orr,
2019). Most companies have decades of legacy to overcome as these disruptions
crash over their financial and technological foundations.
4.3.3
Process
The very process that underlies a business may need to change, including previously
held beliefs on how long it takes to develop a new application or system, how large
teams need to be to drive consensus, how decisions are made within the business,
how new product investment and flagship product deprecation decisions are made,
and how customer insights and satisfaction are gathered and utilized.
Some example processes that may not exist or may need to be completely updated
include:
•
•
•
•
•
•
•
•
•
New product development
Product lifecycle management
Data asset systems development
Data governance (privacy and regulatory compliance)
Content and marketing communications
Application development (agile adoption)
Competitive intelligence
Customer insights and market research
Performance evaluation
The above processes are examples that have impeded progress of adapting to the
new reality of the massive changes resulting from the explosion of data and
technology in our devices, media, and consumer/brand interactions. The legacy
processes and systems that were utilized historically did not envision the possibility
of real-time IOT data to provide information on customer usage of products or
extensive data on device location and consumer intent to purchase through interactions with media.
The old process may have been developed by anthropologists and social psychologists in prior decades including focus groups, in-depth interviews, participant
observation, and textual analysis. These studies may have been performed through
survey research to generate insights annually about segments of customers, changing
product needs and satisfaction with current offerings. It may seem obvious on the
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surface, but there are teams of people still performing this work, trying to adapt to a
new reality of data coming from tracking devices in the supply chain, location and
behavior data from mobile devices, IOT data on the products, and massive transactional data from POS systems and e-commerce. In many companies, the storage of
this new data, design of the capture and quality management, the meta-data associated with these data assets, and the privacy/governance are disparately managed and
not accessible by the very people now expected to take advantage of the new data
assets.
The structure and timing of these processes are often constrained by the past
methods, cost structures, and data availability. When developed from a clean slate,
the new processes are typically much faster, cheaper, more accurate, and
information-rich than previously dreamed possible. This is where the new division
or new company has an advantage and often runs circles around a larger, more wellfunded company attempting to change from the past to the new reality.
4.3.4
Data and Technology
The crux of this disruption is the changing data and technology possibilities in
addition to a flood of new data exhaust from devices and digital interactions between
brands and customers (see Langner & Klinke in this volume). Some of the changes
occurring in the data include just the size and scale (so-called big data), but it goes
well beyond size. The structure or lack of structure, unknown quality, real-time
sources, new data types, increased granularity, and fragmentation may all be new
with unknown complexity and transformation requirements (Huh & Malthouse,
2020).
The technology changes are also complex, not just exponentially faster and
cheaper but truly new, unforeseen applications generating new investment business
cases and resultant revenue streams. Those systems may be required due to customer
expectations set by market leaders in disruptive domains that were previously not
viewed as competitive. Example legacy technology systems that become resistors to
the new opportunities just by their existence and resultant inflexibility include CRM,
merchandizing, inventory, payroll, sales pipeline, email/communication, databases/
data marts/data warehouses/data lakes, billing, creative asset management, content
management systems, marketing, and financial systems.
New systems may be needed to manage the new data that include requirements
not easily met by the investments made just 2–5 years ago. The new system may be
required to meet both the needs of the prior generation of products while also
meeting the requirements of the new, data-rich, real-time digital products. The
consumer experience expectations may be set by a very well-financed new technology firm, like Facebook, Google, or Amazon, and difficult for a large company with
prior legacy systems to match. Expectations set by popular platforms with hundreds
of millions of users set a relentless pace of change with respect to the consumer
experience driven by data and technology.
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Examples of new systems that are required today to meet consumer expectations
include data-driven systems that create a much more relevant and intelligent customer experience, including intelligent content platforms, an intelligent RS, realtime bidding, location intelligence, digital asset creation and management, social
media marketing, real-time analytics, media optimization, home management, ad
infinitum. We must attempt progress to meet the requirements and capabilities of the
new systems while also keeping legacy systems operational. For most large existing
companies, the legacy systems and flagship products produce the funding to invest in
the new, data-driven, disruptive products.
Companies that survive and thrive in this rapidly changing environment develop
a strategy that includes planned deprecation, complete replacement, and the development of the new, more data-driven, intelligent systems. When acquiring a smaller
company with more advanced technology, knowledge of these requirements allows
us to build in the funding for the technology transformation as part of the acquisition’s financial plan, anticipating all aspects of the technology changes required
subsequent to the acquisition. It is not enough to acquire and create a portfolio of a
variety of technologies and expect to continue to grow and keep up, we must
integrate, deprecate, and establish a path for future change and growth with each
acquisition, each new product generation, and each new level of data-driven success
we achieve.
4.3.5
Incentives
An accelerant or drag on any change initiative can be your corporate incentives
where values are reinforced in a variety of both overt and more subtle ways.
Understanding how compensation, career advancement, recognition systems, and
the core values of the team are aligned (or not) with the new environment is a critical
success factor (see Koinig and Diehl in this volume).
Let’s take an example where base salary and promotion is established and grown
by total revenue, divided by product and region. New products may be growing at
rates much faster than more mature products. However, compensation may be 90%
or more weighted toward the performance of the mature products, with new product
performance almost immaterial to the compensation of sales, management, or
marketing leaders. This can be a critical problem limiting time spent with prospects
and clients in sales calls and negotiations to help new products gain traction.
A more subtle example is where the margins are significantly higher on mature
products vs. new products that have not yet reached full scale for efficiency and
profitability. Compensation systems where bonuses are tied to profitability for
management can get in the way of support and focus on new product growth.
Success with new product adoption and growth may degrade the profitability of a
division or region even as quotas are hit and balanced revenue targets achieved.
Some systems have historically rewarded senior managers with promotions and new
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levels of variable compensation, including stock options and equity positions which
can also be a more subtle disincentive to support and fund a change initiative.
At Google, an important change management challenge emerged between a
culture of performance media and brand building media across product, engineering,
and business development. The clash became visible in Google display vs. search
products. After YouTube was acquired this challenge grew and it became clear that
the budgets and tactics that would drive growth would come from the much larger
pool of brand advertising dollars managed by agencies. Overcoming this required
adjusting both the financial incentives and addressing the core values of the performance media culture. The value proposition of brand advertising spend is much less
clear due to a longer-term horizon on value creation than the CPC (cost per
conversion) focus of the performance media culture. Overcoming this challenge
required addressing more than the obvious financial incentive disparity of the larger
search ad sales engine, it also required education on the value of brand building, the
power of brand advertising, and even changing the whole idea of what constitutes
“performance media” in this new, data-driven consumer experience world (see Diehl
& Terlutter in this volume).
Disruption in the media marketplace is very evident in the financial incentives and
infuses every aspect of content creation and distribution. Engagement that results
from heightened fear, anger, and sensationalism is rewarded immediately with
virality, monetization potential, and an expectant, loyal audience base. Incentives
for factual reporting and accuracy are not rewarded in an immediate way, and
generations of credibility can be lost in a momentary misstep or a false narrative
amplified by narrow communities. Given these changes in incentives, the question of
how to build a sustainable organization, with credibility, integrity, and core values, is
paramount. And it is clear that without care, an organization could be created to
optimize audience, virality, and energy that is fundamentally corrupted by the
monetization incentives. The immaturity of this new structure might lead us to a
resultant change that was not intended and not positive for society.
4.4
Summary
This change management framework may seem far from the technical challenges of
adopting big data, new media technology, and intelligent data-driven systems.
However, obtaining and sustaining financial support for a change toward new
product lines, new ways of doing business, and even new markets requires an
examination of the incentive systems that guide the decision-making of senior
managers empowered to drive growth, profitability, and the financial health of an
organization. It is not enough to have a top-down decree drive a new strategy to
adopt, utilize, and sell new technologies in the market. It requires an alignment of
values and incentives, even an alignment on how a company creates value and serves
its customer base. These new data-driven products, devices, media tactics, and realtime systems disrupt much more than the direct system they might be replacing.
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The empowerment of the people charged with the change and processes relied
upon by the business will need to be re-examined. New skills, training in different
techniques, new project management paradigms like “agile,” essentially a whole
new world of ideas beyond the changes in the data sources themselves, will be
required to be successful. And the selection of new technologies may also require
examining old technologies, deprecating systems, rejuvenating systems with a larger
remit, and integrating prior silos in ways previously unanticipated.
However daunting the change management challenge for your business, both the
rewards for doing it right and the consequences of underestimating the resistance
categories are large enough to warrant the effort. This is an exciting time in the world
of big data, data-driven intelligent media, and data science.
4.5
Emerging Disruptive Data Factors
The second section identified factors that have already happened and which are
likely to continue into the future. This section attempts to identify emerging factors
that could become major factors in the future.
4.5.1
Regulation and Antitrust
Government regulation of data usage is increasing (see Mueller et al. in this volume).
For example, in 2018 the European Union enacted the General Data Protection
Regulation (GDPR) and India adopted similar laws in the same year. In 2020
California enacted its Consumer Privacy Act (CCPA). The effects of Cambridge
Analytica’s actions on Brexit and the 2016 US presidential elections prompted the
US Congress and the European Parliament to call on Facebook CEO Mark
Zuckerberg to testify about his organization’s data use policies, but it was not the
impetus for any new major legislation in the USA or UK. During the previous wave
of privacy legislation, advocates wanted stricter rules, but they didn’t get them,
making it more likely that they will try again with another wave. It is likely, or at
least conceivable, that there will be some future event involving the misuse or
nefarious use of data that mobilizes political action and that there will be another
wave of legislation passed. Another scenario is that there will be antitrust actions
against tech companies.
4.5.2
Data Ownership
As we have discussed, digital platforms provide some service to consumers in
exchange for consumer data and the ability to show ads. An important question is,
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who owns the data? The tacit assumption is currently that the organization that
gathers the data is the owner and may harvest value from it, possibly subject to
certain consent requirements that vary across countries. Now imagine a technology
that enables some consumer to record and compile her data—what she watches,
reads, browses, and buys, where she physically travels, what she has planned in her
calendar, what she writes to in texts and emails, and how she pays for different goods
and services. Such data have clear value to advertisers, and suppose that there was a
way for our consumer to receive value from sharing her data.
In addition to such a data-ownership service, there may be a need for laws to
regulate data ownership. In the past it has not been possible to record such a
comprehensive view of a consumer, and therefore there was no need to regulate
something that did not exist. Now that such a record is possible, regulation may be
necessary. An analogous situation happened in the 1890s (Greene, 2017; Spears,
2008). Prior to this time it was impossible to capture and use a person’s image
without her consent. New photography technology created the possibility to share an
image, and soon after there was a case that questioned who owned one’s image. A
beautiful teenage girl (Abigail Roberson) sat for photograph by a photographer. The
photographer sold the image to the Franklin Mills flour company, which used the
image in their advertising with the headline, “Flour of the family.” Roberson sued
Franklin Mills for using her image without her permission, and the case was decided
by the New York State Supreme Court. The court ruled against Roberson, claiming
that there were no laws on the “right to privacy.” During the next year, state
legislatures passed laws that recognized an individual’s right to control his/her
physical likeness and name (see Hattenberger & Vidreis in this volume). Today,
celebrities commonly receive payments from advertisers to use their name or image.
We see a parallel situation with data. Data ownership issues are discussed more
completely in Line et al. (2020).
4.5.3
Security, Data Breaches, and Risk
Creating value from customer data can have challenges. The first challenge is that
there are risks associated with storing data. Data breaches at large companies such as
Adobe, Adult Friend Finder, LinkedIn, Marriott, eBay, and Equifax have cost them
millions of dollars, and executives have lost their jobs. In fact, the average total cost
for a data breach worldwide is $3.86 million and $8.64 million in the USA
(Ponemon, 2020). The cost of data breaches and their magnitude will only increase.
Friction is another concern. Deriving value from data requires for firms to share it
with professional service providers, such as data science or marketing research
consulting firms. It is becoming more difficult to share data because of legal issues
where corporate lawyers are involved and risks with sharing the data. Service
providers now must be certified for data security, e.g., ISO 270001, and may have
to carry additional “cyber insurance.” These requirements add friction to the relationship, which increases cost of realizing value from data.
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4.5.4
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New AI Applications and Potential Backlash
The number of new AI applications will continue to grow exponentially, including
applications in transportation, healthcare, home security, financial services, commerce, technology, and education. Given this expansion of the use of technology to
handle very large data sources and make automated decisions for us as consumers
and patients, we can expect a new level of backlash and regulation. It is entirely
possible that AI systems and the data driving them cross a line and gain more
governmental attention through financial harm, privacy violations, or personal injury
(real or perceived). The creepiness of a suggestion regarding a product or service
may cause regulation or prohibition of certain use cases. Note that the use of location
data, health data (from a smart watch or fitness tracker), and online behavior data
continues to expand. While these AI systems may save lives, they may also gain a
large advocacy group for regulation and limitations as they continue to cross
boundaries or privacy with data gathered and the risk of error in the far-reaching
applications.
For example, we are seeing the use of previously private location data and AI to
help predict epidemic outbreaks as well as non-cooperation with government lockdown orders. As it becomes more obvious that this is possible with existing data and
technology which crosses geographic borders, we can expect regional sensitivities
that drove regulation like GDPR to once again arise and attempt to restrict the use of
this data. Even when the applications initially designed are acceptable, the subsequent use cases and parties designing new applications may not stay within the same
legal and/or ethical boundaries.
4.6
Conclusion and Future Outlook
While digital media and big data have disrupted business models and created new
challenges with privacy, ultra-extreme media sites, deep fakes, and a concentration
of power among few tech companies (see Voci & Karmasin in this volume), we
believe that advances in digital media and the data they generate do more good than
harm. Every problem is eligible for a data-driven solution. We write this chapter
during the Covid-19 pandemic and have hope that data and mobile technology will
play a role in resuming normal life. For example, mobile location data can be used to
measure areas where social distancing is not being adhered to and connected wearables with thermometers can help identify the next places where the virus is
spreading. Mobile data could help trace people who have been in close proximity
to an infected person. There are numerous other problems where data and digital
technology can provide a partial solution. It will be possible to combine data sets to
solve problems in ways that we have not thought of in the past.
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4.7
G. A. Green and E. C. Malthouse
Exercise and Reflexive Questions
Select a media company to study.
1. Make a list of all digital devices that media company supports. Note how users
access the devices. Does the media company require a log in? Does it offer a
branded app or tool bar, or do consumers access the media through a browser?
2. Identify what data the company could reasonably measure on its users. What firstparty data might it collect, including media behaviors?
3. How is the data used by the media company to create a better user experience and
increase loyalty? Does the company create personalized experience for its users
with the data?
4. Does the media company monetize the data in other ways, such as selling the
information to advertisers or using the information to better target ads (without
turning it over to the advertiser)?
5. What other data sets should the media organization seek out through partnerships
or acquisitions to enhance the value of its data? Are there opportunities to enter
other categories because of the data it collects?
References
Abdollahpouri, H., Malthouse, E. C., Konstan, J. A., Mobasher, B., & Gilbert, J. (2021, April).
Toward the next generation of news recommender systems. In Companion proceedings of the
web conference 2021 (pp. 402–406).
Abernathy, P. M. (2018). The expanding news desert. In Center for Innovation and Sustainability in
local media. University of North Carolina at Chapel Hill.
Adomavicius, G., & Tuzhilin, A. (2011). Context-aware recommender systems. In F. Ricci,
B. Shapira, L. Rokach, & P. B. Kantor (Eds.), Recommender systems handbook
(pp. 217–253). Springer.
Bennett, J., & Lanning, S. (2007, August). The netflix prize. In Proceedings of KDD cup and
workshop (p. 35).
Busch, O. (2016). Programmatic advertising (Vol. 10, pp. 978–973). Springer.
Ekstrand, M. D., Riedl, J. T., & Konstan, J. A. (2011). Collaborative filtering recommender
systems. Foundations and Trends® in Human–Computer Interaction, 4(2), 81–173.
Greene, J. K. (2017). The resuscitation of normative privacy. The Journal of Value Inquiry, 51(3),
383–395.
Hennig-Thurau, T., Malthouse, E. C., Friege, C., Gensler, S., Lobschat, L., Rangaswamy, A., &
Skiera, B. (2010). The impact of new media on customer relationships. Journal of Service
Research, 13(3), 311–330.
Hofacker, C. F., Malthouse, E. C., & Sultan, F. (2016). Big data and consumer behavior: Imminent
opportunities. Journal of Consumer Marketing, 33(2), 89–97.
Huh, J., & Malthouse, E. C. (2020). Advancing computational advertising: Conceptualization of the
field and future directions. Journal of Advertising, 49(4), 367–376.
Leskovec, J., Rajaraman, A., & Ullman, J. D. (2020). Mining of massive data sets. University Press.
Line, N. D., Dogru, T., El-Manstrly, D., Buoye, A., Malthouse, E., & Kandampully, J. (2020).
Control, use and ownership of big data: A reciprocal view of customer big data value in the
hospitality and tourism industry. Tourism Management, 80, 104106.
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Malthouse, E. C., Buoye, A., Line, N., El-Manstrly, D., Dogru, T., & Kandampully, J. (2019).
Beyond reciprocal: The role of platforms in diffusing data value across multiple stakeholders.
Journal of Service Management, 30(4), 507–518.
Malthouse, E. C., Maslowska, E., & Franks, J. U. (2018). The role of big data in programmatic tv
advertising. In Advances in advertising research IX (pp. 29–42). Springer Gabler.
Malthouse, E. C., & Li, H. (2017). Opportunities for and pitfalls of using big data in advertising
research. Journal of Advertising, 46(2), 227–235.
Mortimer, J. H., Nosko, C., & Sorensen, A. (2012). Supply responses to digital distribution:
Recorded music and live performances. Information Economics and Policy, 24(1), 3–14.
Orr, M. (2019). Lean out: The truth about women. Power and the Workplace.
Page, S. (2017). The diversity bonus: How great teams payoff in the knowledge economy. Press.
Ponemon Institute. (2020). 2020 Cost of a Data Breach Study: Global Overview, Ponemon
Institute. https://www.ibm.com/security/data-breach.
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New York Times. https://www.nytimes.com/2019/12/31/us/Alex-Jones-sandy-hook.html
Yun, J. T., Segijn, C. M., Pearson, S., Malthouse, E. C., Konstan, J. A., & Shankar, V. (2020).
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Greg Green is an adjunct lecturer in Medill’s Integrated Marketing Communications program. Green has more than 30 years
experience in analytics with digital media and content marketing
focus areas. Highlights include product development and sales
optimization as a director at Google, global head of analytics at
Digitas (a Publicis Groupe digital advertising agency), and currently chief data and analytics officer at Harland Clarke Holdings.
Green is a sought-after speaker in marketing analytics, bringing a
passion to create value from disparate sources of unstructured data
and a willingness to push the limits of analytical innovation. For
further information, please see https://www.medill.northwestern.
edu/directory/faculty/greg-green.html.
Edward Malthouse is the Erastus Otis Haven professor of integrated marketing communications and industrial engineering in
the Medill and McCormick schools at Northwestern University.
He is the research director of the Spiegel Research Center on
Digital and Database Marketing at Northwestern, an incoming
co-editor of the Journal of Service Research, and former editor
of the Journal of Interactive Marketing. His research interests
center on customer engagement and experiences; digital, social,
and mobile media; recommender systems; customer relationship
management and lifetime value models; predictive analytics;
unsupervised learning; and integrated marketing communications.
For further information, please see https://www.medill.northwest
ern.edu/directory/faculty/edward-c-malthouse.html.
Chapter 5
Controlling and Change Management
Gernot Moedritscher and Friederike Wall
Abstract In recent years, controlling has increasingly established itself in the role as
business partner. The support of executives in making necessary decisions within the
company is the main focus of interest combined with coordination among decisionmakers at several levels. An extensive and complex field of decision-making arises
for executives in the area of change management. In this article, we discuss the role
of controlling, change management and strategic change. Excerpts of instruments are
presented on how controllers can support management in the course of strategy
processes in particular with respect to strategic and organisational changes. We also
reflect on the need to pay special attention to the development of competencies in
controlling not only in relation to business knowledge but also to communication
skills and the ability to ask critical questions.
5.1
Introduction
It is only in the recent past that controlling has succeeded in moving away from a role
of searching for deviations in numbers and moving instead into a role of controlling
and supporting. Although support in steering the company has always been
intended, in business practice it has taken quite a long time for the role of business
partner to become more firmly established. It can be observed that change management processes in particular are increasingly being designed and accompanied by
controlling.
G. Moedritscher (*) · F. Wall
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: gernot.moedritscher@aau.at; friederike.wall@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_5
73
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5.2
G. Moedritscher and F. Wall
Controllers’ Role: From Accountants to Business
Partners
To discuss the connection between controlling and change management in more
detail, we will first take a closer look at the lines of development in management and
controlling. First, of particular interest is the way in which aspects of the behaviour
of managers have come to the fore in the past. In the middle of the twentieth century,
the concept of behavioural sciences developed into a catchword in the field of
organisational theory with a focus on human behaviour and assigned to the social
sciences (Staehle et al., 2014). The needs and the conflict between the individual and
the organisation were discussed intensively at that time. The employees, who were
considered as an essential factor of an organisation, were also referred to as human
resources, from which the concept of Human Resources Management developed in
due course. Together with organisational development, a very practice-oriented
approach of research on organisational behaviour emerged (Pieper, 1988).
Besides the development of behavioural sciences in the 1970s, management
accounting became established as a key element in organisational decision-making
and control processes (Alsharari, 2019). In German-speaking countries, where the
term controlling is used for what in the Anglo-American countries is often
summarised as management accounting and control (Binder & Schaffer, 2005),
there is a strong community that subscribes to that approach. Strategic controlling
focusses on strategic analysis, strategic planning and strategic performance management. The range of opinions about the meaning of controlling is very broad and
widely discussed (Weber & Schäffer, 2008). First, the predominant function of
controlling is to generate and supply information to decision-makers which these
may use for decision-making (controlling as information supply). In this sense,
controlling is primarily founded on accounting and takes the role of a service
function. As such, controlling is about affecting managerial decisions only by
generating and selecting information (Reichmann et al., 2017). Second, and in a
broader sense, controlling can also be seen as coordination of planning, monitoring
and information supply. Controlling then has to coordinate among the key tasks of
management meaning planning, monitoring and information supply and the related
subsystems (Horváth, 1978). Controlling is supposed to coordinate departmental
decisions with a view on the overall profitability objective of the firm. Decisionmaking is, at least to some extent, decentralised and, therefore, there is a need for
such coordination. Controlling tries to ensure that the decentralised decisions of
departmental managers are coordinated, aligned and integrated and it therefore
contributes to the objectives of the firm. Controlling focusses on the structure of
the firm’s planning system, monitoring system and information system that have to
be established (system-generating), and controlling has to react to day-to-day
unforeseen events (system-aligning). Therefore, controlling is not directed towards
the coordination of operational activities but towards coordination within decisionmaking. Third, with controlling seen as a comprehensive coordination of management, the coordinative function of controlling is emphasised, too, while the scope of
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75
the coordination function is extended. Additionally to planning, monitoring and
information supply, organisation and human resources are also to be coordinated,
and, with this in particular, behavioural control receives growing attention (Küpper
et al., 2013). In this sense, controlling is supposed to contribute to the design of
incentive systems by proposing the appropriate assessment basis for management
compensation. Furthermore, controlling is about assuring the rationality of management (Schäffer & Weber, 2014). This approach focusses on the interaction of
economic and behavioural aspects of management. As part of its supplementary
function, controlling should compensate certain skill deficits and mitigate opportunistic behaviour of managers due to its specific methodological knowledge. Overall,
in recent years, research has shown that companies expect controlling to be a
business partner supporting both, operational and strategic decision-making (Fourné
et al., 2018; Mödritscher & Wall, 2017).
As a linkage between behavioural sciences and management accounting the first
contingency-based research studies were carried out in the 1970s, which focussed on
budgeting and the use of budgets. In further consequence the focus has shifted to
more qualitative factors (Otley, 2016). Newer instruments, such as activity-based
costing, have come to the fore of interest as well as the question of how management
accounting supports decisions in a better way. Finally, management accounting has
continued to develop further towards strategic management accounting. It can be
observed that management accounting has evolved in terms of its tasks and tools.
This is caused by changing questions, which needed to be answered with the support
of controlling (Alsharari, 2019).
5.3
5.3.1
Controllers’ Role in Strategic Change
Change Management
Companies are increasingly determined by change—be this, for example, to meet
heterogeneous and dynamic preferences of customers, to adapt to emerging technologies or to cope with global challenges. In order to manage changes, a variety of
management techniques can be employed, which can be summarised as change
management. The basic intention of change management is to achieve the best
possible development from the starting point to the goal (Lauer, 2010). In order to
meet the requirements of change in companies, the original approach of corporate
development was further developed into a more holistic approach (Doppler &
Lauterburg, 2002). Therefore, change management includes all measures that are
necessary to initiate and implement new strategies, structures, systems and behaviours. As a consequence, change management means planning, initiating, realising,
reflecting and stabilising change processes on a corporate and personal level
(Gattermeyer & Al-Ani, 2001). Organisational development focusses primarily on
social processes. It encompasses many ideas regarding the implementation of
changes that originate from the social sciences. Furthermore, transformation
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G. Moedritscher and F. Wall
management describes changes that affect people and companies at their core. It is
about profound changes that require a fundamental transformation of the identity of
the company (Loebbert, 2014).
In general, we encounter typical reaction patterns during change (Kostka &
Mönch, 2009; Kotter, 2012; Streich, 2016). In a first step, triggers are personified,
i.e. responsible scapegoats are sought and declared guilty. This is followed by the
phases of ignorance and repression. Problems are played down and necessary
solutions are postponed indefinitely. Only in the often painful and conflict-laden
phase of confrontation and thus of highest attention does the pressure increase to face
the situation and to accept it. This phase provides the necessary concern and
willingness to think about possible solutions and measures. If this phase ends in
conscious reflection, the potential for problem-solving and the maturity to deal with
similar situations in the future increases.
Lewin developed a classic model for managing change (Burnes, 2004; Lewin,
1947). The approach comprises the phases of unfreezing, moving, changing and
refreezing. In the unfreezing phase, all those persons involved need to be convinced
of the change. In order to create a readiness for change, existing attitudes and
behaviours must be thawed. Phase two of the change process aims to redesign the
original state. In the final phase of re-freezing, the achieved state should be stabilised
in the long term. The model includes the consideration that in every change there are
forces at work that drive or hinder it. For the continued existence of a company, there
must be a fundamental balance between both forces. In the event of forces that
impede change, necessary changes fail due to resistance. If, however, an existing
state of equilibrium is to be abandoned for a new one, i.e. a company exposes itself to
deliberate change, the existing balance of forces must first be changed and stabilised
at the desired level (Vahs, 2009).
Doppler and Lauterburg furthermore describe important success factors for a
change process in organisations (Doppler & Lauterburg, 2002):
•
•
•
•
•
•
•
•
•
•
Clear and plausible goals including reasons
Correct selection of key people
Turning affected persons into participants
Realistic time planning
Good preparation and “kick-off” phase
Treat favourite ideas openly and first
Prudent and flexible process control
Constructively meeting resistance
Open handling of conflicts
Lively communication and open information
For a professional and successful implementation of changes, these are designed
in phases. According to Gölzner and Schmoll (2014), in the first phase, the need for
change has to be recognised and the initiative needs to be taken. Questions arise,
e.g. the need for change per se, what needs to be changed, and what is the willingness
and ability of the affected employees? In the second phase, the diagnosis and
orientation of the change project must be established. The aim of the diagnosis is
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77
to record the current situation in order to obtain a representative result from all
perspectives of the organisation. The third phase includes the planning and implementation of interventions. This involves planned, structured and targeted measures
to achieve the desired target state. Every intervention is risky because the impact of
individual measures can never be predicted exactly. Therefore, targeted interventions are necessary, which absolutely requires a diagnosis in advance. In the fourth
and last phase, the project is evaluated and completed (Gölzner & Schmoll, 2014).
5.3.2
Strategic Change
Controlling is increasingly taking on the role of a business partner in the implementation of corporate strategy (Mödritscher & Wall, 2017). This means that controlling
not only has to operationalise goals and translate them into control and incentive
systems, it must also provide appropriate communication support for the entire
strategy process. Often, this is an in-depth change process that also encompasses
the structure and culture within the company.
Strategy work in companies has become much more intensive and professional
over the past decades. The media sector appears to be particularly affected here.
Technological developments and changes in economic realities and society disrupt
current routines of, e.g. the news media industry (Kosterich, 2019). The contribution
of controlling to strategy work becomes increasingly obvious. It strives for an
increased quantification of goals, for more intensive coordination in the development
and evaluation of strategic alternatives and for the provision of solid databases and
decision-making instruments. However, the demands on planning processes continue to grow, especially since traditional strategic patterns no longer seem to work
under the current conditions as they are, for example, shaped by digitisation
(e.g. Scheer 2018). The achievement of further growth, the innovation of business
models and changing structures for value creation therefore characterise strategy
work today (see Schwarz & Gustafsson in this volume), so that different approaches
are also required in strategy development. In addition, the demands on management
concepts that support successful strategy implementation are increasing. Furthermore, they have to cover aspects such as innovation, sustainability, etc. and support
management in making timely and well-founded decisions. And finally, strategy
work must also make it possible to reflect on—and eventually question—the fundamental business model of the company (Wirtz, 2011). This, in turn, can entail
far-reaching cuts in the current business model, which is why risk management must
also be geared towards this possibility. The whole organisation is therefore affected
by changes in strategy work. It is essential that members of an organisation are all
informed about changes at an early stage and that they all support them (Doppler &
Lauterburg, 2014).
However, although the real rate of failure in strategy implementation is difficult to
determine, numerous empirical findings point to the fact that strategy implementation in particular continues to pose considerable difficulties and that the rate of
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G. Moedritscher and F. Wall
implementation failure is high (Cândido & Santos, 2015). Especially the lack of
communication of the strategy seems to be a basic problem in various facets. It leads
to inconsistent attempts at strategy implementation and leaves any existing suitable
control systems, such as a balanced scorecard, unused (Gaiser & Wunder, 2004).
Controllers have recognised this problem. According to empirical findings, they
would like to see even greater involvement in early planning phases, an even better
information situation, more extensive control of qualitative goals and more consistent measurement of the success of strategies (Schäffer et al., 2012). Their motives
are probably to be found in the ever louder call for greater consideration to be given
to behavioural control that is beneficial to the company and based on rational
decision-making, compliance considerations and the inclusion of other stakeholder
interests within the framework of sustainable corporate planning and control (see
Schwarz & Gustafsson and Koinig et al. in this volume). The aim is to correspond to
the changing role model of the controller towards a business partner with extensive
advisory function and responsibility for processes (Goretzki & Weber, 2012) and to
move from a navigator to a co-pilot (Schäffer & Weber, 2013).
Resistance is a normal side effect of any development process (Mödritscher &
Liebhart, 2005). Changes and learning usually cause resistance in everyday life. Due
to resistance, however, management is forced to pause, to think, to communicate or
even to correct the existing course. Resistance is often ignored or downplayed due to
lack of time. But for the success of any change project, it is of high importance that
any resistance is recognised promptly and reacted to correctly. Otherwise this will
lead to delays, blockages or failure. Forms of resistance are understood as the
emergence of barriers to innovation. Resistance can emerge as being active or
passive, destructive or constructive, direct or indirect, loyal or opportunistic
(Hauschildt & Salomo, 2011). Furthermore, resistance can occur on three levels of
the organisation, namely, on an individual level, on a group level and on the
organisational level:
– Individual level: At this level, the classical barriers of not knowing, not being able
to know and not wanting to do something come into play (Witte, 1973).
– Group level: The phenomenon of “groupthink” (Hauschildt & Salomo, 2011)
shows that groups tend to strive for unanimity under certain conditions of a
provocative context (e.g. high stress), structural deficiencies (such as isolation
of the group within the organisation) and high group cohesion. This can lead to
overestimation of self, stubbornness and terror of attitudes in interaction with the
environment.
– Organisational level: At the organisational level, structure, strategy and culture
set the context for the degree of innovativeness of the organisation. A higher
degree of formalisation and centralisation reduces flexibility and openness, prevents new ideas and innovative behaviour and ultimately forms a barrier to action
(Rüggeberg, 2009).
As diverse as the causes and manifestations of resistance within processes of
strategy development and implementation can be, as diverse are the starting points
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79
for reducing resistance, as we will show in the next chapter. We put particular
emphasis on the actions controllers may take.
5.4
Controllers’ Toolset for Strategy Processes
In the course of change processes, the approaches of consciously controlling this
process and overcoming individual resistance have developed considerably. For a
long time, particular importance has been attached to the individual involvement of
those potentially affected by the changes. In this sense, these individuals could be
involved by contributing their knowledge to the process and at the same time
receiving information on the progress of the process. Hamel even speaks of a
democratisation of the strategy process in this context (Hamel, 1996). Timely
participation in the creative process of strategy development and in the decisionmaking process (Böhnisch, 1979) can also counter the peril that the strategy will not
be implemented later.
In addition to involvement in the process and the induction of permanent learning
processes, it is also important to develop concrete individual targets (Schreyögg &
Koch, 2007). Methodologically, strategy processes can be supported above all by
strategy maps and the balanced scorecard (Kaplan & Norton, 2001) by illustrating
cause-effect relationships in the areas of finance, customer/market, processes and
potential. Furthermore, this can offer a starting point for reducing resistance in this
process:
– Goal setting and information about it can be made transparent.
– The interaction of objectives and the effect of measures in context becomes
visible.
– The meaningfulness of changes in potentials (e.g. competence structures) and
processes becomes clear and comprehensible.
– The (individual) communication of managers can refer to concrete contents.
The operationalisation of goals is then in turn a starting point for the development
of individual goals, which can be individually concretised in the course of appraisal
interviews. In addition to the processes of target setting and operationalisation, the
design of incentive systems, the quantification of target and strategy effects as well
as the provision of databases with individualised communication and presentation of
information are also examples of how to overcome resistance. The following
approaches can be helpful, depending on the cause of these resistances:
• Resistance due to lack of knowledge about the changes
–
–
–
–
Early involvement in the process
Opening the process to many internal (and external) stakeholders
Operationalisation and visualisation of goals
etc.
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G. Moedritscher and F. Wall
• Resistance due to lack of understanding of the changes
–
–
–
–
–
–
–
Education of the addressees
Establishing permanent learning processes
Operationalisation and visualisation of goals
Individualisation of goals in the appraisal interview
Establishing platforms for discussion of the topic, meetings, etc.
Ongoing interface discussions
etc.
• Resistance due to lack of ability to cope with change
– Development of a competence model and education and training measures on
the basis of the appraisal interview
– Individualisation of goals
– Early involvement in the process
– Promotion of promoters
– Making the first successes visible through the change
– Role model effect of leadership
– etc.
The approaches presented are not to be understood as individual measures, but
should be designed and implemented in the sense of an integrative programme of
measures to reduce resistance at an early stage. They should also be integrated
accordingly into the group-related and organisational framework concepts. In
order for controlling to successfully fulfil its role within the strategy processes, it
is necessary for the company’s managers to adapt the strategy development processes and to integrate the information and instruments provided even further into
the strategic management processes. Above all, this requires a high level of communication work by the controlling department.
The quantified goals defined in the course of the strategy process must be
communicated in a comprehensible manner and must be bindingly anchored in the
company in order to ensure that all those involved or affected are committed to their
implementation (communication of goals and results). Above all, the strategic goals
should be anchored in the management systems and linked to financial management.
Coordinated and concerted action within the organisation depends largely on the
information available and on the exchange of information. Accordingly, controlling
should also attach importance to the design of communication structures and systems
(Küpper et al., 2013). The following approaches are conceivable in this field:
– Medium-term planning with scenarios: This is a proven link between long-term
strategic planning and the annual budget. Annual budgets are prepared in the
sense of rolling planning. Medium-term planning (usually 3 to 4 years) should
provide the frame of reference for the annual budgets that translates the strategic
goals into quantitative figures. In the course of annual budgeting, which also
includes strategic projects, it is implicitly necessary to refer back to the strategic
goals, so that they are also constantly being discussed. Medium-term planning
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should in turn be based on a clear value driver hierarchy, in which the relationships between the value-determining elements of the strategy are presented and
thus communicated. The planning and decision-making processes can also be
supported by the development of scenarios that anticipate possible future contextual conditions.
– Management of the project portfolio: Experience shows that it makes sense to
develop a system for prioritising the project portfolio in the course of strategy
implementation (Greiner, 2018). Strategy development is hardly conceivable
without subsequent projects or change management. In such a project portfolio,
it is first and foremost a matter of communicating goals and actions to all affected
areas of the company and synchronising them. Ongoing reporting and control
processes in the project portfolio can also help to implement the strategy in the
departments as synchronously as possible.
– Definition of individual target contributions: Strategic goals can also be communicated by agreeing on targets for managers and setting appropriate incentives.
The determination and evaluation of individual target contributions by employees
in appraisal interviews on the basis of comprehensible indicators and measures
also provides an opportunity for this.
– Recipient-oriented reporting: Here, it is particularly important to communicate to
the addressees in an adequate and conclusive form what contribution they should
make to the achievement of a strategic goal. The results achieved during the
implementation of the strategy should be communicated promptly to the areas
involved so that corrective measures can be taken and a shift to other scenarios
that may have been developed in the course of the strategy can be initiated.
One of the reasons for the weaknesses in the communication of strategies can be
assumed to be that in most companies the strategy is developed by a comparatively
small group of people—usually top management and middle management—but
implemented by others in the organisation. This leads to considerable hurdles
when entering the strategy process and, later on, in the implementation of a strategy.
Although it can be argued here that middle-level managers have the task of passing
on the relevant information to the respective areas and thus fostering commitment for
the new strategy, this is probably only rudimentary in many companies. If one
understands controlling as an essential carrier of the strategy process, then one
must also undertake concrete considerations for the design of the strategy process
and thus accept process responsibility. The long-standing claim of organisational
development to turn those affected into participants still causes problems in the
concrete implementation (Weber, 2017). Although strategies in companies are often
developed in workshops, in which those affected from the individual areas can also
participate and which are held on specific topics, with changing personnel and in a
mostly predetermined sequence, it is also virtually impossible to avoid communication and information breaks. In order to remedy this situation, the integration of
methods of large group moderation offers itself in two ways. On the one hand,
communication in the strategy process can be shortened and intensified considerably, and on the other hand, the individual steps for developing the strategy content
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G. Moedritscher and F. Wall
can be made more efficient and effective. Most of the large group methods available
today were developed in the mid-1980s in the USA in response to the rapid changes
in contextual conditions (Bonsen, 2003). They promised rapid change in organisations by pragmatic means. Large groups are events involving between 30 and even
up to 2000 people working on a specific topic. A change in working methods
between small groups and plenary sessions makes direct contact between
the individual participants possible even in such large groups (Weber, 2002). The
professional roles, functions and positions of the individual participants are in the
foreground. The participants can change, the position as well as function and the
perspective resulting from it remain. Communication in a large group is ultimately
about the common organisation, which is supported by each individual. Such events
usually serve to change an organisation (Seliger, 2011). The communication patterns
of an organisation (structure of the organisation, rules of the game, formal reporting
channels, informal news channels, action patterns, meeting culture) ultimately
determine the way in which decisions are made and the consequences they have.
Making the communication patterns visible contributes considerably to changing
them. The collective decision-making processes lead to expect a stronger commitment of the participants to the results (Bonsen, 2003). The challenge in the use of
large groups lies in their integration into the overall process, in the moderation of the
large group (focus, mood, mass psychological phenomena) and in dealing with
exaggerated expectations. Methods of large group facilitation include Open Space,
Real-Time Strategic Change and World Café (Seliger, 2011). Controlling will rarely
take over the moderation of such a large group, but it can help to ensure that the
relevant information in this process is made available in advance or at least “just in
time” and that the results are binding.
5.5
Conclusion and Future Outlook
Controllers today like to present themselves or their department within companies as
business partners (Weißenberger et al., 2012). This role, which goes beyond the
classic understanding of controlling as a coordinator of planning, as a method and
system service provider or as an “economic conscience”, entails an expansion of the
tasks for controlling in the direction of strategic planning, organisation, processes,
etc. (Erhart et al., 2017; Schäffer & Brückner, 2019). Thanks to the highly developed
data processing systems in controlling and the growing experience of the controllers
themselves, they appear to be increasingly able to fulfil their new role as business
consultants. Communication between controlling and management is of critical
importance for fulfilling this role. It is therefore important to pay special attention
to the development of competencies in controlling, not only to business knowledge
but also to communication skills and the ability to critically question (Weißenberger
et al., 2012).
5
Controlling and Change Management
5.6
83
Exercise and Reflexive Questions
1.
2.
3.
4.
5.
What are the main tasks in controlling?
Which phases do change processes in the company typically go through?
What causes resistance in the company?
What role can controlling play in change management?
Which instruments are available to controlling in the course of supporting change
management?
6. What competencies should controllers have with regard to supporting change
processes?
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Gernot Moedritscher is Assoc. Professor at the Department of
Controlling and Strategic Management, Alpen-Adria-Universität
Klagenfurt, Austria, and also Vice Dean at the Faculty of Management and Economics, Universität Klagenfurt, https://www.
aau.at/unternehmensfuehrung/controlling-und-strategischeunternehmensfuehrung/team/moedritscher-gernot/.
Friederike Wall is Full Professor and Head of the Department of
Controlling and Strategic Management, Alpen-Adria-Universität
Klagenfurt, Austria, and also Vice Rector for Research of the
Universität
Klagenfurt,
Austria,
https://www.aau.at/
unternehmensfuehrung/controlling-und-strategischeunternehmensfuehrung/team/wall-friederike/.
Chapter 6
Change Management in Human Resources
Volker Stein
Abstract Reflecting the importance of change management in HR is an exciting
challenge. For future-oriented organizations, change management is usually the
anchor point and HR provides the instrumental support. This chapter takes the
exact opposite viewpoint in approaching the subject. Here HR is the institutional
context in which change management is located; this is done in two ways: First, the
interface between change management and HR will be considered, where change
management should follow the rationality of HR. Second, some recent general
business trends HR is exposed to will be presented, and the ways in which these
trends are likely to affect change management will be discussed. The chapter finally
subsumes these conceptual ideas under a more abstract dynamization framework.
6.1
Introduction
This book chapter hardly seems the place to tell readers everything there is to know
about change management in general. After all, reading the same stuff again and
again does not sound like a very compelling endeavor. Therefore, I will concentrate
on some specifics with regard to the intersection of change management and HR as
well as on some recent trends that influence HR and the subsequent change management within that realm. Let’s get started—in medias res!
6.2
When Change Management and HR Collide
There is a wide range of interface topics in which HR plays a substantial role in
change management and, from its point of view, provides helpful support or pushes
personnel management-related requirements to be met, as the new situation affects
V. Stein (*)
University of Siegen, Siegen, Germany
e-mail: volker.stein@uni-siegen.de
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_6
87
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V. Stein
basic HR policy. Three of the most prominent of these topics will be highlighted
below.
6.2.1
Challenges to Personnel Development from
Organizational Development
Organizational development normally implies change management. The central
driver for organizational development is usually the strategy or, more precisely,
the intended change of strategy. Change management acts as the transmission belt
for implementing this change in strategy within the organization. Consequently, the
changes do not stop with the strategy. Change management projects also change the
structures of cooperation, both within the company and regarding external cooperation. One step further, this affects the processes of collaboration.
When these predominantly mechanistic shifts start to have an impact, the real
challenge is only just beginning. The changes made have an effect on virtually every
other aspect of the company, but usually, it is not sufficiently planned or kept in
mind. What about the consequences of changed target systems that require a
different logic of action? What about corporate culture? What about new people
joining the work processes, influencing the social contexts, individual wishes,
expectations, satisfaction, identities, cultures, and even such things like the “sense
of [corporate] home?” What about the long-term prospects when the actual change
management project is finished? Is everything really settled after the “mission
accomplished?” Probably not—for example, long-term development prospects of
the company also influence individual long-term career plans. What about knowledge management? Knowledge is passed on in established structures and processes;
if they are changed, knowledge management and, in the end, the whole system of
organizational learning must be adjusted accordingly.
This is the point where HR comes into play again—after all, HR is the function
that ultimately brings all personal and personnel issues (“people issues”) together.
One prominent intersectional field is personnel development and training. To ensure
a smooth transition in this area as well, the people involved in change management
must be sensitized and prepared to deal with personnel development issues in three
respects:
1. Short-term collective cultural personnel development: HR needs to prepare the
players taking part in change management to ensure that they know that there is
much more to tackle in addition to strategy, structure, and process and that
handling these secondary aspects is just as important as faithfully working
through the change management project plan. This means, in particular, to
prepare everyone involved for the challenges pertaining to corporate cultural
brought about by the change management project. Consequently, HR is often
called upon to organize corporate-wide discourses on questions that do not have
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so much space in the company during normal operation, e.g., how comfortable do
I feel in the new structure, or, what am I afraid of, etc.
2. Adjustment of long-term individual personnel development: It will be crucial to
adapt the existing individual development plans and career plans to the new, postchange situation to ensure that employees continue to have prospects and to see
these clearly. Talking to the employees about how the change process will affect
their future career prospects will pay off in the long-term retention of the staff.
3. Advancement of knowledge management as the central surrounding system for
personnel development: It is important to identify the effects of change management on the previous knowledge management system, to communicate them
explicitly to the employees, and to ensure that team learning (Raes et al., 2015)
and organizational learning (Argyris & Schön, 1978) are not interrupted at all and
that high-performance work teams (Katzenbach & Smith, 1993; Devaraj & Jiang,
2019) are preserved.
HR can not only actively support change management in all three points, but can
also specifically evaluate the effects of the respective activities, for example, in terms
of results, behavior, learning, and reaction (Kirkpatrick & Kirkpatrick, 2006;
Kirkpatrick & Kayser Kirkpatrick, 2009). HR can, moreover, establish a mechanism
for leaning transfer from those employees directly affected by the change management to those employees that are further away (Greer & Stiles, 2016).
Takeaway for HR:
HR should systematically rethink and examine the effects of change management
on personnel development: How do employees need to be developed so that they get
a feel for the new “unwritten rules” in the company of how “good” or “bad” behavior
is understood and set themselves up so that they continue to feel comfortable in their
job? Is there a systematic process in which individual career plans can be adapted to
the new situation? And how will employees be informed company-wide about how
the change will affect the processes of organizational learning and what exactly will
be reconfigured?
6.2.2
Integration of Change Management into
the Professionalization of HR
HR professionalization (Stein, 2010) is a theory-driven program to bring HR into
better alignment for value creation and to strengthen its contributions to the organization. Measuring the exact share in value creation attributable to secondary functions of the value chain (Porter, 1985), such as HR, is particularly difficult, and yet of
utmost importance, as it is a vital factor in the success of the overall business model
of a company in today’s competitive markets (see Schwarz and Gustafsson in this
volume).
HR can notably contribute to value creation if the four professionalization
conditions are met (Stein, 2010):
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1. Differentiation: The professionalization of HR consciously takes into account the
different needs of its target groups. There is no one single employer image, no one
single motivation factor, and no one single binding tool for “the employees.” This
holds all the more true since a new generation of employees, Generation Z
(Scholz, 2014), wants to be treated entirely differently from their predecessors
(see Koinig and Diehl in this volume). An HR function which neglects the
differentiation runs the risk of losing the commitment of the employees, i.e.,
their firm engagement to work—the employees feel that they are not personally a
part of the organization. With a decreasing commitment of the employees, their
willingness to perform and willingness to cooperate also drop. Regaining lost
commitment requires a lot of work to apologize, explain the negatively perceived
behavior, or symbolically make atonement. A properly professionalized HR can
avoid all this right from the start. Therefore, differentiation means to know the
actual needs of the HR function’s target groups, to mirror them professionally in
HR work, and to meet them.
2. Continuity: For employees and other stakeholders in HR processes, there is not
much that is as bad for mutual trust as a broken promise. The moment promises
are made, they create expectations among the addressees—a promise is a promise. This maxim can also precede professional HR; for example, employees want
to be sure that the prospective changes promised after an employee survey will be
tackled, or a work council expects HR to actively provide information after it had
promised a “far-reaching cooperation.” Continuity should create orientation and
sustainability. An HR which neglects continuity runs the risk of losing the trust of
the employees. Erratic or disjointed behavior in HR leads employees to feel that
they cannot rely on and commit to what has been said in the long term. Loss of
trust is a crucial step toward the inner resignation of employees. Therefore, HR
must move away from on-off solutions and replace them with long-term actions!
The announcements it makes to its target groups must be authentic, reflecting that
promises have been kept in the past and credibly signaling that HR will make
every effort to meet them in the future.
3. Expertise: HR is a field partly populated by people who have not learned the full
width of the business system context from scratch. Labor lawyers, psychologists,
sociologists, and lateral entrants from other, further removed professions can also
become good HR managers; nevertheless, they must know precisely how HR is
embedded in the business context of corporate strategy, accounting, financing,
and controlling because this has a decisive influence on what HR can and cannot
do. In addition, HR professionals need to understand their (labor) market environment to hold their ground in it. An HR which neglects expertise runs the risk
of losing the acceptance of the employees and their participation in the implementation of decisions. Employees do not take HR seriously when they feel that
its decisions are not well-founded. When acceptance declines, previous willingness to cooperate is replaced by an increasingly critical attitude that fundamentally questions every move proposed by HR. Therefore, HR needs to transform
itself into a core competence of the company; this means to direct HR through
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experts, to set up a quality management for HR, and to design HR as a corporate
function that is continuously learning.
4. Governance: Governance is the technical term for the comprehensive, compliant,
business model-related strategic control of companies. While governance is the
top management’s responsibility, it depends on the participation of all operational
functions in the company. Just as top management cannot achieve its value
creation or profit goals without HR, HR cannot do without the top management’s
support; both need each other as strategic allies (see Trommershausen in this
volume). To become allies, they must first “speak the same language.” HR is
expected to not only consider “the people,” and thus “soft factors,” but also “the
numbers,” and thus “hard factors.” If HR succeeds in proving its contribution of
added value for the company by means of economic arguments in the language of
“money,” “costs,” and “revenues,” it will be taken seriously by the top management. On this mutual ground, the future corporate strategy can be formulated
together. The more willing the top management is to address HR issues, the
bigger the chance of reaching the goals of professional HR with support from the
top. Corporate management and HR then work hand in hand. An HR which
neglects governance runs the risk of being relegated to the role of pure HR
administration and becoming marginalized overall by a frustrated top management. In such a case, HR managers will not feel taken seriously, and their
frustration and feeling of futility would affect the general self-image of all
employees and stakeholders of HR processes, as this would create a situation in
which there is no apparent backing for the concerns of employees. Therefore, HR
must make a splash and bring itself onto the radar screen of the top management.
It must secure influence over strategic corporate decisions and establish a constant
presence in the top management, and, if one exists, in the supervisory body, it
must also match the HR strategy with the corporate strategy.
Over time, change management has become a major core competence of HR in
terms of a methodological HR leadership competence. It is the “how to” of change
processes that must be mastered to its maximum. If looking at the failure statistics of
change management projects (e.g., Anand & Barsoux, 2017; Graamans et al., 2020),
it is often the case that the responsible people theoretically know, for example, how
communication during change processes should work, but in practice fail to implement a viable communication procedure. Further exemplifying this one point, all
components of the HR professionalization model apply:
– Differentiation: Addressing those involved in the process must be based on their
prior knowledge, their understanding of the goals, their insight into the overall
operational context, and their extent of integration in the change process.
– Continuity: Information must be provided constantly, consistently, and repeated
over and over again. There is no reason to fear people becoming bored with such
repetition of information provision, as it is rather the case that the reach of
previous information is overestimated. Communication will become more efficient over time, but it is still necessary to stick to it and keep up the rhythm.
Therefore, a higher frequency of information provision is recommended, which
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V. Stein
should be done face-to-face as often as possible, because there is the opportunity
of seeing the resonance of the information and of direct interaction.
– Expertise: It is crucial to know exactly what information is needed. This relates to
both the change-related content and the process-related information. In addition,
the recipients’ subsequent interpretation of the information must be anticipated as
closely as possible in order to take proactive countermeasures against
misunderstandings.
– Governance: The communication must be in line with the ideas of the top
management and, above all, with the requirements of the business model of the
company. The business model is the central reference point to which all valueadding action must be directed—including all change management activities and,
therefore, all accompanying communication.
Since communication is only one methodological element of change management, there will be much more to do for HR to systematically align change
management to professionalization in terms of every element.
Takeaway for HR:
Based on these four professionalization components, the HR department of the
organization can work through every single ingredient of change management and
question it step by step: What would be the differentiated approach? Is there a
common thread that is followed continuously, both when the process is running
smoothly and when it becomes fraught with difficulties? Are the involved participants capable of speaking as the absolute experts, both in regard to content and
procedure? And is everything that is being changed still in line with the company’s
overarching business model and contributing to it?
6.2.3
Instrumentalizing Agility for Change Management
Change management is specifically project-related, which means that there are
certain expectations regarding the implementation. In addition, change is integrated
into the general trends from process optimization to agility concepts.
Agility means the application of methods in order to create flexibility and prevent
organizations from falling into a routine in their work (Ahammad et al., 2020;
Bywater et al., 2020). The increase in organizational agility is reflected in the
constant questioning of individual process steps, in the willingness to disrupt the
status quo, and in the acceleration of adaptation processes. In terms of personnel,
some employees are made responsible for performing different roles in the context of
Scrum (Justice, 2018) or design thinking (Yoshida, 2018), as two of the agile
frameworks for developing new products and, above all, for keeping the process
going according to the basic rules of agile action (Tilman & Jacoby, 2019; see
Leitner in this volume).
However, it is quite difficult for employees to bring the world of change management and the world of agility together: While change management designs a
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predetermined goal and a clearly defined process with defined milestones until the
goal is achieved, agile management aims at an open-ended process, which specifies
close intervals and rhythmized repetitions for personal contacts and project tasks in
order to achieve product success quickly and at the same time to take into account
the potentially changing environmental dynamics (Yoshida, 2018).
HR can be the mediator between the two worlds: First, HR can clarify where the
differences between change management and agility lie and can make agility fruitful
for the change management process by using it as a catalyst and accelerant for
change management. Second, HR can ensure that neither becomes too bureaucratic,
which is something that can become an actual danger for the process. While change
management can represent a relatively rigid framework for change, agility concepts
are not immune to slipping into a bureaucratic form of process implementation and
organizing the interaction rhythms rather than the innovations that arise in them.
Third, HR can ensure that the control of change management, however agile, is not
focusing overly much on the input, i.e., only looking at how much effort goes into it,
but rather on a consistent output logic that is all about performance, outcome, and
results.
Takeaway for HR:
HR should systematically question what the relationship is between a defined
change management project on the one hand and general flexibility and agility in the
company’s innovation behavior on the other hand. In addition, HR should proactively build a bridge between these two worlds and communicate and build upon the
similarities, but also the contradictions between the two concepts. Finally, HR can
relate change management concepts and agility concepts to one another, optimally
assigning instrumental importance to agility when it comes to achieving predefined,
concrete change objectives.
6.3
Recent Trends Affecting HR with Consequences
for Change Management
In addition to the interface topics, there is a dynamic in the field of HR that either
comes from business and society or is driven by academic business research. This
dynamic results in newer trends that, for a start, affect HR and then imply a
subsequent need to look at the extent to which further change management processes
will be necessary. These will then probably be initiated directly by the HR departments of companies. Three of these recent trends will be highlighted below and
briefly reflected on in terms of their potential consequences.
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6.3.1
V. Stein
Change Toward New Work? The Post-Corona
Working World
The COVID-19 crisis will affect the developments which already started before the
spread of the coronavirus and which are well-known under the catchword “New
Work” (Bergmann, 2019; see Roth-Ebner; Koinig and Diehl in this volume). This
concept aims at a paradigm shift, moving away from wage labor toward a kind of
work which is connected to the meaning of life and meets requirements such as
creativity, autonomy, freedom of choice, participation in the community, and ultimately, self-fulfillment. Part of this readjustment is the more conscious weighting of
different aspects of life such as personal development and work satisfaction or the
balanced pursuit of ensuring the conditions of existence and seeking happiness, and
digitization is expected to enable substantial progress in this regard.
In the course of the exceptional pandemic situation, work itself has become more
digital in many contexts—if not to say in every work context. This creates new
expectations for the future organization of work as well as for the future design of
companies as loci in which employees want to make meaningful contributions.
However, in addition to many opportunities, the increasing digitalization of work
also brings various risks with it, for example, with regard to precarious employment
relationships, social collateral damage, and asymmetrical tendencies toward corporate profit optimization at the expense of the workers (Scholz, 2018).
During their remote work from home with strenuous online meetings, employees
notice that they can solve problems with others much faster: “You get connected to
the people, suddenly, they are available!” Obviously, many decision-makers were
deprived of cooperative work in their normal working mode—they were on business
trips, sat in endless meetings, or were pressed into the standardized process corsets,
which ironically popped up in the wake of agility concepts. Now they feel how good
the current bureaucracy detox does them.
This means that an old field is reopening for HR, namely, the movement toward
New Work. This movement will change from a gradually emerging change to a
strategically intended change, and, therefore, it will also need a change management
structure.
It is foreseeable that working from home will gain further importance as a
widespread working model even after the crisis—but only partially (see RothEbner; Koinig and Diehl in this volume). Even if some employees and companies
value the flexibility that has arisen, there are also indications that the pendulum will
swing back. In the long term, employees seem not to have much interest in merging
private life and work to such an extent that they themselves pay for their personal
work equipment and submit to the expectation that they have to be available around
the clock while their company saves on rental costs for office space and elegantly
benefits from the circumvention of the Working Hours Act.
In respect to that, change management is to be embedded in a larger dialogue that
must be conducted between the top management and HR on the one hand and
employees and the works council, in some cases also the trade unions, on the
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other hand. The respective positions are not so clearly “pro remote work” or “contra
remote work,” as a more detailed examination reveals that these new work conditions might be a bit of a “mixed bag” in terms of work-life balance (Scholz, 2018).
HR can take the role of a safeguard and warn against an excessively euphoric and
uncritical welcome of new working models that could, in the long run, turn out to be
detrimental to the employees.
Takeaway for HR:
Even if the corporate body is in some ways disintegrating in the course of the
COVID-19 outbreak and in the aftermath, HR needs to make sure that the company
as a collective entity of people keeps its sense of belonging and feeling of togetherness. Whatever direction of change will emerge, it will remain imperative that the
related change management process ensures that comparable company-wide working conditions prevail, that in particular the executives experience the same workrelated challenges as the rest of the workforce, and that forums are deliberately
created to allow people to talk not only about business but also where they can
express themselves personally. HR can also open the discourse on the extent to
which the forced changes in working conditions can and should lead to a
readjustment of the meaning of work in the company and which potential benefits
of New Work are already emerging.
6.3.2
HR Value Contribution: Risk Governance
Another central question that many HR departments grapple with is the not-entirelynew question of how the strategic viability of its company can be increased and how
HR can contribute to this. From a business perspective, the decisive factor for the
strategic success of a company is the business model (Silvente et al., 2019; see
Schwarz and Gustafsson in this volume). The management defines (a) the competitive services with which the customers are to be won over and convinced, (b) how
the promised services are organized structurally and procedurally to ensure that they
are provided efficiently in regular operations, and (c) how the correspondingly
required payment and cash flows are kept running. All three adjusting screws for
the added value of the company require constant fine-tuning, and sometimes, even a
disruptive redesign is necessary, i.e., the fundamental, radical breakaway from the
familiar formula.
The guiding lights for this continuous adaptation of the business model are the
future opportunities and risks. Basically, this is a look into the crystal ball, but
knowledge of megatrends right through to innovative new technological developments allows the horizon of what can be expected to be pushed further into the
future. However, the risks for the business model are manifold, located on a complex
risk map, making risk assessment increasingly difficult. One reason for this complexity is that there are more and more both well-known and completely new risks to
be considered that mutually influence, possibly reinforce, and potentiate each other.
The mathematical rule that the maximum risk is the sum of the individual risks no
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longer applies. In addition, social media has created a new dynamism in the business
world, due to which risks can occur almost without early warning and escalate in real
time—and those who do not act quickly are overwhelmed by the “risk tsunami.” The
more connected companies, media, business, and society are, the more connected the
risks are—which is just one of the lessons COVID-19 has taught us.
Depending on the preference of the actors regarding how to handle risks, various
functions in the company can be given the most influential role. Avoiding and
hedging risk has traditionally been the field of risk management. It is particularly
effective when it reports hardly any risks to the top management level, because it has
already mastered the identified risks with its risk models and processes and has thus
filtered them out. Unfortunately, with the increasing influence of the risk management, there is more and more important strategic information which does not reach
the top management of the company: Which of the known and less well-known risks
could aggregate, which dynamics are hidden behind it, and how are the risks related
to the business model?
Traditional risk management has recently been supplemented by a much more
strategic function: risk governance (Stein & Wiedemann, 2016; Stein et al., 2019).
Risk governance seeks to control risks by actively searching for previously
unforeseen risks and connecting them with the value creation potential at the
strategic level. The primary question is: What must be done so that unforeseen
risk events do not suddenly endanger the continued existence of the company? At its
core, risk governance is a fundamental mindset in business risk research and means
the permeation of an organization with stakeholder-oriented risk management, i.e.,
with the broad consideration of risks that result from the relationships with all other
actors and thus stakeholders in the corporate network. In this way, risk governance is
closely linked to the strategic business model, because this is where stakeholder
interests are represented—and if their interests do not match the self-interests of the
company, this may entail risks that are difficult to predict. At this strategic level, risk
governance strives to manage risk from the inside in an anticipatory manner.
Interestingly, risk governance frees itself from the operational risk management
and complements it, from its strategic altitude, with four tasks (Stein & Wiedemann,
2016):
1. Constantly questioning and adapting the risk models used so that risk recognition,
prioritization, and aggregation keep pace with environmental changes and
allowing for several alternative risk models to be available for the top management to choose from
2. Making the risks arising from the risk models themselves understandable and
excluding risk models containing errors from the outset through the systematic
determination of model risks
3. Continuously developing the existing risk expertise in a research-related manner
in order not to miss any recent scientific and methodological advancements and
adapting them to the specific context of the company immediately as they become
available
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4. Actively advising the top management on risk issues to enable it to master the
risk-related business model adjustment and use their “tone from the top” communication to send effective signals in the direction of a sustainable risk culture
All four tasks support the top management in dealing with its complex risk map
effectively and are intended to enable it to cope with nonlinear developments, assess
exponential risk evolution, adjust strategies at an early stage, and react in a timely
manner to ongoing developments.
These tasks are put into practice in a risk governance circle, which—similarly to a
quality circle in a production company—receives concerns and risk information
from employees of all functional areas, systematizes them, and discusses them with
regard to the effects on the business model (see Schwarz and Gustafsson in this
volume). Who would know better the risks that can affect the entire company if not
the employees in their respective working environment? As any manager knows, it is
not uncommon after an incident to hear sentences like “. . . if they had asked me
earlier. . .,” which shows that every employee on-site can act as a responsible risk
manager. Harnessing this potential could lead to a strengthening of the companywide risk culture and, thus, to a broad search for possible challenges and risks. For
example, a financial accountant sees different risks than a production employee, an
HR manager, or an IT specialist. The participants in the risk governance circle
should intuitively trust their instinct for risk and opportunity, think ahead, and
register doubts, in order to create a business model-related early warning system.
The risk governance circle makes only a preliminary assessment of the risks
related to the business model and transmits them to the top management without
filtering out too much. The motto is “as comprehensive as possible, as simplified as
possible.” This is possible, for example, via risk catalogs, in which the likelihood of
occurrence and the impact of financial damage, staff retention, and reputation are
assessed for a wide variety of risks. The top management then compares the reported
risk areas with its strategic positioning; deals with the given warnings; modifies its
planning of goals, priorities, and use of resources in the light of new facts; develops
its strategies further; and reports back to the risk governance group that (and with
what result) it has dealt with the information provided. The decisions taken can then
be implemented (see Mödritscher and Wall in this volume). In the first place,
however, this risk governance procedure affects the top management toward actually
and consciously considering its comprehensive risk map. If necessary, it can then
quickly adapt the business model in the light of the current risk status.
This procedure thus empowers employees from the various functional areas to
contribute to making the company’s business model more resilient. If abstracting
risk governance, its basic principle is multiple network-building. This corresponds to
the well-established basic principle of system theory: The more complex a problem
becomes, the more complex the problem-solving system must become.
Takeaway for HR:
If the complex problem of the overall company is the definition of the successful
business model, i.e., securing the customer base, ensuring liquidity, sustainable
profit, and the long-term existence of the company, then an essential part of the
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solution is network-building, i.e., the closer involvement of many actors in the
assumption of responsibility (see Trommershausen and Koinig et al. in this volume).
HR is predestined to organize the continuous and comprehensive change management process. As a result, HR can ensure that each individual employee will be able
to evaluate the information received at their interfaces to external stakeholders as
well as to internal colleagues more actively with regard to the business model and
share it in the risk governance circle. This ensures the long-term resilience of the
company because the top management is no longer isolated from the business model
risks that employees perceive “at the front” and therefore does not fall into a
narrowed risk control routine mode. HR is perfectly positioned to promote networking between actors from the “bottom” and “top” of the company and thus establish a
comprehensive risk culture that sensitizes employees to caution, transparency, and
responsibility.
6.3.3
Shaping the Future: HARM
As in the past, change management will carry on relating to a change in behavior
among people and, thus, to the core field of responsibility of HR. The question here
is whether a new game changer will emerge that will play a stronger role in future
HR-related change management projects than before.
A game changer that is already partially visible is the increasing automation and
robotization of work, which raises questions about the cooperation of people with
machines. While computers and robots emerged about 50 years ago, digitalization is
now determining the organization of work and its social and political effects. The
development has, for example, brought about smart factories, in which extremely
modular manufacturing processes are now controlled via cyber-physical systems and
in which people from the work cloud work together with increasingly autonomous
and faster deciding machines in data-optimized processes, the monitoring of which
is also becoming increasingly automated (see Leitner in this volume).
But who in modern companies should actually “play” the role of this interface,
i.e., the coordination of human and machine work? Which operational function
should bear the burden of ensuring that work resources of any kind are allocated
and planned in as integrated a way as possible?
This interface could be located at HR. This assertion stems from a clear need for a
fundamental rethinking of the previous resource management system. In the current
system, it is usually the case that automation, i.e., machine use and robotics, is
controlled by technology-oriented functions, such as IT and production. Their basic
decisions are consequently derived from how the digital processes are designed and
how people are to be subsequently integrated. HR, on the other hand, is traditionally
dedicated to the individual and social control of people, but is only peripherally
concerned with automation as well as with the procurement and use of robots. Taken
together, automation and HR have so far been in two parallel, separate worlds.
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However, there is a general fear that people may lose their jobs to machines.
Robots are not only becoming dramatically cheaper, but also more capable in
connection with artificial intelligence and automation; they work constantly and
without errors, potentially making them the perfect job killers. Conversely, people
have some advantages that can hardly be replaced by machines, i.e., people can act
creatively, judiciously, and with social empathy and adapt their behavior to the
situation at hand. In addition, especially in the course of digitalization, many new
work tasks are created that require exactly these uniquely human skills and traits.
This is exactly where HR comes into play: Ultimately, it needs to reinvent itself in
order to adapt to these changed framework conditions. HR needs its own answers to
the challenges that human work faces right now. How should HR deal, for example,
with completely new factory layouts? How do self-learning machines learn from
people and people from self-learning machines? What happens to corporate culture
and work ethics when robots work more cheaply and more efficiently than humans
ever could? What kind of working environment should HR prepare for?
The prevailing assumption that the distribution of work between machines and
humans is a zero-sum game—if one side wins, the other loses—is misleading. On
the contrary, there are possibilities for a win-win solution, which considers both
sides of the same coin at the same time and whose implementation could begin very
specifically in smart factories in the form of an integration of human resource
management (HRM) and automation resource management (ARM) to a new operational function “human automation resource management” (HARM) (Stein &
Scholz, 2020). Such a HARM function can meet several objectives: First, in times
when qualified human workers and advanced automation resources are still comparatively scarce and expensive, the HARM function can decide on both resources,
taking their interactions into account, and thus has more flexibility for the integrated
use of resources. Second, it can react quickly in the face of ongoing process
acceleration because information asymmetries between (previously several)
decision-makers do not even arise when decisions about machines and people are
taken by a single entity. Third, such a HARM function would be able to create a
whole new basis of how people and machines will be combined in the future, both in
respect to their interaction and their further joint development. This would minimize
future operational risks and have a positive effect on the corporate culture. To put
things succinctly: The HARM function increases the synergies between man and
machine.
Synergy always means that combining previously isolated activities creates an
added value that is greater than the pure addition of the activities would suggest. For
example, the HARM function can align modularized automatic processes from the
outset toward decentralized, mobile, agile work and thus combine the best of both
worlds. With regard to knowledge management, the HARM function can combine
automation learning and the associated artificial intelligence with human competence development. The HARM function could contribute to a better integration of
the speech systems of people and machines and help create a governance framework
for legally permissible, responsible, sustainable, and ethical control of the cooperation between machines and people. These, like many others, are strategic synergies.
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“Synergetic resource management 4.0” is no longer just a freestyle exercise, but a
compulsory program.
Takeaway for HR:
At this point, HR can consciously take the path of a self-directed change
management. It can control the diverse changes that HARM integration requires,
which are mainly focused on training and skills development for people and for
machines—especially for controlling human-robot resource coordination, for practicing new structures in man-machine-networked projects, and for strengthening
employee-based participation in a corporate culture based on reciprocity, openness,
and collaboration in a machine-based work context, i.e., strengthening contemporary
HARM governance. HR should take the framework of digitalization as a given and
ask whether it wants to be a hindrance to synergy or a synergy supporter.
6.4
Conclusion and Outlook
If one takes the described interfaces between HR and change management as well as
the exemplary fields of action in which HR will be required to initiate change
management processes in the near future, it becomes apparent that the connecting
element is dynamization. Digitalization (Loebbecke & Picot, 2015; see Roth-Ebner
in this volume) is not the only challenge that will decide the future economic success
of companies. Networking, automation, flexibilization, socio-structural shifts, and
the re-glocalization, all this means a significant increase in dynamics (Virilio, 1984)
as the new normalcy of and in organizations (Farjoun, 2010, p. 206).
Some years ago, research on dynamization started as an HR-related research
program (Stein & Müller, 2012) that is still going on. In order to operationalize
dynamization, six connotations were proposed for dynamization (Stein, 2012, 2015):
– More dynamic means “more differentiated.” This connotation looks at goals,
tasks, and structures. Internal and external stakeholders are continuously changing their demands, and new stakeholders emerge over time, and a dynamic system
must therefore persistently be able to establish and retain multiple and differentiated fits between the stakeholders’ demands and the company’s own objectives,
structures, and tasks.
– More dynamic means “faster.” The processes in a dynamic system must be
accelerated. It is critical for the system’s success that the completion of a process
takes place as fast as possible. Process management, process automation, and
process controlling need to become virtually real time. Due to organizational
inertia, such velocity constantly needs to be developed and fostered.
– More dynamic means “more versatile.” This connotation focuses on the longterm change of a dynamic system. Depending on the emerging situation, existing
solutions that have worked for a long time may no longer be appropriate. A
dynamic system must be able to develop proactively and to open itself toward
creative destruction.
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– More dynamic means “more strategically agile.” Focusing on the change culture,
a dynamic system can be characterized by values such as openness toward
emergence into something new and willingness to take risks; however, it is to
be oriented toward the long-term rationale of strategic sustainability so that the
investments and risks are worth taking. Breaking new grounds that is perceived to
be necessary should be balanced with the requirements of long-term strategic
sustainability and competitive survival.
– More dynamic means “more methodologically competent.” Dynamization also
affects the knowledge base and learning. Outdated knowledge becomes obsolete
and new knowledge must be learned. But it is also necessary to use methods of
“thinking in dynamics,” i.e., in time periods rather than in points of time, and to
apply future-oriented methods such as simulations.
– More dynamic means “more flexible.” Regarding the conceptual anchor of
cooperation and collaboration, dynamic systems with multiple resource dependencies and many interconnected partners in system-spanning networks need not
only to provide resources with minimal lead time when aiming to adapt to shortterm opportunities, but also at that place where the demand is urgent and resource
allocation promises optimal resource effectiveness and the creation of synergies.
Therefore, the demand-oriented and still transparent and accountable resource
allocation must be managed.
In corporate reality, these six connotations exist simultaneously and are highly
interconnected. They serve as a framework for HR self-assessment and offer a
framework for further integration of HR and change management.
As a practical implication, HR needs to ask how people in the company can adapt
to these new dynamics. Appropriate learning content and corresponding learning
methods are necessary for each single connotation (Stein, 2015). Once the HR
function and the employees are appropriately sensitized, individual change management processes can also focus on the different qualities of dynamization.
As an implication for further research, this means that change management is no
longer just about performing the change management process as effectively as
possible. Rather, the matter at hand shifts to the fundamental evolution of change
management: toward a change management that meets the prevailing dynamization
requirements on a more abstract and systematic level, for example, in terms of
dynamic capabilities (Teece, 2018). Such a change management is then taken over
by an HR which, in turn, knows its role in the company’s value creation structure and
plays it responsibly. Ultimately, this also requires that the HR function be reoriented
and professionalized in the direction of dynamization. An HR that wants to play the
role of a change agent (Ulrich, 1997) must first master differentiation, continuity,
expertise, and governance in terms of dynamization—and at least in relation to
personnel development, agility, New Work, risk governance, digitalization and
new media, and human automation resource management.
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Exercise and Reflexive Questions
1. Systematically apply the four components of the HR professionalization model
with the challenge that resistance must be taken into account in the change
management process and that the “losers” of the process are to receive a fair
compensation.
2. Discuss which procedural requirements of the Scrum concept (which you will
find on the Internet) may reduce agility and counteract the goals of change
management.
3. Go onto the Internet and look for three recent remote work guidelines of companies. To what extent do they reflect the interests of the company, and to what
extent do they reflect the interests of the employees?
4. Discuss the statement: “Every employee is a risk manager.”
5. Develop an HR development concept for an HR manager who should take
responsibility for implementing risk governance in the company.
6. Identify further activity fields of HR in which change might imply synergies with
other corporate functions.
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Volker Stein is full professor for Business Administration, especially Human Resource Management and Organizational Behavior at the University of Siegen, Germany. He is founding director
of University Siegen Business School. His research areas focus on
strategic HRM, human capital management, international empirical organizational research, market-based leadership in organizations, critical informal network studies, risk governance, and
university management. Since 2019, Volker Stein is Prorector
for Resources and Governance at the University of Siegen. For
further information, please see https://www.pmg.uni-siegen.de.
Chapter 7
Work in Transition: Digital Media and Its
Transformative Potential for Work
Caroline Roth-Ebner
Abstract In tandem with the technological developments of the past decades in the
form of new information and communication technologies (ICTs), the world of work
has faced a significant transformation. Some call it a revolution and compare its
effects with the changes wrought by the Industrial Revolution in the eighteenth and
nineteenth century. This chapter deals with the changes in office respectively
knowledge work and their implications for an organisation’s change management.
Through the use of the Internet, mobile devices and their various applications for
communication and collaboration, work is becoming more and more virtualised.
This enables flexibility and mobility as well as global communication and collaboration. In the course of these developments, on the one hand, the subject gains more
and more responsibility, while, on the other hand, digital work processes abet a
standardisation of work. Yet, these processes are not one-sided but framed by
various conditions and socially grounded. In this chapter, the theoretical concept
of the mediatisation of work serves to explain the interrelation of the current
technological and the sociocultural transformation as well as the changes in the
world of work. The insights presented here are substantiated by the results of a study
conducted by the author and by studies carried out by other scholars, as well as
literature from sociology, business economics and media and communications.
7.1
Introduction
Since the establishment of personal computers in offices in the 1980s, the world of
work has undergone an extensive transformation that is imputed to have revolutionary potential. Fields of activity or entire professions have become obsolete, and new
ones have emerged. Previously analogue processes have been translated into digital
ones and thus increasingly standardised and rationalised. Along with the ever more
complex professional use of information and communication technologies (ICTs) in
C. Roth-Ebner (*)
University of Klagenfurt, Klagenfurt, Austria
e-mail: caroline.roth@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_7
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the form of digital media, the demands on employees have increased in almost all
areas of activity. Social networks, mobile Internet use and user-friendly microprogrammes for smartphones (apps) are the latest developments that have shaped
media use in office work to a large extent.1
In this chapter, the transformative potential of digital media is explained using the
theoretical concept of mediatisation (Krotz, 2007a) under the focus of knowledge or
office work. These fields of work are characterised by information and communication activities, which are largely carried out using digital media like personal
computers, notebooks, tablets, smartphones and their applications (Roth-Ebner,
2015a, p. 47). The concept “mediatisation of work” (Roth-Ebner, 2015a, 2016b,
2016c) refers to the media-communicative change that takes place along with new
technological developments in interaction with social change and the changes in the
world of work. For example, work is increasingly available digitally, which allows
greater flexibility and mobility of work, but also raises new questions about the
boundaries between private life and work (see Koinig and Diehl in this volume). In
the context of the meta-process of globalisation, digital media help to overcome
territorial boundaries and facilitate international cooperation and networking. The
subject itself gains more and more personal responsibility, which is triggered by
project-oriented work structures, flexible work cultures and new forms of (self-)
employment, but also by the use of digital media, which requires autonomous
decisions and action. At the same time and corresponding to the prevailing neoliberal
values in our society, digital work processes encourage standardisation and
rationalisation of work. This is, for example, manifested in targeted efficiency
strategies of the workers. In the following, these characteristics of mediatised work
environments are described with reference to a study on the mediatisation of work
(Roth-Ebner, 2015a, 2016c). Research was carried out with people who were
intensively involved in digital communication and information tasks at work. The
study was guided by the questions of how the use of digital media influenced their
way of working, which potentials and challenges arose and by means of which
practices the subjects met the new requirements. The focus was placed on the spatial
and time perceptions of the employees as well as their space and time actions, since
space and time are particularly influenced by mediatisation processes (Krotz, 2007b,
p. 39). The data were based on 20 qualitative guided interviews with heavy digital
media users as well as media usage diaries and visualisations that they had created.
Moreover, a standardised online survey (N ¼ 445) was conducted in order to relate
the deep insights of the qualitative study to a broader population at different levels of
media use intensity. In addition to that data, further studies and literature, especially
from sociology, business economics and media and communications, will be taken
into account. The chapter focusses on the micro level by explaining the perspective
of the workers, but it also addresses the meso and macro level, since individual
action can only be understood in the context of organisational and societal
1
The Internet of Things, e.g. in the forms of smart watches, glasses as well as virtual reality
applications, do not play a significant role in office work to date.
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developments and circumstances. The chapter is intended to outline a panorama of
the recent developments in office or knowledge work. Based on this, recommendations are made for organisations on how they can support their employees in an
increasingly digitally shaped work environment in the course of change management
(see Stein; Koinig and Diehl in this volume).
7.2
Virtualisation of Work
According to Roth-Ebner (2015a, p. 47f.), the term “virtualisation of work”
describes the shifting of work action into virtual space. Hence, work exists separately
from physical objects (except from networks, wires and end devices) in the form of
information and communication flows, which are processed and transported in
computer networks (mostly the Internet and intranet). The virtualisation of work is
closely linked to the technological developments of the past three decades, above all
the Internet. Today, in Austria and Germany one can nearly speak of a full supply of
companies with the Internet (Statistik Austria, 2019a; Destatis, 2019).
Examples of virtual work are to communicate via e-mail or instant messenger,
maintain databases, describe a workflow in the in-house social network or participate
in a virtual meeting. With the use of digital media, so-called virtual workspaces are
created which can take different forms and fulfil a variety of functions: they are
communication rooms, self-presentation and contact rooms, learning rooms,
archives, service rooms and much more. However, virtual work is by no means
detached from spatial ties, as emphasised by Mascha Will-Zocholl et al. (2019,
p. 50). Instead, the authors promote shifts in and the multiplication of the spatial
references. As an example, these rooms are often used almost simultaneously or
parallel to each other, since they are just a click away.
Arnold Picot and Rahild Neuburger (2008, p. 223) differentiate virtual work at
the level of work organisation into virtual employees, virtual teams and virtual
companies. Yet, pure virtually organised collaboration has proven empirically
difficult, as Ursula Holtgrewe (2014, p. 19) points out with reference to different
studies. Face-to-face contacts are seen as important, especially for building trust and
establishing a constructive work base. An independent communication manager
interviewed as part of the study on the mediatisation of work serves as a suitable
example. In the past, he managed his Austrian company from the USA for a period
of 2 years. He handled the contact with the employees via digital media, especially
by e-mail. However, he attaches great importance to knowing the employees personally and explains this as follows:
“Because otherwise there is no trust. A working collaboration via e-mail only
really worked if you met people somewhere at least once. I’ve always striven for
that, even if it was only five minutes between door and hinge, but then yes, assign
[him or her, CRE]. ‘This is him or her, all right.’ It was a completely different
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C. Roth-Ebner
collaboration. It’s never the same without getting to know each other personally.”
(Communication Manager, 33 years old)2
This statement is ideally typical for most study participants, who attribute a
central importance to personal contact, especially when it comes to (larger) business
deals (Roth-Ebner, 2015a, p. 235 f.). In addition to the question of building trust,
virtual work also harbours the risk of isolation or distraction from work (Amstutz
et al., 2013, p. 11; Roth-Ebner, 2015a, p. 265 f.). In this context, the company Yahoo
caused a sensation in 2013 when it decided to stop remote working arrangements and
insisted instead on physical presence in the company in order to increase the
productivity of the employees and to improve the quality of the cooperation
(Valdellon, 2015). Preventing isolation in the home office, especially when selfemployed, is also a central motivation for more and more (virtual) workers to come
together physically in so-called coworking spaces (Leclercq-Vandelannoitte &
Isaac, 2016).
During the writing of this contribution (March 2020), virtual work has gained
huge importance, since Covid-19 (coronavirus) has been spreading rapidly around
the world and people in more and more countries have been called on to work from
home in order to prevent the spread of infection. A vast number of people have been
forced to do their work from their home office, if they have one, or at the kitchen
table, if they do not. In many cases, the children are also at home, because schools
have closed due to the crisis. This has caused many problems. The downsides of
virtual work (from home) have been condensed in these spontaneous, unplanned
home working scenarios, like distraction due to private/family/school affairs, technological problems and IT security, difficulties in team communication or limited
access to information. Despite all these difficulties, the time- and space-independent
use of digital media allows work processes to go on, at least in the case of
knowledge work.
7.3
Flexible, Mobile Working
The technological developments of the past two decades have brought numerous
innovations, especially in the field of mobile technologies. Networks and devices
that are ever more powerful have driven mobile Internet use. Falling acquisition
costs, low usage fees (especially flat rates) and an inexhaustible variety of mobile
applications (apps) have helped to increase the acceptance and intensity of use of
mobile Internet-enabled devices such as smartphones and tablet computers. This
applies not only to the private but also to the professional sphere. Referring to Jutta
Rump (2010), one can speak of an “electronic mobility” of work, which is enabled
by digital media and contributes to the flexibilisation of the workspace. In 2018,
2
The interviews were conducted in German; citations were translated by the author for the purpose
of this contribution.
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nearly one third of the employees in European enterprises with ten or more
employees were equipped with mobile devices with Internet access (Statistik Austria, 2019b, p. 46). Statistical data also shows that the use of chargeable cloud
services has increased enormously during the past decade. A European survey
indicates a surge of 92 percent in European enterprises with ten or more employees
in the period from 2014 (12 percent) to 2018 (23 percent) (ibid., p. 18 f.). It can be
assumed that these numbers have continued to grow since then. Cloud-based
applications enable time- and space-independent access to data simply by means
of an Internet-enabled device and Internet access. This is an enormous relief for the
organisation of translocal work, e.g. in times of Covid-19-related virtual work.
Programmes do not have to be installed on multiple devices, nor do data have to
be saved back and forth.
The virtualisation and the electronic mobility of work promote, as already stated,
the flexibilisation of work. A German survey on the use of digital media at the
workplace shows that two thirds of the interrogated employees answer the question
whether digitalisation in the workplace has increased their working flexibility in
terms of time and space in the affirmative (Markgraf, 2018b, p. 22). The German
professional association “Die Führungskräfte” (DFK) examined the use of digital
media by executives in middle management (N ¼ 950) in 2013. According to the
results, nine out of ten (88.6 percent) of the executives surveyed believe that modern
communication options contribute to more flexibility in the job (DFK, 2013, p. 7).
Professional information can be called up or fed into systems anywhere and at any
time. Likewise, professional communication does not stop at the company’s gates,
but can be resumed at any time on the way home, at home, in the shopping centre or
at almost any location. For instance, a recent survey conducted in Germany, Switzerland and Austria shows that nearly a third of the employees interrogated (approx.
29.4 percent) have already answered work-related e-mails at the supermarket
(Markgraf, 2018a, p. 18).
One consequence of the flexibilisation is the acceleration of work processes (see
Koinig and Diehl in this volume). The following excerpt from an interview with a
sales and marketing manager conducted as part of the study on the mediatisation of
work illustrates this clearly. He explains that he has set up the communication
structure in his team in such a way that he can handle most of the processes using
the e-mail application on his smartphone and can react quickly to inquiries from his
employees, especially since he spends a lot of time on the road:
“[. . .] for example, we did it this way: when my salespeople write an offer [. . .],
then it is prepared so that it is created in Word format for the customer, and in the
subject line [of the e-mail addressed to him, CRE] there are the prices and the ‘Ok’,
and there [in the list of addressees, CRE] all the important people are included,
meaning the customer service, people who type it into SAP. I get it, I decide on it,
then just write ‘Ok’ back to everyone, and from that point on it is then entered into
SAP. [. . .] It is easy that I can confirm this just by smartphone, with an ‘Ok’ even
while driving, so that we have much faster decision-making processes, so that we do
not lose any time in the administration.” (Sales and Marketing Manager,
37 years old)
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C. Roth-Ebner
The quotation can be interpreted as evidence of the pursuit of efficiency, which is
a central result of the study. Digital media are the tools used in this quest for
efficiency (Roth-Ebner, 2016a). Richard Sennett describes flexibility as “time of a
new power” (Sennett, 1998, p. 59): “Time in institutions and for individuals has been
unchained from the iron cage of the past, but subjected to new, top-down controls
and surveillance” (Ibid.). With this quote, reference is made to the downsides of
flexibility and mobile work, which include new forms of control and increased
pressure to perform. Thus, as the study on the mediatisation of work showed, an
increase in available time through efficient work strategies does not lead to an
increase in leisure time, but to more work (Roth-Ebner, 2016a, p. 275). Similarly,
Markgraf (2018b, p. 27) found out that the individual workload in many cases has
increased along with processes of digitalisation.
7.4
Global Communication and Networking
Since the turn of the millennium, it is no longer just industrial production that is
handled globally, but also the highly qualified area of knowledge work (Boes et al.,
2012, p. 25). According to Andreas Boes et al. (2012, p. 26), this period heralded the
start of a new phase of globalisation: that of the globally networked economy.
Innovations in the area of information and communication technologies are closely
related to processes of globalisation, since on the basis of interactive network
communication, information is in principle available to everyone worldwide with
Internet access (Winkel, 2007, p. 242; Boes et al., 2012, p. 26). In this digitally
networked environment, globally distributed co-workers can be just one click away,
as a senior manager explained in the course of the study on the mediatisation of
work. He labels his instant messenger tool as “opening into the world, because from
that window I can call people, I can chat with them, I can phone them. It is all a
mouse click away” (Senior Manager, 41 years old).
A concrete form of global work is what is known as crowd working.3 In this form
of crowdsourcing, a large number of mutually independent persons are assigned a
task (Nickerson, 2014, p. 39). Orders can easily be advertised, placed, processed and
settled globally via web-based crowd working platforms. The resulting virtual work
networks provide an example for Manuel Castell’s (1996) theory of network society:
Networks constitute the new social morphology of our societies, and the diffusion of
networking logic substantially modifies the operation and outcomes in processes of production, experience, power, and culture. While the networking form of social organization has
existed in other times and spaces, the new information technology paradigm provides the
material basis for its pervasive expansion throughout the entire social structure. (Castells,
1996, p. 469)
3
For research on that, see exemplarily Schörpf et al. (2017).
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Work in Transition: Digital Media and Its Transformative Potential for Work
111
Accordingly, Lee Rainie and Barry Wellman (2014) call our society’s “social
operating system” the “network individualism” and emphasise in particular the
individuality of the action. This combines with digital networking and opens up
new opportunities for learning, the formation of relationships and working. The
corporate use of Web 2.0 such as social networks, wikis, weblogs and, above all,
combinations of these for organising communication, information and collaboration
under the keyword “enterprise 2.0” is an example of this (Carstensen, 2016; Koch &
Ott, 2015, p. 101). In fact, the cooperation can also be regional or local in nature,
since digital networking practices are also important in the geographical vicinity. For
example, a 31-year-old process designer interviewed as part of the study on the
mediatisation of work reported that she uses the instant messenger to communicate
with her colleagues who are in the same office as her.
Thomas Steinmaurer (2014) introduces the term “mediatised connectivity” to
explain the networking paradigm in current societies. He sees permanent connectivity as a new dominant dispositive of communication. By referring to Michel
Foucault, he points out aspects of power that consist in the interplay of economic
interests and technological potential. According to Steinmaurer (2014, p. 98), this
coupling, for example, leads to the commercialisation of private data and surveillance (see Mueller et al.; Hattenberger and Vidreis in this volume). The case of the
abovementioned process designer, whose duties include working for a service
hotline in her company, serves as an example for the latter. She states that the
(service) performance of the whole team is recorded by a software programme,
processed and finally translated into the salary bonus of the management. Hence,
work processes are automatically evaluated against efficiency, which has a financial
impact on the management. This illustrates the combination of technological innovations and economic benefits.
7.5
Blurring of Boundaries Between Private
and Professional Spheres
The flexible and mobile use of digital media contributes to a spillover between
professional and private areas of life, for example, in the form of e-mails or calls (see
Koinig and Diehl in this volume). Empirical studies show that the overwhelming
majority of employees can be reached by superiors, colleagues or customers outside
of their working hours (AK Niederösterreich, 2016; DFK, 2013, p. 6; Roth-Ebner,
2015a, pp. 193ff.). In most cases, this is done on a voluntary basis. According to
recent Austrian and German surveys, the availability for professional matters outside
of regular working hours is expected from just around a quarter of employees
(Deutscher Gewerkschaftsbund, 2017, p. 21; Deloitte, 2019, p. 7 as for
non-leading positions). If the expectation is further differentiated into an explicitly
expressed expectation and an implicitly perceived one, the results of the DFK study
already mentioned are revealing. Approximately two thirds (63.6 percent) of the
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C. Roth-Ebner
executives surveyed stated that the accessibility they expected was not expressly
agreed, while the expectation was explicit for just under three percent (DFK, 2013,
p. 13). Statements from the interviews for the study “mediatisation of work” reveal
that the employees feel latent pressure to remain available to the company. This is
connected, for example, to the fact that the company provides employees with
mobile devices or the fear of losing an assignment or even one’s employment
(Roth-Ebner, 2015b, p. 195).
Accessibility can be detrimental to employees. A negative influence of an always
on culture and work stress on health, motivation and productivity has been stated in
various studies (Haider, 2018, p. 42; Spieß, 2017, p. 38; DAK-Gesundheit, 2013,
p. 96). For example, workers with a high degree of accessibility have twice as many
symptoms of depression as people who have little or no availability
(DAK-Gesundheit, 2013, p. 96). Their recovery time can be disrupted, and they
may feel more stressed and have more difficulties to combine their private and
working lives (Albano et al., 2018, p. 214; Deutscher Gewerkschaftsbund, 2017;
see Koinig and Diehl in this volume). This is also indicated by the result that people
who are expected to have availability outside of working hours rate their working
conditions worse than employees who are hardly or not expected to do so (Deutscher
Gewerkschaftsbund, 2017, p. 18). As Roberto Albano et al. (2018, p. 215) suggest,
companies should support their employees, e.g. by limiting access to the company’s
digital services during certain periods. Such initiatives already exist, but they are rare
exceptions. For example at VW, e-mails are not forwarded after the end of the
working day.
However, it has to be stated that the “permeability between the two areas might
take place not only in the work-family direction but also in the opposite one, thereby
bringing the concerns and burdens of one’s private life into the work sphere”
(Albano et al., 2018, p. 212). One of the employees interviewed in the course of
the study on the mediatisation of work, a 40-year-old project manager, provides an
example for that: She compensates for her working hours in private by conducting
private chats in the office.
In addition to the accessibility issue, ubiquitous work in some areas is a normal
state, as Tanja Carstensen found out in her study on employees dealing with social
media. This is associated with both positive effects for a better compatibility of
private and professional life areas and increased demands on the time management
of the employees and the potential danger of an excessive workload (Carstensen,
2015, p. 189). In order to estimate the distribution of opportunities and challenges, a
recent survey conducted with German, Swiss and Austrian employees might be
instructive. There, twice as many employees indicated negative effects of
digitalisation for their work-life balance4 than positive (Markgraf, 2018b, p. 27).
Despite this result, it is difficult to make clear statements about the effects of
I stick to the term “work-life balance” as used in the survey; however I do not find it useful, since it
contrasts work and life. Yet, work is an essential part of life. Furthermore, the term “balance” is
strongly normative and, in my opinion, more of a myth than an attainable ideal state.
4
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Work in Transition: Digital Media and Its Transformative Potential for Work
113
digitalisation for the individual, since they depend on various framework conditions,
e.g. the family status, the kind of work, individual preferences, etc.
Corresponding to the ambivalent assessment of the delimitation, there are also
different patterns of action. Various studies point to heterogeneous ways of structuring the relationship between private and professional areas of life—from strict
separation and pragmatic mixing to the complete dissolution of boundaries. Tanja
Carstensen et al. (2013) have shown this for web-based employment of under 30s,
Anne von Streit (2011) for self-employed people in the Internet industry and
Caroline Roth-Ebner (2015b) for people who use digital media at work intensively.
The handling of boundaries between work and private life, the so-called boundary
management, becomes a central competence of the employees (Carstensen et al.,
2013, p. 40; Roth-Ebner, 2015b; Streit, 2011, p. 250ff.). The strategies range from
spatial demarcation to the distinction between professional and private devices and
so-called accessibility management (Roth-Ebner, 2015b, pp. 202ff.). The latter
means that conscious considerations are made with regard to accessibility for
professional matters and routines are developed. The case of a male sales manager
with two children (5 and 8 years old), who was interviewed for the mediatisation of
work study, serves as an example. He explains his contemplations as follows:
“Because I work at home a lot, it is not always easy for the children. [. . .] Well, at
about three p.m. many calls tend to come in. Then I am in the living room with the
children, but every five minutes someone calls. That is very hard for them. So, I keep
telling them when I come home: ‘I’m not quite here yet. I have to conduct many
phone calls during the next one and a half hours. Then I will switch it off, then we
can have our time together’.” (Sales and marketing manager, 37 years old)
As the quote might show, boundary dissolution processes require or force
decisions (Beck et al., 2004, p. 15). In times of an increasing individualisation,
these decisions are incumbent on the individual him- or herself (ibid., p. 22).
However, organisations are called upon to unburden the individual by establishing
rules and agreements they can rely on.
7.6
Subjectivation of Work
Along with the transformation from industrial society to knowledge society or from
Fordism to post-Fordism, the process of an increasing “subjectivation” (orig. German: “Subjektivierung”) of work is being asserted. The term “subjectivation” stands
for a targeted use of the human subjectivity for the work process (Kleemann, 2012,
p. 7). In contrast to Taylorist-Fordist concepts or the “employee subject” (orig.
German: “Angestelltensubjekt”) of the twentieth century (Reckwitz, 2006), forms
of employment that emphasise the autonomy and self-responsibility of the individual
are becoming increasingly important, be it through project-oriented work or the
shifting of responsibilities and risks to those working (e.g. through performancebased remuneration models, all-in contracts, one-person business, etc.). Along with
this process, the individual gains more importance. In one of his recent books,
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C. Roth-Ebner
Andreas Reckwitz (2018) describes his concept of “singularities”, which refers to the
abovementioned post-Fordist developments and emphasises the orientation towards
singularities in the world of work. Above all, this counts for highly qualified
knowledge work. As for Reckwitz (2018, p. 226f.), processes of digitalisation,
computerisation and networking are connected to this development. Examples are
conquering individualistic social network profiles, specific web communities and
data tracking, which allows personalised access to the web (ibid., p. 227).
Klaus Schönberger and Stefanie Springer (2003, p. 11) even see the spread of
computer technology (amongst other factors) as decisive for the increasing relevance
of subjectivity. The computer, as a medium that serves to communicate, always
requires subjective interpretations. Nearly two decades after the authors formulated
their thesis, this is all the more the case. Subjectivation is also closely related to the
flexibilisation of work, because subjective accomplishments of self-organisation,
self-regulation and self-reflexion have to be provided in order to configure the
flexible options (with regard to the temporal and local organisation of work, accessibility, etc.).
The subjectivation of work can be seen as a double process: Organisations on the
one hand increasingly place demands on the subjective performance of their
employees, but on the other hand the employees also make more subjective demands
on their work (Kleemann et al., 2002, p. 58; similarly Härtwig & Hoff, 2010, p. 30).
The effects of subjectivation are accordingly ambivalent: On the one hand, the
employees have the chance for more self-realisation and participation in the work
process; at the same time, however, this involves more responsibility and risk. A
security specialist who was interviewed as part of the study on the mediatisation of
work ideally represents both aspects. In the interview he indicates that he checks his
e-mails even while on vacation when there are urgent permits to process in the IT
system and his colleague, who is responsible for this as well, is also on vacation. As
he has an all-in contract, he does not receive extra pay for this. In this case, the
entrepreneurial self-responsibility of the employee benefits the company. Instead of
ensuring that delegation structures work, the matter is left to the employees to
organise themselves. Another example illustrates the security specialist’s own
demands on working subjectively. He sometimes uses the computer at home in the
evening to research basic knowledge for his work with the aim of improving existing
processes. According to him, he would not have the time to do this during general
working hours, nor does he have a mandate to do so. But the employee wants to get
involved in his free time in order to optimise procedures, and in the course of that he
realises himself.
7.7
Standardisation and Rationalisation
Autonomy and control, freedoms and constraints are not mutually exclusive in the
subjectivised world of work. Instead, as Christian Härtwig and Ernst-H. Hoff (2010,
p. 30) point out, they represent two sides of the same coin. Standardisation and
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Work in Transition: Digital Media and Its Transformative Potential for Work
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rationalisation processes are related to the globalisation of (service) work, as
Andreas Boes et al. (2012, p. 34) note in their study on the globally networked
economy. They describe globalisation as an immense push for standardisation and
illustrate this using the example of work in the global IT industry. In order to be able
to outsource services geographically (offshoring), these must be standardised and
made as comprehensible as possible. Accordingly, services become products that
can be sold arbitrarily. According to the authors, the massive standardisation going
along with offshoring leads to a new logic of thinking. In this regard, Boes et al.
(2017, p. 163) even allude to the term “digital assembly line” in high skilled
knowledge work.
Yet, rationalisation processes are also common in local working contexts, in order
to integrate self-directed work into organisational structures and control (Böhle,
2003, p. 138). The confusing work organisation in project-oriented work requires
increased reporting, which in turn contributes to the standardisation and
rationalisation of work. Actually, this is triggered by the low-threshold possibilities
of digital process recordings. Economic values and neoliberal market principles
encourage a key figure orientation, which is easily made transparent and disseminated by the technology available. So-called issue tracking systems are an example
of such tools. This is software that is used to standardise the processes within teams,
departments or organisations, thereby speeding them up and making them transparent. A “ticket” is created and actioned for each work process (e.g. an IT malfunction
or an order process). Connected via a network, entire teams have access to the same
system, which makes all steps of a procedure traceable and controllable (RothEbner, 2015a, p. 172). Such systems are also used by some of those interviewed in
the study on the mediatisation of work, for example, by a 30-year-old product
manager in the field of software design. From her office in Austria, she leads a
team of software developers whose jobs are located at a company location in Eastern
Europe. In this case, the issue tracking system serves to structure virtual collaboration and cross-border project management with the aim of maximum efficiency.
The flip sides of standardisation and rationalisation are, besides the strong
economic orientation, the already mentioned new forms of control through digital
work processes. According to Arnold Picot and Rahild Neuburger (2008, p. 233), the
employees hang on the electronic line in structures with digitally controlled management. This was empirically observed, for example, in the case of Taiwanese
journalists who are subject to the digital control of their superiors and whose output
is measured by a quantitative evaluation of the writing activity (Liu, 2006). In the
online survey of the mediatisation of work study, 43 percent of those surveyed also
stated that the professional use of digital media enables the company to control them
more closely (Roth-Ebner, 2015a, p. 243).
As already stated, the described processes of standardisation and rationalisation
do not constitute a counterpoint to the process of subjectivation. Neither do they
represent a form of Taylorisation, the aim of which was to eliminate the subjectivity
of the workers (Boes et al., 2012, p. 35). Particularly under the conditions of
standardisation, subjective activity is necessary in order to interpret unified processes
and to translate them into situation-specific solutions (Böhle, 2003, p. 135).
116
7.8
C. Roth-Ebner
Implications for Organisations and Their Change
Management
The developments described above reveal that organisations have to be flexible in
order to cope with ongoing rapid technological and media-communicative transformations. This creates higher demands in terms of change management (Albach
et al., 2015, p. 5). The role of the manager “shifts from that of the decision-maker to
the moderator of the change process” (ibid., p. 10), since change cannot be enacted
top down but has to be developed in a collective process. When it comes to the
question of how organisations can support their employees in an increasingly
digitally shaped and rapidly changing working environment, the key measures lie
in the area of the culture of the organisation. Central fields of action and design are
the pillars of IT and software equipment and design of digital work processes, further
development and the working environment. What recommendations can be derived
from the above-stated developments in office or knowledge work?
A digitally shaped work environment requires a corresponding culture of the
organisation. In fact, this is the most essential factor in managing mediacommunicative change in the workplace (Mitterweger & Wellhöfer, 2019, p. 83;
Schulz, 2019). By establishing a participatory culture with opportunities for direct
feedback and dialogic communication, the commitment and job satisfaction of the
employees can be fostered (Albach et al., 2015, p. 12).
Firstly, employers are encouraged to involve the employees in their individual
challenges and framework conditions in management and design processes. This
includes the decision about which hardware and software suit the needs of the
employees best and ensure fruitful collaboration. Moreover, work processes and
workflows should be established considering the requirements of the people working
with them. If organisations let their employees participate in decision and design
processes, they are more likely to accept new processes and tools. Moreover, it
accommodates the high relevance of subjectivity in digitally shaped knowledge
work as described in Sect. 7.6.
Secondly, advanced vocational training is becoming increasingly important in
times of digitalisation. Along with technological change, the half-life of knowledge
and skills is rapidly shortening. Expertise and technological skills require regular
updates. But also soft skills such as communication skills, space and time management, mindfulness, deceleration and reflectivity are important prerequisites for
mastering digitised work. The same applies all the more to managerial competencies,
which have to be kept up to date in times of fast technological progress (Diehl et al.,
2013). Appropriate further training can be done in part with the help of conventional
training programmes within the framework of courses and lectures. Given the
individual challenges for employees, however, more flexible measures tailored to
individual needs make more sense. For example, digital learning platforms and
applications allow time- and location-independent, even mobile learning. In
webinars (seminars conducted on the Internet), the participants can interact with
the course leaders and other participants. In the time after the webinar appointment,
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Work in Transition: Digital Media and Its Transformative Potential for Work
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course materials, for example, in the form of videos, audio files or texts, remain
online to enable additional employees to learn as well. Transparent processes within
the organisation, process descriptions and knowledge management solutions that can
be used on the intranet regardless of time and place and which are always kept up to
date are further important instruments for keeping employees informed.
Since having an ability does not automatically mean implementing it in action
(Chomsky, 1981, p. 226), approaches are useful that accompany the employees in
the workplace itself. For example, coaching and mentoring structures are suitable
measures to support employees with their specific problems. Another sensible
alternative is job rotation, which enables other colleagues to get to know coping
strategies.
Thirdly, a favourable working environment is essential to support employees with
their individual challenges. Digital technologies make it possible to work anytime
and anywhere (Internet connection provided), so that physical presence in the office
is no longer absolutely necessary. Being able to work from home on certain days
each week can be very motivating for employees and a family-friendly measure (see
Koinig and Diehl in this volume). As the previously stated has shown that permanent
availability is perceived by most employees as a burden, certain framework working
hours should be set. The goal should be a flexible and at the same time fair working
time management. If accessibility beyond working hours is necessary, organisations
should implement on-call services that are remunerated. In addition, framework
conditions must be laid down in guidelines for behaviour and company agreements
that regulate the handling of digital media and applications (e.g. in addition to the
accessibility question, the use of private devices for work and vice versa, the use of
private social media applications during work, etc.).
As far as the office space is concerned, a creative room environment is particularly helpful in a digitally shaped work setting that provides fixed, personalised
workplaces, but also offers team islands and open structures that promote the
collaboration of employees. It is important to provide a safe working environment.
This includes ergonomic conditions and IT security measures, also in the case of
remote working arrangements. Since screen work and predominantly sedentary
work as well as stress from work overload can cause health problems, health
promotion at the workplace must be given high priority (see Koinig and Diehl in
this volume). This should cover the physical, psychological and social dimensions of
health and can be implemented as part of further training measures. In addition,
financially supported massages, sports offers and guided relaxation as well as
exercise breaks are suitable measures to counteract the diverse burdens imposed
by a digital workplace.
Overall, it is important to promote autonomy, but still to provide a reliable
framework within which the employees operate. Finally, it has to be stated that in
times of fast technological and social change, these measures have to be viewed as an
ongoing project that requires permanent reflection on work processes and conditions,
further training and management processes. Accordingly, Albach et al. (2015) bring
up the term “Management of Permanent Change”.
118
7.9
C. Roth-Ebner
Outlook
In the digitally shaped worlds of work, which are becoming increasingly diverse and
individualised (Holtgrewe, 2014, p. 20), the effects of professional media use for
employees are, as has been shown in this chapter and elsewhere (Carstensen, 2015,
p. 188; Diaz et al., 2012; Moldaschl, 2010, p. 285; Pfeiffer, 2012, p. 27), ambivalent.
However, I agree with Sabine Pfeiffer (2012, p. 19), when she denies that digital
media have a role as important drivers of developments. Rather, they act as enablers
that facilitate certain practices. In fact, this happens under the predispositions of a
changing world of work. How these practices are implemented is a matter for the
individuals and organisations that define the framework for individual action. This
once again makes it clear that technological innovations can only be understood in
the social use they are put to (Matuschek et al., 2003, p. 139) and that the transformative potential of digital media is just a potential one that does not guarantee any
unequivocal effect.
Social practices are embedded in technological, social, cultural, economic and
political framework conditions. The neoliberal economic paradigm affects all of
these areas and represents a key framework for the phenomena discussed in this
chapter. The ideal type of neoliberalism is the entrepreneurial self, whose actions are
coined by market success and who has to organise him- or herself (Bröckling, 2016).
According to Roth-Ebner (2015a), the quest for efficiency is a central characteristic
of those working with digital media. This is why she introduces the term “efficient
person” as ideal type of a digitally shaped world of work. In fact, the efficient person
does not always achieve efficiency efforts, but any actions are based on them. When
asked about the importance of time, a female interviewee in the study “mediatisation
of work” replied: “You just have to organise yourself properly, or I have to organise
myself properly, and above all, it is me who is responsible for making use of it [the
time, CRE]” (Head of the legal department, 45 years old). In fact, this statement
illustrates their neoliberal stance.
Tanja Carstensen (2015, p. 190) draws attention to the political framework by
noting a gap between legal regulations and the reality of work. This is shown,
amongst other things, in the unresolved question of how the ergonomic equipment
of work environments in private or public spaces can be ensured in the face of
mobile work or how recovery periods can be guaranteed in times of an always-on
work culture (ibid., p. 192).
Against the background of new technological uses, policy makers and collective
advocacy groups as well as companies are constantly required to adapt the framework conditions for the work situations of individuals. However, a great responsibility lies with the individuals themselves, who have to find a way to cope at their
digitised workplaces. Studies also point to resistance practices in this context. This
includes deliberately not answering the phone or switching off the smartphone
during leisure, ignoring or deleting e-mails or dealing with private matters during
working hours to compensate for the high workload (Roth-Ebner, 2015a, p. 314;
Carstensen, 2015, p. 192).
7
Work in Transition: Digital Media and Its Transformative Potential for Work
119
Due to constantly new technological innovations and social transformation processes, the future of work cannot be foreseen. However, the Covid-19 crisis has led
to a caesura in the working situation of many organisations and employees. Abruptly
transformed practices and strategies might persist, albeit in diluted form,
e.g. resulting in an increased acceptance of working from home. Moreover, the
digitalisation of work might get a boost, since these days, new software and
applications and new solutions for virtual collaboration are being developed and
new practices are being experienced and incorporated. This again is the best example
for the intermediate relationship between technological innovation and social needs.
7.10
1.
2.
3.
4.
5.
6.
7.
8.
Exercise and Reflexive Questions
How is virtual work defined?
What are the enablers of flexible and mobile work?
How does Manuel Castells characterise the contemporary society?
What measures can an organisation apply to support its employees in terms of
digital work?
How do you evaluate the widespread belief that digital media lead to increased
working efficiency? You can also relate to your own experiences.
How do you evaluate software which tracks and records work processes
(e.g. ticketing systems)? Are they efficient work tools or new instruments for
control and surveillance?
What was your experience of the Covid-19 crisis in terms of working and/or
studying?
Imagine living in the year 2030. What will a knowledge workplace look like?
What work routine will have become established?
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Caroline Roth-Ebner is Associate Professor at the Department
of Media and Communications at the University of Klagenfurt.
Her research focusses on mediatisation, work in the context of
digitalization, youth and children’s media use, media biographies,
crossmedia and transmedia productions. For further information,
please see https://carolinerothebner.wordpress.com/.
Chapter 8
New Technologies and Organizational
Health: How Changing Requirements
of the Digital Workplace Compel Employers
to Think About Workplace Health
Promotion
Isabell Koinig and Sandra Diehl
Abstract Organizational health refers to an enterprise’s ability to operate effectively, grow sustainably, and adapt smoothly to change and can also represent a
competitive advantage. Hence, organizations that want to be healthy (and successful)
are called upon to allocate resources to increase both employee engagement and
employee well-being. By putting more attention and efforts toward determining
employees’ concerns as well as the health and well-being of their staff, organizations
are pushing themselves to be the best in the field and attract the best talents. The
present investigation seeks to examine the extent to which employees’ work engagement and well-being are facilitated by their employers, further scrutinizing the
impact of corporate measures on their work–life balance and health. Through
semi-structured qualitative interviews with 20 employees from two European countries, the potentials and limits of both employee engagement and employee wellbeing are addressed. Results suggest that no fixed solution exists; rather, employer
concern for health is perceived as an “add on.” In conclusion, study limitations and
directions for future research are discussed.
8.1
Introduction
New information and communication technologies (ICTs) have brought about
significant changes that do not leave organizations unaffected (see Roth-Ebner,
Chap. 7). Conditioned by the rise of the Internet and Internet-enabled services,
organizational members have multiple tools and services at their disposal to utilize
during their work, including emails, chat messages, etc. (Mathiassen & Sorensen,
2008). The main purpose of ICTs is concerned with fostering collaboration and
I. Koinig (*) · S. Diehl
University of Klagenfurt, Klagenfurt, Austria
e-mail: isabelle.koinig@aau.at; sandra.diehl@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_8
125
126
I. Koinig and S. Diehl
cooperation in joint projects, while also elevating organizational performance. New
technologies’ main function thereby lies in enhancing interaction among individuals
and groups, new forms of creativity, collaboration, flexibility, and interdependence
(Bobsin & Hoppe, 2015; Avanade, 2013; Lazazzara & Ghiringhelli, 2015). With the
rise of new technologies in the workplace, employees become more connected, and,
ideally, this connectivity results in improved communication and employee empowerment (Solis, 2014).
In recent years, the concept of the digital workplace has received an increased
amount of attention. Besides being disruptive, it creates a new employee experience
based on efficiency, growth, and development (Deloitte, 2016b), exceeding notions
of both the traditional intranet and the advanced intranet: while the contents of the
traditional intranet were very limited, only containing the corporate phone book and
corporate information as well as being used to distribute corporate news and policies,
the advanced intranet provided employees with numerous tools that fostered internal
collaboration and social business, as well as self-service applications (DWG, 2013).
The digital workplace’s repertoire is even more expansive, encompassing a plethora
of services (email, unified communications), devices (smart phone, tablet), and
storage spaces (cloud services). As such, the tool kit of the traditional workforce
has been expanded even further (DWG, 2013).
The new conceptualization of the digital workplace is one that is pervasive across
organizations; it is one that empowers employees and equips them with more
control—all against the background of a new technology-enabled infrastructure
that awards employees the opportunity to work independently of time and place
(Avanade, 2015; BMC, 2016). As such, the reference to a physical “place” has been
removed in the term workplace as location no longer matters (Forrester, 2016). This
new work environment is characterized by seamless access over a multitude of
devices, collaboration and networking, as well as by employee mobility (Capgemini,
2013; see Roth-Ebner, Chap. 7). In fact, 78% of companies are expanding their
mobile strategy internally and externally, while also creating a separate tablet
strategy (73%) that enables their workforce to access relevant data on the go
(Forrester, 2016). According to a poll by Forrester (2016), around 89% of all US
employees have at least one home office day per week; in consequence, work
becomes associated with a “function” rather than a “place.” Eighty-three percent
even claim to be able to do their job in any kind of location as long as they are
equipped with the right tools (Forrester, 2016).
In general, the digital workplace “is about transforming wherever you are into
your workplace” (BMC, 2016; also see Avanade, 2013). As a result, the boundaries
separating personal and professional lives increasingly blur, changing the way
employees connect, communicate, and collaborate (Avanade, 2013; Deloitte,
2016b). The introduction of ICTs affects job conditions, leading to work extension,
fast-paced work (work intensification), multitasking, and an increasing number of
interruptions (Green, 2004a; Maume & Purcell, 2007; Mano & Mesch, 2010;
Chesley, 2014). Work extension is facilitated once ICTs that are implemented to
ease work tasks are used outside of the designated “work zone,” being utilized by
employees in their free time as well, resulting in employees being “always on”
8
New Technologies and Organizational Health: How Changing Requirements of. . .
127
(Chesley, 2005; Duxbury et al., 2006; Ninaus et al., 2015). Work intensification, in
contrast, alludes to the fact that due to the promotion of ICT-related services and
tools, employees are somewhat pressured to work faster and more intensively
(Green, 2004b; Maume & Purcell, 2007).
8.2
Change Management and the Digital Workplace
Among practitioners, the notion prevails that an organization’s success stands and
falls with its employees (De Smet et al., 2014). Three important and far-reaching
trends have led employees to increase in relevance: the “war for talents” among
millennials, companies’ needs to attract highly skilled staff (especially with technical
know-how), and companies’ evermore transparent employer brands (Deloitte,
2016a). With LinkedIn proclaiming that “high quality talent has never been in
such fierce demand” (LinkedIn, 2012), companies have started to realize that talent
does indeed present an “asset” that is worth fighting for. Hence, employers are
increasingly called upon to preoccupy themselves with securing the well-being of
their workforce (Harter et al., 2002), allocating resources toward ensuring individual
health in the digital workplace (Collins, 2001; see Stein, Chap. 6). This request is
also supported by the United Nation’s Sustainable Development Goal 8, which urges
the promotion of “sustained, inclusive and sustainable economic growth, full and
productive employment and decent work for all” (UN, 2017). Employee well-being
can be maintained through concrete health-enhancing measures on behalf of both the
individual and organizations, which can help to develop and maintain a “sustainable
workforce” (Kossek et al., 2014) and a “healthy organization” (OHDDC, 2017). A
sustainable workforce, thereby, benefits from both employee engagement and workplace health promotion measures, which allow organizations to increase employee
well-being at work (Goetzel & Ozminkowski, 2008; Gurt & Elke, 2009). As part of
this human sustainability, employers “take the present and future well-being and
performance of their employees into account” (Van Engen et al., 2012, p. 646). This
sentiment developed in response to a changing notion of work and can be traced
back to Frithjof Bergmann’s New Work, in which individuals pursue a career path
that is built on gainful and meaningful employment (Bergmann, 2004).
As people become more empowered in the workplace, their demands have
undergone some transformations (Solis, 2014; Duperrin, 2013) and new work
roles arise (e.g., media literacy practitioners, technology scouts, or change managers;
Diehl et al., 2013), which need to be considered in modern change management.
These roles also require employees to possess a new skill set, comprising technological, communication, intercultural, and social competencies, among others (Diehl
et al., 2013). These trends take place in an ever-changing organizational environment and predominantly concern three areas, namely (1) organizational health and
employee engagement, (2) workplace health promotion (WPHP), and (3) work–life
balance (WLB).
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Organizational Health and Employee Engagement
Listed as the “ultimate competitive advantage” (Keller & Price, 2011), organizational health refers to an enterprise’s ability to operate effectively, grow sustainably,
and adapt smoothly to change (OHDDC, 2017). Moreover, it alludes to “the ability
of an organization to align, execute, and renew itself faster than the competition to
sustain exceptional performance over time. It comprises core organizational skills
and capabilities, such as leadership, coordination, or external orientation, that traditional metrics don’t capture” (Keller & Price, 2011, p. 3). Organizational health is
closely linked to employee engagement as employees are perceived as the organizations’ core assets and the focal points of the digital workplace as well (BMC,
2016), who should not only be attracted but also retained in the long run. Employee
engagement is perceived as “the emotional connection an employee feels towards
his/her employment organization, which tends to influence his/her behaviors and
level of effort in work related activities” (Business Dictionary, 2020). As such, it
refers to a company’s ability to proactively address all the issues uttered on behalf of
the workforce, including health, which represents one of the top three priorities
among employees of all ages (HBR, 2017; HR Executive, 2019). As employee
engagement exceeds traditional notions of corporate culture (i.e., how things are
done) by centering on employees’ perceptions and experiences of how things are
within the company, businesses are required to listen closely to employees’ expectations and work experiences, which are seen as the basis for organizational success
and growth (Deloitte, 2016a). While Bergmann’s concept of New Work focused on
the individual, Markus Väth expanded the original theory by integrating additional
components, such as employee competencies and “life blending.” As such, he took a
more person-centered approach (Väth, 2016).
Recently, a worrying observation has been made: “Workplace Trend: Stress is on
the Rise” (Forbes, 2019). The article cites a study that suggests that individual stress
levels “have risen nearly 20 % in three decades” (Korn Ferry, 2018). Another study
even reports that 94% of American workers experience stress at their workplace,
prompting the author to ask whether a stressful working environment presented “the
new normal” (Wrike, 2019). So, while it seems to be without doubt that stress in the
workplace needs to be explicitly addressed, not only by employees themselves, but
also by employers, employee health and appreciation need to go hand in hand.
It seems safe to say that employee engagement is seen as a prerequisite for
organizational health. According to Cacace et al. (2016), psychologically and
financially healthy organizations are defined as follows: (1) they set a clear direction
for their future and how they conduct themselves; (2) they execute well and have a
culture of high performance; and (3) they create a strong connection between
employees and the company by showing appreciation and bringing meaning to
work. This corresponds with a recent industry study, which determined a shift in
employee preferences: “What employees really want isn’t more money but better
benefits. They want to work at a place that is really organizationally healthy”
(Forbes, 2016, 2018).
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Thereby, health can be either directly linked to the organization and its healthpromotive capacities or extended to its employees (Decker & Decker, 2015; Ulich &
Wülser, 2018). The first aspect recognizes the organization as a place where individual health can be improved, describing it as an environment that has the potential
“for promoting and maintaining improved levels of health over time” (DeJoy &
Wilson, 2003, p. 141). On the other hand, employers are called upon to assist their
employees in successfully juggling the different domains of their lives without any
difficulties and tensions. Both forms of health support have been found to benefit the
organization in the long run (Universum, 2016; De Cieri et al., 2005; Carless &
Wintle, 2007). Contemporary change management should take both forms into
consideration.
8.2.2
Workplace Health Promotion
Increasingly, the workplace is recognized as a place in which employees’ health can
be improved (Larsen et al., 2015). Health—a process that can be influenced by both
the individual and the organization—can be maintained through concrete healthenhancing measures. As part of a modern change management that focuses on the
workforce respectively their individual needs, companies are required to listen
actively, create a healthy work environment, provide benefits that correspond with
personal needs, and engage their employees proactively in order to make their
organization thrive and convince employees that their business is the best place to
work. One way of achieving and strengthening identification is, besides employee
engagement, workplace health promotion (WPHP; Bernatzeder, 2018).
A recent survey produced evidence that WPHP measures are one of the top three
priorities among employees of all ages (ntiative, 2019). The European Network for
Workplace Health Promotion, together with the WHO, has defined workplace health
promotion as “the combined efforts of employers, employees and society to improve
the health and well-being of people at work. This vision of workplace health
promotion places particular emphasis on improving the work organization and
working environment, increasing workers’ participation in shaping the working
environment, and encouraging personal skills and professional development”
(ENWHP, 2020). This suggests that present-day “sustainable” health promotion is
regarded as a joint effort and “guided by a more holistic, positive concept of health
that views individual and collective health as a means to achieving a high quality of
life” (Noblet & Rodwell, 2010, p. 154; see also Ulich & Wülser, 2018; Decker &
Decker, 2015).
For some years, work was listed among the top three sources of stress (APA,
2017). Statistics from 2017 highlight that employees’ stress was due to the high
workloads they had to deal with on a regular basis (Statista, 2020). An additional
38% said that their job constituted their primary source of stress (Everyday Health,
2019). In most instances, work-related stress was found to also have effects on
individuals’ health, leading to sleep deprivation or mental health issues, among
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others (Yang et al., 2014; HBR, 2020). In fact, more than a quarter of US employees
are even at risk for experiencing a burnout within the next year (Wrike, 2019).
Given these concerning trends, employers have started to install programs to
improve employee health and prevent future damage. Workplace health promotion
has been linked to a variety of positive outcomes; for example, it has been found to
increase productivity, work morale, and overall employee well-being (Hart and
Cooper, 2001). Moreover, it can lead to reduced human resource development
costs, lower turnover rates, and greater employee satisfaction, further positively
shaping the corporate image (Zwetsloot & Van Scheppingen, 2007).
The dramatic economic changes of the past decades have changed the work–life
relationship dramatically, with some authors even claiming that the boundaries
separating private and work lives have been “eroded” (Appelbaum et al., 2006;
see Roth-Ebner, Chap. 7). Not only employees have to adapt, but also enterprises
have to provide solutions to these changed environments: they can thus either offer
additional services to help family caregivers in fulfilling their tasks or they can award
their employees more flexibility so that they can juggle the requirements of both their
work and family (den Dulk et al., 2000; Glass & Estes, 1997). In the first instance,
essential family services—like childcare or laundry services—are offered, while in
the latter case telecommunicating, compressed work weeks, and parental leave are
available to employees to award them with a greater degree of flexibility
(Appelbaum et al., 2006).
Companies are said to considerably benefit from this regulation, for employees
take fewer absences and are more likely to stay with the company, positively
affecting retention (Ostermann, 1995; Appelbaum et al., 2006; Almer & Kaplan,
2002). The availability of health-related services has also proven to have a direct
impact on organizational citizenship behavior and job satisfaction, together with
increased productivity levels (Lambert, 2000; Hill et al., 1998). As WPHP is
considered part of healthy leadership practice (Boehm et al., 2016), investments
have been found to pay off in the long run, rendering it a viable strategy to counteract
low employee morale (Solis, 2014).
For instance, as part of their workplace health promotion, employers could
implement measures or regulations that prevent work overload, offer healthy canteen
food, or further education possibilities, which all make for a good and healthy
working climate (Wiencke et al., 2016; Goetzel & Ozminkowski, 2008; Gurt &
Elke, 2009; see Stein, Chap. 6). In not only considering their employees’ personal
situations, employers are able to increase employee flexibility to balance the requirements of both their work and families, also equipping them with further knowledge
(i.e., in the form of training measures) that allows their staff to manage their time
more efficiently.
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8.2.3
131
Work–Life Balance
Stressful working conditions also have a tendency to spill over into employees’
personal lives. For example, 54% of the US population claims that stress from work
affects their life at home (Wrike, 2019) as well as their personal life (Korn Ferry,
2018). An increasing workload is usually conditioned by the fact that individuals
strive to gain their employer’s respect and recognition—defined as a basic human
need, according to the WHO (2018). In consequence, they purposely put up with
work-related stress, which is caused by being confronted with work demands and
pressures that exceed both their knowledge and abilities. As this work overload
contradicts the so-called “healthy job”—defined as the demands on employees being
appropriate in relation to their abilities and resources (WHO, 2018)—it comes as no
surprise that 43% of US employees think that their employers should care about their
work–life balance (APA, 2013).
One way of facilitating a more flexible work–life balance is increasing flexibility.
Flexible work arrangements (FWAs) have become more commonplace and
have often been used to indicate the employers’ sensitivity to employees’ needs to
manage both their lives at work and off work (Timms et al., 2014). Moreover, they
are reflexive of changing work structures, which have become more project-based
(Deloitte, 2016a). Thereby, work flexibility can take a variety of forms, such as
flextime, compressed work weeks, part-time work, or working from home (“home
office”; Allen, 2001; Brough et al., 2005). Since employees are enabled to more
efficiently manage the demands of family and work life (Allen, 2001; Brough et al.,
2005), flexible work solutions are seen as part of a supportive organizational culture
(Timms et al., 2014), which can boost an organization’s image in the eyes of present
and potential employees (Carless & Wintle, 2007) while also increasing employee
happiness (PWC, 2016; see Roth-Ebner, Chap. 7).
Having turned out to benefit organizations (De Cieri et al., 2005; Carless &
Wintle, 2007), the concept of work–life balance refers to an individual’s capabilities
to manage and successfully juggle the different domains of their lives without any
difficulties and tensions. In detail, it alludes to “the level of prioritisation between
personal and professional activities in an individual’s life and the level to which
activities related to their job are present in the home” (HRZone, 2017). As such, this
conceptualization pays tribute to the fact that people’s work and nonwork spheres
are interwoven entities and cannot be seen as separate from one another (Kanter,
1977; Appelbaum et al., 2006). In order for flexibility to become realized, an
organizational culture ought to be of a supportive nature. According to Dikkers
et al. (2004), supportive cultures do not only factor in work-related aspects but also
accommodate nonrelated aspects that benefit employees’ very own needs, positively
affecting work climate and employee satisfaction (Denison, 1996; Parker et al.,
2003; Behson, 2005; Timms et al., 2014). Employers have started to offer additional
services, with certain companies implementing a vast pallet of offerings [e.g.,
Facebook’s benefit package includes New Parent Benefits, extended vacation and
sick leave, free meals, paid health insurance, on-site services (dry cleaning, barbers
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and hair dressers, gym, etc.); Facebook, 2020]. Showing employee appreciation
seems to literally pay off in the long run as corporate incentives have been found to
have a positive impact on organizational citizenship behavior and job satisfaction,
further resulting in increased productivity levels (Lambert, 2000; Hill et al., 1998).
8.3
8.3.1
Empirical Study
Method
The empirical investigation seeks to investigate the extent to which employees’ work
engagement and well-being are facilitated by their employers, further scrutinizing
the impact of corporate measures on their work-life balance and health. Interviews
were conducted over the course of 2 months. Each interview was fully transcribed.
The transcripts served as the basis for our qualitative content analysis and were then
analyzed using QCAmap. By use of 20 semi-structured qualitative face-to-face
interviews (females: 12; males: 8; age range: 22–57 years) with employees from
Germany and Austria, the present project seeks to investigate how organizations
address the changing priorities uttered on behalf of their workforce in their change
management. The respondents worked in a variety of industries, such as tourism,
banking, IT, and security. The majority of respondents (n ¼ 17) did not have a
management position.
8.3.2
Study Purpose
The focus of the empirical study concerned employee engagement and employee
well-being in the digital workplace. Especially against the background of a growing
mediatization, which leads to blurring boundaries between employees’ private and
professional lives and to an always-on-mentality among many employees, individual
health is repeatedly put to the test. In consequence, the maintenance of a sound
work–life balance is becoming more and more important, as is the introduction of
flexible work solutions, which can improve individual well-being in the long run.
Besides individual strategies of dealing with this dichotomy, interviews are meant to
determine whether employees feel that companies increasingly step up and recognize the workplace as a place where individual health can be enhanced. As such, it is
proposed that organizations draw from their health-promotive capacities. Thus, the
purpose of this study was twofold: on the one hand, it inquired individuals’ familiarity with the term employee engagement as well as corporate employee engagement strategies and potentials. Building on the concept of engagement, the study
was, on the other hand, concerned with determining employees’ knowledge of the
term work–life balance as well as the strategies utilized to achieve such. Thereby, the
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relevance of individual as well as organizational strategies to optimize individual
and organizational health was determined.
8.4
8.4.1
Results
Employee Engagement
The study was able to underline that, overall, employees proclaimed to be familiar
with the term employee engagement. This corresponded with their abilities to define
the term. Definitions ranged from “a company culture which is based on trust so that
everyone can be open and honest without being punished” (male, 47, transport
industry) to a work environment that “takes individual preferences into consideration, which might be based on generational differences” (male, 28, engineering).
Moreover, employee engagement was seen to be linked to organizational appreciation: “I see that my work is taken into consideration, it is appreciated and criticized,
and all of this makes me think that I am doing something important for the company.
This stimulates me to do more and better” (female, 25, graphic design). Employees
who had been with their employers for a longer period of time stressed the changing
nature of employers’ relations with their staff, indicating that in modern change
management employees play a central role: “In the past, it was a very hierarchical
system in most companies as well as in governments and so on. This has changed
drastically. Nowadays you really want to maximise the potential of your whole team
and every employee, which means you need to consider all these different kinds of
angles and views and then make the decision. The manager still has the decision
power, but unlike twenty years ago, when he just decided based on his experience
that that’s the way we do it, he or she really tries to get the balance right between
what do the different employees think and their own opinion in order to hopefully
come to a better decision. Therefore, it’s absolutely crucial to hear what your
employees have to say” (male, 47, transport industry).
While the relevance of employee engagement was valued by employees of all
ages and regardless of their industrial background, the majority acknowledges the
ability to engage all employees. When asked about concrete examples, one lawyer
emphasized the possibility of exchanges as a fruitful strategy: “We have a so-called
jour fixe . . . where everybody sits together. . . and we talk about how everybody is
feeling, and what are the plans for the next weeks. This is very helpful” (male,
24, lawyer). Other strategies involved individual development (male, 28, IT industry), advanced training (e.g., in the form of individual coaching or Webinars) (male,
40, sales director; male, 57, banking), social activities (e.g., skiing trips, events)
(female, 22, marketing), or even financial incentives (e.g., boni) (female, 39, IT
industry). In order to find out what employees appreciate and how they can be
engaged, some corporate effort was required, such as surveys and feedback (male,
40, sales director).
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I. Koinig and S. Diehl
Workplace Health Promotion
Employees’ concern for their health is on the rise, as are calls for employers to take
responsibility for individual health. While ideas as to how health can be improved in
the workplace were somewhat inconsistent (male, 28, engineering), respondents
indicated that they appreciated what they had been offered so far. Corporate
WPHP measures comprised but were not limited to free fruits and vegetables
(female, 22, hospitality), free health checks and vaccinations (female, 24, education),
comfortable chairs and a pleasant office atmosphere (female, 39, IT industry), as
well as gym classes/membership for free or at a reduced fee (female, 24, education).
In addition, flexibility in terms of working hours was highly appreciated (male, 28, IT
industry), which will be discussed in the upcoming section.
8.4.3
Work–Life Balance
As was the case with employee engagement, respondents were not only familiar with
the term work–life balance but also did not fail to express the importance of
achieving a work–life balance. Overall, employees agreed that the extent to which
achieving a work–life balance is possible was not only dependent upon the industry
they worked in (male, 32, hospitality; female, 42, service industry), but also required
both individual and corporate efforts (male, 40, sales director).
Separating the professional from the private domain was seen as essential, with
one employee proclaiming that “it is very important for me to separate these two”
(male, 24, lawyer). While it was easily possible for some employees, who did not
have the possibility to access work-related information from home, to claim that
“you leave the office and only think about work when you come back the next
morning” (female, 39, IT industry), others, however, were forced to take drastic
measures to ensure that their work and private lives did not interfere with each other:
“I got myself a private cell phone” (male, 40, sales director).
The largest proportion of employees indicated that separating their private from
their professional lives was quite challenging, stating that “with the modern technologies, it is very hard” (male, 47, service industry). Respondents confirmed that
work was a central component of their private lives, forcing them to decide to
integrate work-related aspects into the home sphere. This required some changes,
but “at a certain level, you can adjust your life around the company” (male, 40, sales
director). The same person also confirmed the influence of new technology on his
work–life balance, highlighting that the two spheres were “more and more
connected because with these new tools, like mobiles, where you get your emails,
it gets more complicated to really disconnect” (male, 40, sales director). This also
held true for an employee from the banking industry, who observed: “In selected
cases, you cannot escape it. Your work will influence your private life and your
family will feel that you are not content and preoccupied with job-related matters”
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(male, 53, banking). In extreme cases, even vacation time was interrupted to deal
with job-related issues: “For example, I went on my honeymoon and they called me
for help. So yes, you can say that I am not able to separate the two areas” (male,
28, engineering).
The aspects presented above indicate that most employees were aware of the fact
that achieving a balance between their personal and professional lives required
individual effort. Only in selected cases they could count on their employer to
implement supportive measures. One employee stated that his company offered
him some additional flexibility after he had become a parent (e.g., extra parental
leave or home office time) (male, 28, engineering), while similar measures were also
reported by a service industry worker: “They give you extra vacation, up to 2 days a
year, so you can do good social things like helping in the kindergarten. They also
give you an extra day for your birthday which you can use flexibly—meaning you
have plus/minus a week to take it” (male, 47, service industry). These incentives,
however, do not present the norm yet.
8.5
Discussion of Results
The present investigation was able to demonstrate that the concept of organizational
health and employee engagement is linked to one another, with the latter potentially
serving as an added value in the war for talent (Deloitte, 2016a) as well as taking new
conceptualizations of work and shifting priorities into account (Bergmann, 2004;
Väth, 2016). These changes also correspond to the changes brought about by Work
Culture 4.0 (EPSC, 2016) and Work 4.0, respectively (Salimi, 2015). The present
survey showed that while employee engagement was well-perceived by the respondents, agreement was also reached as to the fact that one solution does not fit all the
requirements of an evermore diverse workforce. As the workplace is undergoing
some rapid changes, employees’ needs and priorities are shifting, too, which might
be conditioned by the broader set of skills required in the digital workplace (Diehl
et al., 2013) Hence, in order for employers to tap into the pulse of time and meet
changing requirements in the workplace, employees’ concerns need to be determined in advance, which can be mutually beneficial and help create a supportive
work environment (Timms et al., 2014; Keating & Heslin, 2015). Change management strategies and tools should definitely consider these needs (see Stein, Chap. 6).
Moreover, the study confirmed that employers have started to recognize the
potential of the workplace as an environment, where individual health can be
enhanced (Larsen et al., 2015). Besides introducing health-enhancing corporate
measures and tools (including free food, gym memberships, and ergonomic equipment), granting employees more flexibility as to when and where their work is done
was seen to benefit employees’ work–life balance (Larsen et al., 2015). This aspect is
also addressed by Väth (2016), who found that employees reevaluate the importance
of work against the background of their changing lifestyles and values. As
employers are starting to take employees’ individual concerns into account, they
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are expanding their offerings from on-site services to more flexible off-site solutions,
which have been found to lead to a number of positive effects, including boosted
productivity, reduced absenteeism rates, etc. (DeJoy & Wilson, 2003). Yet, progress
is slow and, as of now, employer concern for employee health and well-being is an
add-on rather than a given; and while corporate effort is slowly surfacing, respondents are aware that organizational support has been limited so far. At present,
companies are likely to delegate responsibility for both their health as well as a
healthy work–life balance to employees (male, 53, banking), who are called upon to
implement steps and measures to achieve balanced work–life relationships. If
organizational culture is truly supportive and understanding of employees’ needs,
new and more encompassing solutions need to be developed to guarantee organizational health and a sustainable workforce in the long run. This also corresponds with
the WHO’s call to establish a “culture of health and well-being,” which is supported
by “the institutional, social and physical environment” (Davies et al., 2014) and must
be an essential part of a sustainable, up-to-date change management (see Koinig
et al., Chap. 27).
8.6
Limitations and Directions for Future Research
The present study presented a pilot project and was, as such, based on a relatively
small sample size. Even though some interesting results surfaced, it might be
interesting to conduct a deeper analysis of findings, taking aspects of respondents’
sex, age, and industry background into account. It might also be worthwhile to
examine how employees who have been with the company for a longer period of
time evaluate changes toward the digital workplace; likewise, it might also be
interesting to investigate their perceptions of corporate efforts with regard to
employee well-being and health. The study by Ninaus et al. (2015) was able to
show that especially employees in the media industry are suffering from very high
stress levels, which renders WPHP measures taken by companies even more important. Future research might also consider expanding the study context to other
countries and comparing countries along the dimension of their employee representation (for further information, Koinig and Weder, 2021). Likewise, it might be of
relevance to also include the employer perspective in an attempt to uncover how
companies deal with a diverse, multigenerational, and mobile workforce, whose core
interests lie in creating flexible, employee-centric work environments.
8.7
Exercise and Reflexive Questions
1. How is the concept of organizational health defined, and how is it linked to the
concept of employee engagement?
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137
2. To what extent has the digital workplace contributed to the rise of organizational
health?
3. What can organizations do to increase their employees’ well-being and health
both inside and outside the physical workplace?
4. How might requirements differ by gender and age?
5. Take a look at some organizations of your choice and find out if they support their
employees in achieving a work–life balance.
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Isabell Koinig is a Postdoctoral Researcher at the Department of
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mHealth, health for sustainable development, and wearables),
intercultural advertising, organizational health, as well as media
and convergence management. For further information, please see
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Sandra Diehl (PhD, Saarland University, Germany) is Associate
Professor and Head of the Department of Media and Communications at the University of Klagenfurt, Austria. Her research
interests include CSR and health communication, international
and intercultural advertising, as well as media and convergence
management. For further information, please see https://www.aau.
at/en/media-and-communications/team/assoc-prof-dr-sandradiehl/
Chapter 9
Managing Brands in an Ever-Changing
Media Environment
Tobias Langner and Tobias Klinke
Abstract Today’s media environment is characterized by dramatic changes. For
brand communication, it is more difficult than ever to reach consumers. Notably
though, despite all the radical changes in media consumption, the psychological
principles of managing brands have not changed as human brains have evolved over
millennia, rather than merely during the last decades. Thus, brands still have to
communicate a relevant and differentiating positioning in every consumer–brand
interaction. In order to design effective communication, brand managers have to
ensure that the communication gets sufficient attention, elicits positive emotions,
conveys the relevant information, and establishes brand knowledge in consumers’
minds. This chapter provides a comprehensive set of communication tactics that help
to design effective brand communication in today’s dynamic media environment.
9.1
Introduction: Today’s Dynamic Media Environment
Consumers spend considerable amounts of time sending and receiving messages,
and digital media have a central role in these efforts. The smartphone is within most
users’ reach (91%), usually all day (Edison Research, 2012), so consumers are on
permanent standby, nearly always reachable. They access the Internet more frequently through mobile than stationary devices (Comscore, 2019), and the introduction of smart watches and other wearable technology enables even more constant
access to the digital world.
In turn, existing distinctions of three screens—television, computer, and
smartphone—are no longer relevant for consumers, who access the same media
content through all types of screens. Smart televisions offer Internet access;
smartphones offer streaming services; and desktop computers are multimedia
devices that support nearly every conceivable form of media (see Diehl et al.,
Chap. 11). Tablets represent a fourth screen, with features borrowed from the
T. Langner (*) · T. Klinke
Bergische University Wuppertal, Wuppertal, Germany
e-mail: langner@wiwi.uni-wuppertal.de; klinke@wiwi.uni-wuppertal.de
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_9
143
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T. Langner and T. Klinke
other channels. Furthermore, consumers can switch channels in mere moments to
such an extent that the different channels even come to merge in a trend known as
convergence. In media contexts, convergence implies integration of previously
separate media forms and technologies (Brüggemann, 2002), such that the boundaries between different media genres become increasingly blurred in the context of
their use.
Examples of such media convergence are widespread. Consumers who carry their
smartphones hold on to a complex media and shopping center, providing access to
any information sourced from anywhere, as well as whatever goods or services they
might desire, at any time. In turn, media convergence challenges traditional ideas
related to brand-to-consumer communication (e.g., Muntinga et al., 2012; Schultz
et al., 2012), especially when consumers produce brand-related content on their own.
They connect with other consumers on various platforms and express their opinions
about brands in extended comments, rather than just being passive recipients of
brand communication (see Terlutter & Ninaus, Chap. 13). Such cultural changes
apply to consumers in various social and demographic categories, which in turn have
considerable influence on brand images. Therefore, beyond their ongoing efforts to
integrate offline and online media successfully, brand managers must deal with the
challenge of managing consumers’ communications about their brands.
Considering that the way people consume media has changed dramatically in the
past two decades, and the present-day media environment continues to be characterized by changing conditions, with a “rate of change in modern times . . . greater
than ever” (Al-Ali et al., 2017, p. 724), several central questions arise for brand
managers. How can they deal with dynamic media consumption? Do the principles
of brand management need to change, considering the changing conditions surrounding media consumption? To derive an answer, we seek to provide an overview
of fundamental changes in media consumption and their implications for brand
management.
9.2
9.2.1
Changes in Media Consumption Contexts and Impacts
on Brand Management
Key Changes in Media Consumption Contexts
The Internet created a virtual world, parallel to the real one, and changed consumption and communication cultures (Jenkins, 2006). Information about nearly everything imaginable became ubiquitously available, though early developments still
took the general form of unidirectional, mass communication. Consumers gained
access to information on websites provided by brands, organizations, or individuals.
Then Web 2.0 transformed the character of Internet communication by instituting a
participatory social medium. Anyone online can share information throughout the
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world within seconds, such that “in the world of media convergence, every important
story gets told” (Jenkins, 2006, p. 3).
Digital Immigrants Versus Digital Natives The extent to which consumers leverage the opportunities provided by Web 2.0 varies greatly across age groups. In
general, consumers prefer to use media with which they have been socialized, so
those who grew up mainly with print media and television spend significantly more
time with these media channels than consumers who have had digital access all their
lives (e.g., Marktforschung Ressort im BVDW, 2018). In terms of communication
culture, a common distinction refers to digital natives versus digital immigrants
(Prensky, 2001a, b; Wippermann, 2010; Ahn & Jung, 2016). Digital immigrants
were born before 1980 and grew up in a world dominated by print media and
television. Digital natives, born in 1980 or later, have grown up with the Internet,
mobile phones, and modern computer games, and they spend a considerable part of
their lives on the Internet. In turn, many digital natives willingly share private
information about their lives, relationships, memories, fantasies, and desires online,
as well as regularly generating new web content in areas of interest to them (Jenkins,
2006; Wippermann, 2010). The business models adopted by platforms such as
Facebook, Instagram, Snapchat, WhatsApp, YouTube, TikTok, or Flickr facilitate
such changes in communication culture (see Schwarz & Gustafsson, Chap. 3).
Digital immigrants instead are more reluctant to share personal information and try
to protect their privacy (Wippermann, 2010; see Hattenberger & Vidreis, Chap. 14).
Even if they use the Internet intensively, digital immigrants produce significantly
less content than digital natives. According to Wippermann (2010), digital immigrants will always remain guests in the digital world.
Multitasking Technical developments allow consumers to use media in new ways,
such that they are constantly multitasking. They divide their attention among
different online and offline media, as well as across varied content and different
activities (see Diehl et al., Chap. 11). Through multitasking, they execute different
activities more or less in parallel. For example, consumers listen to the content on
their televisions while surfing the Internet on their tablet and perhaps chatting with
their spouse in person; none of these activities receives their full attention.
According to Kraushaar and Novak (2019), US undergraduate students engage in
substantial multitasking behavior during lectures, such as using their laptops for
unrelated activities, about 42% of the time, which then hinders their academic
performance. Smartphones have been especially influential in facilitating more
multitasking, such that nearly constant usage of smartphones can be observed in
various activities and situations throughout the day (Mindberry, 2015) (Fig. 9.1).
Casual Communication Marketing communication thus is increasingly directed at
less involved, highly distracted consumers. Low exposure probabilities, short exposure times, and minimal cognitive involvement with advertising messages are
characteristic of most customer contacts. For example, when searching for something on a web page, consumers consider banner advertisements for an average of
only 1 s, if they view them at all (Langner et al., 2014). On social media platforms,
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T. Langner and T. Klinke
Fig. 9.1 Smartphone usage during various daily activities (sample: 258 smartphone users in
Germany, Austria, and Switzerland). (Source: mindberry Consulting GmbH (2015), mindberry.
com)
the situation is similar: a consumer scrolling through a news feed on Facebook
spends 1.7 s with each piece of content on mobile devices and 2.5 s on a desktop
computer (Facebook, 2016); those times are even shorter among younger audiences
(Facebook, 2016). The same holds true for offline customer contacts. A one-page
advertisement in a consumer magazine (e.g., Cosmopolitan) tends to be considered
for approximately 1.8 s (Institut von Keitz, 2016). Outdoor advertising that consumers encounter in flowing traffic indicates average exposure times of just less than
1 s. Moments of intensive engagement with marketing communication are rare,
occurring mainly when consumers already exhibit high levels of brand or product
involvement, such as in prepurchase and purchase phases.
Social Networking and Participation Socially connected consumers undertake
most of their media-based social interactions on social networks such as WhatsApp,
Facebook, Instagram, Twitter, Pinterest, Tumblr, or Snapchat, as well as on specific
blogs. Facebook, for example, attracts an average of 1.66 billion active users per day
worldwide (Facebook, 2019). Extensive social networking in turn leads to extensive
consumer participation and vast opportunities to disseminate information rapidly.
Within just a minute, 500,000 tweets get sent on Twitter, and 277,777 stories are
posted on Instagram (Domo, 2019). All this user-generated information contains
numerous brand-related posts, such that consumers recommend brands to their
friends, report on positive or negative experiences, share pictures of products and
brands with others, and create brand communities. Apps such as Hootsuite accelerate
the pace of content distribution by allowing users to post an entry on different social
media sites at the same time. Brands in turn experience large-scale effects of usergenerated content, both positive and negative (Christodoulides et al., 2012; Mayrhofer et al., 2020), and they cannot exert full control over communication about
their brands (Mangold & Faulds, 2009; Kaplan & Haenlein, 2010; Bal et al., 2017).
Whereas in the past companies could make decisions about what would be communicated, today they must accept that brand-related information comes from users,
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beyond their control. A single consumer can disseminate information to vast numbers of other consumers, with considerable influence on brand images.
Continuous Content Flow The continuous flow of content across different media
channels is another key feature of contemporary media consumption contexts.
Brand-related content can be distributed across the web, regardless of who produced
it; content produced by entity A can be distributed by entity B, even without A’s
knowledge. Such sharing usually is uncontrollable and irreversible. Duh et al. (2016)
offer a notable example: a college student named Dino Ignacio published, on his
website, a photo collage he made, showing Bert from Sesame Street next to Osama
Bin Laden, part of an art project he called “Bert Is Evil.” The content, created on his
PC, underwent flow in a connected media world though, such that Ignacio was
surprised to see his collage reproduced on anti-American protest signs in Pakistan
during a CNN report. These contents traveled around the world via the Internet and
found their way back, through another media channel. Similarly, brand information,
whether from the brand itself or from users, can be spread, distributed, and multiplied, especially if that content is of interest to consumers.
In order to make the various changes in contemporary media consumption
contexts manageable, a superordinate structure is required that takes into account
which behaviors have a potential impact on brands. The psychological variable
involvement is known to have a strong impact on consumer behavior and can
therefore be used to offer a structured overview of brand-related activities in today’s
dynamic media environment. Thus, the next section provides a classification of
brand-related activities based on involvement.
9.2.2
Classification of Brand-Related Activities
in Contemporary Media Environments Based
on Involvement
Consumers differ in their brand involvement. Involvement can be differentiated by
level (low versus high) or type (affective versus cognitive) (Kroeber-Riel & Esch,
2015). The intensity of brand involvement can also vary over time, such that it
increases before and during the purchase decision but decreases after a product has
been bought. Brand involvement also informs the situational impact in terms of
whether a consumer engages in brand activities at the moment he or she comes into
contact with the brand. This so-called situational involvement overrules enduring
brand involvement. Involvement can also be considered as a “super variable” that
influences the consumer behavior. It determines, for example, whether and how
consumers search for information, perceive and process brand-related content, and
engage with a brand.
How Does Involvement Affect Media Usage? Situational involvement determines
how consumers use different media. Gall and Hannafin (1994), in their study of
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Fig. 9.2 Consumers’ brand-related activities based on levels and type of involvement
hypertext, differentiate browsing and searching forms, such that searchers actively
look for (brand-related) information and exhibit greater involvement. The quality
and structure of information is important for persuading these consumers. Browsers
instead have no search target and wander through media, mostly to satisfy affective
needs such as having fun or being entertained. Browsers may stop and engage in an
activity if their attention is attracted, so that they can transform into searchers if their
involvement increases. Similarly, searchers can become browsers once they stop or
interrupt their search.
How Does Involvement Affect Brand-Related Activities? The level of brand
involvement determines the extent to which consumers engage in brand-related
activities. Muntinga et al. (2011, 2012) distinguish three brand-related activities
online: consuming, contributing, and creating. Less involved consumers primarily
consume, scan information provided on the brand’s website, watch brand-related
videos on YouTube, play advergames, or view posts by other users. Contributing
and creating instead require more involvement. In the former case, key activities
include becoming a member of a brand’s fan page, commenting on other consumers’
posts, or engaging in product ratings. The latter features the generation of complex
content, such as brand-related videos or articles (Muntinga et al., 2011).
How Do Consumer Motives Affect Brand-Related Activities? Combining the
different qualities and levels of involvement (Muntinga et al., 2011) produces a
matrix of six ways consumers can engage in brand-related activities (Fig. 9.2), such
that their consuming, contributing, and creating might be driven by cognitive or
affective motives. Emotionally involved consumers, for example, may take part in
brand-related crowdsourcing activities, such as designing burgers with McDonald’s
or inventing new flavors of potato chips for Lay’s. More cognitively involved
consumers likely rate products and brands. With higher brand involvement, consumers are more likely to get involved in creating. If they are highly emotionally
involved, they might produce a brand-related movie or commercial. If instead they
are more cognitively involved, consumers may write extensive product reviews.
Still, overall, consumers seem rather passive. The median engagement rate per
post on Facebook across all industries is 0.09%, so less than one in a thousand of all
active followers of a brand like, comment, or share a post pertaining to that brand
(Rival IQ, 2020).
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Fig. 9.3 Customer journeys for low- and high-involvement products
How Does Involvement Affect the Customer Journey? Customers want to reach
brands conveniently through any channel they use. Therefore, brands must facilitate
simple switches across channels, as well as link the channels in such a way that the
customers’ information and decision-making processes are supported. For most
customers, the customer journey begins with disinterest. They are not very involved;
their need for the offer does not yet exist. For example, many young people are not
(yet) interested in insurance products, furniture, or cars, which are not yet relevant.
Nevertheless, brand managers want to anchor their brands in these consumers’
minds at an early stage to build sufficient awareness and a positive brand image.
Then, when the need arises, the brand will be seen as a relevant buying alternative.
Unknown brands usually cannot enter decision-making processes due to the lack of
familiarity. In low-involvement phases, reaching the uninterested target group
requires mass media contacts because they will not be pursuing an active search of
communication channels. In this formative phase, the aim is to introduce the brand
into the minds of the target group through expansive, numerous mass media contacts
(Fig. 9.3).
Typical Customer Journey, Highly Involving Product As soon as the reason for a
purchase is manifested in the consumer’s mind, involvement increases, and the
purchase process begins. The course of the subsequent customer journey depends
largely on perceived purchase risk. If customers consider the risk of making a bad
buying decision very high (e.g., purchase of cars, notebooks, or insurance policies
for retirement), they undertake extensive product examinations. High purchase risk
tends to be associated with economic risk or strong emotions. Consumers often
adopt the so-called RoPo procedure: Research online, Purchase offline. Customers
obtain vast amounts of information on the Internet, but then buy in stores, often
through a personal sale. Personal contact with employees can help dispel perceived
uncertainty. As Langner et al. (2011) show, even young, Internet-savvy customers
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follow a RoPo progression when purchasing insurance products, such that they seek
personal contacts to increase their trust in the brand. Personal sales often prompt
further, high-involvement contacts. Consumers can also use brochures, websites,
forums, or price comparison engines to obtain risk-reducing information. Such a
customer journey usually occurs when customers are highly involved.
Typical Customer Journey, Less Involving Products Customer journeys proceed
differently if the purchasing decisions feature low involvement. Such decisions are
made with less cognitive depth. The search for information and the comparison of
alternatives are superficial at best. High-involvement media are barely used, and
consumers perceive little purchase risk, whether because they already have extensive
purchasing experience in the product category or because the purchase is not
associated with any substantial economic risk (e.g., habitual purchases, low-priced
goods) or strong emotions. Awareness and a positive brand image likely are sufficient to get a customer to visit a brand’s website while also watching television one
evening, perhaps triggered by broadcast advertising, or even to evoke a spontaneous
purchase, without any direct personal interaction with the brand (Fig. 9.3). Customer
journeys involving low-involvement products usually include a series of
low-involvement contacts prior to the purchase decision, usually made quite quickly.
9.3
Strategies and Tactics to Manage Brands in Changing
Media Environments
Dramatic changes in communication culture arguably indicate that the basic principles for building and managing brands have also changed. Yet human brains have
evolved over millennia, such that consumer behaviors reflect enduring influences;
human evolution is not accelerated by media convergence. The way consumers
perceive, process, and encode advertisements has not changed. Thus, most strategies
and principles established for offline advertising still hold true for building and
managing brands in changing media consumption environments (Rossiter & Percy,
2012). They just need to be adjusted to new media conditions.
What Makes a Brand Strong? Awareness and image are the main determinants of a
brand’s long-term success (Keller, 1993, 2019) and the persuasive power of strong
brands. Awareness is a necessary condition to ensure that a brand influences
purchase decisions. A brand unknown to consumers usually is not considered as a
relevant purchase option. Then brand image goes beyond brand awareness, defined
as “perceptions about a brand as reflected by the brand associations held in consumer
memory” (Keller, 1993, p. 3). In other words, the brand image is the sum of all
associations connected in a consumer’s mind with a brand. Consumers prefer brands
with strong, favorable, and unique images (Keller, 1993, 2009, 2019). The more
familiar (brand awareness) a consumer is with a brand, and the more positive,
unique, and strong the associations with the brand are (brand image), the more likely
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this consumer is to buy the brand (Esch et al., 2006). Thus, building and maintaining
brand awareness and brand image are superordinate targets of brand management.
9.3.1
Strategies to Build Strong Brands
Brand positioning is a starting point for building strong brands. All brand communication decisions should align with a brand’s positioning strategy, or the position it
aims to gain in consumers’ minds (Keller, 2019), which “involves identifying and
establishing points of parity and points of difference . . . to create the proper brand
image” (Keller et al., 2008, p. 94). Brand management thus defines the core
associations that its target group should connect to the brand, which should meet
three requirements (Kroeber-Riel & Esch, 2015; Keller, 2019): first, the associations
must differentiate the brand from competitors; second, they should be attractive and
relevant to the target group; and third, they have to have a long-term relevance for
consumers. Milka meets these requirements with its positioning as “the ultimate
tender alpine milk chocolate,” and Beiersdorf uses associations of “gentle,” “protective,” and “caring” to position its body care brand Nivea (Keller et al., 2008).
9.3.2
Tactics to Build Strong Brands
To foster brand awareness and image, brand managers must anticipate how consumers perceive and process brands. Thus, they should account for key psychological principles. A broad range of persuasion principles have been proposed by
branding and advertising literature (e.g., Rossiter & Bellman, 2005; Armstrong,
2010; Keller, 2019), which can be condensed into four communication tactics
(Belch & Belch, 2007; Kroeber-Riel & Esch, 2015): attention, liking, comprehension, and retention (McGuire, 1978).
Attention: Getting in Contact with the Target Group The first obstacle a brand
must overcome is to become noticed. The brand, its products, and its communications must attract the attention of the target group or else it cannot convey a message.
Increasing media clutter makes it more and more difficult to get in contact with
consumers.
Liking: Eliciting Positive Emotions In every consumer–brand interaction, the
brand should elicit positive emotions to establish brand liking. Negative (and even
neutral) brand associations lead to dislike, and dislike hampers sales. Yet even brand
liking is just an intermediate stage; ultimately, brand preference is the goal, such that
consumers prefer the brand over its competitors (Rossiter & Bellman, 2005).
Whether a brand relies more on emotions and/or information reflects its positioning
strategy, which in turn depends on target consumers’ buying motives.
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Comprehension: Conveying Relevant Information Brand management should
ensure the relevant brand information is perceived and understood by customers,
which is difficult when brand contacts feature minimal consumer involvement. Gaze
durations are short, and the level of cognitive processing is low. Thus, relevant
information has to be conveyed quickly. Only high-involvement consumers are
interested in detailed brand information and exhibit longer gaze durations (e.g.,
Kroeber-Riel & Esch, 2015).
Retention: Establishing Brand Knowledge Brand communication should be
designed to make the brand’s message (e.g., brand positioning) easy to remember.
Many consumer–brand contacts take place in situations in which potential customers
are not very involved and do not plan to purchase products offered by the brand.
However, it is important to establish awareness and image in the early phases of the
customer buying cycle to ensure that consumers include the brand in their purchase
considerations.
If these communication steps can be completed successfully, consumers may
exhibit positive behaviors toward the brand, such as purchase, recommendation, or
the creation of positive brand-related content. The extent to which consumers create
user-generated content depends on their type and level of involvement (Muntinga
et al., 2011).
9.3.2.1
Getting in Contact with Customers in an Environment
of Changing Media Consumption
As more brands, products, and services fight for consumers’ attention, the number of
advertising messages also has dramatically increased, especially through electronic
communication. In response, many consumers adopt strategies to ignore advertising,
as described by terms such as banner blindness (e.g., Cho & Cheon, 2004;
Zouharová et al., 2016), such that consumers avoid fixations on web banner ads,
or channel hopping to avoid commercials on broadcasts (Lim et al., 2008). Because
consumers can decide for themselves which brand-related content to view, content
consumption is choice-driven, and consumers apply “trigger-finger reflexes to skip
ads online” (Facebook, 2017, p. 16). Overall then, it is very difficult for brands to
contact target consumers, and they require new strategies to gain attention.
9.3.2.1.1
Attention Tactics I: Gaining Initial Contact
In contemporary media environments, visual cues are prevalent, especially in social
media. The number of consumers streaming live videos on Facebook increased by
four times from May 2016 to November 2016 (Facebook, 2017). To survive in an
overloaded media world, message visualization is a key premise for successful brand
communication. Furthermore, in the digital realm companies must ensure their
websites and brand-related content are easy to find. Thus, every brand should
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optimize its page ranks in search engines. Being among the first entries in Google
can strongly increase the possibility of contacting target consumers.
Besides search engine optimization as a technical instrument to increase the
chances of establishing contact, there are ad-related approaches that enhance the
probabilities of reaching target customers. Consumers are permanently exposed to
brands. While walking through a town, they pass outdoor ads; in the subway, they
are confronted by ambient advertising; while browsing a magazine or searching the
Internet for information, they also see various ads. Attracting their initial attention
depends largely on structural features, such as the size of the ad, the size of its
pictorial element, colors, and layout (Rossiter & Bellman, 2005). For gaining the
first contact, an ad’s message content is of secondary importance. This assertion
holds true both for searchers and browsers.
Size The bigger an ad, the more likely it is to attract attention (Rossiter & Bellman,
2005; Kroeber-Riel & Esch, 2015). This standard applies to various kinds of brand
communication. According to Rauschnabel et al. (2012), for example, the size of a
brand post on Facebook affects the number of Likes it garners.
Pictures The use of pictures increases the likelihood that an ad receives visual
fixations (Pieters & Wedel, 2004). Pictures should be used in all types of advertisements. Advertising that depicts faces (especially eyes) of humans or animals, babies,
and erotic or emotional scenes are particularly eye-catching (Rossiter et al., 2004;
Rossiter & Bellman, 2005; Kroeber-Riel & Esch, 2015). If consumers are less
involved, the pictures should be as large as possible (Rossiter & Bellman, 2005).
Rauschnabel et al. (2012) also find that Facebook posts stimulate more Likes and
comments if they contain pictures, whereas more text decreases the likelihood of
consumer–brand interactions.
Color Color has a strong positive impact on attention. Even ads in a colorful
environment benefit from the inclusion of color. For example, the attention probability for advertising in popular magazines, which tend to feature substantial color
themselves, decreases by approximately 30% for black-and-white ads versus fourcolor ads (Rossiter & Bellman, 2005).
Layout The position of the ad is highly relevant for banner ads. Due to banner
blindness, web banner ads should avoid typical positions, such as the top or right
side (e.g., Sherman & Deighton, 2001; Cho & Cheon, 2004). Consumers have
learned to avoid fixations on these positions, but banner ads included in the text of
a website may be more likely to gain attention.
9.3.2.1.2
Attention Tactics II: Holding and Intensifying Contact
Brand management aims to make consumers look at an advertisement, then encourages them to intensify their contacts. This intensification can be achieved through
two main approaches. The first is to use affective stimuli to increase individual
involvement with the ad, such as by including faces (and eyes) of humans or
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Fig. 9.4 Attention tactics and examples. (Sources: instagram.com/fanta; facebook.com/FantaUSA/
; dior.com; about.sixt.com)
animals, human or animal babies, and erotic or emotional scenes (Rossiter et al.,
2004; Rossiter & Bellman, 2005; Kroeber-Riel & Esch, 2015). The second involves
collative stimuli, such as humor or mental conflicts, which motivate consumers to
keep considering the stimulus (Kroeber-Riel & Gröppel-Klein, 2013). Figure 9.4
contains an overview of these introduced attention tactics with examples of brandrelated communication in online and offline contexts.
Besides the mentioned approaches, the message content is crucial for maintaining
and intensifying the consumer’s attention. Companies should try to engage consumers in an involving interaction with the brand to enhance the effects of this
interaction on brand awareness and image. The more involving a brand contact is,
the better the brand will be anchored in consumers’ minds, and the more associations
they can connect to it. Increasing involvement is a very challenging task though
because consumers display substantial inertia. It is easier for high-involvement
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brands that evoke emotion, such as Apple, Harley-Davidson, or Mini, to overcome
consumer inertia than it is for low-involvement brands, such as Newcastle Brown
Ale or Lay’s potato chips. However, ads must meet consumer interests precisely to
increase involvement. Furthermore, browsers and searchers have different motivations for interacting with brands.
Tactics to Persuade Browsers Emotionally involved browsers seek entertainment,
so enjoyment and remuneration are their main motives for consuming, contributing
to, or creating brand-related content (Muntinga et al., 2011). There are many
opportunities for brands to entertain target consumers (e.g., advergames related to
a brand’s positioning, entertaining podcasts). In addition, some consumers interact
with brands in the hope of receiving some sort of reward or prize. Muntinga et al.
(2011, p. 28) provide consumer verbatim statements that illustrate how these motives
can interact too, such as “then I started to actually like playing the game; so, I
initially played to win a trip, but I finished it because I thought it was amusing.”
Ambient advertisements—“a creative, innovative form of outdoor advertising that
explicitly intends to surprise consumers by placing unexpected advertisements at
unusual locations” (Hutter, 2015)—can be particularly helpful for encouraging less
involved consumers to visit a brand’s websites.
Tactics to Persuade Searchers Searchers pursue a concrete target, so their motivations for consuming, contributing to, or creating brand-related contents primarily
relate to information access. They read product reviews written by others, ask
questions in brand communities, or visit a brand’s website to receive the latest
information about a product of interest. Muntinga et al. (2011) identify four motivations for consuming brand-related content: to improve brand and product knowledge, to stay updated about consumption situations in their social environment (e.g.,
which brands do my friends like?), to obtain reliable prepurchase information, or to
be inspired (e.g., scanning friends’ holiday pictures to get ideas for their own
travels). To keep contact with searchers, brands should present relevant information
in a way that supports their search. Search engines should be intuitive, and brandrelated information should be easy to understand. In addition, searchers can be
motivated to engage in brand interactions that satisfy their remuneration motives
(Muntinga et al., 2011).
Recommendations for getting in contact:
• Optimize search engine page ranks.
• In mass media, use visual communication.
• Use attention tactic I (intensive stimuli) to ensure that advertisements get noticed
initially.
• Then use attention tactics II (affective and collative stimuli) to encourage consumers to maintain and intensify contact with an ad.
• Develop strategies to involve target consumers in intensive brand interactions.
• To maintain contact with browsers, satisfy entertainment and remuneration needs.
• To maintain contact with searchers, facilitate information searches.
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Conveying Emotions in Changing Media Consumption
Environments
Eliciting emotions is an important prerequisite for successful brand communications
(e.g., Heath et al., 2006; Poels & Dewitte, 2006; Kang et al., 2020). Whereas
cognitive thinking is demanding, relying on feelings is not, so emotional attitude
formation tends to be a fast, automatic, and unconscious process (Damasio, 1994;
LeDoux, 1996). Consumers’ emotional assessments stay ahead of their cognitive
thinking, often finishing within a fraction of a second. For example, within 100 milliseconds, people can make an emotional assessment of a stranger and decide
whether they like the person (Faller & Schowalter, 2019). Similar evaluations likely
are possible for brands.
Positive affect causes liking, which exerts a positive effect on purchase likelihood. The conveyance of positive affect therefore is an important prerequisite for
building strong brands. Companies can use emotions to persuade consumers in
two ways: peripherally or centrally (Kroeber-Riel & Esch, 2015). The former route
involves the creation of a positive atmosphere, whereas the latter refers to the
development of an emotional and sensorial brand experience.
Creating a Positive Emotional Atmosphere Emotional stimuli can create a pleasant
mood for brand communication (Kroeber-Riel & Esch, 2015). Pleasant colors,
surroundings, odors, background music, or objects can establish a positive atmosphere. Information is more likely to be accepted and remembered when it is
presented in a pleasant rather than a negative or neutral one (Kroeber-Riel & Esch,
2015). Therefore, companies should ensure that they always provide a pleasant
emotional atmosphere, for every brand contact. Figure 9.5 presents a Twitter post
by Toblerone that establishes such an atmosphere through the use of pleasant colors
and spring flowers.
Providing an Emotional Brand Experience Emotions also can be central routes to
persuasion, and in some cases, product differentiation by means of emotional
conditioning can be a particularly effective strategy to influence consumers
(Kroeber-Riel, 1984). Through emotional conditioning, a brand, which is inherently
a neutral stimulus, can become emotionally charged. If a brand is repeatedly
presented together with an emotional stimulus, consumers link those emotions to
the brand. Subsequent contacts with this brand then evoke matching emotional
reactions in those consumers (Kroeber-Riel & Gröppel-Klein, 2013). Brands aim
to provide vivid, strong, unique emotional experiences (Kroeber-Riel & Esch, 2015;
Diehl & Terlutter, 2018; see Diehl & Terlutter, Chap. 10), which in turn can provide
a basis for enduring consumer–brand relations (Brakus et al., 2009; Schmitt, 2009).
In these relationships, the emotional experience is a main reason consumers buy.
Brands such as Bacardi (“150 years of starting parties”), Harley-Davidson (“Your
ride to freedom”), or Milka (“The Alpine Milk Chocolate Experience”) provide
powerful emotional experiences in every brand contact. Harley-Davidson paints a
consistent picture of the emotional experience of independence, unlimited freedom,
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Fig. 9.5 Positive emotional atmosphere: Toblerone on Twitter. (Source: twitter.com/toblerone)
and the American way of life (see Fig. 9.6). Embedded videos and pictures depict
stories of customers using their Harley and thereby achieving feelings of freedom
and independence.
Tactics to Persuade Browsers Due to their emotional involvement, browsers want
entertainment and stimulation, which likely requires pictures, videos, music, or
advergames. To advertise the start of the crime series Blue Bloods, a network used
large, interactive billboards, which people could scan using their smartphones to
initiate a first-person shooter game that matched the brand positioning. As other
passersby watched consumers experiencing the fun of the game, they also started
it. The activity was also linked to Twitter.
Tactics to Persuade Searchers Even though searchers want information and facts,
such that entertainment is of secondary relevance, brand-related information should
always be presented in a pleasant, entertaining way, to enhance brand-related
cognitions (Batra & Stayman, 1990; Esch & Honal, 2018).
Recommendations for eliciting emotions:
• Create a positive emotional atmosphere during every brand contact.
• Differentiate brands through emotional conditioning.
• Leverage emotional brand experiences to establish strong, enduring consumer–
brand relations that match the brand’s positioning.
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Fig. 9.6 Providing emotional experiences: Harley-Davidson on Instagram. (Source: instagram.
com/harleydavidson_uk)
9.3.2.3
Conveying Information in Changing Media Consumption
Environments
Most brand contacts take place in a low-involvement setting, such that consumers
are distracted and brand exposures are short. Thus, cognitive processing is relatively
rare. Even searchers tend to be multitasking while looking for information. In
dynamic, digital settings, attention spans also are very short, though information
can be conveyed even in a fraction of a second. For example, consumers remember
content from news feeds on their mobile devices after viewing it for only 0.25 s
(Facebook, 2016). Companies therefore should ensure their advertising messages are
easy to understand, in line with the long-standing KISS principle (“Keep it Short and
Simple”).
Brand touchpoints might reach both searchers and browsers, such that magazine
ads, web banners, outdoor ads, and postings on social media pages must appeal to
consumers with widely varying involvement (even if browsers tend to be the
majority). To ensure that all these contacts are effective for both types of consumers,
brand information should be presented in a hierarchical manner (Armstrong, 2010;
Kroeber-Riel & Esch, 2015). The most important information (e.g., brand positioning, key advertising message) should be conveyed by ad elements on which consumers fixate initially (i.e., image and headline). Information with less relevance can
then be included in the copy text. Such a hierarchical information design ensures
that both low- and high-involvement consumers perceive critical advertising
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Fig. 9.7 Example hierarchical information design: Accenture banner ad. (Source: wsj.com)
messages at a glance, and then information seekers can obtain further information by
reading the text in detail. In Fig. 9.7, a banner advertisement by Accenture offers an
example of a hierarchical information design.
Brands also should link low-involvement advertisements (e.g., television commercials, magazines ads, outdoor ads) through channel switch buttons (e.g., QR
codes, red button on HbbTV) that lead to high-involvement media (e.g., websites)
with more detailed information (Fig. 9.8; see Diehl et al., Chap. 11). Then searchers
can satisfy their information needs conveniently by switching to another channel.
Both searchers and browsers might use channel switch buttons though, depending
on their specific use case. Figure 9.9 shows examples of both. For example, Burger
King included a red button in its television advertising to engage low-involvement
consumers by promising them a coupon for a Whopper. If they hit the red button,
they would be directed to a microsite where they could configure their own Whopper
and then receive the coupon to redeem at a Burger King restaurant. In its catalogs,
IKEA also included QR codes to engage already involved consumers further.
Consumers can scan the QR codes to be directed to appropriate sections of the
website and learn further information.
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Fig. 9.8 Examples of channel switch buttons
Tactics to Persuade Browsers Less involved consumers primarily note images and
headlines, not the copy (Kroeber-Riel & Esch, 2015). Pieters and Warlop (1999)
confirm this tendency even for perceptions of product packages during brand choice
efforts: consumers under time pressure focus on pictorial rather than textual elements. Therefore, advertising messages must be communicated by images and
meaningful headlines, a rule that applies to online advertising and website design
too. Even on brand-related social media pages, browsers prefer to glance at images
and videos instead of reading longer texts (Rauschnabel et al., 2012). Finally,
mystery ads—“those in which the brand is not identified until the end of the ad”
(Fazio et al., 1992)—do not work for less involved consumers, who are too passive
to solve the mystery.
Tactics to Persuade Searchers Consumers in prepurchase phases often exhibit
extensive information interest, such that they are willing to read textual information,
more so than browsers (Kroeber-Riel & Esch, 2015). Searchers often rely on highinvolvement advertising such as brand brochures or brand websites. Still, information should be provided consistently in a convenient way so that information seekers
find it easy to obtain and comprehend the information. Companies can use images,
videos, graphs, or mp3 files, in addition to textual information, to support consumers’ perception and processing of information. For example, 69% of consumers
who visit a web page to learn something about a product or service prefer to watch an
explanatory video rather than to read an explanatory text (Wyzowl, 2016). Highly
involved consumers also attach great importance to the quality of brand information
and evaluate it more critically than browsers do. Due to their enhanced involvement,
searchers also engage in brand-related social media communication, such as posting
comments, asking questions in blogs, or rating products. Thus, they create brandrelated communication, as well as consuming it. Finally, well-trained employees
should answer questions asked by consumers quickly and reliably.
Recommendations for conveying information:
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Fig. 9.9 Examples of channel switches across different media for browsers and searchers. (Source:
sevenonemedia.ch; ikea.com)
• Provide information in a hierarchical manner.
• Communicate the advertising message in images and meaningful headlines
(avoid mystery ads).
• Provide reliable, true information in a comprehensible manner.
• Include channel switch buttons to meet the greater information needs of
searchers.
• Define guidelines for how employees should handle consumers’ questions and
comments.
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Retention of Brand Information in Changing Media
Consumption Environments
Building strong brands is a process, such that consumers learn to make positive,
unique associations with the brand (e.g., Keller, 2019). In general, priming a brand’s
story across different media seems beneficial for reinforcing the impact of a campaign. For example, preceding an advertising exposure on one medium with an
exposure on another medium can lead to stronger neurological reactions, such as
greater levels of memory encoding (Neuro-Insight, 2015). Repeated exposures to a
brand and its communication thus are necessary. To advertise in an effective and
efficient manner, each contact with the brand should build brand equity (Naik &
Raman, 2003; Reid et al., 2003). The concept of integrated advertising supports
brand building, especially in a cluttered advertising environment (see Diehl &
Terlutter, Chap. 10). Accordingly, every advertisement should be designed in a
way to enable consumers to recognize the sender (formal integration) and perceive
and process the brand positioning quickly (content-related integration) (Esch, 1998;
Kroeber-Riel & Esch, 2015).
Formal Integration This concept pertains to a “one-look approach” (Esch, 1998;
Belch & Belch, 2007), such that every consumer contact uses the brand’s corporate
design consistently. The inclusion of brand-specific elements (e.g., color, logo,
brand name, brand specific layout) ensures that consumers quickly recognize the
advertised brand during every brand contact. Formal integration thus contributes
significantly to establishing brand awareness (Esch, 1998).
Content-Related Integration Content-related integration refers to a “one-voice
approach” (Esch, 1998; Belch & Belch, 2007), in which all messages a brand
conveys at all contact points are coordinated and supportive of the brand’s positioning. Content-related integration can be achieved by using the same images, music,
scents, haptics, or verbal messages across communication contacts, which in turn
helps establish the brand image (Esch, 1998). A promising approach might include
the same key visual across all communication contacts that conveys the positioning
of a brand (Kroeber-Riel & Esch, 2015), such as Wells Fargo’s stagecoach or
Milka’s lilac cow. That is, Milka consistently uses its lilac color and unique written
brand name (formal integration), but it also conveys the emotional “alpine milk
chocolate experience” across all media (content-related integration). Images (and
sounds and odors when possible) of an alpine setting and lilac cow are prevalent in
every contact (Fig. 9.10; see Diehl & Terlutter, Chap. 10).
When more incidental, less involving, brand-related content is consumed, the
communication must be even stronger and more integrated to be able to activate an
existing brand schema successfully. Uniqueness is a pivotal driver of the retention of
brand information too.
Recommendations for encouraging the retention of brand information:
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Fig. 9.10 Integrated advertising by Milka. (Source: milka.de; facebook.com/MilkaDACH/;
youtube.com/user/Milka)
• Apply formal integration, such that every brand contact has the same look to
ensure that even less involved consumers quickly recognize the advertised brand
(in support of brand awareness).
• Apply content-related integration, such that the brand communicates with the
same voice across all contact points to establish the brand image.
9.4
Conclusions and Outlook
Media consumption has changed radically, and the daily efforts of brand managers
accordingly have been widely affected. One-sided brand-to-consumer communication is complemented by consumer-to-brand and consumer-to-consumer communication. Due to consumers’ frequent multitasking, their involvement is diminished,
meaning it is rare for brands to receive their full attention. Social media, as an
integral element of everyday communication, also gives consumers the ability to
participate in brand communications and interact with other consumers about
brands. The body of decoupled, brand-related conversations thus is growing in
data-driven communication environments, threatening brand management with a
loss of control. Brands should develop more knowledge about communication
processes and their effects on consumers to cope with such challenges. In particular,
brand monitoring is crucial to brand success in today’s communication
environments.
As technological progress continues, different communication mechanisms and
devices may become pivotal to brand success. Beyond the convergence of media and
channels, an increasing merging of real and digital worlds can be observed in
marketing communication. Virtual reality is providing an increasingly viable
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T. Langner and T. Klinke
interface between computer systems and human beings (Dörner et al., 2013; see
Terlutter & Ninaus, Chap. 13). It supports the complete immersion of the user in a
synthetic environment, such that users no longer perceive the real world around
them; augmented reality instead enriches reality with virtual components rather than
replacing it (see Leitner, Chap. 24). These various combinations of reality and
virtuality, real-time interaction, and three-dimensionality are key characteristics of
augmented reality systems (Yilmaz, 2016).
Media technology is changing at an unprecedented pace. New opportunities and
risks for brand management are constantly emerging. But regardless of the context in
which consumers experience a brand or the channel in which their contacts occur,
some things remain unaffected, namely, the fundamental principles for building and
managing a brand. Strong brands are strong because they adopt an appropriate and
valid positioning that they communicate effectively during every encounter with
customers.
9.5
Exercises and Reflexive Questions
1. What are some fundamental changes in media consumption?
2. Think about technological progress over the next 20 years. What will the media
environment look like? What will media consumption look like?
3. What criteria underlie successful brand management in rapidly changing media
environments?
4. How can consumers be categorized according to their uses of digital media?
5. Which strategies and tactics can companies employ to manage their brands
successfully?
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html
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Tobias Klinke is PhD student and Research Associate at the
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wiwi.uni-wuppertal.de/de/team/mitarbeiter/tobias-klinke-msc.
html
Chapter 10
Brand Worlds: A Guide to Creating Holistic
Worlds of Brand Experiences Through
Communication
Sandra Diehl and Ralf Terlutter
Abstract The brand communication landscape is changing rapidly due to changing
market, communication, and social and demographic parameters. Many companies
aim at creating strong holistic brand worlds in order to anchor the brand as an
important element in consumers’ lives. From the companies’ point of view, successful brand worlds promise a clear, distinctive, and long-lasting positioning of the
brand and an increase in customer loyalty. However, it is important to note that
consumers expect the brand world to make important and sustainable contributions
to the consumers’ feelings, memories, and experiences, that is, authentic contributions to consumers’ lives. Communication plays an important role in the development of successful brand worlds. This chapter first describes the components and
functions of brand worlds. Afterward, the focus is on the strategic and operative
conception of brand worlds. Readers will find that this chapter serves as a guide with
a detailed checklist that can be used to examine whether the intended brand world
matches the brand and recommendations for the visual and multisensual communicative implementation of the brand world. Finally, multiple practical examples are
used to draw attention to the necessary coordination of social media activities with
the brand world. The chapter concludes with ethical considerations on brand worlds.
10.1
Introduction
Communication and the conveyance of information via various media have changed
significantly in recent years due to the increasing diversity and convergence of
media, especially social media, which also requires permanent change management
in the area of corporate communication. Advertisers and communication professionals adapt to this change and seek new ways of making their products unique to
their customers (see Langner & Klinke, Chap. 9 and Terlutter & Ninaus, Chap. 13).
Brand worlds are a promising option.
S. Diehl (*) · R. Terlutter
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: sandra.diehl@aau.at; ralf.terlutter@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_10
169
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In many product categories, high product quality is taken for granted and
competing offers are often perceived as interchangeable. In such markets, need for
information decreases, and consumers seek emotional experiences when using a
brand. Against the background of saturated markets and mature, largely interchangeable products, only brands that manage to anchor themselves permanently in the
minds of consumers can survive in the long term (Weinberg & Diehl, 2001; Pine II &
Gilmore, 1999). This is probably even more important in today’s digital age with its
ever-changing communication landscape (Smilansky, 2018). Due to consumers’
extensive connectivity and participation, consumers have a higher impact on brand
communication. In today’s convergent media world, companies have to accept that a
significant amount of brand-related information is generated by users and is no
longer under the control of the brand (Langner et al., 2013; see Langner & Klinke,
Chap. 9). Brand communication has to become more creative to be attractive to
consumers. Experience consumption gains in importance (Bauer et al., 2012) as the
quality of brand experience becomes a central purchase criterion. Thus, building a
holistic world of brand experience is a suitable strategy for creating sustainable
experiences in marketing communication. While brand worlds and attempts to build
them are more often found in B2C market, they also exist in B2B markets. The
contribution extends the earlier articles by Diehl and Terlutter (2018, 2019).
10.2
10.2.1
Fundamentals of Brand Worlds
Definition of Brand Worlds
We define brand world as overall impression of specific emotional experiences
conveyed by a brand in which the experiences are subjectively perceived contributions to consumers’ quality of life (see also Weinberg, 1992). It encompasses all the
emotional brand experiences conveyed to the consumer.
There are two different strategies for conveying experiences (see Kroeber-Riel &
Gröppel-Klein, 2019):
1. Triggering pleasant feelings, which strengthen the emotional relations with the
company/product. However, this only involves nonspecific experiences, which
are often interchangeable (e.g., use of pleasant images in advertising, giveaways,
and music at the point of sale).
2. Triggering very specific experiences that differentiate and clearly position one’s
own offerings from other offers in order to create a unique emotional profile (e.g.,
distinctive strategies by Milka’s “Alpine World” or Red Bull’s “Gives You
Wings”). This is meant when we speak of a brand world. The consumer can be
rather passive when consuming the brand (world) or more active, contributing to
the development of the brand world, for instance, by co-creation of the offer,
active WoM, etc.
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171
It should be noted that merely conveying pleasant stimuli is not sufficient to
create a successful brand world; this requires strong emotions that allow a unique
positioning in the competitive environment and that are important to the consumer
(see also Esch et al., 2012). Emotional brand experiences can positively impact
brand loyalty (Brakus et al., 2009). The brand world can even lead to brand love. The
emergence of brand love is seen as the result of a combination of brand-endogenous
and -exogenous emotional experiences. Brand love results in a lasting consumer–
brand relationship characterized by strong and positive feelings for a brand (Langner
et al., 2016; see Langner & Klinke, Chap. 9). The real experiences made with the
product also have a strong influence on the product evaluation and interact with the
product experience conveyed by the media (Diehl, 2009).
10.2.2
Components of the Brand World: The Brand World
Pyramid
An emotional world of brand experience consists of five layers that build on each
other and can be visualized like a pyramid (Weinberg & Diehl, 2005) (see Fig. 10.1).
Fig. 10.1 Brand world pyramid. (Based on Weinberg & Diehl, 2005, Diehl & Terlutter, 2018,
2019)
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Fig. 10.2 Close relationship between experience-based product design and communication policy
in advertising for Cool Water (source: Diehl & Terlutter, 2018; www. http://www.zinodavidoff.
com/fragrances/) and for Spirit Of The Brave by Diesel (source: https://www.instagram.com/
dieselfragrances/)
At the core of the emotional brand world are the physical product, its components,
and chemical composition and quality. The task of the first layer is to ensure that the
product functions well and thus the basic benefit of the product is fulfilled. Brands
without a strong product core are rarely appreciated. For instance, consumers love
Nutella’s special nougat taste and creaminess (Langner et al., 2013). The second
layer consists of the product design and the product packaging. Product design is the
external, sensually perceptible design of the product. Only an experience-based
design can generate preferences among consumers.
A good example is Davidoff’s Cool Water perfume: the blue color scheme, the
smooth, haptically cool, drop-shaped bottle and the smooth shiny metallic packaging
convey the cool freshness experience and the fresh scent in a multisensual way (see
Fig. 10.2). A purposefully applied experience-based design should also have a close
connection to the communication policy. In the Cool Water advertisement, a woman
is shown against a background of blue water. For the male fragrance, a similar motif
is used and the splashing water supports the conveyed experience. All advertising
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Brand Worlds: A Guide to Creating Holistic Worlds of Brand Experiences. . .
173
images trigger a cool freshness experience, which is additionally emphasized by the
slogan “The Power of Cool.”
Another good example is the fragrance Spirit Of The Brave by Diesel. Bravery is
transferred to the customer in a multisensual way: the flacon in the shape of a fist
supports the notion of strength, determination, and willingness to take risks. The
colors black and gold and the lion’s head stand for strength and energy and add to the
notion of bravery as well. In the related Instagram campaign of Spirit Of The Brave,
the ingredients are described as energizing, daring, and audacious. Attributes that are
all also linked to people who go through life with bravery (Fig. 10.2).
The requirements for packaging are similar to those for product design. The
packaging also makes an important contribution to the brand experience. For the
packaging, a concise and unique design including the shape, color, graphics, labeling, and haptics are important in order to support the desired positioning and quality
perception. The packaging assumes important functions, and it should have an
activating effect, support the appearance of the product, and promote what can be
expected of the brand. For this reason, the packaging plays a central role in
positioning the product (Smilansky, 2018). For instance, the Ferrero Rocher chocolate balls individually wrapped in golden paper support the positioning as premium
chocolates (though this packaging is questionable as it is not sustainable at all). The
Coca-Cola contour bottle is also a key factor for Coca-Cola’s success. It contributes
a lot to the brand value and is a means of communication that symbolizes the CocaCola brand par excellence (Wiezorek, 2004, p. 1238).
The third layer is formed by the brand name. While a brand world is mainly built
up through communication, a carefully created or chosen name can give the brand its
intrinsic strength right from the start (see Kohli & La Bahn, 1997). The brand name
should appeal to consumers emotionally, and it should be easy to learn and retrieve.
Other criteria to consider include relevance to the product category, associations that
are connected with the name, and the brand name’s ability to stand out (protectable)
from competing products, as well as the international applicability of the name.
Consumers prefer products with names that they think are typical brand names for
the product category over products with atypical names (see Kohli & La Bahn, 1997;
Kohli et al., 2001; Langner, 2003). This underlines the importance of ensuring that
the brand name matches the product. A brand name that fulfills the mentioned
requirements and is internationally applicable is again Cool Water by Davidoff.
The creation of an emotional positioning through the triggering of inner, emotionally charged mental images is the task of the fourth layer. Communication policy
measures serve to position the brand in the users’ minds and give it a unique
experience that consumers associate with the brand. A brand story is inevitably
needed as customers are increasingly demanding more information on what a
company stands for. It is crucial to connect the experience with the own brand
story to ensure real engagement and strong customer relationships (Smith & Hanover, 2016). The image of the brand is shaped by all marketing mix instruments,
which results in the necessity of integrated communication (see Bruhn, 2014; Esch,
2011) as a base for a successful holistic brand world. All the instruments of the
marketing mix, ranging from pricing, product, communications to distribution, must
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fit and be tailored to the emotional brand world so that it can be consistently
presented and learned. Good examples of emotional brand worlds that also extend
to distribution policy are Brand Lands (such as Legoland, Audi Forum Ingolstadt) or
flagship stores (such as Apple Stores, Disney Stores). Brand Lands in particular (but
also flagship stores, trade fair appearances, etc.) are “walk-in” worlds of experience
and live communication (see also Kirchgeorg et al., 2012).
The fifth layer is about the symbolic value, the myth that makes the brand unique
and clearly positions it in the minds of consumers (cf. Diehl & Terlutter, 2004,
p. 2647ff.). Brands that are able to build this additional layer can establish a lasting
holistic brand world. In addition to corporate design and corporate communication,
this layer is also shaped by the provider’s corporate behavior. The values and
corporate philosophy of the brand manufacturer also influence the world of the
brand. Biel (1996, p. 2) labels it “brand magic.” For instance, with every pair of
Nike shoes, customers also buy a share of sportiness and individuality.
10.3
10.3.1
Conception of Brand Worlds
Steps to the Conception of Brand Worlds
Several steps are required to design a holistic brand world (see Kroeber-Riel & Esch,
2015; for an application example, see Weinberg et al., 2003):
1.
2.
3.
4.
5.
6.
7.
8.
Generate emotional experience concepts
Reduction to suitable concepts
Operationalization and visualization of the concepts
Systematic review, assessment, and selection
Test of remaining alternatives
Decision in favor of a concept
Derivation of a key image for the implementation
Implementation of the concept in means of communication
In practice, shortcomings occur mainly in phase 1—when generating concept
ideas—and in phase 7—when deriving a key image. Similar to the development of
product innovations, the development of experience concepts has shown that an
intensive, creative search over a longer period of time is necessary to break away
from already well-known industry-typical ideas and stereotypes and to find new,
innovative concepts. Only a small percentage of the initially collected ideas ever
reaches the next stage (see Kroeber-Riel, 1989; Weinberg et al., 2003). Therefore, a
special focus should be put on the first phase of the search process. In the first phase,
a sufficient number of ideas and experiences have to be collected, which are then
sorted in terms of content and form in the second phase. It is important to eliminate
interchangeable experiences, experiences with little or even negative emotional
impact and experiences that do not fit the corporate image. The third phase is
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175
followed by the further development of the concepts, in particular their
operationalization and visualization.
In phases 4–6, the concepts are subjected to a more precise, empirically based
approval test. Among other things, the focus here is on the matchup between the
brand and the theme world as, in the long run, the characteristics of the brand world
are transferred to the brand. This transfer of characteristics can only be successful if
the world of experience matches the essence of the brand. Through separate association tests for the experience and the brand, it is possible to check whether there is a
sufficient fit.
As already mentioned, another critical phase that is very important to the success
of the emotional brand world is phase 7, where the key image is derived. Following
Kroeber-Riel (1993), we define a key image as a basic visual motif that contains the
visual core of an advertising message. When developing the key image, it must be
checked whether the key image is suitable for long-term positioning because
establishing a successful and sustainable brand world requires a long-term connection between the core of the brand and the brand world. The key image also needs to
address relevant emotions from a consumer perspective and provide ample scope for
variations in the implementation and visualization in different media (see Diehl
et al., Chap. 11). By using the key image in all means of communication, the
brand world can be consistently implemented in the sense of integrated communication (see Kroeber-Riel, 1993, pp. 300ff.).
For a more detailed discussion of the two central phases of the conception
process, please see Diehl and Terlutter (2018, 2019).
10.3.2
Checklist for Selecting a Suitable World of Experience
Experiences collected during the first phase need to be evaluated to ensure that only
appropriate concepts are further considered and move on to the next phases. The
following important points should be assessed in the rough selection (Diehl &
Terlutter, 2018):
• Does the experience evoke positive associations?
• Does the experience match the corporate philosophy?
• Is there a matchup between the world of experience and the brand?
Only when these three points can be answered in the affirmative does the
experience enter the short list.
In the second step, the following checklist is recommended for the fine selection
of a suitable world of experience:
• Are the experiences suitable for a long-term approach to the desired target group?
Are the lifestyle trends of the target group addressed? Are they personally
relevant for the target group? Is the target group looking for these experiences?
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S. Diehl and R. Terlutter
• Which experiences enable the company to stand out from the competition today
and will be difficult to imitate tomorrow?
• Is it possible to implement the experiences through as many marketing instruments as possible (marketing mix)?
• Are the experiences suitable for practicable implementation or do they put high
demands on the companies and agencies?
• Can the world of experience be communicated through various modalities (such
as text, images, language, movies, sounds, music, scents)? Can it be sensually
perceived by consumers? Does it address him or her holistically?
• Is it possible to coordinate information about the product and the emotional
approach in a credible and easily understandable way in order to create a unique
experience profile?
In most cases, the examination of these points can be conducted solely qualitatively and in the context of a team. However, it should be taken into consideration
that a concept test within market research is always difficult when there are original
and unusual concepts (see Weinberg & Diehl, 2006).
10.4
10.4.1
Communicative Implementation of Worlds
of Experience
Number of Communicated Experiences
The decision of a company for a single-brand, umbrella brand, or brand family
strategy influences the number of communicated experiences (see Diehl & Terlutter,
2018). Which strategy is the most suitable is determined by the chosen brand
strategy. Considering today’s communication conditions, the use of the same core
message or the same basic experience is recommended as a minimum. In the context
of increasing information overload and consumers’ decreasing interest in advertising, frequent repetition of the same basic experience increases the likelihood that the
brand or company will be linked to the experience. Good brand worlds should also
have the potential to be expanded. For instance, Davidoff presents an extension of
the “Cool Water” experiences to “Hot Water.” The same scenery (at the sea or on the
beach), the same staging (e.g., man and woman who are moistened with water), and
the experiences of eroticism and passion are arranged in a new way: consumers no
longer experience cool passion but rather hot passion. Other products that have been
integrated into Davidoff’s water world include the “Night Dive,” “Sea Rose,” and
“Cool Water Sensual Essence” fragrances (Fig. 10.3) (see Diehl & Terlutter, 2018).
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Brand Worlds: A Guide to Creating Holistic Worlds of Brand Experiences. . .
177
Fig. 10.3 Extension of Davidoff’s water-related brand world “Cool Water” to additional
sub-brands and to “Hot Water.” (Source: Diehl & Terlutter, 2018, http://www.zinodavidoff.com/
fragrances/)
10.4.2 Pictorial and Multisensual Communication
of the Brand World
The construction of a brand world takes place primarily through communication
policy measures. Through experiential communication as part of experiential marketing, an attempt is made to anchor the offer in the consumers’ world of experience.
Against the background of increasing information overload, visual communication
is of central importance. Hedonistic and low-involved consumers prefer pictures to
text for quick and easy information recording: “Pictures are quick shots into the
brain” (Kroeber-Riel, 1993, p. 53). Image communication calls for lower cognitive
resources than text and is particularly suitable for emotional experience (see
Kroeber-Riel, 1993; see Langner & Klinke, Chap. 9). When perceiving pictures,
humans easily get into an emotional state (Ferretti, 2017). For this reason, communication instruments should be primarily designed to address the consumers in a
visual way. Still, all other senses can be addressed, too, in order to gain a richer brand
experience. In addition to pictures, other nonlinguistic stimuli are especially suited
for the targeted triggering of emotions, above all colors, music (for music in detail,
see also Steffen & Schabing, 2015), and fragrances. The used language can also be
pictorial (see Weinberg, 1995). In addition to advertising, event and content marketing are particularly important communication tools for conveying the brand
world.
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S. Diehl and R. Terlutter
Colors:
Grey,
Orange,
Black, White
Words:
Pictures:
Liberty,
Rebellion,
Dance
Battles
Taste:
Hearty, Spicy,
Burger,
Lemonade,
International
Food
Skateboards,
Ghettoblaster,
Dance Moves,
Skyscrapers
Street Life
Experience
Scents:
Concrete,
Petroleum,
Gas
Sounds:
Hip Hop,
Heavy Beats,
Motor Horn,
Rap
Touch:
Concrete,
Steel
Fig. 10.4 Multisensory experience “Street Life” with practical example from Diesel (Source:
https://pixabay.com/de/photos/treppe-st%C3%A4dtischen-graffiti-farbe-1045454/; https://www.
instagram.com/dieselfragrances/)
Experiential strategies usually aim at the simultaneous addressing of several of
the consumer’s senses. In the consumer’s brand world schema, all the images,
words, emotions, sounds, and haptic and olfactory sensations relevant to the brand
are stored, which means that the brand image is stored in memory in a multimodal
way. For every brand, many sensory impressions exist in the minds of the consumers
(see here also the multimodal memory theory of Engelkamp, 1991, 1997). A
multisensory brand experience can lead to an enhanced and more memorable
brand experience and can have positive effects on brand image (Hultén, 2011) and
brand strength (Wiedmann et al., 2018).
The various stimulus modalities (e.g., tones, colors, images, words, fragrances,
tastes, haptics) must be coordinated. Through the simultaneous harmonized
approach of multiple senses, the same experience can be communicated many
times and thus more effectively. In addition, several modal-specific individual
experiences are combined into one overall experience (see the example in
Fig. 10.4 for Street Life). The synergetic effects of individual stimuli must be
taken into account. Stimuli of modality are used to trigger or influence the effect
of stimuli of another modality, so that the mere fragrance of, for example, coconut
could already suffice to create a visual image of the Caribbean.
10.4.3 Mistakes to Avoid in the Communication of Brand
Worlds
Given the advantages of a brand world, it is surprising that there are fewer good
practice examples of unique brand worlds than might be expected. Often, marketing
does not succeed in giving a brand a specific and clear experience profile that
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179
Fig. 10.5 Examples of printed advertisements of the Volksbanken Raiffeisenbanken in Germany,
which were constantly modernized over time (from left to right). The core message “We clear the
way” and the key visual remained unchanged. (Source: Diehl & Terlutter, 2009)
distinguishes the brand from competing brands. The following reasons may be the
cause (see Kroeber-Riel & Gröppel-Klein, 2019):
1. The emotional stimuli used are too weak, the pictures do not “get under the skin.”
2. Emotional appeal and brand are not offered in temporal and spatial proximity, so
that the consumers do not link the emotional experience with the brand.
3. The advertising images used have too little continuity, are changed too frequently, are inconsistent, and are not sufficiently repeated.
4. The product impressions conveyed by conditioning are in contradiction to other
emotional impressions conveyed by marketing.
5. The mediated experiences are interchangeable with the experiences of the
competitors.
It is also important that the brand world should be constantly modernized and
optimized, but the core message of the world of experience should be retained. The
German brand world “We clear the way” (Wir machen den Weg frei) was a good
example of a brand world that was constantly being modernized over time, but its
core message remained unchanged (see Fig. 10.5).
Unfortunately, the key visual of the brand world was changed later, while the
slogan “We clear the way” was still displayed, though less prominently (see
Fig. 10.6). From a socio-technical perspective, this change resulted in a blurring of
the core message.
Another mistake, which is committed relatively often, is the lack of cross-media
use of the brand world. Rather often, the various media such as the Internet, TV,
print, and radio convey different experiences. Here, however, it is essential to
coordinate all media (including the Internet) to achieve a consistent external presentation (see also Diehl, 2002). Synergies and learning effects among consumers are
only achieved if the advertising appearances in the various media are well coordinated. The other communication tools such as events, sponsoring, public relations,
content marketing, and sales promotion measures must also be coordinated with the
brand world, as well as the appearance at the point of sale (e.g., Ermer & Kirchgeorg,
2014). According to Harris et al. (2018), the brand experience should be consistent
across all touch points during the customer journey, that is, customers’ contact points
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Fig. 10.6 Example of the
new image motifs of the
Volksbanken
Raiffeisenbanken in
Germany, without a clear
key visual and message.
(Source: https://www.
horizont.net/marketing/
nachrichten/morgen-kannkommen-das-ist-die-erstekampagne-von-ddb-fuerdie-volksbanken-undraiffeisenbanken-181482)
with the brand where consumers are open to influence (see Diehl et al., Chap. 11 and
Terlutter & Ninaus, Chap. 13).
Another mistake may be that the concept of the world of experience does not yet
take into account the international applicability of the world of experience in other
countries and cultures as cultural differences have to be respected (Diehl et al., 2003,
2008, 2015; Terlutter et al., 2010, 2012).
10.5
Practical Examples of Successful Brand Worlds
Here are some examples of successful brand worlds that meet the above requirements (see also Diehl & Terlutter, 2018, 2019).
Milka has been using the “Alpine World” experience for several decades and has
deeply anchored itself in the memory of consumers. Even toddlers know the purple
cow. The long-standing slogan “The tenderest temptation since chocolate exists” has
been replaced by the slogans “Dare to be tender” and currently “In the heart of
delicate,” but the delicacy of chocolate remains an integral part of the brand world.
Raffaello’s “Endless Summer” world of experience conveys experiences such as
lightness, luxury, vacation, and being carefree. The core message of “lightness,”
which has been retained for decades, has created a strong, unmistakable world of
experience, which is very present in the minds of consumers.
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181
Red Bull “Red Bull Gives You Wings” is also a stand-alone brand world that
conveys the experience of “energy, power, lightness, lift-off” and communicates to
consumers that the energy drink Red Bull gives new, extraordinary powers in all
situations.
Other brands such as Apple, Harley-Davidson, Levi’s, Nike, Ferrari, Porsche, or
Coca-Cola are also distinguished from competitors’ brands by the representation of
an attractive value system and the mediation of positive experiences.
10.6
Selected Social Media Activities of Well-Known Brand
Worlds
The social media activities should also be coordinated with the brand worlds. They
offer great potential for conveying the desired experiences. In the following, successful social media activities of well-known brands are shown as examples.
Red Bull “Gives You Wings” The world of experience of the Red Bull brand,
which conveys experiences such as “energy, power, lightness, lift-off,” is also
implemented through social media activities. Red Bull sponsors a variety of sporting
events, including Formula One. The most popular extreme sports events include
“Red Bull X-Fighters,” “Red Bull Crashed Ice,” and “Red Bull Air Race Series.”
The competitions are available, for instance, as videos on the Red Bull Air Race
website. In addition, Red Bull is also present in blogs. The fans can experience the
events live on the Internet, comment on, and redistribute them. At Red Bull, there is
less talk or buzz about the product itself in social media activities, but the staging of
the motto of the “Red Bull Gives You Wings” brand can be found through postings
of videos and photos in social media of Red Bull by people who are active in extreme
sports and are sponsored by Red Bull. These videos and photos are spectacular and
are spread by the users on the Internet as they address very specific audiences and
experiences. Here, Red Bull uses the specific tools that social media platforms offer:
for instance, Red Bull uses the hashtag #GivesYouWings on Twitter so that people
who like or participate in extreme sports mark their posts, videos, or photos with this
hashtag and can create a link, a relationship with Red Bull.
Dove (“Self-Esteem”) Dove’s vision in its brand world is to promote a positive
relationship between people and their bodies and their appearance worldwide.
Raising people’s self-esteem is part of the vision (Dove, 2020). For instance, with
the campaign #InMyOwnSkin, Dove wants to enhance people’s confidence in
their skin.
BMW In 2017, the company opted for a cooperation with the digital platform
Snapchat to provide its future customers with an extraordinary augmented reality
(AR) experience. BMW used Snapchat’s AR “augmented trial” Lens. With this
function, customers could project BMW’s X2 into the real world before purchasing
the car. In a playful mode, Snapchat users could also change the color of the
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AR-based car and turn it around to view it from different angles (Boeriu, 2017).
BMW introduced its AR campaign on Snapchat with a “Face Lens” for taking
selfies. The special feature of the Lens: the faces of the users were colored in the
Galvanic Gold finish of the X2. The Lens was available for users in Germany,
France, Italy, Spain, and the UK at the beginning of the campaign and created 2.5
million Snaps (Business Standard, 2017).
IKEA With the IKEA Place app, an augmented reality technology, the company
seeks to enhance customers’ experiences during their search for furniture (see
Terlutter & Ninaus, Chap. 13). Via the smartphone, the app projects a previously
selected item from the online catalogue directly into the home of the customer. Items
appear in their actual size, in realistic depictions, and the user can zoom in to look at
fabrics, too (IKEA, 2019).
With the additional implementation of augmented reality technologies in, for
example, retail stores (Bonetti et al., 2019), consumers are getting more engaged and
entertained. Immersive technologies can strengthen consumers’ feelings of engagement with the brand and can lead to an improved perception of the brand value.
10.7
Brand Worlds and Media Ethics
As outlined, emotional experiences in advertising play an increasing role in anchoring the brand in the consumer’s life against the background of a changing brand
communication landscape. From an ethical point of view, however, there may also
be problematic aspects that may concern, for instance, communication and advertising ethics as well as production and distribution ethics.
Relating to advertising, ethical issues can arise on two different levels: on the one
hand, at the level of advertising media; and on the other hand, at the level of
advertising material. For instance, in native advertising, consumers may not be
sufficiently aware of and may not identify the advertising as paid content. Consumers are often not attentive enough toward the disclosure (Wojdynski, 2016) or
they lack experience and media literacy (Jung & Heo, 2019). Another example is
advertising in computer games, in particular, advergaming, in which the attempt to
influence consumers (especially children) is strongly concealed (Terlutter & Capella,
2013; Waiguny et al., 2012; Waiguny & Terlutter, 2011).
As regards advertising design, campaigns sometimes use offensive advertising,
for example, through offensive images (e.g., Chan et al., 2007). Efforts to avoid the
use of weak emotional stimuli or images that do not get under the skin can
sometimes harbor a risk of using images that may injure or even discriminate
individuals or certain social groups in order to achieve the desired attention. Cultural
differences should be considered, too (Chan et al., 2007).
Furthermore, brand worlds should not deceive or mislead consumers about
the product (see Bohrmann, 2010, p. 296). This means that advertising ethics has
the function to ensure that communication about the product is ethically correct, that
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183
the quality of the product is communicated in a sincere and honest way, and that
consumers are not misled into ill-considered purchases, but are able to take up a
critical stance on the advertised product. It is important to avoid creating unrealistic
personal expectations (Quart, 2003) and pressure to buy the product, especially
when communicating to children or other sensitive population groups (RothEbner, 2019; Linn, 2004).
Besides the importance of communication ethics in advertising on the input side
(for the role of communicator, producer, and distributor), the question of the
“consumers” of media products (in this case of advertising) is of particular importance because they have a “joint responsibility” (see Funiok, 2010, p. 234). A high
level of advertising literacy, even among children, is important (e.g., Spielvogel &
Terlutter, 2013) and contributes to consumers being more reflective and critical
toward the advertising messages. Roth-Ebner (2019) argues that next to parents,
educational institutions are highly encouraged to promote the critical reflection of
media-related offerings among children, as it may be the case that some parents
might lack substantial resources and competences to perform this task.
Media-ethical considerations play a particularly important role in the development of brand worlds since the emotional response, especially through images, often
undermines the cognitive control of the recipient.
10.8
Conclusion
As the contribution shows, the development of emotional brand worlds is very
important in today’s constantly changing communication conditions. Companies
must operate continuous change management as part of their communication policy
and adapt their communication mix to the changing communication landscape.
Unique and holistic emotional brand worlds that include a variety of different
media, but still convey a uniform, consistent, and attractive image for the target
group, are an important element for brands to survive in times characterized by
convergence of media and change.
10.9
Exercise and Reflexive Questions
1. Please define “brand world” and describe its components!
2. What are common mistakes in creating an emotional brand world? What steps
need to be taken?
3. Please describe good examples for brand worlds from current communication
campaigns and reflect on the question whether all products/services are suitable
for a brand world!
4. What is the relationship between integrated communication and the concept of
the “brand world,” where do you see differences and where commonalities?
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5. How do you evaluate brand worlds from an ethical perspective? What needs to be
considered from an ethical point of view?
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Sandra Diehl (PhD, Saarland University, Germany) is Associate
Professor and Head of the Department of Media and Communication Studies at the University of Klagenfurt, Austria. Her
research interests include CSR and health communication, international and intercultural advertising, as well as media and convergence management. For further information, please see https://
www.aau.at/en/media-and-communications/team/assoc-prof-drsandra-diehl/
Ralf Terlutter is Full Professor of Marketing and International
Management and Head of the Department of Business Management at the Faculty of Management and Economics of the AlpenAdria Universitaet Klagenfurt, Austria. He received his PhD from
Saarland University, Germany. His research interests include New
Media and Communication, Health Marketing and Communication, Corporate Social Responsibility, as well as Intercultural
Communication.
Chapter 11
Cross-Media Advertising in Times
of Changing Media Environments
and Media Consumption Patterns
Sandra Diehl, Isabell Koinig, and Rebecca Scheiber
Abstract The increasing flexibility to choose between media devices, the growing
availability of multiple digital platforms, as well as different converged devices and
services are just some of the most prevalent examples reflecting current changes in
the media industry. At the same time, these changes are not without implications for
consumers. Media multitasking or the use of multiple screens at the same time is one
characteristic of today’s media consumers. Against this background, we want to
discuss the advantages and opportunities for marketers when using multiple media in
their marketing efforts—following the concept of cross-media advertising. A report
on the concept’s major benefits and underlying theoretical mechanisms forms an
integral part of this chapter. To this end, we present research exploring the topic of
cross-media advertising’s effectiveness and derive some concrete recommendations
for marketers when it comes to choosing the most appropriate channel combinations.
Promising directions for future research efforts conclude our chapter.
11.1
Introduction
The media and communication industries present an environment of transformation,
given the massive changes occurring in these industries (Albarran, 2011). “[T]he
new media and communication markets evolving in the 21st century are driven by
convergence, the rapid expansion of consumer reception technologies, multiple
digital platforms for consumers to access entertainment and information, and
expanded business models” (Albarran, 2011, p. 64). Together with the emergence
of new media, consumers’ use of multiple media has become common (Lim et al.,
2015). “As consumers are getting skillful at simultaneous media use, advertisers are
growingly interested in the impact of synergy of effective cross-platform campaigns” (Lim et al., 2015, p. 464; see Terlutter & Ninaus, Chap. 13). Consumers
can get into contact with brands via different channels. These brand contacts are thus
S. Diehl (*) · I. Koinig · R. Scheiber
University of Klagenfurt, Klagenfurt, Austria
e-mail: sandra.diehl@aau.at; isabelle.koinig@aau.at; rebecca.scheiber@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_11
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not restricted to one single media channel anymore. Nowadays, they occur more and
more under multiscreen conditions and advertisers want to make use of consumers’
media multitasking patterns, which afford them with various benefits (see Langner &
Klinke, Chap. 9).
Regardless of whether consumers use multiple media at the same time or sequentially, the importance of the “cross-media” concept cannot be denied. The term refers
“to a concept for the use of at least two media channels for marketing media
products” (Wirtz et al., 2014, p. 219). Cross-media can refer to the marketing of
integrated advertising space including a company’s print, online, radio, and TV
platforms. In addition, the concept alludes to the distribution of content via different
media channels (Sjurts, 2011). Usage could further be convergent, meaning that the
same content is available across a variety of platforms (Diehl & Karmasin, 2013a).
At the same time, the use of cross-media facilitates a time-lagged, nonlinear consumption of content, which is the immediate result of more flexible, individualized
but also simultaneous (“parallel”) usage patterns (ARD-Forschungsdienst, 2012). As
consumers’ preferences are gradually shifting and moving toward the Internet,
consistent customer communication using different distribution channels can be
effective; at the same time, content cannot only be used efficiently across a variety
of platforms, but also references to other media channels and formats are enabled as
part of an “active-user guidance” (Schweiger, 2002). This caters to users’ varying
interests, allowing them to make selections that reflect their individual situations and
media consumption patterns (see Terlutter & Ninaus, Chap. 13). For instance,
studies have found that digital media are integrated into people‘s existing media
usage selection, that is, traditional forms of media content are not replaced but
extended by digital offerings (“complementarity” in use; Brüggemann, 2002).
New emerging online media, of course, exert a great influence on cross-media.
However, a cross-media concept should integrate traditional media channels as
well (Wirtz et al., 2014). The importance of combining both off- and online media
in cross-media advertising efforts will become obvious when looking at studies on
cross-media advertising effectiveness discussed in Sect. 11.4.
Having introduced the concept and importance of cross-media advertising in a
changing media environment, this chapter continues with the discussion of current
trends for cross-media advertising, such as media multitasking and multiscreening
and theoretical explanations of the benefits of cross-media advertising campaigns. In
the following, we will refer to studies dealing with the effectiveness of cross-media
advertising. The chapter then concludes with some practical recommendations on
the selection of channels for successful cross-media advertising and the presentation
of some promising directions for future research.
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11.2
191
Trends in Media Usage with Relevance to Cross-Media
Advertising: Multiscreening and Multitasking
Several studies confirm the prevalence of using multiple screens at the same time. In
their study conducted in the Netherlands, Segijn et al. (2017) found that almost 60%
of the respondents multiscreen at least once and on average 3 days a week. The
combinations of TV–smartphone, TV–laptop, and TV–tablet were the most common
combinations. In 2019, 35% of US respondents also reported using their smartphone
while watching TV (Statista, 2019). Linked to these figures, the prevalence of a
“second screen” becomes obvious. According to a study by Nielsen (2013), mobile
devices are gaining importance in our daily TV routines. Nearly half of the
smartphone and tablet owners surveyed used their devices as second screens while
watching TV. Most often, for example, tablet owners preferred to do general Web
searches (76%) with their second screen. However, almost half of the tablet owners
indicated that they look up information related to TV content too.
Previous research has already outlined important effects and implications of
media multitasking for advertising. Segijn et al. (2020) investigated multiscreeners’
social media use, chatting activity, and information search when using their
smartphones, tablets, laptops, and computers while watching the Eurovision Song
Contest live. Higher perceived relatedness of respondents’ multiscreen activities to
the TV show resulted in higher attention to the show. In turn, the more involved
multiscreeners were with the TV show, the more attention they paid to the commercial break that followed the Song Contest. This also led to enhanced memory and
persuasion. Given these findings, related multiscreening should be strongly considered by advertisers since, in this case, people’s involvement with the program spans
the commercial break, too. In another study, Segijn and Voorveld (2020) focused on
the potential of synced advertising—a personalization advertising strategy. “Synced
advertising is the practice of monitoring people’s current media behaviour and using
the collected information to show people individually targeted ads based on people’s
current media behaviour across media” (Segijn, 2019, p. 59). An example of synced
advertising might be the following: a celebrity talks about her holiday in Los
Angeles while appearing on a TV show. While watching the TV show and browsing
a website on the smartphone, a banner ad appears on the website, which displays an
offer for flight tickets to Los Angeles (Segijn, 2019). Segijn and Voorveld (2020)
could show that synced advertising resulted in more positive brand attitudes when
compared to users who were not exposed to synced advertising. Nonetheless,
whether participants saw a tablet ad before, simultaneously to, or after a TV
commercial did not impact brand attitudes. This implies that showing synchronized
ads both in real time and with a short delay is effective. Hoeck and Spann (2020)
emphasized the relevance of mobile ads to overcome potential negative effects of
multiscreening. While people were watching a video on desktop computers simultaneously to answering questions on their smartphones, an additional mobile ad
weakened the negative effect when (1) the mobile ad contained the same brand as the
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desktop device, (2) was shown sequentially or simultaneously, (3) was static, and
(4) nonclickable.
11.3
Advantages of Cross-Media Advertising and Their
Theoretical Basis
Wirtz et al. (2014) identified business-related drivers of cross-media like higher
opportunities to increase revenue (e.g., via multiple use of media content), lower
marketing costs (e.g., economies of scale and scope), and brand transfer (e.g.,
branding possible across all channels). The multiple use of content also leads to
information optimization in terms of production, editing, and distribution (Hass,
2006). Lobschat et al. (2017) detected certain cross-channel effects for firms that
mostly sell offline. For nonrecent online consumers who had not recently visited the
company’s website, banner and TV ads resulted in a higher number of website visits
and led to an indirect increase of offline sales through website visits. Similarly,
Osinga et al. (2019) advise firms to use mobile banner advertising to increase offline
sales. The campaign presented to consumers resulted in a 2% uplift in offline sales.
The insights provided by Lobschat et al. (2017) and Osinga et al. (2019) imply that
ads in one channel may exert a positive influence on another channel.
In literature, several other benefits are mentioned, the most important ones being
(1) variety effects, (2) synergy effects, (3) repetition variation effects, and (4) target
group extension.
1. Variety effects are worth mentioning as multichannel marketing offers a greater
utility value to customers, leading to greater competitive advantages. For example, more content and more opportunities to get in contact with the firm are
provided and the combined utilization of mobile and Internet channels in the
media mix enhances the ubiquity regarding the location and time of access.
Another important benefit concerns the provision of a variety of sensual stimulations to enhance the customers’ hedonic experiences. Senses like taste and smell
are limited to physical channels, whereas stimulating senses of sight and sound
can best be achieved with digital media. Finally, as each channel has its own
strength, marketers can meet customers’ preferences even better (Chen &
Lamberti, 2016), while, at the same time, reducing wear-out effects.
2. Closely related to variety effects are synergy effects. Research exploring the
effects of cross-media is dominated by studies on synergy (Voorveld et al.,
2018). The effect of synergy implies that there is an added value of one medium
as a result of the existence of another medium. Their combined effect is greater
than the sum of their individual effects (Naik & Raman, 2003). Media synergy’s
positive effect has been proven by several studies that have also relied on
encoding variability theory (e.g., Dong et al., 2017; Dong et al., 2018; Dens
et al., 2018) and the multiple source effect (e.g., Chang & Thorson, 2004; Dens
et al., 2018; Dong et al., 2017, 2018; Huang, 2016; Lim et al., 2015) to explain the
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mechanism behind synergy effects. Harkins and Petty (1981) first confirmed the
positive influence of using multiple sources on persuasion (multiple source
effect). More message sources can induce individuals to think more strongly
about the message. However, this increase in cognitive reflection also depends
on the quality of the message. In a follow-up study, Harkins and Petty (1987)
provided an explanation as to why multiple sources enhance recipients’ message
processing. When information is presented by multiple sources, people perceive
the information to come from independent sources and thus to be worthy of
further processing. A study by Voorveld et al. (2011) also confirmed that multiple
source perception as psychological process was present when people were
exposed to cross-media campaigns. Multiple source perception influenced the
campaign results positively. This psychological process led to a more positive
attitude toward the brand and increased purchase intention when people were
exposed to a cross-media condition as compared to a single medium condition.
Encoding variability theory posits that multiple media have the potential to create
a larger memory network in the brain than single media campaigns
(Stammerjohan et al., 2005). When people are exposed to information more
frequently (Burnkrant & Unnava, 1987) and information is presented through
different media, messages are encoded in different ways, which leads to an
improved information retrieval.
3. Repetition variation effects: Further concepts that help to understand the effects
of using multiple media for advertising purposes include repetition variation
theory and image transfer. Image transfer (Voorveld et al., 2011) occurs when
people view a second ad and imagine or mentally replay—in their minds—a
previously seen ad during this reception. In this regard, Edell and Keller (1989)
analyzed the process and outcome of radio replay. This phenomenon occurs once
consumers view a TV ad and later hear the audio track of that TV element as radio
commercial. In their experiment, the authors were able to show that participants
replayed the video of the TV ad mentally. Related to repetition variation theory,
Huang (2020) explored platform and content variation on social media and
reported higher levels of experienced pleasure among participants who were
exposed to multiple social media messages when compared to using a single
platform. Following Vandeberg et al. (2015), variability is the key to successful
cross-media campaigns. The processing of information via many different media
results in more variability in the encoding and retrieval of the information in
contrast to (repeatedly) processing information in a single medium.
4. Target group extension: By utilizing messages via multiple channels, new target
audiences that differ in their media preferences and media usages can be reached
as well; at the same time, new content can be continuously added in innovative
ways or deepened through offerings on different platforms, for example, crossmedia storytelling. As such, communication efficacy can be increased
(Brüggemann, 2002; see Terlutter & Ninaus, Chap. 13 and Langner & Klinke,
Chap. 9).
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State of Research in Cross-Media Advertising
It is important to learn more about how exactly cross-media advertising efforts can
benefit marketers. When reviewing recent literature, it becomes obvious that
scholars have devoted their research to studying the combination of off- and online
media, but also a trend toward combining different online media can be noted.
11.4.1
Offline–Online Media Combinations
The following two studies (Bharadwaj et al., 2020; Voorveld et al., 2018) explored
cross-media effects on social media when using offline media. Bharadwaj et al.
(2020) looked at how paid TV ads and posts on brand-owned social media sites
contribute to the likability of ads. To this end, Super Bowl advertisements and the
Facebook content of the advertised brands were analyzed as TV viewers of the game
were also found to post a lot of content on social media regarding the ads. The effects
found reveal that both, traditional and social media advertising, exert an influence on
viewers’ responses. TV advertising contributed about 60% to ad liking, while
Facebook posts contributed about 40%.
Similarly, Voorveld et al. (2018) emphasized the importance of offline ads as an
important driver of consumers’ online brand engagement on Facebook. Through an
analysis of 45 Dutch brands of various types, the relationship between their advertising spending in different offline media (TV, radio, newspapers, magazines, trade
publications, and out-of-home), and their reach and engagement with their brand
pages on Facebook was explored. Results showed that different offline media
influenced different forms of consumers’ online brand engagement. More concretely, organic reach—users who see content of a page via unpaid distribution
(Facebook, 2017)—was positively influenced by TV, newspapers, and out-of-home
media. Crossover effects helped to increase the number of unique users. In contrast,
magazines had a negative effect on organic reach, whereas ads on Facebook—via
paid reach where users are reached by a page’s advertising on Facebook (Facebook,
2017)—influenced the organic reach of Facebook brand pages positively. As for
viral reach—users who see content of a page as friends have engaged with the
content before (Facebook, 2017)—TV was the only offline medium that drives this
type of reach. Advertising on Facebook was also identified as a driver for viral reach
and, in addition, positively influenced the number of likes of a brand page. A positive
influence of using offline media to increase online brand engagement in the form of
likes could not be confirmed. Based on the findings and the importance of TV,
newspapers, out-of-home media, and Facebook advertising on various forms of
online brand engagement, advertisers are advised to invest more money in these
advertising channels.
Another study that explored the effect of TV ads on online responses was
conducted by Du et al. (2019). Their study underpinned the effectiveness of TV
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ads in leading to different immediate online responses, such as brand and price
search.
Further research focusing on the combination of various web channels and offline
media (Chang & Thorson, 2004; Huang, 2016; Lim et al., 2015; Russo et al., 2020)
also supports the effectiveness of cross-media campaigns. Huang (2016) scrutinized
the created synergy effect when distributing ad messages via text messages and web
video. The positive effect of media synergy, by using these two media to distribute
ads, was especially pronounced for unfamiliar brands. Media synergy here led to
increased message credibility and created more positive thoughts in comparison to
ads that were repeated in only one single medium (e.g., only via the SMS channel).
Based on these findings, especially new brands are recommended to apply crossmedia ad campaigns to harness the potentials of media synergy.
Russo et al. (2020) uncovered that a multichannel campaign in combination with
radio can elevate campaign success. Results suggest that previous exposure of
participants to an ad on the radio enhanced the effectiveness of the same ad as
broadcasted on TV and on the web. Participants who were exposed to the radio ads
before watching the TV ads showed more intense and positive emotional responses
to the TV ads. In addition, participants who had been previously exposed to the radio
ads also paid greater attention to the same brand in a web banner and on TV.
Focusing on the combination of advertisements aired on TV and shown on
webpages, prior research conducted by Chang and Thorson (2004) also showed
the advantages associated with synergy when combing these two media. Effects
found related to the positive synergy effect of presenting ads first on TV and then on
webpages. This use of multiple media also led to higher attention, higher perceived
message credibility, more positive thoughts, and higher processing levels when
compared to showing ads repeatedly in one single medium. A study by Lim et al.
(2015) also provided new insights into combining traditional and mobile devices.
The synergy effect of Internet–television–mobile TV (e.g., Digital Media Broadcasting) could be confirmed in this study, not only enhancing perceived message, ad
and brand credibility but also leading to positive effects on cognitive responses,
attitude toward the brand, and higher purchase intention.
Exploring the combination of TV, Internet banners, and print magazines, Dens
et al. (2018) accounted for people’s individual and overall media usage. Consumers’
combined usage of TV, magazine, and the Internet contributes to enhanced advertising responses when compared to single-medium use. However, this effect was
only present for heavy media users.
11.4.2
Online–Online Media Combinations
Dong et al. (2018) set out to explore synergies created by online multimedia since
research in this field is missing. More concretely, the authors investigated the
combination of online broadcast media (OBM) in the form of online banner ads
and online interactive media (OIM) represented by eWOM. Participants were
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exposed to the condition of combining both multimedia forms, on the one hand, and
the condition of repeating one of the two multimedia forms, on the other hand. The
effectiveness of online media synergy could be detected as ads shown in the synergy
condition improved source and brand credibility, attitude toward the brand, and
purchase intention. They also generated more positive thoughts about the brand. The
importance of online interactive media was also highlighted for practitioners: OIM
offer great benefits to cross-media advertising such as interactivity or a wide reach of
consumers.
In a prior study by Dong et al. (2017), the advantage of synergy effects provided
by the combination of online media when compared to traditional media has been
emphasized as well. The authors point out important implications for marketers to
leverage the advantages of using multiple online media for advertising purposes.
Certain characteristics have specific effects in this regard. “Complementarity of
contents” had the strongest effect on message strength. This implies that advertisers
are advised to provide users with appealing content, which has the potential to grab
customers’ interest and attention, deepen their understanding, and attract them to the
brand. “Diversity of sources” had the strongest effect on the perceived credibility of
the ad. This implies that information from multiple sources creates the impression
among consumers that the presented information is useful. In the next chapter, we
will discuss some recommendations for successful cross-media advertising.
11.5
11.5.1
Recommendations: Channel Use in Cross-Media
Advertising
TV Is Still One of the Most Important
Advertising Media
Drawing from the insights offered by previous studies exploring the effectiveness of
cross-media advertising campaigns, what becomes obvious is their focus on the
offline medium TV in combination with online media. Research in this regard does
not neglect to include traditional offline media into the cross-media mix for advertising purposes. The studies’ focus on TV is not surprising either since TV is still an
important advertising medium. Revenues generated by TV advertising worldwide
are expected to further increase and reach 177.7 billion US dollars in 2023 (Statista,
2020a). In addition, prior research has noted some benefits linked to advertisements
broadcasted on TV. Danaher and Dagger (2013) compared the relative effectiveness
of multiple media, and though television is among the most expensive media for
advertisers, this expense seems to pay off. The authors could support the effectiveness of television advertising most strongly impacting sales and profit—next to
catalog and direct mail.
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197
Internet Advertising on the Rise in Cross-Media
Strategies
Advertisers still believe in the brand-building potential of the medium TV. However,
advertisers are advised to be cautious (Draganska et al., 2014) as Internet advertising
has the same capabilities to build brands, especially when taking preexisting brand
knowledge into account. Based on the latest figures (Statista, 2020b), a shift toward
spending most of the advertising budget on digital efforts (44.5%) seems to have
become commonplace on a global basis now. The findings provided by Dong et al.
(2017, 2018), showing the benefits of combining different online media, account for
the trend of implementing digital advertising. Marketers are advised to use a
combination of both media (Internet and TV) for their advertising efforts. As
discussed in Sect. 11.4.1, several scientific studies have shown that it is advantageous to combine traditional and digital media. These findings were confirmed in a
more practice-oriented study on cross-media advertising effectiveness conducted by
Research Now on behalf of the Interactive Advertising Bureau (IAB, 2017). They
analyzed the cross-media campaigns of a car brand and a well-known food brand.
Insights on the effectiveness of these campaigns were also backed up by three
additional case studies from retail, finance, and the media industry. Overall, findings
imply that by including digital ads in traditional campaigns brand impact can be
enhanced. To increase brand lift, digital media and TV have been identified as the
best channel combination (see Diehl & Terlutter, Chap. 10).
11.5.3
Integrating Additional Media into Cross-Media
Campaigns
Besides the arguments presented for using TV and Internet in cross-media advertising, advertisers should not forget about other media channels’ unique advantages.
The choice of media then depends on the goals of the campaign. Kotler et al. (2009)
outlined the profiles of major media types and presented their advantages. With
newspapers, a good local market coverage can be achieved, and they enjoy high
believability. Similarly, magazines provide credibility and prestige, while TV
enables high attention and reach, and yellow pages achieve wide reach, too. Outdoor
ads are beneficial for high repeated exposure. Newsletters offer a high level of
selectivity and a target group-specific approach, whereas radio succeeds due to its
high geographic and demographic selectivity and low costs. Brochures and direct
mail provide flexibility. In addition, direct mail improves personalization and telephone efforts offer an opportunity to give ads a personal touch. Finally, the Internet
affords advertisers high selectivity and possibilities for interaction. Online advertising that can be found on websites, social media tools, or search engine results pages
(Van Looy, 2016) enables a more personalized form of advertising than traditional
offline ads. For example, search engine result pages list ads that match users’
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keywords in search queries. Ads that are personally relevant to consumers are more
likely to be clicked.
11.5.4
Mobile Advertising Stands Out due to Big Data, AI,
and AR
Mobile marketing is conceptually different from traditional marketing strategies
(Tong et al., 2020) due to its increasing personalization possibilities. Nowadays,
marketers can collect hyper-context information via mobile devices’ built-in GPS
(see Peng & Okazaki, Chap. 26). Advertisers can design more personalized pricing
and promotion strategies, for example, based on the locations in which consumers
use their mobile devices and whether they use them alone or with somebody else.
Together with Big Data and Artificial Intelligence (AI), marketers can now predict
consumer behaviors more precisely. Companies that want to maintain their existing
market shares (Turban et al., 2018) have to invest in the mobile market given the
rising traffic and users in this market. Smartphones and tablets nowadays also
support augmented reality (AR) technology (Spanke, 2020) with which digital
information can be placed into the real world of users. For example, with the mobile
phone game “Pokémon Go,” virtual creatures appear in the player’s real word. AR
seems to be an effective tool for advertising efforts as well: Haile and Kang (2020)
found a positive influence of mobile augmented reality on purchase intentions.
Yaoyuneyong et al. (2016) could show that AR hypermedia print ads—where
mobile devices are used to project virtual 2D images over print ads—were more
effective and perceived as more informative and novel when compared to, for
example, traditional print ads.
11.5.5
How to Link Online and Offline Media
To arrive at a successful multichannel campaign that combines online and offline ads
(Langner et al., 2013), advertisers have to define each medium’s role in the campaign. For example, magazines are suitable to convey messages quickly to increase
brand awareness and image as gaze durations are low. Consumers who search for
information on a website are already more interested and involved, and they want to
receive more useful brand-related information. Thus, websites should be used to
convey brand-related information. With the help of “channel switch buttons,”
marketers can establish a link between different channels and increase their messages’ persuasive power by directing people’s attention from low- to highinvolvement media (e.g., from magazine ads to websites). QR codes are an example
of channel switch buttons that lead consumers from a magazine ad to the company’s
website. Channel switches can also be supported by using, for example, hyperlinks
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that lead a user from a company’s Facebook website to the company’s homepage. As
soon as consumers get more interested in an actual offer and want to contact the
brand, online to offline switch buttons become relevant, for example, filling in an
online order form to receive printed books or brochures.
11.5.6
Adapting the Cross-Media Advertising Campaign
to the Customer Journey
The customer journey can be understood “as the process a customer goes through,
across all stages and touch points, that makes up the customer experience” (Lemon
& Verhoef, 2016, p. 71; see Langner & Klinke, Chap. 9 and Terlutter & Ninaus,
Chap. 13). It is essential for firms to understand the customer journey as, nowadays,
customers can interact with firms via multiple media and touchpoints (Lemon &
Verhoef, 2016). The customer journey can be roughly divided into five phases,
which are presented in Fig. 11.1. Preferences for digital and physical touchpoints
may vary across each phase. Consumers may use the Internet (Dholakai et al., 2010)
to collect information, for example, about different car models. Online communities
can be visited to learn more about car owners’ experiences and prices. Following
that, negotiations can be carried out with car dealers face-to-face prior to the
purchase. Prior research also identified that some consumers preferred using offline
channels (Frambach et al., 2007) or physical stores (Wolny & Charoensuksai, 2014)
over online channels in the purchase phase. When filing complaints (Mattila &
Wirtz, 2004), consumers differed in their channel choice too. Consumers who
were looking for compensation preferred face-to-face or phone channels. However,
consumers who just wanted to express their dissatisfaction, did not want to receive a
reply from the firm, wanted to remain anonymous, and favored remote channels.
Certain instruments from business relationship marketing (Geiger &
Kleinaltenkamp, 2015) aim to increase customer loyalty to establish long-term
business relationships with consumers. For example, users can be surveyed regularly
to identify their needs or to ask them about their experience with the product.
A similar model, the AISAS purchase model by Dentsu (Kono, 2009), which is
based on the traditional AIDA model, helps to plan ad campaigns. First, consumers’
attention should be captured; second, they should become interested in the product;
following that consumers should search on the Internet for a product seen in an ad
(e.g., in newspapers); then an action should follow, for example, when consumers
buy the product right away on the Internet; and in the last phase, they might share
their experience on the Internet with others. With regard to consumers’ different
information needs during the purchase decision process, the theory of media richness
can help managers in the process of selecting appropriate advertising media. Daft
et al. (1987) postulated that different media have different capacities to handle
equivocality. Equivocality means confusion, lack of understanding, and involves
situations in which discussions and social support are needed. Rich media, like
Fig. 11.1 The customer journey. (Howard, 2014)
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201
face-to-face communication, allow for immediate feedback and enable faster understanding. Unaddressed documents, like bulletins, rank lowest in media richness as
they simply convey objective information to a large audience and are not focused on
the individual. In the context of mobile ads, Tseng and Wei (2020) found that media
richness has a great effect on consumers’ behavior in the early stages of attention,
interest, and search. Companies using mobile ads should chose media high in
richness—like video ads—for customers who are in the early stages of the decision
process to catch their attention and motivate them to search for more information. In
addition, when making purchase decisions related to high perceived risk products,
like a cell phone, customers preferred ads conveyed by media high in richness to get
more information on the product.
Recommendations for cross-media advertisers derived from these considerations
on media richness are that they should look at the specific situation and the context of
the consumers. Consumers’ need for information should be taken into consideration
when selecting the cross-media advertising mix. Practitioners should apply high
media richness ads, like interactive video, when advertising products with high
perceived risk.
11.5.7
Securing Integrated Communication & Storytelling
Across Channels
Messages across multiple media should follow the principles of Integrated Marketing Communication (IMC) (Mulhern, 2009) in order to ensure that all messages
convey the same positioning (Beard, 1997). The harmonization of strategies and
tactics across multiple channels is the key characteristic of IMC (Sheehan &
Doherty, 2001). When following IMC, campaign effectiveness can be increased,
leading to enhanced brand market performance and better financial performance of
brands (Luxton et al., 2015). Linked to IMC, “transmedia storytelling” might add to
a cross-media advertising’s campaign success as well. Based on Jenkins’ (2011)
understanding of transmedia storytelling in the entertainment business, Cronin
(2016) defined transmedia storytelling in relation to marketing as “a process
whereby elements of a brand story get dispersed systematically across multiple
media for the purpose of creating a unified and coordinated consumer experience
with the brand, with each medium making its own unique contribution to the
unfolding of the story” (Cronin, 2016, p. 89). With transmedia storytelling, target
audiences can get involved with narratives through many different media platforms
(Sangalang et al., 2013). Transmedia brand stories also tell a multifaceted story that
increases contact points and engagement with brands, allowing for the creation of
strong self-brand connections (Granitz & Forman, 2015). In addition, in order to
create a unique emotional brand profile, the cross-medial creation of a holistic brand
world is advisable that clearly positions and differentiates the brand from its competitors (see Diehl & Terlutter, Chap. 10).
202
11.5.8
S. Diehl et al.
Tailoring the Cross-Media Advertising Strategy
to the Target Group
A study exemplifying the complexity of tailoring message content has been
conducted by Dorie and Loranger (2020). Their analysis of channel usage and
spending patterns in a multichannel context focused on evaluating differences
between generations. Significant differences in the frequency of purchases across
generations were reported on different media channels. It turned out that Xennials
(born 1977–1983) used the five channels explored (mobile phone, tablet, computer
or laptop, social media, brick-and-mortar stores) most consistently for shopping.
Millennials (born 1984–2004) were less likely to shop via tablet once a week or more
and also did not prefer to shop in brick-and-mortar stores. To them, mobile and
social media were important. Generation X (born 1961–1976) used all channels for
shopping at different frequencies, whereas Baby Boomers (born 1943–1960) were
less likely to use mobile phones and social media for shopping. Similarly, differences in advertising attitudes (van der Goot et al., 2018) could also be detected for
different generations, though not for all media and in all six of the countries
surveyed. When differences were detected, the net generation (born 1978–1995)
favored ads published online, on TV, and in newspapers, while the newspaper
generation (born 1930–1957) was the generation least responsive to advertising.
The above findings show once more the necessity for marketers to evaluate
consumers’ individual preferences for channels. Different generations may not
respond equally to advertising in the same channels. These circumstances illustrate
how complex decision making has become for marketers, given the plethora of
combinations possible in today’s changing media environment.
11.5.9
Allocating Advertising Budget to Various Advertising
Channels
The allocation of resources across channels presents another challenge. Goos et al.
(2019) noted that advertisers lack knowledge on how much they should invest in
each medium in order to achieve the best synergy effects. Research (Dens et al.,
2018; Goos et al., 2019) has started to apply mixture amount modeling (MAM) to
explore the optimal mix of media. The mixture amount model is based on research
in, for example, agriculture. Just like farmers, who have to decide how much
fertilizer to use and what the exact composition should be, marketers have to think
about how much to invest in an ad campaign and how to distribute their investments
across media platforms (Goos et al., 2019). Dens et al. (2018) applied MAM to
explore cross-media synergy based on consumers’ media usage. Goos et al. (2019)
applied and further developed the methodology of mixture amount modeling. The
conceptualized model enables practitioners to decide on an optimal allocation per
channel by considering consumers’ response, the overall advertising efforts, media
11
Cross-Media Advertising in Times of Changing Media Environments and Media. . .
203
usage, and the target groups’ product category experience (how experienced consumers are in using and buying a certain product category) among other factors. In
the past, media planners have often tried to maximize the number of potential
contacts with the target group, while neglecting consumers’ responses or advertising
effects, thus not maximizing campaign effectiveness.
11.6
Directions for Future Research
In several recent studies (e.g., Segijn et al., 2020; Segijn & Voorveld, 2020; Hoeck
& Spann, 2020), we have seen promising outcomes for advertisers that are linked to
today’s media multitasking environment. However, a meta-analysis by Segijn and
Eisend (2019) exploring the effectiveness of media multitasking on advertising
highlights multitasking’s negative effects on cognitive outcomes, like brand recall,
brand recognition, and attention. In the same vein, some moderators were identified
that help to minimize these negative effects, for example, brand familiarity. Garaus
(2019) stresses the need for more research on exploring moderators and the mechanism of when media multitasking benefits or harms advertising effectiveness.
Promising future research directions propose a closer elaboration of additional
moderators like specific consumer characteristics or brand- and product-related
moderators (Segijn & Eisend, 2019).
In addition, Garaus et al. (2017) note limited studies exploring the advantages and
disadvantages of mobile marketing in cross-media campaigns. Studies in this area
could offer interesting results.
Previous studies identified the potential of the abovementioned mixture amount
model as a promising tool for advertisers to determine how much money to allocate
to each channel to achieve the most effective campaign results (Dens et al., 2018;
Goos et al., 2019). The unique characteristic of a mixture amount model is “that it
allows to investigate how the impact of the media usage mix changes with the total
amount of media usage” (Dens et al., 2018, p. 269). The model has been tested for
combinations of TV, print, and online video/banner ads (Dens et al., 2018) as well as
for magazines and TV (Goos et al., 2019). Future research is invited to apply the
model to incorporate more media, for example, to explore synergies relating to
people’s usage of various online sites like brand websites, review sites, and social
media (Dens et al., 2018) or to radio commercials (Goos et al., 2019).
With regard to the decision about which channels to use and combine for
advertising, Sect. 11.4 outlined the effectiveness of different channel combinations
based on previous research, which has shown that marketers should not hesitate to
combine traditional media, like TV, with new online media channels. Of course,
combining solely online channels might offer promising outcomes as well. No
matter whether advertisers chose to combine traditional offline with new online
media or online media with other online platforms, the use of online media in the
cross-media advertising channel mix should by no means be neglected. Further
research is needed with regard to the most effective social–media mix, as the effects
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of combining different social media channels are so far under-researched. Du et al.
(2019) also recommend exploring online responses triggered by other traditional
broadcast media like radio in order to complement TV-to-online spillover research.
As a last thought, we want to point out the future potential of cross-media
advertising especially against the background of convergence. Chakaveh and
Bogen (2007) stress the relevance of media convergence for companies in terms of
securing financial benefits. Via government regulations, media conglomerates have
been allowed to own various kinds of media (e.g., TV and radio stations, newspapers). With this, companies can also attract more advertisers, for example, by
providing package deals. Voorveld et al. (2013) emphasized the importance of
cross-media advertising as a solution to respond to the challenges posed by convergence, such as fragmented target groups due to the increasing availability of media
channels or less attentive target groups due to media multitasking among others.
Summarizing, cross-media advertising presents a promising form of advertising to
meet the requirements of changing media environments (e.g., due to convergence,
see Diehl & Karmasin, 2013b) and changing consumption patterns (e.g., media
multitasking) and should be considered an essential part of corporate change
management.
11.7
Exercise and Reflexive Questions
1. What does the concept of cross-media imply? What are the benefits of crossmedia advertising?
2. Please provide theoretical explanations for the advantages of cross-media
advertising!
3. Which important channel combinations have been outlined by scholars, and what
are the effects of these combinations?
4. Why is the traditional medium of TV still important to advertising practice?
5. Reflect on your own media consumption behavior. To what extent is media
multitasking prevalent in your daily life? What are beneficial outcomes of
media multitasking for you and for advertisers? Are there also negative outcomes
linked to media multitasking?
6. Imagine you are a media marketing manager who has to decide which channels to
use for your upcoming cross-media advertising campaign. Which tools or ways of
determining the best channel combinations would you use? Think of other
potential possibilities and tools besides the outlined mixture amount modeling
technique.
7. Can you think of a cross-media advertising campaign that has especially caught
your attention that you still recall? Which channels were utilized in the campaign
and what other factors (e.g., content, creativity) of the campaign do you think
contributed to the campaign’s success?
11
Cross-Media Advertising in Times of Changing Media Environments and Media. . .
205
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(pp. 117–133). Springer.
Voorveld, H. A. M., Araujo, T., Bernritter, S. F., Rietberg, E., & Vliegenthart, R. (2018). How
advertising in offline media drives reach of and engagement with brands on Facebook. International Journal of Advertising, 37(6), 785–805. https://doi.org/10.1080/02650487.2018.
1454703
Wirtz, B. W., Nitzsche, P., & Mory, L. (2014). Cross-media marketing strategies. In Y. Liu & R. G.
Picard (Eds.), Policy and marketing strategies for digital media (pp. 218–232). Routledge.
Wolny, J., & Charoensuksai, N. (2014). Mapping customer journeys in multichannel decisionmaking. Journal of Direct, Data and Digital Marketing Practice, 15(4), 317–326. https://doi.
org/10.1057/dddmp.2014.24
Yaoyuneyong, G., Foster, J., Johnson, E., & Johnson, D. (2016). Augmented reality marketing:
Consumer preferences and attitudes toward hypermedia print ads. Journal of Interactive Advertising, 16(1), 16–30. https://doi.org/10.1080/15252019.2015.1125316
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Sandra Diehl (PhD, Saarland University, Germany) is Associate
Professor and Head of the Department of Media and Communication Studies at the University of Klagenfurt, Austria. Her
research interests include CSR and health communication, international and intercultural advertising, as well as media and convergence management. For further information, please see https://
www.aau.at/en/media-and-communications/team/assoc-prof-drsandra-diehl/
Isabell Koinig is a Postdoctoral Researcher at the Department of
Media and Communication Studies at the University of Klagenfurt, Austria. Her research interests predominantly concern the
fields of health communication (pharmaceutical advertising,
eHealth/mHealth, health for sustainable development, and wearables), intercultural advertising, organizational health, as well as
media and convergence management. For further information,
please see https://www.aau.at/en/media-and-communications/
team/postdoc-ass-mmag-dr-isabell-koinig-bakk-phil/
Rebecca Scheiber is University Assistant and PhD candidate at
the Department of Media and Communication Studies at the
University of Klagenfurt, Austria. Next to media and convergence
management, her research interests predominantly regard social
media’s influence on body image and users’ eating behaviors, and
health communication and sustainability.
Chapter 12
The Relevance of Social Media
and Corporate Influencers as Potential
Change Agents in Corporate
Communications
Julia Durau
Abstract Social media influencers have developed into a new form of endorsers for
brands and companies. Successful social media influencers represent effective brand
endorsers for internal and external corporate communications who have the ability to
shape and change their followers’ behaviors with their content. Thus, social media
influencers might be considered as change agents who are able to effectively
communicate change processes to their followers. This chapter discusses the role
of social media influencers and influencer marketing in corporate communications.
First, recent influencer marketing research findings are presented. Second, current
issues in social media influencer effectiveness research are outlined. The chapter
concludes with directions for future research.
12.1
Introduction
Social media influencers are popular individuals who share content online with a
large number of followers (Freberg et al., 2011; De Jans et al., 2020; De Veirman
et al., 2017) through their social media accounts (e.g., Instagram, YouTube). By
sharing information as well as their daily lives on social media, they create high
engagement with their typically large and loyal audience (e.g., through likes and
comments). Social media influencers are specialists in a certain area of interest, such
as fashion, fitness, beauty, or technology, who know and share the trends in their
specialized fields. According to a study by HypeAuditor (2020b), the three biggest
influencer categories are beauty & fashion, fitness & yoga, and music, while
technology & science, books & literature, and luxury goods are the three smallest
influencer categories (HypeAuditor, 2020b).
Social media influencers have developed into a new and effective form of brand
endorsers (Evans et al., 2017). Through their social media profiles and as experts in
J. Durau (*)
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: julia.durau@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_12
211
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their area of interest, social media influencers constitute a personal brand themselves
(De Veirman et al., 2017; Khamis et al., 2017; see Langner and Klinke, Chap. 9).
Brands have already noticed the huge potential of social media influencers as brand
endorsers in corporate communications. The recognition of social media influencers
as effective brand endorsers is reflected by a rapid growth of influencer marketing
and increasing influencer marketing budgets (Mediakix, 2019). In fact, influencer
marketing has seen a continuous increase in the past years and is estimated at 9.7
billion USD in 2020 (Influencer Marketing Hub, 2020b).
The German fitness influencer Pamela Reif is a good example for a social media
influencer turned into brand ambassador and entrepreneur. She started as an
influencer with 500,000 Instagram followers in 2015 and has become one of the
most-followed fitness influencers worldwide with more than 6 million Instagram
followers in 2020 (Gläsemann & Lau, 2019; HypeAuditor, 2020a). She works with
popular brands, such as Puma or Calzedonia, has her own food product collaboration, has published two books (Gläsemann & Lau, 2019), and launched her own food
brand in November 2020 (Naturally Pam, 2020).
Social media influencers are interesting for brands because they effectively
deliver brand messages to social media users (Kim & Kim, 2020). Influencers
work as ambassadors for a brand and create sponsored brand posts (e.g., display
and/or use the promoted product in the picture/video), mention and/or tag the
promoted product or brand in their posts, picture, or video, or participate in brand
events or advertising campaigns (Abidin, 2016; Boerman, 2020). Moreover, social
media influencers have a large reach and are perceived as credible, authentic, and
relatable by their audiences (Evans et al., 2017; Schouten et al., 2020; De Veirman
et al., 2017).
For brands, such as the sports brand Puma, social media influencers like Pamela
Reif have turned into important brand ambassadors as they transfer brand messages
to the target group in a trusted and authentic way, create high engagement, and
influence purchase intentions of their followers, for instance, by wearing and
promoting a new sports fashion style (Gläsemann & Lau, 2019).
While social media influencers have certainly become important for advertising
purposes, they are also useful in strategic communication (Enke & Borchers, 2019).
Social media influencers can change the behaviors of their audiences, not only
regarding product recommendations, but also regarding lifestyle or personal changes
(Mediakix, 2020a). Still, little is known about the individual influencer’s role in
corporate change processes. Influencers might be suitable agents for communicating
change processes to their target groups. For instance, influencers might promote a
certain lifestyle and nudge their audiences toward taking up the promoted behavior,
for example, buy substantiable clothing, by wearing a shirt of the promoted (sustainable) brand as part of their outfit of the day (also called “ootd”). Moreover,
influencers in internal corporate communication, so-called corporate influencers, can
promote certain behaviors and accompany corporate change processes (Bergk &
Slomian, 2018), for instance, a new corporate strategy.
As outlined above, social media influencers have developed into important
endorsers for brands and companies. Based on a literature review, this chapter
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213
aims to explain the role of influencers in corporate communications and marketing
and their potential as change agents (Miller, 2019). First, this chapter summarizes
current research findings and trends in the field of influencer marketing with a focus
on the role and application of source credibility theory in influencers and on the
effects of influencers’ social media brand content. Second, the chapter outlines
current issues in social media influencer effectiveness research by discussing the
role of different social media channels and influencer types for social media
influencer effectiveness as well as the role of social media influencers in change
processes and internal corporate communications. The chapter concludes with
directions for future research.
12.2
Theoretical Background and State of the Art
of Influencer Research
Successful social media influencers can shape their audiences’ attitudes and behavioral intentions and use their popularity and large reach for marketing purposes, for
instance, by promoting products or brands (De Jans et al., 2020; Kay et al., 2020; De
Veirman et al., 2017). As social media influencers have become increasingly popular
for advertising purposes (Voorveld, 2019; see Diehl et al., Chap. 11), influencer
marketing has developed into a popular research topic in the past years. Research to
date has examined different social media influencers and influencer marketing
aspects, such as social media influencers in advertising and as brand endorsers
(e.g., De Jans et al., 2020; Djafarova & Rushworth, 2017; Kay et al., 2020; Schouten
et al., 2020; Wiedmann & von Mettenheim, 2020), strategic communication (e.g.,
Enke & Borchers, 2019), or health communication (e.g., Pilgrim & Bohnet-Joschko,
2019).
In the following, two major theoretical influencer marketing research directions
are outlined: first, research results on source credibility theory and social media
influencer characteristics are presented. Second, influencers’ advertising effectiveness and consumer outcomes in relation to advertising and sponsorship disclosure in
influencers’ social media posts are discussed.
12.2.1
Important Social Media Influencer Characteristics
A social media influencer’s source credibility is a concept that has been widely
examined in social media influencer marketing research. Source characteristics are
important because brand communication often occurs through brand endorsers, such
as social media influencers, and the brand endorser’s characteristics are likely to
influence consumer responses (Voorveld, 2019). Research on social media
influencers has so far applied the constructs of celebrity endorsement and opinion
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leadership to this comparatively new research area. Kay et al. (2020) argue that
theories and concepts of opinion leadership and celebrity endorsement need to be
tested for their suitability in a social media influencer setting. Yet, based on the lack
of a common influencer theory (Gross & von Wangenheim, 2018) and the increasing
number of social media influencer studies that have applied traditional source
credibility constructs and reported significant findings, the use of the constructs
seems applicable in this research field.
According to source credibility theory, endorsers’ effectiveness in delivering
messages to their target audience depends on several factors. In advertising research,
endorsers are mostly defined by their trustworthiness, expertise, and attractiveness
(Ohanian, 1990). Considerable empirical research in traditional media on effects of
opinion leadership and celebrity endorsements has confirmed the importance of
these three source credibility factors for successful advertising and brand communication (Amos et al., 2008; Bergkvist & Zhou, 2016; Erdogan, 1999). Consumers
who perceive endorsers as trustworthy, as experts, and as attractive are more likely to
positively evaluate brands and products (Bergkvist & Zhou, 2016; Erdogan, 1999).
Influencer marketing research has largely examined effects of source credibility on
social media influencers’ effectiveness. However, even though trustworthiness,
expertise, and attractiveness seem important for a social media influencer’s effectiveness, research results imply a varying significance of these constructs.
Trustworthiness has been largely determined as important for a social media
influencer’s effectiveness regarding different brand aspects and consumer-related
outcomes by prior research. Research findings suggest that an influencer’s trustworthiness has positive effects on brand trust and brand satisfaction (Wiedmann & von
Mettenheim, 2020), brand attitude (Martensen et al., 2018), brand awareness and
consumers’ trust in branded content (Lou & Yuan, 2019), attitude toward the ad and
the product (Schouten et al., 2020), purchase intention (Djafarova & Rushworth,
2017; Weismueller et al., 2020), and parasocial interactions between weight-loss
vloggers and viewers (Sakib et al., 2020). Conversely, Balabanis and Chatzopoulou
(2019) neither found a positive effect of the social media influencer’s trustworthiness
on perceived influence nor on purchase intention.
Attractiveness seems to be an important social media influencer characteristic,
too. The construct was found to positively affect brand trust, brand satisfaction and
the influencer’s persuasiveness (Wiedmann & von Mettenheim, 2020), brand awareness and followers’ trust in branded content (Lou & Yuan, 2019), purchase intentions (Djafarova & Rushworth, 2017; Weismueller et al., 2020), and parasocial
interaction (Sakib et al., 2020).
Expertise yielded mixed results regarding its effectiveness for several brandrelated constructs. Wiedmann and von Mettenheim (2020) did not find an effect of
expertise on brand trust and brand image, and only a marginal effect on brand
satisfaction. Contrary to trustworthiness and attractiveness, expertise enhanced
neither followers’ trust in branded content (Lou & Yuan, 2019) nor purchase
intentions (Djafarova & Rushworth, 2017). Other research found positive effects
of expertise on the influencer’s persuasiveness and, in turn, the followers’ brand
attitude (Martensen et al., 2018) and brand awareness (Lou & Yuan, 2019). Research
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215
by Weismueller et al. (2020) suggested that the social media influencer’s expertise
positively influenced the followers’ purchase intentions. Ki and Kim’s (2019) study
demonstrated that the extent to which an individual evaluates an influencer as
demonstrating expertise was positively associated with the perception of the
influencer as a taste leader.
Besides trustworthiness, expertise, and attractiveness, similarity (Martensen
et al., 2018; Shan et al., 2019), authenticity (Audrezet et al., 2020; Pöyry et al.,
2019), parasocial interaction (Lee & Watkins, 2016; Reinikainen et al., 2020; Sakib
et al., 2020), and identification (Schouten et al., 2020) have been examined as
determinants of social media influencers’ effectiveness in social networks as well.
The social media influencer’s perceived similarity with the consumer enhanced
the influencer’s persuasive intent, which positively affected the individual follower’s
brand attitude (Martensen et al., 2018). Shan et al.’s (2019) findings in a Chinese
social media context suggest that a higher similarity between the social media
influencer’s image and the consumer’s self-image leads to a more favorable brand
attitude and purchase intention.
Parasocial interaction (PSI) was found to enhance trust in the social media
influencer’s brand recommendations and simultaneously reduced possible consumer
uncertainties in a study on the moderating role of audience comments on the social
media platform YouTube (Reinikainen et al., 2020). PSI further increased the
transfer of the perceived trust from the social media influencer toward the promoted
brand. A study by Sakib et al. (2020) suggests that weight-loss vloggers evaluated as
highly credible and attractive increased the PSI of the viewers. With high PSI,
viewers were more likely to follow the advocated health behavior, resulting in higher
motivation and feelings of empowerment.
Regarding the authenticity and credibility of social media influencer messages
and product recommendations, as compared to traditional advertisers, research
findings suggest that social media influencers’ messages are perceived as more
authentic and credible as influencers are considered as peers who share the opinions
and experiences of their followers (Jin & Phua, 2014; De Veirman et al., 2017).
Schouten et al. (2020) compared the advertising effectiveness of celebrity and
social media influencer endorsements and showed that influencers are perceived as
more trustworthy, more similar, and provide a higher identification for users than
celebrities, suggesting that social media influencers are more effective brand and
product endorsers than celebrities.
Summarizing, a trustworthy, attractive, similar, and authentic social media
influencer with high PSI seems to be effective for enhancing brand-related variables
and consumer outcomes. Although most of the studies discussed here suggest
positive effects of the selected source credibility variables, there is still room for
more research to determine which variables are most important for different social
media influencer types in different contexts.
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Advertising Effectiveness of Social Media Influencers:
Disclosure Matters
Besides examining how influencer-related variables influence consumer outcomes
and behaviors, examining effects of influencers’ branded social media content has
generated increasing interest from advertising scholars. Product and brand promotions are part of social media influencers’ content. Branded content is often naturally
embedded in the social media feed, for instance, in the Instagram feed (De Jans et al.,
2020). Hence, followers and consumers often do not recognize sponsored brand
content as it appears more authentic due to its natural integration in the social media
platform’s feed. Hence, sponsored content might be difficult to differentiate from
nonsponsored content (Kim & Kim, 2020).
Delivering branded or sponsored content to their followers is a key characteristic
of social media influencers and represents the business model of influencer marketing. To date, there is no standardized way of how to disclose sponsorship and how to
aid consumers in identifying advertising across social media platforms (Amazeen &
Wojdynski, 2018). Advertising disclosure regulations regarding influencer marketing are gradually becoming established on a country-by-country basis. In general,
both companies that advertise on social media, and influencers who create sponsored
social media posts, are required to disclose advertising. Not disclosing sponsored
posts is likely to result in legal charges. Social media influencers must follow the
legal frameworks of their respective country. For instance, in Germany, a clear
labeling of advertising is required by German courts (Fuchs & Hahn, 2018; Knitter
& Sobottka, 2020). Sponsored posts cannot simply be disclosed with #ad, but rather
with German terms, such as “Werbung” (promotion) or “Anzeige” (advertisement).
The disclosure must be placed at the beginning of the message for a visible
disclosure. Similarly, the US-American Federal Trade Commission (FTC) claims
that the disclosure of sponsored content must be noticeable and placed at the
beginning of the message (Federal Trade Commission (FTC), 2019). In videos, the
disclosure must be included in the video itself, not only in the description. On
Instagram, social media influencers can either tag a business in their posts or use
hashtags for disclosure. Hashtags, for instance, #ad or #sponsored, are used frequently for disclosure (De Jans et al., 2020).
Empirical research examining effects of disclosures of social media influencers’
sponsored content has yielded important results. Interestingly, recent research results
did not suggest negative effects of sponsorship disclosure on brand attitude and
purchase intention in an influencer’s product review post (Kay et al., 2020; Stubb &
Colliander, 2019). The sponsorship disclosure was instead evaluated as beneficial
for social media influencers. Earlier research by Evans et al. (2017) found that using
the hashtag #paidad might even increase consumers’ ad recognition in a sponsored
social media influencer post on Instagram. Ad recognition decreased when the
hashtags #sponsored or #sp were integrated. A clear and visible disclosure thus
positively affects ad recognition, but also decrease attitudes and behavioral
intentions.
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217
Findings by Boerman (2020) imply that a standardized disclosure on Instagram
increases ad recognition as compared to no disclosure. This effectiveness might be
due to the explicit wording as well as the position of the disclosure below the
influencer’s account name and above the picture.
Kim and Kim (2020) examined effects of social media influencer–product congruence (i.e., the fit between the influencer and the product) and sponsorship
disclosure on product attitude and advertising recognition as native advertising.
They also studied how social media users interpret the attributes and if congruence
moderates negative effects of sponsorship disclosure. Their findings suggest that a
higher congruence between the influencer and the product leads to a more positive
product attitude and to a lower advertising recognition that is indirectly affected by
congruence. A high influencer–product fit might thus increase consumers’ perceptions that the influencer honestly enjoys the product, which, in turn, lowers the
consumers’ recognition of the post as advertising. Moreover, when a post contains a
sponsorship disclosure, consumers are more likely to recognize the content as
advertising.
Kay et al. (2020) investigated effects of different influencer types, that is, macroand micro-influencers,1 and the disclosure of native advertising sponsorship on
consumers. According to their studies, micro-influencers are more likely to affect
consumers’ intentions and behaviors than macro-influencers. Sponsorship disclosure
increased purchase intentions particularly for micro-influencers. Moreover, microinfluencers seem to increase consumers’ product knowledge (Kay et al., 2020);
hence, micro-influencers seem more effective than macro-influencers. The authors
explain this finding with the persuasion knowledge model that describes that consumers try to overlook or resist persuasive attempts of advertising content (Friestad
& Wright, 1994). Macro-influencers are thus perceived as more persuasive than
micro-influencers due to their larger number of followers and popularity.
Summarizing, research findings suggest that sponsorship disclosures do not seem
to affect consumer outcomes and behaviors negatively. Although there is no generally applicable influencer marketing regulation yet, both social media influencers
and brands must be aware that sponsored posts always need a sponsorship disclosure
that meets the legal frameworks of their respective country (Kay et al., 2020; Stubb
& Colliander, 2019).
1
Kay et al. (2020) define micro-influencers as influencers with a smaller number of followers
(1000–100,000 followers) and macro-influencers as influencers with a larger number of followers
(100,0000–one million followers). See also Sect. 12.3.1.
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12.3.1
J. Durau
Current Issues in Social Media Influencer
Effectiveness Research
Effectiveness and Suitability of Different Social Media
Influencer Types
Social media influencers are usually characterized by a large number of followers
(Kay et al., 2020). Both scholars and practitioners largely categorize social media
influencers based on their number of followers. However, there is no consensus
among scholars and practitioners on the number of categories or the number of
followers per category. For instance, Kay et al. (2020) categorize influencers into
“macro-influencers” (larger number of followers: 100,0000–1 million followers) and
“micro-influencers” (smaller number of followers: 1000–100,000 followers). They
argue that academic research mainly distinguishes between macro- and microinfluencers, while a three-level categorization is less frequently applied. Conversely,
Boerman (2020) distinguishes between macro-, meso-, and micro-influencers.
Micro-influencers are regular users turned “instafamous” (less than 10,000 followers), meso-influencers are nationally famous, most often full-time influencers
(10,000–1 million followers), and macro-influencers are celebrity-like influencers
(more than 1 million followers). Similar to academic research and categorization,
practitioners’ influencer categorizations vary as well (see, e.g., Influencer Marketing
Hub, 2020b; Mediakix, 2020b).
All social media influencer segments are interesting for brands (Boerman, 2020).
Macro-influencers are particularly interesting because of their large reach and most
suitable for brands that aim at increasing awareness and visibility (Hatton, 2018).
Moreover, they are considered as more attractive, credible, and popular opinion
leaders (Jin & Phua, 2014; De Veirman et al., 2017). Conversely, micro-influencers
are of interest because of their expertise in their area of interest. They share higher
similarity with their followers and can thus be more effective in influencing consumer intentions and behaviors than macro-influencers (Kay et al., 2020). Brands
might benefit from working with micro-influencers because influencer marketing
costs are lower, they are easier to reach, more flexible, and have higher engagement
rates than macro-influencers (Influencer Marketing Hub, 2020b; Kay et al., 2020).
Regarding academic research results on the effects of micro- vs. macroinfluencers, Boerman (2020) did not find any significant differences between
micro- and meso-influencers regarding PSI or intentions of engaging with the
influencer’s post. Meso-influencers, who are typically more popular than microinfluencers, do not profit from their larger number of followers. Ad recognition was
also not affected by the influencer type. Similarly, Kay et al.’s (2020) research
findings suggest that micro-influencers are more effective than macro-influencers
regarding consumer outcomes, suggesting that micro-influencers rather than macroinfluencers should be considered as brand endorsers because fewer followers seem to
be more beneficial for brands. Interestingly, the findings by Kay et al. (2020) and
Boerman (2020) challenge previous research that implied that a larger number of
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The Relevance of Social Media and Corporate Influencers as Potential. . .
219
followers of a social media influencer increases the influencer’s effectiveness on
consumer outcomes (De Veirman et al., 2017; see Terlutter and Ninaus, Chap. 13).
Thus, more research on consumers’ perceptions and evaluations of the different
social media influencer types is needed (Boerman, 2020).
12.3.2
Effectiveness of Influencer Marketing on Different
Social Media Channels
Brand communication takes place across various social media channels (Voorveld,
2019). In October 2020, the most popular social media platform was Facebook,
followed by YouTube. Instagram was in sixth place, followed by TikTok (We Are
Social, Hootsuite, and DataReportal, 2020). Instagram has been ranked as the most
important influencer marketing channel (Mediakix, 2019). The importance of
Instagram for influencer marketing is reflected in academic research: social media
influencers and influencer marketing on Instagram have been widely studied in
different research contexts (e.g., Boerman, 2020; Breves et al., 2019; Casaló et al.,
2018; Djafarova & Rushworth, 2017; De Jans et al., 2020; Jin & Ryu, 2020; Kay
et al., 2020; Schouten et al., 2020). Fewer studies have examined social media
influencers on YouTube (e.g., Corrêa et al., 2020; De Jans et al., 2018; Lee &
Watkins, 2016; Stubb & Colliander, 2019; Stubb et al., 2019; Xiao et al., 2018).
Social media influencer research focusing on Facebook (e.g., Wiedmann & von
Mettenheim, 2020) and Twitter (e.g., Britt et al., 2020) is scarce, too. No study to
date has focused on social media influencers and TikTok, a platform that is particularly popular among children and teenagers (De Veirman et al., 2019).
On Instagram, two main advertising strategies are prevalent: sponsored brand
posts and sponsored influencer posts (De Jans et al., 2020). Sponsored brand posts
are posts by brands that pay Instagram to promote their brand to the desired target
group, such as to women interested in fashion or to men interested in sports. The
social media platform ensures that the specific target group receives the brand’s
content. Sponsored influencer posts are posts by Instagram influencers who have a
commercial deal with brands. Influencer marketing strategies on Instagram are
constantly developing. For instance, the social media platform recently implemented
Instagram Shopping in selected countries, where users can get additional information on a brand or product within a social media influencer’s post, including a link to
a website to purchase the product (Instagram, 2020).
Brand advertising on Instagram (i.e., brands pay the social media platform to
present their content to a target audience) automatically includes the disclosure
“sponsored,” which is placed below the brand’s name and above the posted brand
image. Recently, Instagram introduced the standardized disclosure “Paid partnership
with [brand].” This disclosure is highly visible and directly shows that the social
media influencer got paid by the brand. Once a business is tagged by an influencer,
the disclosure is automatically included in the post in a prominent position, that is,
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Fig. 12.1 Branded content on Instagram: three examples for “Paid partnership with [brand]” in the
feed and in stories. (Instagram Business, 2020)
below the influencer’s name and above the posted image, as a two-line or three-line
header (Boerman, 2020; De Jans et al., 2020; Instagram Business, 2020). The
disclosure can also be integrated in Instagram stories. Figure 12.1 displays three
examples by Instagram for branded content disclosures: a two-line header, a threeline header, and a story post (Instagram Business, 2020).
This standardized disclosure on Instagram has been found to be effective in
increasing ad recognition as compared to nondisclosure (Boerman, 2020). This
implies that a prominent advertising disclosure seems beneficial for both the social
media influencer and the brand.
12.3.3 Effectiveness of Social Media Influencers as Change
Agents
As previously stated, research results suggest that social media influencers can
effectively change human responses (De Veirman et al., 2017), such as attitudes
(e.g., attitude toward the product) and behaviors (e.g., purchase intentions). Social
media influencers share content, information, and recommendations that are of
interest to their followers and are likely to influence, or change, their followers’
attitudes and behaviors. Hence, influencers as brand endorsers and opinion leaders
might be considered as change agents (Miller, 2019). Change agents are persons
who exert influence on the decisions of others (e.g., consumers, clients, colleagues)
and steer them in the desired direction, mostly toward adopting new ideas, but also
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toward preventing undesired behaviors (Rogers, 2003). Influencers have already
been considered as change agents by practitioners (Miller, 2019; Levin, 2020).
However, the role or significance of influencers as change agents in corporate
communications has not been examined by academic research yet.
Due to the popularity of social media influencers, it seems reasonable to look at
influencers as change agents. While the social media influencer characteristics
mentioned in Sect. 12.2.1 largely refer to advertising effectiveness, particularly
knowledge (or expertise), authenticity, identification, and interaction are influencer
characteristics that seem important for influencers in strategic communication and
change processes (Miller, 2019). Similar to social media influencers, change agents
must possess the key characteristic of knowledge (i.e., expertise) as they are considered as peer experts in their specialized area of interest by their followers.
Moreover, influencer change agents have a close connection with their audience
whose members identify with them and are likely to listen to them about product and
purchase recommendations (see Langner and Klinke, Chap. 9). Due to the closeness
between the two parties, influencer change agents can quite simply mobilize their
followers and steer them in the desired direction, for instance, to adopt knowledge
about specific issues or to develop favorable attitudes toward a brand. Authenticity is
important, too. As influencer change agents can make use of storytelling by sharing
stories and personal experiences, they might be perceived as more authentic by their
followers. Moreover, influencers must be in touch with their followers regularly and
engage and interact with them in different ways, for example, through comments or
direct messages (Miller, 2019).
In corporate communications, influencers as change agents might be effective as
they possess the ability to influence their peers and guide them in the desired
direction. For example, in a company, internal influencer change agents might
nudge their audience (e.g., their colleagues) toward increasing sustainable behaviors
by reducing the use of plastic in the office. Social media influencer change agents
might cooperate with a sustainable company and share the company’s sustainable
message and products with their followers with the aim of changing their behavior
toward adopting a more sustainable lifestyle.
Brands have already recognized the potential of influencers for green and sustainable campaigns. Adidas, Volvic, or even the EU are examples for brands that
cooperate with influencers that identify with a sustainable and green lifestyle
(Kellershofen, 2020). In 2020, the sports brand Adidas launched an influencer
campaign, where sustainability influencers promoted a new type of sneakers
(“clean classics”). For example, the influencers @jette (104,000 followers) (Fig. 12.2) and @nanda_schwarz (195,000 followers) (Fig. 12.3) were
part of the campaign. Their branded Instagram posts integrate Adidas’ sustainable
message and their promotion of a sustainable lifestyle, which, in turn, might
influence their followers’ behaviors toward a more sustainable lifestyle.
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Fig. 12.2 Instagram post by influencer @jette for Adidas clean classics. (I‘mJette, 2020)
12.3.4
Effectiveness of Corporate Influencers as Change
Agents
While social media influencers as change agents appear to be a suitable tool to
influence consumers’ attitudes and behaviors, corporate influencers represent
another influencer type that seems relevant in change management. Corporate
influencers are members of an organization who act as influencers through their
social media accounts (Bergk & Slomian, 2018; Enke & Borchers, 2019). Corporate
influencers have a similar purpose to that of social media influencers: they represent
the company and act as brand endorsers. The difference between social media
influencers and corporate influencers is their relationship with the company: social
media influencers are external brand endorsers with a large follower network,
whereas corporate influencers are internal endorsers who are members or employees
of the company with a smaller number of followers.
The e-commerce firm OTTO represents a good example for corporate influencer
marketing as it was one of the first companies that integrated corporate influencers in
their communication portfolio and HR marketing. OTTO employees were recruited
on a voluntary basis to promote the company in its role as an employer and to
support the HR department in their efforts of recruiting prospective employees
through different channels (Marten & Kirchmeer, 2018). Figure 12.4 presents the
12
The Relevance of Social Media and Corporate Influencers as Potential. . .
223
Fig. 12.3 Instagram post by influencer @nanda_schwarz for Adidas clean classics. (Photo credit:
Marlen Stahlhuth; Weskott, 2020)
OTTO inside Instagram account (@otto_inside) where corporate influencers
describe their jobs and offer insights into their work.
Corporate influencers, that is, employees of a company, have a high influencer
potential due to their extensive knowledge and enthusiasm about the products
(Influencer Marketing Hub, 2020a). Key aspects of corporate influencers are that
they possess reliable and relevant information, are familiar with corporate trends,
events, and challenges, and share the vision of the company, that they actively
communicate to their target group (e.g., colleagues, stakeholders), and, in turn,
convince them about the change process (Bergk & Slomian, 2018; Enke & Borchers,
2019). Corporate influencers can function as the primary contact for other employees
and, as change agents, ensure constant communication between different corporate
members in change processes (Bergk & Slomian, 2018). Moreover, corporate
influencers can be more effective in influencing external stakeholders as the
influencer–company relationship seems more authentic.
Although corporate influencers are considered as an influencer marketing trend
that deserves more attention (Influencer Marketing Hub, 2020a) and one that has
been recognized particularly in German textbooks (e.g., Bergk & Slomian, 2018;
Enke & Borchers, 2019; Ninova-Solovykh & Einwiller, 2020; Sturmer, 2020), to
date there is only little academic research on corporate influencers (e.g., Hesse et al.,
2020). In particular, research on their role and effectiveness in change processes is
scarce.
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Fig. 12.4 Instagram profile of OTTO inside (@otto_inside). (OTTO inside, n.d.)
12.4
Directions for Future Research
Social media influencers are becoming more common in brand communication and
have gained growing research interest over the past years (Voorveld, 2019). As
outlined in this chapter, social media influencers are individuals who share content
through their social media accounts with their followers. Social media influencers
are of interest for brands because they provide an effective way for brand communication. Research results have determined that (micro-)influencers that are perceived as trustworthy, attractive, similar and authentic, and with high PSI between
the social media influencer and the consumer seem effective for enhancing consumers’ attitudes and behavioral intentions. However, the findings do not singularly
point into one direction, but suggest varying results. It might be interesting to dive
deeper into analyzing these differences by comparing social media influencers’
source credibility across different platforms, fields of interest, between different
influencer types (e.g., micro- vs. macro-influencers) or between internal and external
influencers. Additionally, there is still room for more research to determine which
variables, besides trustworthiness, are the most important social media influencer
12
The Relevance of Social Media and Corporate Influencers as Potential. . .
225
variables overall. Sociodemographic variables, such as age or gender (Voorveld,
2019), or other variables, for instance, the social media influencer’s likability,
personality, or reputation (Kay et al., 2020; Schouten et al., 2020), might play a
role as well.
Moreover, disclosure of sponsored content does not seem to have negative effects
on consumers’ evaluations of the social media influencer or on behavioral intentions.
Still, it might be interesting to examine and compare disclosures in different fields of
interest and for different social media influencer types. As there is limited research
examining the effects of different social media influencer segments and of sponsorship disclosure (Boerman, 2020; Kay et al., 2020), this research topic certainly
warrants additional research.
Lastly, this chapter tried to outline how social media influencers can be considered as change agents (Miller, 2019). However, empirical research on this topic is
scarce. Solely the role of corporate influencers has seen some research interest,
particularly in German academia (e.g., Borchers & Enke, 2020; Hesse et al.,
2020). Therefore, corporate influencers and particularly their role and effectiveness
in change processes provide an interesting and promising research topic. Future
empirical studies should examine the role and effectiveness of corporate influencers
and influencer change agents in internal and external corporate communications. The
discussed aspects of social media influencer effectiveness, such as source credibility,
sponsored content, social media channel, and influencer type, might be worth
considering as well.
12.5
Exercise and Reflexive Questions
1. Social media influencers have recently developed into popular brand endorsers
for marketing purposes. What is your opinion on the question if social media
influencers are here to stay or if they are only a temporary marketing trend?
2. What are the key characteristics of successful social media influencers and what
are the influencer marketing benefits for companies that aim at integrating
influencer marketing in their marketing strategy by collaborating with social
media influencers?
3. Do you think that social media influencers will become more important as change
agents in the future? In which fields or areas of interest could you imagine
influencers as change agents to be suitable and successful?
4. Look for a company that is employing corporate influencers and analyze how
these corporate influencers are integrated in external corporate communications,
for instance, on their website and social media accounts.
5. Look for advertising disclosures in sponsored Instagram posts and stories of three
social media influencers of your choice. How is advertising disclosed? Are the
legal rules of their country of origin properly followed?
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J. Durau
6. To date, there is no standardized way of how to disclose sponsorship in social
media influencers’ branded posts. Elaborate on how a standardized way of
disclosing sponsored content could be established in a country of your choice.
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Julia Durau is a PhD student and lecturer at the Department for
Media and Communications at the University of Klagenfurt, Austria. Her research and teaching interests include influencer marketing, social media, health communication, and organizational
communication.
Chapter 13
Convergence, Consumer Behavior,
and Change Management
Ralf Terlutter and Katharina Ninaus
Abstract Convergence, change management, and consumer behavior are closely
related and affect each other. Especially, the TIME sectors comprising telecommunication, information, media, and entertainment are influenced by convergence and
changes in consumer behavior. In this chapter, we briefly introduce the concepts of
convergence and consumer behavior, then provide a detailed discussion about
changes in consumer behavior and current trends. We show how consumers’ desires
have changed and how this makes change management an essential organizational
capability as marketers and organizations need to be able to adapt to different
customer needs.
13.1
Introduction: Convergence
The concept of convergence has had a great impact on the digital economy and the
industrial and economic structures. Convergence comprises technological facets as
well as aspects including the offer, product, supplier, user, and usage side (Kolo,
2019). It is a process that takes place on different levels and can be dealt with from
different perspectives.
Economic convergence refers to the convergence of industries. Particularly the
sectors of telecommunication, information, media, and entertainment have increasingly grown together with the effect that companies that formerly operated in
separate industries often find themselves in the same industry nowadays (Terlutter
& Moick, 2013). Changes in the supply chain, new competitive situations, and even
new business models emerge. For example, hardware manufacturers are increasingly
investing in the production of own content (e.g., games and music) (Kolo, 2019).
Convergence of technology is based on digitalization. Products become more
complex, and the fusion of multimedia systems allows products to be
multifunctional (Terlutter & Moick, 2013). For instance, unified communications
R. Terlutter (*) · K. Ninaus
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: ralf.terlutter@aau.at; katharina.ninaus@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_13
231
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R. Terlutter and K. Ninaus
platforms refer to the integration of different communication channels and can serve
the communication needs of an entire organization with just a single software
solution. Such holistic communication platforms provide features including instant
messaging, IP telephony, video/audio conferencing, desktop sharing, and more.
Convergence of content describes the digitalization of media content and media
products (Terlutter & Moick, 2013). Media contents and formats are made available
via different distribution channels. This cross-platform distribution of content has
particularly emerged as a result of consumers’ increasing fragmentation of media
usage. Consumers wish to access media contents whenever and wherever (Kolo,
2019; see Diehl et al., Chap. 11).
Convergence of the usage and functionality of end devices is closely related to
consumer behavior and usage patterns. Converged devices attract consumers
through multifunctionality (Kolo, 2019). The smartphone, for instance, combines
many different functions ranging from making a call, watching a video through
taking pictures, and playing games to searching for information on the Internet.
Media consumption patterns have changed tremendously due to converging
processes. Particularly multifunctional converged devices allow for media consumption to happen anywhere and at any time. As a result, marketers are challenged with
new and changing consumer needs and desires, influencing the development of new
products and services.
13.2
Basics of Consumer Behavior
Consumer behavior describes “the study of the processes involved when individuals
or groups select, purchase, use, or dispose of products, services, ideas, or experiences to satisfy needs and desires” (Solomon, 2018, p. 28). Consumer behavior is
influenced by various factors including consumers’ environment, attitudes, or social
status. An individual’s behavior is determined by internal psychological processes
including activating and cognitive processes (Kroeber-Riel & Gröppel-Klein, 2019).
Activating processes include internal arousal and excitement, and drive consumers’ behavior. Activating processes comprise emotions, motivations, and attitudes (Kroeber-Riel & Gröppel-Klein, 2019). For example, using a smartwatch to
monitor body and health may make one feel good (emotion); consequently, one may
be motivated to use the watch more intensively (motivation), which may finally
result in the purchase of the newest version of a particular smartwatch because one
thinks that this watch is best to assist one to achieve personal goals (attitude).
Today’s consumer market is determined by high competition, information
overload, interchangeable products, saturation, and often only little involved consumers (Terlutter & Moick, 2013). Hence, a suitable activation of the consumer is
essential; marketers need to catch consumers’ attention to influence their choices,
intentions, and actual behavior. Due to the current consumer market environment,
advertisers often count on emotions to activate and engage the audience.
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233
Cognitive processes are mental processes that help to mentally control behavior.
Cognitive processes include the reception of information (receiving information),
the processing of information (perceiving and evaluating information), and the
storage of information (learning from and recalling information) (Kroeber-Riel &
Gröppel-Klein, 2019). For example, an individual may consciously search for
information on a new smartwatch on the Internet or may overhear a conversation
about a new smartwatch between others. If the information is relevant to the
consumer due to personal interest and/or a current need, the information is likely
to be stored and may then be retrieved when making a purchase decision.
Consumer behavior is usually the result of both activating and cognitive
processes.
13.3
The Merging of Consumers’ Environments
Consumers’ environment can be split into two realities: the environment of experience and the environment of media (Kroeber-Riel & Gröppel-Klein, 2019). While
the environment of experience is composed of individuals’ direct contacts and
experiences with their surrounding environment, the second reality is conveyed by
the media with media experiences becoming increasingly prevalent. Individuals’
reality is thus not only shaped by own experiences, but also by the media environment (Kroeber-Riel & Gröppel-Klein, 2019).
In today’s age of digitalization, we are in the middle of a global development
toward universal connectedness (Hoffman & Novak, 2018). The boundaries
between the environment of experience and the environment of media are no longer
clear. Connected consumers switch back and forth seamlessly between the physical
and the virtual world, and can access information in an instant, becoming better
informed than ever before. Due to the countless possibilities that arise from the
virtual environment, consumers have become more demanding and transfer their
higher expectations to the real world, forcing offline businesses to engage in online
activities as well (Tkaczyk, 2016). As regards media usage patterns, for instance, it
has become common practice that users consume news both offline and online—also
on various digital devices (Newman et al., 2018).
Examples for the merging of environments are the emerging technologies of
augmented reality (AR) and virtual reality (VR). These technologies could bring
about a radical change in consumer behavior over the next few years. The prospects
are good, especially since technical barriers to entry continue to decrease (Klöß,
2019). Both AR and VR aim to enhance or replace the real-world environment by
virtual elements. While AR takes the physical world and adds virtual content on top,
VR creates a completely artificial environment. Particularly AR technology has a
great disruptive potential and could become a permanent assistant in everyday life.
For instance, apps on wearables such as headsets or smartwatches that are equipped
with AR technology could constantly and seamlessly support the user’s efforts to
communicate or to navigate by showing the necessary information in the user’s
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direct field of view (e.g., showing text messages, photos, or videos). AR would make
it possible for consumers to be permanently guided by digital assistants (Kahlenborn
et al., 2018). Virtual reality, on the other hand, has the potential to change the
entertainment industry. With this technology, users can slip into another world, in
which they can become fully immersed in a much more intense manner compared to
conventional movies or video games (see, e.g., Roettl & Terlutter, 2018). VR
technology offers experiences that would not be possible in the physical reality.
The degree of immersion will continue to grow across different sensory modalities,
including visual, auditory, haptic, and olfactory, so that virtual realities will feel
increasingly real (Kahlenborn et al., 2018).
Particularly the younger generation is used to living in a thoroughly technical and
technological society. In fact, many consumers nowadays demand and appreciate
ubiquitous connectivity. However, this development also leads to challenges: consumers are confronted with a vast amount of information every single day, and their
attention span is decreasing rapidly. Marketers will need to better understand
consumers’ needs and desires to create enhanced customized content and personalized advertising, and to deliver greater value and relevance (Aunkofer, 2018).
Big data analytics, for instance, enables firms to personalize customer information; consumers’ credit card transactions, movies and series watched on TV, music
listened to on the way to work, newspaper articles read online (and the intensity
thereof), events visited, shops frequently used, personal patterns of activity, etc. All
these data are combined and analyzed in order to create sophisticated personality
profiles. Advertising messages are then matched to the individual profiles to better
target consumers’ individual needs and to elicit a more emotional response
(Kahlenborn et al., 2018). Consumers’ relationships with marketers, manufacturers,
and retailers will therefore permanently change and will become more interactive.
Companies have to be able to respond to these changes quickly in order to benefit
from the new opportunities that will emerge. The process of digital transformation is
changing consumers’ lives and economic interrelations with unprecedented speed,
reach, and intensity (Kahlenborn et al., 2018; Aunkofer, 2018).
13.4
Consumer Acceptance and Use of Technology
Any technological innovation targeting the consumer market depends largely on
consumers’ acceptance and intention to use. While two decades ago consumers were
hardly able to imagine browsing the Internet from a TV, today, converged devices
and contents have become normal in consumers’ daily lives. Users’ behavior has
changed particularly due to the wider diffusion of information technologies and the
ubiquitous connectivity offered by the Internet.
The Technology Acceptance Model (TAM) is a prominent framework to investigate users’ behavior toward a new technology and their acceptance or rejection
thereof (Lee et al., 2003). The premise of the model is that perceived ease of use and
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perceived usefulness determine individuals’ attitude toward using and actual system
use (Venkatesh et al., 2003).
While the original TAM primarily focuses on utilitarian components, today’s
consumers decide to use and adopt products and services not only based on utilitarian attributes, but also based on hedonism and social factors (Solomon, 2018).
Accordingly, the current TAM research also incorporates other antecedent factors
into an extended version of the model to explore specific issues. For instance,
research has examined both utilitarian and hedonic motivations in consumers’
intentions in relation to purchasing online (Driediger & Bhatiasevi, 2019) or using
mobile payments (Bailey et al., 2019). TAM is still widely used in consumer
behavior literature, often in combination with other models, theories, and influencing
components, including research on consumers’ intention to engage in fashion mobile
commerce (Chi, 2018), consumers’ collaborative consumption intentions (Min et al.,
2019), young consumers’ engagement with brands on social media sites (Florenthal,
2019), consumers’ showrooming behavior (Arora & Sahney, 2018), or consumers’
intention to purchase electric vehicles (Tu & Yang, 2019). Incorporating contemporary components can help contribute to a holistic understanding of consumers’
intention for convergent technology usage (see Langner & Klinke, Chap. 9 and
Diehl & Terlutter, Chap. 10).
Venkatesh et al. (2003) synthesized prior technology adoption research and
developed the unified theory of acceptance and use of technology (UTAUT)
(Venkatesh et al., 2003). UTAUT has four key components—that is, performance
expectancy, effort expectancy, social influence, and facilitating conditions—that
influence behavioral intention to use a technology. The model was developed to
predict technology use primarily in organizational contexts (Venkatesh et al., 2012).
As a further development, the constructs from UTAUT were adapted to the consumer use context (i.e., UTAUT II) (Venkatesh et al., 2012).
In UTAUT II, performance expectancy is the degree to which using a technology
will bring benefits to consumers in doing certain activities; effort expectancy is
defined as the degree of ease related to consumers’ technology use; social influence
refers to the extent to which consumers perceive that important others (e.g., family
and friends) believe they should use a specific technology; and facilitating conditions describe consumers’ perceptions of the resources and support available to
perform a behavior. In addition, three more constructs were added to UTAUT II to
tailor it to the consumer technology use context: hedonic motivation, price value,
and habit (Venkatesh et al., 2012). Hedonic motivation describes the pleasure or fun
stemming from using a technology; price value refers to the cost and pricing
structure that may have a significant impact on consumers’ intention to use a
technology; and habit is the extent to which consumers tend to perform behaviors
automatically (Fig. 13.1).
UTAUT and UTAUT II have become established models in research on consumer technology adoption, including, for instance, consumers’ intention to use an
augmented reality-based mobile application for tourism experiences (Rodrigues
et al., 2019) or to play crowdsourcing games (Wang et al., 2020).
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Fig. 13.1 UTAUT II. (Venkatesh et al., 2012)
13.5 Trends in Consumer Behavior
Consumer research and marketing are facing great challenges when it comes to
meeting consumer needs. Considering that the consumer market shows a great
degree of saturation with often interchangeable products (see, for instance, the
large number of smartphones available on the market), it has become increasingly
difficult to differentiate oneself from competitors. Moreover, increasing market
differentiation makes target group-specific operations essential. Consumers’ lifestyles, for instance, determine to a great extent how time and money are spent.
Hence, consumers’ selection of products and services creates opportunities for
market segmentation strategies to understand consumers better and to develop
target-oriented approaches (Solomon, 2018; Solomon et al., 2016). The dynamics
of digitalization and convergence seem to change people’s preferences more quickly
than ever before, increasing the importance of the organizational ability to adapt to
changing needs as well (Solomon, 2018; Solomon et al., 2016).
As a result of today’s hyperconnected world, consumers around the globe
demand and look for convenience in all forms—whether ease, time saving, or
suitability (Nielsen, 2018). Moreover, consumers expect user-friendliness and the
integration into a comprehensive service ecosystem and a smart service interface
with remote access (Aunkofer, 2018). For example, mobile commerce enables a
purchase regardless of place and time, and thus, meets consumers’ needs for
convenience and autonomy. Similarly, voice-controlled assistants such as Amazon’s
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Alexa or Google’s Siri make all kinds of shopping even more enjoyable and
convenient for consumers (Kroeber-Riel & Gröppel-Klein, 2019).
In response to consumers’ desire to use content across platforms, providers need
to adapt quickly to these changing demands and to deliver more personalized offers
(Kolo, 2019). For instance, the proliferation of connected gadgets provides more
convenient, on-demand, and interactive ways to consume content. In fact, mobile
connectivity no longer only satisfies consumers’ needs for accessible communication and information, but mobile phones have become an accessory for just about
everything in consumers’ lives. Consumers enjoy the freedom of being connected
anywhere anytime (Nielsen, 2018).
One important aspect is the concept of prosumption that involves both production
and consumption of Web content rather than focusing on either one or the other.
Today’s digital network technologies no longer have barriers that initially separated
production from consumption, but enable audience participation and the creation and
exchange of user-generated content (Zajc, 2015; Ritzer & Jurgenson, 2010). Already
today user-generated content comprises a variety of media including Wikis, blogging, podcasting, forums, review sites, or social networking, and is highly demanded
by the consumers. For instance, as of May 2019, more than 500 hours of video were
uploaded to YouTube every minute (Clement, 2019a). With the pervasion of social
media, consumers can create content and amplify their voices across the globe, and
are thus becoming more powerful. Social media platforms have enhanced, accelerated, and intensified C2C communication, paving the way for a new dimension of
word of mouth. Nowadays, consumers evaluate their purchasing decisions more
intensely and in a more sophisticated manner than ever before and share their
experiences with the online community (Aunkofer, 2018; Kahlenborn et al., 2018).
Other important trends in consumer behavior include consumers’ increasing
preferences for a more sustainable and healthier lifestyle (e.g., Schaefer & Crane,
2005). In their buying decisions, consumers also pay more attention to companies’
overall contribution to society, that is, to their corporate social responsibility (CSR)
(e.g., Becker-Olsen et al., 2011; Diehl et al., 2016; Ettinger et al., 2021).
Consumption habits themselves are changed by the usage of digital devices and
applications, too. Search engines, price comparison sites, online trading platforms,
digital wish lists, and a growing number of consumption-related apps are changing
consumer behavior. Consumers’ preference for online shopping is rising steadily. In
2012, more than half of the German population (52%) preferred buying in traditional
stationary shops; today only 23% are still in favor of purchasing offline. Meanwhile,
almost two thirds of the German population (65.7%) buy online, while in the age
groups 14–29 years and 30–59 years even 80% resp. 79% do so. Online retail had a
14.9% share of total retail sales in 2018; in the market of consumer electronics and
electronic devices, the share of e-commerce amounted to as much as 31% (Trade
Association Germany, 2019).
Apart from consumption habits, consumers’ marketplace experiences are also
changing. One emerging topic is the interaction between consumers and humanoid
robots, that is, robots with a human-like morphology such as a face, arms, and legs.
Particularly humanoid service robots are rising in various industries (Harris et al.,
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2018), although research indicates that consumer robots should not look too humanlike. For instance, Mende et al. (2019) reported that humanoid service robots elicited
greater consumer discomfort compared with human employees, but these negative
consequences were mitigated when the robot was mechanized rather than humanized. Similarly, Kim et al. (2019) found that anthropomorphism of a consumer robot
decreases consumers’ attitudes toward robots due to uncanniness. Experts predict
that humanoid service robots will be employed in customer-facing situations (Kim
et al., 2019), potentially replacing millions of service workers in the next decade
(Harris et al., 2018); however, robotic research will be asked to determine the ideal
degree of anthropomorphism.
Advancements in robotic research and artificial intelligence have also given rise
to new issues in society, above all ethical issues, as it is about reproducing mental
qualities in machines (Nath & Sahu, 2020). Machine ethics is concerned with
creating ethical machines, so-called artificial moral agents that follow ethical principles and that are capable of moral reasoning and ethical decision making (Cave
et al., 2019; Nath & Sahu, 2020). Ethical issues regarding intelligent machines are
more relevant than ever before, and the field of machine ethics will need to evaluate
potentials and risks of ethically aligned machines, tackling urgent issues such as
preventing ethical machines from being used with manipulative or fraudulent intentions, ensuring that machines can deal with value pluralism, and considering whether
or not we should grant moral rights to machines (Cave et al., 2019). Certainly,
intelligent machines are the emerging reality in consumers’ lives, and research on the
ethical perspective on these interactions will remain important.
13.6
Digital Transformation and Changing Consumption
Patterns
The current digital transformation, a technology-driven continuous change process
encompassing our entire society, is marked by a convergence of classic IT with
embedded systems (Ebert & Duarte, 2018). This digital disruption is changing
people’s interaction with technology, both in an organizational and individual
context. In fact, advancements in technology have changed the way in which
consumers discover, evaluate, select, buy, and use products and services. Hence,
digitalization has substantial effects on the economy and the way of life (Aunkofer,
2018; Kahlenborn et al., 2018).
13.6.1
Mobile End Devices: The Key Drivers of Change
Converged wireless portable devices enable users to access and share information
quickly and easily on the go. They offer a broad range of functionalities that allow
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consumers to perform various tasks and fulfill different purposes. Particularly the
mobile Internet usage has become an essential habit of smartphone and tablet users
in everyday life. In 2019, already more than half of the total global online traffic
(51.96%) was attributed to mobile Internet traffic (Clement, 2019b). The mobile
industry connects 47% of the global population to the Internet, equivalent to over 3.5
billion people (Bahia & Suardi, 2019). This growing importance of mobile usage is
particularly driven by a shift from PC and laptop toward the smartphone
(Kahlenborn et al., 2018). 2018 is the first year in which users in Germany used
the smartphone more often to access the Internet rather than a PC/laptop (Rabe,
2019). In Austria, 97% access the Internet via their smartphones, in the age group
14–29 years 100% do so (Mobile Communications Report, 2019). This little device
in our pockets has become a constant companion and electronic assistant in everyday
life. Only 13 years after launching the first iPhone the number of smartphone users
worldwide is projected to reach 3.5 billion in 2020 (Holst, 2019). The launch of the
fifth-generation technology, or 5G, will further intensify the trend toward the mobile
Internet.
Today, the smartphone stands for the daily transformation of consumers’ lives. It
enables users to search for information and to navigate; to get to know new places,
people, and products; to track their success in sports (see, e.g., Hosseinpour &
Terlutter, 2019); to produce, to edit, and to share photos and films; to book trains,
tickets to the cinema, or a flight and to pay for the bookings directly online; to have
immediate access to important papers and documents; to listen to music; to watch a
movie or play games; to fight boredom; to communicate combining text, pictures,
videos, and sound; to buy anything the heart desires—and of course to make a call.
At the moment, there is no other electronic device that is—both physically and
emotionally—closer to the consumer than the smartphone; it is consumers’ life to go
(Wider, 2016).
The smartphone has become the preferred digital device of today’s consumers.
Current forecasts even predict that almost three quarters (72.6%) of the world’s
population will be mobile-only by 2025 (Bahia & Suardi, 2019). Consequently, it is
no surprise that mobile commerce (m-commerce) is also on the rise. M-commerce
refers to the buying and selling of goods through wireless handheld devices and has
become a growing trend worldwide. Global mobile retail commerce revenue is
expected to reach 3.56 billion US dollars in 2021. In Germany, already one third
(34%) of today’s e-commerce purchases are made on a smartphone (Trade Association Germany, 2019). This wireless portable device has become an inherent part of
consumers’ shopping behavior; they use it before, during, and after a purchase. Even
when in stationary shops, consumers use their smartphone to look for information on
products, to research and compare prices, to inform themselves of special offers, or
to read product and service reviews (Mobile Communications Report, 2019). It is
estimated that only one third of all nonfood sales in stationary retail is not influenced
by the Internet (Trade Association Germany, 2019). Stationary retailers need to
adapt to these new consumer patterns, making product and price information
available online and using digital technologies in order to develop an emotional
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and a more personalized customer relationship. Today’s consumers expect the right
information at the right time in the right place (Wider, 2016).
The trend toward wireless devices, above all the smartphone, is also reflected in
mobile wallet payments. Mobile payment refers to regulated transactions that take
place through a mobile device and it enables consumers to pay digitally. This
technology has become a trend, particularly among the younger generation; in
Austria, for instance, in the age group 14–29 years 47% are already making use of
it (PwC, 2019). The mobile trend is also spreading to the gaming industry (see also
Lux, Chap. 25). In Germany, 34.3 million people (42%) play computer and video
games overall, 18.6 million do so on their smartphone. The share of users playing
games on their smartphone is increasing steadily and the smartphone has actually
become the most popular games platform followed by the console (16.7 million) and
PC (13.4 million; German Games Industry Association, 2019).
Foldable phones are another emerging trend in the smartphone field and could be
the next big thing. Their greatest asset is the fact that they combine the attributes of a
large-screen device with the portability of a smartphone. This is expected to attract
consumers and to meet their desires for convenience and innovative devices. Yet,
foldable phones have had a difficult start with technical teething problems and
delayed launches. As a consequence, consumers are still ambivalent about this
innovation (Klöß, 2019).
From the user point of view, the smartphone combines many different functionalities, offering consumers numerous possibilities. As a consequence, consumers are
becoming more demanding and are increasingly turning to on-demand consumption
of content.
13.6.2
The Disruption of Traditional Television
Digitalization has changed the world of television. There has been a rapid increase in
online video streaming as the Internet has become faster and more reliable. Video
viewing is driven by video-sharing sites, video-on-demand services, and the integration of video into social media sites. In Germany, 79% of Internet users aged
16 years and older stream moving image content. Almost two thirds (65%) stream
videos in video portals such as YouTube or Vimeo, or watch TV broadcasts timedisplaced in media libraries, and 42% watch movies and series via subscriptionbased video-on-demand services; in the age group 14–29 years, as many as 53% use
the latter (Klöß, 2019).
With mobile and wireless networks, users can stream anywhere and anytime,
preferably via the laptop (89%), the tablet (86%), or the smartphone (83%), but the
television is also becoming increasingly popular for video streaming (74%). The
reason for this rising popularity is the growing prevalence of smart TVs, that is, TV
sets that are connected to the Internet (Klöß, 2019). The share of TV households with
an Internet-enabled TV in Germany has tripled within the past 5 years; in 2019,
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56.4% of households used Internet-enabled TV sets (Koptyug, 2019a), and roughly
39% had actually connected their smart TV (Koptyug, 2019b).
Subscription video-on-demand is becoming increasingly popular. Its success can
also be seen in the fact that the market is becoming more and more congested with
Netflix, Amazon Prime Video, Hulu, Disney+, Apple TV+, HBO Max, to name the
most prominent competitors on the subscription-based streaming market. Consumers prefer the possibility offered by these services to watch the content they
want to watch whenever they want to watch it. Experts predict that on-demand
services will disrupt the TV industry (Deloitte, 2018). The development away from
linear TV toward nonlinear streaming will continue over the next few years. It is
expected that the consumption of moving image contents will increase from
241 minutes to 262 minutes per day, but this will be due to the growing use of
video-on-demand services and not due to traditional television (“Video on Demand”,
2019). Nonetheless, experts argue that traditional TV and nonlinear content offerings
will coexist. Video-on-demand will become standard in all population groups, but on
the other hand, linear TV will remain important, particularly live content including
sports and major events will preserve its significance (Deloitte, 2018). This particularly applies to the German-speaking market with its free-to-air channels, and
where the production and broadcasting of national TV content serve as a valuable
USP. Indeed, linear TV consumption is expected to suffer only marginal losses in the
years leading up to 2030 (“Video on Demand”, 2019).
13.6.3
The Internet of Things and Its Potential to Change
Consumers’ Lives
The Internet of Things (IoT) refers to extending Internet connectivity beyond
standard devices, such as laptops, smartphones, and tablets, to initially non-Internetenabled physical devices and everyday objects. Hence, devices that traditionally
were not related to each other, such as door locks, surveillance cameras, or lights, are
equipped with technology and can now communicate and interact over the Internet,
and they can be remotely monitored and controlled. The IoT ecosystem is large and
growing rapidly, consisting of connected cars, wearables, voice-controlled assistants, smart speakers, and more (Novak & Hoffman, 2019; Klöß, 2019). Entire
consumer categories including health care, fitness, automobiles, and the home
environment are now forming the consumer Internet of Things. Even trivial household appliances, such as a toaster or a refrigerator, can now become active partners in
interactions (Hoffman & Novak, 2018). In a smart home, for instance, whenever the
user arrives home, the car communicates with the garage to open the door. Once
inside, the thermostat is already adjusted to the preferred temperature, and the light is
set to the chosen color for maximum relaxation, as the smartwatch indicates it has
been a busy day (IoT Agenda, 2018).
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IoT has the potential to simplify the process of consumption, thus, changing the
shopping experience as a whole. Consumers would no longer need to undergo the
entire customer journey themselves, but instead, smart devices could carry out the
necessary steps for them. For instance, smart printers can automatically order
replacement toner before the old cartridge has been used up. Similarly, smart
refrigerators can order milk and other products that are bought habitually. Smart
devices have sensors that enable them to track consumption habits and patterns, and
to order physical goods when supplies are running low (Kahlenborn et al., 2018).
Nowadays, most households are already well connected. In Austria, around 90%
of households have Internet access, around 86% own a computer (Statistik Austria,
2019), and around 77% have a smartphone (Schultz, 2019). Hence, the infrastructure
that is needed for enabling data exchange between smart gadgets, manufacturers, and
service providers is available, and yet, the demand for products that are embedded in
a smart ecosystem is still relatively low. After a fast initial growth, the share of smart
products has been growing at a much slower pace or even stagnating since 2014. The
utility of smart products is often still not tangible for many consumers (Aunkofer,
2018). Apart from the innovative character of Internet-enabled products, consumers
do not yet see a clear benefit, but rather worry about further technological complications in their lives (Hoffman & Novak, 2018). In fact, a study on individuals’
perceptions of technologies has provided evidence that digitalization has made
things easier, faster, and thereby more efficient, yet, at the same time, evolving
technologies have come with a cost, too, increasing stress and affecting users’ health
adversely (Ninaus et al., 2015).
Consumer acceptance and adoption of connected products is the real challenge
for IoT (Aunkofer, 2018). Marketers will have to find ways to communicate the
actual value that smart gadgets provide to consumers. Instead of talking about the
products themselves, marketers should focus on the experiences that are likely to
emerge from consumers’ interactions with their devices as these interactions will
offer more than any mere single product could do. Simple interactions between
consumers and products will turn into much more complex relationships. IoT could
revolutionize everyday consumer experiences (Hoffman & Novak, 2018).
This new interconnection of traditionally nonrelated devices raises concerns in
relation to security and privacy (see Mueller et al., Chap. 15 and Hattenberger &
Vidreis, Chap. 14). IoT technology has developed more quickly than the mechanisms available to protect the devices and their users. In fact, security is still being
seriously neglected by many IoT manufacturers. Experts warn consumers to research
carefully when adding smart devices to the home network. Researchers have already
demonstrated remote hacks on cars, and more and more cyberattacks will be
targeting IoT devices. Besides ease of use and convenience, consumers must keep
in mind that anything that is connected to the Internet can be hacked (Toomey, 2018;
IoT Agenda, 2018).
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13.6.4
243
Changing Usage Patterns and Some Effects
on the Industry and the Environment
Today’s process of digital transformation constitutes a megatrend across industries.
However, it is challenging because it demands a new set of competences, combining
embedded-systems development with IT and cybersecurity. With its convergence of
classic IT with embedded-systems engineering, digital transformation will reshape
the landscape of software technologies and processes. This development is particularly driven by industry, home, health care, and automotive applications (Ebert &
Duarte, 2018).
Connectivity is an important buzzword in this process of digital transformation,
posing a major opportunity for the customer technology industry. Digital content is
booming across all age groups and constantly increasing; indeed, connectivity has
become an essential feature for just about any device category. Device manufacturers need to adjust quickly as the intelligent connection between hardware and
content has become a real differentiation criterion. Consumers nowadays expect end
devices that include smart user interfaces and convenient access to content offerings
(Böhm & Esser, 2019).
The customer technology industry is currently seeing a trend toward one-stopcontent-shops. With Amazon, Apple, and Google, the big digital platform companies are increasingly converging content from different media genres and are heavily
investing in the production of own content (Böhm & Esser, 2019). For example,
Amazon provides its Prime members access to streaming of movies, TV shows and
music, unlimited reading, exclusive shopping deals, and free shipping. Also, Apple
is investing in paid content and has announced various subscription-based streaming
services including music, video, magazines and newspapers, as well as games.
Similarly, via Google Play Google provides its users access to music, e-books,
audio books, movies, series, and digital magazines. The big players are responding
to new consumer demands by offering diverse content packages to increase their
customers’ loyalty.
As with all new innovations, there are also drawbacks. Almost all trends related to
digitalization come with an increasing energy demand and a rising use of resources,
thus, representing a burden on the environment (Kahlenborn et al., 2018). This
ecological footprint arises both from materials needed for the hardware (e.g., PC,
smartphones, server parks), and from electricity consumption when using digital
media (Frick & Santarius, 2019). However, at the same time, digitalization can also
contribute to more sustainable consumption. For instance, blogs and information
platforms provide information on manufacturing processes and their environmental
impacts, virtual realities could (partly) replace conventional products or services, and
green apps could facilitate and foster sustainable consumption patterns. Digitalization also makes it easier for consumers to purchase used goods or to share goods with
other people. Hence, digitalization could help to increase the awareness about
problems that arise out of nonsustainable patterns of production and consumption,
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thus, supporting consumers’ ability to consume sustainably (Frick & Santarius,
2019; Kahlenborn et al., 2018).
Research is urged to gain and provide more insights into and a better understanding of consumers’ usage patterns of digital contents and technological devices. This
will help to adapt to new needs in order to offer products, services, and information
that satisfy true consumer demands. Above all, consumers are striving for convenient solutions that bring more fulfillment, joy, and balance into their busy lives as a
result of today’s hyperconnected world.
13.7
Exercises and Reflexive Questions
1. Briefly explain the different perspectives from which the concept of convergence
can be dealt with.
2. Briefly describe internal human processes that drive consumer behavior based on
an own example.
3. Which human environments can be differentiated? Discuss how the processes of
convergence and digitalization have influenced these environments.
4. Name and briefly explain the four key components of the unified theory of
acceptance and use of technology from a consumer use perspective. Elaborate
how the additional constructs in the model may affect usage behavior.
5. Describe how current trends aim to satisfy consumers’ increasing demand for
convenience.
6. Discuss the growing importance of mobile usage. How can manufacturers and
service providers respond to the changing consumption patterns?
7. Describe the current developments regarding linear television. What are the
biggest changes and challenges?
8. What opportunities and risks could the Internet of Things bring? In what way
might IoT change everyday consumer experiences?
9. What are the major challenges for the industry in today’s age of digital
transformation?
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Ralf Terlutter is Full Professor of Marketing and International
Management and Head of the Department of Business Management at the Faculty of Management and Economics of the
University of Klagenfurt, Austria. He received his PhD from
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Communication.
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Katharina Ninaus is a Research and Teaching Assistant at the
Department for Marketing and International Management at the
Faculty of Management and Economics of the University of
Klagenfurt, Austria. Her research interests include new media
and communication, consumer technology usage, as well as health
marketing and communication.
Chapter 14
Right to Privacy: A (re-)measurement
Doris Hattenberger and Florian Vidreis
Abstract Essays on the right to privacy now include by default the observation that
privacy is more at risk than ever. This is due to technological progress, which has
made the threat decentralized and ubiquitous, and assaults are cheap for everyone. In
addition, many are highly permissive with data from their private lives. Has privacy
protection, therefore, become obsolete? Not at all. Apart from a core area of privacy
that is considered to be unalterably protected, it must be constantly redefined in view
of the dynamics of developments. This article attempts to make the contours of
privacy protected by fundamental rights visible.
14.1
Introduction
“Privacy is doomed . . . get used to it.” With this headline, more than 20 years ago,
The Economist accurately described a development that some call the post-privacy
age (Berka, 2018, p. 756). There is no shortage of scandals to substantiate this
development: in the “Cambridge Analytica” case, the company unlawfully analyzed
up to 87 million Facebook users’ profiles. Cambridge Analytica created profiles
from the data obtained to use them in the US election campaign and the Brexit vote
(see Mueller et al. in this volume). In 2013, Edward Snowden informed the public
that the US intelligence agency NSA monitored global Internet communications
without restraint. Besides, the British government systematically monitored politicians from other nations by spying on their emails and computers during the G20
summit. We have become familiar with data theft reports or unauthorized data
disclosure, especially to other companies.
Florian Vidreis prepared the case law examples, and Doris Hattenberger wrote the remaining text.
D. Hattenberger (*) · F. Vidreis
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: doris.hattenberger@aau.at; Florian.Vidreis@gmx.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_14
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However, the loss of privacy is by no means solely the result of frequent breaches
of the law. It is generally the rapidly changing technical possibilities that dissolve
familiar boundaries between public and private. Anyone who wants to use the
smartphone’s advantages, which is today a “mainframe,” inevitably leaves many
traces on the Internet. With the possibilities of big data and data mining, personality
profiles can be generated to predict people’s behavior better than their closest
relatives and best friends can (see Malthouse and Green in this volume). Crossborder networking and the associated globalization of data flows mean that the
national legislators’ control options can only have a limited effect. The question of
responsibility is becoming increasingly difficult to resolve (see Voci and Karmasin
in this volume). The narrowing space of the private sphere is due not least to the
decentralization of the threat. Whereas protection from an overpowering state used
to be the primary concern, today, the danger also comes primarily from private
individuals. There are many of them, considering that more than 4 billion people use
the Internet today (Berka, 2018, p. 756).
The decentralization of the threat to privacy is a direct consequence of product
convergence (Diehl & Karmasin, 2013, p. 1; Diehl et al., 2013, p. 353f; Terlutter &
Moick, 2013, p. 164f). A smartphone is no longer just a phone but a multifunctional
device. It is suitable for individual as well as mass communication. Whereas in the
past, the operation of a mass medium such as a newspaper or a radio station was
reserved for only a few because of the high investment costs, mass communication
possibilities are now open to everyone. Also, today’s smallest devices, which one
can buy cheaply in shops, offer control possibilities that were previously only
available to state security agencies. Product convergence makes it possible for
many people to invade the privacy of others.
Invasion of privacy is cheap and easy to have today. The computer as a work tool
and companion gives the employer extensive control possibilities. For example, they
can obtain information on when, with whom, and how long communication took
place or which documents were written or printed, and how quickly. In the digital
age, these control options are technical by-products, data that accumulates, but at the
same time they can reach far into the private sphere.
The state’s surveillance instruments significantly expanded in recent years. Austria introduced the “Great Wiretapping Attack” and the “dragnet” as far back as the
end of the twentieth century (Berka, 2012, p. 10, 2020, p. 498). It was followed by
preventive video surveillance, for example, at crime hotspots or—in the wake of the
Madrid and London attacks—the adoption of the Data Retention Directive by the
European Union (see Mueller et al. in this volume). This Directive required telecommunications service providers to store traffic and location data (but not content
data) in the telecommunications sector for a legally standardized period to prevent,
detect, investigate, and prosecute serious crimes and protect state security.
On the one hand, the private sphere’s erosion is caused by the technical possibilities to penetrate it. On the other hand, users of the blessings of technology are
more willing to disclose personal information. Not only fitness data such as weight,
pulse rate, and oxygen saturation are shared but also what one is currently reading,
streaming, or eating (Berka, 2018, p. 756). In addition, the possibilities of the new
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communication and information technologies not only create new threats but are also
accompanied by conveniences and advantages. They offer new opportunities for
social interaction and an increase in comfort. “In this sense, the growth and loss of
freedom go hand in hand” (Berka, 2012, p. 11). Apart from that, not using these
technologies today means being an outsider and being isolated in social and economic terms. It is almost impossible to get out.
This situation raises the question of what we are talking about when we speak of a
right to privacy. It may well be that, as a result of these developments, the protected
area is becoming increasingly smaller and that some people are also voluntarily
giving up this protection to a large extent. However, this does not change the
necessity of protecting privacy. On the contrary, the almost overwhelming threat
potential has only strengthened the insight into safeguarding the private sphere.
Privacy is an essential prerequisite for the development and unfolding of the
personality. It is a space of retreat, an area in which one feels safe. People who
think they are constantly being watched come under pressure to conform and behave
differently than they would without control (Wiederin, 2014, p. 364). And the
Austrian Constitutional Court (VfGH) has very aptly described the need to protect
privacy as follows: “In a society characterized by respect for freedom, the citizen
need not, without good reason, allow anyone to see what pastime he pursues, what
books he buys, what newspapers he subscribes to, what he eats and drinks, and
where he spends the night” (VfGH 14.03.1991, G 148/90, ECLI:AT:VFGH:1991:
G148.1990).
In the following, the private sphere’s legal guarantees, its status in the legal
system, will be presented. However, the starting point is the Austrian legal system,
which is intensively influenced by European law. In this respect, we are also talking
about a European body of law. Examples from case law will measure the scope of
protection of the right to privacy. It will be shown that this is not a fixed value but is
changeable and, above all, disposable. It is up to the individual to determine what
they want to reveal to others and what they want to keep secret.
14.2
14.2.1
Fundamental Right to Privacy
Right to Privacy in the Multilevel System
of the Legal Order
The Austrian legal system robustly and repeatedly protects the right to privacy. One
should note that this right is guaranteed at several levels of the legal system. First, the
Austrian legal order is hierarchical—a system of norms in a relationship of superiority and subordination. Excluding the European Union law, constitutional law is at
the top of this hierarchy. The following are the simple laws, regulations, and
individual decisions such as notices and judgments. These norms are in a relationship of superiority and subordination because the superior law regulates the formal
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and substantive conditions for the generation of subordinate law. An example will
show this. Suppose the Austrian constitutional order provides for a so-called fundamental right to privacy. In that case, the legislator who enacts simple laws is bound
by the value decisions expressed by this fundamental right when enacting the simple
laws. On the other hand, this means that a simple-law provision that does not duly
respect the fundamental right to privacy provided for in the Constitution is unconstitutional and will be overturned in proceedings before the Constitutional Court.
Accordingly, norms with a higher rank determine subordinate law. Provisions for the
protection of privacy can be found at several levels, both at the level of constitutional
law and at the level of simple statutory law.
The European Convention on Human Rights (ECHR) is a treaty under international law that was drawn up within the framework of the Council of Europe, signed
in 1950, and entered into force in 1953. Austria acceded to the Convention in 1956
and adopted it directly into domestic constitutional law. It, therefore, has the status of
national constitutional law. The significance of the Convention for the development
of human rights protection is outstanding. It is a highly developed catalog of human
rights (at the time). Furthermore, it provides a legal protection system that allows
individual persons (and not only states) to sue for violations of the guaranteed human
rights before an international authority, the European Court of Human Rights
(ECtHR). In turn, this Court’s decisions influence the interpretation and application
of the Convention rights by national authorities.
The right to privacy is also guaranteed in other international legal documents that
strongly impact the Austrian legal system. One of these is the Charter of Fundamental Rights of the European Union (CFR), which protects several aspects of
privacy in Article 7 and Article 8. Due to the specific mode of action of Union
law, these guarantees have the quality of rights guaranteed by constitutional law.
Accordingly, they have the same status as nationally assured fundamental rights
(Riesz, 2019, margin 26).
Last but not least, the Council of Europe Convention 108 of 28 January 1981 for
the Protection of Individuals concerning Automatic Processing of Personal Data
should be mentioned in this context. This Convention was the first internationally
binding document that protects individuals against attacks through the use of
personal data. This international Convention is still in force today (Forgó & Rieß,
2018, margin 16).
14.2.2
How Fundamental Rights Work
Fundamental rights are “fundamental legal positions” of human beings, legal positions that society regards as essential and indispensable, intended to protect the
individual’s dignity and freedom (Berka, 2020, p. 403). They enjoy a higher status
than other legal claims: They are warranted in constitutional law and thus also
endowed with a higher substantive power because they can only be amended in
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parliament by a majority of two-thirds of the votes cast. They are, therefore, beyond
the control of a simple majority in parliament.
An essential feature of fundamental rights is that individuals can enforce them.
Following their historical significance, fundamental rights are directed against the
state. They regulate the relationship of the state to its citizens.
The first catalogs of fundamental rights emerged in Austria in the middle of the
nineteenth century. The enlightened middle classes demanded that the state respect a
sphere of freedom. Accordingly, fundamental rights were to protect the individual
from interventions by the state upon this sphere of freedom. They were conceived as
so-called defensive rights. The state was required to refrain from interfering with this
sphere of freedom.
However, the effect of fundamental rights has long since been tied to more than
just the state’s failure to act. In addition to the defensive dimension of fundamental
rights, they also give rise to duties on the state’s part to protect. It means that the state
must take (active) action. The freedom rights also oblige the state to protect from
interference by third parties. For example, Article 8 of the ECHR, which requires
respect for private life, implies that the state must also actively protect individuals
from emissions that are harmful to their health (ECtHR 28.01.2000, 21,825/93 and
23,414/94, McGinley and Egan vs. The United Kingdom, ECLI:CE:ECHR:2000:
0128JUD002182593). Furthermore, it is also derived from Article 8 ECHR that the
state must establish effective legal protection to enable individuals to enforce their
rights (Meyer-Ladewig & Nettesheim, 2017, margin 2f). Finally, Article 8 ECHR
also obliges the state to enact penal laws to effectively prevent severe violations of
the values protected by Article 8 ECHR. The European Court of Human Rights
considered Article 8 to be violated because the punishment of rape requires proof of
physical resistance (ECtHR 04.12.2003, 39,272/98, M.C. vs. Bulgaria, ECLI:CE:
ECHR:2003:1204JUD003927298).
14.2.3
Test Scheme: Intervention and Violation
Human rights documents do not guarantee fundamental rights in absolute terms.
States can restrict the guarantees of liberty to protect higher-value public interests or
to protect others’ freedoms. It is essential to distinguish between intervention and
infringement. In a first step, one has to examine whether the measure intervenes in
the protected sphere of the fundamental right. In a second step, one has to find out
whether the intervention is justified or inadmissible. In the latter case, one speaks of a
violation or infringement of the fundamental right (Berka, 2020, p. 445). Such an
infringement is assumed if an intervention on the fundamental right is not provided
for or if the intervention’s constitutional conditions are not met. For example, the
fundamental right is violated if there is no legal basis for the intervention, or because
no legitimate objective of the intervention is being pursued, or because the encroachment is disproportionate. The requirement of proportionality then includes further
test steps:
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1. The means used must be suitable to achieve the goal.
2. The means used must be necessary, i.e., always use the mildest means to achieve
the objective.
3. An appropriate relationship must be maintained between the severity of the
intervention on fundamental rights and the weight of the legitimate objective
pursued. Therefore, a grave intervention on a fundamental right violates the
fundamental right if the interest pursued is of minor importance.
14.2.4
Legal Protection
Fundamental rights are subjective rights. That means that they can also be enforced
by those affected. As they are guaranteed at various legal system levels, they also
provide legal protection before various national and international authorities.
At the national level, the Austrian Constitutional Court (Verfassungsgerichtshof,
VfGH) is primarily responsible for safeguarding fundamental rights. On the one
hand, it examines general legal acts (e.g., laws) to determine whether they are
compatible with fundamental rights. However, it also investigates possible violations of fundamental rights by individual decisions of the administrative courts. The
Supreme Court (Oberster Gerichtshof, OGH), Austria’s highest court in civil and
criminal matters, is also responsible for ruling on violations of fundamental rights.
If the ECHR’s rights are violated, an international court, namely, the European
Court of Human Rights (ECtHR), can be called upon after the domestic possibilities
have been exhausted.
The European Court of Justice of the European Union (ECJ) decides on violations
of rights under the Charter of Fundamental Rights.
The decisions of the two international courts, also in non-Austrian cases, are of
particular importance for national legal practice, especially since they provide
important indications for the interpretation of fundamental rights even by the state
authorities. In this respect, one can justifiably speak of a European standard of
fundamental rights.
14.2.5
The Fundamental Right to Privacy
Genuinely national constitutional law protects individual aspects of privacy. In
particular, these are the inviolability of the right of domicile (Article 9 Basic Law
on the General Rights of Nationals, StGG), the secrecy of correspondence (Article
10 StGG), the secrecy of telecommunications (Article 10a StGG), and the fundamental right to data protection (§ 1 Data Protection Act, DSG). Article 8 ECHR, on
the other hand, protects private and family life in general; also, it protects the home
and correspondence. Article 7 CFR protects private and family life, home, and
communication. Article 8 CFR guarantees the right to protection of personal data.
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Together, these provisions comprehensively protect privacy; the scope of application
overlaps in part, but the conditions for interference are different. Article 8 ECHR and
Article 7 CFR’s safeguarding of private and family life has a particular catchall
function. The broad notion of private and family life is open enough to accommodate
novel threats posed by new technologies (Wiederin, 2002, margin 4). Altogether,
they protect human privacy (Wiederin, 2002, margin 6; Grabenwarter & Pabel,
2021, p. 294).
From a historical perspective, partial aspects of privacy—namely, the protection
of the right of the home and respect for the secrecy of correspondence—are among
the oldest fundamental rights in the Austrian catalog of fundamental rights. Both
rights were already enshrined in continental Europe in the mid-nineteenth century.
The comprehensive protection of private and family life has been guaranteed since
the middle of the twentieth century, on the one hand, by the Universal Declaration of
Human Rights 1948 (Article 12) and then by Article 8 ECHR (Wiederin, 2002,
margin 1).
14.3
14.3.1
Right to Respect for Private Life
Protected Scope
According to Article 8 ECHR, everyone is entitled to “respect for his private and
family life, his home and his correspondence.” The scope of protection of this
fundamental right is the individual’s personality in its uniqueness, which also
manifests itself in the encounter and exchange with others. However, the selfdetermined lifestyle, the right to live a life according to one’s ideas, is protected
(Berka 2020, p. 487; Berka et al., 2020, p. 356; Öhlinger & Eberhard, 2019, margin
812; Wiederin, 2014, p. 374; Bezemek, 2016, p. 148; Meyer-Ladewig &
Nettesheim, 2017, margin 7; Grabenwarter & Pabel, 2021, p. 296, margin 6).
The delimitation of the scope of protection is difficult and also changeable. The
content is strongly influenced by social conventions and moral concepts and must
therefore be reassessed continuously (Wiederin, 2002, margin 7). However, indisputably the intimate and secret spheres are within the scope of application. Furthermore, behavior that appears in public, such as a visit to the theater or a stay in the
hospital, or even renting a movie in a public video store, is protected (VfGH
14.03.1991, G 148/90, European Case Law Identifier ECLI:AT:VFGH:1991:
G148.1990). The need for protection is also different. It is high when it concerns
the most intimate area of the person. This area includes sexual life, health, illnesses,
or relationships with partners, family members, friends, or confidants. And a high
need for protection also exists when people think they are unobserved (Berka et al.,
2020, p. 358). It is lower if the behavior takes place in public or one even addresses it
to the public (Grabenwarter & Pabel, 2021, p. 299). To put it in a few examples:
Disposing of one’s own body, even after death, is part of a person’s protected private
life (VfGH 08.10.2014, G 97/2013; ECLI:AT:VFGH:2014:G97.2013); the same
256
D. Hattenberger and F. Vidreis
applies to telephone calls, email, and Internet use at the workplace (ECtHR
03.04.2007, 62,617/00, Copland vs. the United Kingdom, ECLI:CE:ECHR:2007:
0403JUD006261700) or the private use of messenger services intended for business
use, even if the employer has prohibited private use (ECtHR 05.09.2017, 61,496/08,
Barbulescu
vs.
Romania
(Grand
Chamber),
ECLI:CE:ECHR:2017:
0905JUD006149608). The right to private life can also be violated if the state
refuses to change a person’s name after a gender reassignment or does not permit
a marriage. Interventions on the right to private life also occur when third parties
gain access to information from the private sphere, such as secret surveillance
measures, telephone tapping, the unwanted publication of photos, or surveillance
by a camera in public places (Öhlinger & Eberhard, 2019, margin 814). The
technical possibilities which are available to everyone today favor such information
interventions.
Article 8 ECHR also guarantees a right of access to one’s health data after
hospitalization (ECtHR 28.04.2009, 32,881/04, K.H. et al. vs. Slovakia, ECLI:CE:
ECHR:2009:0428JUD003288104) or to environmental information if it presents a
risk to data subjects. It also protects the formation of identity. The right to receive
information about the essential aspects of one’s identity is also covered by the
protection of private life (Meyer-Ladewig & Nettesheim, 2017, margin 22).
In its defensive dimension, the fundamental right is directed against the state. The
state must refrain from intervention unless it is justified. Apart from this, the state is
also obliged to protect the right to respect for private life from encroachment by third
parties. For example, the state has to prevent interventions on personal integrity by
third parties through appropriate penalization. The lawmakers also have to protect
the honor of the individual through proper regulations, to sanction rape under
criminal law (ECtHR 26.03.1985, 8978/80, X and Y vs. The Netherlands, ECLI:
CE:ECHR:1985:0326JUD000897880), and to take adequate precautions to ensure
that personal data such as an HIV infection are not disclosed (ECtHR 25.02.1997,
22,009/93, Z vs. Finland, ECLI:CE:ECHR:1997:0225JUD002200993). The legal
system must also protect the individual from unnecessary disturbance by prohibiting
anonymous telephone calls or the installation of surveillance cameras. Protection
against assault must also be provided in private employment relationships. If the
employer pronounces a dismissal because of an extramarital relationship of an
organist (ECtHR 23.09.2010, 1620/03, Schüth vs. Germany, ECLI:CE:
ECHR:2010:0923JUD000162003) or because of specific clothing such as the wearing of a pink hairband by a bus driver (OGH 24.09.2015, 9 ObA 82/15x, ECLI:AT:
OGH0002:2015:RS0130288), this contradicts Article 8 ECHR (Berka, 2018, p. 488;
Berka et al., 2020, p. 361; Bezemek, 2016, p. 158).
The fundamental right to protection of private life is not protected in absolute
terms. Once an interference has been established, the second step is to examine
whether the interference is permissible. If the admissibility check fails, then there is a
violation. Interference is permitted under the following conditions: It must be
14
Right to Privacy: A (re-)measurement
257
– Provided for by law
– And must be necessary in a democratic society to achieve specific objectives set
out in Article 8 (2)
Accordingly, interference is only permissible if a law authorizes it. The more
intensive the interference with the fundamental right, the more precisely the legal
authorization for the interference must be described. For example, secret wiretapping
measures are a particularly intensive intervention in the fundamental right to private
life. The prerequisites for such measures must be specified in detail in the law
(Meyer-Ladewig & Nettesheim, 2017, margin 37; Wiederin, 2002, margin 19).
Article 8 (2) ECHR lists national security, public peace and order, the economic
well-being of the country, the defense of law and order, the prevention of criminal
acts, the protection of health and morals, and the protection of the rights and
freedoms of others as legitimate objectives. National security plays a role in connection with telephone surveillance, for example. Restrictions in connection with
detention may be justified by public peace and order. The justification of protecting
the rights and freedoms of others includes, for example, the protection of minors or
the protection of secrets (Wiederin, 2002, margin 23). The legislature may regulate
people’s sexual lives only to the extent that it affects others’ rights or public order. If
prostitution, however, does not appear outwardly, then a ban is not necessary in a
democratic society and is therefore inadmissible (VfGH 09.03.1978, G 63/77; ECLI:
AT:VFGH:1978:G63.1978). A compulsory blood sample is only permissible as an
intervention on bodily integrity if a weighty interest justifies it. The scope of
protection of private life also includes the identity of a person. The denial of a
name change after a gender reassignment (ECtHR 25.03.1992, 13,343/87, B vs.
France, ECLI:CE:ECHR:1992:0325JUD001334387) is a violation of Article
8 ECHR. Also covered by the scope of protection is the right to indicate a third or
no gender in civil status records (VfGH 15.06.2018, G 77/2018, ECLI:AT:
VFGH:2018:G77.2018).
Article 8 ECHR also applies to information interventions that are only permissible if a law authorizes them and they are justified by public interest and withstand a
proportionality test. In recent years and decades, state authorities have been granted
extensive surveillance powers, such as large-scale eavesdropping, dragnet searches,
cell phone tracking, and access to private computers, which allow deep penetration
into the private sphere. These instruments are particularly intrusive because they are
used without the knowledge of those being eavesdropped on or observed in an area
where the persons concerned believe they are unobserved. Such interventions are
only justified if there are particularly weighty reasons—such as organized crime or
terrorist attacks—and mechanisms are provided to protect against abuse. Surveillance powers, which are typical for a police state, can only be permissible in a
democratic society in exceptional situations and within narrow limits (ECtHR
06.09.1978,
5029/71,
Klass
vs.
Germany,
ECLI:CE:ECHR:1978:
0906JUD000502971; Berka, 2020, p. 490).
258
14.3.2
D. Hattenberger and F. Vidreis
Examples of Case Law
The installation of a covert video surveillance system used by an employer to film
cashiers at a Spanish supermarket was the subject of a case before the ECtHR.
Cashiers claimed a violation of Article 8 ECHR because the surveillance system had
been installed without their knowledge. The employer had had the system installed
on suspicion of theft. This suspicion was also confirmed by analysis of the video
material. The Third Chamber (ECtHR 09.01.2018, 1874/13 and 8567/13, López
Ribalda et al. vs. Spain (Third Chamber), ECLI:CE:ECHR:2018:
0109JUD000187413) qualified the measure as disproportionate because it meant a
significant invasion of the privacy of the persons concerned.
Furthermore, the employer could have informed the female employees as a
palliative measure. The Grand Chamber of the ECtHR disagreed. Due to the short
duration of the secret surveillance and the limited possibilities available to the
employer to protect its property, it was not considered a violation of Article
8 ECHR (ECtHR 17.10.2019, 1874/13 and 8567/13, López Ribalda
et al. vs. Spain (Grand Chamber), ECLI:CE:ECHR:2019:1017JUD000187413).
In the Barbulescu case (ECtHR 12.01.2016, 61,496/08, Barbulescu vs. Romania
(Fourth Chamber), ECLI:CE:ECHR:2016:0112JUD006149608), the employee was
requested by his employer to create an account on the Yahoo messenger service to
respond to customer inquiries. According to the employer’s instructions, the
employee was only allowed to use the account for professional purposes. Subsequently, the employee used it for private purposes as well. The employer recorded
the use in real time, and Barbulescu was dismissed because of the personal use. The
Grand Chamber of the ECtHR considered this measure to be a violation of Article
8 ECHR. The employer should have informed the employee before the start of the
monitoring and explained the monitoring details. Immediate control of the content of
the communication without a reminder contradicts the principle of transparency
(ECtHR 05.09.2017, 61,496/08, Barbulescu vs. Romania (Grand
Chamber), ECLI:CE:ECHR:2017:0905JUD006149608).
The publication of photographs is an interference with private life protected by
Article 8 ECHR. In Caroline von Hannover v. Germany (ECtHR 24.06.2004,
59,320/00,
Von
Hannover
vs.
Germany,
ECLI:CE:ECHR:2004:
0624JUD005932000), the court made fundamental statements. In the context of
balancing the right to freedom of expression and the protection of privacy, the court
held that what mattered was whether the publication of the photographs contributed
to a public debate of general interest. This argument also applies to public figures.
14
Right to Privacy: A (re-)measurement
14.4
259
Protection of the Home
The inviolability of the right of the home is one of the oldest fundamental freedoms
of the national constitutional order. Protection against arbitrary house searches was
already granted by the law of 27.10.1862 on home law protection. It is now
guaranteed in Article 9 StGG. Besides, Article 8 ECHR and Article 7 CFR guarantee
a right to respect for the home. This right also serves to protect privacy. It intends to
ensure a space of retreat for the individual, protected from intrusion by third parties.
In addition to dwellings, the scope of protection also includes outbuildings, rooms
used for business purposes, houseboats or mobile homes. The term “dwelling” is to
be interpreted broadly (Öhlinger & Eberhard, 2019, margin 396; Meyer-Ladewig &
Nettesheim, 2017, margin 89; Grabenwarter & Pabel, 2021, p. 336).
The right of domicile, according to Article 9 StGG, offers protection against
unjustified house searches; this means the intrusion into the “dwelling or other
premises belonging to the household” for the purpose of searching for persons or
objects. A house search is only permissible if a law authorizes it and, in principle, the
individual house search was authorized by a judge. The necessity of a judicial order
is an expression that the home is exceptionally protected.
The protection afforded by Article 8 ECHR goes further. It protects against
unjustified house searches and intrusion into the home without the consent of the
owner. This also includes, for example, the unauthorized installation of listening
devices and video cameras (Berka, 2020, p. 502).
14.5
Protection of the Communication
Communication is constitutionally protected in different ways and with different
requirements. According to Article 10 StGG, the secrecy of correspondence is
inviolable. Sealed documents that are not intended for outsiders are covered by the
scope of protection. Interference occurs when sealed documents are opened to gain
knowledge of their contents. An intrusion is permissible if it takes place in the
context of a legal arrest or house search, in cases of war, and if a judge has approved
the opening in advance (Berka, 2020, p. 503; Öhlinger & Eberhard, 2019,
margin 381).
Again, the protection of correspondence by Article 8 ECHR goes further. It
protects not only written communication but also telephone conversations. Interference is also present if the correspondence is hindered by state authorities, for
example, if prisoners’ mail is not forwarded. According to the well-known formula
of Article 8 (2), interference is only permissible if a legitimate aim is pursued and the
measure is suitable, necessary, and proportionate. The Constitutional Court considered monitoring a prisoner’s correspondence with his lawyer to be unconstitutional
because postal communication with the lawyer must be possible on a confidential
basis (Berka, 2020, p. 504).
260
D. Hattenberger and F. Vidreis
The right to respect for the correspondence requires the state not only to refrain
from intervening but also to act actively. For example, Article 8 ECHR is also
violated if prisoners are not provided with sufficient writing material to communicate
with the court (ECtHR 24.02.2009, 63,258/00, Gagiu vs. Romania, ECLI:CE:
ECHR:2009:0224JUD006325800).
Article 10a StGG protects the secrecy of telecommunications. It covers the
communication transmitted via telecommunications networks, thus the telephony,
email correspondence, and other information sent via radio or communications
networks. Article 10a StGG protects the content of communications; external communications data such as names, telephone numbers, locations, call durations, or IP
addresses are not covered. According to Article 10a StGG, monitoring the content of
communications requires prior judicial approval. The judge’s reservation further
proves that the constitutional legislator intended that the protected freedom needs
special protection. For external communications data—also known as traffic data—
Article 8 ECHR provides protection (Berka, 2020, p. 504; Öhlinger & Eberhard,
2019, margin 826).
In recent years, the powers of the security police to conduct surveillance have
been considerably expanded. These include, for example, the collection of call data
with the obligation of providers to transmit IP addresses or the tracking of the
location to prevent threats to the life or health of people.
14.6
14.6.1
Protection of Personal Data
Scope of Application
Section 1 of the Austrian Data Protection Act (DSG) guarantees a fundamental right
to data protection. This fundamental right intends to set limits on the virtually
unlimited technical possibilities for processing personal data. First of all, it guarantees personal data confidentiality, provided that there is a legitimate interest in such
secrecy. “Personal data” is defined as all information relating to a person. The name
is just as much personal data as physical characteristics, value judgments, IP
addresses, biometric characteristics, illnesses, party affiliation, etc. It is only essential
that one can assign this information to a specific person. If personal data is generally
available or data cannot be traced back to a particular person, there is no interest in
confidentiality worthy of protection. Because of their general availability, data that
can be viewed in public books (such as the land register) are therefore not protected
by Sect. 1 of the Data Protection Act. The fundamental right to data protection
protects against collecting and disclosing personal data (Jahnel, 2020, p. 537;
Eberhard, 2016, margin 45; Pollirer et al., 2019, margin 1).
The personal scope of the fundamental right to data protection covers both natural
and legal persons. This means that companies can also invoke this fundamental right
to protect their economic data. This circumstance is remarkable in that the General
Data Protection Regulation only covers the data of natural persons (Jahnel, 2020,
14
Right to Privacy: A (re-)measurement
261
p. 537; Pollirer et al., 2019, margin 3). When a person dies, the protection afforded
by the fundamental right ends. This is justified with the argument that the right to
data protection has a highly personal character. However, the honor and privacy of a
deceased person—especially the “image of life”—are not without protection. Postmortem protection guarantees Article 8 ECHR (Eberhard, 2016, margin 27).
The fundamental right to data protection has gained enormous importance in the
recent past. This increase in importance is in step with the rapidly expanding
possibilities of technological progress in information and communication technologies. Almost unlimited networking, storage, and evaluation possibilities allow deep
penetration into the individual’s privacy (Eberhard, 2016, margin 2). The protection
goal is to enable and secure confidential communication between people (VfGH
27.06.2014, G 47/2012 et al., ECLI:AT:VFGH:2014:G47.2012).
The fundamental right to data protection is also not protected in absolute terms.
For example, a violation of the fundamental right does not occur if the processing is
carried out in the data subject’s vital interest. This would be the case, for example, if
a person’s life is in danger and he or she urgently needs help but is no longer able to
consent to data processing due to his or her condition. Furthermore, personal data
processing is also permissible if the person concerned has given his or her consent.
This is referred to as the right to informational self-determination and means that it
should be up to the individual to decide how much of their private life they wish to
share with others. Finally, the fundamental right to data protection can be restricted if
a statutory provision authorizes this, if this provision pursues a legitimate interest,
and if the principle of proportionality is observed. For example, a radio cell analysis
to investigate an offense punishable by more than 1 year’s imprisonment is only
proportionate if this measure is limited to a short period. The secrecy of communications of completely uninvolved persons may only be interfered with to the extent
that this is unavoidable (OGH 05.03.2015, 12 Os 93/14i, ECLI:AT:OGH0002:2015:
RS0129979).
Under Sect. 1 of the Data Protection Act, the right to secrecy is supplemented by
accompanying fundamental rights, which are also guaranteed by constitutional law.
These include the right to information, the right to rectify inaccurate personal data,
and the right to erase inadmissibly obtained personal data (Sect. 1 (3) of the Data
Protection Act).
The mass collection of personal data in the context of so-called section control
requires precise regulations on data collection and data use that make such interventions foreseeable (see Mueller et al. in this volume). Statistical surveys that include
personal data are an encroachment on fundamental rights. However, they can be
justified if the country’s economic well-being requires them, if they are limited to the
necessary extent, and if precautions are taken to ensure confidentiality (VfGH
15.06.2007, G 147/06 et al., ECLI:AT:VFGH:2007:G147.2006).
At the EU level, Article 7 CFR guarantees every person a right to protection of
personal data concerning them.
262
14.6.2
D. Hattenberger and F. Vidreis
Examples of Case Law
In the wake of 9/11 and the attacks in Madrid and London, the EU issued the
so-called Data Retention Directive (Directive 2006/24/EC of the European Parliament and of the Council of 15 March 2006 on the retention of data generated or
processed in connection with the provision of publicly available electronic communications services or of public communications networks and amending Directive
2002/58/EC, OJ L 2006/105, 54). This Directive requires that so-called traffic data
generated in the course of telephony, email, and Internet communications, such as
master data, location data, IP address, (Internet) telephone service provider, and time
of connection establishment, but not content data, be stored for at least 6 months and
a maximum of 2 years without any reason. The Directive aimed to combat serious
crime. The ECJ examined this Directive for its compatibility with Article 7 and
8 CFR. The ECJ found a violation of Article 7 and Article 8 CFR because the
Directive generally applies to all persons and all electronic means of communication
and all traffic data without any differentiation, limitation, or exception (ECJ
08.04.2014, C-293/12 and C-594/12, Digital Rights Ireland, ECLI:EU:C:2014:
238). Accordingly, it also applies to persons who have no connection with a serious
crime or whose communications are subject to professional secrecy under national
regulations. The Directive also does not provide any objective criterion concerning
the restriction of access, the number of persons authorized to access the data, and the
storage period’s determination. In this respect, the required limitation to what is
absolutely necessary is missing, and also, the requirement of precise prior determination of the intervention on fundamental rights is not met.
The decision of Google Spain and Google (ECJ 13.05.2014, C-131/12, Google
Spain SL, Google Inc., ECLI:EU:C:2014:317) attracted particular attention. The
proceedings’ subject was the request of a Spaniard to delete a specific result of a
search for a newspaper report. When entering his name in the Google search engine,
users were shown links to a third party’s newspaper reports. In these newspaper
reports, his name was mentioned in connection with the sale of a property due to a
seizure. The person concerned demanded deletion from the newspaper company as
well as from Google Spain and Google Inc. He was successful against the search
engine operator Google. First, the court affirmed the applicability of Article 7 CFR
because Google also operates a branch in Spain. Accordingly, EU law was applicable. The ECJ also confirmed a right to deletion or to be forgotten against the search
engine operator, regardless of whether the information still appears elsewhere on the
Internet. The deletion of the search results complies with the fundamental right to
data protection (ECJ 13.05.2014, C-131/12, Google Spain SL, Google Inc., para
19, ECLI:EU:C:2014:317). This decision is one of the most significant in the recent
past. According to another decision of the ECJ, the delisting must be carried out for
all Member States, but not for all country versions (ECJ 24.09.2019, C-507/17,
Google LLC vs. Commission nationale de l’informatique et des libertés (CNIL), para
73, ECLI:EU:C:2019:772).
14
Right to Privacy: A (re-)measurement
263
In two equally important decisions, the ECJ found that the level of data protection
guaranteed in the USA by the Safe Harbor and Privacy Shield agreements does not
meet the requirements of Article 7 and 8 CFR (Schrems I, ECJ 06.10.2015, C-362/
14, Schrems vs. Data Protection Commissioner, ECLI:EU:C:2015:650; Schrems II,
ECJ 16.07.2020, C-311/18, Data Protection Commissioner vs. Facebook Ireland
Limited and Schrems, ECLI:EU:C:2020:559; see Mueller et al. in this volume). The
subject of the legal dispute was the lawsuit filed by the Austrian Facebook user
Schrems. He criticized the transfer of his personal data collected by Facebook to
servers located in the USA because data protection was not adequately ensured. The
basis for the data transfer was the so-called Safe Harbor Agreement between the EU
and the USA. In 2000, the Commission certified that this agreement provided the
USA with an adequate data protection level. However, the Safe Harbor Agreement
only provided for a self-certification system by US companies; government authorities were not bound by it. Besides, the requirements of national security, public
interest, and law enforcement took precedence over the Safe Harbor Agreement, so
that US companies were obligated without restriction to interfere with the fundamental rights to respect for private life and the confidentiality of personal data. The
ECJ overturned the adequacy decision (ECJ 06.10.2015, C-362/14,
Schrems vs. Data Protection Commissioner, para 99, ECLI:EU:C:2015:650).
The ECJ ruled quite similarly in the Schrems II case. The EU Commission had
determined in Decision 2016/1250 that the EU-US Privacy Shield (“Privacy Shield
Decision”) guarantees an adequate data protection level. The Court of Justice took a
different view. The decision would, in turn, give undifferentiated priority to the
requirements of national security, public interests, and compliance with US law and
would not limit US surveillance programs to a strictly necessary minimum. Furthermore, no rights are granted to affected persons, so that there is again a violation of
Article 7 and 8 CFR.
14.7
Conclusion and Future Outlook
The right to privacy encompasses a multitude of partial aspects of personality, which
are also reflected at the legal system level. The constitutional order, including the law
of the European Union and the European Convention on Human Rights, shows this
complexity by protecting aspects such as the secrecy of personal data or the
confidentiality of telecommunications as well as private life in general. The scope
of protection is broad, but the question of the limits of fundamental rights must be
asked each time anew and, because of rapidly changing threats, must also be
redefined. Given the technical possibilities, the threat situation is tenser than ever.
A wide range of information interventions are no longer the sole preserve of the
state, which carries them out in the interest of the common good, but are also
possible for private individuals. The state is therefore required more than ever to
delimit the freedoms of individuals carefully. However, there are two main reasons
why the private sphere is threatened in the sense of a self-determined way of life.
264
D. Hattenberger and F. Vidreis
Those who want to participate in the blessings of the information society will not be
able to avoid giving up parts of their private sphere. Those who consistently refuse to
disclose their data will inevitably have to do without certain services (Berka, 2018,
p. 760). Another threat is the market power that certain internationally active media
such as Facebook have accumulated in recent years. As recent developments show,
they are equally decisive in protecting privacy and freedom of expression (e.g., by
blocking accounts). Bringing them under control is a challenge that can only be met
through concerted international efforts (Berka, 2018, p. 761).
14.8
Exercise and Reflexive Questions
1. How do you rate your behavior? Do you tend to be generous or sparing with
information from your private sphere?
2. Why is protecting privacy in the context of an employment relationship a
particular challenge?
3. How do you assess the expansion of state surveillance instruments concerning the
protection of privacy?
4. What is the state’s role in protecting individuals from invasions of privacy by
private third parties?
5. What do you think about cookie protection as companies and authorities currently
implement it?
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(Eds.), Handbuch der Grundrechte – Grundrechte in Österreich (pp. 363–418). C.F. Müller.
Doris Hattenberger is Assistant Professor at the Department of
Law of the University of Klagenfurt. Her research areas concern
IT law; environmental law; the European Union Law, especially in
the field of economic policy; and university law. For further
information, please see https://www.aau.at/rechtswissenschaften/
oeffentliches-recht/team/hattenberger-doris/.
Florian Vidreis, LL.M. (WU) BSc is a former student assistant
in the area of public law at the Department of Law of the Faculty
of Management and Economics at the University of Klagenfurt
with a research focus on fundamental and human rights law and
media law. He currently works as an associate in the areas of
Corporate/M&A and Banking & Finance at Fellner Wratzfeld &
Partner. For further information, please see https://www.fwp.at/
juristinnen/florian-vidreis.
Chapter 15
Managing Change Related to Consumer
Privacy Laws: Targeting and Personal Data
Use in a More Regulated Environment
Sophia Mueller, Charles R. Taylor, and Barbara Mueller
Abstract Internet usage among consumers, which encompasses a wide variety of
activities ranging from social media to e-commerce, has exploded in recent years.
Increasingly, marketers are using the trail of personal data consumers leave behind to
achieve more precise marketing tactics and may even sell this information to third
parties. This has led to growing concerns over the privacy of personal data. Despite a
number of large corporations’ data breaches—which should serve as a dire warning—many companies still do not take sufficient precautions when it comes to
consumers’ data. As consumer trust diminishes, some governments are taking a
stand to protect data that until now, consumers have freely given away. In this
environment, changes in the way data is collected and compiled are likely and will
need to be managed. This chapter outlines a number of cases of data misuse, growing
global concern over data privacy, and regulations that governments are already
considering or have already passed to combat data mismanagement. Implications
for marketers in this increasingly complex regulatory environment are outlined and
recommendations given.
15.1
Introduction
On a daily basis, billions of people around the world use their computers and
cellphones to access the Internet in order to conduct banking, make purchases,
check the news or weather, and to keep in touch with family, friends, and colleagues.
S. Mueller (*)
University of Florida, Gainesville, FL, USA
e-mail: smueller@ufl.edu
C. R. Taylor
Villanova School of Business, Villanova, PA, USA
e-mail: raymond.taylor@villanova.edu
B. Mueller
San Diego State University, San Diego, CA, USA
e-mail: muelle1@sdsu.edu
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_15
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In each case, the individual leaves behind personal data—the information trail that
results from any type of Internet usage. Corporations use this information to achieve
more precise marketing tactics—by targeting advertisements, offering rewards or
discounts, and generally providing customers with a more personalized experience
based on their individual preferences (see Terlutter & Ninaus in this volume). Some
companies also sell this data to third-party data brokers. Such brokers gather
information about a customer’s behavior across multiple interactions with various
entities: for example, a credit card company, car dealership, online shopping site, etc.
This rich information about a consumer’s behavior can be sold yet again. Moreover,
the collection of consumer data has become ever more sophisticated, resulting in
ever more detailed consumer profiles. Big data refers to enormous data sets that
cannot be collected, stored, or processed using any of the existing conventional tools
due to their quantity and complexity (see Green & Malthouse in this volume). The
global big data market is forecasted to grow to $103 billion by 2027, more than
double its market size in 2018 (Liu, 2019a). Big data analytics refers to the use of
advanced analytical tools, such as predictive analytics and data mining, to extract
value from big data and generate insights for firms. The benefits for firms are, of
course, significant. According to the McKinsey Global Institute, it is estimated that
data-driven organizations are 23 times more likely to acquire customers than their
peers. These organizations are also six times more likely to retain customers and
19 times more likely to be profitable as a result (Bokman et al., 2014).
There is mounting evidence that companies capitalizing on data-based decisionmaking are on the increase. Indeed, according to a global survey, the adoption rate of
big data has improved consistently every year from 2015 to 2018, with nearly 60c of
organizations having claimed to use big data in 2018 (Dresner Advisory Services,
2018). A recent survey of US Fortune 1000 companies conducted by New Vantage
suggests over 97% are investing in big data. And, success has led firms to up their
investment in big data. New Vantage’s survey indicated growth in the number of
firms investing between $50 million and $500 million in such initiatives grew from
27% in 2018 to nearly 40% in 2019 (New Vantage Partners, 2019). According to the
Worldwide Semiannual Big Data Analytics Spending Guide released by IDC,
companies spent about $189 billion on big data and analytics (BDA) in 2019 (Liu,
2019b). This figure represents an increase of 12% over 2018, and estimates suggest
worldwide BDA revenue will reach $274.3 billion (IDC, 2019). On a geographic
basis, the USA is the largest country market by a wide margin with nearly $100 billion in BDA revenues forecast for 2019. Japan and the UK were expected to generate
revenues of $9.6 and $9.2 billion, respectively, followed by China ($8.6 billion) and
Germany (7.9 million). The fastest-growing big data and analytics markets are
estimated to be Argentina and Vietnam (IDC, 2019). According to the same report,
the industries accounting for the greatest share of big data and analytics revenues
worldwide in 2019 were banking (13.9%), discrete manufacturing (11.3%), process
manufacturing (8.2%), professional services (8.2%), and federal/central government
(6.8%), with these five making up nearly half of the global revenue generation (Liu,
2019b). Between 2018 and 2022, the fastest growth is expected to come from
investment services and retail. Retail’s strong growth will enable it to move ahead
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of federal/central government as the fifth largest industry by 2022. In terms of
company size, those corporations with upward of 1000 employees will be responsible for nearly two-thirds of all BDA revenues, while small- and medium-sized
businesses will also be a significant contributor to BDA revenues, with almost a
quarter of the worldwide revenue coming from firms with less than 500 employees
(IDA, 2019). Firms unwilling to jump on the big data bandwagon face dire consequences. According to an Accenture study, 79% of executives agree that companies
that do not embrace big data will lose their competitive position and could face
extinction (Columbus, 2018).
Personal data is often compared to oil. Indeed, back in 2017, The Economist
claimed that data replaced oil as the world’s most valuable commodity (The Economist, 2017). When individuals use their computers and smartphones, they share
endless amounts of personal data. Health records, social security numbers, and
banking details make up the most sensitive information stored online. Less sensitive
examples of personal data include social media posts, location data, and even searchengine queries. One aim of data collection conducted by firms is for the purpose of
profiling customers and potentially targeting the promotion of goods and services to
them based on their traits and habits. In some instances, the trade-off between the
data that consumers share and the benefits they receive may be worthwhile: for
example, when browsing online retailers, many consumers are happy to use
“recommended for you” or “people who purchased this also bought” suggestions
to aid in making purchase decisions. And, when consumers receive an ad regarding
an airfare sale for a vacation destination they are interested in or a message calling
attention to a newly released clothing item they find appealing, both the advertiser
and the customer benefit. On the other hand, sometimes the use of big data misfires,
as is the case when consumers scroll through their social media feed and find an
apparel ad for a team that just beat their favorite team in a big game or when they
receive notification of discounted hotel rooms after having already booked their
reservation. But, when consumers realize their personal data has been shared with or
sold to third (and in some cases, fourth) parties, it is no surprise that many become
increasingly cynical about corporations’ data protection claims, promises, and policies. Given the present environment, which includes increased concern about data
collection, merging, and sharing processes, it is critical that companies consider how
they will manage the situation.
15.1.1
The Misuse and Abuse of Personal Data
2018 was host to a number of high-profile data breaches that compromised billions
of Internet user accounts. In each case, impacted firms suffered financial loses in the
form of breach-related expenses, diminished stock value, and regulatory fines. Of
much greater consequence was the loss of consumer trust. The Facebook-Cambridge
Analytica scandal broke in March of 2018 when it was revealed that the Londonbased data-mining firm had harvested the personal data of up to 87 million Facebook
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user’s profiles worldwide without their permission and used it for political advertising purposes. Cambridge Analytica obtained the information through an app that
could identify the personalities of American voters and potentially influence their
behavior. The data collected also included details on users’ identities, friend networks, and “likes.” The firm, hired by President Donald Trump’s 2016 election
campaign, used the data in an attempt to target audiences with digital ads and thereby
influence election results. While Facebook routinely allows researchers to have
access to user data for academic purposes (which users consent to when they create
a Facebook account), the social media giant “prohibits this kind of data to be sold or
transferred to any ad network, data broker or other advertising or monetizationrelated service” (Granville, 2018). Cambridge Analytica initially denied that they
obtained or used the Facebook data, but later changed their story. Facebook
demanded and received certification that the data had been destroyed and promised
users it would make its pages and ads more transparent. It also made changes to its
platform to restrict the information that app developers could access. Nonetheless,
the Federal Trade Commission fined Facebook $5 billion—the largest fine ever
imposed by the US consumer protection agency. The UK’s Information Commissioner’s office fined them another £500,000 (about $643,000), noting that UK
citizen data was exposed to serious risk. Additionally, their stock price fell approximately 14% in the aftermath of the scandal, and both advertisers and users left the
social media network.
In March of 2018, Google also faced a data scandal. Engineers within the
company discovered a software bug in the Google+ social network, which exposed
user information. The glitch gave outside developers the opportunity to access user’s
Google+ profile data for a whopping 3 years, between 2015 and 2018 (O’Flaherty,
2018). The bug was immediately repaired; however approximately 500,000 Google
+ private user’s data (such as name, email address, birth dates, occupation, gender,
age, relationship status, and profile photos) was made available to the public. Google
initially chose not to disclose the leak to its consumer database or the public because
it feared damage to its reputation as well as regulatory scrutiny. The scandal was
ultimately revealed in a Wall Street Journal article in August, 6 months after the
initial discovery. In November, Google revealed a second bug in the Google+ API
that could have been abused to access the private data of over 50 million people.
Google reported that the bug allowed apps, which were granted permission to view
Google+ profile data, to incorrectly receive permission to view profile information
the user had set to non-public. Once again the breach was quickly repaired and
Google reported no evidence that the system was compromised by any third party.
Due to the data breaches, Google+ was shut down by the social media network in
2019. In early 2019, Google was fined €50 million (around $57 million) by the
French Data regulator CNIL (National Data Protection Commission) for violations
of privacy laws. More recently in 2020, Google agreed to pay $7.5 million in a
settlement to resolve a class-action suit brought against the firm (CISOMAG, 2020).
It is no surprise that such scandals coincide with mounting privacy concerns around
the globe.
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Global Concerns About Online Privacy
Globally, concern over Internet privacy is generally high. In particular, Internet users
globally are worried about risks to their online privacy: a recent survey found that
75% of Internet users from New Zealand, 70% from Canada, 68% from Australia,
66% from the USA, 65% from the UK, 62% from China, 61% from Germany, 61%
from Mexico, 61% from Taiwan, 57% from the UAE, 56% from Japan, 55% from
France, 52% from Italy, and 51% from Hong Kong were concerned (Clement,
2019a). Additionally, based on a survey of 25 economies around the world, it
appears that such concern has only increased over the years. Comparing data from
2019 vs. 2018, 65% of Internet users in Latin America are more concerned about
their online privacy as compared to a year earlier, while 63% of those in the Middle
East and Africa had similar concerns. Nearly half (48%) of North Americans’
concerns had increased, and a smaller percentage of consumers in Europe (39%)
expressed growing concerns (Clement, 2019b).
While consumers realize they share vast amounts of digital data, they perceive
various forms of data differently. A survey of adults in the USA, UK, Germany, and
France found that 78% of consumers fear losing control over financial/banking data,
75% fear losing control over security information, and 70% fear the loss of identity
information. Just over 60% (61%) fear losing control over medical information, and
another 57% were concerned over the loss of their contact information. Boomers in
the four markets surveyed cared more about these top five pieces of information than
the other age groups. In contrast, Gen Zs expressed greater concern over information
related to their location, as well as their photos and videos. An interesting aspect of
this survey was that European attitudes toward data privacy were not uniform. The
French were found to be less protective of their personal information than their
German and UK counterparts across almost all categories of data surveyed (RSA,
2019).
Consumers are growing increasingly concerned about the benefits of sharing
personal data, the security of their data, whether their data will intentionally or
unintentionally be shared with third parties, comprehending company privacy policies, personal control over their data, and the laws in place to protect it (see
Hattenberger & Vidreis in this volume). According to a recent survey by the Pew
Research Center, a large share of US adults are not convinced they benefit from the
widespread gathering of data (Auxier et al., 2019). Some 81% of American adults
say the potential risks they face outweigh the benefits. And 79% of Americans report
being concerned about the way their data is being used by firms. The majority of the
US public is not confident that corporations are good stewards of the data they
collect. For example, 79% say they are not very, or not at all, confident that
companies will admit mistakes and take responsibility if they misuse or compromise
personal information. There is also a collective sentiment that consumer data is less
secure than in the past. Nearly three quarters (70%) of US adults say their personal
data is less secure than it was just 5 years ago. And despite concerns, many
Americans acknowledge they are not always diligent about paying attention to
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privacy policies. While nearly all Americans report being asked to approve privacy
policies, only about one in five adults say they always (9%) or often (13%) read a
company’s privacy policy before agreeing to it. The survey also found a general lack
of understanding about data privacy laws among the general population: two-thirds
(63%) of Americans note they understand very little or nothing about the laws and
regulations that are currently in place to protect their data privacy. With regard to the
prevalence of tracking, 72% of Americans report feeling that all, almost all, or most
of what they do online or while using their cellphones is being tracked by advertisers
or technology firms of other companies. Finally, eight in ten Americans say they
have very little or no control over the data companies collect about them. Consumers
are reluctant to share information because they know little of how much of their
information is collected, who gets to look at it, and what it is worth.
A corporation’s privacy policies (or lack thereof) regarding the collection and use
of data (including the sales to third parties) have significant impacts on consumers’
behaviors regarding the sharing of data. A recent survey by Euromonitor of 40,000
respondents across 40 markets revealed that consumers are growing increasingly
conscious about managing their personal data and restricting the type of information
they share online. According to the survey, age plays a role in the degree to which
consumers actively manage data sharing and privacy settings and the degree to
which they freely share personal information online. Over 60% of those aged
30–44 reported actively managing data sharing and privacy settings. The youngest
and oldest cohorts are less likely to actively manage the way their data is shared,
suggesting they may be less concerned or less knowledgeable regarding how to
monitor their privacy settings. Younger consumers tended to be more willing to
share their data in exchange for personalized offers, but they expected transparency
in how the data will be used. Those over the age of 60 were least willing to share
personal information online (Byron, 2020).
Global concerns regarding the sharing of data are mirrored in the behavior of
Americans. According to data collected by the US Census Bureau, up to 45% of
households that engage in online activities reported that concerns about data privacy
stopped them from conducting financial transactions, buying goods or services,
posting on social networks, or expressing opinions on controversial or political
issues via the Internet. Results of an Advertising Research Foundation (ARF) survey
found that US consumers were less likely in 2019 to share personal information than
they were just 1 year earlier, including even basic personal information. According
to the ARF, the number of individuals willing to share their home address fell from
41% to 31% between 2018 and 2019. Those willing to share the name of their spouse
decreased from 41% to 33%. Only 54% indicated they would be willing to share
their email address—down from 61% the previous year (Swant, 2019).
A Euromonitor survey of consumers in 40 countries suggested that privacy
concerns would be a top consumer trend for 2020 (Byron, 2020). But just who
should be responsible for the security of consumers’ data? According to a recent
survey of consumers across ten markets and on four continents conducted by the
Global Alliance of Data-Driven Marketing Associations and Acxiom, the answer to
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that question is, apparently, consumers themselves (Data and Marketing Association, 2019). When asked whether the government, industry, or individual consumers
should have ultimate responsibility for data security, on average, 38% of consumers
globally claimed they have ultimate responsibility for their own data security. Just
15% suggested that government institutions have ultimate responsibility, and a mere
5% believed that brands and organizations did. Just over one-third (35%) were of the
opinion that such responsibility should be held by a combination of these options.
However, views did vary across markets. Consumers in Spain and the Netherlands,
for example, placed significantly more responsibility on government institutions. In
comparison, consumers in Germany, Australia, the UK, and the USA were much
more likely to suggest that consumers themselves should be the ultimate gatekeepers
of their own data. Indeed, in the USA only 6% believed the ultimate responsibility
should lie with government institutions, compared to 43% who claimed it should lie
with consumers (Data and Marketing Association, 2019).
15.2
Regulation/Policy
In an environment where online privacy has garnered more scrutiny from global
consumers in the past few years than ever before, especially in the context of
marketing over the Internet, it is no surprise that the issue is receiving increasing
attention from regulators. Europe has historically emphasized privacy as a basic
human right, focusing on “opt-in” systems, whereby marketers were required to
receive a consumer’s consent to send them messages, whether by mail, phone, or via
the Internet (Monahan, 1998). In contrast, the USA has traditionally emphasized a
free flow of information, balancing the needs of marketers and consumers and
requiring consumers to “opt-out” of receiving messages they do not want (Maynard
& Taylor, 1996). Based on growing consumer concerns over data privacy, a number
of governments are either considering, or have already passed, legislation aimed at
restricting how marketers can collect and use consumer data. In particular, data
management platforms (DMPs) have seen the brunt of regulatory attention, specifically pertaining to the degree to which they can be used to collect and merge data
from consumers. However, due to the divergent beliefs of various governments, the
degree of severity of these laws varies: it is unsurprising that the most comprehensive regulations pertaining to consumer privacy have been passed by the European
Union. For some countries, these regulations are still in their infancy, while other
nations and states, including California, have already passed legislation that is
similar in spirit to that of the European Union’s. Companies are being forced to
adapt to these regulatory changes and face the prospect of additional regulation. In
the following sections, these regulatory efforts are reviewed.
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Europe’s General Data Protection Regulation (GDPR)
After 4 years of debate, the General Data Protection Regulation (GDPR) was finally
passed by the European Parliament in April 2016 and went into full effect as of May
2018. The regulation was significant in that it both codified and unified privacy laws
across the European member nations. The overarching goal of the GDPR was
twofold: (1) give EU citizens new rights to personal data, and (2) place restrictions
on companies’ use of consumer data for marketing purposes (Goldberg, Johnson &
Shriver, 2019). Specific provisions of the GDPR included defining personal data,
delineating consumers’ data rights, placing limitations on data use by data controllers and data providers, requiring the use of “privacy by design” by data controllers,
specifying breach notification procedures for enforcement, imposing penalties for
breaches, and applying consumer rights to companies outside of Europe (Seaton,
2018; European Commission, 2020).
The GDPR defines personal data broadly as any information that is related to an
identified or identifiable natural person. In this context, personal data can refer not
only to basic identifiers such as an individual’s name, email, address, phone number,
or personal identification number, but is extended to include all information related
to a person’s identity, including mobile device identifiers or biometric data (e.g.,
fingerprints) (Seaton, 2018). The breadth of information that the definition encompasses is an important provision, as it addresses potential loopholes through which
companies may have attempted to build data management platforms by merging
individual level data that would otherwise not be covered under the regulation.
Consumers are granted eight fundamental data rights under GDPR. Collectively,
these provisions essentially force companies to obtain consumer consent to use or
share their data, inform customers how their data will be used, and what their legal
rights are if an abuse occurs (Johnson & Shriver, 2019). These rights are outlined in
Chap. 3, articles 12 to 23 of the regulation, and include (European Commission,
2020; Urban et al., 2019):
– Right to Access Personal Data—refers to the ability to access data collected on
them by a data controller.
– Right to Rectification—individuals can request modification of their data, including the correction of errors or updating of incomplete information.
– Right to Erasure—allows a subject to stop all processing of their data and request
that it be erased.
– Right to Restrict Data Processing—allows requests to stop all processing of one’s
personal data.
– Right to be Notified—data subjects must be clearly informed about the uses of
their personal data and informed of their rights.
– Right to Data Portability—allows individuals to request personal data be electronically sent to a third party.
– Right to Object—if a stop data processing request is rejected, an individual can
object.
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– Right to Reject Automated Individual Decision-Making—individuals can refuse
the automated processing of their personal data by organizations to make decisions about them if it affects the data subject or produces legal effects.
Restrictions placed on companies’ use of data under the GDPR are substantial.
The “privacy by design” provision forces companies to explicitly build in compliance mechanisms into their data management procedures from their initial conception (European Commission, 2020). The breach notification provision forces a
company to report to an agency within 72 h of a breach. Penalties for violations
are significant, and fines can be as high as 4% of annual corporate revenue. The
regulation also makes clear that it applies to countries outside the EU, encompassing
both companies that are based in the EU doing business elsewhere and companies
from outside the EU doing business within the EU.
15.2.2
The EU’s ePrivacy Directive and Privacy Shields
Two additional aspects of regulation stem from the European Union—privacy
shields and the EU’s ePrivacy Directive. Prior to GDPR, the European Union had
put forward the ePrivacy Directive (see ePrivacy Directive (2020) in 2002 (amended
in 2009) which was designed to regulate data confidentiality, spam, use of cookies,
information confidentiality, and related issues (Seaton, 2018). The main provisions
of the Directive include providing security to users of online services, protecting the
confidentiality of information, dealing with data retention by erasing or anonymizing
traffic data when no longer needed, prohibiting the use of email addresses for
marketing purposes unless the user has opted in, and regulating the use of cookies
(Hintze, 2017). Historically, the ePrivacy Directive has been criticized for having
enforcement issues. Recently, there have been efforts to update the ePrivacy Directive to be more clearly harmonized with GDPR.
A privacy shield is a framework that allows all companies from varying countries
in a given transaction to transfer data through means that are compliant with all of the
privacy laws that they must abide by. The most prominent example is the EU-US
Privacy Shield Framework, which allows companies to opt in to join. The USA also
has such an agreement with Switzerland. For US companies, this means selfcertifying with the US Department of Commerce, which ensures that it is in
compliance with Privacy Shield Principles. Privacy shields generally include a
provision for penalties for noncompliance, which are enforced by the US Federal
Trade Commission. The likelihood is high that other countries, or groups of countries, will develop privacy shields to help foster international trade.
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The California Consumer Privacy Act (CCPA)
Following the lead of the European Union’s GDPR, the California legislature passed
a state law in 2018 that granted additional rights to consumers, including the ability
to access or delete personal information collected by businesses and limit the sharing
of such data. The law, which went into effect in 2020, grants consumers the right to
know what data is being collected about them, the purpose for which it is to be used,
as well as whether, and to whom, it is being sold (Pardau, 2018). It not only grants
consumers access to their personal data but allows greater control over their data,
including restricting who it will be sold to and the ability to delete it. An innovative
provision included in the law is one that protects consumers from discrimination if
they exercise their privacy rights (Williams & Irion, 2018).
In contrast to GDPR, to fall under the jurisdiction of the CCPA, companies must
meet one of three criteria (State of California Justice Department, 2018). These
criteria are fairly broad and consist of (1) gross revenues of more than $25 million,
(2) engaging in the business of procuring or selling personally identifiable information on 50,000 or more people, or (3) earning more than half of their revenue from
the sale of data. Companies covered under the Act must disclose what data they
collect and obtain consent from consumers both to collect and share data. As with the
GDPR, there is little doubt that the CCPA makes it considerably more difficult to
collect data designed to create data management platforms that are used to target
consumers in marketing communications based on merged individual data. Given
that California is often a “laboratory for new ideas” (Williams & Irion, 2018), the
implementation of the law will be closely watched, and some believe it will lead to
additional protections in other states or even throughout the USA as a whole.
15.2.4
Vermont Data Broker Law (VDBL)
In 2018, the legislature of the state of Vermont passed a law specifically aimed at
placing restrictions on data broker (Vermont Office of the Attorney General, 2018).
Data brokers were defined as companies that knowingly collect personal information
on consumers, which they subsequently sell or license to third parties (Vermont
Office of the Attorney General, 2018). The legislation was designed to provide
consumers with information about elusive brokers, so that they could opt out of
having their information shared (Helveston, 2019). The law requires data brokers to
register with the state, pay fees, and provide disclosures about their operations. The
Law also strictly prohibits acquiring consumer information via fraudulent means.
Violations of the VDBL can result in fines, and the Law grants those whose rights are
violated the right to file civil lawsuits against data brokers (Helveston, 2019). While
the VDBL is more narrowly targeted at data brokers, it is aimed at better protecting
consumer privacy.
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Other US States
In addition to California and Vermont, Nevada has recently passed a law
(NevadaNRS § 603A.300) aimed at giving consumers more rights with respect to
the use of their data. The Nevada law requires that those collecting data provide a
request address to which a consumer can direct a request to opt out of the sale of
individual data covered under the act. Lack of compliance can lead to civil penalties
or injunctions. Additional states throughout the USA are beginning to pass data
privacy laws, to varying degrees. According to the National Conference of State
Legislatures, at least 20 states have passed legislation relevant to consumer privacy,
including the areas of children’s online privacy, e-readers, and websites (National
Council of State Legislatures, 2020). Other states, including Georgia, are still
considering legislation.
15.2.6
India’s Data Privacy Framework and the Future
Inspired in part by the GDPR and the CCPA, other countries are seeking to
strengthen their privacy protections. As of this writing, India is on the verge of
passing a law related to data privacy, restricting how corporations can collect and
share information on consumers. However, the legislation has been criticized by
some. As the law exempts the government from its regulations, some believe that
there is a move toward governmental control over the Internet (Goel, 2019). With the
exception of the exclusion of the government from the regulation, the proposed
provisions have some similarities with GDPR and CCPA.
It is clear that more attention is being paid to data privacy than ever before and the
coming years will, no doubt, see other countries becoming involved in considering
and/or passing such regulations. Below, we review how companies are managing
change in data collection and consumer targeting in the current environment.
15.3
Reactions to the Trend Toward More Data Privacy
Regulation
Considering the new privacy laws that have already gone into effect and those that
will be doing so shortly, as well as potential data privacy laws that may be on the
horizon, it is wise to consider the current attitudes of both consumers and marketing
practitioners. As noted previously, many consumers are concerned about their online
privacy (Boudet et al., 2019). Within the USA, consumers neither believe they have
control over their data, nor do they believe that companies handle their private
information responsibly, as the majority are convinced that firms are vulnerable to
hacks and cyberattacks (PWC, 2017). This has led to a decrease in Internet usage
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among consumers (Boudet et al., 2019). Although they are willing to share their
personal information when they trust a company, the majority of consumers in a
national survey indicated that they would take their business elsewhere should that
firm break their trust (PWC, 2017). Thus, marketers are facing consumers wary of
their practices when it comes to personal data, though eager to provide such
information should trust be at the core of the relationship. European consumers are
fatigued with the onslaught of privacy notifications brought on by the GDPR, as
more than 60% of popular websites display consent notices (Utz et al., 2019). This is
a situation that consumers globally will need to contend with in the coming years. On
the other side are the marketers who are required to put these new laws into practice.
A recent survey of senior marketing leaders indicated that they may be viewing the
data privacy world with rose-colored glasses: “64% said that they don’t think
regulations will limit current practices, and 51% said that they don’t think consumers
will limit access to their data” (Boudet et al., 2019). This may be an increasingly
unwise stance to take, as the GDPR has already cracked down on British Airways
and Marriott, fining the two companies $230 million and $123 million, respectively,
representing roughly 1.5% of their global turnover (Fazzini, 2019). Additionally,
Google was hit with a $57 million penalty in 2019 for a lack of transparency, and
Facebook accrued a fine of $5 billion for their Cambridge Analytica scandal. These
two tech giants are still under investigation by the EU for further infringements. Such
fines are significant not only in terms of their monetary impact but also as a means
for marketers to learn how regulators are interpreting broad laws such as the GDPR,
which provided little guidance regarding implementation.
These data privacy laws, then, come with both benefits and drawbacks for
marketers. There are indeed a number of challenges that marketers must consider.
First and foremost is the cost of aligning internal policies with data protection
legislation requirements. Particularly in the USA, a patchwork of individual statelevel laws may create a legal environment that is increasingly difficult to navigate
(Beckerman, 2019). And, all of these laws are subject to change, which will result in
the ballooning cost of compliance over time. Furthermore, consumers may not be
able to trust that their data is truly safe, as the mechanisms put in place to protect their
data are by no means foolproof. Indeed, prior research has determined that identities
can be stolen through the “Right of Access” clause in the CCPR (Pavur & Knerr,
2019). Currently, organizations do not have proper safeguards in place to deter abuse
of this clause and “risk exposing sensitive information to unauthorized third parties”
(Pavur & Knerr, 2019). The only way around this may be to ask for even more
information from consumers, which counters the original intent of the laws (Hill,
2020). On the upside, a clear advantage for businesses are the positive effects the
laws will have on consumers. Should a company properly implement data privacy
protocol, consumers’ concerns surrounding the handling of their private information
may be quelled, and trust in companies could increase, leading to an uptick in the
data they allow marketers to collect. This will be particularly evident should the
“privacy as a feature” strategy be put to use: “privacy functionality can be marketed
as an additional product feature, emphasizing how the organization respects its
users’ data by not selling information to third party suppliers” (Allison, 2019).
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Additionally, through more rigorous requirements regarding data protection, companies will be less likely to fall prey to large-scale data breaches, which will result in
both tangible (monetary) and intangible (reputational) benefits. Furthermore, the
“significant resources saved by not being required to invest in costly data processing
and associated administration” (Allison, 2019) are a major benefit to marketers.
These savings can even extend to hardware costs, as companies will not require as
much storage capacity. Although the drawbacks of data privacy laws are many, the
overall benefits do outweigh these negatives. This has been documented through
research, as “transparency and control in a firm’s data management practices can
indeed suppress the negative effects of consumer data vulnerability” (Martin et al.,
2017, p. 36). Should a company fail to engage in data privacy measures, they will be
left vulnerable to negative outcomes including abnormal stock returns. Additionally,
consumers may undertake behaviors that are damaging to the company, including
spreading of negative word of mouth, switching to another company, and falsifying
information.
Moving forward with implementing these new data laws, marketers will need to
adapt to three potential core areas of change: data collection, data storage and
processing, and the termination of a customer relationship (Menon, 2019). First and
foremost, the data collection process may look dramatically different for marketers
in the near term. Consumers will need to be made aware of the data collection
processes through informed consent, but marketers must be wary of overwhelming
their customers by offering them too many different data privacy options (Utz et al.,
2019). Prior research has indicated that the highest interaction rates with data privacy
pop-ups come about when consumers are given only two options (though this will
depend on a specific country’s legal requirements). Such small implementation
decisions will impact how consumers act with the content that a company provides.
This process will place the customer in the driver’s seat, as they will feel more in
control over their data, reducing uncertainty and the perception of sneaky behaviors
(Walker & Moran, 2019). However, due to the fatigue that customers are facing
concerning the onslaught of data collection notices, we may not be far off from a
comprehensive solution that provides more control relative to a yes/no answer,
though does not impede the browsing of every single website a consumer visits
(Utz et al., 2019). This will be particularly useful for transactions conducted on AI
devices, where the number of parties involved in the purchasing process is increasing, and multiple consents will need to be in place (Sullivan, 2018). The type of data
that is collected will also shift. Under the strictest data privacy guideline, the GDPR,
“only data that is relevant, required, and limited to the conversion of a prospective
buyer can be collected” (Menon, 2019, p. 80). Some marketers may wish to follow a
different path and significantly reduce their dependence on data, while not falling to
the “spray and pray” tactics of years gone by. One means of doing this is to alter the
targeting format: marketers should consider centering their online advertisements on
individual consumers as opposed to behavioral targeting.
Instead of leaning on traditional data management platforms, a marketer may
wish to rely on the content of the web page or social media site that the customer is
using. Content-based advertising capitalizes on the pairing of AI, content, and
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context-based data (Taylor, 2019a, 2019b). This works particularly well for video
viewing websites, ranging from social media to streaming services. And, such
marketing tactics may mean the annihilation of data platforms. Another novel
technique is to incentivize consumers by paying them to watch advertisements via
plugins (Taylor, 2019a, 2019b). This may allow the circumvention of advertisingblocking ad-ons, which were used by “more than 650 million people worldwide last
year, costing advertisers an estimated $40 billion” (Taylor, 2019a, 2019b). Additionally, this reduces the likelihood of the archaic “spray and pray” from occurring,
as consumers will be able to specifically avoid advertisements that they do not wish
to see. Although new means of collecting data are quickly developing, it should be
noted that laws surrounding data collection may become more stringent in the
coming years, as they do not encompass all aspects of personal data. For example,
the GDPR fails to include a number of ethical and privacy-related issues, including
the collection of consumer data in order to determine their emotional state (Furey &
Blue, 2018). Marketers must be aware of any and all changes to laws regulating data
collection in order to maintain compliance.
Data storage and processing will also change rapidly, as marketers can no longer
complacently store identifiable consumer data. Two options for storing data that
some data privacy laws have put forward include anonymization and
pseudonymization. Anonymized data includes sets of attributes of a consumer that
cannot be linked directly to an individual. Pseudonymization “replaces identifying
fields with a data record by one or more artificial identifiers” and is approved by such
stringent regulations as the GDPR (European Data Protection Supervisor, 2018).
Although these types of data storage options may lead to a fragmented data set, it can
indeed still be processed to provide interesting consumer insights. Indeed,
individual-level heterogeneity can still be culled from the raw data, resulting in
new insights into consumer behavior (Kakatkar & Spann, 2019). However, marketers should proceed with caution when storing any type of data, either anonymized
or pseudonymized. Particularly for anonymization, current methods of engaging in
this scrambling of data may still be inadequate, as prior research has shown that with
the plethora of data available to marketers, it may be significantly easier to pinpoint
the correlation between data and consumer (Kolata, 2019). One recommendation to
store and process data is to control access to the data set; another is to use secure
multiparty computation.
Finally, marketers face a new challenge in customer relationships when specifically complying with the GDPR: complete termination of all data, should a consumer wish to pull their information. Although this may seem like a daunting task,
particularly due to the fact that it costs more to acquire a new customer than to
continue a current relationship, marketers should see this notion of terminating a
customer relationship, or “forgetting” said customer, in a new light: as an “emancipatory process that will free pervasive computing from burdensome and pernicious
disciplinary efforts” (Dodge & Kitchin, 2007; Politou et al., 2018, p. 12). Indeed, the
inability to forget some information regarding a consumer’s behavior may inadvertently hinder the customer relationship (Jeffries, 2011). This includes customers
monitoring their behavior online, for fear of the data-driven repercussions.
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Interestingly, current rules and regulations do not dictate a specific technique for
terminating a customer relationship, allowing marketers a bit of wiggle room for the
time being. Some recommendations for actively managing these customer relationships include using a privacy agent, attaching an expiration date to data, engaging in
data degradation, or using block chain technology (Politou et al., 2018). A privacy
agent acts as a software surrogate for the consumer, managing the data on their
behalf. This allows consumers to actively manage their data from the start, making
changing preferences and ending the relationship easier for both sides. Another way
to forget consumer data is through expiration dates on information (MayerSchoenberger, 2009). This expiration date can be negotiated with consumers, who
should be involved in all processes concerning their data. Another option is the idea
of “data degradation,” in which data can become desensitized through numerous
degradation processes (Politou et al., 2018). This is based on the premise that
marketers may still be able to engage in advertising initiatives even if the data is
older, which is information that is generally less sensitive. This limited retention
period and the degradation of information do have their drawbacks, however, as they
cannot combat the age-old option of copying data and storing it elsewhere. Yet
another option would be the use of the blockchain concept (Zyskind et al., 2015;
Politou et al., 2018). This would allow customers to be in complete control of their
personal data, with companies relieved of their duties to protect it or delete it once
the relationship is over. This may be the ideal way for companies to engage with
consumer data in the future, as the “decentralized platform makes legal and regulatory decisions about collecting, storing and sharing sensitive data much simpler
because it is possible that laws and regulations are programmed into the blockchain
itself, so that they are enforced automatically” (Politou et al., 2018, p. 18). Marketers
have many options for terminating customer relationships, and it is presumed that
many more will evolve in the coming years.
15.4
Conclusion and Future Outlook
For some three decades, academics have conducted research exploring the topic of
data privacy. In an early attempt to increase marketers’ understanding of privacy
issues, Nowak and Phelps (1992) examined how well consumers are informed with
respect to information gathering and practices. The extent to which the media
covered consumer privacy issues was addressed by Phelps et al. (1994) in order to
determine whether media salience of the issue led to public salience of the issue. At
the turn of the century, an entire issue of the Journal of Public Policy and Marketing
was devoted to privacy and ethical issues in database/interactive marketing and
public policy (Milne, 2000). In that issue, Phelps et al. (2000) explored how
consumers’ willingness to provide marketers with personal data varied by information type. Milne (2000) focused on consumers’ awareness of name removal mechanisms, such as opt-in and opt-out alternatives. Karson (2002) attempted to validate
a scale of consumer privacy and security concerns on the Internet. A large number of
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investigations have focused on cross-cultural differences with regard to data privacy.
Bellman et al. (2004), using a sample of Internet users from 38 countries, examined
possible explanations for differences in Internet privacy concerns revealed by
national regulation. Mahrous (2011) gathered data from Internet users in Egypt,
the UK, and the USA.to determine how different levels of privacy concerns
influenced actual purchase behavior. The influence of the content of online privacy
statements on consumer trust was surveyed using Russian and Taiwanese subjects
(Wu et al., 2012). Chen et al. (2013) focused on privacy issues among mobile phone
users in the USA and Korea. And, Markos et al. (2017), using a cross-national
survey of US and Brazilian consumers, developed a comparative study on information sensitivity and willingness to provide continua. An important contribution is
that of Martin and Murphy (2017), who outlined the state or privacy scholarship in
marketing and related disciplines, grouping theoretical perspectives and empirical
findings about data and information privacy according to privacy’s role in society,
the psychology of privacy, and the economics of privacy. The authors suggest that
our view of data privacy should not be constrained by consumer, organizational,
ethical, or legal silos and propose expanding beyond these borders. In summary,
consumer data and analytics are utilized and advanced by marketing practitioners at
a rate that outpaces academic scholarship (Martin & Murphy, 2017).
As a result of the changes in the regulatory environment, it is more important than
ever to study consumer privacy. Going forward, it will be important to focus on
finding the right balance between effective targeting, which benefits businesses, and
to some extent consumers as well, as they can get exposed to wanted as opposed to
unwanted messages via better targeting. Both the potential benefits and the societal
costs of privacy breaches should be factored into the equation.
This new frontier of data privacy, littered with a plethora of national and
international regulations, is an area all marketers conducting business online will
be confronted with. In the coming years, as the fallout from these regulations
becomes known, researchers will have the opportunity to explore the laws themselves, consumers’ reactions, as well as marketers’ responses. In particular, research
on consumer attitudes toward their data and specific privacy practices is needed. As
policies become enacted, and consumers become ever more aware of their data
privacy, marketers must develop a better understanding of consumers’ attitudes
toward both personal information and the laws that are there to protect it. Crosscultural studies are needed to develop a richer understanding of country-based
differences of data and data privacy. Additionally, there is a gap in the research
regarding the effectiveness of corporations and industry trade associations taking on
measures that attempt to balance consumer targeting with the protection of their data.
The targeting vs. data protection debate is yet to be settled and can only be further
complicated through its industry-dependent nature. Moving forward, it is particularly important for academic research to weigh in on the effectiveness of regulations
in meeting their stated goals. The fallout effects of the current regulations are on the
horizon and are an interesting area of future research. However, research conducted
in the field of marketing will only become more challenging (Cuzzocrea, 2014).
Although mining data from such social networking sites as Facebook and Instagram
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283
produces reliable insights, it will become more difficult to obtain as additional
security measures may be put in place to align with upcoming regulatory requirements. When it comes to outsourced databases, problematic security issues may
quickly arise, as “query processing procedures may easily access sensitive data sets
and determine privacy breaches” (Cuzzocrea, 2014, p. 46). This is further complicated through the processing of any big data set, as analytics may quickly expose
underlying consumer knowledge, so that the privacy of the consumer data is not
preserved. Researchers will not have an easy time accessing information that will
help them conduct studies on the data privacy frontier, as they themselves will have
to deal with the implications of data privacy laws.
15.5
Exercise and Reflexive Questions
1. Develop a plan for effectively targeting European consumers with digital ads
under the General Data Privacy Regulation from the perspective of a company
outside the European Union.
2. Describe how you might better target consumers over the Internet via social
media advertising while they are travelling on vacations under current privacy
regulations.
3. Outline what you believe sensible privacy regulation would be for the USA as a
whole given its history as an “opt-out” culture amidst growing concerns about
privacy.
4. Since the writing of this chapter, which other countries (advanced or emerging)
have passed laws to protect consumer data?
5. What are some additional repercussions of losing consumer trust due to data
privacy issues?
6. What are the advantages of opt-in vs. opt-out systems of consumer consent?
7. Using the content-based advertising technique for your company or university,
which pages would you target on web or social media sites?
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economist. https://www.economist.com/leaders/2017/05/06/the-worlds-most-valuableresource-is-no-longer-oil-but-data.
Urban, T., Tatang, D., Degeling, M., Holz, T., & Pohlmann, N. (2019). A study on subject data
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Walker, K., & Moran, N. (2019). Consumer information for data-driven decision making: Teaching
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doi.org/10.1016/j.chb.2011.12.008
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protect personal data (pp. 180–184). IEEE, Security and Privacy Workshops.
Sophia Mueller is a Ph.D. student in the Department of Advertising in the College of Journalism and Communication at the
University of Florida. She previously completed her Master of
Business Administration at San Diego State University. Her
research on cross-cultural differences in international advertising
and marketing practices has been presented at conferences
globally.
Charles R. Taylor is the John A. Murphy Professor of Marketing at the Villanova University of Business and Senior Research
Fellow at the Center for Marketing and Consumer Insights. He
currently serves as Editor in Chief of the International Journal of
Advertising. Professor Taylor is a Past-President of the President
of the American Academy of Advertising. He is the recipient of
the Ivan L. Preston Award for Outstanding Lifetime Contribution
to Advertising Research from the American Academy of Advertising and the Flemming Hansen Award for Outstanding Contribution to Advertising from the European Advertising Academy.
Professor Taylor is frequently quoted in the media and contributes
a column to Forbes.com.
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Barbara Mueller is a Professor of Advertising at San Diego
State University. She has published more than 60 book chapters
and journal articles. Her scholarship has appeared in the International Journal of Advertising, the Journal of Advertising, the
Journal of Advertising Research, the Journal of International
Marketing, and the Journal of Promotion Management, and she
serves on two editorial review boards. Additionally, she is the
author of Dynamics of International Advertising: Theoretical and
Practical Perspectives (Peter Lang, 3rd Edition, 2017, as well as
two additional textbooks. She has taught courses in international
advertising and international consumer behavior in Austria, Malta,
and Finland and lectured in Germany and the Ukraine.
Chapter 16
Sensemaking as a Change Agent Toward
CSR Strategy in the Media
Anke Trommershausen
Abstract Corporate social responsibility (CSR) strategy in the media has been
researched for almost three decades. Many studies and publications look at inventories of CSR strategies, motivations, or detailed measures of such endeavors. This
conceptual chapter asks how change toward CSR strategy can effectively take place
in organizations and why sensemaking processes play a crucial role in it. In this
perspective CSR strategy is conceptualized as an ongoing process of sensemaking,
affecting all stakeholders. These processes can be analyzed best through action
research.
16.1
Introduction
This chapter will contribute a conceptual framework for researching and understanding CSR in the media as an outcome of sensemaking processes, serving as change
agents toward CSR strategy. This understanding and conceptual framework stands
out, because it offers the opportunity for media organizations to reach a higher
differentiation in their CSR strategy. Instead of asking how (which topics, stakes,
instruments, etc.) and to what extent media organizations show engagement in
responsible management and strategy, the introduced conception allows us to ask
why and how decisions were made in the process of forging such a strategy. The
benefit of this research route lies in the in-depth research of managerial sensemaking
processes within media organizations in the context of Process Organization Studies
(PROS), where change is not approached from the perspective of stability, but from
the perspective of continuously ongoing change as the new normal. After a short
overview of research on CSR in the media and its conceptual basis (2.1), the
disruptive environment of the media will be described (2.2) and the emerging need
to understand CSR as a sensemaking process and change agent (3.) are illustrated.
This is realized through the introduction to PROS, as well as to the understanding of
A. Trommershausen (*)
Hochschule Magdeburg-Stendal, Magdeburg, Germany
e-mail: anke.trommershausen@h2.de
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_16
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change as a process and sensemaking as a process to finally conceptualize CSR and
CSR strategy as emergent outcomes of the named processes (4.).
16.2
16.2.1
CSR Strategy in the Media: Short Overview
and Perspectives Beyond
Research on CSR Strategy in the Media
So far, there has been a moderate amount of research on CSR strategy in the media.
Nonetheless, one can observe a growing relevance and rising interest in this research
topic (also see Koinig et al. in this volume). Looking at CSR from a managerial and
strategic point of view in case of the media, among the many definitions available
(e.g., Trommershausen, 2013), the strategic approach by Porter (2006) is beneficial.
There, the social impact (besides economic and ecological) media organizations
have is crucial. That is why all CSR endeavors should be aligned closely with the
core business in order to turn into “[. . .] a source of opportunity, innovation, and
competitive advantage” (Porter, 2006, p. 80) (also Trommershausen, 2017). Referring to a stakeholder approach to CSR, a four-part definition includes “[. . .] that a
corporation has not only economic and legal obligations, but ethical and discretionary (philanthropic) responsibilities as well” (Buchholtz & Carroll, 2012, p. 33). This
means in the specific case of the media: issues in journalistic as well as business
ethics.
Beginning in the early years of the new millennium and still continuing today,
there has been research on how (which topics, stakes, instruments, etc.) and to what
extent media organizations show engagement in responsible management and strategy (Altmeppen, 2011; Karmasin & Bichler, 2017; Trommershausen, 2011;
Trommershausen & Karmasin, 2015). This research is growing more relevant and
is becoming more pressing for the media industry for several reasons. First, the
media industry has been and is being challenged by digitization on the level of the
whole industry, on the strategic/organizational level as well as with regard to
management issues (Wirtz, 2019) (Küng, 2018) (Trommershausen & Richter,
2016) (Trommershausen, 2013; also see Voci & Karmasin in this volume). Loss
of trust, new global competitors in the media business, the challenge of big data
technologies and privacy (Olkkonen, 2015), and many more obstacles (Zerdick
et al., 2005) are putting media organizations under pressure. In order to succeed in
this context of new challenges, media organizations need to strive for differentiation
by returning to and reinforcing their core values and competencies
(Trommershausen, 2017). Implementing a value-oriented (Altmeppen et al., 2017)
and sustainable strategy (and management) (Trommershausen & Karmasin, 2015)
can help to create such differentiation. Second, “[. . .] media companies in Europe
don’t yet fully communicate their CSR efforts, and their internal CSR instruments
have not even reached all of their employees” (Karmasin & Bichler, 2017, p. 143).
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This means, even though the competitive environment of media organizations is
changing rapidly, internal processes of change toward a CSR strategy are still poorly
developed in the industry (at least across Europe). At the same time demands by
stakeholders are rising (Olkkonen, 2015) (Schrempf, 2012), especially toward quality media outlets. Their (dual) role of being responsible for the content they serve as
well as for the business they run turns them into special actors in the information
industry, serving a complex set of stakeholders (Karmasin, 2002). “The increasing
complexity around media organizations is a typical reason for intensifying expectations of accountability and responsibility: when the power of corporations increases,
expectations are heightened to balance the influence and control” (e.g., Banerjee,
2008 in Olkkonen, 2018, p. 170; also see Porlezza & Eberwein in this volume). This
fosters the argument that there is a major process of change going on, when focusing
on your core business (Trommershausen, 2017) and integrating journalistic and
business ethics, by performing a “twin responsibility” (Altmeppen, 2011, p. 247)
or a special “media responsibility” (Karmasin & Bichler, 2017; Koinig et al., 2019;
see Koinig et al. in this volume).
A common ground of the present research is that the media industry and its
organizations (with journalism as a specific institution) (Altmeppen, 2006) are a
special industry, because of its “dual responsibilities.” Olkkonen introduces, based
on the separation argument (democratic and journalistic ideals are separated from
commercial goals (originating from Commission Freedom of the Press, 1947 in
Peterson 1956)) a sector-based corporate responsibility, as a comprehensive combination of journalistic and business responsibilities.1 Further, a common ground and
distinction in studies and publications on CSR in the media is a differentiation
between performed CSR measures (Gulyás, 2011; Trommershausen, 2011;
Karmasin & Bichler, 2017) and the public communication (management) about
these measures (Grayson, 2009), especially on how this communication is perceived
by relevant stakeholders (Olkkonen, 2015; Bracker, 2017; Ingenhoff & Koelling,
2012). The latter already offers insight into “how” media organizations “talk” about
their responsibility engagements and can give hints on how the integration of
journalistic and business ethics might take place within organizations. This also
gives insight into certain typologies of CSR strategies, such as “dual thinkers,”
“semi-integrative actors,” and “integrative forerunners” (Olkkonen, 2018, p. 182)
in the media industry (see Sect. 16.3.4.1). Also, different competitive strategies can
be identified, such as differentiation or focus strategies (Porter, 1980), also
researched in the media industry (e.g., Trommershausen, 2011; Trommershausen
& Karmasin, 2015). Strategy here is conceptualized as the outcome of linear
processes of strategic phases, turning into such classifications. With the very volatile
and disruptive environment of the media industry in mind, such strategies are often
too static and might be oriented backward, when in former times the organization, its
environment, and strategies lasted over a longer time (Hardy et al., 2016, p. 1229).
1
This duality has been enlarged by a corporate communicative responsibility (a third dimension),
introduced by Weder and Karmasin (2011).
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That is why this chapter will have a constructivist lens (see Sect. 16.3) on CSR as a
sensemaking process where strategy is understood as an emergent strategy
(Mintzberg, 1987).
16.2.2
A Look Beyond: CSR in the VUCA World
As pointed out earlier, the media industry is finding itself in a tremendous time of
change, in disruptive times, initiated by processes of convergence (Wirtz, 2019) and
now entering the economy 4.0 with all its consequences (Rifkin, 2014), which brings
up media-specific challenges across all industries. Strategies and managerial processes are created and conducted in a world that is characterized by volatility,
uncertainty, complexity, and ambiguity (VUCA) (Mack et al., 2015). It will be
pointed out later that these characteristics are the reasons why change needs to be
understood as an ongoing process (Sect. 16.3.2). That is why, with regard to CSR
strategy in the media, there is an overemphasis on the research of the content of CSR
activities (Olkkonen, 2018, p. 182). Because of this overemphasis, Basu and Palazzo
(2008) identify the need for an approach to CSR as a sensemaking process as
follows: Their main critique is that many studies are “analyzing CSR by examining
CSR” (ibid., p. 124) which has led to a tremendous number of very descriptive
studies, which simply line up inventories of CSR activities. With such research the
aim of differentiation turns into homogeneity. “[. . .] simply documenting
CSR-related activities without understanding their precipitating causes is
unlikely to reveal real differences among firms, given the trend of rising homogeneity and near standardization in CSR reporting” (ibid.; emphasis added by
author). Strategically, there should be a higher interest in using possibilities for
differentiation, especially in a VUCA world.
Besides the questions of how and to which extent media organizations engage in
responsibility measures, the question why and how were decisions made on such
measures (strategically) needs to move into the center of research on media business
and management. “Thus, rather than analyzing CSR by focusing largely on the
content of CSR activities, the process view argues for a deeper examination of
organizational character [. . .]” (Basu & Palazzo, 2008, p. 124). This character
needs to be matched with stakeholder demands and desires toward media organizations, initiating—in a stakeholder view (Karmasin, 2002)—an understanding of
social connection (Schrempf, 2012) that can help to make sense (together) of a
comprehensive CSR strategy for media organizations. In times of rising participation
and interaction of and with stakeholders, the process view of sensemaking appears to
be an adequate approach and understanding of how CSR processes are initiated and
how they enhance the differentiation of CSR engagements of individual media
organizations. This chapter won’t create a road map for analyzing CSR as strategic
outcomes, but focuses on a road map for theory innovation and research options, in
which CSR is understood as an ongoing process of sensemaking, serving as a change
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Fig. 16.1 CSR: Dimensions of the sensemaking process (Basu & Palazzo, 2008, p. 125)
agent within organizations. In this perspective sensemaking is conceptualized as a
change agent toward (a differentiating) CSR strategy in the media (see Fig. 16.1).
16.3 CSR as a Sensemaking Process and Change Agent
16.3.1 Process Organization Studies
The understanding of organizations in research can roughly be separated into
variance and process theories (Langley & Tsoukas, 2010). The first direction
understands organizations as stable entities, as phenomena that exist because of
the interrelationship of dependent and independent variables. The latter understands
organizations as ongoing processes, as temporarily stable patterns of events, activities, and choices over time (ibid.)
In the latter tradition of epistemological theories, Process Organization Studies
(PROS) are based on a concept that understands organizations as constantly changing processes (Hernes, 2008; Hernes & Maitlis, 2012; Langley, 2007; Langley &
Tsoukas, 2010; Maitlis, 2005; Tsoukas & Chia, 2002). While in variance theories
“the” organization is understood as trying to reach a constant and stable state (in the
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end), the constructivist/process approach of organizations (Hernes, 2008; Langley &
Tsoukas, 2010) is more radical. In this approach, organizations are forever in the
making (Hernes, 2008), which is the reality of many media organizations today
(Küng, 2018). They find themselves in a state of constant change instead of finding
themselves in between change processes pretending to reach some state of stability
(Lewin, 1947) (see Sect. 16.3.2). It is possible to contribute to a better understanding
of how CSR strategy develops in the media industry on the grounds of process
studies, because the context and environment of this industry is characterized by a
VUCA world (Mack et al., 2015). This world symbolizes the direct opposite
of stable entities and structures (e.g., Hernes, 2008; Hernes & Maitlis, 2012). Instead
of understanding media organizations as well structured and in constant stages of
non-change, media organizations can be seen as “[. . .] in perpetual motion, as
continually in the process of becoming [. . .]” (Langley & Tsoukas, 2010, p. 1).
Change is prioritized over persistence. Epistemologically, process metaphysics is a
core element in the foundation of this understanding (Hernes & Maitlis, 2010, pp. 2).
This idea corresponds to Weick’s understanding of organizing (1969, 1995) instead
of the word organization (Karl E. Weick, 1979, 1995). Media organizations, especially challenged by convergence and digitalization, are growing into fast changing
“entities,” in the process of constant organizing.
Process metaphysics, as opposed to substance metaphysics, applies to media
organizations in a very compelling way. Instead of perceiving certain processes as
happening to the media organization, the organization is emerging out of and
reacting to these processes. In the case of transformations of the media, this new
phenomenon does not “happen” to the media organization, but the processes themselves (such as sensemaking) are making or forming an emergent structure of the
media organization today.2 Overall, this means that specific processes do contribute
to what media organizations are. “Process metaphysics regards change as endemic,
indeed constitutive of the world. Every event reconfigures an already established
pattern, thus altering its character” (Hernes & Maitlis, 2010, p. 3) (emphasis added
by author).
Taking into account that today’s media organizations are changing constantly
(Achtenhagen et al., 2013; Järventie-Thesleff et al., 2014), the theoretical basis of a
CSR strategy should be based on the grounds of process theory as well. This
corresponds with a process based view on change itself.
16.3.2
Change as Process
“Change, we argue, is the reweaving of actors’ webs of beliefs and habits of action
to accommodate new experiences obtained through interactions. Insofar as this is an
2
The same is true for “strategizing” (e.g., Johnson et al., 2007) of a tailored CSR engagement of
media organizations.
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ongoing process, [. . .], change is inherent in human action, and organizations are
sites of continuously evolving human action” (Tsoukas & Chia, 2002, p. 567)
(emphasis added by author). This can be juxtaposed to the (still) widely accepted
and implemented understanding of Kurt Lewin’s model of change of “unfreezing,
transitioning and refreezing” (Lewin, 1947). Lewin’s model presupposes stability as
being a normal status and change being a temporarily, well-limited period of time
within an organization. In line with Tsoukas and Chia (2002), this chapter agrees
with the named benefits for organizations, to approach change from the perspective
of ongoing change rather than from the perspective of stability (as introduced by
Lewin, 1947; ibid., p. 568). These benefits could be:
• The focus of research could move to the micro-processes of change and focus on
the why and how these processes are performed. (This could create higher
differentiation.)
• Instead of analyzing ex-post which change has been accomplished, one could
research how single actors added up through their (micro) actions to this process.
(Thus, these actions become manageable.)
• Change programs that are informed by the view of stability rather than of ongoing
change often do not produce change. They fail. (This could be a motivation to
approach change toward CSR strategy in a new manner.)
Overall, this is an understanding of a performative concept of change, combined
with the analysis of patterns and synoptic approaches of already established patterns,
rules, etc. In combination, the three named benefits could also benefit CSR strategies
in the media, when understood as a sensemaking process and agent for change. It is
presupposed that a constructivist, performative, and discursive (Schoeneborn et al.,
2019) understanding of CSR needs to be the starting point. “However, seen from the
perspective of ongoing change, the introduction of a new discursive template is only
the beginning of the journey of change or, to be more precise, it is a punctuation of
the flow of organizational life” (Tsoukas & Chia, 2002, p. 579). Such discursive
templates are very common, especially in the often arising tensions between different roles of managers and journalists.
Close to such an understanding of change—which might benefit CSR strategy in
the media—is that of Van de Ven and Poole (2005). They distinguish four
approaches of studying change using the categories of ontology and epistemology.
This chapter will only juxtapose Approach I and III of their paper, since these can be
seen as antipodes for categorizing CSR research in the media so far.
Approach I symbolizes variance studies of change in organizational entities by
causal analysis of independent variables that explain change in the entity (dependent
variable). This approach refers to a stable unit, an object (thing) of analysis. This
Approach (I) “[. . .] makes it difficult to study important questions of how the change
comes about” (Van de Ven & Poole, 2005, p. 22). Many studies of CSR in the media
can be associated with such a research understanding.
This chapter agrees mostly with Approach III, because the process of
sensemaking (in CSR strategy) can be considered best: “Process studies of organizing by narrating emergent actions and activities by which collective endeavors
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unfold” (Van de Ven & Poole, 2005, p. 48). This approach is so promising, because
it is able to answer questions that can benefit differentiation strategies of organizations. That is, because “[i]t examines questions like how do processes of
sensemaking, conflict resolution, protests, or making a living unfold over time?”
(ibid., p. 24) (emphasis added by author). The authors state that many publications
deriving from this approach are conceptual in nature (Trommershausen, 2014;
Tsoukas & Chia, 2002; Tsoukas & Chia, 2002), and only very few are empirical
studies (e.g., in science studies; actor network theory) (Trommershausen & Richter,
2016).3 Also, Weick describes changes as “chronically unfrozen systems” (Weick,
1977). Nonetheless, there are stabilizations like rules, patterns, etc. To find stability
(especially over time) in such processes, calendars, regular meetings, sprints, informal practices, etc. can be seen as prototypical for such stabilizations.
Overall this means, when understanding change in the context of process studies,
this change might lead to a (temporal) new point in the overall process of change.
But when thinking of CSR of media organizations in a VUCA world, this kind of
CSR strategy is an ongoing change process with regard to ever new challenges: on
the industry, the organizational, and on the managerial level (Hardy et al., 2016,
p. 1229).
In the same vein and congruent with Van de Ven and Poole (2005) is the idea of
change as presented by Orlikowski and Hofmann (1997). Instead of differentiating a
phasic model of “unfreezing, transitioning and refreezing,” they state a “discrepancy
between how people think about [. . .] change and how they implement it”
(Orlikowski & Hofmann, 1997, p. 11). Lewin’s model (1947), for sure, would be
an example for how people “talk” about change. But what is change at the level of
processual implementation in the everyday routines within organizations? “Today,
however, given more turbulent, flexible, and uncertain organizational and environmental conditions, such a model is becoming less appropriate—hence, the discrepancy” (Orlikowski & Hofmann, 1997, p. 12). That is why they introduce an iterative
process of change that is open to unprecedented events. This way, organizations are
constantly reacting to the process of change itself and incidents that might not be
predictable in this process of change can be taken into account. “Such a model sees
change management more as an ongoing improvisation than a staged event” (ibid.).
This approach—congruent with Mintzberg’s deliberate and emergent strategies
(Mintzberg, 1987)—differentiates anticipated, emergent, and opportunity-based
change.
• Anticipated Changes: changes that are planned ahead of time and occur as
intended.
• Emergent Changes: changes that arise spontaneously from local innovation and
that are not originally anticipated or intended.
Such endeavors are characterized by “[a] double irony [. . .]: that a processual world should be
studied only through processual methods, since those methods are filtered through static representations of the process” (Van de Ven & Poole, 2005, p. 25).
3
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• Opportunity-Based Changes: changes that are not anticipated ahead of time but
are introduced purposefully and intentionally during the change process in
response to an unexpected opportunity, event, or breakdown (Orlikowski &
Hofmann, 1997).4
While the first category of change is congruent with variance theories and linear
planning (Lewin, 1947), the second and the third categories of change go congruent
with process ontology and epistemology as outlined earlier. In this same vein, one
can locate the process of sensemaking, understood as emergent and opportunitybased change. This will be explained in Sect. 16.3.4, where changes in the environment as well as within the organization are relevant for CSR sensemaking. “[. . .]
while sensemaking is about change, it is not about the step-wise type of change
suggested by Lewin’s model ‘unfreeze—change—refreeze,’ which is effectively to
see change as a series of immobilities”(Hernes & Maitlis, 2010, p. 28). That is why
sensemaking needs to be seen as an ongoing process of change and—in this
chapter—as a change agent toward CSR strategy.
16.3.3
Sensemaking as Process
The continuous process of creating meaning in organizations can be described as
sensemaking5 (K. Weick et al., 2005, p. 411; Karl E. Weick, 1995). Sensemaking
always occurs when the current flow of experience of the actors is disturbed by
unexpected events and developments. These will be identified with reference to past
experiences and future expectations and will be named in order to understand them.
With regard to the growing challenges of media organizations in a VUCA world,
sensemaking is an ongoing process to generate sense of this fast changing world.
“Explicit efforts at sensemaking tend to occur when the current state of the world is
perceived to be different from the expected state of the world, or when there is no
obvious way to engage the world” (K. Weick et al., 2005, p. 409). In this way,
sensemaking can be conceptualized as the process of negotiating a temporarily stable
consensus of intersubjective attributions of meaning to reduce ambiguity in the
environment (Weick, 1995). The generation of sense is often connected to specific
systems of symbols (e.g.. values and norms, rituals or culture) and artifacts (e.g.,
used tools for communication, software, etc.) (ibid., pp. 67). These symbols and
4
This differentiation derives from an empirical study by Orlikowski and Hofmann of the implementation of new technology in an organization (1997).
5
Sensemaking is characterized by seven characteristics: It is (1.) closely related to the identity
construction of the actors involved; (2.) it is a retrospective process, sense follows action; (3.) it is
connected to the mutual influence between the environment and the actors; (4.) it is a social, more
individual, and collective process; (5.) it is an ongoing process; (6.) it is based on information that
serves as a reference frame; and (7.) it is not guided by accuracy, but by plausibility (Karl E. Weick,
1995).
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A. Trommershausen
Fig. 16.2 Enactment, organizing, and sensemaking in organizations (Jennings & Greenwood,
2003, p. 202)
artifacts often guide the thinking and acting of individual and collective actors in
organizations. Crucial in this process is the use of language. Language is key for the
intersubjective attributions of sense (ibid., pp. 106). Connected to the process of
sensemaking, or rather being a crucial part in it, is the process of enactment. It can be
described as follows: Actors “[. . .] undertake undefined space, time and action, and
draw lines, establish categories, and coin new labels that create new features of the
environment that did not exist before” (Weick, 1995). It refers to a model by Weick
(1979), which connects organizing, enactment, and sensemaking within the organization (Jennings & Greenwood, 2003, p. 202):
When conceptualizing CSR as a sensemaking process, Fig. 16.2 can be seen as a
fundamental basis. By referring to important studies which are based on this
understanding of sensemaking, a conceptual framework will be developed for
sensemaking as a change agent toward a CSR strategy.
16.3.4
CSR as a Sensemaking Process
Most of the sensemaking literature focuses less on the actors of sensemaking, but
rather on the events and incidents of sensemaking (Hernes & Maitlis, 2010, p. 29).
Nonetheless, often (middle) managers are responsible for the conduct of
sensemaking processes and the creation of CSR strategy. They act as change agents.
Because this chapter will focus on the processes of sensemaking toward CSR in
the media, there needs to be a differentiation between different levels of and within
organizations where change is taking place and how this relates to (CSR) strategy
(3.4.1). Further, this section will focus on studies which research the managerial
sensemaking processes (3.4.2). Afterward, the sensemaking approach to CSR by
Basu and Palazzo (2008) will be explained, finalizing the conceptual framework for
researching change as an ongoing sensemaking process toward CSR.
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Sensemaking as a Change Agent Toward CSR Strategy in the Media
16.3.4.1
299
Media Organizations and Levels of CSR (Strategy)
The media organization is not existent anymore. Definitions of what media organizations are, which ones are actually part of the (formerly called) mass media, and
how to differentiate those that are part of the whole TIME industry and the platform
industry (social, trade, business, etc.) are a difficult project in itself. This paper
argues mostly with traditional legacy media in mind, which used to be part of the
traditional mass media and are now merging with online and social media platforms.
The whole industry is becoming more commercialized (Altmeppen et al., 2017,
p. 2). This, on the other hand, makes questions of a value-oriented management
(ibid.) more pressing. Even more so, because media organizations face a dual
responsibility, as outlined earlier (e.g., Altmeppen, 2011; Karmasin et al., 2014;
Koinig et al., 2019). Media organizations are responsible for the content they
produce and its impact on society, as well as for the business they run. In this
sense “[c]orporate responsibility, especially when understood as sector-based corporate responsibility, is a comprehensive view of the responsibilities of media
companies as a combination of journalistic and business responsibilities”
(Olkkonen, 2018, p. 170, 174). This becomes even more pressing, because the
“[. . .] increasing complexity around media organizations is a typical reason for
intensifying expectations of accountability and responsibility: when the power of
corporations increases, expectations are heightened to balance the influence and
control” (e.g., Banerjee, 2008 in Olkkonen, 2018).
Olkkonen (2018) distinguishes three types of media organizations with regard to
their manner of linking journalistic and business ethics. Integrative forerunners,
semi-integrative actors, and the dual thinkers are the results of her empirical study.
These results show that sensemaking processes are taking place in very different
ways. Emerging out of these processes, one can identify different strategies on the
corporate level. The integrative forerunners, for example, discuss journalism ethics
and business ethics jointly. They correspond most closely to the dual responsibility
with regard to the special impact of media. These media organizations “[. . .]
recognize[. . .] the impact of its products in the daily lives of millions of people
and, therefore, highlighted the importance of producing high-quality content that
helps consumers develop themselves and experience enjoyment” (ibid., p. 180). The
semi-integrative actors have a more holistic view of their responsibility, with
economic, social, and environmental issues, and are aware of their impact on society.
The dual thinkers, finally, show that they hardly connect their journalism and
business responsibilities. Economic and environmental issues seem to be completely
separated from the social impact of their journalistic work.
Overall, when discussing sensemaking as a change agent toward CSR strategy,
one needs to differentiate the following levels and actors in an organization.
16.3.4.2
Managers as Change Agents Toward CSR
Often (middle) managers are responsible for the attribution of sensemaking processes and the creation of CSR strategy. They act as change agents (also see Koinig
et al. in this volume).
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A. Trommershausen
There are already studies in place, which conduct research on change as a
sensemaking process, proving, that “[. . .] change becomes a constant in organizational life, middle managers charged with interpreting, communication and
implementing change often struggle for meaning” (Lüscher & Lewis, 2008,
p. 221). Lüscher and Lewis (2008) analyze how managers serve as critical change
agents in order to reach a “workable certainty” (ibid.) within change processes.
Overall, studies on sensemaking and change are rare, because of research challenges.
This refers especially to the challenge of looking in depth at how managers make
sense of contexts that are characterized by complexity, ambiguity, and equivocality
(Hatch & Ehrlich, 1993). In order to dive deep into the research topic, action research
needs to be conducted, to really analyze in depth the sensemaking processes. In the
study of Lüscher and Lewis (2008), they conceptualize sensemaking as a process of
working through a paradox (ibid, p. 227). This process is very suited for the process
of change toward CSR, since it starts with a problem, which in most cases is a crisis
situation of companies, facing ethical problems or accusations of unethical business
conduct. This problem needs to be explained to all employees (very often by middle
managers) which often develops into a dilemma, because “[. . .] many managers feel
incapable of solving this problem. Dilemma creates paralysis, or ‘stuckness’,
because it implies that a choice must be made between polarities each having high
costs as well as valued benefits” (ibid). Awareness of dilemma and working through
a paradox turned out to be key in the change process of the researched company by
Lüscher and Lewis. The goal was, finally, to reach a “workable certainty,” which
“[. . .] signifies that people can never fully grasp intricate situations. Rather they are
always in the process of sensemaking” (ibid, p. 230). Overall, this study shows that
sensemaking is at the heart of change. When organizations are trying to implement a
CSR strategy, problem, dilemma, and paradox are key in organizational change, in
order to give middle managers and their subordinates enough space to make sense of
this ongoing change.
In the same vein, studies can be named that research the language and rhetoric of
managers who are trying to make sense toward CSR (e.g., Carollo & Guerci, 2017;
Schoeneborn et al., 2019). Here, discourse can be seen as a strategic resource
(Hardy et al., 2016). With Hardy et al. (2016) discourse is understood in the tradition
of critical discourse theorists as follows: they are “[. . .]sets of texts — statements,
practices, etc. — which bring an object into being. Thus discursive analysis requires
an examination of language, the production of texts and processes of communication, and the interactions between actors in organizational and institutional settings
(Grant et al., 1998)” (cited in Hardy et al., 2016, p. 9). Discourses as a strategic
resource are also relevant for change processes toward CSR, when trying to make
sense of these changes. Sensemaking is such a promising strategic route to choose,
because “although CSR takes place at the organizational level of analysis, individual
actors are those who actually strategize, make decisions, and execute CSR initiatives” (Carollo & Guerci, 2017, p. 632). The authors analyzed the occupational
rhetorics of CSR managers in order to find out how they fit their work into a (new)
meaning system (ibid., p. 634). Haack et al. (2012) describe the implantation of CSR
at the organizational level as a result of a narrative struggle in which employees
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301
Fig. 16.3 Levels of sensemaking and emerging CSR strategy (own diagram)
working in the CSR department play the part of “protagonists” (see Haack et al.,
2012 in Carollo & Guerci, 2017, p. 635). As a result, Carollo and Guerci (2017) state
that “Evidently, CSR manager’s occupational rhetorics meet their need to find
legitimacy for their work and therefore advance CSR’s influence and position inside
business organisations” (ibid, p. 634). Language, rhetorics, and discourse seem to be
a major resource when forging a differentiating CSR strategy.
Hardy et al. (2016) focus on discourse as a strategic resource that is key in
sensemaking processes of change. The authors presuppose that “[. . .] it is possible
for individuals to engage in discursive activity and to access different discourses to
generate new meaning that help—or hinder—the enactment of particular strategies”
(ibid., p. 1228). This is congruent with the process of sensemaking as outlined above
(see Fig. 16.2: ecological change—enactment—selection—retention) and can benefit
processes of change, e.g., on the level of middle managers toward CSR. Also
important in the vein of a process epistemology is the notion that “strategy”—like
the environment and the organization—is a construction, reproduced by a variety of
texts and practices, that serves to make sense of the world (Hardy et al., 2016,
p. 1229). This refers to Fig. 16.3, where different levels support the forging of (CSR)
strategy. In the end, strategy is a form of rhetoric, of a frame, that gives sense (back)
to activities and occurrences. It is an iterative, constructivist process of sensemaking.
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A. Trommershausen
With regard to such processes as discursive procedures, one needs to examine the
“language, the production of texts and processes of communication, and the interactions between actors in organizational and institutional settings” (Grant et al.,
2004). The results of analyzing how discourse is used as a strategic resource by
actors when trying to enact their strategic actions brought up three crucial steps in
doing so. Hardy et al. (2016) differentiate a circuit of activity (e.g., new discursive
statements by individuals), a circuit of performativity (e.g., new concept is embedded in discursive context and possesses receptivity), and a circuit of connectivity
(e.g., discursive statements “take” connecting relations/material and concept in a
specific situation; practices emerge) (Hardy et al., 2016, p. 1235). In Sect. 16.3.4.3
we will see that the introduced process model of sensemaking for CSR takes the
typology of sensemaking circuits put forward by Hardy et al. (2016) as a
prerequisite.
16.3.4.3
CSR as a Process Model of Sensemaking
The process model of sensemaking (Basu & Palazzo, 2008) in CSR is based on a
stakeholder approach to the organization (e.g., Karmasin, 2006). Media organizations have a specific need to include very homogeneous stakeholders into the process
of sensemaking. While the presented studies in Sect. 16.3.4.2 focus on the internal
processes of change toward CSR, the process model of sensemaking by Basu and
Palazzo (2008) focuses additionally on the intersection and interaction of the
organization with external stakeholders. So, when researching CSR in the media,
the conception presented here focuses both on how sense is generated within media
organizations (action research) and how the interaction of such sensemaking is
realized through the interaction with stakeholders (content analysis, etc.).
As mentioned before, Basu and Palazzo (2008) identify a very descriptive and
“examining” way of studies of CSR strategy, which are mainly content based. They
see this fact as a deficit, because these studies say little about motives or reasons for
decision-making processes and what differences might occur between different
companies. As explained in Sect. 16.3, the approach of sensemaking as a change
agent toward CSR might be able to solve this problem. This criticized inventory
analysis of CSR has led to the “[...], neglect of institutional factors that might trigger
or shape such activities in the first place” (Basu & Palazzo, 2008, p. 123). This deficit
is especially problematic since media organizations today are in a constant process of
change, when understood in terms of process epistemology.
That is why Basu and Palazzo (2008) are suggesting an interpretive approach to
CSR strategy: A process model of sensemaking, which is “[. . .] studying internal
institutional determinants, such as the mental frames and sensemaking processes
within which CSR is embedded (i.e. by studying how an organization makes sense
of its world)” (ibid., p. 123; emphasis added by author). This approach originates
from the work of Weick (1995), relating organizational sensemaking to seven
properties as well as different levels of sensemaking within the organization (i.e.,
intersubjective, generic subjective, and extrasubjective level) (Karl E. Weick, 1995,
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303
p. 70). Basu and Palazzo (2008) base their process model of CSR on the concept of
sensemaking, also including the idea that the meanings constructed are not the same
as reality itself. That is why CSR is understood as an outcome of cognitive and
linguistic processes (e.g., Hardy et al., 2016).
Taking this assumption into account, “these processes of sensemaking within an
organization lead the organization to view its relationships with stakeholders in
particular ways, which, in turn, influence its engagement with them” (ibid.,
p. 123). The study of the processes that guide organizational sensemaking and
influence the relationships with stakeholders offers a new way to find out how
CSR strategy is created. “Thus, we can define CSR as the process by which
managers within an organization think about and discuss relationships with stakeholders [. . .], along with their behavioral disposition with respect to the fulfillment
and achievement of these roles and relationships” (ibid., p. 124). That is why Basu
and Palazzo (2008) introduce the following set of cognitive, linguistic, and conative
dimensions to identify the kind of intrinsic orientation that guides CSR-related
activities (ibid., p. 125).
Cognitive The cognitive processes imply what the organization thinks about the
relationships with its stakeholders and its views about the broader world (Basu &
Palazzo, 2008, p. 124). This cognitive aspect includes questions on identity as well
as on the perceived need to be accepted (legitimacy).
With Brickson (2007) Basu and Palazzo (2008) argue that identity orientation
could be understood “[. . .] as a construct that consists of participants’ shared
perceptions of what their organization is, thereby driving motivation and behavior”
(ibid., p. 125). This orientation can be individualistic, relational, or collectivistic and
has an impact on what kind of relationships will be built up with stakeholders. These
three types of identity orientation describe different degrees of the interdependence
between the entities and their natures. An individualistic orientation focuses on one’s
individual liberty and self-interest as being distinct and separate from others. Organizations with a relational orientation see themselves as partners in relationships with
stakeholders, showing and communicating a strong commitment to each other. A
collectivistically oriented organization goes even further. It sees itself not only as
integrated into their stakeholder groups but also into the wider society, feeling
responsible, for example, to fight poverty in general and contribute to a sustainable
world (ibid., p. 126). Relational organizations might focus CSR actions on strengthening relationships with stakeholders, and collectivistic organizations might show
engagement in a more global topic such as social or environmental issues.
Linguistic The linguistic orientation implies that the organization says certain
things, to either reach justification or transparency. “Justification might be viewed
as reflecting how they interpret their relationships with stakeholders and view their
broader responsibilities to society” (Basu & Palazzo, 2008, p. 127). This justification
is understood as “playing” language games that appear in three different modes:
legal language games (referring to the law, codes, and compliance frameworks),
scientific language games (such as expertise in the measurement of certain impacts,
etc.), and economic language games (highlighting tangible contributions to
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stakeholders like creating jobs, paying taxes, etc.). This refers to the internal
processes of working through a paradox (Lüscher & Lewis, 2008).
Conative The conative orientation implies that the organization behaves in different
ways. This behavior can be systematically be analyzed as “posture,” “commitment,”
or “consistency.” This aspect of consistency refers to Porter and Kramer (2002),
because “[i]nherent in their view of strategic coherence is the notion of consistency
as a behavioral discipline in approaching CSR tasks” (Basu & Palazzo, 2008,
p. 129). There are two relevant aspects of consistency: the one between the organization’s overall strategy and its CSR activities and within the varieties of CSR
activities (ibid., p. 129). The consistency orientation is a major premise to achieve
good CSR performance.
The core claim is that media organizations implement CSR for strategic reasons,
meaning (with Porter & Kramer, 2002) that they orient their CSR activities close to
their core business. The core business has been understood as impacting and
influencing stakeholders in a dual sense and with a dual responsibility (3.4.1).
What the dimension of consistency means is that managers need a fundamental
understanding of the core business of the media organization and what the relevant
inside-out and outside-in linkages to CSR might be (Porter & Kramer, 2002) on the
economic and journalistic level (see Fig. 16.3).
16.4
Sensemaking as a Change Agent Towards CSR
Strategy in the Media: A Conceptual Framework
Overall, this chapter introduced a conceptual and theoretical framework on how to
research the emergence of CSR strategy in the media, in order to reach a higher
differentiation in the emerging strategy. Change is endemic in media organizations,
ongoing change as well as ongoing processes of sensemaking. As pointed out by
Van de Ven and Poole (2005) earlier, many publications deriving from the perspective of process epistemology are conceptual in nature (Trommershausen, 2014;
Tsoukas & Chia, 2002) (Tsoukas & Chia, 2002) and only very few are empirical
studies (e.g., in science studies; actor network theory) (Trommershausen & Richter,
2016). Nonetheless, this is often due to higher research efforts and expenses because
of the necessity of qualitative research methods. Action research (Denzin, 2009) as
well as appreciative inquiry (Cooperrider & Srivastva, 1987) (Trommershausen,
2019) conducted (ideally) over a long period of time make such research so
problematic and rare. Also, qualitative research is underrepresented in scientific
publications on this topic, which is a pity, because this is the most promising route
to achieve in-depth insights into sensemaking processes. Based on such insights,
answers to why and how decisions were made in the process of sensemaking could
open up the opportunity to support such practices and to make them manageable in
order to reach a higher differentiation in the CSR strategy. Overall, this chapter gave
conceptual insights into the theory and the need for qualitative methodology to
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305
understand and research sensemaking as a change agent toward CSR strategy in the
media.
16.5
Exercise and Reflexive Questions
1. What are the two reasons why CSR issues are becoming more pressing in the
media industry?
2. Why is there a need to research CSR in the media in a process and
sensemaking view?
3. What might be the three potential benefits to understand organizations from the
perspective of process theories?
4. Why is it—especially in the media industry—useful to understand change as an
ongoing process?
5. In which sense are middle managers important change agents?
6. Which three core dimensions can finally be named that play a crucial role in the
sensemaking of organizations?
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Anke Trommershausen is professor for media management at
the University of Applied Sciences Magdeburg-Stendal. Previously, she was a junior professor at the Bauhaus University Weimar (department for media management) and received her PHD in
media and communication sciences at the University of Klagenfurt. Her research areas concern challenges and changes in media
management and economy in the age of digitalization, organizational change, postmodern management, and corporate social
responsibility in media organizations, especially ethics management and media accountability. For further information, please
see
https://www.hs-magdeburg.de/hochschule/fachbereiche/
soziale-arbeit-gesundheit-und-medien/mitarbeiter/prof-dr-anketrommershausen.html.
Chapter 17
CSR as “Integrity Management”
in the Media Industry: An Investigation
of the Top Three Media Organisations from
Germany, Austria and Switzerland
Isabell Koinig, Anika Bausch, and Matthias Karmasin
Abstract In recent years, CSR has not only increased in relevance in the context of
individuals’ purchasing decisions, but it has also come to influence how businesses
operate. Combining social expectations with economic reasoning has also become
the norm in the media industry. The chapter at hand looks at how media companies
in Germany, Austria and Switzerland address CSR both in their business operations
and in their communication (i.e. as part of the quadruple bottom line). Results
indicate that CSR is not implemented as “integrity management” in the media sector
yet. We offer potential explanations for this lack of integration, before addressing
future research potentials for changing notions regarding CSR in the media industry.
17.1
Introduction
Modern society faces various challenges, such as poverty, inequality and climate
change. Among others, these challenges are addressed by the United Nation’s (UN,
2015) sustainable development goals (SDGs), which exhort the present generations to
take global action in order to ensure a decent life for future generations. In order to
realize these goals, politics, economy and society are obligated to work hand in hand
and make their contribution. Corporate social responsibility (CSR) is the expression
for the integration of such societally relevant objectives on the business level. Also,
consumers are increasingly aware of these challenges and expect companies to accept
responsibility for the negative environmental and social impacts of their business
behaviours (Cone Communications, 2017; Nielsen, 2013; Statista, 2020).
I. Koinig (*) · A. Bausch
University of Klagenfurt, Klagenfurt, Austria
e-mail: isabelle.koinig@aau.at; anika.bausch@aau.at; matthias.karmasin@aau.at
M. Karmasin
University of Klagenfurt, Klagenfurt, Austria
Austrian Academy of Sciences, Vienna, Austria
e-mail: matthias.karmasin@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_17
311
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Consequently, companies intensify their efforts to legitimize their business operations:
They implement responsible corporate actions and have started to communicate them
on their websites or in their CSR reports (KPMG, 2017). For some organisations,1 the
reporting on non-financial aspects, including CSR measures, is obligatory. In Austria,
for instance, this affects 125 companies (WKO, 2017). Nevertheless, the engagement
in sustainability and CSR is voluntary (European Commission, 2011, p. 7) and
therefore a rather idealistic ethical measure. CSR reporting is facilitated, in particular,
by trends of convergence, which allow for both fast and targeted communication. The
dialogical nature of the Internet thereby allows organisations to build and maintain
favourable relations with their diverse stakeholder groups (Koinig et al., 2014).
In the media industry, the concept of CSR is commonly referred to as media
social responsibility (MSR; Altmeppen, 2011). On the one hand, media social
responsibility consists of the media’s role “as the fourth estate” (Karmasin &
Bichler, 2017, p. 135): This is the case as the media observes, contextualises and
elaborates on economic developments from a critical perspective, unearths ethically
problematic corporate behaviour and integrates it into the public discussion. On the
other hand, the media is increasingly expected to also live up to the principles of
ethical business behaviour itself, as it, after all, engages in business like any other
industry (Trommershausen & Karmasin, 2021; Karmasin & Bichler, 2017).
This chapter takes a look at the status quo of the top three media organisations in
Germany, Austria and Switzerland. Section two puts CSR, MSR and change management into context by providing definitions and reviewing relevant literature, and
this is followed by the introduction of the framework that will be used as the basis for
the empirical part. The framework was developed in a recent publication by
Trommershausen and Karmasin (2021) and views CSR management as an expression of “integrity management”. This framework is used to classify the information
found on the sampled companies’ websites and derive implications on the status quo
of their CSR management in section three. Based on this analysis and relevant
literature, challenges and recommendations for change management in media companies are pointed out in the final part of this chapter and are followed by limitations
and propositions for future research.
17.2
17.2.1
Corporate Social Responsibility and Change
in the Media Industry
The Media’s Corporate Social Responsibility
Corporate social responsibility is defined as the integration of “social, environmental, ethical, human rights and consumer concerns” into business operations and “a
1
We thereby refer to organisations which are of public interest, have a balance sheet total of more
than €20 million or revenues of €40 million and employ more than 500 staff members on average
annually (WKO, 2017).
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core strategy in collaboration with stakeholders” (European Commission, 2011, p. 6)
by companies which aim to accept responsibility for their negative impacts on
society (European Commission, 2011, p. 6). Traditionally, it consists of three pillars,
known as the so-called triple bottom line: economic, environmental and social
responsibility (Elkington, 1997, pp. 72ff.), which are also found in the sustainability
concept. The economic dimension aims at establishing wealth without burdening the
ecosystem, the environmental dimension addresses the neutralisation of ecologically
harmful emissions and ending the overuse of ecological resources and the social
dimension’s core broadly relates to the equality of humans in every respect (Pufé,
2014, pp. 105–107). Against this background, CSR can be viewed as a transfer of the
sustainability concept to the business context (Van Marrewijk, 2003), where companies apply CSR activities to balance the three dimensions and achieve sustainable
growth (European Commission, 2011, p. 6). Engaging in and talking about CSR has
become increasingly relevant for companies in recent years, as public institutions,
such as the European Commission or the United Nations, and society in general
emphasize the importance of corporate social engagement. Consequently, it is on the
rise. As an additional responsibility within the CSR concept, a communicative
dimension has been introduced by Karmasin and Weder (2009), and the previous
triple bottom line has been extended to a quadruple bottom line. The authors
emphasize the relevance of organisational communication about CSR practices
and define it as responsibility itself, as a way of gaining public legitimation in the
eyes of stakeholders by contributing to set a standard of socially responsible actiontaking within the industry, for instance, by providing information on the corporate
website or publishing a CSR report. Thus, communication is a way of fulfilling
obligations of responsibility and a responsible action at the same time (Karmasin &
Weder, 2009).
The media industry occupies a special role in the CSR context. As fourth estate, it
informs and contextualises negative behaviour and engagement by other companies
and elevates it to the public agenda. As such, it contributes to raise the overall
demands for CSR (Karmasin & Bichler, 2017). Regarding its role in society, the
question towards its own behaviour arises: Does the media walk the talk or does the
media apply different standards to other industries than to itself? In the best case, a
self-reflective and proactive work on issues, which it brings to the public discussion,
could be expected. This expectation is located at the interface of media ethics and
CSR management practices and finds expression in the concept of media social
responsibility (MSR), with CSR being a part of MSR (Karmasin & Weder, 2009;
Koinig et al., 2019a, p. 112 f.). According to Altmeppen (2011), MSR is divided into
a journalistic responsibility and the responsibility of media organisations as businesses towards society. The two actors—journalism and business—interact on the
business level, but differ in their objectives. While journalism has the task of creating
high-quality content based on media ethical principles, media organisations distribute and finance their work with it. Journalism is an important instrument to give
publicity to, deliver interpretations of and reflect critically and constructively on the
debate about sustainability and business ethics at the level of the audience’s personal
lifestyles (Krainer et al., 2008, p. 123ff.; Moutchnik, 2009, p. 22). Furthermore, the
media should exemplify the issues it criticises publicly in other industries in its own
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business practices on an organisational and individual level, starting with integrating
sustainable working routines like working paperless, sharing resources and
supporting ethically reasonable positions (Krainer et al., 2008, p. 129). Taking a
role model behaviour towards this bears the opportunity to not only strengthen the
media organisation’s reputation, credibility, trust and overall stability (Moutchnik,
2009: p. 22), but also demands a constant balancing between stakeholder demands,
economics and CSR concerns (Crome, 2011, p. 260).
17.2.2
Change Management and CSR in Media Companies
To create and sustain the balance between stakeholder demands, economics and
CSR, an integration of CSR concerns into organisational processes and values is
needed (see Trommershausen in this volume). To reach this, individual company
members need to be addressed, as they are the main drivers of change. Consequently,
change management described as “an optimal design of the path from the starting
point [. . .] to the goal” (Lauer, 2021, p. 4) focuses on people as drivers of internal
change. The reasons for change depend on the individual challenges of an organisation at a certain point in time and can be shaped as a proactive action to adapt to
future developments or as reaction to crises and similar events. It can be applied to
individuals, organisational structures and even organisational culture (Lauer, 2021,
p. 4ff.) and provide an answer to developments like digitisation and
individualisation. The integration of CSR can be seen as a project, which requires
strategic change management, not only because it presupposes a certain
organisational mindset but also comes with requirements for processes and lived
values. Sustainability, and consequently CSR, plays an important role in the environment of media organisations and changing consumer demands. As public opinion, political awareness and scientific knowledge about sustainability issues are
developing continuously, the media is required to follow suit, just like companies
from every other industry. This leads to the need of an adaption of business
operations to transforming markets, all while taking increasingly urgent CSR issues
into account (Moutchnik, 2009, p. 22), e.g. minimising the organisations’ ecological
footprint or green production. In fact, change management has a positive impact on
the green development of a firm and digital maturity, which are both potential
sources of competitive advantage for future markets (Irimiás & Mitev, 2020).
Therefore, change efforts towards a holistic CSR management can pay off for
media organisations in the long run.
Several factors should be considered in order to conduct organisational change
successfully. Besides putting a person from the management level in charge to
initiate the change and communicate a clear vision of the change’s direction, scope
and objective, appropriate measures need to be taken to involve everyone who is
directly affected by the change process. Therefore, every company member should
be invited to participate in the change process successively, and groups within the
company, whose working fields are linked to the change process, should be involved
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in a continuous exchange and mutual learning. To support the change, external
consultation, proper project management and personnel development measures have
to be applied. The ultimate goal for change management is for the company to
evolve and grow, and, in the long run, it should become a natural habit. Growth and
development form the basis for the long-term and sustainable ability of organisations
to adapt to changing conditions (Lauer, 2021, p. 86ff.)
17.2.3
Responsible Communication and Communicating
Responsibility in the Media Industry
While media organisations historically have not often been at the focus of CSR
research, scholars are increasingly making them a research object. Consequently,
there is a set of valuable research on how media organisations practise and communicate CSR activities to build on. Although there is evidence that CSR is recognised
by the management of most media companies, it is not institutionalised as a core
issue. While culture changes, codes of conducts and guidelines for environmentally
friendly behaviour like energy saving have become more prominent, the activities
are more instrumental in nature rather than a holistic integration of CSR into
management practices (Karmasin & Bichler, 2017; see Trommershausen in this
volume). Although engagements often cover all CSR dimensions, decision-making
is primarily reflective of economic interests, while ethical considerations are less
important (Koinig et al., 2019a). CSR priorities vary depending on the core business
of the respective media company (Hou & Reber, 2011), but many focus on social
activities, e.g. by co-operating with NGOs or charities (Ingenhoff & Koelling, 2012;
Karmasin & Bichler, 2017, p. 142). Media-specific CSR issues are also addressed in
corporate communications, but these remain rather general and thematise CSR
issues rather moderately (Koinig et al., 2019b). Especially public service media
organisations are conservative in their communication of CSR activities as they feel
more obligated to behaving modestly and considerate of using the broadcasting fees
carefully (Bracker, 2017, p. 274; Ingenhoff & Koelling, 2012). Proactive, transparent CSR communication is generally rare and the information is difficult retrieved
from websites (Karmasin & Bichler, 2017, p. 142; Koinig et al., 2019a). This all
suggests a moderate relevance of CSR communication for media organisations, and,
indeed, according to Bachmann and Ingenhoff (2017), the extent of CSR disclosure
and content credibility has no effect on the perceived corporate legitimacy or
credibility of news media companies. Thus, there seems to be a low pressure to
engage in and institutionalise CSR in the media industry. Nevertheless, it can be
argued that CSR plays an important role for media organisations, not only because
their responsibility arises from their societal role but also because CSR can elevate
the trust in their business (Hung-Baesecke et al., 2016), ensure journalistic credibility, minimise contestability towards ethical arguments and legitimise their business
in the eyes of their diverse stakeholders (Bracker, 2017, p. 561 f.; see Litschka &
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Krainer in this volume). Against the background of the positive aspects associated
with CSR, their powerful position in society and the quickly and continuously
changing market environment that entails regulative gaps, media organisations are
advised to harness the self-regulatory potential of their CSR market standards. In this
context, Trommershausen and Karmasin (2021) call for a CSR management that is
conceptualised as integrity management: ethics and economic success go hand in
hand in a symbiotic relationship and form the basis of proper business conduct. For
media organisations this includes the integration of ethical considerations within
their own core business and the industry as a whole (pp. 1249 f.). The authors
conceptualise a framework, which will be used as basis for the empirical part of this
chapter. The following section discusses the framework in more detail.
17.2.4
CSR Management as Integrity Management of Media
Organisations
On the basis of the St. Galler Management System and integrity management,
Karmasin and Trommershausen (2021) propose to anchor CSR management in the
context of value-adding processes in a horizontal organisational structure to create
flexibility and thus adapt to the dynamic media market environment. To achieve this,
the framework points out three levels to engage in: strategic enablers, operative
management and promoting factors (pp. 1253–1263).
17.2.4.1
Strategic Enablers
The strategic enablers form the prerequisite for a successful and holistic CSR
management. It starts with an honest (inner) commitment to base future decisions
along the entire value chain on ethical grounds, which is seen as a bottom-up process
that originates from the organisational core. The second point—to establish CSR at
the management core—is expressed in the mission statement. It is the first step to
make ethical intentions public, even if they are only communicated internally, and
thus is the first real commitment to CSR that needs to sustain criticism. The mission
statement discloses a lot of information on the company’s value propositions as
applied by the management and therefore presents a crucial piece of information
when investigating the organisation’s perceived relevance of CSR. Guiding principles, values and slogans are the next step of integration. They express how the
mission will be fulfilled and can take the form of internal, industry-specific or
internationally recognised guidelines, such as Global Compact, or the media sector’s
supplement to the Global Reporting Initiative (GRI), etc. In a fourth step, the public
self-commitment via the corporate website or CSR reports presents a first step
towards making CSR engagement externally transparent and vulnerable. It is the
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317
moment of getting in touch with external stakeholders and the public which plays a
role in controlling and directing authority for CSR management of the company.
17.2.4.2
Management Operations
Once these prerequisites are fulfilled, CSR can be integrated into management
operations: Individual ethics are more relevant against the increasing speed of
transforming contexts which requires a sensitisation for employees in positions
that potentially require ethically valid decisions. This can be achieved by proper
training that follows organisational CSR principles. Further goals of the training may
be to train employees in the usage of internal instruments for CSR promotion and
control, like online platforms or reporting software. Increasing the quality, quantity
and degree of organisational stakeholder interaction is the second step towards
professionalising CSR integration within management operations. The third step is
then to institutionalise CSR in the form of ethics officers (internal
institutionalisation), ombudspersons (external institutionalisation) or comparable
positions to structure, direct and control business ethics. Additional measures to
guide the achievement of CSR goals are codes of conduct, case studies (anonymous), possibilities for discourse and the establishment of processes for CSR
communication. These instalments set the basis for the last operative CSR step,
which is CSR communication and feedback. In this step, a control system for CSR
management is formed by internal and external audits for the evaluation of feedback,
stakeholder expectations and needs as well as reporting about results of this evaluation via corporate channels, using recognised standards for both evaluation and
reporting.
17.2.4.3
Promoting Factors
As the last level, Trommershausen and Karmasin (2021) propose three promoting
factors: The first is to integrate external incentives into business operations to
increase trust and the overall relation with the organisation, e.g. through improving
data security, stakeholder involvement and the establishment of an open discussion
culture. The creation of a discursive organisational culture and structures to negotiate
internal ethical values is the second suggestion in this dimension and, according to
the authors, also described as the hardest to establish. The last consideration are
external audits and certifications that provide a measure for comparability and
competitiveness.
Comparing these levels and integration processes with the success factors of
change management listed in Sect. 17.2.2, there are several overlapping measures,
like management commitment, a vision and mission to illustrate the intended
development, as well as proper communication, an integration of the company
members and proper personnel development. On the basis of the considerations by
Trommershausen and Karmasin (2021), we will now analyse the information
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provided on the corporate websites of the three major media companies from
Germany, Austria and Switzerland, derive implications on the status quo of their
CSR management and also point out implications for change management. After
that, the results will be discussed with regard to change management’s success
factors and probable initiatives for improvement.
17.3
17.3.1
State of the Art of “Integrated” CSR Management
in Media Organisations from Germany, Austria
and Switzerland
Sample and Research Procedure
For our sample, the three major companies from Germany (Bertelsmann, ARD and
ProSiebenSat.1; Mediadb, 2020), Austria (ORF, MediaPrint 2021, Styria Media
Group; Fidler, 2019) and Switzerland (SRG SSR, TX Group and Ringier;
Medienmonitor Schweiz, 2020) were chosen in terms of their market turnover. As
we are primarily interested in examining the meaning of CSR management as
expressed in the companies’ online communication, we take a qualitative look at
the corporate websites, more precisely at the “responsibility”, “sustainability” and
“about us” sections and related documents provided online (if available). The sample
was chosen to get a general idea of the status quo in the German-speaking media
market regarding online communication about CSR management. We expect the
results to be useful in gaining insights about the state of the art of CSR management
as expressed in the above-described framework in general and with regard to the two
communicative characteristics in more detail, as these can be seen as the fulfilment
of the communicative responsibility dimension within the quadruple bottom line.
17.3.1.1
Strategic Enablers
The first prerequisite—the personal and honest commitment to CSR by the management—is not easily examined from an outside perspective. How companies address
CSR on their website may, however, offer some suggestions about their awareness
and attitude towards it. While some parties focus on the relevance of CSR as basis of
their decision-making and business policy (SRG SSR, 2021; Ringier, 2021) or have
a sustainability strategy (ProSiebenSat.1, 2021), others identify non-responsible
behaviour as a potential source of loss of revenues and trust due to increasing
demands for non-financial performance (Bertelsmann, 2021).
The mission statements of the sampled organisations rarely seem to be part of
external communication. Only four companies emphasise certain statements as their
vision or mission (SRG SSR, 2021; TX Group, 2021; Ringier, 2021; Styria Media
Group, 2021). Nevertheless, these include CSR concerned points in particular cases
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319
only. SRG SSR (2021) emphasise their engagement for diversity, empathy and
solidarity and their aim to enable their audience to create a prospective and diverse
future. In general, the media companies scrutinised herein see their mission in their
core businesses revolving around delivering information, orientation and entertainment (e.g. TX Group, 2021; Ringier, 2021; Styria Media Group, 2021).
More information can be found on the principles, guidelines and values which
organisations integrate into their daily operations. Besides journalism-oriented
values like independence, content responsibility and quality, more business and
culture-oriented values are also addressed. In most cases, they concern diversity,
creativity, innovation, stakeholder dialogue and a balanced decision-making
between economic and ecologic interests. As guidelines for internal ethical behaviour, some of the companies refer to a code of conduct (Bertelsmann, 2021;
ProSiebenSat.1, 2021; ORF, 2021; SRG SSR, 2021; Ringier, 2021) and partly
even provide these documents on their websites, which thus constitutes a public
commitment to the defined values.
Documents about values and goals do not only make the companies’ performance
regarding their CSR and sustainability contestable to the public but also work as a
display to show stakeholders how the rising expectations for responsible behaviour
(Bertelsmann, 2021) are realised. The media companies do so by providing a range
of different documents, ranging from reports about CSR or sustainability
(Bertelsmann, 2021; ProSiebenSat.1, 2021; ARD, 2021; ORF, 2021) to public
value (ARD, 2021; ORF, 2021; SRG SSR, 2021) or journalistic quality
(TX Group, 2021). The signing of voluntary agreements or membership in a
sustainability-oriented initiative by other organisations is also an expression of the
willingness to take responsibility and account for specific CSR criteria (see
Table 17.1 for a more detailed overview). For example, plans and goals are
addressed, e.g. for inclusion and equality (Bertelsmann, 2021; ORF, 2021), as are
optimising performance on sustainability characteristics (Bertelsmann, 2021; ARD,
2021; ProSiebenSat.1, 2021; ORF, 2021; SRG SSR, 2021; Ringier, 2021). As a
strategic foundation of strategies and selected topics within these concepts,
Bertelsmann, ProSiebenSat.1 and ORF (2021) refer to the SDGs as their basis.
Although one firm does not provide any sustainability or CSR-related information
on its website, most of the selected media companies refer to CSR or sustainability
more or less strongly and therefore show that it is seen as relevant topic in the
industry. It should be noted that Bertelsmann and ARD point out CSR-restraining
arguments: They emphasise the merely indirect relevance for their core business
(Bertelsmann, 2021) and the possibility that sustainability as goal may be in conflict
with their target of using resources in an economically efficient manner (ARD,
2021).
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Table 17.1 Overview of strategic enablers for CSR management
Bertelsmann
– Code of conduct
– Member of UN Global Compact
– Reference to SDGs
– GRI report since 2011, with
environmental data since 2018
– Non-financial declaration in the
status report since 2020
– Plan to become climate neutral
by 2030
– Action plan for inclusion
(2019–2024)
– Environment, paper, energy and
climate policy, diversity statement
ARD
– Sustainability and public value
dimensions defined
– Sustainability report since
2020; public value report
– Signed Charta der Vielfalt and
Gemeinsame Erklärung für eine
nachhaltige Film- und
Serienproduktion
– Member of green shooting of
MFG Medien- und
Filmgesellschaft BadenWürttemberg mbH’s
Filmförderung and European
Broadcasting Union (EBU)
ProSiebenSat.1
– Sustainability strategy since
2019
– SDGs as basis
– Code of conduct
– Sustainable sales model
– Charta for sustainability board
since 2019
– Signed Charta der Vielfalt and
Global Compact
– Sustainability report, GRI
report
– Membership in several working
groups and associations
ORF
– Guiding principles and
values
– Statute for editors,
programme guidelines,
equality plan, youth protection
– Code of conduct
– Reference to SDGs
– Instructions on corruption
– Sustainability
programme with goals
– Public value report, sustainability report
MediaPrint
SRG SSR
– Mission statement
– Charter for journalism
– CSR initiatives
– CSR as basis of all decisions
in the strategic goals
2021–2022 published on the
website
– Public value as part of annual
report
Styria Media Group
– Mission statement
Ringier
– Code of conduct
– CSR as part of business policy and daily business life
– Initiatives for increasing visibility of women in media
reporting
– Participation in programme
for climate-neutral printing
– Member of Energie-Agentur
der Wirtschaft (ENAW)
TX Group
– Mission statement
– Quality report
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17.3.1.2
321
Management Operations
To establish some internal rules of behaviour, media companies offer ethics trainings for different topic areas, like code of conduct, compliance, diversity and also
sustainable behaviour in daily operations (see Table 17.2).
The second step towards professionalising CSR management concerns increasing
stakeholder interaction. Bertelsmann integrates external stakeholders in its responsibility reporting by evaluating the estimated impact of several CSR issues on
Bertelsmann’s business operations and taking the result as a basis for their reporting.
ARD and ProSiebenSat.1 (2021) also claim to adjust their development of sustainability dimensions continuously, e.g. by developing their strategy and reporting
cooperatively, but they do not provide further information on the exact assessment.
Further initiatives are evaluations to gain knowledge about the satisfaction with the
programme offer through audience surveys, stakeholder workshops and events to
create a dialogue between media and politics, society, supervisory bodies,
employees, contractors, associations, advocacy groups or NGOs (ARD, 2021;
ORF, 2021; SRG SSR, 2021). Bertelsmann and ProSiebenSat.1 (2021) are rather
conservative in the dialogue events offered, which are described as press conferences
and roadshows for investor relation and information purposes. The German companies additionally point to their editorial or press offices as dialogue channel for the
audience.
Regarding the internal institutionalisation of CSR within organisational development, the companies name several offices, contact persons, monitoring and
management systems for ethics issues (see Table 17.2). Bertelsmann and ARD
(2021) explain decentralised, local approaches to the implementation of CSR and
sustainability projects to align actions to more individual demands of their offices
and agencies. A seemingly popular model among the German companies for internal
CSR institutionalisation are boards, councils, networks or working groups where
representatives from different departments come together on a regular basis to
exchange knowledge and review case studies on CSR and sustainability to plan
initiatives or projects (Bertelsmann, 2021; ARD, 2021; ProSiebenSat.1, 2021). A
similar approach is applied by SRG SSR (2021), though a link to CSR or sustainability is not mentioned in this case. The company solely refers to innovation. The
external institutionalisation is managed with external ombudspersons by
Bertelsmann, SRG SSR, TX Group and in most broadcasting agencies belonging
to ARD (2021). In case of ProSiebenSat.1 (2021), representatives from the European
Employee Board (EBB) are part of a sustainability board with managers from
internal key positions and operative departments.
For the communication or reporting of CSR, the selected firms use recognised
standards like the Global Reporting Initiative (Bertelsmann, 2021; ProSiebenSat.1,
2021; ORF, 2021; ARD, 2021) and the Sustainability Code (ARD, 2021). The
companies which refer to CSR or sustainability also communicate their engagement
on their websites (see Table 17.2). Formats for this communication besides responsibility sections and reports on the website are corporate responsibility
322
I. Koinig et al.
Table 17.2 Overview of management operations for CSR management
Bertelsmann
– Training measures for
integrity and compliance, anticorruption, cartel law, obligatory code of conduct training,
e-learning on code of conduct,
company guidelines and anticorruption
– Consulting on corruption
and integrity
– Relevance analyses among
external stakeholder groups on
CR topics
– Dialogue through press
office, press conferences and
publication of figures
– Decentralised implementation of CR projects
– CR council, integrity and
compliance department
– Confidential Internet system
for reports of code of conduct
violation
– External ombudsperson
– Working groups and networks for particular CR topics
(e.g. queer and environmental
engagement)
– Compliance report directly
to the board
– IT platform for environmental data collection and
analysis
– GRI reporting since 2011
including GRI media sector
disclosures, environmental
data since 2018
– CR magazine with employee
stories
– Various examples for
engagement
ARD
– Training measures for compliance, anti-corruption, cartel
right and green production in
one company of the group
– Event for discussion about
interactions between politics,
society and media
– Integration of stakeholders
to develop sustainability
ORF
– Training measures for compliance, climate protection,
accessibility, gender competence, diversity
– Climate dialogue to spread
scientific knowledge
– Event for discussion about
media quality among science,
civil society, media and audience; event for media future
topics
– Public value dialogue with
stakeholders to define responsibilities
– Annual audience survey
– Audience dialogues, studies
and monitoring
– Employee survey
– Information formfor
employees on projects and
developments
– CSR initiatives (humanitarian broadcasting)
– GRI report
SRG SSR
– Audience survey
– Ombudsperson’s office
– System for journalistic
quality assurance
– Internal statistics and
reporting about quality
external evaluations from
supervisory bodies
MediaPrint
TX Group
– Internal and external monitoring of journalistic quality
– CSR initiatives on corporate blog and newsroom
– Quality report
(continued)
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CSR as “Integrity Management” in the Media Industry: An Investigation of. . .
323
Table 17.2 (continued)
aspects
– Audience survey
– Interdisciplinary network
between broadcasting agencies
of ARD
– Network for sustainability
– CSR activities decentralised
– Dialogue initiatives for sustainability knowledge
exchange
– Complaints office for discrimination, sexual harassment
and violence
– Ombudspersons or confidence lawyers in most agencies
– Sustainability report since
2020, following DNK and GRI
criteria
– Public value report
– Evaluation of public perception of public value performance
– Sustainability process evaluation in development or
already established
ProSiebenSat.1
– Internal communication of
sustainability topics
– Roadshows and conferences
for investor relations
– Stakeholder dialogue events
and workshops
– Evaluation of stakeholder
opinion to adjust sustainability
strategy and reporting
– Chief compliance officer
– Sustainability board since
2019, corporate sustainability
office, chief sustainability officer, working group for sustainability
– Internal and external compliance management system
– Sustainability magazine,
GRI report, media-specific
information
Styria Media Group
– Annual events on relevant
topics like journalistic quality
and ethics, climate change and
journalism, organised in scientific cooperation
– CSR initiatives
Ringier
– Compliance monitoring
system, environmental management system
– CSR initiatives
324
I. Koinig et al.
(CR) magazines (Bertelsmann, 2021; ProSiebenSat.1, 2021), news sections and
corporate blogs (SRG SSR, 2021; TX Group, 2021).
17.3.1.3
Promoting Factors
The promoting factor of the integration of external incentives to CSR management is
rarely addressed and hard to evaluate from an outside perspective. As mentioned
earlier, Bertelsmann (2021) refers to the increasing expectations regarding responsibility performance as an external incentive and also to integrating environmental
data into the GRI report because of existing legal obligations. SRG SSR (2021)
addresses media ethical obligations through the Swiss press council.
Missing data also hampers the evaluation of the openness of the companies’
cultures and the extent to which dialogue is encouraged. Though dialogue formats
for environmental and social engagement are mentioned (ProSiebenSat.1, 2021;
ORF, 2021) and the cultures are described on the basis of their core company values,
e.g. as creative, cooperative and entrepreneurial (Bertelsmann, 2021) or as agile,
innovative and appreciative (SRG SSR, 2021), the practical integration can hardly be
evaluated by studying the external communication.
External audits, certifications, rankings and consulting are easier to evaluate,
because they are communicated on the website clearly by almost half of the
organisations (see Table 17.3).
Table 17.3 Overview of promoting factors for CSR management
Bertelsmann
– Culture principles creativity and
entrepreneurship, teamwork;
Bertelsmann essentials as foundation
– Corporate volunteering
– CSR/ESG/climate change rankings:
ISS-oekom; EcoVadis; Sustainalytics;
CDP; MSCI
ARD
– Green consultants for sustainable
productions
ProSiebenSat.1
– Dialogue events and workshops on
sustainability for employees, internal
action days
– ESG ratings, indices and rankings:
CDP, MSCI, DAX ® 50 ESG, SAM,
FTSE Russell FTSE4Good,
Sustainalytics, ISS, Vigeo Eiris, ISS
ESG, DVFA
– Sustainability report partly revised by
an external auditing company on the
basis of the Standard ISAE 3000
ORF
MediaPrint
Styria
Media
Group
SRG SSR
– Media ethical obligations
– Agile culture, cultural values are
learning, innovation, diversity, balance
in chances, mutual understanding and
appreciation
– Culture of appreciation as strategic
goal 2021–2022
TX Group
Ringier
– Certification “CO2 reduced” by
Energiespargruppe der Wirtschaft für
graphische Industrie for the heating
system
17
CSR as “Integrity Management” in the Media Industry: An Investigation of. . .
17.3.2
325
Discussion and Implications
The most striking findings from studying the selected corporate websites were the
country-specific differences. German companies provided the most detailed information on their CSR and sustainability performance. They all had reports on CSR
available for download on their websites, while among the two Austrian media
companies that thematised CSR, only ORF (2021) gave deeper insights into its
sustainability practices through downloadable content and specific website sections.
The Styria Media Group and the Swiss companies communicated in a more reserved
way about their CSR activities, without reports, goals or specific numbers. The
reason for the difference between the extensiveness of CSR communication and
particularly CSR reporting between Germany and Austria on the one hand and
Switzerland on the other hand may be found within the EU- and country-specific
regulations on CSR reporting.
The discovered differences within the countries were mostly in line with previous
research. Koinig et al. (2019b) also observed Germany to be the most active country
regarding its CSR communication. Ringier was the company that provided the most
information on CSR among the Swiss companies in their study, while the TX Group
provided almost none.
In the case of Germany and Switzerland, it was also striking that the public
service media companies ARD and SRG SSR communicated on a more moderate
level than the private media companies Bertelsmann, ProSiebenSat.1 and Ringier.
Former studies justified this with the companies’ obligations and expectations to use
their publicly raised financial resources with care and in respect of the interest of
their audience (Bracker, 2017, p. 274; Ingenhoff & Koelling, 2012; Karmasin &
Bichler, 2017, p. 142). This difference was not apparent in the Austrian case.
Our approach of evaluating the state of the art of CSR management and CSR
communication shows that it is becoming increasingly relevant to pay attention to
CSR practices and communication in the media industry. This trend is expressed by
the accumulation of communicated CSR actions in the recent past: Strategic instruments for CSR action and communication have been increasingly integrated over the
last few years. For instance, the sustainability strategy by ProSiebenSat.1 has been
established successively since 2019 and its signing of the UN Global Compact took
place in 2020. Likewise, the first sustainability report for the whole ARD company
group was published in 2020. Though the trend of practising and communicating
about CSR seems to be spreading within the industry and also strategic approaches
are increasingly emphasised, the presented study results suggest that there is still
room for improvement for both areas of CSR communication—the integration of
CSR within the management structure and the proactive communication about CSR.
The approach introduced by Trommershausen and Karmasin (2021) may serve as a
fruitful template on how to introduce change management for a more responsible
and sustainable business (see Trommershausen in this volume).
Regarding CSR communication, a more integrated approach (Diehl et al., 2017)
may also be an objective for media companies in order to react to the increasing
326
I. Koinig et al.
stakeholder demands for responsible company actions, positioning them as futureoriented and trustworthy and gradually taking on a role model function for the
industry. Following Bruhn and Zimmermann (2017, p. 17 f.), the benefit creation
for the company must be clear. In the case of the media, this may be trust in the
industry and with regard to the global sustainability challenges, increasing awareness for its responsibility. As change management and CSR are initiatives that pay
off in the long run, plans need to be long term and fit the company’s culture, strategy,
behaviour and CSR performance. A consistent stakeholder dialogue becomes even
more important with digital communication methods that allow increasingly aware
individuals and organisations to gain access to information on (ir)responsible behaviour and the possibility to expose cases of corporate misconduct. As stakeholders
become more powerful and demanding (Capriotti, 2017, p. 205), the dialogue to
negotiate the right direction, promote achievements and monitor signals from stakeholders in order to react to sensitive issues in time is a challenging but fundamental
task (Bruhn & Zimmermann, 2017, p. 17 f.). The observed companies partly invest
in this task, but efforts have been moderate to date.
In order to establish CSR as a change management project, companies should see
responsible actions as an ability to be acquired and developed rather than a process
with a fixed beginning and end. The overall aim of organisational change is to
become and stay sensitive to opportunities and liabilities regarding CSR and sustainability issues. Lauer (2021) refers to this level of awareness and integration as
learning organisation which is the result of individual learning steps. Thus, training
and development offerings need to be established more readily. While such offers
exist in the areas of compliance and code of conduct in some of the surveyed
companies, offers with a specific focus on CSR and sustainability are rarely available. In order to integrate a responsible mindset and actions into organisational
socialisation processes, knowledge on these topics and the communication and
interaction related to CSR need to be strengthened (p. 221 f.). Involving experts
for corporate sustainability in the personnel development and conducting employee
workshops on idea development with methods like design thinking may be fruitful
approaches to establish a more integrated take on CSR. Also, continuous refreshment and further development of CSR knowledge should be part of managing
change.
Though it is emphasised that change is not a process with a defined end, Kaiser
and Schwertner (2020) argue that it is important not to overburden employees,
project teams and management by claiming continuous improvement without stable
characteristics to rely on. Defined project beginnings, milestones and ends may
counteract the logic of the learning organisation, but may stimulate employee
motivation and activation better than a never-ending process of reorganisation.
Within the change process stable workflows are needed, e.g. in the newsroom to
keep daily business going. These processes may be adjusted gradually in order to
allow for a smooth transition. Therefore, media companies are advised to approach
their CSR and sustainability-related change with multiple smaller projects under the
umbrella of a unified vision and mission statement (p. 32 f.). As these statements are
rarely linked to CSR and sustainability in the observed sample, this would be a first
17
CSR as “Integrity Management” in the Media Industry: An Investigation of. . .
327
adjustment to make. One measure to approach the communication internally, and
later also externally, may be storytelling (see Diehl et al. in this volume). Having a
profound story that makes the change understandable and easy to reproduce helps to
embed and spread the relevance among employees, stakeholders and the further
environment of the company. This more targeted communication is enabled by
trends of convergence and further awards companies the opportunity to engage in
a dialogue with their diverse stakeholder groups (Morsing & Schultz, 2006). In
general, open and transparent communication about the change project should be at
the core of the change management in order to keep employees informed, gain high
acceptance and prevent rumours (Kaiser & Schwertner, 2020, p. 35ff.).
17.4
Limitations and Directions for Future Research
This study has various limitations. First, the analysis only focused on the companies’
corporate websites. Information provided on other communication channels might
have produced further information on the respective company’s CSR management.
Social media channels may offer a more detailed picture of how stakeholder dialogue
is practised. Second, the sample is quite small and therefore may not be sufficient to
represent the industry within the three countries. Third, the countries also are rather
similar to each other. Fourth, the used framework focuses more closely on the
business side of MSR, which leaves questions open for the journalistic side of
CSR communication.
These limitations open the field for further research. It may also be interesting to
examine provided information from a media accountability perspective, which
focuses on internal and external measures to ensure content quality (Koinig et al.,
2019b, p. 173). Also, the framework may be used on results gained through other
research methods, like personal interviews with the management or CSR representatives or surveys among employees. In doing so, more insights regarding CSR from
an internal perspective may be gained. As suggested by Capriotti (2017, pp. 200 f.),
another research approach may take the presentation of the online CSR information
into account. The websites with the most extensive communication present their
CSR content on various sub-pages which makes a quick and meaningful overview
difficult. Therefore, experimental approaches on usability, architecture and interaction tools may provide valuable results.
17.5
1.
2.
3.
4.
Exercise and Reflexive Questions
What relevance do CSR and CSR communication have for media companies?
How is media social responsibility defined?
What is the relation between change management and CSR?
On which levels can CSR management be established within a company?
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I. Koinig et al.
5. Discuss the challenges related to the integration of CSR management within
companies. How can they be overcome?
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Isabell Koinig is a Postdoctoral Researcher at the Department of
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of health communication (pharmaceutical advertising, eHealth/
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intercultural advertising, organizational health, as well as media
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Anika Bausch is University Assistant at Department of Media
and Communications at the University of Klagenfurt, Austria. She
currently is working on her PhD in the area of social enterprise
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Matthias Karmasin is Director of the Institute for Comparative
Media and Communication Studies of the Austrian Academy of
Sciences and the University of Klagenfurt, where he is full professor for media and communications sciences. His research areas
concern organisational communication, media ethics and media
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media practice and media accountability. For further information,
please
see
https://www.oeaw.ac.at/cmc/the-institute/staff/
matthias-karmasin/.
Chapter 18
The Normative Turn in the Organisation
of Media: Ethical Considerations
for Change Management in Media
Enterprises
Michael Litschka and Larissa Krainer
Abstract In this contribution our aim is to provide some philosophical foundations
for legitimising modern business. We argue that the social embeddedness of business must lead to a normative turn in management theory and change management,
meaning that ethical approaches to management will have to be included in management theory to an even greater extent. This, among other things, can entail
considerations on the moral obligations owed by companies, stakeholder
approaches, CSR and communicative rationality, and integrative business ethics.
For this change to take place in media organisations, we should first understand the
importance of the “organisation” in today’s mediatised world and secondly think of
organising normative considerations as a “process” within media firms.
18.1
Introduction: The Importance of Normative
Considerations in Media Management
Many developments in the media economy seem to demand normative considerations. First, there are sociological challenges like the phenomenon of mediatisation,
understood as the role of the media system as a whole in the organisation and
reproduction of our social relations (Adolf, 2011, p. 154). As such, it entails
theoretical and empirical research aiming at an analysis of the changing patterns of
media and communication in particular and of culture and society in general (Hepp,
2016, p. 227). Then we see rising economic challenges, exemplified by the economic
pressure on media organisations; a business ethical term for that pressure is
M. Litschka
St. Pölten University of Applied Sciences, St. Pölten, Austria
e-mail: michael.litschka@fhstp.ac.at
L. Krainer (*)
Alpen-Adria Universität Klagenfurt, Klagenfurt, Austria
e-mail: larissa.krainer@aau.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_18
331
332
M. Litschka and L. Krainer
“economization” (Ulrich, 2001), referring to the fact that human relations are seen
and defined as economic interactions using the specific kind of (economic) rationality guiding these actions and decisions. From an economic perspective, the process
of mediatisation implies the encroachment of new kinds of value added based on
media-related structures, exemplified by the proceduralisation and storage of knowledge, the selection and processing of information, and all levels of technological and
economic convergence; organisations become producers of social capital (dealing
with the economics of attention) and real capital (dealing with the economics of
production) at the same time (see Litschka & Karmasin, 2012 for more detail).
Consequently, media companies are forced to find new business models (see
Schwarz and Gustafsson in this volume), often based on platforms and their inherent
network effects, making it more efficient to use the two-sided market many media
houses face (audiences and advertising markets). This again has led to the wellknown phenomenon of “produsage” (Bruns, 2006; see Langner and Klinke;
Terlutter and Ninaus in this volume), meaning that people can be producers and
recipients of media goods at the same time, and the rise of social media platforms
based on clicks and the corresponding problem of “fake news”. Research is still
going on regarding how that use is negatively influencing the necessary “publicity”
(in the Habermasian sense) media need to provide for a democratic society to work.
Finally, yet importantly, technological advances have made it possible for media
managers to micro-target their audiences and adapt their media offerings to the
specific needs of the recipients (see Terlutter and Ninaus in this volume), of course
mostly steered by algorithmic processes and often violating the privacy of customer
data (see Saurwein, Hattenberger & Vidreis, and Mueller et al. in this volume).
Another recent issue of research is that such algorithmic strategies not only invade
our previously privately owned data but may also determine our future behaviour
(in the sense of adapting our behaviour to please the algorithm and reach personal
goals like employment opportunities, a better credit rating, earlier release from
prison, etc.). Besides this ethical problem, it is quite possible that turning formerly
private into open data can lead to economic concentration and great market power
for platform enterprises, as Litschka and Pellegrini (2019) have shown.
All of this makes it obvious that media managers do not operate in a value-free
space where the pursuit of economic strategies and elaborate business models can be
their only task. If we talk about change management in the media industry, such
change must also be one from a “positive” to a “normative” view of management.
This change needs to take place on several levels: the macro-level of media and
economic policy and regulation, the meso-level of organisations (on which we will
focus in this contribution), and the micro-level of individual managers.
In the following sections, we try to pave the way for such a normative turn by
defining some basic philosophical foundations for ethically legitimated business
(2.1), explaining some normative management theories (2.2), stressing the importance of media organisations as specific normative entities (2.3), and suggesting
ways to organise ethical processes within media organisations (2.4).
18
The Normative Turn in the Organisation of Media: Ethical Considerations. . .
18.2
18.2.1
333
The Legitimisation of Business and Organisational
Strategies: Towards a Normative Turn in Media
Management
Philosophical Foundations of Business: Some General
Remarks
The following depictions lay out a rights-based view of business transactions and
then use the social contract view as legitimisation strategy. The arguments in this
section are a condensed version of a more detailed account in Litschka and Karmasin
(2012, p. 226f.). Both approaches lead to the same conclusion, namely, that business
needs to have a normative basis to be legitimated in society.
Business ethics uses the concept of “collective action” (e.g. Lenk & Maring,
1992, p. 154) to describe business transactions in the economy that are characterised
by labour division and complex projects, where individual responsibilities are often
hard to define or even discern. Whenever big projects, strategic actions, complex
causal processes, asymmetric information, or decisions made in common are
concerned, and the “inner structure” of organisations (decision systems,
organisational structures, hierarchies, etc.) determines individual decisions, we
may want to assign responsibility to an organisation as a whole (Göbel, 2006,
p. 92). In Werhane (1992, p. 329ff.) we can find a philosophical legitimisation for
the often-stated demand that organisations be responsible for their actions and
decisions in that she connects the rights, which enterprises demand in capitalist
systems, with respective duties. If companies want to act autonomously (without
government intervention), claiming legal rights to do so, these rights are constituted
as moral rights; if such rights exist, they come with moral duties, of which the taking
over of certain responsibilities is a major part. One of these would be to accept the
rights of all other persons and corporations as equal, which implies that corporate
rights embody duties to individuals, too. She continues to define those organisational
rights as secondary rights, derived from individual rights (Werhane, 1992, p. 332),
and as “secondary moral actor”, organisations can be made responsible for their
actions, without resorting to individual moral responsibilities.
When looking for a theoretical legitimation for organisational obligations,
another approach used in business ethics is social contract theory. Here, norms and
values arise from a strategic bargaining process resulting in an agreement between
individuals of a society. As long as the “contract” is of mutual advantage to the
members of the bargaining process, there should be enough motivation to follow the
norms derived. It is rational and socially advantageous to stick to the norms, and
working together leads to a so-called “cooperative” surplus (Kersting, 1996, p. 265).
That an organisation should accept certain stakeholder rights and give itself restrictions that may constrain its own rights was, for example, postulated by Donaldson
(1989, p. 44ff.).
In his contractarian thought experiment, an organisation exists because it contributes more value to society (e.g. employees or consumers) than individuals
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M. Litschka and L. Krainer
working alone could ever manage to achieve. Some principles of justice or human
rights may be part of the agreement: Members of the society would join such a
contract only if, as part of the “cooperative surplus”, it is ascertained those fundamental principles of human rights or justice are adhered to by the enterprise. All
parties to the contract have to accept the ensuing rights, and, similar to Werhane’s
argument, out of these rights, we may derive obligations. For Donaldson, obligations
deduced directly from social contract agreements are the most important obligations,
and these must be fulfilled without reservation. He gives the following example
(Donaldson, 1989, p. 89): It may be one of the rationally agreed upon norms that
companies must contribute to the subsistence of employees; it must neither violate
this right by paying sub-standard wages nor let any external violation of this right
happen (e.g. indirectly hindering the growing of food there).
We have provided two possibilities (a rights-based approach and a social contract
approach) to legitimise the moral responsibility of organisations (see Litschka &
Karmasin, 2012 for a more complete account). All of these ask for the specific
contribution of organisations to social welfare and how organisational actions and
decisions may be legitimised in view of this goal. Before we consider (media-)
organisations in more detail, we want to show that the aforementioned philosophical
considerations have already had some impact on management theories.
18.2.2
From Descriptive to Normative Management Theories
Management theories have undergone substantial changes from early approaches
stressing leadership, efficiency, and above all the adherence to shareholder value, to
more recent approaches concerning social responsibilities of management, stakeholder orientation, and integrative viewpoints giving more importance to normative
considerations. This section summarises some of the developments.
Directly opposing the shareholder view of the firm, a more inclusive approach
towards management was embraced by the stakeholder approach.
A stakeholder theory of the firm must redefine the purpose of the firm. The stockholder
theory claims that the purpose of the firm is to maximise the welfare of the stockholders,
perhaps subject to some moral or social constraints, either because such maximisation leads
to the greatest good or because of property right: The purpose of the firm is quite different in
our view. [...] The very purpose of the firm is, in our view, to serve as a vehicle for
coordinating stakeholder interests” (Freeman & Evan, 1993, p. 262).
It follows that any corporation should be managed for the benefit of its stakeholders (customers, suppliers, owners, employees, and local communities, among
others), and the rights of these groups must be ensured. Furthermore, all groups must
participate in those decisions that substantially affect their welfare. In this sense,
management bears a fiduciary relationship to stakeholders and to the corporation as
an abstract entity, bearing the long-term stakes of each group in mind (Freeman &
Evan, 1993, p. 262). In the media industry with its preeminent role in the working of
a democratic society and its complex relations with multiple stakeholders (and its
dual market characteristics), such stakeholder approaches may gain even more
18
The Normative Turn in the Organisation of Media: Ethical Considerations. . .
335
normative importance (see, for example, Karmasin, 2007 for stakeholder management in media firms).
Another strain of thought in management literature states that the adoption of
social responsibility is an imperative of business integrity. This imperative is
demanded by communicative rationality, while the long-term existence of the firm
pertains to strategic rationality (Ulrich, 2001, p. 443). As opposed to social contract
theory, the acceptance of moral obligations by organisations need not be aligned
with strategic rationality and can even counter the profit motive of capitalist enterprises. The integrative business ethical approach, e.g. championed by Ulrich,
directly addresses how value added is generated in the (media-)society. If we accept
the republican-public legitimisation duty of an enterprise, it follows that an organisation is a quasi-public value-added institution, and the stakeholder perspective is
the appropriate way of managing such organisations (see Phillips, 2003 for the
organisational ethics view of stakeholder management). An organisation is then
put under an unlimited public legitimisation discourse (public deliberation in the
Habermasian sense) in the civil society, and this discourse is acknowledged to be the
systematic place of organisational morality.
The strand on corporate social responsibility (CSR), corporate governance (CG),
corporate citizenship (CC), or the general term corporate responsibility (CR) is quite
diverse (see Karmasin & Litschka, 2017 for an overview). At the heart of CSR lies
the connection of organisations like companies to their social environment (also see
Koinig et al. and Trommershausen in this volume). When markets dominate economic transactions and nation states withdraw from their role as socially responsible
actors, there is a gap of responsibility for social matters that enterprises and big
institutions can fill (Roberts, 2006, p. 10 f.). Ever since the “Greenbook CSR” was
published by the EU Commission in 2001, the stress has been on the “voluntary”
inclusion of social and ecological issues in the economic strategies of a firm (see
Allouche, 2006, for an overview). While more and more firms engage in so-called
social reporting and sustainability initiatives, some authors (e.g. Freeman et al.,
2010, p. 42) think that CSR sometimes degrades to a PR measure in order to
“greenwash” doubtful actions. CSR would need to be considered sooner than at
the beginning of the value chain, else it can only “soften” the possible negative
impact of economic decisions. This amounts to being trapped in the so-called
separation fallacy (Freeman et al., 2010, p. 241), i.e. the (virtual and misguided)
separation of “business” and “ethics”. Ethics must be placed before the value chain
starts and legitimate the kind of value creation a company wants to pursue.
In a communicative sense, CSR asks organisations to communicate their responsibility in a transparent and credible way. This comprises ways to institutionalise
ethics within the organisation, e.g. by installing an ethics officer or producing an
ethics code, and making accountability possible, e.g. by introducing new forms of
disclosure. In addition to the well-known triple bottom line reporting (using indicators for economic, social, and ecological performance), Weder and Karmasin (2011)
suggest that a “quadruple bottom line”, as the task of institutionalising ethics and
committing to it, is mainly a communicative one. Organisations should communicatively operationalise ethics through reproducing it and providing incentive systems.
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M. Litschka and L. Krainer
“Corporate communicative responsibility” hence becomes the fourth dimension of the
triple bottom line, paving the way to communicating responsibly and communicating
responsibility. For management, that would entail using new forms of communication
like stakeholder dialogues, stakeholder assemblies, stakeholder participation via social
media, and new disclosure methods like social reporting.
18.2.3
The Power of Media Organisations
We now turn our attention to media organisations, as they steer communication
possibilities in our mediatised world and are communicative constructs themselves
(e.g. Saxer, 1999; Ortmann, 2002). Taking up this argument, we can see the primary
role of the organisation as a principal structuring element in a “society of organizations” (Perrow, 1996). As we have argued elsewhere (Litschka & Karmasin, 2012,
p. 224 f.), organisations like schools, universities, hospitals, media, platform companies, production companies, banks, insurances, etc. determine when, where, and
for how long people need to work; they decide upon possibilities and conditions of
purchase, upon capital flows, and upon retirement provisions; they compress time
(see just-in-time-production) and expand time (in the hope of receiving interest
payments); they define spaces for gainful employment and structure networks;
they simply construe the world in a complex environment. They may produce public
impact, attention, and content, but while this is the traditional core of their business
activities, they also engage in trade (e.g. e-commerce), services (e.g. consulting,
logistics, platform services), and of course technology (e.g. development of algorithms). The “change” implied by this transition may call for change management
but also poses deeper normative concerns: The power (and market power) of these
organisations to shape the structure of our lives, consumption, jobs, and communication needs to be (see the philosophical arguments above) connected to moral
obligations we want them to address.
Considering all this, they also become moral instances with the possibility of
being attributed to ethical responsibility (Noll, 2002; Karmasin & Litschka, 2008).
This is especially true for media companies and their rising influence on our personal
lives and modes of communication. The next section discusses this problem in more
detail and uses a process ethical approach to operationalise normative change
management in media organisations.
18.2.4
The “Organisation” of the Normative Turn in Media
Organisations
If one follows the lines of thought so far and acknowledges that there is a normative
turn in media organisations and a multitude of different stakeholders bring their
18
The Normative Turn in the Organisation of Media: Ethical Considerations. . .
337
respective ethical ideas and demands to bear on media organisations, the question
arises how this can and should be organised.
While in traditional hierarchical companies ethics could still be determined
largely “from above”, in organisations more committed to stakeholder management,
this becomes difficult or even impossible. In addition, there is a growing awareness
that ethics has to deal with contradictions (conflicts of objectives). For media
companies, such conflicts of objectives are, for example, the demand to be both
fast and accurate in the production of news, to work in a quality-orientated and
profit-orientated manner, to ensure high standards and entertainment, and to win the
trust and goodwill of both audience and advertisers. Accordingly, media companies
must ensure a sensible balance of such goals within their organisations and beyond
the boundaries of the organisations (in dialogue with their stakeholders).
Process-orientated ethical approaches deal with the question of how to achieve a
broad discussion of divergent but justified normative conceptions, which are
represented by different actors, and how to organise ethical decision-making processes. Examples of process-oriented approaches are different models of shared
responsibility like discourse ethics or the stakeholder approach and process ethics.
Discourse ethics by Jürgen Habermas (1991) emphasises the importance of
“justice”, which means in particular “equal participation in discourses” (principle
of participation). It follows from this that nobody may be excluded from the
discourse (principle of emancipation; Arens, 1996, p. 96). In current debates, the
ethics of discourse is used, for example, for the interaction between journalists and
the “produsers”, when it comes to giving their voice an equal status (Stapf et al.,
2017, p. 11). Prinzing derives a “mandate for audience dialogue” from the principle
of high responsibility of journalism “for a functioning public discourse” (Prinzing,
2017, p. 36).
From a media-economic perspective, some authors use a concept from the field of
technology ethics, when, for example, Lenk (1987, p. 135) pleads for a “socially
shared responsibility” and Karmasin (2010, p. 219), who understands media companies as corporate actors, assumes that not “everyone can be responsible for
everything in principle”. He suggests a model of “graded responsibility”; this
means, on the one hand, that the performance of certain functions simultaneously
determines the extent to which responsibility is to be assigned and, on the other
hand, that more power also implies more responsibility.
The stakeholder approach (see above) was originally developed in (AngloAmerican) business administration and was subsequently introduced into media
economics. The approach was initially developed for listed companies, whereby it
represents an antipole to shareholder concepts that are criticised from both a theoretical and normative perspective (cf. Post et al., 2002, p. 11ff.). One reason for this
is that it does not recognise shareholders as the only relevant decision-makers and
demands that companies not only maximise their profits but also take responsibility
for their other stakeholders (customers, suppliers, the municipal public, etc.).
Karmasin has applied the approach to media companies as economic actors and
notes that this would enable the creation of “transparency”, “communication relations”, “inclusion of affected parties in decisions”, and “internalization of
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M. Litschka and L. Krainer
responsibility in companies” (Karmasin, 1998, p. 385). Litschka (2013) takes up an
economic approach when he refers to Amartya Sen (1987) and uses his considerations for ethical media management and the consideration for “media capabilities”
(see also Litschka 2019). Furthermore, he combines his analyses with those from the
stakeholder approach and the process ethics approach (see also Litschka &
Karmasin, 2012).
The approach of process ethics has a philosophical tradition (Krainer & Heintel,
2010) but also addresses media organisations very directly when proposals are made
for the organisation of participatory as well as collective ethical decision-making
processes, in which the respective balancing of the conflicts of differing objectives
described above is at stake (Krainer, 2001).
Even if there are relevant differences between the approaches (Krainer, 2018), we
can nonetheless emphasise some central and shared normative basic concerns. In all
approaches, the aim is to look beyond the level of the individual and his or her
personal moral decisions and focus on the responsibility of collectives. One motive
for this is to relieve individuals where they appear structurally overburdened
(especially in complex contexts). Another motive is to enable collective ethical
decision-making beyond the level of individual enlightenment and thus collective
enlightenment or even collective autonomy. A central idea here is to strengthen the
self-determination and autonomy of the organisation in this way. If norms and values
in organisations are jointly recognised and shared, the willingness to cooperate for a
common cause increases—so the hypothesis goes. (Media-)organisations should
therefore see to it that:
– All those affected by an (ethical) decision should be able to participate in it.
– Foreign control is not possible, especially since it seems incompatible with the
idea of freedom of opinion; hence, the formulation of normative guidelines from
the perspective of science is avoided.
– The aim of the process is to safeguard different interests and, if possible, to
balance them. In this respect, there is a shared awareness that this is a matter of
contradiction management.
In the end, it is hoped that through broader participation and thus integration of
conflicting opinions, qualitatively better decisions can be reached, which also have a
better prospect of collective insight, agreement, and durability.
This brings us to a final basic idea for our remarks on the normative turn in media
organisations and the respective understanding of change management: where
norms, values and ethics become important, reflection is essential. That is, firstly,
collective norms and values must be worked out, which requires reflection on one’s
own ideas; secondly, ethical ideas also need to be reviewed regularly to determine
whether they are still appropriate and should therefore be maintained or whether they
require modification; thirdly, reflection can also promote the further development of
organisations as far as consistent self-observation and comparison as well as dialogue with others promote the development of new ideas and enable innovation. In
this respect, reflection is an important piece in the mosaic for the success of media
organisations.
18
The Normative Turn in the Organisation of Media: Ethical Considerations. . .
18.3
339
Conclusion and Future Outlook
We have tried to show that some philosophical underpinnings of the social
embeddedness of business necessarily lead (and in fact have led) to a normative
turn in management theory, including considerations on the moral obligations owed
by companies, stakeholder approaches, CSR and communicative rationality, and
integrative business ethics. The normative turn in the organisation of media leads to
the need to reflect and organise ethical issues, as neither their business case is free of
ethical questions nor do managers act in an ethically free (value-free) space. For the
practice of media companies, however, one important question is how normative and
ethical discussions and decisions can be organised, which opens up a discussion
about the necessity for process ethical models when the organisation of ethics within,
for example, a corporation is at stake.
As far as media organisations are concerned, we argue that they have multiple
responsibilities, as they are content producers, enablers of dialogue, and structuring
elements of our use of technology and communication. To assume stakeholder
responsibility and organise their change management activities using normative
deliberations is a first-order prerequisite for them to legitimise their business activities. In times of mediatisation, economisation, lightning fast technology developments, and disruptive upheavals, we should ask for this normative turn even more
urgently, and it would seem sensible for media organisations to do so in a selfregulated way, else they will sooner or later face a societal discussion on more
external (at least co-) regulation.
18.4
Exercise and Reflexive Questions
1. What is meant by a “normative turn” in media management?
2. Which philosophical models come to your mind when business must be ethically
legitimated?
3. What are the specifics of the stakeholder approach in management?
4. What ethical responsibility (and to whom) does a media company have?
5. What is meant by a “process-orientated” way of organising normative reflections
in organisations?
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Michael Litschka is professor at the Department of Media and
Interactive Technologies at the University of Applied Sciences St.
Pölten. He is head of the research group “Media Business” at the
university and founding member of the IMEC (Interdisciplinary
Media Ethics Center). His research areas concern economic and
business ethics, media ethics, and media and platform economics.
For further information please see https://www.fhstp.ac.at/de/
uber-uns/mitarbeiter-innen-a-z/litschka-michael.
Larissa Krainer is professor at the Department of Media and
Communications (MK) at the University of Klagenfurt. She has
published many articles concerning communication studies, media
ethics, sustainability studies, and intervention research. From
2014 to 2019, she was the chair of the executive board of the
Interdisciplinary Media Ethics Center (IMEC). A full list of
Larissa Krainer’s publications is available online at: https://cam
pus.aau.at/cris/search/index?category¼publications&
clear¼true&persidf¼-1263879852_employee
Chapter 19
Uncharted Territory: Datafication
as a Challenge for Journalism Ethics
Colin Porlezza and Tobias Eberwein
Abstract The chapter summarizes results from an empirical study that intends to
shed light on current change processes in journalism ethics. Qualitative interviews
with media practitioners and a document analysis of ethics codes and guidelines in
ten European countries show that newsrooms are confronted with a broad spectrum
of ethical issues that are seen as a direct result of the digitization of journalism. While
many of them led to adaptations in the practices of media self-regulators across
Europe, datafication and algorithm-driven newswork remain uncharted territory.
19.1
Introduction
Data are playing a crucial role in our modern society and shape almost every aspect
of our lives: from the use of social media to online banking, from health to
government surveillance—in all these fields, data can be collected, analyzed, and
commodified (van Dijck et al., 2018). The invention of the Web, an increasing
digitization, as well as the omnipresence of mobile communication devices contribute to the generation of a data deluge (Lewis & Westlund, 2015), a “revolution that
will transform how we live, work and think” (Mayer-Schönberger & Cukier, 2013).
These fundamental transformations are accompanied by an increasingly dominant
role of algorithms in society (Uricchio, 2017) that, together with the centrality of
data abundance, will eventually bring about a “datafied society” (Schäfer & van Es,
2017).
Following the wider transformation of society, the trend of datafication has been
embraced by the journalistic field as well, even if, in some cases, not without
C. Porlezza (*)
Università della Svizzera italiana, Lugano, Switzerland
e-mail: colin.porlezza@usi.ch
T. Eberwein
Institute for Comparative Media and Communication Studies (CMC), Austrian Academy of
Sciences/University of Klagenfurt, Wien, Austria
e-mail: tobias.eberwein@oeaw.ac.at
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_19
343
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resistance (Lewis & Waters, 2018). Nowadays, computers, data, and algorithms play
a central role in journalism and influence all relevant areas of newswork, from
information research to content production and distribution (Diakopoulos, 2019;
see Saurwein in this volume). In other words, there is evidence of a “computational”
(Coddington, 2015) or “algorithmic” (Napoli, 2014) turn in journalism. However,
there is a double relevance to this transformation: The same means—data and
algorithms—that distinguish the datafied society are used by journalism to observe,
in turn, the datafication of society as it becomes an important object of reporting
(Porlezza, 2018).
Data are the result of the use of digital technology by individuals, communities,
and organizations. Data of “who did what, with what information, together with
whom, when, for how long and in what sequences and networks” (Jensen, 2014,
p. 229) can be aggregated and analyzed with the help of algorithms, in order to
determine and predict people’s interests or whereabouts. Data, therefore, allow for a
specific insight into human behavior. Since Edward Snowden’s revelations in 2013
we know that both private companies and governments are collecting a plethora of
data about citizens either to commercialize them or for surveillance purposes
(Greenwald, 2014). Hence, journalism increasingly uses large amounts of data as
well (Paraisie, 2014), particularly when it comes to investigative or data-driven
forms of journalism. This could be seen, for instance, in the case of the Panama
Papers leak, where journalists—in a collaborative effort of more than 160 journalists
and technologists and with the help of data mining algorithms—had to sift through a
data bulk of 2.6 terabytes or more than 11.5 million documents (see Garcia-Aviles in
this volume).
These changes in journalistic newswork not only put the journalists’ skillset to the
test but also many of the current professional norms and values—and they create
new ethical challenges, particularly with regard to principles such as transparency
and privacy, that did not exist at this level in the analog era of journalism. Making the
right choice whether to use data that are easily available or to respect the privacy of
individuals becomes a judgment call of utmost importance, or as Whitehouse (2010,
p. 324) argues: “Certainly there are times to expose secrets and more individuals
should become aware about the information they share about themselves, but that
does not mean privacy should be invaded simply because the tools are easily
available.” Suddenly, even questions regarding digital data protection, for instance,
against malevolent hackers or government surveillance, become a relevant issue in
news organizations (see Mueller et al.; Hattenberger and Vidreis in this volume).
The issue gets even more intricate in the case of transnational journalism, because
the legal and regulatory frameworks with regard to the use of data or data-driven
tools in terms of privacy and free speech differ considerably between media systems
and journalism cultures. In the USA, for instance, publishing sensitive material
under the protection of freedom of speech is generally prioritized compared to
privacy rights (Volokh, 2000). On the other hand, leaking secret government
material can lead to imprisonment under century-old espionage acts.
While news organizations are responding to a digital disruption of postindustrial
journalism (Anderson et al., 2014), journalism is changing and rethinking its
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Uncharted Territory: Datafication as a Challenge for Journalism Ethics
345
practices (see Garcia-Aviles in this volume). However, as changes occur in newsrooms, they need to be thought of within the framework of a particular social and
cultural sphere. Ekdale et al. (2015) have shown that change is more successful if it is
in line with current norms, cultures, and practices (see Litschka and Krainer in this
volume). If ethical issues are not taken into account, managing change can become a
tricky thing, particularly when unexpected normative inconsistencies arise. As
algorithms and artificial intelligence are already institutionalized in news production
(Beckett, 2019; Thurman, 2019), they start to gain the attention of various institutions of media self-regulation.
The chapter uses the example of datafication and the algorithmic turn in journalism in order to analyze how technological change affects the current discourse about
journalism ethics in general and the practice of media self-regulation in detail. With
the following analysis, the authors intend to highlight deficits in the ethical framework of journalism, which need to be tackled, particularly “in the midst of profound
changes and challenges to the profession” (Deuze & Witschge, 2017). In order to
reach this aim, the chapter presents results from a two-step empirical study which
includes qualitative interviews with different experts in the field of (digital) journalism and a document analysis of codes of ethics and editorial guidelines in ten
European countries. The empirical design will make it possible to understand
whether and how different actors in the field of media self-regulation reacted to
the algorithmic turn that has occurred in journalism—and which challenges are still
unheeded.
19.2
Background: Journalism Ethics and Datafication
Datafication not only affects journalistic practice but also journalism’s professional
culture and the social setting of news organizations. The implications of these
transformations can perhaps be seen best in relation to forms of automated journalism, where “human and automated journalism will likely become closely integrated
and form a man-machine marriage” (Graefe, 2016, p. 11). The computational and
algorithmic turn in journalism comes, therefore, with the need for a normative and
ethical turn (see Litschka and Krainer in this volume).
Usually, traditional communication and media ethics are regarded as a
sub-discipline of practical philosophy (Rath, 2014), which analyzes human action
essentially in reference to what constitutes good and responsible behavior in a certain
field of application. When it comes to the ethics of journalism, this normative
approach leads to the definition of ideal values like truth, freedom, solidarity, as
well as order and cohesion (McQuail, 2013); standards such as accuracy, sincerity,
and care (Couldry, 2012); or other key tenets such as transparency, particularly when
it comes to algorithmically produced news (Diakopoulos & Koliska, 2017). All these
principles are regarded as prerequisites for democratic media in order to fulfill their
social function.
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The ongoing media transformation calls for an ethical reconceptualization, given
that technological advancements reshape the relationships between journalists,
machines, and their publics. As the speed of the transformations has grown over
time, first with digitization, then with new forms of multi- and transmedia storytelling, and eventually with automated journalism, the question of evaluating which
norms to keep unaltered, which ones to adapt, and what kind of new principles to
introduce becomes a complex issue (Singer, 2015)—even more so as ethical principles change slowly and only upon extensive pressure. As newswork is now
increasingly characterized by data, algorithms, and artificial intelligence, journalists
are largely navigating in uncharted waters when it comes to ethical principles.
The complexity of the situation can be illustrated by reference to the case of
automated journalism, where one aspect stands out: the question of algorithmic
transparency, or rather the comprehensibility and explainability of algorithms. The
German Data Ethics Commission (2019, p. 169) states, for instance, the following:
“For a robust ethical and legal evaluation of algorithmic systems, it is essential that
sufficient information about their scope, functioning, data basis and data evaluation
is available. Only a system that is transparent in its approach can be checked to see
whether it pursues a legitimate purpose” (transl. CP). Since transparency is considered a central tenet of journalism ethics (Dörr & Hollnbuchner, 2017), the calls for an
improved “algorithmic transparency” are frequently voiced in media and journalism
studies (Pasquale, 2015; Diakopoulos & Koliska, 2017; Helberger et al., 2019;
Porlezza, 2019).
However, transparency is anything but easy to implement when it comes to
algorithmic systems. As Ananny and Crawford (2018) show, the concept of transparency has many limitations, especially when it comes to its application in journalism. For example, transparency can have harmful effects by exposing vulnerable
individuals or groups. This could be well observed in the aftermath of the “tennis
racket” enquiry by Buzzfeed and the BBC, which investigated tennis players apparently involved in a betting scandal and match-fixing: While Buzzfeed did not publish
the names of the tennis players, a group of undergraduate students from Stanford
University was able to de-anonymize and publish the names of all involved players
grounded on the data they got from GitHub (Diakopoulos, 2016). In other cases,
journalists must protect their informants, for instance, whistleblowers, because they
can suffer serious consequences or are faced with criminal charges. This shows that
transparency in journalistic work is by no means an absolute value, but must always
be assessed in relation to other values such as data protection or privacy. Data
journalists in particular need to take these challenges into account, as they are
inclined to follow the ethics of open data and open source, otherwise they incur
the risk that “basic ethical obligations [. . .] dissolve in the wash of data” (Fairfield &
Shtein, 2014, p. 50).
With regard to the disclosure of algorithms, there is also the question of data
literacy, particularly for journalists. As Steensen (2019, p. 198) points out, many
journalists do not have the necessary data competence to fully grasp how algorithms
work, which is why statements produced by automated journalism are characterized
by an inherent uncertainty. This also raises questions about who can be held to
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347
account for algorithmic output, especially when false, biased, or misleading information is involved (Lewis et al., 2018; Monti, 2019). The centrality of this problem
is also mentioned by Fairfield and Shtein (2014, p. 47) because it concerns a core
activity of news media: “Journalism ethics is substantially devoted to minimizing
harm caused by information dissemination.” Particularly with regard to privacy,
journalists should proceed with extreme caution, as (personal) data present massive
challenges with regard to their use and analysis: “We give numbers their voice, draw
inferences from them, and define their meaning through our interpretations. Hidden
biases in both the collection and analysis stages present considerable risks, and are as
important to the big-data equation as the numbers themselves” (Crawford, 2013).
As the Web spans around the globe, journalists may also slide into contexts that
go beyond their institutional, legal, or cultural boundaries, where ethical queries
become difficult to handle out of personal beliefs (see Voci and Karmasin in this
volume). “Here, as well, it is necessary to think ‘globally,’ as values such as privacy
may be culturally specific and what is considered an appropriate balance between
privacy and freedom of expression will vary between cultures” (Eynon et al., 2012,
p. 25). A global approach is also endorsed by Stephen Ward in his radical media
ethics when he states that “young journalists need greater social and cultural
knowledge with a global perspective” (Ward, 2014, p. 468).
These observations demonstrate that datafication brings along many ethical issues
and open questions, particularly when it comes to the implementation of algorithmic
systems and artificial intelligence in newswork. It remains unclear, however, how
newsrooms and institutions of media self-regulation react to the current change
processes and how this affects journalism ethics and media self-regulation in the
long run. What exactly are the dominant challenges of digital journalism from the
perspective of media practitioners and self-regulators? Have news organizations and
institutions of media self-regulation developed an awareness of the ethical consequences deriving from the ubiquitous media transformations at all—and how do they
affect their change management? Are the specific problems of digital journalism,
including datafication and automation, reflected in their editorial guidelines and
codes of ethics—or do the professional rules and regulations need to be adapted in
this respect? These questions were in the focus of the empirical study that is
described in the following sections of this chapter.
19.3
Methodology: A Two-Step Approach to Studying
Change in Journalism Ethics
In order to shed light on the current transformations in journalism ethics and media
self-regulation, a two-step research design was combined with a comparative analytical approach:
In a first step, in order to reach a better understanding of the current developments
in digital journalism ethics, we conducted problem-centered interviews (Witzel,
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2000) with 15 experts from the fields of journalism, social media, and media selfregulation who were selected because they had firsthand experience with the challenges that we wanted to discuss with them.1 The interviews followed a halfstandardized field manual that was supposed to help the interviewers to structure
the relevant issues of the analysis and reflect them with the interviewees in a
comprehensive manner. The focus was on three broad areas: (a) a compilation of
pressing ethical issues in digital journalism, (b) an evaluation of contemporary media
self-regulation in the light of the current change processes, and (c) future perspectives for media self-regulation. The interviews were carried out face-to-face, via
telephone, or via Skype (Hanna, 2012) and lasted up to 85 minutes. They were
recorded and transcribed in full, in order to subject them to a structuring qualitative
content analysis (Mayring, 2014) afterwards. This procedure allowed us to complete
a systematic inventory of current issues in digital journalism ethics (see Eberwein
et al., 2016, for further details)—an attempt that has largely been neglected in
communication sciences up to now.
In a second step, this inventory was compared with selected international codes of
ethics and newsroom guidelines, in order to find out how far the practice of media
self-regulation really lives up to the challenges that journalistic ethics have to face at
present. This was made possible with the help of a document analysis (Prior, 2003)
that initially focused on the prevalent professional codes of ethics in journalism in
ten countries in Eastern and Western Europe (Austria, Estonia, Finland, Germany,
Italy, the Netherlands, Poland, Spain, Switzerland, and the United Kingdom), which
were chosen in order to encompass different types of media systems and degrees of
journalistic professionalization in Europe (Hallin & Mancini, 2004, 2012).2 This
step of our research can be seen as an extrapolation and specification of similar
analyses (e.g., Limor & Himelboim, 2006; Heinonen, 2010; Díaz-Campo & SegadoBoj, 2015), which are outdated by now and/or excluded the issue of datafication in
the first place. Moreover, and in contrast to these pilot studies, we also looked at
selected codes of practice, guidelines, mission statements, statutes, and similar
1
For practical reasons, the interviewees were recruited in the German-speaking world only. They
included representatives of the press councils in Germany, Austria, and Switzerland, the German
Journalists Association (DJV), the Forum Journalism and Media (fjum) in Austria, the Independent
Complaints Commission for Radio and Television (UBI) in Switzerland, the Munich School of
Philosophy, the Universities of Salzburg and Fribourg (CH), the Hamburg State Chancellery,
editors from tagesschau.de, dossier.at and Neue Zürcher Zeitung (NZZ), freelance (online) journalists, and bloggers. Direct quotations from the interviews are presented in an anonymized form in
the following sections.
2
The codes of ethics included the Ehrenkodex for the Austrian Press, the Code of Ethics for the
Estonian Press, the Finnish Guidelines for Journalists, the German Press Code, the Italian Testo
unico dei doveri del giornalista, the Guidelines of the Dutch Raad voor de Journalistiek, the Polish
Media Ethics Charter, the Código Deontológico of the Federation of the Press Associations of
Spain, the Swiss Declaration of the Duties and Rights of a Journalist, and the British Editors’ Code
of Practice.
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documents on the level of single news organizations.3 This strategy is grounded on
the reflection that newsrooms represent an important place where ethical issues in
journalism are discussed on a practical and day-to-day basis (Meier, 2014). Both
professional codes and company guidelines were examined for terms such as
“Internet,” “Web,” “online,” “digital,” “user-generated content,” “social media,”
“big data,” “automation,” and “algorithm.” These keywords eventually allowed us
to identify those passages in the codes and guidelines that directly refer to the
digitization of journalism. A comparison with the results of our first research step
laid the basis for an assessment of the current practice of media self-regulation, as it
could specify which of the ethical problems of journalism are still largely
disregarded by the news organizations and press councils in Europe and to what
extent their codes and guidelines need to be updated.
19.4
19.4.1
Findings
Challenges for Journalistic Ethics
and Self-Regulation
The interviewed experts leave no doubt that the field of journalistic ethics and selfregulation is currently in a state of change due to the digitization of the international
media landscape. Their statements help to raise an awareness for a broad spectrum of
ethical challenges that are summarized and systematized in the following passages,
thus laying the foundation for our further analysis. As the evaluation shows, the
perceived challenges of digital journalism are by no means restricted to issues
resulting from datafication and automation.
Generally, many of our respondents point to the transformed contexts of a
journalism in digital media surroundings. This becomes noticeable on the structural
level, among other things. “In former times,” one expert explains, “it was common
that journalism took place within fixed editorial structures. You had colleagues, you
had newsrooms, you had fixed procedures. Now, all of this falls away ever more
often. It becomes more and more unclear what pulls an editorial department together.
[. . .] Thus, the ethical basics become more diffuse as well. This is a problem!”
Furthermore, the trend towards a 24-h news cycle has led to a rising time pressure
within the profession. This development also provokes more mistakes in the coverage. “This pressure to be up-to-date [. . .] implies that some newsrooms do simply
not wait for a second independent source. But this is important for reputable news
journalism,” another interviewee explicates. In such cases, the digitization of media
communication contributes to the obliteration of traditional journalistic rules of
3
The search for such documents was restricted to the newspapers and broadcasters with the highest
reach in each country, in order to keep the investigation manageable.
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accuracy—a problem that was by no means completely unknown in the offline era,
but becomes evident more clearly in the current media transformations.
In turn, the accumulation of journalistic inaccuracies leads to new challenges for
the editorial error management. Indeed, it is easier to correct mistakes in the online
field. However, as one of the interviewed experts stressed, “for many media it is not
common to make errors public and transparent. The appropriate culture [. . .] is
simply missing. [. . .] It would be generally desirable to create more openness and
transparency in [. . .] journalism.”
Moreover, our respondents diagnose an increasing dissolution of the boundaries
between editorial contents and advertising, which seems to become more alarming
due to new forms of online PR. This trend is illustrated by the example of native
advertising, which, according to one expert, “certainly causes media-ethical problems and which can result in malpractice by nature. In this case, journalistic reports
can be influenced and manipulated by advertisers. The user, however, is often unable
to distinguish which advertiser is setting the tone in which report and has possibly
exerted influence on the contents of an article.” This is fatal for journalism, another
interviewee adds: “When the boundary between journalism and advertising breaks
down, the reader bows out—and in the end the journalists are left empty-handed.”
The respondents are similarly critical about the journalistic treatment of all kinds
of user-generated contents. “We have been dealing with user participation for years
now. And this may all be well—but over time so many problems have emerged that
we did not anticipate in the first place. And now we really do not know how to deal
with them.” This not only concerns the moderation of user comments, which often
collide with well-established journalistic norms, but also the quality management of
other forms of user-generated contents.
Another dominant topic in the expert interviews was the maintenance of different
social media platforms. From the perspective of media ethics, the respondents not
only rate the separation of private and professional postings by journalistic actors as
important. Besides the question how to treat social media as a publication channel, it
was also discussed in which way Facebook and Twitter can be used as a research
tool. In such a scenario, it is paramount to respect the users’ privacy, various experts
claim: “It is not uncommon that journalists use social media to search for data,
although these are only semi-public in themselves. For all intents and purposes,
boundaries are being crossed here. Generally, the question applies: What is public,
and what is not? What can be published, and what cannot?”
Moreover, our respondents repeatedly broached the issue of digital archives and
the “right to be forgotten.” On the one hand, many experts stress the potentials of a
long-term storage of journalistic contents, which clearly enhances newsroom transparency. On the other hand, this potential can quickly turn into an ethical problem,
particularly when false facts—which might compromise the reputation of a person
that is covered by the media—are published online. Such digital traces are hard to
erase, once they are available in the digital media world. According to one of our
interviewees, a responsible journalist “must also think about how to deal with this: Is
it really necessary that every content is available until the end of days?”
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While most of these issues are certainly pressing, not all of them are completely
new to the digital media world, but rather constitute an aggravation of existing
ethical challenges due to the specific mode of operation of digital communication. In
contrast, the trends towards a growing accumulation of big data and innovative
forms of automated journalism seem to be particularly complex because they are
uncharted territory for most newsrooms. Such developments, as one expert stresses,
create numerous follow-up questions, which are still unanswered in the present
discussion about quality and responsibility in journalism. “At which point do I still
have a classical editorial department or a single journalist, which I can hold accountable? Or to what extent must I start thinking about something like an ethic of
algorithms? If I have a technological infrastructure for selecting and presenting
contents, should it not be the programmer who receives an ethical sensitization for
the demands relating to the creation of a public sphere?”
Questions like these demonstrate that the discussion about the ethics of digital
journalism has reached a crossroads at present—and its future direction is anything
but clear. Thus, it is not surprising that most of our interviewees come to critical
conclusions about the current system of media self-regulation and demand
adaptations.
Certainly, most experts do not question the key role professional institutions such
as the press councils in Germany, Austria, and Switzerland play for the mediacritical discourse in these countries. However, many arguments in the interviews
point towards deficits in the complaints procedures: The three institutions seem to
operate too slowly and become active too rarely on their own initiative, and their
mode of operation is criticized for being intransparent and for mostly having little
impact on the profession. Almost unanimously, it is assessed that the press councils
are attached predominantly to the structures of the print media and that they pay only
insufficient attention to the realities of online communication. “‘Press council’—
even the term comes from a different, analog world,” one expert claims. “It is high
time to search for something new. ‘Media council’ would be more neutral at any
rate.”
For almost all experts, a central strategy to approach the online world is to be
found in the adaptation of the central codes of ethics in professional journalism.
Even if first steps have already been taken in some European countries, they do not
go far enough according to our experts, as they disregard many of the ethical
challenges of digital media. However, the development of a new code for online
journalism is not an option for most respondents. “If we had two central codes of
ethics at the same time, this would make matters unnecessarily complicated,” a
German expert says, for example. “I think that the existing core of the Press Code has
proved to be successful in the past—against all odds. This is a good basis, which can
be developed. A second code—that would not be recommendable.”
Moreover, the institutions of media self-regulation are counseled to reconsider
and strengthen their own online presence—despite limited resources. “Maybe they
could also establish a blog, for the matters that come in now and then, about which
they have to decide,” one interviewee advises. “This would not be so bad. They
would be more up-to-date like this. And they would be perceived in a completely
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different way, most notably among onliners.” A stronger engagement on social
media such as Facebook and Twitter could also contribute to making the work of
the press councils more transparent and intensify the dialogue with audience actors.
This issue needs to be tackled all the more urgently, because—as another expert
stresses—“right now I have the feeling that it is not really possible to interact with
the Press Council. Particularly not on the digital level.”
Anyway, as journalism is increasingly gearing towards openness and interactivity, it is considered a necessity that other stakeholders besides journalists and media
managers are involved in the processes of media self-regulation, diminishing further
the defensive behavior of normative boundary-setting criticized by Singer (2015).
For example, a stronger focus on audience engagement could help the press councils
to appreciate to a fuller extent the ethical problems in the field of participation and
produsage. A discourse with watchbloggers and other actors of a web-based media
critique is regarded as particularly promising. “Sometimes,” a German expert
reports, “single watchblogs intentionally refer to the Press Council, by filing complaints. Following the motto: We are going to show you! We bring in our expertise!
And then the Press Council deals with the specific case in a more detailed manner.
This is a completely new dynamic which is unfolding at the moment. This is a good
kind of co-existence!” But also other online actors—such as Google, Facebook, and
Twitter—should be involved in the discourse about quality and ethics in journalism,
another respondent demands. Further important stakeholders are the different actor
groups in journalism education, from j-schools to universities, but also the schools,
which could transport the topic into society from early on. Last but not least, media
policy-makers could trigger useful impulses in the sense of a co-regulation of the
media, several Austrian experts believe.
Be this as it may—according to our experts, the status quo of media selfregulation, particularly in terms of normative guidelines, seems to be inadequate
under all circumstances.
19.4.2
Codes of Ethics in Transformation
Is such a critical assessment backed by the second step of our empirical analysis? At
least the assumption that specific ethical problems of digital journalism are not
reflected in the relevant professional codes and guidelines is no longer true for
many of the analyzed countries. As the document analysis that was realized for
this study shows, most of the central codes of ethics—for example, in Austria,
Finland, Germany, the Netherlands, Spain, Switzerland, and the United Kingdom—have been updated at least in selected points over the recent years. Italy
constitutes a special case: The professional Order of Journalists used the current
upheavals to compile a completely new document in 2016—the Testo unico dei
doveri del giornalista, which consolidates a number of previous ethical charters and
includes a few new guidelines for digital journalism for the first time. Many of the
updates, both in the Italian Testo and the other codes, hint at specific challenges in
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Uncharted Territory: Datafication as a Challenge for Journalism Ethics
353
the digital media world that may come up in all phases of the editorial production
process—both before and after the publication of a news item. However, a discussion of the ethical problems resulting from the use of big data and automated forms
of communication remains an exemption in all of the analyzed documents—at least
until the completion of this study (May 2020). In contrast to the other examples, the
central codes of ethics in Estonia and Poland do not mention any of the ethical
challenges that are related to the digitization of journalism yet.
According to our document analysis, these challenges start to unfold in the phase of
journalistic information collection, which has been increasingly relying on online
sources or data that can be collected and analyzed online over the past years. However,
the danger of stumbling upon false data in the online realm makes it necessary to
develop new accuracy routines for digital journalism. As the Directives relating to the
Swiss Declaration of the Duties and Rights of a Journalist postulate, “[j]ournalists
should be particularly critical in regard to sources when researching on the Internet”
(Directive 7.5). The British Editors’ Code of Practice also refers to privacy issues that
can arise when unspecified “digital communications” (Sect. 2.i—Privacy) are used for
research purposes, and it demands that journalists must not access “digitally-held
information without consent” (Sect. 10), which is relevant for search processes on
social networking sites, among other things. The Spanish Código Deontológico
contains a specific rule stressing possible violations of copyrights and intellectual
property in the digital age: Accordingly, journalists “will avoid all forms of plagiarism
and will pay special attention so that the reproduction of content through technological
means does not violate the aforementioned rights” (Principle II.5; transl. TE). The
Swiss Directives even debate the conditions under which “[t]he media may publish
information that has been obtained through leaks” (Directive a.1).
The presentation of journalistic contents on digital platforms entails further
ethical challenges that some of the analyzed codes specify. This concerns, for
example, the use of links to original sources—and the question of how far a
journalist is expected to show responsibility for a linked website or whether the
link might even constitute a danger to its originator. Consequently, the Guidelines of
the Netherlands Press Council remind us that “[j]ournalists who link in their
publications to information of third parties need to consider whether the interest
served by including a (hyper)link in the publication is in reasonable proportion to the
interests that are potentially damaged as a result thereof” (Section C). According to
the Spanish Códigó, such considerations are particularly important in the case of a
necessary distinction between information and advertising as well as any “institutional and private activities of social communication which may imply a conflict of
interests with the principles and norms of the journalistic profession” (Principle III.6;
transl. TE). The Italian Testo demands unrestricted transparency with regard to the
journalists’ sources, “even when materials—texts, images, sound—from [. . .] social
networks are used” (Article 9; transl. TE). The possibilities of digital image
processing tools also raise concerns about the authenticity of journalistic online
publications. Therefore, it is important that “[i]mage manipulations may not be
misleading,” as the Dutch Guidelines explicate further (Section C). Instead, readers
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and viewers “must be made aware of anything that causes an obvious change to the
image,” the document details—similar to Guideline 3.3 of the Ehrenkodex for the
Austrian Press.
Further ethical problems result from the editorial handling of digital follow-up
communication after the publication of journalistic contents—such as online comments or other forms of user-generated contents, which are discussed in several
codes across Europe. For example, the German Press Code clarifies that such
contents have to adhere to the standards of professional journalism as well. Hence,
“[e]ditors shall ensure compliance with journalistic principles if they detect violations through user-generated content or if such violations are pointed out to them by
third parties. In the event that editors select or edit individual user-generated content,
compliance with journalistic principles must be ensured from the outset” (Guideline
2.7). Similar recommendations are described in the Swiss Directives (5.2), the Dutch
Guidelines (D), and the 2011 Annex to the Finnish Guidelines for Journalists, some
of which are complemented by a note that any user contribution on a journalistic
website must be labeled explicitly, unless other reasons prevent this. Moreover,
several codes outline special rules for the correction of errors on journalistic
websites. According to the Finnish Guidelines, “it is not enough that the incorrect
information or article is removed, the public must also be told about the error, as well
as how and when the correction was made” (Sect. 20). Similarly, the German Press
Code makes claims for transparency when it states that “the rectification is to be
linked to the original content,” and “[i]f the rectification is made within the publication itself, it must be marked as such” (Guideline 3.1). The Swiss Guidelines go
beyond these regulations when they debate the particular challenges of online
archives and stipulate a “right to be forgotten,” which applies to those convicted
of crimes, particularly when cases are dropped or the accused is found not guilty.
Directive 7.5 demands in this context: “Editors should examine justified requests as
to if names should be removed from or facts updated in reports held in electronic
archives.” According to the Dutch Guidelines, however, such a retrospective
anonymization is justified “in exceptional cases only” (Section D).
Besides looking at ethics codes that intend to cover the profession as a whole, we
also analyzed relevant guidelines on the level of the media company (newsroom
codes, social media guidelines, etc.) as well as codes of practice for specific areas of
action. The research shows that such documents are currently flourishing all over
Europe, but are still an exemption rather than the rule—and if they exist, they are
often not made public adequately. The prevalent model—particularly among print
media—is the development of “editorial guidelines.” In most cases, however, they
rather constitute short mission statements and only rarely contain tangible instructions that are relevant for journalistic ethics. Hints at specific problems of digital
media communication, and datafication in particular, were not detectable in them, at
any rate. However, we found best-practice examples in almost all of the countries
studied—mostly in the field of public service broadcasting. For example, the British
Broadcasting Corporation (BBC) developed Editorial Guidelines, which contain a
voluminous discussion of the institution’s values and standards that apply to all
journalistic employees. In addition to the abovementioned challenges of digitization,
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Uncharted Territory: Datafication as a Challenge for Journalism Ethics
355
they also discuss—among other things—the online protection of children and young
people (Sect. 9), the specific problems of online votes in the context of political
coverage (Sect. 10), the problems of links to commercial websites and their implications for editorial integrity (Sect. 14), as well as issues connected with expressions
of opinion by BBC employees on social media that “have the potential to compromise the BBC’s impartiality and to damage its reputation” and, thus, result in
conflicts of interest (Sect. 15). Such conflicts seem to be an intricate ethical problem
for many media corporations across Europe. As a consequence, various public
broadcasters have released specialized social media guidelines—such as the Austrian Broadcasting Corporation (ORF) and Swiss Radio and Television (SRF).
But the ethical challenges of digital journalism do not end here. An international
expansion of our research strategy demonstrates that there are further documents
with ethical guidance relating to journalistic action in the online realm. These
include codes or checklists for specific areas of application, such as the fields of
data journalism, automated journalism, or even drone journalism (see Saurwein in
this volume). Predominantly, however, they need to be read as unfinished work-inprogress collections of current problems rather than conclusive sets of guidelines,
which suggests that the formation of obligatory norms in their particular areas is still
in progress.
Altogether, the document analysis provides ample proof that the professional
ethics of journalism are in the middle of a process of transformation. Some of the
new challenges that are described in the evaluated codes and guidelines mirror the
issues that we could highlight and systematize with our qualitative interview study;
others, however, do not yet—if at all—play a dominant role in the documents that
codify the ethics of professional journalism in Europe, including issues of
datafication and algorithmic communication, which are only mentioned in a few
specialized guidelines. This partly refutes our experts’ assumption that the institutions of journalistic self-regulation have not developed an adequate awareness of the
ethical problems deriving from current digitization processes so far. At the same
time, the analysis collects various relevant hints at deficiencies in the evaluated
codes that obviously demand further adaptations, thus suggesting possible perspectives for the future of journalism ethics and media self-regulation, particularly in
reference to the use of digital data.
19.5
Discussion and Conclusion: Perspectives
for Journalism Ethics and Media Self-Regulation
The ethics of journalism in a digital media environment are in a state of transformation—just like the profession as a whole. For a long time, communication
researchers as well as media practitioners were primarily interested in the particular
chances and potentials of Web-based communication channels. Currently, however,
practical experience suggests that the promising innovations of digital journalism are
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reversed all too frequently and confront journalistic actors with new ethical problems
instead, which never arose in analog newsrooms. The two-step methodological
design that was realized for the study made it possible to survey these problems
and to systematize them. The most conspicuous of them are:
– The increasing requirements of journalistic accuracy, particularly in the context
of Internet searches and links to external online contents
– The necessity of new provisions for newsroom transparency, ranging from
handling errors, pursuing an open data and open access strategy in connection
with data journalism, and being transparent about the inner workings of
algorithms
– New difficulties with the separation of editorial content and advertising, for
instance, in native advertising strategies
– Problems of digital long-term archives, above all in the context of a “right to be
forgotten”
– Problems with the moderation of user comments and other forms of usergenerated content
– Challenges resulting from the journalistic use of social media as a research tool, a
source of data, and a distribution channel
– Questions about an ethic of algorithms, for example, in the context of automated
journalism
Not all of these issues are completely new: For example, problems relating to
journalistic accuracy or the separation of news and advertising were well-known in
the pre-Internet era and have long been key challenges in the discussions among
media self-regulators. In the current media transformations, however, their shattering
power grows, which may justify a renewed examination of the related values and
standards. At the same time, the digitization of newswork also leads to the emergence of completely new ethical dilemmas that do not have any analogy in the offline
world and that are mostly still a “black box” for media ethicists and media practitioners in different journalism cultures around the globe. This trend is particularly
obvious in the fields of datafication and algorithm-driven communication, which our
study highlighted as major ethical challenges, while widely recognized norms and
standards are still missing. This insight reinforces the conclusion that professional
journalistic ethics must always be related to the technology by which the news is
produced.
The empirical findings presented in this paper, together with the theoretical
reflection, show three distinct developments when it comes to journalism ethics in
the context of datafication. First, the common belief that traditional institutions of
media self-regulation (such as press councils) are ill-prepared to tackle ethical
queries related to the context of digital journalism is proven to be false, albeit only
as a general statement. There are many press councils that have recently adapted
their codes of ethics to the needs and challenges of digital journalism. The same
applies to the ethical guidelines of news organizations, which are even more flexible
when it comes to reacting to previously unknown ethical quandaries.
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Uncharted Territory: Datafication as a Challenge for Journalism Ethics
357
However, and this is the second point, the issues related to datafication and
automated communication often transcend traditional norms and values linked to
journalistic practice. They refer to a larger societal context—and, at the same time,
they may vary between different (even Western) cultures. We have shown that, for
instance, the judgment of privacy versus freedom of expression (in the use and
publication of data) differs considerably between Europe and the USA (see also
Whitman, 2004). On top of this heterogeneous setting, journalists also have to think
about the increasing importance of openness and transparency in journalism, which
is reflected by movements such as open or networked journalism that embody the
digital culture of participation (Jenkins et al., 2015). Nevertheless, even if transparency is often invoked as a one-size-fits-all solution, it is neither an absolute value in
journalism nor easy to implement, as Ananny and Crawford (2018) have convincingly demonstrated. Collecting, analyzing, and publishing massive amounts of data,
for instance, within data journalism projects, may well pose a threat to privacy, as
sensible data within large datasets will be made publicly accessible (see Mueller
et al.; Hattenberger and Vidreis in this volume). Journalists are thus forced to balance
openness and the risk to incur an informational harm by exposing data of individuals
without explicit consent, given that it might be possible to reconnect (anonymized)
data to individuals through data profiling.
The third development concerns the work-in-progress in different niches such as
data journalism or drone journalism. Albeit the efforts of some stakeholders prove
that professional journalistic ethics are in the middle of a process of transformation in
the digital age, conclusive sets of guidelines are anything but complete. Our list of
ethical challenges may help to identify blank spaces in the given guidelines and
adapt them to the necessities of the online world as comprehensively as possible.
Ultimately, when it comes to normative reflection in the context of datafication,
many questions remain only vaguely answered. Even if it seems reasonable to talk
about a computational and algorithmic turn in journalism, there is no evidence of
such a turn in journalism ethics yet. Hence, we suggest new impulses for the practice
of media self-regulation: While essentially ignoring the increasingly important
context of an open and transparent journalistic production (see Garcia-Aviles in
this volume), media self-regulation is still based on the core activities of the
journalistic profession, which is in turn reflected by one-dimensional normative
principles. Although big data (and the algorithms used in journalism to analyze
them) are uncharted territory with regard to the professional norms and values of
journalism, they need to be addressed. This should be done in the form of collaborations between different stakeholders: journalists, programmers, hackers, and users,
but also academics studying these phenomena. In the digital era, with its dominant
participatory culture, many actors are willing and able to contribute to discussions
about digital journalism ethics. These questions should, therefore, not be left to press
councils only.
The same goes for communication sciences and journalism studies: Contemporary communication and media ethics have to be seen as an integrative discipline,
that (a) has to blend philosophical reasoning about media ethics with the practical
findings of empirical media research (Eberwein & Porlezza, 2016) and (b) has to
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bring together expertise from different disciplines that study the ongoing media
transformation. It is only by bridging these gaps, and by moving the “context” of
datafication into the center of the scholarly debate, that the future of media and
journalism ethics can be cleared.
19.6
Exercise and Reflexive Questions
1. Do you think that the digitization of journalism has increased the number of
ethical problems in everyday newsroom practice?
2. How and to what extent can the use of social media pose a challenge for
journalistic quality standards?
3. Describe a potential ethical dilemma that is a direct result of the increasing
datafication of journalism. How can this dilemma be solved?
4. Why does the implementation of artificial intelligence-based tools in newsrooms
pose a particular problem in terms of journalistic responsibility?
5. Do you think that the existing ethics codes suffice to deal with the challenges of
digital journalism, or does the profession need new ethical norms?
6. Do you consider press councils to be an effective means of journalistic quality
management? Try to identify and discuss their strengths and weaknesses.
7. Which other instruments are available to strengthen the accountability of journalists in the digital age, and how would you rate their impact?
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Chapter 20
Harnessing Change in a Disruptive
Environment: Case Studies in Media
Management and Innovation
Jose Alberto García-Avilés
Abstract We examine news companies in which management has played a key role
in the process of implementing innovations. Eight international case studies in media
innovation were selected using a convenience sampling method. A retrospective
study was designed to analyse the elements involved in the implementation of
innovations. These case studies show that to identify innovation opportunities,
managers should focus on product leadership, improving organisational competence, and satisfying users’ needs.
20.1
Introduction: Change Management in the Media
Change is the basic element influencing strategic management in the media industry.
The ability to adapt to an increasingly competitive environment has always been a
vital requirement for media organisations. Therefore, to survive and grow, media
companies must adapt and lead their own transformation. The scope of change is
shaping market competition conditions, as audiences, advertisers, and journalists
themselves are becoming increasing volatile (Storsul & Krumsvik, 2013).
Throughout the history of journalism, technological developments, variations in
business models, and changing consumer preferences have forced media companies
to transform themselves. Journalists have faced the challenges posed by new ways of
gathering, producing, delivering, and updating the news and had to find different
sources of income to sustain their viability. Newsroom reactions to change range
from developing entirely new products in response to the changing needs of news
consumers to increasing the quantity of news output. However, in the current digital
environment, news organisations face an unprecedented speed of change and a
growing level of disruption.
Disruption theory argues that “new entrants to a field establish a foothold at the
low end and move up the value network—eating away at the customer base of
J. A. García-Avilés (*)
Miguel Hernández University, Elche, Spain
e-mail: jose.garciaa@umh.es
© Springer Nature Switzerland AG 2022
M. Karmasin et al. (eds.), Media and Change Management,
https://doi.org/10.1007/978-3-030-86680-8_20
363
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J. A. García-Avilés
incumbents—by using a scalable advantage and typically entering the market with a
lower-margin profit formula” (Christensen, 2012, p. 7). Disruptive technologies
usually play a leading role in market disruption because incumbent technologies
are displaced, customers shift their purchases to products based in the invading
technology, and incumbent companies do not react in a timely manner (Gholampour
Rad, 2017; see Terlutter & Ninaus in this volume). Disruptions in the media sector,
such as video streaming (YouTube), music streaming (Spotify), or social media
(Facebook, Instagram), tend to create a new market entirely through the introduction
of a different kind of product or service, so that both consumers’ preferences and
performance metrics change in a radical way, with immediate consequences for
incumbent companies.
Newcomers are challenging the legacy media that traditionally dominated the
market. Many news start-ups have placed user experience, design thinking, and
product at the core of their mission, in addition to journalism itself, in a way that
legacy news outlets have not been able to equal (Usher, 2017). Digital news start-ups
have a flexibility their legacy counterparts lack. Their infrastructure is less costly
without significant industrial operational cost, though original content creation is
still expensive. Moreover, news start-ups are chasing important stories that legacy
media are not covering, and their reporting is making a social impact (Schmitz Weiss
et al., 2018).
The characteristics of the media sector differ from those of other industries.
Specific features include the perishable commodity of the media product, creative
employees, intricate organisational structures, and a public service role, among
others (Küng, 2007). Accordingly, media management encompasses complex issues
that involve people’s motivations, company structure, administrative systems, and
product/process strategy, to create value for the organisation (see Litschka & Krainer
in this volume). It is no wonder that the field of media management studies remains
“underexplored and undertheorized” (Mierzejewska, 2011, p. 14).
The discord between theories of management and managerial practices in the
media may have led to a certain disregard of the theory of management in the news
industry, where it is often assumed that managerial and journalistic skills go hand in
hand (Malmelin & Virta, 2016, p. 1045). However, many journalists have become
managers once they have accumulated a solid professional experience after long
careers as reporters or correspondents, but they lack formal training in management.
In addition, most newsroom managers have little time to reflect on the way they
manage their juniors. As Deuze (2011, p. 10) argues, “in short, the problem of
contemporary media work, as felt and experienced by its practitioners, is
management”.
Media managers are often reluctant to implement change in their organisations,
due to a series of “contradictory logics”, such as uncertainty about audiences and
technologies or weak institutional decision-making (Lowrey, 2011, p. 66). As the
economic crisis hits the media industry and news organisations are downsized,
leadership and strategic planning to achieve long-term goals become a crucial
asset. Media companies need “to act strategically and radically in improving their
editorial processes and products as well as their business models and organizational
20
Harnessing Change in a Disruptive Environment: Case Studies in Media. . .
365
structures” (Westlund & Lewis, 2014, p. 11). Therefore, recognising the importance
of innovation—and its technological, economic, structural, creative, and social
implications—is a critical first step along the path for the survival of media
organisations.
20.2
Implementing a Culture of Innovation
in the Newsroom1
Media management scholars are paying growing attention to the culture of innovation in journalism (Dal Zotto & Van Kranenburg, 2008; Habann, 2008; Küng, 2007,
2011). However, the literature on media innovation tends to focus on adoption,
implementation, and diffusion of products and technologies, with little emphasis on
the design, development, and management stages of innovation (Dogruel, 2015).
The question of how journalists learn in the newsroom and how they implement
innovation is still largely ignored by scholars (Porcu, 2017). Besides, the role of
newsroom managers who implement innovation strategies is usually invisible in the
research, and empirical measurements of in-house innovation within the media
industry are scarce (Bleyen et al., 2014). As Weiss and Domingo (2010, p. 1158)
put it, a deeper theoretical framework is needed regarding “the actors, dynamics and
factors involved in the processes, theories that acknowledge the changing nature of
journalism”.
Innovation “combines discovering an opportunity, blueprinting an idea to seize
that opportunity, and implementing that idea to achieve results” (Anthony, 2012,
p. 17). Translated to the media industry, this means that innovation must involve
something more than the repetitive cycle of everyday news production. For this
study, we define journalism innovation as
the capacity to react to changes in products, processes and services using creative skills that
allow a problem or need to be identified, and to be solved through a solution that results in
the introduction of something new that adds value to customers and to the media organization (García-Avilés et al., 2018, p. 27).
The brakes on innovation are mostly cultural, rooted in the newsroom, as systemic
practices and preferred work patterns (Ess, 2014). There is no successful single
recipe of media transformation and adaptation to the new realities: going from
products to services, from hardware to software, and from audience to users includes
changing mindsets, often unlearning the trade and its institutional truths (Storsul &
Krumsvik, 2013). Experimentation produces mixed results on what works and could
work when it comes to creating commercially successful new services and products.
1
I have published the content of this section in the following chapter: García-Avilés, J. A. (2021)
An Inquiry into the Ethics of Innovation in Digital Journalism. In Luengo, M. & Herrera, S. (Eds.)
(2021) News Media Innovation Reconsidered: Ethics and Values in a Creative Reconstruction
of Journalism. Wiley-Blackwell. And it is published here with permission from Wiley-Blackwell.
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J. A. García-Avilés
The individual mindset determines what ideas lead to innovation in the newsroom: “Inventions within a variety of newsroom structures support the general truth
that innovation and change usually start with the ideas of individual creators”
(Gynnild, 2014, p. 720). A holistic perspective on innovation must include the
pre-phase of the innovation process, considering, for example, goal setting, customer
research, or observation of competitors (Dal Zotto & van Kranenburg, 2008). Bleyen
et al. (2014, p. 48) established a typology of media innovations, based on five
categories: production and distribution, business model, media consumption, inner
form, and core product. The first three categories are related to innovation processes,
and the latter two (the inner form and core product) highlight product innovations,
such as a groundbreaking television programme or an original podcast.
We argue for a holistic approach to research media innovation by considering as
many aspects influencing ongoing processes as possible and being aware of the
conflicting tensions that emerge (Virta & Malmelin, 2017). The diffusion of innovations has been researched extensively across diverse disciplines, including the
implementation process as well as key actor categories, such as innovators, early
adopters, and laggards (Rogers, 2003, pp. 243–267). In this regard, Rogers’ model
(2003) highlighted the initiative taken by those individuals who drive innovation
within the company and the role of early adopters who are involved in disseminating
innovations in the market and in society (pp. 248–249).
García-Avilés et al. (2018) examined innovation in the Spanish media to find out
where and how innovation occurred and what kinds of changes it brought about.
According to their findings, most innovations happened in the areas of product/
service, distribution, and interaction with the audience. Most innovative initiatives
were “incremental”: smaller advances or gradual improvements of existing products
or services. A few “radical” innovations took place mostly within online-only sites.
Taking one step further, García-Avilés et al. (2019) analyse how both incremental
and radical innovations are implemented in four main areas of journalism: production, distribution, organisation, and commercialisation. Each respective area has its
own goal: the production of innovative content and formats, improving the distribution channels, innovation in the work structure and newsroom organisation, and
incorporating new sources of income.
20.3
Analysis of Case Studies in Media Innovation
In this chapter, we examine different case studies of news companies in which
management has played a decisive role in leading the process of innovation. We
selected eight prominent case studies of media innovations, according to trade
publications and innovation rankings. A convenience sampling method was used,
relying on secondary data gathered from articles, reports, and published interviews.
This sample represents international case studies of innovative news organisations.
Then, we designed a retrospective study to analyse the elements involved in the
implementation of the various innovations. As shown in Table 20.1, the sample
20
Harnessing Change in a Disruptive Environment: Case Studies in Media. . .
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Table 20.1 Sample of media companies selected for the study
Company
Nexo
Verificado 2018
Country
Brazil
Mexico
Area of innovation
Product
Product
Axel Springer
El Confidencial
Quartz
El Espectador
Germany
Spain
United States
Colombia
Organisation
Organisation
Distribution
Distribution
The
Correspondent
El Diario
The
Netherlands
Spain
Commercialisation
Website
https://www.nexojornal.com.br/
https://verificado.mx/presentacion/?
lang¼en
https://www.axelspringer.com/en/
https://www.elconfidencial.com/
https://qz.com/
https://www.elespectador.com/
noticias/
https://thecorrespondent.com/
Commercialisation
www.eldiario.es
Source: Author
includes news organisations from seven countries (four companies from Europe and
four from the Americas). Two cases studies are from Spain, a market that I know
well, and three others are from Latin America, a market experiencing a fast growth in
media innovations (Schmitz Weiss et al., 2018).
These case studies were grouped according to the four key areas of journalism
innovation: product, organisation, distribution, and commercialisation. We briefly
present the results of the analysis in the next sections, following a similar structure in
each case study: a problem to be solved, the details of how management developed a
specific innovation, and lessons learned from the experience.
20.4
Product Innovation
These innovations relate to the implementation of all kinds of content and the outer
forms and services that usually require both the professionals’ team production and
users’ active participation.
20.4.1
Nexo Jornal: News Products That Provide Context
Problem: Readers need more background and an explanation of the main stories of
the day.
Nexo is a Brazilian digital outlet focusing on explanatory news, which was born
as a multidisciplinary venture, with the aim of innovating in their coverage. Its
newsroom, made up of 30 professionals trained in journalism and other careers,
leaves aside breaking news and concentrates on analysis and explanation through
multimedia, data, and interactive reports, illuminating the public debate. For example, an interactive special report allows readers to test their knowledge about their
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J. A. García-Avilés
municipality; they can find out how many households in the city have access to
sewage, lights, or running water and compare the data with the national average.
Using a database with all the streets in Brazil, Nexo also produced a special report
with text, graphs, and tests, revealing what the names of roads, avenues, and alleys
tell us about the country. It also addresses issues such as gender inequality and points
to streets with references to military dictatorship and even torturers.
Nexo’s journalists do not just want to innovate in their approach to the news; they
also try to choose the best format to tell a story. According to executive editor
Marina Menezes, it is easier for Nexo to innovate by having a small and integrated
team (Estarque, 2017). The research, art, and technology teams work together with
the editorial section, gathering information and developing the best formats for the
stories. The use of data and graphics is a key element of Nexo’s coverage. Unlike
many newsrooms in Brazil, the data team is an independent editorial unit, with its
own news assignments on politics, economics, sports, culture, science, etc. The team
also works on special features, together with designers and developers.
By promoting team collaboration, Nexo’s managers have implemented a successful news production system that seeks readers interested in learning about the
context of the news in Brazil. Within Nexo’s editorial project, the infographics
section intends to improve acc