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140 Corporate Communications in Practice

Box 5.1 Case study: Sara Lee/DE – organizing

communications in a multinational corporation31

Sara Lee/DE, headquartered in Utrecht, the Netherlands, is a subsidiary of Chicago-

based Sara Lee Corporation, and is a global group of branded consumer packaged
goods companies. The DE part of the Sara Lee/DE name goes back to the Douwe
Egberts (DE) brand, a Dutch coffee and tea producer that was taken over by Sara Lee
in 1978. Initially, the situation for the organization that formerly traded under the DE
name changed little through the take-over. But, early in the 1980s, Sara Lee also
acquired the Dutch company Intradel, a household and body care merchant, and
decided to merge this newly acquired company with the existing DE organization.
Having merged these two companies operating in very different sectors, Sara Lee
finally decided in 1989 to change the structure of the newly formed organization.
A corporate holding was established carrying the name Sara Lee/DE with two divisions:
Coffee and Tea, and Household and Body Care. Together, these divisions now (in
2003) encompass around a hundred business units operating in more than 40 countries.
Within this holding structure, responsibilities are devolved to each of these business
units so that local businesses can respond to and meet local market needs in the best
possible way.

SARA LEE CORPORATION

SARA LEE / DE

INTIMATES & UNDERWEAR HOUSEHOLD PRODUCTS FOOD & BEVERAGE

HOUSE HOLD DIRECT
COFFEE & TEA
& BODY CARE SELLING

As a result of the restructuring in 1989 communications responsibilities became

split into a central corporate public relations department at the group level of Sara
Lee/DE, and smaller communications departments and professionals being placed
within the various business units.
The split seemed a logical division of tasks, and is typical for many multinational
corporations, but almost immediately brought clear tensions with it about responsibil-
ities and procedures concerning communications. Particularly in the area of media rela-
tions, managers and professionals from across the organization duly talked with the
press on their own initiative, in the absence of clear procedures for media relations.
These tensions and debates about responsibilities and procedures have since led to
the implementation of two formal initiatives that aim to ensure that the central corpo-
rate public relations department maintains its policy making and coordinating role in
an organization where communications responsibilities are largely decentralized to
the level of the individual business units. The first initiative, supported by the execu-
tive board, is that corporate public relations offers the general strategic framework
for communications to business units. This basically means that the general corpo-
rate strategy of the Sara Lee/DE company is translated into a set of communications
values and procedures by the corporate public relations department, which are then
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The Organization of Communications 141

passed on to communications practitioners within the individual business units. These

practitioners in turn develop their own communications plans, but need to adhere to
these values and procedures. As the chairman of the executive board once said: ‘the
corporate public relations department offers the frame, and professionals within
the business units each deliver a picture for it’. The second formal initiative is that the
corporate public relations department not only supports and counsels the executive
board on organization-wide communications, but also is designated as an internal
consultancy practice that the individual business units can turn to for advice and
assistance. As an internal consultancy, the department operates on a project basis
for communications practitioners in the business units, giving them value-added,
expert communications advice or assisting and helping them with developing and
executing communications plans. The corporate public relations department is, for
this purpose, staffed with three expert consultants (each specializing in an area of
communications) alongside the head of the department, an editor, a production
manager and two personal assistants.
Through these two initiatives, Sara Lee/DE seeks to balance the coordination and
management of communications issues at the central level, at the level of the whole
organization, with its decentralized management structure in which individual busi-
ness units manage their own communications plans. Individual business units are still
responsible for their own communications plans, but these two initiatives are seen to
ensure a greater coordination and collaboration across the organization, which leads
to consistency of communications and a better profiling of the corporation as a whole.

Questions for reflection

1. To what extent are these tensions between a central communications depart-

ment at group level and local communications practitioners at the level of
individual business units typical and therefore generally descriptive of all
multinational corporations? Which multinational corporations fall outside this
characterization?
2. To what extent do you believe Sara Lee/DE has implemented suitable initiatives
to deal with these tensions? What would you have done differently?

The public sector organization. An effective streamlining of communications activities

is just as important to organizations within the public sector as in commercial firms.
The public sector involves many different types of organizations, including national-
ized companies (e.g. utilities), government agencies and departments (e.g. the ministry
of defence), and public service organizations (e.g. hospitals and schools). The larger
organizations in the public sector (as opposed to, for instance, small government
agencies) traditionally have a strong presence close to senior management and
policy making of ‘public’ communications disciplines (e.g. media relations, publicity)
that are used to inform the general public, and traditionally little marketing
communications.This is a result of the direct or indirect control or influence exercised
from outside the organization by government in particular.With budgets being allo-
cated by government and missions imposed, there was traditionally little incentive for
public organizations to develop extensive marketing programmes, let alone think in
marketing terms about the products and services that they deliver. But, increasingly,