Given recent and pending changes in U.S. trade policy, possible changes in access to capital, and the volatility on the Street, it’s not surprising that many organizations are contemplating a change or two in their overall strategic direction. Whether current market conditions have you rethinking your company’s future, or you’re shifting gears due to your specific industry or business dynamics, it’s essential to keep your investors in the loop. This is true regardless of how big (a new acquisition, divestiture or major diversification) or small (shift in sourcing strategy, change in management, or expanding a product line) that planned change may be.

Whatever’s on the horizon, it’s a good idea to create a communication roadmap, so that you have a plan in place to share important information with investors along the way. While the investment community does not expect you to know all the tactics underlying the execution of your change this early in the game, they do want to see the big picture and your high-level plan for getting from point A to point B. More importantly, they want to understand the opportunity—why you’re making the change. And they want to know that you’ve thought through and done your due diligence to mitigate any risks involved and to control (as much as possible) the intended outcome.

That’s where a communications roadmap can help. It allows you to give a snapshot of your plan, its timeframe, key milestones, and ultimate objective. And it helps you anticipate investors’ key questions and address them in ways that build confidence and show you’re in control of the plan each step of the way.

As you start building your roadmap, here are a few considerations to keep in mind:

  • Build your roadmap within the context of opportunity and risk. When you’re shifting strategy, your investors’ two biggest questions are going to be why (what’s the opportunity?) and why not (what’s the risk?). Your plan needs to be built upon a solid foundation or rationale that carefully considers these two points and that is as transparent as possible.

First, you’ll need to clearly demonstrate that the market supports your strategy. For example, if your business is about to shift into growth mode and take its core competencies into new regions or geographies, build the case for why, and why now. Show the need in that market, how the need is growing, and why it’s important to seize the opportunity while it’s ripe. Second, you need to illustrate that you’re thinking about and controlling the risks. You must show that you have the assets, executive talent, and operational knowledge to make your plan happen without taking on meaningful risk.

  • Highlight the end game. Your roadmap needs to emphasize the ultimate objective of the shift in strategy and why it makes sense for the business and its investors. Show how it fits in and supports the company’s vision, and talk to what it means for investors in terms of returns and the value it will bring today and down the road. Be sure to reiterate the sustainability of the new strategy and how the change will benefit the company and investors long-term.
  • Make sure your IRO is well-briefed from the start. The person or team responsible for communicating with your investors needs to understand the shift in corporate strategy as it is evolving. To communicate effectively, they need to know the whole story and all its nuances and complexities, so they can later break it down into meaningful messaging for investors and analysts.

This early involvement is imperative to ensuring consistent messaging. It also helps keep the messaging on point. The IRO can bring important perception study feedback to the conversation to illustrate how investors are likely to respond to the shift in strategy. Is it something your investor base has been asking for and will accept immediately? Or will investors be biased against your plans and need additional education to understand management’s viewpoint? Either way, this insight will help shape the communications plan—both what you need to say, and when you need to say it.

  • Include checkpoints and milestones to monitor progress. If the shift will happen in tranches or over time, provide a rough timeline to communicate to investors what they can expect to happen when. Include both short and long-term milestones on your roadmap to illustrate the path to your ultimate goal or vision. Discuss how you will measure success and share with investors the KPIs you will be tracking along the way, as well as your projections for these metrics, if possible.
  • Plan on regular updates and stick to them. Depending on the timeline for your strategy shift, quarterly earnings calls are likely an ideal time to make progress reports to your investor community. Let your investors know this is when they can expect updates, and follow through on your commitment, even if progress is slower than planned or unexpected headwinds occur. No matter how you are progressing, make sure your management team is always aligned around messaging, especially before these critical updates. The team should spend time anticipating investors’ questions and be well-prepared to answer questions and provide a unified perspective to investors.

It’s a journey, not just a destination.
Shifts in corporate strategy, even small ones, take time to execute. It’s critical to keep the conversation with your investors going, and to keep them engaged, for the entire ride. Carefully planning out your roadmap and the specific messaging for each phase and milestone will go a long way in building and maintaining investor confidence throughout the process while keeping your management team aligned and on track. For more ideas or advice on how to put your communications plan and roadmap together, connect with Clermont Partners today.