Should PR and Corp Comm People Have Liablity Insurance

There is an old joke about a doctor who saw a patient and told him that in order to stay healthy he needed to quit drinking, quit smoking and quit eating fatty foods and exercise more. The next time the doctor saw the patient, not only was it obvious he hadn't done any of what he said but had actually gotten worse at it. The doctor, fuming and exasperated asked why the patient hadn't done what he asked. The patient looked at the doctor puzzled and said, "oh were you being serious.?"

Sometimes, when you work in Corp Comm or PR you can see situations like this. If the patient in the case dies from a heart attack most people would say that he had lived an unhealthy life. If you are a PR person, you or your organization has committed a public relations gaffe. Recently, when BP CEO Tony Hayward went sailing while oil surged into the Gulf of Mexico, it was referred to as a PR disaster. OK, first of all, I Mr. Hayward told his PR person what he had planned and then had it approved before he went sailing. Granted, BP has committed more than its share of PR errors which can be attributed to PR but this was not one of them.

Keep in mind that in general when an organization does something stupid or just flat out wrong and then mishandles the response it is often called a PR gaffe. The usual problem is that we're seeing an organization trying to "spin" its way out of trouble. That is they are trying to set the agenda and decide what is, and what isn't, relevant to the discussion.

So what is the solution to this issue? Well there is actually an easy one. It's called telling the truth. Well it's a bit more complex than that. My parents used to call being punished "taking your medicine." A throwback to the days before Nyquil when medicine actually tasted poorly and you had to brace yourself before taking it.

McDonald's is the sign of an organization who took their medicine earlier this year and very quickly the problem was gone. It's amazing how quickly stories enter and exit our news cycle but you may recall that when the most recent Shrek movie was released, McDonald's had some glasses it released as a product tie in to the movie. Of course it turned out that the glasses were tainted with lead. McDonald's quickly issued a recall and about 4 to 6 weeks later the issue has been almost forgotten. They didn't spin, they told the truth, took their medicine and as a result will move forward with little interruption.

So I come back to the issue that made me write this little tome. Should PR and Corp Comm people have liability insurance. Well of course I was being somewhat factitious when I said that, the truth is we don't. What we need to do is remember that our first goal and highest calling is to tell the truth. While lawyers and bean counters think we should "spin" the news the fact remains when an organization listens to them, or has a culture that encourages that, you have a situation like BP. If you encourage the truth and "taking your medicine," you are like McDonald's where only a minor hit disrupts your path to ongoing business success.

Please don't mistake action for strategy!

In the world today where every company seems to fear losing market share and is looking over their shoulder their are two things going on. The first is that some companies are just frozen by fear. Let's call them dear in the headlights and say that they will not be with us long. You can be frozen by fear and expect to last too long. The second type of company is far more interesting and I think worthy of examination.

There are companies who believe that in order to succeed in a business environment they must do something, anything to take that next step. As a result they are taking ill advised short term steps which in the long term will cause far more harm than good and will ultimately result in a weaker brand. The usual scenario with these organizations is that someone in a senior capacity is getting restless and wants something done so he or she can feel better about themselves. This is usually ends up with a useless news release or some silly cutback that does nothing but eliminate an avenue for potential growth.

Senior executives, including the CEO, are by nature a nervous lot and generally speaking only see out one quarter in advance. They also do not see issues of branding or that a long term strategy result in anything because the current obsession is for short term results. Sadly, this leads to long term failure.

One company that proves the point that strategy trumps action is Amazon.com. Several years ago, they gave up on briefing analysts and decided that they wanted to run the organization with goals 5 years out as well as progress marks on the way to those goals. What is most amazing is that this program has been a spectacular success. As you might have guessed, there was a lot of snickering by the so called experts, but the last laugh was by Amazon. Now they can focus on how to fix any problems with their company and don't need to take the myopic view of needing to meet quarterly numbers.

From a marketing stand point this is bliss. Marketing can only succeed in an environment where there is a long term plan and a set of achievable goals. Marketing is about selling goods to the customers, not trying to please the blood suckers on Wall Street who are the greatest road block to a company's success.

So many companies need to reshape how they do business and realize that managing quarter to quarter is in fact counterproductive. It promotes myopic thinking and rewards short term gains while destroying any chance for long term success. Hopefully the success of Amazon will help promote the ideal of managing for long term success but the real agent of change will be when MBA programs learn to value both ethics and a global vision of corporate success. When that happens we may actually see a renaissance in global business.

Why the death of managed earnings is a victory for marketing and communications

There was a story on the news recently that General Electric CEO Jeffery Immelt is recommending the company abandon the practice of issuing earnings statements and trying to manage the company to meet those expectations. Coming from one of the great failures in American business during the last several years, this is indeed welcome news for all marketing and communications people. As people who believe in branding know you can know more manage earnings than you can milk a bull!

Actually by way of a history lesson the concept of managing to earnings started with GE and spread to a host of publicly traded companies like a flesh eating virus. Gone were the concepts of doing what was best for the company in the long term. It was replaced by doing what needed to be done in order to meet the quarterly numbers and as a result the long term success of the company was often compromised. This resulted in all sorts of financial shenanigans which played no small role in our current situation of financial distress.

Hopefully this change of heart, assuming it is both true and lasting, will lead to a return to long term vision which in my opinion has tremendous upside potential for marketing and communications. The two parts of the organization best equipped to deal with issues around branding.

By forgoing a short term vision of the organization, marketing and communications people will be able to do what they do best. Design a program which enhances the brand and allows for the organization to be sharply defined within the marketplace and clearly differentiated from the competition both in the forms of other organizations as well as competing technologies. As we all know marketing and communications is a game of inches and success, or failure, is often measured from the vantage point of time, not a few days.

My greatest hope is that since GE started all this foolishness that they lead a trend towards a more sensible form of management and allow for marketing and communications to emerge into its rightful place as the managers of the brand. A brand takes a great deal of time to build and unfortunately for all the MBA's who think the world runs on their clocks, there is no set amount of time we can tell you for when the brand will mature. In fact I can promise you that much like our economic recovery, it will proceed in fits and starts and may even move in a parallel direction for a period of time. Let's hope CEO's get smart and realize you can not manage earnings but you can invest in a brand and finally let marketing and communications people do their job!

The Beat Beat Goes On

I can't help but wonder what it is like to be the PR manager at GM in these days. I mean if you are at GM corporate it must have been brutal for the past several weeks seeing the writing on the wall and knowing the company was going down in flames. If you were in one of the product lines, you have to have been going crazy seeing how badly GM was planning it's future and developing more big, gas guzzling cars when the market taste was shifting towards more fuel efficient models. Yes GM has filed for bankruptcy and its not quite the end of the world, that's now happening in December 2012 if you're wondering. This will be a painful progress and sadly a number of good people will be hurt by it but sadly it is necessary in this case to cut off the infection to save the patient. My only hope is that we don't see the incompetent managers who lead GM into this position leave with bundles of golden parachutes.

One possible good outcome of this mess is that it could end the second gilded age in America and the idea of the CEO as a god. CEO's are grossly overpaid and in many respects are paid regardless of whether they succeed or fail. Also, their short term, quarter-to-quarter view handcuffs them into pleasing Wall Street and not in pleasing their customers. Last time I checked, Wall Street bought zero for product yet most CEO's behave as if that is the market they most need to appeal to. If you want to see an example of one company doing the right thing look at Amazon. They are among a growing list of companies who refuse to provide guidance to Wall Street and "manage" earnings. Not surprisingly, they tend to be more successful and often have stronger earnings and be more in tune with their own markets.

Well the Red Sox didn't play last night which was a good thing because it was a good night for TV watching. Personally, I think CBS has the best hour of TV between 8 and 9 PM on Monday's with the Big Bang Theory and How I Met Your Mother. The guy who plays Sheldon on Big Bang is one of the funniest characters on TV today and should receive an Emmy nod though I doubt he will. I mean how many years did Friends get those automatic Emmy nod's and it basically sucked. I think the funniest episode of Friends would qualify as a lame episode of How I Met Your Mother and Big Bang. I also watched the first season of Barney Miller on DVD. Barney was one of the best TV shows ever and is still extremely funny to watch even today!

I think it's a shame about the Air France jet but I am not buying the theory of a lighting strike bringing down the plane. What I don't get is that this model of Air Bus is equipped with both satellite and Doppler Radar and if the weather was so bad, why didn't the crew just fly around? The black boxes will keep beeping for 90 days so I hope they find them because I think that's the only way this mystery will be solved.