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Managing the public relations firm in the 21st century
D a n i e l J. EdelmanfFarley Manning Fellowship Address
Managing the Public Relations Firm In The 21st Century hz this, the 1983 Farley Manning Fellowship Address, Daniel J. Edehnan reports on his own view of the future and those of others he surveyed in preparation for composing this Address. "'Upward mobility"--of individuals in public relations and of tire profession as a whole--will be a key emphasis among those with management oversight in public relations firms, he predicts. Upgrading training with formal programs, making employee and client recruitment more effective by making it more sophisticated, and staying abreast of state-ofthe-art communications technology--all of these will be important factors in managing the next century" s public relations organization. Tire author is the president of Daniel ]. Edehnan, Inc., with offices in Chicago, New York, Washington, Los Angeles, Miami, St. Louis, London and Frankfurt.
y
our committee couldn't have made me happier than to give me an assignment on the subject of "Managing the Public Relations Firm in the 21st Century." What an incentive for someone who's going to be an octogenarian as that century d a w n s - - i f the pressures of this business don't catch up with me first! I'm honored to have been selected to respond to the challenge Farley Manning set forth for us. I've had the privilege of knowing Farley for many years. I've admired him as a public relations professional, a gentleman, a man of intelligence--a top competitor who, at the same time, could be a friend. Since all wisdom and creativity in our field doesn't flow from Daniel J. Edelman, Inc.--despite claims that we might make to prospective clients-we decided to surv.ey counseling firm managers to determine h o w they view the future in terms of running the public relations firm. 3
Public Relations Re~4ew We randomly selected about 75 firms from all parts of the country, sampiing large, middle-sized and small firms. We asked executives for their insights on current and anticipated trends in eight key areas: program, services, technology, agency structure, account management, recruitment, billing and the structure of operations. The survey was quantitative, but there was an opportunity to include subjective comments. I'm pleased we had a 42 percent response rate.
In making this talk on managing the public relations agency, I have to admit it's almost ironic that I became a businessman at all. Like most of you, I started out as anything but. Everyone in my family was a professional. My father practiced law for 50 years. My oldest brother became a doctor and m y other brother a lawyer. As I've often said, I was the Indian chief, which I guess could be a euphemism for public relations executive. I always had some tugs between doing it and reporting about it. But when push came to shove, I moved on to journalism school. And with that background, and some newspaper experience, I went into U.S. Army psychological warfare and the Information Control Division in World War II. When I returned in the mid-1940s after a brief stint at CBS, I just moved naturally into public relations. Based on my background, I guess I've always approached my work as a professional, putting the client's needs first. To learn about selling was a true exercise in discipline. So was meeting a payroll. Even worse was deciphering income statements and balance sheets. Here I must acknowledge the invaluable contribution of Betsy Plank, who worked with me for 10 years before going on to Illinois Bell. I think the proprietors in this room have already found the special satisfactions that come from running your own business. You have more control. You can make plans and see them through and observe the results--for better or for worse. And you more or less do it on your own. You don't have a lot of reporting levels and you don't have to sell others on your viewpoint. You just plunge right ahead. And probably most appealing is the fact that you can be the entrepreneur. You can maximize financial results. You can also "freewheel." You can be flexible. You can change your mind quickly. But every one of you who runs a public relations firm knows the disadvantages, too. It's a risky operation. It's very competitive. There's little security. You certainly work much harder. You've got to out-think, outhustle and out-work the next guy. There's never enough time. And of course, as you grow and hire others, you just can't expect that they'll have the same feeling of belonging to a crusade. You'll find a heavy burden on your shoulders. That means working and worrying seven days and many nights every week. And that takes a toll on family life, on time for the children and time for your spouse and time for vacation trips. The business is a lifestyle, there's no way of getting around it.
Mana~in~ P R Firms I know that each of you has experienced both the joys and sorrows I've 'just mentioned. As the business g r o w s - - w h e t h e r from one person and a secretary to a half dozen, or from a half dozen to 20, or from 20 to 100 or more, it remains a small business. We begin, however, to get into some of the chaIIenges faced b y the large corporations. A n d the key soon becomes dependence on others. It means we must do a good job of recruiting. It means we have to train. It means we have to accept relying on others to get the job done. It means we have to become expert at supervision--at walking that fine line between trying to do it all--trying to dominate and direct--and on the other hand, leaving too much to associates w h o may not have enough experience to do the job properly. No matter h o w far we progress toward sophisticated management development or toward utilization of modern technological tools, ours will always be a "people" business. The ultimate factor determining the extent to which we succeed will be the quality of the people we recruit and how we bring them along to an increasing amount of responsibility. In short, it will be our ability to establish a proper balance between over-managingand under-
managing. As you are all aware, "public relations" is a term in common usage today. Everyone talks about it but nearly always in a distorted way; the misuse of the term only makes the problem worse. The poor image of public relations inhibits our ability to attract the best people. We have to prove by our performance that public relations is not a devious kind of work, a covering up, a cosmeticizing or distortion of reality. As we eliminate that erroneous image, w e will be better able to attract the kind of professionals we need. In turn, as they come into the field, the image of public relations will improve. Our people are the key to what we have to sell. As with any product, we must continue to maintain and to upgrade their quality. Over a period of time, they make our firms strong or weak, outstanding or average. For most of us, recruitment is more an art than a science. The manner of bringing in people to our firms is still quite primitive. I submit that a prime point in our preparation for the 21st century will involve a commitment on all of our parts to initiate programs designed to bring in the best available talent. I think it's important for us to reach into the schools that offer public relations courses, and to work with the PRSSA graduates. We need employees with journalism training and also the skills offered by business schools: strategy, finance and management techniques. These types of students represent a cadre of young men and w o m e n already committed to public relations--and trained in its basic skills. I think y o u would all agree that we have to reach out to identify specialists from many different disciplines w h o can provide a superior range of services to our clients. We must also continue to attract specialists from other fields
Public Relations
Re~tew
who already have had work experience in their areas of specialization. Anti once we bring them in, we have to train them properly, whether they are newcomers fresh from college or graduate school, or more senior people. In m y view, too much of our training is a "seat-of-the-pants" affair. In the long run, learning by doing is the best way to become a professional, but w e can accelerate the process. We can insure that new people become adjusted to the field and to the unique corporate style in each of our companies if we provide a regular training program. Maybe it's possible for the Counselors' Academy to work out formal training programs as well. The training program should be directed by our senior people and ourselves. It should cover all aspects of public relations activity. We must provide an atmosphere of professionalism and intellectual challenge by continuing education on the job, through internal seminars and by participation in seminars such as this one. This will enable new people to provide professional counseling to clients sooner and to do so more effectively. We must provide a climate in our firms that makes internal advancement possible. "Upward mobility" is crucial to the retention of the well-educated, well-trained, ambitious people we have, who will build our firms and also enhance our profession. We have to accord our people the same level of professional recognition given to young lawyers, accountants, management consultants and business executives, and we must provide the financial rewards that will help attract and hold the best prospects. We also must provide opportunities for growth on the part of newer people. We have to find a way of expanding the role of key senior people so we can arrange to give larger responsibilities to younger people. They must advance in our firms or they'll be looking elsewhere. I suggest that we must continually identify those people who are clearly on a fast track and enable them to move forward in responsibility and in compensation, giving them every opportunity to fulfill their potential in our companies. In looking toward the years ahead, we must be sure we can keep up with the times and offer specialized services to our clients, such as media tours, media training, attitudinal/audience research and TV placement, plus cable/ film/video production. We need to keep close to changes in the media. We can't avoid the old bugaboo--measurement, clearly one of the greatest needs of our profession. It's going to be up to us to find the objective standards of testing that are essential to satisfy the persistent demands of clients for real answers in this area. The Publicity Tracking Model System developed by Ketchum is a way of measuring gross impressions and the extent to which the key message is communicated. It seems to me it's just a beginning in our search for measurement tools. Public relations is more than a matter of how many clippings appear and what they say. Even within the restricted area of publicity per se, this system is not sufficient. I've had experiences where a single story in a particular publication has made all the difference for the prospects of a certain enterprise. That's only one story in only one publication. How 6
Mana~tng PR Firms would it be measured on the Publicity Tracking Model? Yet anyone looking at the situation accurately years later had to know that his story was the turning point for the company involved. And h o w would you measure the results in public affairs or crisis counseling? You have your back to the wall w h e n a program is initiated; it takes strategy, creative thinking, government relations, client counseling and meetings with consumer groups, plus media work, to get your story across. We've lived through the automotive protection pressures, health cost containment, the Concorde airplane, the arms embargo on Turkey, the Nestl6 infant formula boycott, Love Canal. Nobody could track our contribution with even the most sophisticated computer techniques. Currently we're exploring new concepts in measurement in tandem with two different business schools. Billing is a sensitive and crucial area of management. We should bill fairly, but we should not sell ourselves cheap. We must charge fees that assure proper compensation for the value of our professional staff time and services. This is a time to be very careful on extending credit. One counselor told me even one of America's premier organizations is four months behind on paying its bills. We've been burned badly this year; we experienced the bankruptcy of a video games software supplier who owed us a large sum in production expenses and fees. Get cash ahead for expenses, if not fees, in dealing with any situation that is financially questionable. I urge you to keep retained earnings in your company if you can; of course, this depends on whether your corporate structure allows it. It's important to have a nest egg available for investment in new equipment, to bring in a good person w h e n one comes along, or to make an acquisition. There isn't any single answer in terms of growth possibilities. I've always said that the smaller firm can do extremely well with a team of six or 10 or a dozen people on staff. I think there will always be a need for public relations counsel through that kind of firm. The drawbacks are that so much depends on the principal. It's hard for him to get away from client service, even to take a vacation, without being concerned that things are going to fall between the cracks. The advantages, of course, are total control of his own destiny and the opportunity to do very well financially. I suspect there will continue to be mergers of local firms with larger ones. And I'm sure there will be more mergers within given cities. What about ad agency mergers? O ' D w y e r shows that seven of the top 10 firms in our field now are part of major advertising agencies. I have some personal reservations about this development because I believe that, in some respects, it undermines the individuality, the uniqueness and the special role in our society of the public relations firm. At the moment, it would appear that there have been many benefits to those public relations firms that have become part of large advertising agencies: availability of finances for acquisitions of offices or people; services 7
Public Relations
Review
such as research, creative, art and design; and new business because of an introduction through the advertising agency personnel. For public relations principals nearing retirement, it's the w a y to realize substantial financial gain and assure continuing security for their employees. There's no doubt the trend will continue. But at the same time, I feel that in the long run, those w h o remain independent will derive substantial benefits, too. There will be greater opportunities for independent public relations firms to represent clients who do not want both services coming from a single source. And ad agencies without public relations departments will recommend independent firms. I see a counter-force in the years ahead with gains for the independents. Walking around the exhibits at the last PRSA conference in San Francisco, I was impressed to note the extent to which our field has moved into the computer age. I would suggest that the tools now available be explored by every firm, large and small, if we're to keep up with the state of the art. Of all the questions asked on our survey, the one on technological aids/ advances could not have produced more nearly unanimous results. There is no question that this is the area of change, growth and potential for us over the next decades. One hundred percent of the respondents documented the increase in the importance and use of word processing; videoconferencing; computer-assisted data retrieval; data phone services; teleconferencing; satellite transmission of video releases; and, to some degree, rapidom and electronic mail. Our respondents felt all these will be relied on with increasing frequency over the next decades, replacing the telex and even the telecopier and other means of communication as we know them nosY.
Our business is becoming more sophisticated. We all must make sure that we're tuned in on what's available and that we bring to our operations the most efficient equipment that will help us do a better job for clients, as well as for ourselves. A very important management consideration in the coming years relates to whether every prospective client is entitled to representation. Is it appropriate for one of our firms to represent South Africa, the Philippines, or Argentina? Should we be influenced by the finances available in taking an assignment? My o w n recommendation in this regard is that the question should be whether we're going to be able to influence zohat's being done, not just what's being said about what's being done. If we can make a truecontribution in terms affecting the actions, then I'd say it's appropriate for us to take on even the most unpopular clients. But if we're strictly there to try to put a pretty image on a nasty situation, we'd better stay away from it. Another favorite bull session topic among counselors is competitive presentations. Today they're a fact of life. There's no use crusading against them now, or taking the hard-nosed view that you're only going to tell your capabilities and won't develop a creative proposal for a prospective client. 8
Mana~in~ PR Firms Internationalization is a fact of life in our business. In the years ahead there will be growing interrelationships between the countries in the Western world. It may not be necessary for every one of your companies to have affiliates in London or Paris or Tokyo. But I do think you should bear in mind that nearly every national company with which you may be working is in business one w a y or the other in Canada, in Europe, and in the Far East and South America. You must be able to provide them, as they're needed, with services in s o m e of those countries. Moreover, it's clear that as the years go on, opportunities will arise in these other countries for which y o u can provide service in the United States. Above all, I hope we will all maintain high standards. If we work hard ourselves, if we are truly involved in serving the best interests of the client, if we enjoy what we're doing, if we make sure that we give the client more than the value received for his investment with us, then we're going to do good work for the client and we'll set an example for our people that will elevate their o w n self-image and encourage them to do likewise. The principal establishes the corporate culture; he sets the pattern for the operation. If he does things right, the chances are that the entire organization will follow in his footsteps. Also, we must always strive to broaden our personal exposure to what's happening around us. It is extremely important for personal fulfillment and to enable us to do a better job for our clients. We have to be broad-based thinkers, not just technicians. We should take a leadership position in the political field, in educational institutions, hospitals, symphonies, art museums, and so forth. We have to continue to read and go to the theater and socialize. Of course, there is a pragmatic benefit here: exposure to potential clients. But beyond that, these kinds of experiences enable us to learn to interact with others and to make ourselves better, more sensitive, more involved people. To me, a key to success is professional pride. Let's eliminate the hangdog feeling about being in public relations. We're no longer second-class citizens, if we ever really were. We're educated, with backgrounds in business, history, economics, political science, the arts. In my view, we're in a real profession. We don't have to hide behind euphemisms like "public affairs" or "communications." We're needed. We're a solid part of corporate life and the social structure. We do make a tangible contribution, yet the old prejudices and misconceptions persist. As a manager, take it as one of your responsibilities to act in a w a y that builds respect. At the same time, seize every opportunity to counteract negative statements about the profession. Participate in efforts to help elevate the reputation of public relations by explaining what it is that we d o - - i n speeches, in writing, and in casual conversation in business and social settings. 9
Public Relations Re~tew
I call on you as professional counselors to take a leadership position in the field. It's essentially going to be up to us to do the creative and pioneering work, to set the stage for the growth of public relations in the decades ahead. Let's not play the safe secondary role and let's not take a back seat to public relations directors of companies or other institutions, whether they're clients, prospects or professional peers. We must perceive that the new ways of doing things will originate largely in public relations firms, not in the public relations departments. The potential of our contributions to our clients' future--and hence to our o w n - - i s vast. We provide critical Support in a wide variety of areas that affect significantly the success, growth, and public understanding and acceptance of our clients' policies, their products and their actions. Our counseling is needed in marketing, public affairs, employee relations, investor relations, corporate image and government relations. We are leaders in helping clients make decisions that will determine how they will fare in the public interest and the public mind. Our ability to be recognized for our contributions will determine our own prospects. I feel it's the responsibility of each of us to continue to emphasize the need for outside public relations counsel. In dealing with our clients, we must seek to position our role properly. Let's emulate the law, accounting and related fields in which the major responsibility--the tough jobs--are handled by the outside professionals--with day-to-day tasks assigned to internal departments. And as we succeed in firming up our primary role, let's be sure we also get across the point that our services are worth fees commensurate with those paid to these other professional services.
10
Managing the Public Relations Firm In The 21st Century hz this, the 1983 Farley Manning Fellowship Address, Daniel J. Edehnan reports on his own view of the future and those of others he surveyed in preparation for composing this Address. "'Upward mobility"--of individuals in public relations and of tire profession as a whole--will be a key emphasis among those with management oversight in public relations firms, he predicts. Upgrading training with formal programs, making employee and client recruitment more effective by making it more sophisticated, and staying abreast of state-ofthe-art communications technology--all of these will be important factors in managing the next century" s public relations organization. Tire author is the president of Daniel ]. Edehnan, Inc., with offices in Chicago, New York, Washington, Los Angeles, Miami, St. Louis, London and Frankfurt.
y
our committee couldn't have made me happier than to give me an assignment on the subject of "Managing the Public Relations Firm in the 21st Century." What an incentive for someone who's going to be an octogenarian as that century d a w n s - - i f the pressures of this business don't catch up with me first! I'm honored to have been selected to respond to the challenge Farley Manning set forth for us. I've had the privilege of knowing Farley for many years. I've admired him as a public relations professional, a gentleman, a man of intelligence--a top competitor who, at the same time, could be a friend. Since all wisdom and creativity in our field doesn't flow from Daniel J. Edelman, Inc.--despite claims that we might make to prospective clients-we decided to surv.ey counseling firm managers to determine h o w they view the future in terms of running the public relations firm. 3
Public Relations Re~4ew We randomly selected about 75 firms from all parts of the country, sampiing large, middle-sized and small firms. We asked executives for their insights on current and anticipated trends in eight key areas: program, services, technology, agency structure, account management, recruitment, billing and the structure of operations. The survey was quantitative, but there was an opportunity to include subjective comments. I'm pleased we had a 42 percent response rate.
In making this talk on managing the public relations agency, I have to admit it's almost ironic that I became a businessman at all. Like most of you, I started out as anything but. Everyone in my family was a professional. My father practiced law for 50 years. My oldest brother became a doctor and m y other brother a lawyer. As I've often said, I was the Indian chief, which I guess could be a euphemism for public relations executive. I always had some tugs between doing it and reporting about it. But when push came to shove, I moved on to journalism school. And with that background, and some newspaper experience, I went into U.S. Army psychological warfare and the Information Control Division in World War II. When I returned in the mid-1940s after a brief stint at CBS, I just moved naturally into public relations. Based on my background, I guess I've always approached my work as a professional, putting the client's needs first. To learn about selling was a true exercise in discipline. So was meeting a payroll. Even worse was deciphering income statements and balance sheets. Here I must acknowledge the invaluable contribution of Betsy Plank, who worked with me for 10 years before going on to Illinois Bell. I think the proprietors in this room have already found the special satisfactions that come from running your own business. You have more control. You can make plans and see them through and observe the results--for better or for worse. And you more or less do it on your own. You don't have a lot of reporting levels and you don't have to sell others on your viewpoint. You just plunge right ahead. And probably most appealing is the fact that you can be the entrepreneur. You can maximize financial results. You can also "freewheel." You can be flexible. You can change your mind quickly. But every one of you who runs a public relations firm knows the disadvantages, too. It's a risky operation. It's very competitive. There's little security. You certainly work much harder. You've got to out-think, outhustle and out-work the next guy. There's never enough time. And of course, as you grow and hire others, you just can't expect that they'll have the same feeling of belonging to a crusade. You'll find a heavy burden on your shoulders. That means working and worrying seven days and many nights every week. And that takes a toll on family life, on time for the children and time for your spouse and time for vacation trips. The business is a lifestyle, there's no way of getting around it.
Mana~in~ P R Firms I know that each of you has experienced both the joys and sorrows I've 'just mentioned. As the business g r o w s - - w h e t h e r from one person and a secretary to a half dozen, or from a half dozen to 20, or from 20 to 100 or more, it remains a small business. We begin, however, to get into some of the chaIIenges faced b y the large corporations. A n d the key soon becomes dependence on others. It means we must do a good job of recruiting. It means we have to train. It means we have to accept relying on others to get the job done. It means we have to become expert at supervision--at walking that fine line between trying to do it all--trying to dominate and direct--and on the other hand, leaving too much to associates w h o may not have enough experience to do the job properly. No matter h o w far we progress toward sophisticated management development or toward utilization of modern technological tools, ours will always be a "people" business. The ultimate factor determining the extent to which we succeed will be the quality of the people we recruit and how we bring them along to an increasing amount of responsibility. In short, it will be our ability to establish a proper balance between over-managingand under-
managing. As you are all aware, "public relations" is a term in common usage today. Everyone talks about it but nearly always in a distorted way; the misuse of the term only makes the problem worse. The poor image of public relations inhibits our ability to attract the best people. We have to prove by our performance that public relations is not a devious kind of work, a covering up, a cosmeticizing or distortion of reality. As we eliminate that erroneous image, w e will be better able to attract the kind of professionals we need. In turn, as they come into the field, the image of public relations will improve. Our people are the key to what we have to sell. As with any product, we must continue to maintain and to upgrade their quality. Over a period of time, they make our firms strong or weak, outstanding or average. For most of us, recruitment is more an art than a science. The manner of bringing in people to our firms is still quite primitive. I submit that a prime point in our preparation for the 21st century will involve a commitment on all of our parts to initiate programs designed to bring in the best available talent. I think it's important for us to reach into the schools that offer public relations courses, and to work with the PRSSA graduates. We need employees with journalism training and also the skills offered by business schools: strategy, finance and management techniques. These types of students represent a cadre of young men and w o m e n already committed to public relations--and trained in its basic skills. I think y o u would all agree that we have to reach out to identify specialists from many different disciplines w h o can provide a superior range of services to our clients. We must also continue to attract specialists from other fields
Public Relations
Re~tew
who already have had work experience in their areas of specialization. Anti once we bring them in, we have to train them properly, whether they are newcomers fresh from college or graduate school, or more senior people. In m y view, too much of our training is a "seat-of-the-pants" affair. In the long run, learning by doing is the best way to become a professional, but w e can accelerate the process. We can insure that new people become adjusted to the field and to the unique corporate style in each of our companies if we provide a regular training program. Maybe it's possible for the Counselors' Academy to work out formal training programs as well. The training program should be directed by our senior people and ourselves. It should cover all aspects of public relations activity. We must provide an atmosphere of professionalism and intellectual challenge by continuing education on the job, through internal seminars and by participation in seminars such as this one. This will enable new people to provide professional counseling to clients sooner and to do so more effectively. We must provide a climate in our firms that makes internal advancement possible. "Upward mobility" is crucial to the retention of the well-educated, well-trained, ambitious people we have, who will build our firms and also enhance our profession. We have to accord our people the same level of professional recognition given to young lawyers, accountants, management consultants and business executives, and we must provide the financial rewards that will help attract and hold the best prospects. We also must provide opportunities for growth on the part of newer people. We have to find a way of expanding the role of key senior people so we can arrange to give larger responsibilities to younger people. They must advance in our firms or they'll be looking elsewhere. I suggest that we must continually identify those people who are clearly on a fast track and enable them to move forward in responsibility and in compensation, giving them every opportunity to fulfill their potential in our companies. In looking toward the years ahead, we must be sure we can keep up with the times and offer specialized services to our clients, such as media tours, media training, attitudinal/audience research and TV placement, plus cable/ film/video production. We need to keep close to changes in the media. We can't avoid the old bugaboo--measurement, clearly one of the greatest needs of our profession. It's going to be up to us to find the objective standards of testing that are essential to satisfy the persistent demands of clients for real answers in this area. The Publicity Tracking Model System developed by Ketchum is a way of measuring gross impressions and the extent to which the key message is communicated. It seems to me it's just a beginning in our search for measurement tools. Public relations is more than a matter of how many clippings appear and what they say. Even within the restricted area of publicity per se, this system is not sufficient. I've had experiences where a single story in a particular publication has made all the difference for the prospects of a certain enterprise. That's only one story in only one publication. How 6
Mana~tng PR Firms would it be measured on the Publicity Tracking Model? Yet anyone looking at the situation accurately years later had to know that his story was the turning point for the company involved. And h o w would you measure the results in public affairs or crisis counseling? You have your back to the wall w h e n a program is initiated; it takes strategy, creative thinking, government relations, client counseling and meetings with consumer groups, plus media work, to get your story across. We've lived through the automotive protection pressures, health cost containment, the Concorde airplane, the arms embargo on Turkey, the Nestl6 infant formula boycott, Love Canal. Nobody could track our contribution with even the most sophisticated computer techniques. Currently we're exploring new concepts in measurement in tandem with two different business schools. Billing is a sensitive and crucial area of management. We should bill fairly, but we should not sell ourselves cheap. We must charge fees that assure proper compensation for the value of our professional staff time and services. This is a time to be very careful on extending credit. One counselor told me even one of America's premier organizations is four months behind on paying its bills. We've been burned badly this year; we experienced the bankruptcy of a video games software supplier who owed us a large sum in production expenses and fees. Get cash ahead for expenses, if not fees, in dealing with any situation that is financially questionable. I urge you to keep retained earnings in your company if you can; of course, this depends on whether your corporate structure allows it. It's important to have a nest egg available for investment in new equipment, to bring in a good person w h e n one comes along, or to make an acquisition. There isn't any single answer in terms of growth possibilities. I've always said that the smaller firm can do extremely well with a team of six or 10 or a dozen people on staff. I think there will always be a need for public relations counsel through that kind of firm. The drawbacks are that so much depends on the principal. It's hard for him to get away from client service, even to take a vacation, without being concerned that things are going to fall between the cracks. The advantages, of course, are total control of his own destiny and the opportunity to do very well financially. I suspect there will continue to be mergers of local firms with larger ones. And I'm sure there will be more mergers within given cities. What about ad agency mergers? O ' D w y e r shows that seven of the top 10 firms in our field now are part of major advertising agencies. I have some personal reservations about this development because I believe that, in some respects, it undermines the individuality, the uniqueness and the special role in our society of the public relations firm. At the moment, it would appear that there have been many benefits to those public relations firms that have become part of large advertising agencies: availability of finances for acquisitions of offices or people; services 7
Public Relations
Review
such as research, creative, art and design; and new business because of an introduction through the advertising agency personnel. For public relations principals nearing retirement, it's the w a y to realize substantial financial gain and assure continuing security for their employees. There's no doubt the trend will continue. But at the same time, I feel that in the long run, those w h o remain independent will derive substantial benefits, too. There will be greater opportunities for independent public relations firms to represent clients who do not want both services coming from a single source. And ad agencies without public relations departments will recommend independent firms. I see a counter-force in the years ahead with gains for the independents. Walking around the exhibits at the last PRSA conference in San Francisco, I was impressed to note the extent to which our field has moved into the computer age. I would suggest that the tools now available be explored by every firm, large and small, if we're to keep up with the state of the art. Of all the questions asked on our survey, the one on technological aids/ advances could not have produced more nearly unanimous results. There is no question that this is the area of change, growth and potential for us over the next decades. One hundred percent of the respondents documented the increase in the importance and use of word processing; videoconferencing; computer-assisted data retrieval; data phone services; teleconferencing; satellite transmission of video releases; and, to some degree, rapidom and electronic mail. Our respondents felt all these will be relied on with increasing frequency over the next decades, replacing the telex and even the telecopier and other means of communication as we know them nosY.
Our business is becoming more sophisticated. We all must make sure that we're tuned in on what's available and that we bring to our operations the most efficient equipment that will help us do a better job for clients, as well as for ourselves. A very important management consideration in the coming years relates to whether every prospective client is entitled to representation. Is it appropriate for one of our firms to represent South Africa, the Philippines, or Argentina? Should we be influenced by the finances available in taking an assignment? My o w n recommendation in this regard is that the question should be whether we're going to be able to influence zohat's being done, not just what's being said about what's being done. If we can make a truecontribution in terms affecting the actions, then I'd say it's appropriate for us to take on even the most unpopular clients. But if we're strictly there to try to put a pretty image on a nasty situation, we'd better stay away from it. Another favorite bull session topic among counselors is competitive presentations. Today they're a fact of life. There's no use crusading against them now, or taking the hard-nosed view that you're only going to tell your capabilities and won't develop a creative proposal for a prospective client. 8
Mana~in~ PR Firms Internationalization is a fact of life in our business. In the years ahead there will be growing interrelationships between the countries in the Western world. It may not be necessary for every one of your companies to have affiliates in London or Paris or Tokyo. But I do think you should bear in mind that nearly every national company with which you may be working is in business one w a y or the other in Canada, in Europe, and in the Far East and South America. You must be able to provide them, as they're needed, with services in s o m e of those countries. Moreover, it's clear that as the years go on, opportunities will arise in these other countries for which y o u can provide service in the United States. Above all, I hope we will all maintain high standards. If we work hard ourselves, if we are truly involved in serving the best interests of the client, if we enjoy what we're doing, if we make sure that we give the client more than the value received for his investment with us, then we're going to do good work for the client and we'll set an example for our people that will elevate their o w n self-image and encourage them to do likewise. The principal establishes the corporate culture; he sets the pattern for the operation. If he does things right, the chances are that the entire organization will follow in his footsteps. Also, we must always strive to broaden our personal exposure to what's happening around us. It is extremely important for personal fulfillment and to enable us to do a better job for our clients. We have to be broad-based thinkers, not just technicians. We should take a leadership position in the political field, in educational institutions, hospitals, symphonies, art museums, and so forth. We have to continue to read and go to the theater and socialize. Of course, there is a pragmatic benefit here: exposure to potential clients. But beyond that, these kinds of experiences enable us to learn to interact with others and to make ourselves better, more sensitive, more involved people. To me, a key to success is professional pride. Let's eliminate the hangdog feeling about being in public relations. We're no longer second-class citizens, if we ever really were. We're educated, with backgrounds in business, history, economics, political science, the arts. In my view, we're in a real profession. We don't have to hide behind euphemisms like "public affairs" or "communications." We're needed. We're a solid part of corporate life and the social structure. We do make a tangible contribution, yet the old prejudices and misconceptions persist. As a manager, take it as one of your responsibilities to act in a w a y that builds respect. At the same time, seize every opportunity to counteract negative statements about the profession. Participate in efforts to help elevate the reputation of public relations by explaining what it is that we d o - - i n speeches, in writing, and in casual conversation in business and social settings. 9
Public Relations Re~tew
I call on you as professional counselors to take a leadership position in the field. It's essentially going to be up to us to do the creative and pioneering work, to set the stage for the growth of public relations in the decades ahead. Let's not play the safe secondary role and let's not take a back seat to public relations directors of companies or other institutions, whether they're clients, prospects or professional peers. We must perceive that the new ways of doing things will originate largely in public relations firms, not in the public relations departments. The potential of our contributions to our clients' future--and hence to our o w n - - i s vast. We provide critical Support in a wide variety of areas that affect significantly the success, growth, and public understanding and acceptance of our clients' policies, their products and their actions. Our counseling is needed in marketing, public affairs, employee relations, investor relations, corporate image and government relations. We are leaders in helping clients make decisions that will determine how they will fare in the public interest and the public mind. Our ability to be recognized for our contributions will determine our own prospects. I feel it's the responsibility of each of us to continue to emphasize the need for outside public relations counsel. In dealing with our clients, we must seek to position our role properly. Let's emulate the law, accounting and related fields in which the major responsibility--the tough jobs--are handled by the outside professionals--with day-to-day tasks assigned to internal departments. And as we succeed in firming up our primary role, let's be sure we also get across the point that our services are worth fees commensurate with those paid to these other professional services.
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