I picked up the biography of Samuel Insull, a utility magnate from the early 1900s, to read over Christmas break. An immigrant from the UK in the late 1800s, he was able to work his way into the offices of Thomas Edison, ultimately becoming his chief of staff. He was a larger than life figure in turn of the century Chicago, leaving behind the local utility, Commonwealth Edison, and the giant office tower that also houses the Lyric Opera. He retired in disgrace in the early 1930s, having foolishly leveraged up his company to ward off a hostile bidder.
Students of PR should take heed of Mr. Insull as an early supporter of public relations. He understood that utilities that were, by their nature, local monopolies, had to explain their business model to stakeholders. Consider this comment by Insull: “I care not how good may be the franchises under which you operate, how able may be the management of your property or how good may be your engineers and how perfect your plants. Unless you can so conduct your business as to get the good will of the community in which you are working, you might just as well shut up shop and move away.”
He put this philosophy into practice by trying to educate his customers and regulators. He started publishing annual financial reports in 1894, fifteen years before that became the standard. In 1897, he began to make public appearances and created a speakers’ bureau. In 1901, he opened an advertising department; shortly thereafter he created a PR department charged with publishing a monthly magazine, Electric City, distributed free all over the city, with articles on how to save on electricity costs. He had the PR department send a regular update to newspaper editors, then solicited their opinions. He cultivated politicians early in their careers, enduring their criticism when politically expedient, never stooping to bribery (that in itself was a big change in Chicago).
During the run-up to the American entry into World War I, Insull volunteered his services as a publicist to his former home country. UK Foreign Secretary Edward Grey was initially resistant. “Mr. Insull, you, as a born Englishman, come here and make the suggestion that His Majesty’s Minister for Foreign Affairs should be interviewed by a newspaper reporter. It seems impossible.” Ultimately Grey was convinced and top American journalists were granted access. Insull also worked with the American Government’s Committee on Public Information. His best idea was the Four Minute Men, speakers who went to movie theaters and amusement parks to deliver four minute speeches (he enlisted 75,000 people to do this).
What I find most compelling is Insull’s appreciation of the inextricable linkage between public relations and the proper conduct of business. As author Forrest McDonald writes, “The most effective device Insull had for winning public favor was rate cuts… dictated by good economics but they also had immense publicity value… and he announced his cuts with an extraordinary sense of timing… only once did his rates get cut by contract ordinance.”
Insull’s approach should be adopted by present leaders of corporations or governments. In a 1919 speech, he said, “I am a great believer in publicity. I believe it is our duty to enlighten our communities on the situation… to present the facts to the employees whose interest is just as vital as that of the managers, to the customers and to the citizens of the State of Illinois.” His approach was endorsed by President Woodrow Wilson in 1916, “The rule of publicity is not doing anything under cover; let the public know what you are doing and judge of it according as it is. There is no use inviting suspicion by secretiveness. If a business is being honorably and successfully done, you ought to be pleased to turn it inside out.”
Happy New Year to all.
Richard Edelman is president and CEO.
Image care of Wikipedia from the Edison National Historic Site.