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July 10, 2006
Get Back Onto the Field
Your faithful blogger took a week off..yes that meant freedom from the blackberry and even from my blog. I can give you one very funny line from a restaurant wall in Monterrey, California, from the golfer Chi Chi Rodriguez, "I never exaggerate, I just remember big."
I also want to tell you how pleased I am by the reaction to my previous post on Sir Martin Sorrell's comments to a UK newspaper group about the internet. I had another opportunity to debate this issue with him on CNBC while at the Fortune Brainstorm 2006 in Aspen. The news hook was a Forrester study by Charlene Li showing that only 8% of Americans trust advertising, down from 12% in 2002. Now onto the subject for today.
I came away from the Fortune event profoundly disappointed by the performance of the business leaders who were on the panels. In one module on Capitalism under Fire, the CEOs of Home Depot (Bob Nardelli) and Sears (Ed Lampert) were completely flummoxed by Andy Stern, leader of the Service Workers Union (SEIU) and unable to respond to pointed questions on executive compensation from Norman Pearlstine, senior advisor at Time Warner. As I look back on my notes from the two days, I have comments from Lester Brown on the environment, from Dr. Seth Berkeley on HIV/AIDS, from Diana Farrell of McKinsey and Gene Sperling, former Clinton domestic policy advisor, on tax policy, but nothing from the CEOs. A panel on cancer research had the founder of the Susan Komen Foundation, the head of the Anderson Cancer Center in Houston and Lance Armstrong, superstar athlete and survivor but not a CEO.
At dinner last night with Dan Gillmor, founder and director of the Center for Citizen Media, we were commiserating about the conference and the poor showing of the private sector. He hypothesized that some of the CEOs on panels were "winging it", not preparing as thoroughly as they should. He referred to superficial comments by Terry Semel, CEO of Yahoo, at the recent D Conference on the strict regulation of the Internet in China as being indicative of this lack of preparation.
I believe the problem is deeper than that. It seems that CEOs are seeing their jobs in a narrower context than in a previous time. The political wars over trade, environment and drug pricing are largely delegated to trade associations in Washington or Brussels. Of course, there is money raised for candidates who are supportive on a given issue and funding is supplied to third party groups such as American Enterprise Institute. But the essential "outside game" of engaging with and persuading key stakeholders of the correctness of a specific policy is set aside. Instead, the skills exhibited during the question period in the House of Commons by Prime Minister Tony Blair are what is necessary, not just the prearranged questions from the White House Press Corps for President Bush.
A skeptical public demands direct contact with those in power so that hard queries can be posed. Business delegates this responsibility at its own peril. That is why the 50-city tour around the US by the top executives of Shell Oil (an Edelman client), who will conduct town halls for regular people as well as opinion leader meetings, makes so much sense. Or why Pfizer's (another client) outreach on healthy aging in Europe is smart because it makes business a player, not simply a bystander lobbying on the side.
So my advice is simple, Get Back Onto the Field. I may sound like an unsympathetic coach of a sports team. That's right, I am. You CEOs, stop worrying about mistakes you might make and take some shots. You only win by playing hard, not by playing safe. A few World Cup teams can tell you that story.
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CEOs, PR, Public Relations
Posted by Edelman at July 10, 2006 9:55 AM
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Comments
Hi Richard. Welcome back! You were missed.
I have had the same experience you shared about going to meetings and walking away very disappointed in CEO panels. I've tended to write it off to a lack of preparation and arrogance in believing they need only show up and that should be good enough.
I thought it was interesting that Bob Nardelli has suddenly chosen to "defend" himself and Home Depot in the media. He complains that the good messages are being overshadowed by negative press. You'd think he'd have made the connection by now that there's a direct link between accessibility and tone of coverage. It'll be interesting to see if other CEOs begin following this tactic of Shell and Pfizer. Stakeholders have become far more demanding of CEOs. It's time they step up to the plate.
Perhaps this opening from Sunday's Atlanta Journal-Constitution will interest you:
'This is a company that believes in transparency'
Home Depot Chairman and Chief Executive Bob Nardelli is one of the highest-profile executives in corporate America, yet he has been known to be among the most tight-lipped with the media and the public.
Even as the company's stock price lagged and critics punished Nardelli for his pay package, the retail chief stayed quiet. The silence was perhaps most notable during Home Depot's shareholders meeting in May, where Nardelli --- the only board member in attendance --- refused to take questions from shareholder activists.
But the man is on a new mission these days, opening himself up to Wall Street analysts, stockholders and media alike.
In an unusual and wide-ranging interview last week, Nardelli talked to The Atlanta Journal-Constitution about the company, the controversy and the business strategy for Home Depot --- a message he says has been overshadowed by recent headlines.
The full Q&A is available at www.ajc.com until it goes into the archives on Sunday, the 16th.
Posted by: Marilynn at July 10, 2006 12:07 PM
Richard:
If (when) the Shell 50-city tour proves to be a huge disaster... will you then consider modifying your sermon? Bottom line: if you don't, the marketplace surely will do it for you.
- Amanda Chapel
Posted by: Amanda Chapel at July 10, 2006 12:30 PM
(1) What is your opinion on Chrysler's Ask Dr. Z campaign? It seems to go along with the "CEOs just want to be loved" trend, and the me2 trend in the spot where he talks with an "actual" customer and answers user questions on askdrz.com in a Yahoo! Answers style way. Can this approach build more trust? The approach is more interactive and personal, but it still seems like softball.
(2) I remember the awe of watching my first parliamentary session on C-SPAN2 with legislators and politicians (Blair included) in a verbal firefight with stats, facts and witty barbs. Although I am careful not to idealize that political discourse, a great deal is lost by moving away from lively, unpredictable, or even extemporaneous discourse. Too often, over-prepared or ad libed discussions add very little to complex issues.
Posted by: Eric Hansen at July 10, 2006 3:23 PM
Here is your problem in a nutshell. You just don't get it.
You want participation from the private sector? Let me connect the dots here. The next time you go to one of these conferences, find out who is blogging in the town you are going to, and invite them.
How hard is that? Steve Rubel can probably crank out a hundred in Aspen with phone numbers and zip codes if you are concerned with taxi fare.
It is MY opinion that your whole industry is dying, despite all of your re-engineering efforts, as I can tear your carefully crafted PR campaign a new one with a single posting. I am not alone here.
Your current efforts at revitalizing PR are laughable as you are trying to convince CEO's to look at the Big picture by dragging every remotely connectable event, that you can make any sort of tenuous relationship, to the client of the day, to continue the "I brought the idea to the table, so now you have to support me", welfare program.
Through the magic of the Internet I will make my case and hoist you by your own petard.
You said above:
"A skeptical public demands direct contact with those in power so that hard queries can be posed. Business delegates this responsibility at its own peril."
This is the part you got right, as there are millions of us "privates" who can reach out and touch you.
Where you pulled the lever and hung yourself is the very next sentence:
"That is why the 50-city tour around the US by the top executives of Shell Oil (an Edelman client), who will conduct town halls for regular people as well as opinion leader meetings, makes so much sense."
You are still 'managing' the message, when you should get the hell out of the way and sit in the back of the room.
One final thought.
If you need to 'manage' these events, are you really sure you want these folks as clients?
Posted by: alan herrell - the head lemur at July 10, 2006 6:08 PM
As Wayne Gretzky said, you miss 100% of the shots you don't take.
I wonder, Richard, if you think that many corporate leaders would be capable of thriving in a wider context. Certainly my experience in Davos suggests that there is a minority of CEOs who are truly engaged with the broader issues.
That's why the John Brownes and Louis Schweitzers of the world are so exceptional in a Davos or Fortune Brainstorm context. Many of their peers aren't particularly interested and certainly have not given key issues much thought.
Posted by: Lance Knobel at July 10, 2006 7:14 PM
Frankly, it doesn't surprise me that CEOs were the most uninspired speakers. They have lost their rock-star staus and are in full defensive mode. With Enron still stinging, the defeat is complete.
Take Home Depot's recent shareholder meeting (I have linked to my post about it in the URL). Bob Nardelli stonewalled investors to try to avoid the compensation issue. It was an ugly scene.
Other CEOs, beyond being out-of-touch, as you suggest, have lost their appetite for taking risks. I wonder if they can lead and foster a new ethical risk-taking culture? It seems a tall order.
Posted by: Kami Huyse at July 11, 2006 11:15 PM
Richard,
Great post that hits close to home. After spending about six years managing communications for one of the world's top CEOs, I joined a prominent PA/PR firm and built an offering focused on helping CEOs and their communications teams better focus on their constituencies. The CEO job today is about connections -- with employees, customers, shareholders, communities, alumni, the media, environmentalists, and the list goes on. CEOs must understand those constituencies and be able to communicate with them effectively. But after nearly a year of marketing our offering, we ultimately had to pull the plug. We had a couple wins, and nearly universal acknowledgement that the offering was compelling, but few customers. The potential clients just didn't feel any sense of urgency about such a proactive, strategic program. Alan Murray has a great piece in the Wall Street Journal today that compares the reputations of Jeff Immelt and Bob Nardelli -- two CEOs whose companies have performed similarly for their shareholders but their different approaches have made Immelt a star and Nardelli a pariah. It's no longer just about operations and finance. In a world where corporations are global and touch nearly every interest and issue, their leaders must be visible, engaged, open and effective. Or pay the price.
Posted by: John McGrath at July 12, 2006 12:49 PM
Lance,
great to hear from you
I believe that the ability to speak effectively in a public forum is developed over time
We are not allowing CEOs to play in the minor leagues before graduating to the majors
They need to play the game externally, to make a few errors without huge consequence, so they are prepared
I do think the capability has been allowed to go fallow
Posted by: Richard Edelman at July 13, 2006 12:31 PM
Alan,
I appreciate your sentiments---disagree but that’s baseball
Let’s be clear—we are not doing this work for Shell, so I am not being self serving.
As for us getting out of the way, that is the point initially made by David Weinberger
Just let us speak to the corporations
It won’t work
There needs to be somebody suggesting opportunities and themes and cooperation with NGOs
I am not saying PR firms should do message triangles and speaking points
We should get our clients to be more forthcoming and direct for sure
Nor do I want Pr firms to be telling half truths and spinning
So let’s agree to disagree respectfully
Posted by: Richard Edelman at July 13, 2006 12:33 PM
JM,
You are absolutely right on the Murray piece. We are lucky enough to work with GE on Eco-Imagination
Posted by: Richard Edelman at July 13, 2006 5:02 PM
Richard,
A credit to you and yours. GE has had great success in the green space over the past couple years. Gary Sheffer and his team are a pleasure to work with.
John
Posted by: John McGrath at July 13, 2006 5:04 PM
