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October 30, 2008
Public Engagement
I delivered the Grunig Lecture at the University of Maryland today to a group of students and their professors. My topic was the evolution of public relations into public engagement. I asserted that PR can become the discipline that melds strategy and communications, constituting an essential bridge between corporations and their stakeholders. I contended that PR must also be part of business strategy and policy formulation, in addition to being responsible for communicating the decisions.
There is the confluence of several trends in the marketplace that make this transition possible and advisable. The recent government emergency intervention in global financial institutions has ended the free market era of Reagan and Thatcher. The dispersion of authority continues with CEOs under fire (akin to the period 2001-02 after Enron, Parmalat) and government officials seen as ineffective regulators. The transformation of media is accelerating, with mainstream media downsizing (layoffs at Time Inc. yesterday morning), greater reliance on digital platforms and merging of news with entertainment (“newstainment”CNN’s new comedic news show). Expectations on companies are rising with stakeholders looking for Mutual Social Responsibility-- merging cause related marketing with corporate social responsibility.
I suggested that Public Engagement has four important attributes:
First, it is democratic and decentralized. A good example of this is the Obama campaign’s mobilization of five million volunteers, who are able to make decisions on how best to contact voters, attract funds and communicate on social media. Another is the MyStarbucksIdea.Force.com site that solicits new product ideas from the crowd, reinforcing the company’s relationship with its customers while the company listens and learns (disclosure: Starbucks is a client, but we are not involved directly in this program).
Second, it aims to inform the conversation. This is a major change for PR, which has relied on research-tested messages delivered one-way to media, which then writes the stories. If Andrew Heyward, former president of CBS News, is correct in positing that “Every company today is a media company,” then smart businesses will take the opportunity to become public resources on areas of expertise, by providing credible well-researched data on its own web site, and correct on-going discussions, whether on discussion forums or in the press, if there are factual errors. An example of this is our work for Masdar, the first carbon-neutral city in the world that has become an important focus for data on new forms of energy.
Third, it calls for engagement with influencers of all stripes. To be influential today does not require academic or professional credentials alone. It means that the person has personal experience with the product, passion for the category, and a desire to contribute to general knowledge. It is our task in PR to build trusted relationships with the broad set of influencers. A great example is the Johnson & Johnson (a client) Family Health Institute in China, which helps educates mothers about family health, and funding schooling for nurses.
Fourth, it suggests that reputation is built on policy and communication. Our client Wal-Mart’s strong commitment last week to the highest standards on environment and workplace safety in China is indicative of this trend. It is often useful to partner corporations with the NGO community for input in the decision making process and help garner support in the broader community.
The rationale for public engagement is best captured by Thomas Friedman, who wrote a week ago in the New York Times, “In a connected world, countries, governments and companies have character…how they do what they do, how they keep promises, how they make decisions, how they engender trust…” The PR business must rise to the challenge, by creating a new form of expression that will work in today’s cynical and uncertain environment.
Here is a copy of my presentation. Click here to watch my speech. Click here for advice from Matt Harrington, Edelman's US President and CEO, on Communicating Forward.
I would appreciate your views as always.
Posted by Edelman at 6:25 PM
Comments
Richard,
It was a pleasure meeting you at the Grunig Lecture and hearing you speak. As a former Grunig grad student, I was thrilled to see many of the Grunig's long-developed theories and models addressed in your presentation. In the 1990s it might have been said that the idea of two-way, symmetrical communication and honest, open communication with publics was just pie-in-the-sky thinking. However, you've shown it's now a reality. And, through your own work, you are showing it is a NECESSITY today. Thank you!
Posted by: Michelle Brosco Christian at October 31, 2008 9:41 AM
This looks a very interesting analysis: thanks for sharing. I also enjoyed Crowd Surfing and thought its insights into the type of managers likely to succeed in a chaotic and fast-changing environment particularly important.
Posted by: Richard Bailey at October 31, 2008 3:26 PM
Hi Richard....well articulated.
I am also looking at this as going from Public Relations to Public(s) to Relations and Engagement.
Posted by: Alan Weinkrantz at November 1, 2008 3:48 PM
Richard, you hit the nail on the head with your 'cause marketing' observation.
While many marketing professionals are finally starting to understand that their future success hinges on their ability to learn how to intelligently mix traditional and social media channels for their clients, the latter haven't yet caught on to the opportunities to drive meaningful engagement via cause marketing. They'll figure it out eventually.
Great post!
Posted by: Olivier Blanchard at November 3, 2008 10:31 PM
As a former Edelman employee, I'm not surprised by the thought leadership you showcased. The way you explain the trend in PR is very intellectual and probably too ahead of its time for many! I will share this with my network.
THANKS!
PS - Can I have my job back ;-)
Posted by: Carmen Harris at November 4, 2008 5:15 PM
Richard,
They are greatly insightful slides to explain the concept 'Public Engagement' which is new for me. Thanks always for your vision and insights.
- former PR manager, InBev Korea
Posted by: James Chung at November 4, 2008 7:51 PM
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| TrackBackOctober 24, 2008
Fox Interview
Please check out my interview earlier today by Fox Business News, called "Edelman on the Bailout Plan," where I discuss how financial corporations and government can effectively communicate in today’s economic conditions.
Richard
Posted by Edelman at 4:21 PM
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| TrackBackOctober 23, 2008
WSJ On the Move
Edelman hosted Wall Street Journal editor Robert Thomson for breakfast this morning in New York City. Here are a few of his most important observations:
1) The Big Brand—Digital must work together with print and wire service to maximize the WSJ brand. In the new office of the WSJ in Midtown Manhattan, the editors of the print paper, WSJ.com, MarketWatch and news services will all sit together. “Every journalist must aim to be a Renaissance reporter, in web, audio, video and print. The paper must be connected to what is on the web site. Every journalist is part of this extraordinary experiment.”
2) Competitive Set—The WSJ has stepped up its global coverage in the US edition, “to put the world into perspective,” and to compete with the Financial Times. The increased focus on government and Washington DC is intended to “reach the non-business folks who read the NY Times.” There is also an opportunity to have the WSJ become the primary place for business news in local markets where the traditional newspapers have culled their financial reporters in recent cutbacks.
3) Hierarchy of Content—The WSJ will continue to have a mixed regime of free and paid content on the web. The theory is the “more specialized the data, the more we can charge. So if there is a customized search function tied to micro payment software, we can monetize the content.”
4) Digital is Global—The total global on-line audience for the WSJ.com in the past month was 24.5 million unique visitors, over half from outside the USA. The Chinese CWSJ.com site had a six fold increase in its number of unique visitors in the past year from 400,000 to 2.4 million. There are now Indian and Japanese WSJ home pages with distinct content.
5) The Editorial Page—The paper has maintained the “church and state” separation of editorial and commentary. Thomson is particularly proud of the unique WSJ technique of reporting as well as advocating within its expanded three pages of commentary.
6) News Production—“We are trying to speed up the metabolism, to create within the journalistic community a real sense of competition. We need to be ahead of the other media all of the time.” Thomson also noted that journalists are being given a new goal, “relevance to readers.” He is concerned that serious companies are not getting enough coverage; that there may be too much emphasis on personal finance. He is keen to get more stories from the regional bureaus, because the articles lend personality to the paper while offering national insight.
7) Future of Newspapers—He is very confident about the WSJ’s future, noting that advertising was above plan for September. “We need to find new sources of revenue, such as a foreign exchange news service in Japan that is now very popular with individual Japanese investors. We must offer mobile delivery of content because the speed of delivery changes the nature of the content itself.” He suggested that content will increasingly be repurposed for the small mobile screen. He added that newspapers generally will have to be better about qualitatively analyzing audiences, to fight the perception of commoditization of readers (“our readers are smart and affluent”).
8) On Government’s Role in Business—Thomson believes that more regulation is inevitable, particularly in financial markets. What is less clear is the process by which regulation is enacted. “Will there be an active, healthy debate or will it just roll through the Congress?” He questioned the utility of “sudden measures” such as the temporary ban on shorting of financial stocks.
The advent of the Murdoch team has brought real dynamism and imagination to the paper. The investment in globalization, the determination to operate across platform and the commitment to editorial excellence are exciting strategic pillars. Those of us in the PR community will need to recognize the need for speed, the desire to be simultaneously global/local and the utility of visual support materials that facilitate story-telling.
Posted by Edelman at 9:41 AM
Comments
Richard, thanks for sharing these blog posts with all of us. You really put a lot of thought into the media world. This is a great summary of the big changes that are happening at WSJ and the rest of the publications. I'm a partner in a Silicon Valley PR firm and I've been following changes to print publications intently.
One of the topics we discuss in our office is the decline of the reporting style in newspapers and magazines. We hire reporters and my business partner is the former assistant dean for the UC Berkeley graduate journalism school. We really respect journalists.
However, the reality I'm seeing is that journalism and publications like WSJ are in inevitable decline.
I spent some time analyzing how Google interacts with the media, including online media. It appears that they are using bloggers as a primary media target, not print publications. Sixty days after the launch of the Google Chrome browser, there are 450,000 independent blog posts about it. Google released the information about the browser to bloggers before their press conference. I've written up more analysis here: http://is.gd/6mJk
Posted by: Craig Oda at November 5, 2008 11:09 AM
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| TrackBackOctober 17, 2008
HBS at 100
Given the economic events of the last several weeks, Harvard Business School certainly picked an opportune moment to celebrate its 100th anniversary. Here are some highlights from the past two days:
Business in Society: Bill Gates was interviewed by Professor Jim Cash about the Gates Foundation. This was the most inspirational part of the two day summit. Gates talked about intervention in situations of market failure. He cited the Foundation’s work in Zambia as evidence of a successful model; deaths from malaria have dropped by 63% in three years because all possible interventions (spraying, vector elimination, bed nets) are being used. He noted that vaccines have caused a 90% drop in measles in Africa, but then pointed out the challenge in Northern India and Northern Nigeria where only 35% of the population is vaccinated. He cited statistics indicating that the Rich Poor divide in health care is now not so stark; that many developing countries such as China are making huge strides in public health. He aims to break the cycle of high population growth, poor governance, weak economy, terrible educational system and bad health. He believes the world population can peak at 8 billion if you improve health and economic performance.
Future of Capitalism: Larry Summers, former US Treasury Secretary and former President of Harvard, noted that we have five cycles now impacting markets, including: Deleveraging; Credit Accelerator where weak economy leads to less lending; Keynesian recession where consumers with lower incomes spend less; Liquidation of financial assets; and Panic, with depositors withdrawing funds. He also believes that the growing inequality of income in the US is not sustainable. He said that in the past 30 years, the income of the top 1% of earners has risen by $600 billion while income of bottom 80% has declined by the same amount (top 1% person got $500,000 more per year, bottom 80% person lost $8,000 per year in income). Even the health outcomes of the rich and the poor are significantly diverging.”
His successor, Drew Faust, president of Harvard, referred the dean Wallace Donlin address to alumni, at the 25th anniversary of the school with the country mired in the Great Depression, about the “failure of business leadership to reach beyond narrow self interest to contribute to social structures and the public good.” She went on to relate the parable of the stone cutters, often cited by Peter Drucker. “The first stone cutter says that he is happy to do his work and go home every day with his money. The second stone cutter says that he wants to be the best in the entire county. The third stone cutter says that he is building a cathedral.” “We need to create stone cutters of the third sort, who embrace the broader vision, who recognize that leadership is a means, not an end.”
Leadership: There were two CEO panels that discussed leadership. The first had Jeff Immelt of GE (disclosure – Edelman client), Meg Whitman formerly of eBay, John Doerr of Kleiner Perkins, James Wolfensohn formerly of the World Bank and Anand Mahindra of Mahindra and Mahindra. Immelt said that today’s CEO must be decisive (even if he/she lacked perfect information), transparent (have to show intent behind decisions), self-aware (be willing to accept criticism and to renew yourself). Wolfensohn said that business leaders will have to spend more time with politicians to influence government policy—the two spheres are now even more inextricably linked. Whitman suggested that as a company gets to global scale, it becomes even more important for the CEO to communicate regularly, to “create a culture of willingness to make mistakes, to acknowledge them and fix them quickly.”
One the second panel Jamie Dimon of JP Morgan Chase urged CEOs to operate a truly open environment where criticism of the boss is encouraged. He added that CEOs were often rewarded with excessive compensation for jobs done in a mediocre manner. Jamie Ayala of Ayala suggested that business has an implicit contract with society as a whole. “The trust in companies is inverse of size—the bigger you grow, the harder it is to achieve trust.”
I came away excited by the vision of business working toward a broader social purpose. But I was not convinced of the real commitment of the HBS graduates to work in this new, more complex environment. The notion of free markets operating in the public interest has been challenged, if not overthrown, by events of the past days. If we take money from government, then we must expect consequences, including more regulation, limits on incentive compensation and other constraints. Today, for instance, The New York Times reported AIG has agreed to suspend a $10 million severance package to its COO and save $8 million by canceling conferences. The PR business has a fundamental role to play as a bridge in the next period.
Sorry for the length of this note, but there was a lot to cover. I appreciate your thoughts as always.
Posted by Edelman at 8:57 AM
Comments
Mr. Edelman,
Thanks for taking the time to share this review. It is interesting that you noted that you felt that you were "not convinced of the commitment of the newest crop of HBS graduates to work in this "new, more complex environment." Perhaps as part of their courses they should spend a semester in Detroit working with small businesses struggling to stay afloat, instead of wondering how they can shoehorn themselves into a nice CEO role somewhere.
What you 'weren't witnessing' wasn't a lack of commitment - it was their deer in the headlights reaction to the current state of economic affairs and the realization that their expensive educations have ultimately left them ill prepared to venture into it.
Welcome to the real world, kids.
As an aside: as a longtime GE shareholder my recommendation to Jeff Immelt is that he stay home, demonstrate some leadership and get his own house in order before touting it on some panel of his peers.
Cheers!
Posted by: Franklin James at October 17, 2008 12:31 PM
Richard:
I was delighted to read your comments about the HBS 100th anniversary celebration. What struck me like a wonderful thunderbolt was Dean Light's comment in his introductory remarks in which he outlined four core principles in leadership and his number one was - "judgment, that leads to sound decision-making." Considering that we have used the tag line "it's all about judgment" for the last 23 years, I was gratified that it resonates more than ever today.
Posted by: Noemi Pollack at October 20, 2008 6:37 PM
Dear Mr. Edelman,
As the Taipan of Rothwell-Gornt, Hong Kong's oldest and most distinguished trading house – and a fellow CEO blogger – I should like to congratulate you on this fine weblog.
I was rather interested to read your comments about Jamie Dimon, CEO of JP Morgan Chase. But allow me to point out that his support for “criticism of the boss” would not be easily tolerated in parts of the Far East.
Indeed the Taipan – Cantonese for “supreme leader” – must be revered as a figure of absolute authority especially during turbulent times. There must be no nonsense where matters of business are concerned!
As the Taipan of Edelman, I’m sure you also appreciate this cut-throat(but quite necessary) approach to business.
I remain a keen admirer of your weblog and your business.
Wishing you the best of joss,
Posted by: Quillan Gornt at October 21, 2008 12:01 AM
To amplify on Mr. Dimon's recommendation to CEO's to accept criticism, add questioning and listening to that. Too often leadership is defined as having the answers. It should start with the questions addressed to those engaged with the issues. And those responding shouldn't feel the leadership is listening with a 'red pencil" metaphorically clutched in their fingers.
A very interesting read, thanks!
Barry
Posted by: Barry Collodi at October 22, 2008 1:32 PM
Richard,
Your HBS at 100, speak-up, and the Oct. 22nd Opinion piece, "America's other deficit: leadership" prompted me to write the following letter to the editor, published in the October 29, 2008 edition of the Christian Science Monitor:
LEADERSHIP BUILDS PUBLIC'S TRUST
In regard to the Oct. 22 Opinion piece, "America's other deficit: leadership": The events of the last year demonstrate that no crisis is more contagious than a crisis of distrust. The leadership deficit will shrink and public confidence will be restored only after trust is earned back. Trust is repaired by behaviors, not words. Initiatives are not balanced and policy failures pile up when ideology trumps the pursuit of the common good. The six world-class leaders from among our founders mentioned by the authors – Washington, Jefferson, Hamilton, Madison, Adams, and Franklin – engaged in common sense governing, as opposed to running a perpetual campaign.
Posted by: Hugh Campbell at October 28, 2008 4:48 PM
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| TrackBackOctober 10, 2008
Networks Fight Back
I had lunch on Wednesday with Jessica Guff, executive producer of ABC News Now and a veteran of ABC News. She made several important observations about the broadcast news business:
1) ABCNewsNow.com, one of the digital platforms for the news division, reaches 48 million homes today, 30 million of which are broadband. “This is the network for thinking women; all others tend to be male oriented,” Guff said. It can be reached directly or via ABCNews.com.
2) PR people must pitch stories differently. Specifically, she said we need to offer fully formed four minute segments, with visuals, spokespeople and news hook all conceived. “Don’t just send me a pitch letter or a book which requires me to put together the piece. Economic pressures mean we are short staffed so we will respond better to something that is fully formed."
3) Networks still offer large number of viewers, about eight million for the ABC Evening News and four million for the Good Morning America show. The morning show audience ebbs in the second hour to about two million. ABC News Now does offer exclusively a third hour of Good Morning America. Content from the major shows, such as Nightline and Evening News, is repurposed onto ABC News Now.
4) Among the shows on ABC News Now are the Money Show, Popcorn (reviews movies), Homework (alternative work styles), Politics Live (with Sam Donaldson, long-time political pundit), Parenting (with Anne Pleshette Murphy of former editor of Parents Magazine), and What’s the Buzz (celebrity news at noon, which gives particular ratings spike as those at work tune in during lunch break—in fact ratings are highest at noon, peak broadband viewing time). The shows tend to be 15-30 minutes long, may not have notable anchors but do feature celebrities and newsmakers.
5) ABC is trying to reach beyond the PC into cell phones and PDAs. “We are now accessible to 10 million users via Verizon VCAST and Sprint,” Guff noted. “This explains our focus on the shorter form content.”
6) ABC News Now does get audience spikes when there is a live event (Obama or McCain rally). “We do breaking news all of the time now.”
The challenge for the networks is to remain relevant as news-hungry consumers go first either to cable or to the digital offerings of newspapers (NYTimes.com as example). What Guff has achieved is a differentiated offer, a digital TV version of woman’s magazine, with necessary information for a better life. As PR people, we will have to be more agile in story creation and to be satisfied with smaller audiences around niche topics. Jessica's comment reinforces the requirement for all PR people to become content creators. We, in essence, must grasp opportunities to create broadcast packages, complete with video and robust storytelling. Use your HD cameras and your writing skills, and make it easy for these news professionals to say "yes." To achieve the same audience reach as a decade ago will require many more placements and more specificity of topics; this is the age of “narrow-casting.” I would appreciate your views as always.
Posted by Edelman at 12:48 PM