HONESTY? HONESTLY!

“Integrity is telling myself the truth. And honesty is telling the truth to other people.”Spencer Johnson

When Carol Bartz was relieved of the big swivel chair in the Yahoo boardroom recently, many commentators applauded the refreshing frankness of her short goodbye email to staff. It included an admission that she had been sacked, by phone, by her chairman.

She could have said she was stepping down to pursue other interests, to spend more time with her knitting or claimed divergent views over strategic direction. But no, not Carol, who openly confessed to having been ‘fired’, emboldened perhaps by the prospect of a $14 million severance package.

But then, honesty quickly gave way to emotion and Ms Bartz gave an ill-advised interview to Fortune Magazine when she claimed that ‘… those people f**ked me over.’ ‘Those people’, one can only assume, are the same erstwhile Board colleagues she went on to describe to the reporter as ‘doofuses’.

Mixing press interviews and raw emotion, particularly for executives like Carol who are on first name terms with the type of language practiced by well-refreshed sailors, seldom end happily.
With her handsome severance package subject to a non-disparaging clause, she might now be regretting her foul-mouthed candour. But the story got me thinking – does honesty, even subjective honesty, ever make a comfortable bedfellow in the corporate world?

I’ve never met a company that sets out to be dishonest in its communications. I’m not talking here about Sherriff Sarbanes and Inspector Oxley’s work in cleaning up corporate reporting and disclosure among US-listed corporations, but the challenge of honesty and transparency in everyday corporate communications.

When it comes down to it, most companies sugar coat with the worst types of political correctness. They ‘right size’ instead of cutting jobs, they express ‘regret’ instead of saying they’re sorry when they get it wrong and they set about ‘restructuring’ or ‘transforming’ when the business simply isn’t delivering good results. Nor can they bring themselves to admit to weakness. When they miss the market, forcing them to link up with a competitor to fill a void in their offering, they express near religious levels of delight with their new ‘strategic partnership’, and typically never mention it again.

This is partly the work of lawyers who think they’re reducing or eliminating corporate risk, or marketeers and senior executives who have an acute allergy to criticism from the hacks and analysts paid to express an objective opinion on the business. The problem also stems from trying to satisfy the often conflicting demands of multiple, self-interested parties. Investors usually welcome job cuts or cost reductions in the hope of inflated returns or dividends, while employees with mortgages and their trades union representatives typically disagree. The flaccid nature of internal announcements can also be driven by fear of leaks to the outside world.

Corporations, both privately and publicly held, can choose how honest they want to be in their internal and external communications. But unless they’re prepared to meet the cost of that transparency when they don’t like the reaction, CEOs would be better served not standing on platforms promising such values.

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Most days for the in-house communications team should be reasonably relaxed, with a manageable workload and various comfortable deadlines in the forward diary. If this isn’t the case, the team is either under-skilled, under-staffed or trying to do too many things.  But every now and again the crazy fairy arrives, usually invited in by poor planning, rotten luck, bad decision-making or a stupid comment.

Whatever the cause, the result is usually the same – your personal life, or even worse, the company’s reputation – edges perilously close to shredding in the fan’s rotors.  With Indians circling the wagons, you call your PR agency.  The consultants mobilise and arrive with contact books, tools, experience and administrative support underneath their well-exercised helmets and shields.

There are three typical scenarios when the in-house comms department needs a PR agency.

The first is as a flexible labour resource that can be turned up or down through the spikes and troughs in workload.  The agency can also be an ideal solution when Melanie’s maternity leave or Jeff’s unexpected promotion and pay rise elsewhere means you’ve come up short.

The second is the supply of brains that are bigger, more creative or more objective than those already available to you in-house.  The agency’s big guns are clever and not as immersed in the daily muck and bullets of your business. That detachment can be valuable.

Finally, the agency can be the reinforcements when there’s a war on and you have to defend, for example, the unwelcome advances of an acquisitive, cash rich competitor or a private equity outfit that doesn’t recognise or add up the value of the business using the same models your Board does.  Also things may need to be said or reported without any trace of your fingerprints in the heat of battle and distance is a good thing. Or maybe you need a financial PR whizz with a direct line to the various city editors.  This is ideal work for agency principals, or ‘people close to the company’ in journalese.

The flexibility afforded by an agency is great, but there’s a problem.  The on-demand resource you need as a client creates an unpredictable fee income stream for the agency. That in turn makes for an unhappy relationship between the agency and its bank manager and tension for agency staff with a desire for regular pay cheques.  That’s the problem – the PR agency business model is not always well suited to the rule of the in-house team’s need.

To massage their problem away, most PR agencies set themselves up to mirror the in-house capability. They get busy collating forward features lists, drafting press releases on the latest new product or business win, building distribution lists and practicing ‘selling-in’ stories to the media.

Don’t get me wrong – some agencies are very good but too often, the only thing that really differentiates them from one another is size.  The inherent flexibility and value that an agency should be best placed to provide becomes a mainstream media relations capability wrapped in a confident air and a monthly retainer, plus expenses.

All that remains for the agency’s model to improve is to agree a scope of work, divide the annual cost by 12 and a smile breaks out on the bank manager’s face.

Some agency folk will argue passionately with this. They’ll talk about providing strategic direction.  They’ll produce credentials in social media campaigning and digital marketing.  But claims are easily made.  They’ll also mention their exceptional relationships with the press. Here’s the rub:  you need those same relationships and outsourcing the job of building them doesn’t bring them closer.  Here’s another thing – the press actually prefer to speak to in-house folk.

Having an agency to duplicate your in-house team can seem alluring, except perhaps to the PR manager you hired because he or she was a great practitioner. Now, they’ve had to retrain as an overpaid agency and procurement manager.

And this is, in part, is why the relationship between the in-house team and the agency comes under strain.  Agencies operating as your daily press office are driven to generate column inches. They have to.

In the majority of cases, that’s what they’re effectively paid against and that’s why the monthly cuttings book usually arrives in the same envelope as their invoice.

Too often, it doesn’t take long for whatever was agreed as the programme’s main strategic objectives when the contract was signed to get misplaced.  That’s why we read so many market research stories in the press.  Every agency I’ve used, when obvious activity is light and the cuttings thin, pulls the survey or ‘creative initiative’ out of the bag.  I’m not knocking surveys, or PR stunts; they usually work as long as the approach has at least a nodding acquaintance with your actual communications priorities. Often, alas, they don’t.

The conundrum doesn’t make for the most exciting life for the agency consultant either.  If they’d wanted to work in-house doing media relations every day, they’d have gone in-house.

Time invested working in an agency can provide great training for someone that wants to make the eventual move in-house. But for many, the work becomes dull after a while. Yes, they’ll be able to manage the administration for a press conference or facility visit. They might even get to sit in a press interview with the CEO taking notes.  But when the journalist wants to discuss a story in depth, or go off-piste, the consultant invariably has to hand over. They’re not a spokesperson.

There are a number of small agencies staffed with senior executives who are making a living, not trying to grow a business.  But they often struggle to get taken seriously by the blue chips. This is a good thing. If they had one or two blue chips on their client roster, they’d feel compelled to grow and that would be the start of a difficult discussion with the bank manager.

Using agencies appropriately can be a rewarding experience for both parties.  But it’s the exception, rather than the rule.

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