As protesters in Seattle faced riot police last week in their effort to sway World Trade Organization negotiations, executives in the PR world continued to wage a subtler resistance against would-be infringers on their business turf. The unwelcome competition in this case: management consultants.
Whether the threat is real or imagined, the issue is consuming PR agency chiefs as they set long-term growth plans for their organizations.
At the ICO summit held in September in Switzerland, Ketchum CEO David Drobis warned a captive audience that, "Other professional services also recognize the value of communications and relationships in an information economy, and are challenging us like never before. Management consultants, accountants, lawyers and even executive recruiters will seek to diminish our role with clients.relegating public relations professionals to implementers of some far-removed strategy developed by other business counselors."
The fear isn't that MBA-packing consultants will put PR firms out of business. Rather, the power struggle is over the perception of strategic prowess. Representatives from Towers Perrin and Arthur D. Little raised blood pressures at a Counselor's Academy meeting earlier this year when they suggested that consulting firms knew strategy best, while PR firms were better equipped to juggle tactical assignments.
Meanwhile, consultants also have drawn disciplinary battle lines (albeit inadvertently) by suggesting that the PR industry's most recent forays into specialties like employee communications and change management may be impractical. "PR agencies are very strong and work external communications every day. But communication internally is not just a newsletter, video and [intranet]," says Jim Shaffer, a partner with Towers Perrin in Rosslyn, Va. "It involves pay systems, work processes, internal leadership. PR firms admittedly don't have expertise in systems administration. We, on the other hand, are weak on external. My belief is that we each have complementary strengths and weaknesses the other can fill."
Shaffer adds that while a handful of pioneering PR counselors like Bob Dilenschneider have successfully positioned themselves as experts on organizational structure and business strategy, they are exceptions to the rule.
Wolves In PR Clothing?
For the most part, the big consulting firms deny they're going head to head with PR (although one unnamed source at Deloitte & Touche hinted that the firm's senior partners would be sniffing for new business opportunities once the Y2K cash cow is out of milk).
Even PriceWaterhouseCoopers (PWC) - whose three-year-old Reputation Assurance practice now offers strategic advice on matters such as "building stakeholder relationships" and "measuring the financial impact of corporate responsibility" - defines itself in a different genus from PR.
"We don't consider ourselves to be in direct competition with PR firms," says Harold Kahn, a partner with PWC in New York. "If anything, I'd say we are more analogous to investor relations." Aha! So PR doesn't encompass I/R either.
"My sense is that we [at PWC] are not communications specialists, per se," Kahn adds. "That's what a PR firm would look to as a core competency. Our focus is on systems and processes, whereas they [PR firms] are focused on being the external mouthpiece and positioning a company in the marketplace. I actually see a natural compatibility, and a complementary scope of practice between PR firms and management consultants."
Notice a trend here? This is the kind of head-patting that makes some PR executives seethe. The reason management consultants don't consider themselves rivals to PR is because they don't define PR the same way as the industry defines itself. PR may as well be a synonym for media relations or event management.
On The Front Lines
Maybe the whole dialogue boils down to a battle of semantics. (This writer is admittedly fuzz-brained after wading through her jargon-riddled notes from both camps.)
But the real war isn't so much about how each business defines itself as whether or not clients believe that the counselors in question can deliver the goods. And in this regard, management consultants have a distinct leg up.
"They are already dealing with the CEO or CFO, whereas PR firms are dealing with the top PR or public affairs officer in the company," notes Jim Wills, a former Booz Allen staffer and now principal of Wills Consulting, an executive recruiting firm in Greenwich, Conn. "So [management consultants have] a higher level of entry."
Even PR supporters (of which Wills is one) won't deny that one. Consider the drama that's now unfolding in the field of change management - fueled by the bull market's seemingly endless orgy of mergers and acquisitions.
"The management consulting firm gets the change management assignment because they've had the account from the beginning," says Jack Bergen, president and founder of the Council of PR Firms. "Toward the middle of the assignment, a lot of communication responsibilities start happening. [That's when] the plan gets turned over to a PR firm for execution [after the strategy's been mapped out]. This is where PR firms are finding it unacceptable."
Ever the diplomat, Bergen declines to deploy the proverbial "hatchetmen" stereotype in discussing management consultants' roles in organizational change. Instead, he offers one reason why PR firms are better armed to handle merger strategy, from soup to nuts. "Once you get into affecting major change in an organization, you're dealing with a right-brained situation.emotion as well as intellect," he says.
The question is whether CEOs will see things this way. Is there any way to measure emotional stability against ROI?
(Drobis, 212/878-4600; Shaffer, 703/351-4750; Kahn, 212/596-8170; Wills, 203/622-4930; Bergen, 877/PRFIRMS)
Stay tuned for part two next week, when PR NEWS will report on successful partnerships between PR agencies and management consulting firms.