In November 2003 quasi-governmental mortgage lender Freddie Mac announced a $5 billion accounting restatement. That's more than an oops. It cost the organization three CEOs in
less than 12 months, as one executive after another tried to cauterize the damage.
This left Michael W. Robinson with two big jobs on his hands. As director of financial communications he needed to handle the substance of the scandal itself. At the same time,
he had a PR role to play, helping each successive CEO to establish a successful footing on very shaky terrain. (The present CEO, Richard Syron, came on board in December '04 and
continues to hold the position.)
"Because PR is talking to the media every day, it knows where the pain points are" in terms of public perception, he says. As such, "PR can help to identify the ways in which
the company can move forward, and help the CEO translate those into policies and actions."
After a CEO has gone down in flames, the new top dog needs advice not just on image but strategy, direction and implementation; observers say the savvy PR executive stands in
a unique position to offer all these forms of guidance.
Face time
Job One for PR execs in this situation is to push the newcomer out into the public eye. This is counterintuitive and the CEO may resist, thinking it better to lie low until the
storm blows over. But experience shows otherwise.
Take, for instance, the State of Connecticut, where Gov. John G. Rowland stepped down recently amid corruption investigations and threats of impeachment. Rather than hide
behind a desk, new Connecticut Governor M. Jodi Rell gave face time as soon as she took office. She hosted 950 citizens at an open house, held meet-and-greet events throughout the
state and fielded phone calls in on a radio call-in show.
"People like the common touch, they like leaders who don't think they live on Mt. Olympus," says political consultant Roy Occhiogrosso, a principal with Global Strategy Group.
That means you make yourself visible both externally and internally. "It means you go down to the cafeteria and say hello to the people who work with you, rather than arriving in
a limousine."
These initial gatherings are a vital piece of communications in the early days of a CEO's tenure. "For someone who was not well known, PR has been incredibly important to play
here, because how you get introduced to the public has a lot to do with how they perceive you initially and also down the road," Occhiogrosso says. (The governor's office did not
return our telephone calls.)
The big picture
At this point, the ambitious PR executive will move beyond the CEO's public face to take an active role in setting the agenda for the organization. In certain respects, this is
a unique moment, for it offers PR pros an opportunity to use their unique communications skills to articulate an organization's promise and potential.
With the CEO still in a (brief) honeymoon period, "it's a good time to announce bold visions and new directions," says Lynn Parker, a principal at integrated branding and
communications firm Parker LePla. PR can drive the new leader in that direction with careful counsel of what the perception is among stakeholders and what steps are needed, if
any, to alter that perception.
"This is the upshot of the scandal, this is effect on our shareholders, this is what we believe our customers are thinking," Parker says. "You lay out that reality and then
lay out a plan for instituting new messaging around each of these issues. You lay out the milestones and lay out the actions that you need to put in place today. All of a sudden
they see a path to the beautiful tomorrow."
The best way to do this is to start early. As a crisis builds -- and it becomes apparent that the CEO will have to go -- PR needs to talk with stakeholders and gather the hard
data that will help guide the new chief executive. "What are we really dealing with here? Can we begin to quantify those issues?" asks Patrick Mangus, senior VP and director of PR
at marketing communications agency Blattner Brunner. Doing the hard research "allows you to home in on the true issues: What are those things that can be changed? And then you can
start to formulate a communications strategy for addressing those issues."
Back to business
Once a new direction has been established, it's time to get down to brass tacks. The best communications strategies will come from legitimate business successes.
In trying to re-position the new CEO, "you have to have proof points," says Harlan Loeb, director of litigation services for Hill & Knowlton. "Worry less about Wall Street,
and more about shoring up the audience group that really brought you to the dance, which is your consumers, your customers." In that sense, positioning your CEO means pushing that
executive out of the limelight. After the initial introductions, the job of PR is to start reminding people that the "story" is about the company -- not individuals.
"If people ask, you should be prepared to talk about the credentials of the new leadership, but you don't want to hype too much," Loeb says. "Do not put the new CEO on a
pedestal. Let third parties confer that honor on the CEO. It is the customers and Wall Street who will be the ones to essentially anoint you."
A little bit further down the road, it is possible to bring out the CEO again in quite another role. Suppose the original crisis involved malfeasance on Wall Street. PR can
groom the new leader as an expert, say, on Sarbanes-Oxley, lining up speaking engagements where the CEO can address the still-unfolding subject. It's a scary proposition, but it's
also a way of showing the world that the new regime really is setting itself apart from the old. "There is nothing that says that louder than being a thought leader on exactly the
subject that has caused you such turbulence," Loeb says.
Contacts: Harlan Loeb, 312.255.3072, [email protected]; Patrick Mangus, 412.995.9524, [email protected]; Roy Occhiogrosso, 860.348.0585, [email protected]; Lynn Parker, 206.285.5280, [email protected]; Michael W.
Robinson, 202.973.1340, [email protected]; Alex Stanton, 212.780.1900, [email protected]