Onward & Upward: PR Business Poised for Growth and Profits


Tired of hearing the word "recession" yet? If so, don't worry--it won't be mentioned again (not in this article, anyway), because all signs indicate that the public relations profession is moving onward and upward at warp speed, in spite of the current economic woes. Fortune magazine even touted PR as one of the 10 fastest-growing professions, based on U.S. Bureau of Labor Statistics data. What's more, the behemoths of the corporate world--clients that agency execs salivate over--recognize PR as growing asset to their business strategies. "PR is more valuable to a brand than advertising is," says Bruce Himelstein, senior vice president of sales and marketing, The Ritz-Carlton Hotel Co. "Whether it is business press, lifestyle or crisis management, we probably have a much more integrated look at how we put Ritz into our marketplace than even our advertising approach." It's music to communicators' ears but, especially with regard to boutique agencies (which are becoming more competitive for big-time clients) and smaller internal communications departments, it means pushing even harder to sustain this momentum in today's challenging business environment. So, with that in mind, how can you manage external growth? The short answer: Reflect inward. "You have to identify the strategic intent of your firm," says Rick French, president and CEO of French/West/Vaughan. "Strategic intent--it's the idea of seeing what you want and working backward toward that goal." George Rosenberg, principal of The Rosenberg Group, drills down into this theory of managing growth from the inside out by emphasizing the need for a vision statement--not a mission statement--which will shape and guide your business plan from day one. He identifies the following benefits of a compelling vision statement: Creates meaning for the staff; Acts as a filter for all aspects of the business; and, Helps drive and shape internal culture. Once you've got a vision statement, it's a matter of managing to profit (in multiple senses). The following are starting points to consider. *Raise prices. Darryl Salerno, president of Second Quadrant Solutions, recommends growing profits by raising prices. It sounds obvious, but many start-ups and small organizations feel compelled to avoid rocking the boat and demanding more money for their efforts. Salerno says you can justify higher fees through specialization, innovation and adding more value. Rick Roher of Roher Public Relations recommends increasing fees annually. A good way to justify the price bumps is to keep a running tab of over-service hours (which will inevitably happen, especially early on). At the end of the year, show this to the client and say that, if they want to continue and even increase this level of service, it will cost them. *Lower Variable Costs. Salerno recommends these tips for cutting down your own expenses so that money can be funneled into new investments: Develop methods/systems to avoid duplication of efforts. Improve performance/efficiency for each assignment. Use the appropriate level for each activity. *Trim the fat. Underperformers will spell the demise of any organization or department, so eliminating them (or, if possible, improving them) is central to growing businesses-- and profits. Obviously, the best way to fix an underperformer is to never hire one in the first place. "Take more time to hire the star--not the ego," Rosenberg says. "One of the best strategies for growth is to hire the best people." But underperformers aren't limited to employees. Bad clients can be just as detrimental to a business' growth strategy. Identifying the best clients goes back to having a clear vision for where you want to end up. "Businesses fall down when it comes to identifying their ideal clients," Rosenberg says. "That's the most difficult part of what we do in terms of business development." *Lower overhead. The digital age has been a huge enabler in terms of reducing overhead. Use available technologies to: Allow employees to work remotely (thus reducing the amount of office space you need); Improve the speed of billing and collections; and, Reduce costs related to travel, equipment, support staff, etc. *Do a cost-benefit analysis. Salerno underscores the huge cost of over-servicing a client, and he identifies the most common causes of doing so: Poor budgeting: When it comes to budgeting, you must define the scope of work, the budget by activity and include very specific details. Working at improper levels: To avoid this, push work to the lowest appropriate level, train employees and encourage strong client relationships. Staffing to monthly retainers: Salerno recommends viewing budgets as annual, anticipating high activity months, accounting for the number of billable days/months and informing clients of monthly staffing levels. Take stock of these processes before you begin a project to avoid leaving money on the table or, alternately, wasting your own resources. PRN CONTACTS: George Rosenberg, grosenberg@therosenberggroup.com; Rick French, rfrench@fwv- us.com; Rick Roher, rsroher@roherpr.com; Darryl Salerno, darryl@secondquadrant.com Developing Employee Training Programs Your business can't grow if your employees don't, and grooming them takes a commitment to ongoing training and professional development within your organization. Ken Jacobs of Jacobs Communications Consulting recommends the following strategies and best practices when developing and executing an agency training program: Don't wait until you can afford training; in an employee-driven world, it's "train or perish." Think of training as an investment, not a cost. Get written and oral commitment from senior management. Assure that you are always in sync in terms of goals and deliverables. Update management regularly and ask for feedback. Ask the president/CEO to lead a training session at least once a year. Build support for training on multiple levels by seeking input on desired courses. This helps drive attendance and will clue you in on issues that you may not have been aware of. Link to goals, both in terms of the organization (strategic growth, income and profitability) and personal development (skills, client counseling, leadership, management). Start with a needs analysis by asking for client feedback on areas of strength, areas needing improvement, etc.; looking at personnel reviews; and analyzing PR and client industry trends and critical issues. Design training programs around specific areas: technical skills, team/account management, client management, business management, Web 2.0, leadership coaching, etc. Cultivate a learning environment: Make professional development part of performance reviews, require attendance and create opportunities for staff to apply their new skills. Seek participants' feedback regularly and modify future programs accordingly. Measure success through staff feedback, attendance, performance improvement based on evaluation and supervisor/client feedback.

Subscribe Now  |  Login


Comments Off

Deals of the Week

Get $200 Off PR News' Digital PR Conference

 digitalpr2015-180x150_updated
Join us June 1-3 where you'll hear from top brands such as Walmart, Miami Heat, Verizon and Ritz-Carlton on PR and communication best practices for the next wave of digital trends.

Use code “200off” at checkout to save $200 on the regular rate.

Get $50 off PR News' Book of Employee Communications

employeecommunications-180x150

In this 5th volume of PR News’ Book of Employee Communications, our authors cover more than 45 articles on crisis communications, social media policies, human resources collaboration, brand evangelism and more.

Use code “50off” at checkout.

Save $100 on a PR News Subscription

 

Let PR News become your weekly, go-to resource for the latest PR trends, case studies and tip sheets. Topics covered include visual storytelling, social media, measurement, crisis management and media relations.

Use code “SUBDEAL” at checkout.

Comments are closed.