According to "DefineThat," a snappy little service on the
Internet, public relations is "a form of communication primarily
directed toward gaining public understanding and acceptance. Public
relations usually deals with issues rather than products or
services, and is used to build goodwill with public or employees.
Examples of public relations are employee training, support of
charitable events or a news release about some positive community
participation."
Sounds simple and straightforward, doesn't it? Unfortunately,
two recent turns of events show that while some PR execs talk the
talk, they don't walk the walk. With that in mind, we look at
how two of the largest PR firms have dealt with their own
crises. As per Ketchum, imagine if your client
got embroiled in a major media controversy. Would your first advice
be to blame someone else and then say no to every request for
comment or documentation? Hardly. These very pages have been filled
for years with highly respected representatives of our industry -
some of whom have worked for Ketchum - recommending the
fundamentals of crisis communications: Own the problem. Be
forthright, contrite, and honest. Give out as much information as
you possibly can. Did Ketchum do any of those things? Hardly. As a
result, the scandal sparked by Ketchum's hiring Armstrong Williams
to plug the Bush administration's "No Child Left Behind"
school-standards law is in its second month and shows no sign of
abating.
If extent and duration of crisis is any measure of success,
cooperating with the authorities definitely helps. A recent
Nexis search showed that Ketchum's crisis was
garnering about 40% more coverage than
Fleishman-Hillard's, despite the fact John Stodder,
the partner in charge of the Los Angeles office's "public affairs"
practice group, was indicted on federal fraud charges alleging he
participated in a scheme that resulted in fraudulent bills being
submitted to the Los Angeles Department of Water and
Power.
I've heard a lot of comments about the damage the stories by the
New York Times and other mainstream news outlets have done to our
industry, but the sad thing is, it's not the media coverage of
these crises that is causing the damage - it's our own
behavior.
Contact: KD Paine, CEO of Durham, N.H.-based KDPaine
& Partners LLC, can be reached at 603.868.1550, [email protected].
| PR News Report Card: Ketchum |
|||
|---|---|---|---|
| Criteria | Grade | Comments | Advice |
| Extent of coverage |
F | This is a story that just won't go away. It's made headlines around the world, and further investigations and accusations, particularly among the blogging set, are keeping it alive. |
Saying "no comment" seldom helps, but the consequences are worse than ever now that the blogosphere is a significant force to be reckoned with in any crisis. |
| Effectiveness of spokesmen |
C | I'll give Ray Kotcher credit for trying his best to mitigate the crisis, but it really didn't help much. A recent Op-Ed explanation was roundly critiqued as obfuscation among agencies and media alike. |
We can all learn from Sen. John McCain. Because he speaks like a human being, everyone listens. Spokesmen in a crisis need to speak "human," not "spin." And if you are writing your response, it still needs to sound like ordinary speech and not a well-crafted memo. |
| Communication of key messages |
D | Ketchum waffled in the early days, first blaming Williams and then accepting part of the blame. Unfortunately, the media were much more likely to cover the waffling than any of the messages. It certainly doesn't help that Ketchum's Web site totally ignores the issue. |
In the early days of a crisis, your actions will be remembered while your words will not. Remember that the first place people go for information is your Web site. If you don't address a crisis there, people will assume you have something to hide. |
| Management of negative messages |
D | In its attempt to avoid more negatives, Ketchum redacted a lot of the billing statements and other documents requested by various groups investigating the extent of the "pay-to-pitch" scandal. This only resulted in more bad press. |
"Transparency" isn't just a buzzword. In the wake of Enron, people expect their institutions to be far more transparent than they've been in the past. Only with transparency can you rebuild trust with your constituencies. |
| Impact on clients |
F | If I were a Ketchum client, I would wonder what the impact was on Ketchum's ability to pitch stories effectively in the future. |
Beware of the law of unintended consequences. I'm sure there was a perfectly good reason why Ketchum's initial statements blamed the media and Williams, but it certainly didn't help the agency's future relationships. |
| Impact on shareholders |
C | Omnicom (parent company of Ketchum and Fleishman) must be roiling from all the unwanted attention. Whether Omnicom shareholders will notice is another question. Its stock took a dive after the scandal broke but it seems to have recovered. |
The good news is that most investors aren't nearly as fascinated with PR crises as we are. |
| Impact on employees |
F | The blow to Ketchum's credibility has to affect all of its employees, whether they're dealing with the media and clients or just talking to friends about the crisis. |
Before you go into ostrich mode and start "no comment"-ing all over the place, carefully consider the consequences, not just externally, but internally. |
| Overall score | F | It's truly amazing how a good PR firm could have so steadfastly ignored the advice it must give out to clients on a regular basis. |
Do we really need to say this again? Be honest, be forthcoming with information and be contrite. Don't blame others and accept responsibility. Do as Ketchum says, not as it does. |
| PR News Report Card: Fleishman-Hillard |
|||
|---|---|---|---|
| Criteria | Grade | Comments | Advice |
| Extent of coverage |
D | While the DPW/Fleishman crisis has gone on for a lot longer than has the Ketchum crisis, it hasn't generated anywhere near the attention. In fact, most of the coverage has been in the trades and in L.A., and not the national press |
All politics is local and, if there's anyway you can contain a crisis and keep it local, you will be infinitely better off. |
| Effectiveness of spokesmen |
C | CEO John Graham's internal memo that was leaked to the St. Louis Post Dispatch was the one ray of hope in an otherwise appalling display of no- comment-itis. Given the nature of the charges, the head of the office accused of fraud was hardly the most effective spokesperson. |
As much as it may be counterintuitive to your efforts at containment, bringing out -- or at least leaking the opinions of -- the big guns may be your most effective tactic. Clearly, using the head of the local office in this case was inappropriate. |
| Communication of key messages |
D | Unfortunately, Graham's memo surfaced a little late in the process for the agency to get the message out that fraudulent billing practices went against the ethical and moral codes of conduct for the agency. |
Get your messages out via the most credible spokesperson as early in the process as you possibly can. |
| Management of negative messages |
F | Clearly, the L.A. Attorney General's office was driving the discussion, because most of the stories were generated in response to press releases from that office. It didn't help that a mayoral election was underway and that this particular scandal regularly surfaced as a campaign issue. |
Remember that, in any crisis, there are two sides, and you can count on your enemies to make the most of them. Sometimes your competitors will boldly take advantage of your crisis, as Sun Microsystems did when it circulated a press release saying it would capitalize on market confusion following the departure of Hewlett- Packard's CEO. In other cases, there may be an aggressive D.A. looking for re-election. Either way, you need to put yourself into the head of the enemy and figure out what its next moves might be. |
| Impact on clients |
F | It's one thing to hide who is paying for your press releases; it's very different to be accused of fraud. If I were a Fleishman client, I'd be going over every bill with a microscope and an accountant by my side. |
Take action early to distance yourself as far as possible from those accused. It is astounding that no heads rolled until just before the indictment was announced. |
| Impact on shareholders |
C | The long-term impact of the scandal on the PR profession still is not known, but when the local government bans PR contracts all together, shareholders have to be concerned. Of course, given that Omnicom owns both Ketchum and Fleishman, shareholders may be a bit distracted by the more visible crisis. |
Chances are good that your shareholders will be among the first to pay attention to your crisis. And if they want more information, they'll go to your Web site first. Needless to say, you won't find any information on the Web site, but you will find information on its new "Government Marketing" practice. Not a good idea when the city of L.A. is kicking out all PR agencies because of problems with your billing. |
| Impact on employees |
F | Employees were among those accused of fraud and, until the entire story comes out, many will be unfairly tainted by the scandal. |
When your chief assets are your employees, you should make every effort to shield them from the damage a crisis can inflict. |
| Overall score | C+ | I give Fleishman high marks for cooperating with the investigation, but I knock off a point for every "no comment." |
When investigations are ongoing, it's easy to justify not commenting. Just beware of the consequences. |