Tuesday, July 19, 2011

How can we make the PR industry more productive and profitable?

Mac Funamizu

Over the weekend I stuck my neck out and suggested that the PR industry needed to be more selective in its activities to release practitioners from the low paid, low productivity trap, short term future it faced by being so immersed in press relations.

Yesterday, I suggested that the industry is a poor performer among a range of sectors with significantly better productivity.

Peter Smith took me to task. He asked if I had any solutions!

In this post I want to extend my brief reply to him in the CIPR group in Linkedin. Here I explore some of the ways I believe the PR industry can escape the low cost trap it has got itself into and evolve into a much more powerful profession.

I did make the point that to see how we can enhance the profession, there is a case for looking at different sectors to see what they have done.

At this time, as the Fourth Estate, Parliament and the Police squabble of the role of journalists and their place in PR, we too can have the same debate. There is a good case for PR to look much more closely at the value of the involvement of journalists in PR. Much of the argument I exercised in my post last Saturday. Today, I would extend those arguments a little. There is a place for a form of press officer to be employed in building and maintaining relationships between and organisation and its press (radio and TV) news journalist publics. They can be drawn from the media, re-trained and deployed. In the same way, there is a case for similar skills in online video media, text based social media, Website design and deployment, SEO, social and event organisation for face to face relationship management, Augmented Reality, widgetry and so forth.

No doubt, as the profession evolves clients will expect PR agencies to have such skills available as a matter of course.

However, having such skills available will not achieve the sea change needed by the PR industry.

First the industry must be much more ambitious in what it wants to achieve. It might, for example set itself the target of being in the top quartile of economic sectors by way of productivity (using all three of the methodologies usually associated with economic productivity evaluation).

Secondly, the industry might, just as other industries have done, go to the PR and management colleges to identify how the industry can seek more productive services, make existing products and services more effective (profitable), train for and deploy them.

Thirdly, the PR sector needs take corporate management and practitioners along with it. No mean task and there will be exemplars and detractors and huge resistance.

The Chartered Institute of Marketing now includes a good module on Reputation Management as part of its Diploma. There is a good case for the PR institutions such as the CIPR, PRCA, IABC and the PR universities to make sure that senior management (the people who employ marketing directors/mangers) understand that press relations and reputation management are only a small part of the PR whole.

I do not want this post to be too overshadowed by the News of the World, hacking story but, it is by no means a co-incidence that a policeman thought that a News of the World journalist was his answer to solving his PR needs. Had the PR industry made its role clear, he would not today be appearing before a Parliamentary Committee.

Of course, it is reasonable to ask what kind of changes would David Phillips envisage that could make so much difference? Is this just whistling in the dark as the PR industry looses face because a bunch of ill informed politicians and policemen joined some equally poorly informed industrialist hired inadequates to 'do their PR'?

In all I would like to see a three fold increase in PR productivity over three years.

The plan will have to consider where early improvements in current practice should be made; where change can be implemented with lowest disruption and optimum return and finally how the sector can move towards greater reliance on advanced productive diversity in practice as well as people.

This means that:

1. A large proportion of the improvement would have to come from PR as it is practised today. That is, largely predicated on press relations and events management.
2. A range of enhanced value activities will need to be exploited which will inevitably mean a move up market into management consultancy and a move sideways to create greater breadth and depth in relationship management (and thereby reputation and brand enhancement).
3. A very significant deployment of opinion to show the value of a holistic approach to management of relationships by the most senior management of, even the largest, institutions.

There is a case of examining other industries which have been in a similar dilemma. Can the PR industry look at other sectors to get some idea of what is possible?

I was working in Bradford in the 1960's when the textile industry was imploding and in manufacturing in the 1980's when we saw carnage in areas like machine tools, car manufacturing and many others.

As I alluded to in my post in Linkedin, the companies and whole sectors that came through these times did a number of extra ordinary things.

Today, the apparel industry in the UK is strong and the fashion industry is worth £21 billion.

One only has to think of the high levels of productivity and quality achieved by the motor manufacturers by Nissan in Sunderland and Honda in Swindon or the Airbus aircraft manufacturing capability to see just how much can change when the effort is put in.

The £100 billion internet industry and the highly productive music industries in the UK are examples of how success can come out of adversity once the people involved realise the opportunities available and the production and change that is required to become globally competitive.

In examining what other sectors have achieved, can PR learn the lessons and move forward?

I can imagine some of the first things that the PR industry can do.

The first is to look at under performing activities and either ship them out to low cost suppliers or automated the process.

In almost every PR office and agency in the land there are interns. Many of them do lowly jobs like filling envelopes, maintaining libraries of magazines and newspapers, prepare clip books and other tasks that consume time and are labour intensive.

The task here is to look at the lowest paid people, examine the tasks they perform and the reasons for them and the enhance such activities to become less labour intensive, higher value and profitable.

If, for example the library activities (press clips, evaluation reports and magazine libraries) of interns was transformed into corporate intelligence, and insights to allow deeper understanding and acquisition of knowledge for all the client board of directors, the mundane jobs would become interesting and very valuable. So much of these tasks can be transformed using modern technologies.

At the same time some activities can be shipped out such that, for example, filling envelopes could be part of corporate social responsibility programmes giving work to the most disadvantaged in our society.

Having turned the intern's most dreary work into a highly significant, intellectually challenging and adsorbing services and removed the lowest value add activities, an immediate advantage is available to every PR office in the country.

What then of the next lowest paid member of staff. Here again, close examination of the activity, its transformation from low value to highest value can be achieved with imagination and application.

A typical example is the (I really can't believe I am writing this) chore of researching and building media and other lists.

Part of the role of the new intern activity will identify those clusters of interest (the nexus of values) and the people with particular interest in such values. Such activities are part of semantic search. If the Bank of England can use such capabilities (to identify economic trends) using Search and Twitter trends, so too can the PR industry. Its not just Twitter but many other forms of expression in media as diverse as computer games, motives for attending events, other social media, corporate transparency and other on and off-line activities that can transform the idea of finding opinion forming and behaviour enhancing activists.

From such developments, the junior account executive's life is transformed from magazine list building into transformative PR campaign management. From just lists of magazines and journalists the activity engages real people and the their motivations. The work of 26% of practitioners paid less than £25,000 per years (according to the PRW/PRCA sector report) is transformed into activities worth as much as a £40,000 a year Media Manager/account Director. The productivity gain is considerable.

This kind of activity is iterative. Take the lowest value activity and develop it into the highest value added activity until you reach the highest paid executive in the organisation/department and productivity enhancements will be extraordinary.

High on the list of priorities in the 70's was quality. Total Quality Management which examined those areas which had lowest quality was worked on until it had the highest quality returns and iteratively, all activity was examined and improved. This was followed by Right First Time. This "do it one and do it right" principle would cut approval costs very quickly.

In another time and in another industry, we went through such challenges and can now apply them to PR.

The first problem we faced then and PR faces now is being able to measure quality.

In almost every PR office you will hear the baleful cry of 'I am waiting for press release/tweet/blogpost approval'. Here is a measure of quality. Approvals, if they are needed should be a joy to give not a chore for the manager involved. Cutting number of people involved and approval times will cut costs significantly.

Imagine, if you will, measuring the uptake of press releases without the awful and demeaning phone round. "did, you receive my press release?" THAT sort of phone call is a symptom of poor quality. Measuring it will immediately focus attention on a productivity leaching activity.

Developing the 'Right First Time' capability is only one part of the process. The other is in motivating the approver such that approval is quick and a joy.

Some of this activity will, no doubt, include that good old fashioned process of delegating up the management chain. Most people delegate down and that is a PR mindset. Try working the other way round.

One of the other major developments we learned all those years ago was the need to be in the vanguard of innovative practice. In PR there are a lot of things we can do to innovate and at present, there are many ways we can enhance corporate relationship management with very exciting new approaches to PR.

I hinted at some of the areas we can look into. At the tactical level there are exciting opportunities in areas such as online video media, text based social media, Website design and deployment, SEO, social and event organisation for face to face relationship management, Augmented Reality, smart phone games, widgetry and many more. They all interlock. Would you believe that journalists like widgets too?

However, such activities are quite mundane when looking at what is available just over the current horizon.

In the development of the high value added sectors in our economy, decisions are constantly being made as to whether it is more effective to make of buy. This means that the PR industry may well become a major economic driver in its own right. It will need a much bigger supply base and that is no bad thing and a big advantage for the sector. The upstream economic value of say the UK Space industry is such that it is needed by governments to enhance national GDP, employment and global influence.

This is another advantage of making the PR industry more productive (as though growth, profitability and global leadership was not enough).

But the industry does have to go much further.

Being not the participant but the initiator of developing vision, mission, objectives and values at the most senior level is a start and when applied to organisational relationships is quite a challenge. It is a challenge that the PR industry is quite capable of meeting.

As greater transparency becomes the norm (and here we get back to one of the outcomes to anticipate from the Hacking scandal) and transparency technologies gain in momentum (a consequence of the semantic web and the Internet of Things), the PR sector will become ever closer to being the expert in developing facilitators as well as drivers of corporate effectiveness.

To be able to do these things, the overarching need is to re-look at the data from the PRW/PRCA research and take from it the urgent need to increase PR sector productivity by factors.

Image by Mac Funamizu http://petitinvention.wordpress.com