Return on Values

Yesterday, I began to  look at ROI in a slightly different way and Philip Sheldrake and Tim Marklein maintained the argument for staying with a financial measure of public relations based on cash investment providing an incremental cash return.

For some PR trades, this is a perfectly adequate. One press release reaches a readership of a million people who in turn repay the client the cost of the press release and then some. The effect on the relationship between the organisation and the readers as well as tertiary publics such as journalists, editors and the process of WOM is ignored. Crude, better than nothing and informing management very little about effect.

Lets see if we can improve on that.

Suppose the PR practitioner was to ask the client:

• "Do you have values?"
• "Does your organisation have values?"
• "Do you invest time explaining, even re-enforcing, your values and the organisation's values to the Board?"
• "Do you and the Board invest time explaining your values and the organisation's values to your shareholders, employees, customers, vendors and other stakeholders?"
• "Do you use your values and the organisation's values to single out your brands among consumers/customers?"

I think that most managers would agree that their values and the values of the organisation are very significant competitive differentiators and that valued have value.

Now, lets make this harder. What if you ask the CEO:

• "What is the Return on Investment from your values and the values of the organisation?"

Ummm......

Now, in PR, we do have the answer.

Not marketers, not accountants, not business gurus.

Although many do recognise values as important even if they are not really sure how to identify values I cite: Charles Handy, Peter Drucker and Henry Mintzberg plus L Chen - 2009; H Donker 2008; M Chong 2010; J Cambra-Fierro & Y Polo-Redondo 2008; NL Trapp 2010 etc. etc).

In PR, grounded research (much better research than brand mangers have - and explained in this post), show that, among different segments of the public, there are drivers that build relationships between them and the organisation. They take the values of the organisation and where those values coincide with personal or group values, they find an affinity with the organisation.

An organisation can be described as a nexus of values and, to extent that they chime with the values of people or groups, there is a coincidence of interest.

We also know from a range of research and academic writing that organisations need to be able to understand the affinity between consumers and brand values to be effective and successful.

I cite, for example: JN Kapferer 2008; S Boo, J Busser, 2009; KL Keller & T Apéria 2008; S Srinivasan 2009; N Mizik & R Jacobson 2008; AE Cretu 2007; J Kim & JD Morris 2008 ....

For PR, deeper and more relevant measurement is to be able to identify the Return on organisational Values.

Does the organisation understand the values of its constituents? Does the organisation have values that chime with its constituency and in explications of its values, is it creating, sustaining and enriching positive relationships.

There is significant literature which explores the concept of Return on Values and much of the literature touches on matters like ethics, trust and reputation.

I cite for example: P van Beurden 2011; KS Cameron 2006; DA Waldman & MS de Luque 2006 LL Nash 2010 etc.

With rich, sustainable and supportive relationships, organisations will prosper both in the short and long term.

The return on investment in having clear, relevant, supportive and mutually acceptable values with the organisational constituency is a great deal more than cash out and cash-plus back. Yes, there is cash-plus back today but also cash-plus back tomorrow and with wider audiences. The real ROI will be seen to deliver real shareholder value, lower cost of doing business, a stable workforce with lower recruitment cost, enhanced vendor relationships and a more supportive licence to operate (Keller, Handy, etc etc).


Return on Values seems to be a much more sensible way of measuring PR.


Image from http://thefinancialbrand.com.

Brave new PR

In an exercise with some students we looked at a project in which the PR person was given responsibility for a university open day with the objective of increasing the number of student registration to 110% of capacity.

The university was running at less than 95% so this was quite a challenge.

The rules were simple. No budget constraints and stick to the brief.

Of course we undertook a detailed analysis of the primary publics and their interests and drivers: candidate students, existing students,the faculty etc.

By the time we had students wearing tee shirts with QR codes printed on them, it was obvious that the internal  communication activity was going to be critical.

To get fulsome buy-in from the dominant coalition and starting with the Principles, QR codes were liberally evident outside their offices linked to web sites about achievements, interests and Facebook friends to like selected with salacious care (every lecturer has glamorous Facebook friends - it goes with the territory).

In (classroom tests) it became clear that although the staff was completely oblivious to the secrets of QR codes, the students had no such barriers. Here was a subversive form of communication that was just right for the target audience but also really useful to achieve in-house buy-in (after all when you come out of your office and a bunch of giggling students are pointing phones at the notice boards, even the crustiest academic is curious).

The ideas for the programme, now an interactive university wide exhibition, continued as exemplar courses were given the QR treatment. Film and Vision has a wonderful challenge to use their studio to create YouTube events (inspiration came from here)  for visitors providing attendees with QR codes in hard and soft copy. The stars in the show, academics, students and visitors alike were offered staring roles.

Imagine proposing to a librarian that the PR department wanted to deface books with QR codes converting them into interactive documents incorporate text pictures and video. A deeper richer experience and above all fun. Perhaps even creating Slate books.

Meantime the maths majors were (hypothetically) working on creating a virtual environment about a new form of seminar with the lecturers in class and the students in the bar (sounds credible to me).

A new way of annotation for course work was thought to be a good idea for visitors to the open day.

The whole university was offered help to work on Wikipedia entries with each paragraph having its own QR code with free help from local wikipedians.The resulting codes were photo-shopped into a walk through department exhibition using a really appealing invitation for the young men expected to take an interest

The chemists had a ball developing Avatar presented activities.

Of course all universities need to keep local communities involved and a small team worked on how they could create web presence and interaction between visitors, students and the community and local enterprises. In addition there was a case for creating new ways to stay in touch with school and university alumni.

Having scoped out what was possible, the next major consideration was reaching out to the target audience. Direct contact, involvement with schools, local press, radio and television and, of course the places where young people (and their parents) go. Every new media idea that the class had come up with had a novel, interesting and compelling application for enhancing media relations and extending interest and coverage.

Progressively, this imaginary event  became bigger developing ways that people could interact with the open day exhibitions using Augmented Reality.

The need to be able to use print, email, personal visits, social media, traditional media, shops, clubs and community institutions became significant. Detailed analysis of ways to reach the, now growing range of internal and external publics needed careful analysis. From Twitter to Linkedin, building lists and approaches needed careful planning (and careful risk analysis too). Timetabling the plan was becoming harder.

The wonderful thing about students is that they suddenly come up with a new, and compelling idea.

The idea that so many communication capabilities came from the internet of things inspired by the Corning video brought a whole new range of new communication ideas.

To be able to attract a Corning demonstration, there would be a need to make the open day bigger, requiring wider involvement of the local, and, notably, commercial community.

There are two serious drivers for commerce: incremental sales or, alternatively lower cost.

What, for example would happen if these truly exciting events could extent to the wider community? What self respecting club could resist a QR code enhancement - if only on tee-shirts and wearable transfers, badges, table mats, drinks and even the bands. What is all these electronic gizmo's were all branded to keep promoting the university?  Can the open day become an interactive community interest in shopping malls and, in doing so, increase footfall?

Could visiting prospective students apply for a course using Bump technology? Could a local manufacturer use the new knowledge that the university was acquiring in communication skills for commercial gain? Is mobile phone bump technology helpful in replacing office access passes (Bump payment is now passée) and at the same time a message board on employees phones as part of the process adding internal employee communication to access control. Communication was invading and enhancing ordinary corporate function.

As the conversation progressed, each new application, every new idea offered new and interesting tertiary opportunities to engage a huge range of media from Facebook to YouTube and every news channel going.

By now, a simple open day, a normal PR activity, was becoming an agent for organisational change.

It was creating new and additional motivations for the establishment, lecturers, students and the community.

The kind of thing they would want to do because it is fun.

What we witnessed was where advertising, sales promotion and PR blur into engagement. Relationships that needed careful and structured management to gain the most potent effect.

Congratulations to the creative students at  Escola Superior de Comunicação Social.

Exhausting isn't it?

Image from http://listverse.com/.

Can PR use ROI as a form of measurement? Its harder than you think

This week three academics have presented challenges to the PR academic community.

Professor Tom Watson at Bournemouth, Richard Bailey at Leeds Metropolitan University and my co author Philip Young at Sunderland have all made interesting contributions to PR thinking ahead of the the CIPR’s new Research and Development Unit (R&DU)  meeting next week.

Before entering into the debate on Grunigian theory presented by Richard and Philip, I wanted to respond to Tom's point.

Tom makes a point: "I still have doubts as to whether ROI, other than in a strictly financial format, can be re-purposed into a more general expression of value creation or contribution to organisational efficiency.  Business managers understand what ROI is, so why would they accept a mixed-concept PR ROI."

It is important. As AMEC boldly goes for some form of measurement of PR providing a return on investment. There seems to be a belief that ROI is a simple idea.

It would seem there is a belief that ROI is a financial measure. Of course it is not. ROI is a profoundly Public Relations measure.

Lets have a look at what ROI is. It is defined in accounting terms as:

(Gain from Investment minus Cost of Investment) divided by (Cost of Investment)

Can we pause for a moment and explore what 'Investment' means. Investment requires that an organisation has cash flow, capital reserves or some other asset that can be deployed as an investment.

Organisations comprise three principle assets: capital, proprietary process and/or service and  relationships. The acquisition of capital, and development of process or service; 'vision, mission and corporate objectives' (Kaplan 2001) are a function of relationships.

It follows that to invest in anything, an organisation needs relationships of a nature that can be invested.

So lets re-draw what ROI means:

(Gain from Relationships minus Cost of Relationships) divided by (Cost of Relationships).

ROI is profoundly about relationships. In an industry called 'Public Relations', this could be of interest. In a sector called 'marketing communications' it will be pivotal because Marcoms depends on 'public relation' to optimise relationships to create capital and cash flow to pay for this, a special area of relationship management, namely marketing. In principle the same applies to the trade of 'Corporate Affairs' and other trades associated with 'Public Relations' in practice.

Which takes us back to Richard and Philip and the Grunigian excellence model coming from systems theory. We can, if we desire stay with the systems theory view because already have a grounded reserach into the nature of relationships in the work of Bruno Amaral (2009).

This, Amaral, hypothesis is that relationships  are formed at the nexus of values and using latenet semantic analysis was able to show that where there is a nexus of semantic values there is very strong evidence that they are central to the formation of convergent relationships.This empirical research supports conclusions as to the impact of public relations as relationship management offered, by  Ledingham and Bruning (2002).

Convergent values relationships have some resonance with the Grunigian position of Publics forming round issues but in the Amaral study, it was less issues as values that were key which is a broader construct.

What we have done is to extend and develop the ideas of Grunig and Ledingham and Bruning to identify an empirically based idea of what public relations can be which accommodates both theoretical perspectives.

Can we now re-draw ROI yet again.

(Gain from Nexus of Values minus Cost of Nexus of Values) divided by (Cost of Nexus of Values).

Of course, I have only taken one view as to the nature of relationships namely the empirical research of Bruno Amaral. There will be others drawn from Psychology to the Evolutionary Sciences.

What I hope to have shown is that the theoretical concepts of Public Relations have moved on and that we can, should we wish, pursue ROI but that it will require more than an AMEC Commission to come to any meaningful conclusion unless there is a great deal more by way of, notably academic, research.

And the there is the problem of getting such ideas into the heads of the PR industry's clients. But that is another story.









RS Kaplan  Nonprofit management and Leadership, 2001 - Wiley Online Library

Excellence in Public Relations and Communication Management, 1992  IABC Research Foundation Edited by James E. Grunig

Relationship management in public relations: dimensions of an organization-public relationship (1992) John A. Ledingham and Stephen D. Bruning Public Relations Review Volume 24, Issue 1, 1998, Pages 55-65

The search for hidden meanings

Throughout written history, people have engaged in finding the hidden meaning in writing.

Fascination at the hieroglyphs on the walls ancient Egyptian temples and burial sites extends back well before  4 PM on November 26, 1922 when Howard Carter’s search for hidden meanings resulted in the discovery of the 3300 year old and untouched tomb of 19 years old king Tutankhamun .

Today, we are even more fascinated with exploring our written (and spoken) language.

And it all comes down to what is known as Part-of-speech tagging (POS tagging or POST).

Most of us have done it at school by identifying words as nouns, verbs, adjectives, adverbs, etc.

Back when the Beatles were at their peak, America and its allies were embroiled in the Vietnam war, Dr Christiaan Barnard carried out the world's first human heart transplant and The Six Day War was fought in the Middle East, NASA launched an unmanned Apollo 4 test spacecraft and Britons got their first colour television programmes . But in that same year the one development that affects more people today and will do in the future is the work of Henry Kucera and W. Nelson Francis.  They published their classic work Computational Analysis of Present-Day American English (1967), which provided basic analysis about words in texts on what is known today simply as the Brown Corpus.

Henry Kucera and W. Nelson Francis did more complicated analysis than getting computers to find nouns and verbs but the principle is the same. It is a process largely based on relationships with adjacent and related words in a phrase, sentence, or paragraph. 

Once performed by hand, POS tagging is now done in the context of the son of the Brown Corpus, computational linguistics. It uses algorithms which associate discrete terms, as well as hidden parts of speech, in accordance with a set of descriptive tags or forms of description or, more recently, that are created as they are found ‘on the fly’.

The reason that Kucera and  Francis work is so important is that we have built a whole new form of society on this idea.

Clever scientists have used this idea of extracting hidden meaning to develop a new form of internet.

One of these ideas came from three academics Scott Deerwester, Susan  Dumais, George Furnas, Thomas Landauer and Richard Harshman (1990). They outlined how to analyse relationships between a set of documents and the terms they contain by producing a set of concepts related to the documents and terms. Called Latent semantic Analysis (LSA), the idea assumes that words that are close in meaning will occur close together in text.  

This idea is used by all manner of analysis programmes and helps find those hidden meanings.

In their paper they says “...Thus while LSA’s potential knowledge is surely imperfect, we believe it can offer a close enough approximation to people’s knowledge to underwrite theories and tests of theories of cognition.”  Since 1990, academics have come a long way and accuracy is getting ever closer to social reality. 

Today, the use of semantics makes the Google and Bing web search algorithms more accurate, helps newspaper journalists find the most authoritative sources for information and informs the top companies about events and their drivers to optimise financial, marketing and communication decisions.

Remember Kristen Urbahn’s story I blogged about three weeks ago? It has lots of hidden meanings. Using Extractive.com’s special search engine Kristen can find out about the relationships between different parts of the story (using automated Part of Speech tagging).

The results show the nature of some of the significant words:

├PERSON (46) │├SCREEN ACTOR (4) ││└ Kathy Griffin (4) │ ├ she ││ └ her  │├US CABINET MEMBER (1) ││└ Donald Rumsfeld │├US PRESIDENT (3) ││└ Obama (3) ││ ├ Obama ││ ├ Obama ││ └ his  │├ Brian Williams │├ Dan Pfeiffer │├ Jill Jackson (2) │ ├ Jill Jackson │├ Keith (6) │ ├ Keith Urbahn │ ├ He │ │├ Kristen Urbahn (13) │ ├ Kristen Urbahn │ │ ├ her │ ├ Kristen Urbahn │  │ └ Kristen  │├ Maggie Fox │├ Osama Bin Laden (6) │ ├ Osama Bin Laden │ └ Bin Laden  │├ Osama Bin Ladin (5) │ ├ Osama Bin Ladin │ ├ He │ ├ Osama │ └ he  │└ Sohaib Athar

├LOCATION (14) │├GPE (13) ││├COUNTRY (5) │││├ Afghanistan │││├ Pakistan (2) │││ ├ Pakistan  │││└ US (2) ││├CITY (4) │││├ Abbottabad │││├ Denver │││├ Guardian │││└ San Francisco ││└US STATE (4) ││ ├ Kansas ││ ├ South Carolina ││ └ Washington (2) ││  ├ Washington ││  └ Washington  │└ Wiltshire ├ORGANIZATION (21) │├COMMERCIAL ORG (16) ││├MEDIA ORG (7) │││├BROADCAST NETWORK (5) ││││└TV NETWORK (5) ││││ ├ BBC ││││ ├ CBS ││││ ├ CNN (2) ││││ └ NBC │││├ New York Times │││└ Washington Times ││├ Defence ││├ Google ││├ Social Media Group ││└ Twitter (5) ││ ├ Twitter  │├NON GOVERNMENT ORG (2) ││├ Al Qaeda ││└ Republican Leaders Office │└UNIVERSITY (3) │ ├ Preston University │ ├ University of Kentucky │ └ Yale ├CONTACT INFO (1) │└URL (1) │ └HTTP (1) │  └http://goo.gl/qHnFH

├OTHER (18) │├FACILITY (4) ││└BUILDING (4) ││ └ White House (4) ││  ├ White House Communication Director ││  ├ White House  │├LINKED OTHER (11) ││├ Capitol Hill ││├ Christian ││├ Creative Commons ││├ Dachshunds ││├ Internet ││├ Internet ││├ Mobile ││├ POTUS ││├ President Obama ││├ Royal Wedding ││└ The New York Times │└SOFTWARE (3) │ └ Facebook (3) │  ├ Facebook  ├DATE-TIME (16) │├DATE GENERAL (8) ││├DATE (2) │││├ Aug. 18, 2009 │││└ May 1 2011 ││├DAY OF MONTH (1) │││└ 1 May ││├MONTH NAME (1) │││└ May ││├RELATIVE DATE (2) │││├ months ago │││└ the evening ││└YEAR (2) ││ ├ 2006 ││ └ 2011

│└TIME (8) │ ├ 10:30 p.m. Eastern Time │ ├ 10:40 p.m. │ ├ 10:53 │ ├ 11 p.m. │ ├ 11:35 │ ├ 4pm EST │ ├ 9:45 p.m. │ └ from 10:45 p.m.-2:20 a.m. └NUMERIC (20)  ├MEASUREMENT (4)  │└DURATION (4)  │ ├ Five years  │ ├ days  │ ├ former  │ └ the hours  ├NUMBER (11)  │├ 2.0  │├ 3,000  │├ 5,000  │├ 7.24  │├ millions  │├ more than 185  │├ one  │├ one  │├ six  │├ three  │└ two  └ORDINAL (5)   ├ Third   ├ first   ├ first   ├ second   └ third

Here, then, are the key elements that can be extracted from the blog post.

Two people from the 18^th and 19^th centuries now star in this story.

Thomas Bayes (1702–1761) was the son of London Presbyterian minister with a clever mathematical brain. He came up with what can be described as a way to look at these hidden parts of text and other content and find out the extent to which a particular inference is not true. For example Twitter is a big part of the Kristen Urbahn story but it is by no means the focus of the events in Pakistan.  It was just an (important) means by which information was shared across the globe. Thomas’ clever mathematics is the means by which it is possible for computers to make decisions about the probability that information can be relied on and, in that case, the role of Twitter in news distribution.

With enough information and generous computing power, of which modern man has plenty, Bayesian probability offers something like a partial belief, rather than a frequency. This allows the application of probability to all sorts of propositions rather than just ones that come with a known structure. "Bayesian" has been used in this sense since about 1950. Advancements in computing technology have allowed scientists from many disciplines to pair traditional Bayesian statistics with other techniques to greatly increase the use of Bayes theorem in science. Now, computers can both learn from experience and are beginning to be good at prediction.

Twitter was important for the Urbahn story and so, the software might tell us, Twitter will be significant for other stories in the future.

It is such techniques that modern managers need to hand if only to be able to discover emerging trends in communication and or news and events.

Fifty years after Thomas death, George Boole  (1815 – 1864) came into this world to give us all a great way of discovering information.  George (who was married to an equally mathematically brilliant wife Mary and who was the nice of the man who gave Mount Everest its name), gave us Boolean algebra (1854). Today most people know it because it is useful when searching for information using search engines. The Boolean operations AND, OR, and NOT help narrow down searches to get more closely to the facts we seek (Kristen AND Urbahn OR Forcht).

But, the use of AND, OR, and NOT in mathematics and computing has other applications and when combined with Bayesian probability (and other similar math) which means that computers can be used to make accurate, predictive and related inferences and learn, for themselves, from the results.

In practice, we find useful tools to give us insights into events.

For example http://twitris.knoesis.org/  (created at Kno.e.sis at the College of Engineering and Computer Science at Wright State University) provides us with an ontology, related Tweets, links to highly relevant web pages, a chart of Tweet rates and much more.

In practice, a manager can keep a close eye on mentions of a company, brand or product and the reputation drivers behind the Twitter stream.

No one is pretending that business managers need to understand all the technologies. There is a need, however, to know that using such advances is now becoming central to modern management and communication.

Bibliography

Kucera, H. and Francis, W.N. (1967) Computational Analysis of Present-day American English Journal: Neuroimage - NEUROIMAGE

Scott Deerwester, Susan T. Dumais, George W. Furnas, Thomas K. Landauer, Richard Harshman (1990). "Indexing by Latent Semantic Analysis". Journal of the American Society for Information Science 41 (6): 391–407

 Boole, George (2003) [1854]. An Investigation of the Laws of Thought. Prometheus Books. ISBN 978-1-59102-089-9.

Gruber, Thomas R. (June 1993). "A translation approach to portable ontology Specifications". Knowledge Acquisition5 (2): 199–220.


Further Reading:
Introduction to LSA http://lsa.colorado.edu/papers/dp1.LSAintro.pdf
Semantic Inference in the Human-Machine Communication http://www.springerlink.com/content/ju71rcn9pq0wcmy3/
Continuous Semantics to Analyze Real-Time Data http://wiki.knoesis.org/index.php/Continuous_Semantics_to_Analyze_Real_Time_Data
Web semantics and ontology By Johanna Wenny Rahayu http://books.google.com/books?id=K7yFJVu8NDYC


Twitter, Facebook, and dozens more sources come through Gnip's API, normalized and enriched with metadata. http://gnip.com/

Hieroglyph picture: http://apworldhistorywiki.wikispaces.com/Egypt+(complex)+(69-80)+2