Six years later, we are talking about value

I was watching Derek Halpern talk about blog posts on YouTube and he suggested re-visiting old posts. I did.
The oldest talked about valuing relationships.

Here it is:

We have moved on. In six years, we have some better views:

Now, of course we are getting closer to having a form of ROI which I outlined in June.

In this instance, I did propose a form of valuation that would be effective for all types of PR and which would provide a value for public relations. We do have tools that can help with this approach and that would be useful.

So now who is going to work on creating some real (Open Source) facilities for the PR industry to share to be able to measure its effects?

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

How can academia serve the emerging PR paradigm?

In Public Relations there is a tendency for academia to explore the nature of practice. We seldom become involved in broader blue sky research. As a consequence, this powerful and significant sector tends to respond to events with poor academic consideration of the much deeper fundamentals that drive future or even emerging practice.

We do have a present opportunity to look more deeply than ever before into the nature of relationships, reputation and the values that attach to tokens such as polity, brand and emerging social trends.

This paper will provide an approximation of the value of the internet economy across Europe. It will explore the extent to which social interaction is significant and will provide a view of the relationship value of social interactions online.

From this base,  the paper explores approaches for the PR sector to examine how it can identify the approaches to fundamental research into the nature of relationships as they pertain to the organisation with particular emphasis on the changing nature of online relationships

The value of the internet across Europe

Research commissioned by Google and undertaken by the Boston Consulting Group  (The Connected Kingdom 2010) suggested that, in the UK, internet activity contributed £100 billion per year (€ 650 bn) in 2009. This value is equivalent to approximately  7.2% of national GDP. Growth was estimated at 10% per year.

Some 60% of the UK internet economy consists of consumption with consumer e-commerce  at about £50 billion,  £10 billion contributed by  internet service providers and device access and 40% being government and private investment in internet related technology.

Using data from Internet World Stats (http://www.internetworldstats.com/stats4.htm ),it is possible to offer a Europe wide perspective. Using the data of the UK’s 51 million people online (82.5% of the population) and assuming that every person online across Europe is as active online (rounding down the data and ignoring European wide growth in 18 months since publication) it is not pretentious to estimate a European internet economy at € 1.5 trillion.

Of this figure consumer e-commerce would represent some € 750 billion.

The nature of social interactions

Robin Dunbar (1996) , writes: “Primates in general differ from other species of animals in respect of their social skills and there is now considerable evidence to suggest that primates owe their large brains to the need to manage and manipulate large quantities of information about social partners.

“Some of the evidence for this is provided by the fact that, in primates, group size correlates directly with neocortex size: living in larger groups requires proportionally more ‘computing power’ to keep track of what is going on. In contrast, purely ecological variables do not correlate with neocortex size once the effects of group size have been statistically removed. The primate brain is a social brain.”

Humans are genetically programmed to be social.

For humans with brains designed to communicate most effectively in, relatively large,  groups of about 100-150, there is a need for more brain power than is available to do what other primate do. They use grooming.  People use a more energy consuming capability, namely, language.  If language evolved to allow us to gossip, we ought to see evidence of this in what people talk about in informal conversations with friends and acquaintances. And, indeed, Dunbar’s studies of natural conversations reveal that, for both sexes, around 70 per cent of all conversation time is taken up with matters directly related to personal experiences and social relationships. ‘Work, philosophy, politics, culture, instructions, ethics, religion, even sport - all these are crammed into the remaining 30 per cent. Even highbrow newspapers devote up to half their column inches to what they loosely describe as "human interest" stories and features’.

In internet terms online shopping, news consumption, finding out what and where to shop, book holidays, download music, trade on eBay as well as computer and mobile information access  can be attributed to what Dunbar might ascribed to ‘Work, philosophy, politics, culture, instructions, ethics, religion, and even sport’ and be of the 30% ‘online work’ element of human lives.

What of the remaining 70%?

The rise and rise of social media can well be a symptom of people in Europe using time ‘directly related to personal experiences and social relationships’.

There is considerable evidence to provide a view of the time people in the UK spend online. Research by uSwitch.com, a price comparison and switching service in 2009 showed internet use extending to 30 hours per week (Hooked Online 2009).  The 2009 findings showed that at work the average person spent  5 hours online - 2 hours for professional  or work  purposes and  3 hours  for  pleasure and leisure. In addition a further 2.7 hours is spent during weekends or a ratio of 2:4.7 between ‘work, philosophy, politics, culture, instructions, ethics, religion, and even sport’ and related to ‘personal experiences and social relationships’.  Such an assumption would suggest that 56.53%. of time spent  online is devoted to personal experiences and social relationships. As Dunbar notes, such time consuming activities are in the nature of humankind. They are driven by our DNA.

The value of social activity online

From such data, it is not unreasonable to identify that a very high proportion of online time is spent in social activities unrelated to the need to work (or be a modern hunter gatherer).  Perhaps not 70% but, even without the internet delivered interactions like mobile phone calls, or sharing pulse rate data at the gym with sporting buddies, not unrealistically, fifty per cent.

From such evidence one might ascribe 30% of activity of online users is in the realm of day to day e-commerce and other modern survival needs and perhaps 50% is spent in building and sustaining relationships in one form or another online.

If the former, based on the  Boston Consulting Group findings, is worth € 750 billion, then a measure of European online social activity might be valued at € 1250 billion. This will lead us to a conclusion that online social interaction is a € 1 trillion  activity every year and growing at a rate of perhaps 10% per year!

Such analysis is not provided as perfect data or the actuality but is offered as an indicative indicator of the relevance and importance of online relationship activity.

It is not that being social online has come out of the blue.

In A Cooperative Species, Samuel Bowles and Herbert Gintis (Bowles & Gintis 2011) show that the central issue is not why selfish people act generously, but instead how genetic and cultural evolution has produced the human species in which substantial numbers make sacrifices to uphold ethical norms and to help even total strangers.

Is it that we have evolved to share information.?

Are embedded hyperlinks and Bitly.com an evolutionary necessity? Do they satisfy a need buried in our DNA? Is this why humans are attracted to forums, blogs and social networks where there is room “make sacrifices to uphold ethical norms and to help even total strangers”. Are such activities no more than technically enhanced evolution of being a human?

In his Saturday Essay in Wall Street Journal in May 2010, Mat Ridley (Ridley 2010) encapsulated the whole process rather well. He wrote:

“Trade is to culture as sex is to biology.”

 “The rate of cultural and economic progress depends on the rate at which ideas are having sex”.

There is a lot more in this research, but suffice to say that the value of online activity from both social and evolutionary perspectives is driven, it seems, by deep needs buried in humanity’s genetic makeup.

Within Europeans online is a deeper need to interact and combined with e-commerce this exceeds a nominal value of 2.250 trillion euros!

Public relations and internet activity

Public relations, and that growing element of public relations dealing with online work has a role to play in facilitation of online interactions associated with organisations.

It has a role in satisfying these deep needs buried in humanity’s genetic makeup.

On the one hand we have the practice of public relations at work engaged in facilitating management practice,  governance, organisational values, marketing communication, applied ethics, and religion.

On the other hand we have pure play public relations engaged in relationship facilitation.

These then  are the two sides of the PR coin, evidenced online, exposing our very humanity, the nature of our species.

Granted that the measures identified here are crude; granted that this approach uses the currency metaphor which many will find hard to come to terms with. It shows a need for more detailed research but, for the purposes of this essay, it suffices to say, that online social activity across Europe can be estimated even in financial terms that run to hundreds of billions of €s.

Using the financial metaphor also allows us to get some idea of the public relations opportunity for contribution to these astonishingly high numbers.

Equally, such an approach opens up a much wider, largely unexplored and exciting realm for research and PR practice.

What is the new realm of online public relations?

Now that we have some form of measure for online activity, we can examine what role might be assumed by the online practitioner.

There may be a role for the practitioner looking inside and organisation to aid in identifying the organisation’s view of its corporate, product and service ‘brands’.

The online practitioners may want to take a different view from the traditional marketer who might regards a brands as ‘a name, term, sign, symbol, or design or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them those competitors’ (Kotler 1991 pp 442).  

In online public relations, there would be a view that the convergence of brand values and constituent values are more significant. We have already seen evidence of this from the extensive empirical research by Bruno Amaral (Amaral 2009). Online PR research has already taken us beyond the rather superficial marketers view to the view of a practice based on the nexus of human values as may be relevant from time to time.

There is a role in finding values that can be encapsulated in brand identities. One possibility is in using the  semantic  rule  to  relate  the  compatibilities  between words and values as  a  composite  linguistic  value (Zadeh, 1975). 

These are significant matters. Online they help identify the webpage metatags, keywords for client and competitor search and monitoring, concepts for semantic attribution in on-the-fly evaluation and more detailed strategic and tactical activities. Better than that, they help identify those values that are convergent as between and organisation and its constituencies. For the future Kotler-style brand differentiators will be about values of all descriptions and mediated by a range of constituents because they satisfy the selfless attributes of humans described by Bowles and  Gintis (ibid).

A role for Public Relations describes a view by the client of its values to a range of constituents. It is these values implicit and observable in relationships and in relationship building that describe the tokens (brands) that are the corporate or product /brand identity (Phillips 2005) and, once again, we can see the need for convergent values that emerge as between brand and constituencies.

The marketing communications role for PR is in in supporting organisational activities to manage constituencies’ expectations of the brand. Today, that is, the values constituents'  attach to the brand on  Twitter, Facebook and  Wikipedia. In addition now that much media is reliant on social media for intelligence and background, media relations.

This level of practice is described in current practitioner advisories and books such as the CIPR book ‘Online Public Relations’ (Phillips &Young 2009).

Uniquely, PR has the role of managing the expectations and relationships in which the brand’s values are spread between constituencies and, on occasion, with the client in an environment that is not dominated by mass (or any other single) media. It is described by Clay Shirky as cognitive surplus (Shirky 2010) and is manifest among  the 1 in 10 Europeans who are ‘Multi-Screeners’ – watching TV, using the internet on a PC or laptop and using the internet on a mobile phone or PDA at the same time (European Interactive Advertising Association 2011).

Kline and Boyd (2011) suggest that much human adaptation depends on the gradual accumulation of culturally transmitted knowledge and technology. Recent models of this process predict that large, well-connected populations will have more diverse and complex tool kits than small, isolated populations.

Because the internet offers excellent population connection on a scale humanity has never seen before and with the evolution of cognitive surplus, we have seen the effect on availability of ever more ‘diverse and complex tool kits’.

With the exchange of values between actors across the globe, this layering effect can gain traction very fast.

From Twitter to Skype and leavened by Slideshare and YouTube, we can see these effects in our everyday lives.

Being aware, involved with and sometimes of the values in conversation is not a role for any other discipline other than PR. 

Offering the organisation’s brand values in its offline and online social context is the largest part of successful social and commercial activity. It is the essence of communicative organisation.

What part does public relations play

How much of the € 2 trillion online ‘economy’ should be engaging PR academia?

This year in the UK more computer games were bought and downloaded online than were sold in retail outlets.

More newspaper articles were read on line than in print. 

Electronic Kindle books outsell both hard and paperbacks on Amazon.com

The total online retail sales across Europe is a tiny fraction of European GDP. It was worth £145,600 million (€ 173 billion) in 2010. Online retailers in the UK, Germany and France accounted for 71% of European online sales. In 2011 online sales in Europe are forecast to grow by 18.7% to a new total of £171.8 billion or €202.9 billion (Centre for Retail Research 2010).

There is a case for looking to PR academic community’s involvement in identifying such trends to identify potential opportunities for PR practice.

Knowing that for the 54% of the European population which is online and that more than 10% of their purchasing will be via the internet in the near future would suggest that the part of the PR industry serving the retail sector would be representative in practice and growing faster than its current 10% per year organic growth.

With most of the publically quoted PR companies reporting turnover growth at best of no more than 10% for the last three years, despite many proclamations of digital credentials and online advertising spend up by only 7.6 per cent in 2010  (European Interactive Advertising Association EIAA 2011), it would seem there is a disconnect between growth in online retail activity and its retail marketing communication and advertising and PR partners.

In the UK, France and Germany, it would seem that here is an opportunity that has, so far, been missed and for the rest of Europe it is an opportunity to be grasped.

Such an opportunity suggests forms of online PR practice that are an extension of current practice.

Meantime, there does not seem to be much involvement by the PR industry in the rate of cultural and economic progress that depends on “the rate at which ideas are having sex.”

Evolution is never linear – some indicative examples

There is an assumption that internet evolution will be linear. This would be impossible.  There is far too much evidence of new and evolved forms of communication and transactions made possible by internet technologies.

One example will suffice for many. The Microsoft Xbox Kinect, a computer game, enables the computer to recognise individuals and their movements. In addition it is able to translate such data to provide imagery of interactions between one of more humans and inanimate and animated real and virtual objects. This is a new form of communication. As such it offers practitioners in communication a wider palette of communications methodologies .

In such circumstances one might expect European PR  research to be exploring the opportunities for such technologies in the practice of public relations. Instead, there are schools of practice in universities developing things like internet mobile applications beyond the PR context.

Intel announced its Light Peak product in 2011. It is significantly faster than USB 3.0, carrying data at 10 gigabits per second in both directions simultaneously. Connection speeds will not be affected by the transition to copper. Future, Light Peak may scale to 100 gigabits per second. The ability to run multiple protocols simultaneously over a single cable, enabling the technology to connect devices such as peripherals, displays, disk drives, docking stations, the whole paraphernalia of communication and more is significant.

Embedding the internet into devices is now simpler.  In the Spring of 2011, the protocols will be agreed for embedded SIM technology. It is not meant to replace the removable SIM cards used in today's mobile phones, but used in various consumer electronics devices to connect them to the Internet. It's the another step to building an "Internet of Things."

One simple example of the “internet of things” will suffice to explain the potential. Researchers from UCL (UCL 2011) have developed a digital tool that allows people to attach memories to objects in the form of text, audio or video by simply using a bar code. They see this as a means to provide historical values to objects. In PR, there are many more applications. Attaching news, information brand values, contact information and many other content tokens requires no great leap of imagination. The communicative organisation (see Stockholm Accords ibid) may soon be able to deploy communicative objects to further serve PR practice.

This month Zabaware announced its artificial intelligence technology known as Ultra Hal for Twitter (Zebaware 2011). It comes alongside  Klea Global (the author’s company) which is developing auto learning/teachable software for online monitoring and evaluation. The extent to which teachable (‘thinking’) software will and can be used in development of online social relationships and traditional PR evaluation is out of the lab and in beta testing.


It is already used by online music stores like LastFM to focus the right content to individuals.

These non-linear developments take PR into completely new media and applications many of which are already available.

It is not that such media will not develop without PR. They will. The key here is what kind of academic will spot the opportunities, the communication opportunities for relationship building and potential applications in practice.

If some universities can develop and harness new science and technologies, drugs and treatments for the medical profession, why can they not do the same for Public Relations? The social and economic advantages are just as important.

The value of knowing value

The internet in its many manifestations is, for many, becoming ubiquitous.

Populations are not, nor need to know whether the train timetable on their smart phone is delivered via internet technologies. In the midst of a personal exchange on Skype or Facebook, the internet and its manifestations are not part of the user’s conscious thought processes. The value of such social interactions is singular.

The internet and even social media is now of much less concern to the consumer that the facility it provides. Online PR should not be an expression used by PR people. Online is as significant to PR as ink. It's just there!

On the other hand, a financial view is helpful for PR academia. It offers a dimension, a metaphor for our activities couched in a currency most understand.

Knowing that digital consumer activity is growing at a rate in excess of 10% across Europe alerts the informed commentator that the PR sector has failed to keep up.

The sector may like to put 30% of online activity down to marketing communications and news distribution and the remaining 70% to being able to understand the nature and opportunity for being engaged in personal experiences and social relationships.

For the communicative organisation as outlined by the Global Alliance in the Stockholm Accords (2010) these are significant ideas. The potential to build relations with the whole person is a very exciting prospect.

An easily wasted opportunity, robust research and development would be very helpful in this area. .

Most certainly research funding covering such important elements of economies will be rewarding.

In addition, the extent to which exploration of the €1.250 trillion  internet related personal experiences and social relationships has a much more tangible feel to it when it is compared to the lesser € 750 billion marketing communication and information activities such as work, philosophy, politics, culture, instructions, ethics, religion, and sport!

This allows us to think well beyond the present consideration which comprises academic rationalisation of PR practice to look at new paradigms. It opens up huge challenges.

Social Media and the Challenges to Academia

First of all, a little context.

Of course, internet mediated civilisation is not the be all and end all of all human activity or public relations. But its very pervasive existence affects all PR practice.

Equally, without fundamental research into internet mediate relationships, the PR industry has nothing but a reactive, technically antiquated, narrow and desultory future.

Soon, the PR industry will not be able to sustain a PR practice led academia.  Without internet engagement at a much deeper level PR, as practised today just cannot survive. Is it already the case that there are more PR press agents than employed journalists?

With such a weak PR industry, both theory development and the sustaining in-house and agency careers for students will be found wanting.

As media titles fall or attach to electronic devices beyond electronic paper,  iPlayer and Kindle and as the evolution of internet mediation creates new ways of living, much of current practice just won’t exist.

How common, for example, is the practice of writing letters among practitioners and academics? When last was the first port of call to find a newspaper article the local library?  Who now has to offer a journalist a telephone at a press conference to call in copy? When last did practitioners lick stamps?

Ordinary life is changing very fast.

There remain, even in academia, those who do not consider that the internet mediates their speciality. They may like to ponder that the number of people online in the third most populous nation in Africa, Egypt, has fewer internet users than Europe’s third smallest country, Luxemburg - and yet the internet had a role to play in bringing down the long established regime. A 21% internet penetration of the population (compared to 85% in the UK) was affective.

 I described the first phase challenge of the internet for public relations in 1995 at the IPR annual conference (Phillips, D. 2001) with these words:

The new media will enfranchise the individual with more one-to-one, one-to-many and many-to-many communication which will be easy by personal ‘phones, E-mail and video conferencing.

Person-to-person-to-machine and database communication will be more important, electronically managed and more global. Increasingly this broth threatens brands and corporate reputation and needs professionalism to immunise or doctor the effects of the brew.

In its most perfect form, reputation management sustains relationships with publics in a state of equilibrium during both evolution and in crisis. This enhances corporate goodwill (a tradable asset).

The big change is that many-to-many global communication brings with it loss of ‘ownership’ of language, culture and knowledge and that there is a breakdown in intellectual property rights, copyright and much plagiarism. This is already a major problem.

News now travels further and faster and is mixed with history, fantasy and technology. Reputation in crisis is even more vulnerable. At a growing rate, the new media uses reputation as ‘merchandise’, stripped from the foundations which created it, then traded for pieces of silver - and at a discount.

That phase of internet mediated public relations is past. If universities are not teaching and practitioners are not practicing PR to cater for this, older form of online PR, they will face hard times sooner rather than later. It is time, even late, to move forward.

The internet is now a functioning sub-strata. It is mediating all human endeavour in Europe.  For the consumer internet technology is almost as irrelevant as making your own ink. The internet is all but invisible in delivering a huge range of benefits.

I have given some insight into my best guess as to a value we can place on the present potential for PR in the context of online economic activity of some €750 billion and have assessed an online  relationship ‘economy’ with an annual ‘value’ of  €1.250 trillion. Both such figures are growing at more than 10% per annum which makes them commercially attractive to academia and private practice.

The extent to which the PR industry can service these activities cannot be assessed in terms of existing online PR practice, research or teaching because the industry and academia has been so very slow to respond to the opportunity.

 It is extremely unlikely that current market facing online PR is engaged in even 0.1% of online commercial relationship services. Online PR across Europe is by no means a €750,million a year practice and will not even approach this number any time soon. In the wider (more valuable) social activity of the online relationship ‘economy’ activity has hardly begun.

In the next phase, even basic knowledge is hard to come by from PR academics and there is even less academic interest in finding out what it entails.

The semantic web, the internet of things, and the internet of intelligent software are big challenges.

Even bigger is the area of relationship interactions. They are even more important. They affect the very foundations of democracy and the survival of The Enterprise as we know it. The nexus of contracts (Coase 1937) gives way to the nexus of relationships (Phillips 2006) in order that the organisation can survive and prosper.

Identifying the relevant evolution and its application to relationships between constituencies and organisation is a big task.

 Developing the means by which such research can cascade to the organisations that want or need better online public relations and education of  is another area for potential academic activity.

Finally there is the nature of practice as it is and can be. The steep learning curve for practitioners, engagement of the PR institutions and representative bodies alongside the professional courses is another big opportunity.

Bibliography

Amaral, B & Phillips, D. 2009 A proof of concept for automated discourse analysis in support of identification of relationship building in blogs. http://www.bledcom.com/home/knowledge accessed Feb 2011

Bowles, S. & Gintis, H. (forthcoming 2011) A Cooperative Species: Human Reciprocity and Its Evolution Princeton University Press

Centre for Retail Research 2011 http://www.hallam.biz/wp-content/uploads/2011/02/Online-Retailing-Statistics-Britain-€pe.pdf accessed Feb 2011

Coase, R. H. 1990  “The Nature of The Firm” Economica 4: 386-40

Dunbar, R. 1996 TES http://goo.gl/VvY1w  accessed  Jan 2011).

European Interactive Advertising Association http://www.eiaa.net/news/eiaa-articles-details.asp?id=224&lang=1 accessed Feb 2011

Hooked Online: Brits Spend 30 Hours a Week Online  uSwitch.com http://www.uswitch.com/press-room/press-releases/hooked-on-the-internet-brits-spend-30-hours-a-week-online--1160.pdf accessed Feb 2011

Internet World Stats http://www.internetworldstats.com/stats4.htm  accessed Feb 2011

Kline, Michelle A. and Boyd, Robert 2011 Population size predicts technological complexity in Oceania Downloaded from rspb.royalsocietypublishing.org on 4 Jan 2011

Kotler, Philip H. (1991) Marketing Management: Analytics Planning and Control 8^th ed. Englewoods Cliffs, NJ Prentice Hall Inc.

Phillips, D. 2006 Towards Relationship Management, Journal of Communications Management  Vol 10 No 2 pp 211-226

Phillips, D. 2001 Managing Reputation in Cyberspace, Thorogood available online http://ebooksgo.org/computer/ManagingReputationinCyberspace.pdf

Phillips D & Young P. 2009 Online Public Relations Kogan Page

Ridley, M 2010 Humans: Why they Triumphed  Wall Street Journal http://farrington1600.wikispaces.com/file/view/WhyHumansTriumphed.pdf accessed Jan 2011

Shirky, C. 2010 Cognitive Surplus: Creativity and Generosity in a Connected Age Allen Lane

Stockholm Accords The Value of Public Relations and Communication Management 2010 http://www.wprf2010.se/draft-of-the-stockholm-accords/ accessed Feb 1011

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Zebaware http://www.zabaware.com/ accessed Feb 2011

Stockholm Accords and Sustainability

This is second of a series of lectures notes I am preparing about the Stockholm Accords.

Some months have passed since the World Public Relations Forum discussed and approved the Stockholm Accords. It was the culmination of an intensely participated collaboration process which involved some 1000 leaders of the global public relations community from 42 countries by the PR industry's Global Alliance.

There is a Stockholm Accords digital HUB that you may visit here at: www.stockholmaccords.org. The discussions are worth following and I recommend all practitioners to visit and get engaged.

You can access the Accords here. I have also provided a text version here (for all those people who like to copy 'n paste and not get irritated by the use of PDF)

The Accords offer us a view of sustainability in these words:

An organization’s sustainability is based on balancing today’s demands with the ability to meet future needs, based on economic, environmental and social dimensions*.

In this network society, sustainability leadership offers a transformational opportunity* to enhance the organization’s reputation and demonstrate success across the triple bottom line.

Public Relations professionals identify, involve and engage key stakeholders* contributing to appropriate sustainability policies and programs by:
· interpreting society’s expectations for sound economical, social and environmental investments that show a return to the organization (the advocate)*;
· creating a listening culture – an open system that allows the organization to anticipate, adapt and respond (the listener)*;
· ensuring stakeholder participation to identify what information should be transparently and authentically reported (the reporter)*;
· going beyond today’s priorities to anticipate the needs of tomorrow, engaging stakeholders and management in long-term thinking (the leader).

Reviewing each of these elements in turn, we can extend the debate.

An organization’s sustainability is based on balancing today’s demands with the ability to meet future needs, based on economic, environmental and social dimensions is a bold and, I suggest, a late 20th century view. It will hold good for some time to come but the move towards greater competitive transparency, the evolution of the semantic web and ever more effective 'Blazing Netshine' that allows us all to search and expose the minutia of human endeavour will challenge economic, environmental and social dimensions with added elements.

The nature of value is being challenges in many ways.

What is 'free' (i.e. not paid for with today's monetary currencies) is frequently challenged in today's society. Patents and Trademarks, copyright and personal assets are exposed in near ubiquitous interactive communication and yet many things seemingly 'free' are much valued.

The 'Free' search engine Google has immense value for most people well beyond the irritation (and much ignored) advertisements. Its value as part of a new form of memory and access to knowledge is huge and dwarfs the utility of Library of Congress and all the other libraries in the world combined.

The nature of value is changing so fast, one might begin to consider coinage as being of lesser utility this year compared to last.

We are beginning to understand value differently. We are beginning to understand commonly held values as being the element that aids/is the essential ingredient for relationship creation (paper by Bruno Amaral and me) and meta values commonly held between two or more people as an indication of the strength of relationships.

Indeed, we are now seeing such values attached to ideas and artefacts as a description of their value and utility for individuals and communities.

It follows that basing anything on economic needs may have to face up to a new form and understanding of economics that truly are (in a process of becoming) dimensionally different. Here is a simple example of what I mean. What is the value of Google to humanity in this generation? Google valued by markets at $165bn  gets two trillion site hits per year. It is a lot of knowledge transfer and priceless (if sometimes trivial).

This leads one to imagine the environment for the existence of organisations.

In an era of developing ubiquitous access to knowledge, corporate environments will have difficulty being an entity. The nature of transparency, porosity and agency as described by the PRCA/CIPR Internet Commission a decade ago (and revised by Philip Young and myself in Online Public Relations) mean that organisations become less bound by a corporate 'hard shell'. We already see this in organisation where 'contracting out' and the use of agents such as PR consultants to act on behalf of and in the interests of an organisation is commonplace. As each employee gets a Twitter Account, the evolution of this transparent and even porous nature of organisations becomes ever more, and publicly evident. The changing environment militates against the structure of organisations as we know them today and we see this in a range of manifestations where the boundaries between one organisation and another is blurred.

An organisation’s sustainability based on balancing demands in social dimensions is also a significant challenge. The social constructs for much of society is changing.

The emergence of Brazil, India and China as big and developing (and more open) economies, the ability to communicate across borders at will and the dynamic of  social groups formed in the silicon sitting rooms of Twitter, Facebook and Linkedin are very different social dimensions. Add smart phones and location based micro communities and society looks very different. These are considerations for all who signed up to the Stockholm Accords and have to be thought through by the professional bodies as well as their members.

The professional bodies also have to re-act or be left on the shelf.

The Accords postulate that, in this network society, sustainability leadership offers a transformational opportunity to enhance the organization’s reputation and demonstrate success across the triple bottom line.

Sustainability to be long lasting has to be flexible and enhancing reputation is not limited to economic, ecological and social advantage.

I have already suggested that economical advantage my be difficult to quantify as values take on a different role and are probably better viewed in relationship building terms than monetary value.

Environmental and social advantage may then also be measured in their capability to bring relationship values to the fore. This is not a tautologous argument. Environmental and social values are not the same and current practice needs a lot of new and additional work to achieve 20th century gaols. To be effective in the 21st century, PR has to evolve a triple line that can extend into the much more complicated world of individual, corporate and environment relationships and their value drivers today.


Oddly enough identifying, involving and engaging key stakeholders is very easy. We have not yet developed the technologies sufficiently well but espousing values will quickly build relationship clusters with people holding similar values. In the bast it was a little understood but effective brand empathy matrix. Today, we understand it as a not wholly different, but stakeholder derived values matrix.


As we move towards greater competitive transparency and learn to manage organisational porosity it will become much harder for an organisation to determine what information should be transparently and authentically reported. The stakeholder not only has the whip hand by virtue of a wider view of values porosity will inevitably reveal and the community will punish any organisation that lacks authenticity. Secretive accountants and pharmaceutical companies are going to have to find a values driven accommodation with society to remain as they are.


It is professionalism that develops a capability to go beyond today’s priorities to anticipate the needs of tomorrow and, in addition more emphasis on todays word among PR teachers.

Semantic Public Relations - a future PR discipline or just future PR?

Over the last week, a number of people have asked me to explain what I mean by Semantic Public Relations.

I could spend a lot of time writing a definition of semantics  or the semantic web.  I could show how the inventor of the web Tim Berners-Lee finds it all absorbing, why Google thinks its is essential to its future survival, and how some serious thinkers see how it is important for the future of society.

It's a much more fun to put on a practical demonstration. That is what I am going to do.

The demonstration will seek to show that it is possible to identify as a moment in time the key semantic notions that define a genre and individuals in the genre.

The methodology I shall apply is listed in this post but I shall also provide the practitioner with the tools that allow practitioners and researchers to replicate  the findings.

To ensure that this is a relevant case study, I shall take an example of major competitive public relations campaigns, the UK General Election. Specifically I shall look at the semantic similarities and differences of the three leaders: David Cameron, Conservative; Gordon Brown, Labour and Nick Clegg, LibDem.

This is a big project and we are limited (by the technological challenge I face) to sampling the corpus. In the future we do not have to be limited by such constraints.

The methodology I am able to use is as follows.

• Every 40 minutes I shall use and automated bot to interrogate the internet to identify new web pages published in a day which mention each of the three major party leaders. I anticipate this will be of the order of 200,000/300,000 every day (or more). Of these I will select 1000 pages (citations) on the basis of number of views and mentions of the leaders in headlines and first paragraph. This content will include publicly available items of:  news media pages in online newspapers, magazines and other news outlets (offering news that is not hidden behind robot blocks and paywalls); blog posts, Twitter tweets, Social Network contributions, wiki pages, Bulletin Boards, discussion lists, List Serve, Sidewikis, comments about photographs and videos, slideshows and other web based pages.
• Each of these selected citations will be parsed (software available here) to extract the the contiguous text which will be retained for further analysis together with an audit trail giving date found and URL.
• Each citation will then be parsed using latent semantic indexing software which will identify the semantic concepts in each citation (here is software that you can use to extract concepts from web pages).
• I will then rank the concepts in order of frequency of use in the citations for each day. This will provide a rather boring list of words and their daily count.
• To make it easy to see the result and to compare the three Party Leaders, I will use a wordwall for visualisation purposes so that you can compare the most significant semantic concepts for each of the three selected leaders.
• These will be posted on this blog every day until polling day.

What do we anticipate this is going to show?

1. This is a proof of concept demonstration showing the semantic differences between the three competitors. 
2. This will show how using a sample of online content selected for its reach and readership the web reports the three campaigns.
3. The analysis will show how these citations represent an online view of the competitors' similarities and differences.
4. It shows how all manner of online influences can represent the three candidates.

As the evidence appears day by day, it will be interested if there is any advice that a PR professional would propose to a candidate based on what the online community is 'thinking'.

Of course some of the PR response will be based on the relationships at play; values that attach to the candidates and the extent to which these responses are driven by people who are motivated to do thinks (like post comments or vote?) and other factors.

Then, we have Semantic Public Relations.

I suspect that what I will be showing in this demonstration is that the online community is driving the agenda and what I think we will find is that the competitors are ignoring a large part of that agenda.

I suspect that the PR response that I hope you will provide will be in near real time and will interpret the results as part of a process in working out what future, internet mediated, ubiquitous interactive communication will look like for effective PR practice.

Enjoy.

It should be remembered that the methodology has not been fully tested (mostly so that it can be available quickly for the CIPR SM committee to see how the internet is moving on and in support of Philip Sheldrake's work). If this was to be a research project to provide a research base for PR practice, it would be conducted differently But this is a nice demo (and, of course, I am very happy to help anyone who wants to do this work for the PR sector).

A New Look at PR Decision Making

White and Dozier (Excellence in public relations and communications management 1992 Lawrence Erlbaum - Ed James E Grunig) provide a view of management decision making in the context of a pre internet time.

They quote L D Phillips (1982) Requisite decision modelling: A case study. Journal of Operational Reserach Society,

'When abstract decision problems are detected, decision makers must resort to their imaginations to construct scenarios so that decision making can proceed. Such scenarios are not precisely defined. At best, they are simplified models of possible futures that help focus attention on crucial variables and decision points. Such scenarios are requisite when they provide a sufficient basis for solving particular problems through an appropriate decision. Requisite scenarios are social constructions; they are fashioned through communication among decison makers and are developed in an iterative manner.'

This process (often used inside a structured form of risk management) like most Applied Information Economics is akin to the academic practice of testing hypothetical questions and which, explored in Phillips & Young (2009) as PR risk management, is part of public relations in both the Excellence and the Relationship Values models.

There is now a need for a new and closer look as the internet forces understanding of transparency, porosity and agency (as well as richness and reach) on all practitioners.

The post web era emphasises the nature of the organisation as the nexus of relationships (and as this sequence of posts shows, changes the nature of the firm) and asks us to re-think many past practices. PR becomes much more of a (post modern?) management practice. In such an environment the practice will be at the point when there is a formation of tokens and values that will attract actors into a nexus of relationships to be, or to challenge, the 'dominant coalition'.

In the excelence model there is a requirement for dissonance in the form of an issue for an organisation to be a public and thereby exist. Issues might come in the shape of the extent of the need for profitability, growth and size, sales etc. These are second order activities but necessary in a a case where tangible assets are the drivers of corporate management.

Based on the nature of the firm (Coarse) being moderated by contracts (a form of issues mitigation) this is fine. It is no longer adequate.

In the Relationship Values model there may, indeed, be dissonance and or issues tokens but there is the potential for other constructs for relationships to be formed through a common and mutual understanding of values expressed as tokens. The process is to seek relationships through better understanding and adaptation of values in order to create relationships and which is both a mutual activity and far from an issue, a form of self actualisation.

The firm, now evidently being the nexus of relationships, can now be much more flexible in response to problem resolution. Furthermore, the formation of groups based on common understanding of tokens extends beyond both the old construct of a nexus of contracts to a nexus of relationships.

All of this comes from work that is now five years old and in less than a year developed quite well.

It is very hard to imagine most advanced online public relations without the relationship model at its core. But this is a much more cerebral form of public relations management than most 20th century practice.

Developing Post Digital PR Practice

Many people tell us how the new online paradigm offers data and transparency which can be used in PR.

What most don't tell us is that this is fine for some media (on and off line) for other media its not quite as comprehensive as it might seem. A lot of the measures are not as transparent as they might be and the opportunity for measuring apples as oranges are even worse that AVE's.

As a Klea Global director I have been looking at how existing technologies can help and how measures can be developed that are both communication platform and channel agnostic.

This is work in progress and I some of the processes proposed are still in development but will be available (if not common) by the end of the year.

Of course, there is a lot to add but it is a beginning for the student and practitioner.

What most will find amazing is the modern capability to collect all new media citation in fractions of a second and in only a few fractions of a second more, to be able to fit this content into the overall pattern of an organisation's presence.

There are a number problems that still exist. Semiotics covers text, images and video as well as Augmented Reality added content etc and so we have some way to go.

The key, as always, is to have drill down transparency, comprehensive and timely motoring, evaluation and insights.

Pictures and video is much less amenable to semantic analysis at present which will be really powerful when it arrives. However, we can see how powerful semantics can be with the results that are evident using the 'Reputation Wall' and other semantic analysis of content.

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I will be delighted to see how far this form of PR goes.

Situational Theory and the Relationships Values schools of thought

Bruno Amaral has responded to Professor James E Grunig's critical review of Philip and my book Online Public Relations. His treaties entitled Paradigms of global public relations in an age of digitalisation provoked an extensive response from Philip Young as well. Once again, Professor Grunig has responded. It is a wonderful response.

I have responded on Bruno's blog and this is by way of a slightly extended cross post of my approach.

I guess it is appropriate to disclose the earlier work which I posted to this website some years ago. This provides a much wider view of the relationships model for public relations and was the basis for the paper 'Towards Relationship Management' (also published in JCM) which is the published manifestation of some years of thought.

The present interest in the Relationship Value model is interesting and I am grateful to Bruno, Philip and to Professor Grunig for pursuing the differences between the Situational Theory and the Relationships Values schools of thought.

We seek to identify the situation of organisations in the natural discourse of its constituency and how such discourse affects and changes the organisation'. If we can do this, it is possible to observe, from one perspective, the nature and drivers of relationships. It goes without saying that I explicated that relationships are a core value for organisations some years ago. In addition, with effective tools and grounded as well as comprehensive procedures, we will be able to present to the public relations industry the Relationship Values hypothesis. It is developments in these techniques that has drawn me to a methodology to provide a proof.

What I found interesting when Girish Lakshminarayana presented his latest Latent Semantic Analysis tools was the extent to which one can identify, develop and explore a huge corpus in a very short space of time.

This capability provides excellent opportunities to explore the hypothesis in considerable depth and, with Bruno this year we moved towards a proof of concept for the methodology.

Bruno showed at Bled last July how useful semantic analysis is for this kind of work in his proof of concept paper.

This has led to a form client content analysis research which I aim to develop in answer to Professor Gunig's paper Paradigms of global public relations in an age of digitalisation and which has a number of steps:

• Identify the semantic concepts in the client website
• Identify the semantic concepts of the web pages of third parties who link into the client web sites (I call this the client sphere of influence).
• Identify the the semantic concepts or the web sites of third parties who link into the client web sites
• Explore all web pages indexed by search engines for the last year that mention the client and extract the semantic concepts.
• Explore all web sites where pages have been indexed by search engines for the last year that mention the client and extract the semantic concepts.

This process can be done in time series which allows one to see concepts emerging, gaining in significance morphing and even declining. A simple example (and useful conceptual model and helpful to test the methodology) of the outcome can be seen using the Klea Global Labs Reputation Wall.

In my paper Towards Relationship Management, I expressed a view that relationships are formed through shared understanding of values. In the next part of developing the Relationship Values theory I propose that the semantic concepts extracted by the software can be viewed as discursive expressions of the actor’s values and we can follow them as they emerge, are adopted by internet users, and gather to them a wider group of online actors.

What we are able to see from this form of analysis is an agnostic, semantic, content analysis of the corporate view of the client by the client (evident in its web site). In addition we have the emerging and changing view of the client sphere of influence and can view this in the context of the wider interests of these external (sphere of influence) actors.

Adding the wider, search, sphere creates a view of the wider context in which the client is of interest.
This is an astonishing amount of data.
The results so far have been most interesting.
I am not, at this stage, sure as to whether the Relationship Values proposition will identify the extent to which values based relationships are also issues. This research process is much more granular and is based on two assumptions.

The first is that semantic concepts are the same as relationship values and that the internet is sufficiently pervasive to be representative of other forms of human discourse.

No doubt that in due course, and to answer Professor Grunig's concern, it will be important to find out the extent to which values and ideologies relate to problems and expectations and the extent to which in analysis of semantics in discourse the Situational Theory of Publics emerges as one of the drivers in the formation of an affective nexus of relationships. The extent to which the nexus of relationships based on values are publics will then be evident.

This is very exciting for the PR industry. If we can find out how relationships are formed and change we can seek ways in which organisations can, more effectively, create and manage the very foundations of their wealth.

The Real Time Web

‘You can't ignore the real-time Web’ claimed Gartner Analyst James Lundy in his keynote address to the Collaborate 2.0 Summit in October 2009.

The web has always been close to real time. That was its attraction from the start. Digital was more flexible and faster to process than analogue communication. But for non geeks the Real Time Web has become fashionable. It's fashionable because of the phenomenal rise of Twitter. Twitter, now over three years old, showed everyone how fast information was spread across the web by social networks. Closely behind Twitter is Google’s Wave, a service for instant key-stroke-by-key-stroke communication and interaction.

Lundy points out that companies, particularly publicly traded and regulated ones, are concerned about real time services for one simple reason -- compliance, a requirement that companies keep track of communications related to company business.

But companies can't ignore the popularity of these services or their inevitable use, said Lundy. He recalled, for example, being in meeting with a Wall Street client who said instant messaging wasn't allowed at their firm.

"The minute those managers leave, we asked the other people in the room and they said, 'Absolutely, we still do it,' referring to instant messaging."

Brian Morrissey reported on Diet Coke’s initiatives in Real Time Web in AdWeek last November noting that

“Marketers including Burger King and Adidas are warming up to real-time Web content, mirroring a shift in digital media away from asynchronous communication and content delivery (e.g., the sending of e-mails and watching posted videos) towards instant feedback and interaction. Upping the ante for these marketers are real-time systems like Twitter and Facebook, which mix content delivery with communication, making something hours' old seem stale.

People, and notably companies, found they needed to be better informed and they needed to watch for mentions online and, urgently, Twitter as well as blogs and other social media.

But what do we mean by Real Time Web? Daniel Tenner described it well in his blog post:

“Real-time web” can mean any number of things, from “live updates without refreshing the page” to “see text as it’s typed”, but all those are technological rather than conceptual definition. At its core, the concept of “real-time web” must be about the immediacy of information flow. Something happens (whether it’s someone typing a message to you or Michael Jackson dying) and you find out about it immediately (or nearly so).

Monitoring the internet and specific content on the internet is not new. Organisation that offer such services include news monitoring by Google (Google Alerts), Technorati, CyberAlert and eWatch There are companies that exclusively focus on online/social media such as Radian6 and Scout Labs. They cover blogs, wikis, Twitter, social networks, bulletin boards and discussion lists. Meanwhile the traditional press clipping agencies such as Factiva, Moreover, Durrants and Cision still keep a wary eye on newspapers and magazines and re-digitise the content for computers to analyse.

Some of these vendors offer regular updates every day, some hourly and some, like Google Alerts in near real time.

There are other services that help organisations such as RSS and Atom feeds that poll web sites at regular (typically hourly) intervals. Then there are the real time services based on a simple, open, server-to-server ‘web-hook-based’ pubsub (publish/subscribe)’ protocol extension to Atom and RSS called the PubSubHubbub protocol that can get near-instant notifications when a topic (feed URL) is updated.

Real Time Web is available using such services. They are time consuming to set up and the client needs to know which sites to monitor in advance. So far only a few small feed readers have begun consuming these feeds; RSSCloud developer Dave Winer's own River2, a complex but customizable desktop feed reader, and LazyFeed, a simple but enjoyable feed-powered discovery engine, have turned on full support for real-time feeds.

Code named Wasabi from Netvibes is a widget service that will go into private beta later this week and will launch to the public at December's Le Web conference in Paris, where the theme of the event is the real-time web.

More contenders in this field are covered in a guest article in Mashable, the Social Media guide by Bernard Moon, who recognises a level of hype about the issue.

So what we find is a host of services covering a wide range of online and offline media.

Very few services are real time. They offer monitoring at intervals and where these services are swift they do not include all the channels out there.

There is one further flaw.

None of these services comprehensively monitors all the content that is publically available online.

There are so many channels for communication online that it is hard to watch them all. Some are, and will remain niche and almost insignificant. Others, though of little consequence in themselves feed the big beasts of the internet.

Much of the content is driven by bots and other automated services and there is still spam galore.

The service provided by Klea Global through its www.nextmention.com service resolves these two big issues. It monitors’ the web for everything and provides ten minute updates free and real time updates in its soon to be announces premium service.

Of course, this is by no means ideal because the many divergent channels from web sites to news to blogs, wikis, Twitter, social networks and all the rest are all jumbled up in the instant feed.

The service is more coherent on the Nextmention site which used a Bayesian bot to sort out the pages into media types and more developments in this direction are anticipated.

There are some other services that are worthy noting and which show how Real Time Web is driving a need for more and faster services. Topsy (http://topsy.com) is a real time search engine that stand out because it focused on real time links as opposed to real time content. So, when you perform a search at Topsy, instead of seeing what people are talking about on the real time web, you are to see what the most popular and prominent links are being shared on the real time web. You can even sort to see the most shared links over the past hour, day, week, or month. Meantime rumours have been swirling all over the web in regards to a partnership Yahoo is discussing with OneRiot. OneRiot (http://oneriot.com/) offers users a real time search engine which can be sorted based on web results and video results.

Meantime, People like Nova Sivack lead us to the problems this content and these services present. He writes in his blog Minding the Planet:

“In the next 10 years, The Stream is going to go through two big phases, focused on two problems, as it evolves:

1. Web Attention Deficit Disorder. The first problem with the real-time Web that is becoming increasingly evident is that it has a bad case of ADD. There is so much information streaming in from so many places at once that it's simply impossible to focus on anything for very long, and a lot of important things are missed in the chaos. The first generation of tools for the Stream are going to need to address this problem.
2. Web Intention Deficit Disorder. The second problem with the real-time Web will emerge after we have made some real headway in solving Web attention deficit disorder. This second problem is about how to get large numbers of people to focus their intention not just their attention. It's not just difficult to get people to notice something, it's even more difficult to get them to do something.”

This is where some of the thinking for the next phase of internet development is going on and how in a very short time one can imagine services that address both these problems with the Real Time Web..

Public Relations - define

For one minute, I would like all those people who do not believe that PR is about relationship management to suspend belief.

For some time I have been thinking about the role of the practitioner in a bank.

It re-defines Public Relations.

I suppose the role of the PR Manager (Public Affairs Chief, Top wogga with some similar title but responsible for PR, CSR, IR, and other acronyms that really mean Public Relations) is now forever changed.

This person really only has one role.

It is to be able to assure the executive, main Board and the regulators (all organisations bend a knee to one or more regulator)that the relationship in any proposed or actual transaction between actors who can affect the long term productivity of the organisation, is robust enough to survive the transaction.

It is really quite simple.

It is probably too rich for CIPR, PRCA and other such organisations.

It will be usurped by Charles Handy and the management guruship.

It is as good for all types of PR from press relations to so called social media relations and sponsorship of the local soccer club.

I just do not know why it has taken me so long to get it!

Productivity comes to marketing

Addressing a meeting of the Public Relations Consultant's Association this morning, Peter Cochrane ducked the question of how the internet changes economics as we know it.

I thought it might be time to re-visit this difficult area of of forward thinking.

Of course, I am not pretending to be able to out-think Yochai Benkler or a host of other experts, authors and thinkers.

I just want to pause for a second to consider productivity.

The concepts of productivity espoused by Hansen & Prescott suggesting that automation is the prefer ed or dominant method for enhanced productivity is misleading. Automation and the deployment of technologies does tend to presage changes in employment and in wealth creation and distribution for a larger majority.

While no one would recommend the slums of London in the time of Dickens, the population was expanding and, horrid though these places were, they had an appeal for the rural population who migrated to them. How hard life must have been in the countryside!

I am not completely in the camp that suggests that mankind is successful because of recent evolution. Evidence suggesting that evolutionary processes in the composition of existing genetic traits may be rather rapid and the time between the Neolithic Revolution and the Industrial Revolution that lasted some 10,000 years is sufficient for significant evolutionary changes. True, changes occurred such as lactose tolerance in Europe and the Near East; genetic immunity to to malaria provided by the sickle cell trait among descendants of agrarian African tribes and so forth but I think that the productivity spark goes back a lot further.

Today's news of evidence that early modern humans living on the coast of the far southern tip of Africa 72,000 years ago employed pyrotechnology – the controlled use of fire – to increase the quality and efficiency of their stone tool manufacturing process tells us a lot more about our species.

Here we see examples of intellectual capital being deployed in the transformation of stone to tool.

This is manufacturing.

It also is an example of knowledge associated with technology in making mankind more efficient.

We are, as Philip and I made clear in 'Online Public Relations' (Kogan Page) extending the capability of our physiology.

Today we can travel much faster than our legs will carry us and instead of a super memory we have Google and Wikipedia. We have used our intellect to create super-humans in the basically primitive human of 70,000 years ago.

More recently, we have added to these capabilities by offering people opportunities to contribute time, creativity and attention to goods and services.

This may only be the adding of photograph to Facebook or an erudite Blog post or even an SMS vote to Big Brother (if it still exists). It might be the development of new process shared with like minds online but its not passively watching television.

This shift from consumer to producer is big and it has a major significance for economics. A huge jump in the productivity of huge population is happening now.

This productivity is lost to most organisations.

Some gain because the productivity is part of a production process or, in marketing it is brand building and its big.

I shall return to this though in a day or so.