McKinsey makes some key points about what companies need to do on the reputation side.

"As a result, responses to reputational issues can be short term, ad hoc, and defensive–a poor combination today given the intensity of public concern. And therein lies a problem that companies must solve quickly: even as reputational challenges boost the importance of good PR, companies will struggle if they rely on PR alone, with little insight into the root causes of or the facts behind their reputational problems."

But Paul Holmes picks up on the unsaid theme – that it’s a management consulting agency, not a PR agency, making these important points:

I wish I could push back more aggressively against this–the idea that public relations is about "spin" rather than "changing business operations and conducting two-way conversations" is particularly offensive–but the reality is that the authors seem to have formed a pretty accurate impression of how most corporate communications departments actually work.  (This is where I would ordinarily go into a rant about the inherent problem with naming public relations departments "corporate communications," which is that public relationships are defined not by communications, but by actions, but you’ve all heard it a hundred times before.)

Finally, he pulls another solid quote that outlines what the most effective PR counselors do (hint, communication is not at the top of the list, understanding audiences and recommending actions is).

The authors’ conclusion: "Companies should emphasize three priorities. First, they need to assemble enough facts–most important, perhaps, a rich understanding of key stakeholders, including consumers–and not only the product preferences but also the political attitudes of consumer groups. Second, companies should focus on the actions that matter most to stakeholders, something that may call for an exaggerated degree of transparency about corporate priorities or operations. Third, they must try to influence stakeholders through techniques that go beyond traditional PR approaches, with an emphasis on two-way dialogue."

We recently conducted a series of polls on LinkedIn to determine how professionals read news.  You can download the full report here.  The key findings showed that while news sites continued to dominate, search engines and aggregators were a major source of news.  On the mobile side, news specific mobile applications (such as the WSJ app on the iPhone) were even more important than a mobile web browser.    Our bottom line finding, based on these polls and third part research such as Hitwise’s list of top news web sites (which found both news sites and search engines in the top ten), is that major news sites along with search engines and aggregators still need to lead the way in distributing information.  Social media then provides a measurement of how well the news was received as well as an amplification effect.  Key findings included the following:

To those public relations professionals that see themselves as lead reputation counselors - do your measurement reports analyze media relations and social media measurement or do they measure reputation?   If the former, then you are a media relations or social media (or both) professional.  if the latter, then you are a reputation counselor.  Do you measure it all?  Then you are probably a well informed senior corporate communications / public relations professional.

I raise this as I regularly hear public relations professionals talk about managing reputation but then have measurement reports that focus on media or social media measurement.   Measuring media has never been a substitute for measuring reputation.  It has always been a good measurement of the effectiveness of the media relations function, but that is but one function in a communications department (even if it is a central one). 

Lately, companies have tried to use social media to measure reputation as social media is heavily driven by user generated content, meaning it has the voice of the audience.  However, only a small segment of the popular is actively engaged in the conversation (see slide 20 of Accenture’s research which includes how many people are not regularly engaged in the social part of social media – click here).  As a result, if you rely on social media measurement to measure public attitude and reputation, you may be getting a skewed portion of the population and one that does not represent broader sentiment (see an example in this AdAge article on the Twitter outcry to a Motrin campaign here).

So what should those who see themselves as reputation managers do?  Look to measure sentiment wi th the broader audience.  Ideally, companies would regularly conduct surveys.  This can be cost prohibitive so, in that client situation, we look at solutions that at least give us a voice of the audience - small virtual focus groups, short surveys, analysis of search engine data and so on.  This does not replace other forms of measurement but we’ve found it is a good start in knowing, directly, what the reputation of a company is with our key audiences.

In discussing public relations counsel, I often hear discussions focus on reputation over understanding the public.   However, some of the best reputations are earned by taking a PR approach that relies first on understanding the public, then by making business decisions around that understanding, and, finally, communicating those decisions and related actions.   An article on M&T Bank Corp in Fortune focuses in on this approach:

In the article, M&T Bank Corp. Chairman and CEO Robert Wilmers is quoted with the following take on public relations:

Bankers should do what he calls "public relations" - not burnishing an image but actually relating to the public and its needs. At M&T, regional banking heads live in their communities (vice chairman Michael Pinto is based in Baltimore, New York Metro head Kevin Pearson in New York City), and their employees get involved in everything from volunteering at a bake sale to schmoozing the local pols. Every area has its own advisory board made up of merchants who weigh in on key loans. President Mark Czarnecki, who started as a bank manager in 1977, says the bank has learned that the closer a customer lives to a retail branch, the better he performs on his loans and the more bank services he is likely to use.

There are a few very notable points about M&T Bank Corp’s approach to public relations:

1. Mr. Wilmers takes the time to understand his business’ audience in order to make the best decisions for his company and customers.  The result is a positive consumer reputation.  One could look at their local approach to management (placing senior executives in the markets they oversee) as a business move driven by both business and PR considerations as management understands that just locating executives near customers drives a reputation that results in more business.
2. Business decisions drive reputations.  This is a redundant point but it needs to be hammered home.  If you read the whole article, you’ll find that the result of a key business decision is, in fact, the desired image (a local bank that understands customers) and reputation (a solid business approach that others should consider emulating).   This is not a bank that makes business decisions then  wonders how to achieve a certain reputation and image. 
3. Research research research.  Understanding an audience takes research.  It can be a in-depth survey or having executives meet and talk to the public/audience (I tend to recommend both but, if only one, do the latter).

There were engineers in almost every country, and way too many product people. We had one product management person for every three engineers,We had a lot of people telling engineers what to do but nobody fucking doing anything. Excuse me. I knew that would slip out one of these times. (click here for the audio)

Her honest approach to communications (talking the way she talks, not the way someone trained her to talk) seems to simply reflect her approach to business – no one doubts her sincerity and seriousness because she’s honest to a f***ing fault about getting things done.  Here’s a good outline of her style at GigaOm.

I’m one of the (few? many?) public relations professionals cheering on this style of communications.  While it’s often not appropriate, it is how people (including executives) talk in the real world and that needs to always be kept in mind.   When an executive doesn’t use their natural language style but instead gets caught up in PR speak (yes, I said it), audiences detect and that affects the trust factor.  People are more likely to believe someone they can relate to and people easily related to people who talk like they do.  

So have I actually told an executive it’s OK to curse?  Actually, yes (ping me as I’d rather not call out that executive…but they took my advice and it f***ing worked).   While executives should stay on message, they should also communicate messages in their natural, honest style.  And if that f***ing means dropping a lot of f***cking f-bombs, then f***cking do it.  You’re more likely to be believed.  And from what I’ve seen, no one doubts that Carol is seriously focused on fixing broken things f***cking fast.

You can find more examples of Bartz’s “real world communications” style at Alley Insider here.  

In a recent earnings call with Wall Street analysts, Mr. Bass was reporting a lousy last quarter for the last year and a murky, at best, outlook globally.  When an analyst, fishing hard for good news, asked what regions were immune to the global slump, Mr. Bass made it clear he would not try to spin bad news into good:

Well, I think Antarctica has been relatively immune, maybe Greenland, as well, although not Iceland, as we all found out.

Enough said.

(note: I first picked up on this in Fred Hickey’s High-Tech Report and you can get the full background from Barron’s).

In government, communications people are policy people; they know the details as thoroughly as those charged with the implementation of the policy…In business, communicators aren’t always business people nor are they close to the strategy of the company.”  He added that many CEOs fail to understand the value of communications. 

In my experience, the public relations counselor with the full grasp of the company’s strategy and technical understanding of its business are also able to relate the strategic value of communications to their CEOs.   PR counselors without this knowledge base are often seen in a tactical function and brought in after the strategy has been set. 

As is the ongoing theme of this blog, the PR skill required to be at the C-level table includes the strongest possible understanding of business in general, an analyst like knowledge of industries, a C-level understanding of a client’s (internal or external) business model and the ability to use this knowledge to help the C-level management manage a company’s reputation.

Paul Boutin has a great example of one of my favorite simple but effective positioning approaches for startup technology companies – take aim at a high profile 800 lbs gorilla and back it up an argument that you can win using strong numbers.

Boutin briefly outlines how Rudder differentiated itself from Quicken Online (and newer but still higher profile Mint) – numbers.

Here’s the email pitch he got from Rudder PR.

While Rudder (www.rudder.com), a new, FREE personal finance tool, might look similar to others at first, this personal finance tool has a very different focus - a big reason why 45% of Rudder’s users are ex-Quicken users and 35% are ex-Mint.com users!

Boutin’s point is that “Rudder touts the wisdom of the crowd, rather than the genius of its founder.”  This is another take on what PR people often advise – get and lead with third party testimony.  But there are more important points here that a startup executive should remember

1. Media love a fight and reporting on potential weaknesses of seemingly undefeatable giants.  In this case, how this small startup might post a threat to Quicken.  Remember, a news story is a story complete with a protagonist and antagonist.
2. While they love it, they hear it all the time (“we’re better than Microsoft because…”).  What’s interesting is to hear how a company is already starting to beat the big guy with numbers to back it up.
3. Numbers (real, not made up) serve as both a story and proof of something.  In other words, numbers are news – not features, strategies or individual customer wins.

On of my favorite examples was our Musiwave work back in 2004.  Musiwave, a startup (eventually aquired first by OpenWave then Microsoft) that delivered mobile music.  We worked with them before over the air music was a topic of industry conversation.  So we took aim at Apple’s iPod and outlined why our over the air model would put the iPod in a position of potential extinction with numbers to back it up – we could show adoption rates in Europe where the role out started.  In addition, we also have an economic model to show how over the air music would make far more money for the wireless and music industries than the iPod.    The trade and business media loved it and used Musiwave as a prime example of changes to come (Barron’s even questioned if the iPod is toast and with a picture of it in a toaster).  Obviously, we were on the mark as Apple is now offering over the air music through the iPhone (if the iPod isn’t toast, it certainly seems to be playing second fiddle).  Here’s a case study on our work with Musiwave.

liking to physically own something (rather than an “abstract” mp3 file), having a physical collection that included the artwork, and being easier to port the music to other areas. For the majority, is there anything as simple as just grabbing a CD from the living room and taking it with you into the car? The industry has always had a tendency to over-estimate people’s technological familiarity and competency.

Of course, CDs are a different media from newspapers, but the themes of physicality, practicality, familiarity, and convenience for the masses are consistent themes. Digital can’t replace the traditional walk to get the morning papers, reading the Sunday papers in bed, or an impulse purchase of a newspaper for a train journey - not everyone has the desire or the access to a portable electronic device at every moment of the day.

Whether it’s habit, touch and feel, familiarity, techno-illiteracy or convenience, a significant chunk of the population will still require a physical version to hold in their hands.

There are a few other key points that I’d like to add to this argument.

1. Don’t look to college and immediate post-college demographics for the future of news reading habits.  I, and many of my contemporaries, didn’t get into regular print reading habits until at least a year or two after college if not longer. 
2. This is not to say there is not a radical change happening.  There is definitely a shift in the media ecosystem resulting in people no longer needing or wanting to rely new newspapers and moving online instead.   But the points made by Nielsen show how paper could survive with a part of the media pie focused on sitting an enjoying the print experience (I certainly do at least on weekends during my morning coffee and paper routine).
3. Online news tends to be more about focused discovery (you have some idea of what you are looking for).  Reading a print paper is often about scanning the whole paper both for the news you wanted as well as to discover an article you didn’t know you wanted.  Personally, I only find that type of discovery to be practical on large, easily flip able-, pages of newspaper (and magazines).

Of course, there’s the question of ereaders like the Kindle.  But the question may not turn out to be based on will people migrate to today’s ereaders, but can tomorrow’s electronic paper replicate the experience of flipping through the morning paper with a cup of coffee. 

Like print books, radio and broadcast television, print newspapers may lose some of their dominance, but will likely find a place a constantly evolving media ecosystem – one that tends not to kill off old mediums, but simply assign them more specific jobs.  At one point, families sat around and listened to the radio in the house.  Now, radio is often best known, and still has a strong place in the media ecosystem, for individuals listening in their cars.  So don’t count print newspapers out yet but do look at how their use and value, much like radio, change.

No social media decision should be led with tool selection. Companies need to first consider their corporate objectives, then determine where their customers, partners and competitors are, and also consider how such use of tools ties to the corporate culture

This was based on the results of companies taking a survey on their agency’s performance.  The quote was, in part, the result of companies not seeing their agencies as looking at the broader universe of media to make sure they were targeting the right places for he audience (and not just what is hot…like Twitter).

Agencies should be focused on working with a company to determine what their desired reputation is, determine the business actions that need to be taken to deserve that reputation, and then effectively communicate both the strategic reputation goals of the company  and the business actions that back up those goals.   Only in the last part should social media tools be considered (and used if research says its the right way to go.

But maybe the agencies are doing the right job.  The ZDNet writer has now posted a survey for agencies.  I took it and am looking forward to seeing the results.  You can find it at http://blogs.zdnet.com/feeds/?p=605.