Recent Public Relations Research Sets Up Conflict Between PR Professionals And The Old School Bottom Line

The Paine of Measurement

The Old Bottom Line Collides with the New Public Relations
New public relations research -- old corporate mindset.

Rumor has it that there is an ancient Chinese curse: May you live in interesting times.* If "interesting" can be translated as "full of conflict," then there is no doubt that modern Western business is now feeling the full effect of this curse. PR people in board rooms all over are headed for a confrontation that makes recent skirmishes between presidential candidates look like scuffles in the proverbial sandbox.

For years, the vast majority of organizations have been driven by a single bottom line, profit. This was relatively easy to calculate. You added up what it cost to make something, plus a bit extra for administration and overhead, then subtracted that from what you charged the customer and you had your bottom line.

But life in the 21st Century is anything but simple. Recent research has demonstrated that the old bottom line is not the whole story. First we found out that the way to make bigger profits is to have more loyal employees, and that we have to do good deeds to gain employee loyalty. Then we found out that good communications is a leading indicator of an organization's financial performance.

And now, most recently, Brad Rawlins has demonstrated that in order to best win the trust of our employees, we have to open our kimono to the world and be completely transparent. (See the article in this issue, and my blog post.)

So here's the conflict: Today's diligent and capable PR person walks into the board room urging better communications, more transparency and open, honest conversations with stakeholders. But the room is full of Machiavellian power brokers who believe in secrecy, stonewalling and the single bottom line. This old-fashioned corporate mindset still insists that the only reason to do something is because it makes money or gains a competitive advantage.

We now know that such an approach is outdated, and those who are stuck on it will soon find their businesses as dead as the dinosaurs they resemble.

The reality is that good communications does make money, it just doesn't do it quite as simply and directly as the old bottom line arithmetic implies. Openness and transparency translate into money saved in legal bills, into efficiency gains because information is more readily available, into lower turnover rates and higher customer loyalty. If trust has a value, transparency is its currency in today's marketplace.

Wishing you large measures of success,

* It is supposedly the first of three curses, each escalating in severity. The other two are: May you come to the attention of those in authority, and, May you find what you are looking for.

Isn't it wonderfully paradoxical that those curses are so similar to the job descriptions of most American PR people, and to the results they typically strive for: crisis control, the attention of those above you, and news? And these curses, mind you, are part of the social heritage of the largest, fastest growing and probably soon-to-be-most-powerful society on earth.