Wednesday, September 30, 2015
Everyone knew the shale oil boom would last for years. "Consider the price of oil," they said. "It won't drop below $50 a barrel even with the extensive drilling in North Dakota." That was then. Now, North Dakota has thousands of dwellings under construction with no one to put into them. Man-camps have disbanded. Thousands have left the state with the price of oil in the gutter. The bust defied conventional wisdom and the "known." Boom and bust has a long history in American economics. It most frequently happened with gold mining. One would think that given the past, the present day investor would be smarter. But no, each time everyone thinks this boom is different. What goes up, stays up. PR practitioners should know better because they see fads rise and fall in the media daily, but they are not immune. They reflect the "known" in their publicity and rarely question whether it makes sense. After all, everybody believes a certain way. Why buck the trend? So, they don't, and the outcome is that they too fall when the bust comes. We ought to know better.
Tuesday, September 29, 2015
This could be a PR disaster when it starts on Oct. 1. Forcing doctors to use 140,000 codes to describe an illness or injury is far too much specificity. It will be difficult enough for a specialist to master the codes in his area. What about internists on the front line of medicine who see a bit of everything? There is such a thing as too much data, and this is it. The propagators of the code understand the enormity of the challenge and have tried to train doctors for its arrival, but the real problem will come when stressed doctors, behind in appointments day after day, try to choose a code on the fly. Expect approximate results and not accurate ones. The real worth of the coding system will be known in a year or two when analysts crunch the numbers and look into their validity. Expect chaos.
Monday, September 28, 2015
One way for a politician to avoid responsibility for his acts is to blame the media for reporting on them. This is what Bill Clinton has done on behalf of his wife. However, the problem remains that she did use a private e-mail server rather than the State department system. No matter, it is easier to focus on media reporting and to say that it was "no big deal" that Hillary erred. This type of counterattack usually doesn't gain a politician much ground nor does it wave off media attention. Rather, it stimulates reporting. There have been several "smoking guns" brought to light but no official movement on the part of the Justice Department. The longer this issue remains in the media, the worse it gets for Hillary, her husband's defense notwithstanding. It is better not to blame the media and to take criticism in silence.
Friday, September 25, 2015
It happens in politics, in business and elsewhere -- the internal revolt. Dissidents rise in protest over an organization's actions and sometimes go public directly, such as Edward Snowden or indirectly through whispering to the media. There isn't much one can do from a public relations perspective. It is up to the CEO or organizational leader to confront the dissident and resolve the issue or to remove the dissident through changing his job or firing him. PR can only relate the actions taken and the reasons for them. The hard part is when an internal revolt is played out in the media. Frequently, journalists will take the side of the dissident, and there isn't much an organization can do to balance the picture. One weathers the storm the best one can while continuing to put accurate messages out to the public.
Thursday, September 24, 2015
Hillary Clinton violated a norm of public relations and is suffering a self-inflicted wound that isn't getting better. Yes, it is about her State Department e-mails and use of a private server. New information keeps dribbling out to reignite the story and damage her reputation. Her favorability numbers have tanked and the door is open for Vice President Joe Biden should he decide to run. Clinton's strategy appears to be deny, deny, deny then concede on a point to stay alive. She can't or won't let the entire story come to light, which raises suspicions of what she was doing with that unprotected server outside the State Department network. As the article states, PR 101 is to get all bad news out at once and be done with it. Why Clinton hasn't done that is a mystery. She knows it is affecting her campaign. Perhaps, events have taken a life of their own, and there is nothing she can do to stop it. If she had disclosed sooner, that might not have happened. Who knows what will unfold now?
Wednesday, September 23, 2015
This article shows why it is hard to pigeonhole the pope along American political lines. He doesn't fit neatly into the categories of liberal or conservative. He is his own man, an independent thinker and believer. The effort to pigeonhole him demonstrates the human tendency to put things into boxes in order to deal with them more easily. It is something PR practitioners know intimately. We call it perception, the lens through which the world is viewed. We try to change perception constantly on behalf of clients through widening or narrowing the lens, or, if need be, changing it altogether. We understand the power of perception and how it distorts or amplifies. We know that reputation is based upon perception, that how one is viewed is how one is considered. Fortunately, the pope has good press, but that can change any day and at any hour, and he understands that. He is not here on the strength of his press clippings. His purpose is higher and he hopes to be perceived through a lens of spirituality.
Tuesday, September 22, 2015
The story out of Volkswagen is so strange that it is nearly unbelievable. That a car company would have the audacity to fudge tests on its engines and then sell tens of thousands of them before the EPA caught on is putting a loaded gun to the head and pulling the trigger. Didn't anyone in the engineering department, the marketing department or at headquarters stop to consider the reputational damage to the company from this chicanery? Volkswagen, which has trumpeted the clean diesel, now has to admit that they aren't so pollutant-free after all. The fallout from this debacle is already being felt. Volkswagen has stopped sales of cars with the engines in the US,whether new or used. Fines from the EPA are bound to be stiff and the CEO of Volkswagen may be looking at the end of his job. Even if he didn't know, he should have known and stepped in before the blunder was released to the marketplace. This is a classic, "What were they thinking?"
Monday, September 21, 2015
Ever wonder how NASA and its affiliates generate publicity for their missions? They work hard at it. The link is to an article that details the Pluto flyby mission, which went off so successfully this past July. It turned out to be a multi-day media event that required plenty of logistics, press access to the scientists, conferences, individual interviews and accommodations for more than a thousand guests and staff. This might be "old-hat" for NASA but for the Applied Physics Laboratory at Johns Hopkins it was new and strange since APL is a closed facility handling sensitive government projects along with the Pluto mission. The brunt of the success depended on photos taking four hours to reach earth. Until those images popped onto the screen and in Instagram, no one could know for sure that the satellite had done its job. Talk about nerve-racking. Years of scientific work and months of publicity planning hung in the balance. As we now know, APL and NASA performed magnificently.
Friday, September 18, 2015
The global financial community has been involved in a guessing game. The sport? When the Federal Reserve will raise interest rates from the near-zero level where they are today. Yesterday was the latest iteration of the game and once again, the Fed blinked and left rates alone. This means the sport will last months longer and markets will once again be primed to react. At some point, the Fed will have a credibility issue, especially when global turmoil has eased and inflation picked up. One can assume the Fed will react quickly when that happens, but there is no certainty it will do so. The conundrum for the agency is that it is in largely uncharted territory. Economists have used the Depression of the 1930s as the analogue, but the two situations are not alike, especially in the level of unemployment. The economy is sluggish and has been for years. It is closer to Japan which has been in and out of recession for 25 years. The Fed must be asking if low growth is a new normal for the country, and if so, how should it react other than what it is doing. It is a global public relations issue.
Thursday, September 17, 2015
More than sparking sales, McDonald's needs to rebuild its relationship with its franchisees. They are hurting and as a result, their view of corporate is negative. McDonald's can't afford to go to war with its franchisees. What it needs to do is to listen to them closely then decide what to do to regain growth. This is a giant internal PR task for the company. There is no easy way to get it done. Inevitably franchisees' interests will conflict. Some will want to maintain the menu. Others will ask for it to be reduced to speed service. Some will ask to modify the franchisee contract. Others will be happy with the way it stands. The corporation will need to thread through the opinions and to find an approach that is both pro-growth and satisfying to its franchisees. It will be a monumental task, but if McDonald's is to start growing again, it needs to be done.
Wednesday, September 16, 2015
Google Books started out as a generous and innovative idea. Google wanted to scan all of the books in the world and make them available online. Then, it ran afoul of authors and publishers who didn't want their works made available free when there was still a chance of remuneration. Since then, Google Books has gone silent. It is sad that such a major project has run afoul. Maybe Google will take it up again when the legal challenges are settled. In the meantime, it is a lesson that even the best intentions can be thwarted and positive public relations turn against one. The problem with Google's idea is the sheer size of the project. People don't trust such a task to be just from the goodness of the heart of a major corporation. It seems the larger a corporation gets, the greater its vulnerability -- or, at least that is the case here. One wonders what more the company can do in order for it to resume its project.
Tuesday, September 15, 2015
As this article points out, the cost of healing or delaying fatal symptoms in healthcare is hard to determine and fraught with cost-benefit calculations. If the only regimen is a high-priced medicine for a particular condition, health care providers have to hold their breath and pay. They can scream later to the government that it is not right to hold patients and health care funders hostage to the cost. Drug companies seem to be following the path of charging whatever the market will bear, given that the market is captive to their pills. Their reasoning has long been that it is expensive to develop a new drug. Researchers go down tens of thousands of blind allies until they find a molecule that is effective and safe. Critics counter that the drug discovery process is inefficient and unnecessarily expensive. From a PR perspective, it looks like drug companies are gouging patients, and they need to do a better job of explaining why a drug costs so much. If there were more transparency in pricing, that might help, but the key in the end is lower cost and until pharmaceutical manufacturers can achieve that, they will be targets for abuse.
Monday, September 14, 2015
Collegiate rankings are a much fought-over area of education, and as the White House discovered, it is best not to do them. The reasons are clear. Using a single measurement ignores multiple outcomes. It is poor PR to proclaim rankings on the basis of one or even two measurements. The publicity factor is high, of course, as winning schools trumpet their positions and losing schools argue with the methodology. Publicity is not what rankings should be about. Rather they should measure real aspects of education and their outcomes. That is difficult to do no matter the yardsticks one uses.
Friday, September 11, 2015
News has come out of a flaw in General Motors' OnStar GPS and communications system for vehicles. It turns out that five years ago, university researchers demonstrated a software hack of OnStar that would allow someone to take over control of a car except for steering. GM did nothing about it until this year. Apparently, the auto giant felt the vulnerability wasn't a priority until other hackers demonstrated they could take over a Jeep a few months ago. So, now GM is downloading software into millions of vehicles' OnStar systems to prevent such an event. This comes under the heading of "What were they thinking?" Certainly the company had to be aware of software intrusions elsewhere. How could it have dismissed hacking of its own vehicles for so long? It was a consumer and PR failure to have disregarded the fact that OnStar was vulnerable. One hopes after this black eye that GM will act more quickly in the the future.
Thursday, September 10, 2015
Book stores were among the first businesses to be affected by the internet and it hasn't changed. Try as they might, bookstore chains haven't found the key to unlock increasing sales. The public has found other means, such as Amazon, to buy books. This raises the question of whether it is time for the mass merchandiser to give up, throw in the towel, admit defeat? It would not be the first to do so nor the last. It takes courage to hang in and tinker with the sales model to see if an answer might be forthcoming. At some point, however, one will need to admit that the economic proposition is fundamentally broken and the public has gone elsewhere. The relationship with consumers has gone flat and no amount of work will bring it back. What will there be to do other than shutter stores and pull back? The chain will be a shadow of the days when it was great, and it will have to content itself with that.
Wednesday, September 09, 2015
University of Utah health Care is pioneering cost accounting in health care and in the process is controlling expenses as it has never done before. Traditionally, cost accounting was reserved for manufacturing where stop watches and minutely examined activity were the norm. University of Utah Health Care has brought that standard to medicine, something that needed to be done but no one felt able to getting it accomplished. In the process, Utah has become the model for other states and health care systems. Its actions are an unusual but essential form of public relations in that it is giving the public efficient but effective care. Look for the Utah model to spread to other systems. It won't be easy to install in every healthcare system because there might be resistance to working within models of care delivery. Doctors might rebel, but for those systems that do install cost accounting, citizens will learn for the first time what health care costs.
Tuesday, September 08, 2015
In the migrant crisis enveloping Europe, Germany has stepped up more than any other country in taking refugees in. It will absorb 800,000 this year, and it claims it can handle 500,000 a year for several years more. This is a river of humanity entering a country that historically was standoffish. The numbers will change the culture of Germany over time and in its diversity, it might start looking like the US. This augurs favorably for Germany to remain a democracy in which demagogues have little traction, especially if migrants get to vote. Germany's stance is an act of country public relations -- reaching out to people who have nowhere to go and letting them find food, housing and healthcare. It should be a lesson to nations like the US, which is trying to seal its border to the South rather than develop plans and policies to integrate Hispanics into the American culture.
Monday, September 07, 2015
This fellow was a master of public relations. He knew what his customers wanted and he maintained a guarantee of satisfaction that built the company to what it is today. That L.L. Bean is a household name with an aura of quality is directly due to him. He should be placed in the pantheon of executives who have made a difference in American business. And, to think that he built his company in Maine, a state not known for large corporations or successful retailers. To executives who maintain that public relations cannot be achieved given the marketplace in which they operate, Leon Gorman is testimony that it can be done.
Friday, September 04, 2015
There is a race between the US and China over who can build the world's most powerful super computer. The contest has the hallmarks of unhealthy competition and building to boast -- something like the space program of the 1960s. One wonders whether there is a true need for a machine that can crunch one billion billion floating point operations per second. Nuclear weapons designers say they can use it, but do they actually need all that power? This is something that will be debated as the machine is built and once started, it is nearly impossible to turn back. There is a PR boast in having the most powerful supercomputer in the world. It's the "We're No. 1." chant that at its heart can be empty of meaning. So, let them build but keep a focus on what such a giant machine is actually used for. It would be a pity if there are not enough problems to solve at that size and speed.
Thursday, September 03, 2015
Sony Pictures is coming out with a film that tells of the discovery of concussion-related illnesses in former National Football League players. The NFL has only a few months to prepare for an onslaught of negative stories and for league players protests. The NFL has been dealing with the issue for several years but not with the background of a feature film detailing its denials and eventual acceptance of the facts. The film will dent its reputation and depending on how successful it is, the public might take away a deeply negative view of the league and its treatment of players. In fairness to the NFL, it has been trying to teach players how to tackle without smashing helmets and jarring brains, but that might be too little too late. The NFL has been riding high in public opinion for years. It might have to regain that reputation after this movie.
Wednesday, September 02, 2015
Google has an interesting conundrum with its driverless cars. It seems that they are too safe. The cars follow traffic instructions exactly but human driver's don't. Hence, the cars have been caught in circumstances beyond their software, such as passing through a four-way stop. Public relations would call for driver-less vehicles to drive like the public, even if it means bending traffic rules a little. The cars should act as much as possible as a safe human driver would. It is an irony that the vehicles have been in fender-benders, not because of what they have done but because of what careless drivers have done to them. Google is far along in developing the driver-less auto, but it still has a way to go. The chances are good that it will get there.
Tuesday, September 01, 2015
A company that can't get its numbers right has a fundamental crisis of reputation. Consider Toshiba. It has delayed its annual results a second time because it continues to find more errors in accounting. One asks what kind of company is it that has to do that. It is clear now that Toshiba had been running for years with jiggered books. This indicates corruption at the highest levels of the company. Indeed, the previous CEO stepped down along with several executives as a result of the errors. That is as it should be. It will take years for Toshiba to win its reputation back, and analysts have a right to be skeptical of bottom-line results. The PR lesson is clear: Don't mess with the numbers.