Monday, April 30, 2007

Two Views 

It is fascinating that the key communication to investors is financial accounting data but financial data is not and never will be precise. Now, there is a movement to standardize accounting principles worldwide -- something that should have happened long ago. But, standardization means accounting in the US will move away from "bright line" to principle-based approaches. A bright line rule states an accounting policy with a specific limit. If it has the following characteristics and equals X, then it is accounted for this way rather than that. A principle-based policy says that it if it has the following characteristics, it is accounted for in one way rather than another. Enron was able to game the accounting system through bending "bright-line" principles to fit a mold. On the other hand, accountants in the US demanded bright line principles to stave off lawsuits. The defense was that if an accounting principle met a specific rule, the accountant wasn't at fault, even if a client was committing fraud.

What is interesting in this discussion is that at the base of all the hard numbers is estimation. It is estimation within prescribed limits but judgment nonetheless. That is why it is baffling that institutional investors and analysts demand reams of numbers to fill out financial models, as if numbers were hard truths and the soft data of a company less so. However, in the end the truth of any company lies in the integrity of its leaders, something that can't be measured in a financial statement. Leaders who demand clean financials get them and those who game rules produce data built on fiction. Or, to put it another way, leaders who have proper regard for the investing public and want to build good relationships with them are the ones who insure that accounting is clean. Sound familiar?

Friday, April 27, 2007

About Time 

Being a Californian by birth and upbringing, water has always been in my thoughts. California is a dry state, not as dry as Arizona or Nevada but parched nonetheless and dependent on water runoff from snows in the high Sierra mountains. This year, Southern California is entering the second year of a drought with only about an inch of rain for the last 10 months. Yet, water conservation was never a major issue unless momentarily there was a sector of the state that went dry. Now there is a public relations campaign to promote conservation. It's about time. The history of water in the state has always been one of finding it, taking it and moving it from one part of the state to another. But, there isn't much more to find and move. Water has long been an issue between population centers and agriculture, a huge user. Farmers have water rights that date back decades. Thirsty suburbanites need water for basic household use and swimming pools. There are more suburbanites who go to ballot boxes than farmers.

Water is an issue globally, especially with climate change. It will be the subject of many more PR campaigns over the next century. It is a topic PR practitioners should learn about, especially if they live anywhere near the west coast of the US or in Europe where a drought is entering a second year. Changing habits about water use is hard but PR will be called upon repeatedly to help in the task.

Thursday, April 26, 2007

Good Tool 

This is a handy tool for visual presentations. It's compact, complete and illustrative. It shows genius in its own presentation. There are diagrams here that I have never used and didn't know existed.


Some images are indelible, self-explanatory and explain the relationship of groups to the rest of society. This is one. The Taliban have performed an unintentional act of anti-marketing for their cause. One has to ask about the belief structure of any group that allows a boy to behead a man on camera. There isn't civility or protection of the young or expression of values that Western society lives by. Hate has its own anti-PR.

Wednesday, April 25, 2007


This disaster unfolding across the US is typical of what happens in most crises. One doesn't know why something is happening. Theories and rumors abound. Activists claim that one or another party is responsible. The disaster is a canvas on which many different explanations are painted until scientists or investigators find a cause. Even when they do, there will be disputes over how the cause happened. In the case of honeybees, if it is a pathogen, there will be fingers pointed at chemicals, environmental disturbances and more. Companies may find themselves on the defensive without a counter for allegations that lack solid foundations.

Most crises happen in a gray zone without a clear explanation for why something happened, yet people demand answers. Ambiguity invites speculation. Speculation invents rumor. Rumor damages reputations quickly.

Communications in crises are always interesting.

Tuesday, April 24, 2007

The Price of Reputation, Cont. 

CA, a company riven with scandal and a former CEO awaiting jail time, is still trying to recover. The current CEO notes how far the company has come and how far it has to go. The scandal continues to overshadow everything the company does, even though customers are ready to move on. It will take years for CA to live down the accounting frauds that were at its core. CA will need to be especially diligent in reporting finances and in handling customers. This is like a DNA change for the company, which once gloried in a buccaneer spirit. CA would buy other software companies, strip out employees, keep the code and then play rough with customers in terms of license renewals. This has apparently all changed, which means several ranks of CA managers have had to change as well.

It's never easy to turn a company culture around, especially one as aggressive as CA once was. The aggressiveness came from its founder who angrily dismisses contentions he was involved in the fraud as well. The challenge remains for the current CEO to grow the company without the two-fisted attitude that once drove it. Reputation, once gained, is difficult to lose.

Monday, April 23, 2007

Good Presentation 

This information site dedicated to explaining who funds US campaigns does wonderful work. The social networking illustration is a fast way to understand who is behind each candidate. Note the number of financial and law firms.

These kinds of visual tools are useful in corporate web sites as well. PR practitioners ought to be pushing for them because they increase transparency. For example, rather than dry listings of a corporation and its divisions, bubbles could show how divisions relate to corporate and products and services relate to the divisions. The bubble diagram could explain any connected or tiered information.

Corporate web sites don't have to be boring.

Friday, April 20, 2007


One of the buzz words of the "Web 2.0" developers is engagement. How does a company get an audience engaged in a brand? What some developers are forgetting is that with more than 70 million blogs and 19 million participants on Facebook, people are engaged more than at any other time in history. It seems to me this engagement is the realm of PR because amid millions of daily comments are testimonials to a brand, unpleasant collisions with it and other interactions that tell one how people think about a product or service. At least this is true for one of our clients. This essay suggests a different model for dealing with the engaged that is targeted to PR departments specifically.

As usual, I welcome your comments and criticisms. It is the 63rd essay posted on online-pr.com for use by PR practitioners.

Thursday, April 19, 2007

Modern Tragedy 

This article and this one too show how much communications have changed when tragic events occur. Students naturally gravitated to online for information, to tell their stories and to express grief and solidarity. What happened is instructive for PR practitioners. Social networking and blogging have a part in communicating modern tragedy as do online video and audio.

We must pay attention to these media because they can spread news as well as rumor. Part of the tragedy of the events at Virginia Tech is that a student was wrongly accused for several hours of being the shooter because he was known to like guns. It was an error picked up and repeated by at least one individual in the mainstream media.

One should not rely just on traditional press releases or mainstream media or a web page to get the word out now. We should prepare for a spectrum of media, including blogs where we can post facts and expressions of sympathy as they come in.

It's more complicated. The speed of information has increased, and we have to run faster just to stay in place. If Virginia Tech's administration can be accused of anything, it might be that it misunderstood the role of online media as the terrible event unfolded. It won't make that mistake again, but it also will be many years before students and parents forgive. They won't forget.

Wednesday, April 18, 2007

Shades of Mortality 

Vonage, the phone company, is facing extinction because it violated patents when it started its VOIP phone service some years ago. It has already lost its CEO and worse, it has now admitted it was lying about finding a "workaround" to the patents it violated. There's not much credibility left for the company and its moves smack of desperation. Who would want to become a customer of a company like this -- or remain one? There are plenty of providers of VOIP services, and Vonage has been the weakest player for some time.

How would you like to be doing PR for a firm like this?

The Cost of Publicity 

Check the cost of publicity in this article on the budget for making a movie. It is one of the lowest expenditures of all -- lower than the bribes paid to officials in foreign lands. In fact, it was budgeted at less than the cost of the camels used in the film. Who said PR isn't a bargain?

Tuesday, April 17, 2007


The killing of 33 students and professors at Virginia Tech University yesterday is instructive. The tragedy unfolded partly because investigators made an assumption that the killer had left the campus. The mistake was reasonable but fatal. It will take years for the university and police authorities to live down the error.

The two-hour gap will be analyzed over and over as will the decision to let classes continue. In hindsight, the university will look foolhardy for failing to communicate more quickly. Almost certainly, distraught parents will sue. The university's president is dealing with a crisis that will define the school for decades. There is no communication at this point that can make what happened any better. The effort now should be to explain what happened in as great a detail as possible. Perhaps in the explanation, the university's lack of action will be more understandable. Sadly, it will take weeks for the full story to emerge and in that time, rumors and speculation will mount. Students, parents, teachers and the public may make up their minds before the facts are in.

The incident is a public relations nightmare of the worst kind.

Monday, April 16, 2007

Rebuilding Brand America 

Dick Martin, the author of Tough Calls, one of the best books I've read on PR in years, has a new book out called Rebuilding Brand America. This new work is an in-depth study of Anti-American feelings about the globe and what the US government and business need to do to turn longstanding negatives around. Martin appears to have read everything and talked to most people concerned with the issue. His book is an in-depth discussion of sources and roots of the problem, the feeble attempts of the US government to address it and where business and government should be going.

The book is pragmatic with specific remedies. My sagging feeling, as I read his prescriptions, was that it made too much sense. Of course, what he recommends should be done, but chances of it happening are not great. The US government is too chaotic to coordinate in ways he calls for and CEOs of multinationals appear to consider themselves more as citizens of the world than citizens of any one country. This doesn't mean that what he calls for can never happen. The pessimist in me feels the odds are steep. Certainly the present administration in the White House is incapable of doing anything Martin suggests. It is barely functioning as it is. His work is really targeted at the next administration and current business leaders.

I just wish my nagging feeling about business would go away but it doesn't. After listening to leading CEOs of how they operate globally, it is not out of the question that great American businesses may depart the country someday. That time will come when multinationals feel it is to their advantage to do so. Or, if they don't leave the country legally, their production will have left the country and economic power with it. This is far along already. So, I don't see American business cooperating with American government to turn around Anti-American feelings. I see American business becoming exactly what he describes -- global and local -- to the point where it no longer appears American and frankly, that's preferable. It's up to the US government to catch up, which it is isn't doing.

Martin makes abundantly clear that what America faces isn't a communications problem alone. All the pro-American advertising and publicity campaigns that one could buy won't turn around the opposition. What needs to happen is more fundamental. However, surveying the present candidates for the White House, I wonder if any of them is willing or able to take up the challenge.

Friday, April 13, 2007


This is an interesting, if risky, promotional device to combat corruption. One wonders if it is going to work for long, especially when those who receive the phony money realize what they are getting. As the article notes, graft in India is embedded. That is why in spite of billions that Union Carbide paid out for the accident in Bhopal, apparently little reached the accident victims. The rest, according to what I have read, leaked into numerous hands. This kind of payoff destroys trust and breeds cynicism.

It is no credit to PR that it started by buying publicity from editors in the early 20th Century, and it continued with payoffs until late in the century when newspapers put a stop to gifts reporters received. PR merited a sleazy image while this was going on. Today, it is difficult to buy even a lunch for many reporters. It has gone too far in the opposite direction. PR still hasn't gained the trust of many reporters but that is another issue. Reporters rightly wonder when we tell the truth and when we shade it because we are paid spokespersons. Their cynicism is close to that of India's citizens.

Thursday, April 12, 2007

Media Relations? 

Here is a guaranteed way to turn a medium against you. Accuse a reporter of being paid by the opposition to write stories. One wonders what the Nevada governor was thinking by accusing The Wall Street Journal of being on someone's payroll. It's stunning anyone would think that much less say it aloud. It won't stop the Journal from reporting, and it makes the governor look silly. This is a case where one asks where the governor's handlers were when he made the statement. Unfortunately, the governor's press secretary repeated the rumor rather than standing up to the boss or making light of it. Anyone that far gone into conspiracy theory has compromised his ability to do his job. Nevada is in for an interesting time.

Wednesday, April 11, 2007


There is an unfairness in life and business that allows one person to get away with outrageousness but not another. This is a case. The racist remarks radio broadcaster Don Imus made would have gotten anyone else fired. Imus gets a suspension. Perhaps, public pressure will result in an eventual end to his career. Other broadcasters, however, have been taken off the air permanently for less. It must be comforting to Imus to have a charmed existence. Some people seem immune to the public.

Public Pressure 

The President of the United States may be convinced he is bringing democracy to Iraq, but thousands in Iraq differ with his view. The public pressure of open and peaceful demonstrations is difficult to ignore -- even in the White House. When does a President accept he is on a wrong course?

PR and Mortality 

PR enters a new realm of urgency when a company faces a threat to its existence. Vonage is trying to stay in business after losing a patent suit, but there is a good chance it won't. Investors are fleeing. Customers don't know the future of their telephone service. Management is acting bravely, but the court can put a stop to the company at any moment. Life in Vonage's PR department must be tension-filled. There are some experiences in PR one doesn't look for. This is one.

Tuesday, April 10, 2007

Learned A Lesson 

It appears that presidential candidate Barack Obama has learned a lesson from Howard Dean's campaign in the last presidential race. He is using the internet as an organizing and fund raising tool successfully. The 5,000 "house parties" conducted for him so far are grassroots organizing at its best, and show the power of the web for organizing. There is much to learn from how Obama is using his site and MySpace. It is interesting that other candidates aren't as proficient yet. Sen. Clinton apparently is approaching the campaign in a traditional way and doing well, as is John Edwards. Time will tell whether one approach is better than the other. Meanwhile, as PR practitioners, we have a living case study from what is happening on the campaign trail.

Monday, April 09, 2007

Time to Change? 

Most PR practitioners were trained in a marketer's model summarized be the acronym, AIDA (Attention, Interest, Desire, Action, and sometimes, S for Satisfaction). I've begun to wonder, as others have, whether this model should be changed to reflect engagement with individuals. An engagement model would better reflect the role of blogs and bulletin boards in the PR and marketing mix.

The challenge with an engagement model is that engagement is positive and negative. One can write good reviews of your product and service or bad ones. But the cumulative effect of opinions has direct influence on purchase decisions of others and disrupts the AIDA model. Increasingly, as a PR practitioners, we spend as much time worrying about blogs as we do about gaining exposure. For example, we have a client that suffers from continuous negative comments in blogs. The comments contribute to a general impression that its service is poor. What this situation needs is direct engagement with bloggers outside of the AIDA model in order for the AIDA model to work. Engagement is in the form of direct one-to-one outreach to critics to respond to criticisms, alleviate concerns and perhaps, gain or keep them as customers. If successful, engagement may result in positive comments at some point that balance the negative and provide a better environment.

Others have described the role of engagement online in greater detail. I'm still getting there. But it seems to me that PR and customer service should be leading the way in changing the model.

Friday, April 06, 2007

Looks Good on Paper 

The news that Google's co-founders took salaries of $1 each last year is interesting. Both men are billionaires. They don't need a salary. On the other hand, the symbolism is instructive. They could have taken salaries as co-founders -- and big ones too. They are entitled by reason of being co-founders still actively employed in the company. I'm sure this wasn't lost on their employees who can look about them in Silicon Valley and see other company founders who pay themselves well indeed. Actions do speak louder than words.

Even a cynical employee would admit that a salary of $1 is in line with Google's philosophy of "do no evil." It is a personal statement that "enough is enough." Greed has done damage to Silicon Valley and its occupants over the decades since the Valley has risen to prominence. The Internet Bubble was greed out of control -- far too much money chasing "pots o' gold." In that light, Google's co-founders stand for something different. More power to them even if they should take huge salaries in the future. You can call the token salaries PR but, if you do, note that it is the best form of PR.

Thursday, April 05, 2007

Hold that Buzzword 

We're barely into the jargon surrounding Web 2.0 and people already are writing about Web 3.0. They are making big claims for this "new" movement as well. Since no one can precisely define Web 2.0, there is no reason to be accurate about Web 3.0 either. Isn't it about time to slow down on buzzword generation? This is getting as silly as the jargon during the Internet Bubble. But, I suppose if one talks fast enough with seeming knowledge of what one is saying, venture capitalists somewhere will listen. It's more about money than the progress of web technologies.

Playing to the Home Crowd 

Now that the Iranian hostage crisis is over, it is worth noting the communications elements in it. Quite clearly, the Iranian government was playing to its citizens. Look at us and how powerful we are. But, the Iranian government was playing on the world stage too and saying the same thing. The difference appears to be that the home crowd was motivated by the government's action while the rest of the world was alarmed.

The Iranians seemed naive in how they handled the situation at the beginning. There was much table-thumping and bold language and exploitation of the British crew on TV. Their communications were those of petty dictators, such as North Korea, more than of responsible members of the world community. If the Iranians wanted to project power on the world stage, they chose a bad scenario and acted it poorly. There are better ways than trumpeting an alleged trespass in international waters. In the end by communicating poorly and handling the situation badly, the Iranians came off worse than they might have intended. That happens when one plays to the home crowd.

Wednesday, April 04, 2007


This mashup is clever in how it explains the rise and fall of real estate prices in the US. Numbers don't have to be boring, and in this case, it is hard not to stay for the entire run of the roller coaster as it wends it way from 1890 to the present. It is instructive as the coaster climbs and climbs then plunges back to a lower value only to climb again. I could envision the price of my home rising and falling proportionately with each dip and rise.

Such animated ways of explaining complex data could be used more frequently in the corporate environment. Perhaps a reason why they aren't is a combination of a lack of creativity and courage to do something different. Yes, it takes longer to understand the roller coaster than a glimpse at a static picture, but the experience is different and more meaningful with animation. Because of the web's flexibility, it would have been just as easy for the author of this animation to present the data in three ways -- tabular, static graph and animation -- so readers could look at data in a way they prefer to experience it.

Too often on web sites, especially corporate web sites, data is dumped onto the page, sometimes with a thought to the reader, but just as often, without consideration for those who are going to use it. As PR practitioners, presentation is a skill we bring to organizations we represent. We should be in the forefront representing the public that uses our organizations' web sites and pushing for better presentation. Regrettably, in too many organizations, PR has no say or control over what is done on the web, and it is our fault this happened. PR ignored the web early on and resisted learning about it until it was established as a separate entity within most organizations. Today, we are in catchup mode, and it is difficult to work our way into a well established technology.

Ought to Know Better 

In an era of identity theft, actions such as this are quick ways to harm corporation reputation. If true, someone at Radio Shack, probably a lower-level employee, wasn't thinking and dumped no longer needed records. This can happen in any company at any time but the consequences are lawsuits such as Texas has filed. Good PR is smart behavior at every level of a company's ranks and not just at the top.

Tuesday, April 03, 2007

Reputation and Effectiveness 

This article speaks for itself.


I found this article interesting because it makes one wonder where the writer has been. I've seen numerous stories, especially in The New York Times, that began in blogs and eventually showed in print. The cooperation that the writer calls for is underway and stories like this are becoming common. PR practitioners are or should be monitoring blogs on a daily basis for client mentions or issues that concern their organizations.

Monday, April 02, 2007

Mashups and Activism 

When I posted the article on mashups last week, I failed to give one reason why PR practitioners should be involved in them -- because activists are already using them. Here are mashups that make this point:

While most of these are politically oriented, they don't have to be. Your organization could be next.

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