Public Relations for Small Business

J.T. Lewis, Jr., president of Lewis Welding & Engineering Corporation was the author of the third chapter in the 1948 US book, edited by Glenn and Denny Griswold, Your Public Relations (being serialised here with monthly posts). It is interesting that the focus on PR for small business has such a prominent place in the book. The argument put forward by Mr Lewis who operated a small plant in Bedford, Ohio, employing 261 workers, was that the principles and procedures for public relations are the same in big and small businesses. (For more on the Lewis Welding & Engineering Corporation see the Bedford Historical Society website)

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Public Relations for Small Business by J.T. Lewis, Jr., President of Lewis Welding & Engineering Corporation (written in 1948).

The first question that arises in any discussion of public relations plans for the small business is an acceptable definition of “small business.” We must investigate the inherent characteristics of a business and determine what makes it large or small.

Size alone is not the best yardstick. A small business has many of the characteristics of a small town. Population is not the only determinant. The quality of the mutual personal relationships, the scope of the enterprises, the methods of marketing the products, and the geographical location must all be considered.

In this chapter we are considering a small business as one in which the operations are all carried on at one location; there are no branch plants. The product is used in a limited area, so that national advertising and sales promotion methods are neither desirable nor necessary. The number of employees is small enough so that they can gather at a meeting and there will be mutual recognition between the employees and supervisors based on actual acquaintance.

As contrasted with the small business, we think of the large business as one with national markets, far-flung sales organizations, and branch plants in many locations, all of which introduce problems of management and communication with which the small business is not concerned.

Most large businesses had small beginnings. The transition period when the small concern is expanding rapidly is the most difficult to handle. Management personnel are preoccupied with problems inherent in the expansion itself such as new construction, new products, new customers and new manufacturing methods. The personal relationships may be put aside as being of lesser importance. Mr. Manager, you used to know every employee when your business was very small. How many do you know today? Can you call off even the last names of the last ten men that were hired? That is a hard test, but a good one.

Problems of Small Business

The purpose of a good public relations program, in both its internal and external aspects, is twofold. It must provide a suitable means of maintaining the personal contact between manager and employee, department head and clerk which is so necessary to mutual understanding and respect. It must also provide a means of communicating company background, policies and qualifications to the outside world.

The small business performs all the functions of the large corporation, – purchasing, accounting, selling, engineering and production, – but the administrative costs must be kept within reasonable limits. There is the perpetual dilemma to rationalize; the ever present question to answer. How can we balance the costs of employing the necessary talent with the limited funds left over after manufacturing costs are met? The department heads of the smaller business must have the same training and ability as their counterparts in the great corporations, and therein lies the problem.

Obviously, this problem must be met by employing a smaller number of highly qualified personnel, and having each of them assume several duties. This is the opposite of the problem of “divided responsibility”, but it is just as difficult to resolve.

Public Relations – Number One on the Agenda

In many instances, the head of your small business is beset by so many problems he must solve himself that the matter of public relations is relegated to the bottom of his priority list. In fact, it may be so far down that it is never even carefully examined. This situation is understandable, but a grave mistake. After all is said and done, what is the truly basic commodity in all businesses? It is human effort. Some of the effort is applied clerically, and some of it is applied manually, but people and personalities are at the back of it all.

It is an old military axiom that a poor plan, well executed, will succeed where the perfect plan, poorly executed, will fail. How true this is in business. The accurate communication of ideas is essential to the execution of the plan, and, in business, we consider the program of public relations as the program of communications. The management may have the finest plans and policies in the business world, but time, thought and effort must be spent on transmitting or communicating these ideas to the employees, the customers, and the community in which the business is located.

That being the case, somebody has to take charge and make it a full time job. It cannot be relegated, on the old spare time basis, to the production superintendent or some other already overburdened executive to take care of when he finds the time.

Scope of the Public Relations Program

J.T. Lewis continues by setting out four things which “any public relations program must accomplish”:

1. Keeping employee as well as shareholder informed
2. Provide for the various phases of employee welfare
3. Keep customers informed
4. Provide for maintaining the firm’s reputation in the community.

He then emphasises the importance of each of the four purposes of the PR programme to convince the company manager of the necessity to invest in such ‘intangibles’.

Internal Public Relations

The first phase of internal public relations is to maintain a constant line of communication from the policy-making group to the man who actually does the work. The very small business with a handful of employees will not be particularly concerned with this matter if the owner or manager will take the time and the trouble to talk to his employees daily and keep them in close personal contact with the business problems. The somewhat larger, though still small business, such as our own, poses the problem of maintaining the communication with a much larger group of employees. With this number of employees to consider, the president or general manager cannot speak to them individually every day and must use other means of communicating his ideas and those of his department heads.

These ideas must not only be transmitted promptly but they must be transmitted accurately. If they pass through superintendents and foremen and assistant foremen and group leaders before they reach the workmen, there is every likelihood that the information will be so distorted by inaccurate repetition that it will not be uniformly understood. The head of the firm and his policy-making group, must devise ways and means of transmitting information so that it is distributed uniformly and accurately.

For example, if one foreman honestly believes that it is his duty to deny leaves of absence in the interest of good attendance, and another foreman in the next department believes that the management intends to be liberal about leaves of absence, misunderstandings are certain to occur with the first two requests that are made.

Channels of Communication

The chapter next lists a number of “simple and readily administered methods of transmitting information to the employee and obtaining his ideas.”  These include:

• An employee handbook
• An annual report
• A monthly letter from the president
• An administrative organization chart showing lines of communications upwards to the head of the company
• Bulletin boards
• Regular weekly meetings of department heads where mutual understanding across functions is achieved in discussion of policy decisions and general instructions
• Regular weekly meetings of foremen at which company policies as well as operational problems are discussed – to be held on the same day as the interdepartmental meeting to ensure works managers transmit information without delay
• An employee suggestion system – involving anonymous submissions judged by a committee of employees.

Each of these methods is discussed in further detail to evidence aspects required to ensure effectiveness.  The low cost of the techniques is also noted as a “small investment” in gaining “mutual understanding”.  In relation to letters to employees, J.T. Lewis highlights “the idea of making this letter personal”, arguing for it to be multigraphed rather than printed and mailed, first-class to the home, not distributed “in the shop”.  He advocates a gradual process of communications to gain employee confidence.  Interestingly he says:

“Never use the letter to express bitterness or disappointment, don’t fill it up with unimportant data on new babies and birthdays, but use it as a means of telling the workman all you can about his job. Stress his opportunity for advancement and show recognition and appreciation of his contribution. That is important enough to warrant the writing of any letter, without cluttering it up with nonsense to try to prove that the boss is a good guy after all.  Where the budget permits, some small firms may supplement letters to employees with an inexpensive company publication.”§The Employee and His Job

The pendulum of public opinion has swung a long way since World War I. The shorter work day, group insurance, adequate heat and light, and plant sanitary considerations have come to be accepted practice. Your workman or clerk is a human being first and your employee second. As such he is endowed with strange mental quirks such as all of us seem to have. He will take just as much care of plant and equipment as the manager demands, but no more. If the shops are cold, poorly lighted and dirty, why should he make an extra effort?

Further pragmatic counsel relates to recognising that a worker cannot be “coerced into being enthusiastic or diligent” but will “respond positively to improved working conditions, a knowledge that his job is secure and a clear understanding of what is expected of him. If he does not respond either he has not been sold on the sincerity of the approach or he is a chronic malcontent who should be replaced.”

Cost of a Public Relations Program

The small business must take as broad and generous an attitude in its employee relationships as its larger counterpart. Expense? It has been said on good authority that the frame of mind alone will influence the productivity of the individual as much as 20 percent. How much can we afford to pay to keep the individual employee contented, proud of his place of work, and putting his latent skill and enthusiasm into his job?

The enthusiastic employee is the goal of your internal public relations program. Set your own percentage of payroll as a budget figure. We spend about $10,000 per year on our program, which sounds like a heavy appropriation, but when it is compared with an annual payroll of $800,000 the reasonableness of the expense is obvious.

External Public Relations

Customer relations

Lewis distinguishes between three types of small business – those that distribute product directly at retail, those who employdealers or distributors and those who sell directly to manufacturers. Considering his own business in the third group, Lewis notes that it does no advertising; a decision he states is a “highly complex question” as “it is most important as one medium of maintaining external public relations and has been used successfully by many small businesses”.  He continues to discuss “The personal calls of salesmen and engineers, technical papers in trade periodicals, attendance at meetings of trade or technical associations” as “all part of the pattern.”

Value of personal contact

We feel that the best means of communication for the small business is by personal contact and by personal letter. Not just sales calls for the personal contacts, but the exchange of ideas between engineers, the trouble shooting trips of inspectors, and the discussion of mutual problems between production personnel. The small business usually cannot afford full page newspaper advertisements or the center spread in the weekly magazines. It can invoke a policy of continuous personal contact with its customer and get the same or better results.

Next, the chapter outlines how Lewis maintains customer relations – with the sales manager taking responsibility for initiating contact with potential customers, followed by the engineering services and the chief engineer.  Once a contract is signed, inspectors and engineers manage ongoing contact, with sales managers visiting customers’ executive officers twice a month to develop business.

Relations with Shareholders

This is an area where Lewis notes the small business has a distinct advantage having a small number of shareholders who usually “have an active part in the management” and hence do not need formal communications techniques.

The Small Business and the Community

Whether a company be large or small, its reputation in the community is important. The most satisfactory labor market is usually the nearest one, so the plant must be known as a “good place to work”. It is a common theory that family relations are poor business relations, but we do not find it so at the wage-hour level. This is said to be a result of “pride in workmanship” as “an inherent trait” shared by family members.

Participation in community activities is an excellent builder of good will… The factor of civic interest should not be overlooked because much of your local reputation depends on it.

Conclusion

We have attempted to outline the possibilities open to the management of a small business by careful attention to its public relations. Approaching the problems of management from any angle, we find that their solution, at least in part, can be more readily achieved through the application of some fundamental principles and techniques.

If your employees know what is expected of them, and have confidence in their leadership, half the production battle is won. If, further than that, they sincerely believe that their superiors really and honestly have the employees’ best interests at heart, the rest is easy. The manager of a small but rapidly growing business is most likely to neglect these little contacts with the employee – not deliberately, but because he has persuaded himself that he is too busy. He thinks he is too busy, but the employee, who “knew him when”, just things he has gotten a big head.

One of the finest things about the very small business is the close co-operation and mutual understanding possible among the few people concerned. To maintain that esprit de corps, that vital personal interest, is the most difficult problem facing the management of a growing company. We do not pretend to offer cut-and-dried solutions which will be applicable in every instance. We have set down the more important parts of our own program, which have brought about good results, with the hope that they may stimulate others to try them and modify them to meet their own situations.

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Editors’ Note

This chapter concluded with further reflection from the book’s editors.  They said:

The principle handicap to sound public relations operation among the smaller companies is widespread misunderstanding and prejudice in the minds of management. Too often it is stubbornly assumed that public relations is an involved, technical and costly process profitable only to large corporations. Too often, too, management in smaller business honestly believes that public relations problems are inherent only in mass operations.

Further they argue:

The successful managing executive today must have public relations training and experience regardless of the scope of his operations. If proof were needed to support this statement, one could point to dozens of men who have recently been elected presidents or chairmen of corporations becuase of their ability as public relations executives, and usually in spite of less knowledge of the other functions of management.

This knowledge and experience on the part of a managing executive is essential today even if the corporation does maintain a competent public relations department, retain outside counsel, or both. These professionals cannot function adequately unless plans as well as policies stem from management thinking.

Finally, they state that lessons can be learned from big business as well as gaining “basic information on the development of public relations techniques and procedures” from books, courses and clinics operated by PR and trade associations.  Unsurprisingly they conclude by stating that external professional help can be employed “at modest fees”.

In the rapid development of public relations as a management function, basic principles and practices have been established. The important thing for management to learn is that application of them is universal regardless of the size of the company. Principles that are sound for United States Steel are just as inviolable for a small manufacturer. Furthermore most of the techniques evolved by big business can be adapted to medium-sized and small businesses.

Public relations problems are usually identical except for proportions. This is true not only in manufacturing, but in education, religion, social and civic welfare and in every field of human endeavor Prescriptions are usually the same. The main difference is in dosage.

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Addendum:

This is a fascinating chapter both with its focus on public relations for small businesses and the scope of ideas that are included within that remit.  Rather than focusing here on the tactics mentioned – which arguably have needed to change to reflect more modern opportunities for communications – my interest is drawn by the strategic value of PR that is recognised throughout the chapter.  Here we have an integrated approach which not only includes both internal and external communications, but argues for management in various operational functions having training and skills in public relations.  One major difference between 1948 and today of course, is that even small businesses can operate on an international, global or multinational basis not just operate within the locality of their geographic base.  Arguably, this development means that understanding reputation, stakeholders and how to use public relations to address various problems is even more essential today. However, I wonder how many small businesses are making the same arguments noted here regarding why they are not investing in public relations.

For links to other chapters in this series, see the book contents page.