On August 15th my quarterly copy of The Public Relations Strategist (published by the Public Relations Society of America) arrived. The Summer 2008 edition’s cover highlighted the feature article, “Where PR Belongs: A Move at Chrysler Spurs Debate.” The provocative title drew me in, so I literally dropped everything (but the magazine) to have a read. Although Chris Cobb’s article focuses on changes to the reporting structure at the US-based auto giant (a company that is now private), it struck me how many of the issues were similar to the “Institutionalization of PR” focus and discussions covered in PRC colleagues’ posts (in preparation for the upcoming Euprera conference). That same afternoon I sent a message of query to The Strategist’s editor, John Elsasser, asking whether the article would (or could) be made available to a non-PRSA (and non-subscriber to The Strategist) audience. On Monday morning a gracious affirmative from John arrived in my in-box.
The core article can be accessed on PRSA’s website here. (I don’t know if the article would automatically have been placed online and accessible to all, but at a minimum thanks are extended to John Elsasser for his speed at facilitating this request and supplying the URL directly.)
Two sidebar articles in the print edition—which provide some context as to the significance (some of our conversationalists say not) regarding the changes at Chrysler—weren’t included in the online version. I’ve transcribed some of the most pertinent parts. The first, “Report: CEOs Say Communications Executives More Valuable Than Ever,” points to “The Authentic Enterprise” report from the Arthur W. Page Society. This release (which Toni Muzi Falconi detailed in an earlier PRC post) indicates, “…the consensus among respondents that top communications executives are more valuable than ever, and the importance of communications will only increase with time.” In addition to communication, CEOs are looking for chief communication executive who:
• know the business
• have an extensive communications background
• can see around corners
• have C-suite credibility
• maintain extensive internal relationships
• are team players; and
• educate their colleagues
The second sidebar article, “Survey: Statistically Sound Correlation Shows PR Function Stronger When Reporting Directly to CEO,” gives a synopsis of the compiled data from the 2008 USC Annenberg School for Communications‘ Public Relations Generally Accepted Practices (GAP) study (which took place over the past six years). It “asks PR practitioners with diverse specialties from a variety of organization to identify the best practices in public relations.” The reporting structure factors heavily into the GAP, showing that those organizations with larger PR budgets are:
• significantly more likely to report to top executives
• be invited into organizational strategic planning
• work with more than one PR agency; and
• coordinate and integrate the various communications function
In the study, 64 percent indicated they reported directly to top executives. Next highest was through the marketing department (23 percent), “…but the study found that these PR operations, though sometimes lavishly funded, do not enjoy the internal influence that C-suite-reporting PR teams take for granted.” For the purposes of this lead article, perhaps even more significantly (in the sidebar) was the paragraph, “Respondents who are unhappy with their reporting structure typically work under the legal, finance, human resources or strategic planning departments, or the heads of business or operational units.” It was noted that though the correlation doesn’t prove causality, it reinforces the importance of a direct reporting relationship.
* * *
On an earlier PRC post, various opinions have already been voiced about this article by Heather Yaxley, Benita Stein, Fraser Likely, Toni Muzi Falconi and Estelle de Beer. Visit the online article on PRSA’s website to read comments to date by Elizabeth Hirst, Benita Steyn and Olanda Stanywyk.
What say you? Are similar significant PR reporting structure changes happening in your organization or country?
Toni, maybe we can entice Dr. Terry Flynn to debate on the issue; he’s covered the topic (briefly) on his own (new) blog, Strategic Public Relations and Communications Management in Canada: The Detroit Three — Bail Outs or Bailing?
Hello there!
What do you think of Chrysler’s most recent and immediate post bail out pr initiative? See http://4.bp.blogspot.com/_FoXyvaPSnVk/SVEAGIkwKJI/AAAAAAABcvs/QojdRboR6tU/s1600-h/ThankYouAmerica.jpg
And also carefully read Bob Nardelli’s (ceo) short copy which says:
Thank You for Investing in Chrysler – America’s Car Company
Chrysler is committed to:
• Providing cars and trucks you want to buy, enjoy driving, and will want to buy again.
• Delivering products with the best quality and value in our Company’s history.
• Improving fuel economy to support America’s energy security and environmental sustainability.
The United States is home to 74% of our employees and over 3300 dealers in communities across this country. Of every dollar we spend, 78% is spent here at home. On behalf of the 1 million people who depend on Chrysler for their livelihoods, thank you for investing in Chrysler, and America.
Bob Nardelli
Ok.
When I first heard about this the day before yesterday I was with a highly reputed global british financier and asked him for his reaction. Surprisingly it was a positive one: I don’t see anything wrong with this and I am sure that at least the 74 thousand employees of Chrysler were happy with it. Do you think it is a waste of taxpayer money? I asked. I do not, he replied, as I can think of many other ways that money will be wasted, such as legal, accounting and many other immaterial activities which are not as relevant to the company bottom line as employee moral is.
My first guzz reaction was: I would not have counselled this move, but once done there is nothing wrong to stand behind it and argue it.
Then I remembered our conversation about Chrysler moving the pr responsibility under human resources…but could not find any significant correlation.
And you?
I think I should retract my statement above that “I don’t believe that it is a move forward to have PR report to an HR exec”. Maybe it is not such a bad idea, after all! This sudden change of heart, less than 24 hrs after I wrote it, was brought about when I read an internal notice from the academic institution to which I am affiliated (as a part-time lecturer, hence the channel of communication).
I quote: “The Department of Public Relations MANAGEMENT is moving from the Faculty of Business to the Faculty of Informatics and Design”. (The word MANAGEMENT was capitalised by me).
I have no further comment.
A short article in the McKinsey Quarterly Newsletter of August 2008 expressed the view that business leaders around the world are deeply concerned about the intensifying competition for talent. One of the factors compounding the difficulties of recruiting enough appropriate talent is the confusion about the role of HR. Yet another is the declining influence of the HR function.
A McKinsey survey indicated that:
• 51% of HR professionals thought that HR is an administrative department and not a strategic business partner, while 60% of line managers held the same view.
• 38% of HR professionals thought that HR lacked the authority/respect to influence the way people are managed while 47% of line managers held the same view.
• 43% of HR professionals don’t think that HR provides enough support to line managers while 58% of line managers are of the same view.
• 25% of HR professionals lack the capabilities to develop (talent) strategies aligned with business objectives while 58% of line managers were of the same view.
While I already said in another post and also on the website of the PRSA’s “The Strategist” that I don’t believe it is a move forward to have PR report to an HR exec, nothing in the McKinsey findings (or in the Authentic Enterprise Report or GAP findings) convinced me to change my mind.
What I have not said before is that I have no desire to ‘protect’ the PR function or its executives. If they are not competent, they should report to whichever function they are shifted to and count themselves lucky to have a job.
But I do teach in the management sciences where the achievement of organisational goals is the ultimate driving force. I must therefore make it clear that, in my opinion, the achievement of organisational goals (and thus of the organisational mission) will not be facilitated or maximised by having the PR function report to an HR executive. Having their own problems in expanding their role and finding their identity in a new business paradigm, an HR exec is unlikely to have the inclination, knowledge or competencies to lead the PR function to excellence and maximise its contribution to organisational strategy formulation. The latter is different from just ‘managing’ the PR function in the same old way. Any half competent manager/exec from whichever function can do that.
But that is not what I am talking about. I am talking about leading the PR function into a new role, of expanding competencies, of using the window of opportunity provided by the new organisational and societal focus on stakeholder engagement and issues negotiation, by assisting in providing direction in the new business paradigm — not only to the PR function but especially to the organisation — with regards to CSR, reputation risks, sustainability, corporate governance, contribution to the Triple Bottom Line. Is it realistic to expect that the HR executive can lead PR into this role?