Top >> Opinion__Comment Opinion: Three Examples in 2003 show how Crucial PR is to Corporate Success By Grant Common Editor published December 2003 Grant has 30 years direct experience in public relations and communication in Australia and New Zealand - as well as directing and managing programs in the UK and USA. He has consulted to Governments, publicly listed companies, industry bodies, marketing organisations, multinationals and not-for-profit organisations. He is Managing Director of Sydney-based Network Communications and principal of Comsult Communication Design, a consultancy specialising in the emerging management discipline that focuses on how organisations internally plan, structure and organise their communication. As a Fellow of the Australian Institute of Company Directors (having completed the Company Directors Diploma examination) he is also one of the few PR practitioners to have the perspective of the company director. Evidence of the increasing role that PR has in how modern organisations are perceived was highlighted by three Australian examples in during 2003. AMP - once the doyen of Australia’s corporate establishments - has quite simply had one hell of a year. It’s corporate reputation is in tatters and it’s had billions wiped off its market capitalisation. Fundamentally, AMP’s downgrading was supported by some truly awful financial figures. But what made worse was the consequences of perceived mismanagement, lack of disclosure at vital moments, and the way senior management and the Board occasionally behaved and communicated. The AMP experience shows how important the management of communication is to today’s major corporations. And it’s a real lesson on the importance of intangible (behaviour and perception) v tangible factors (actual results and strength of balance sheet). The verdict on its PR - recognised the need, put in a huge effort, but the organisation made such fundamental errors of judgement at the most senior levels at crucial times that it destroyed any good work done. However, organisations such as AMP learn from such experiences. So should AMP survive don’t be surprised if 5 years from now they are being heralded as a great Australian success story - but it will require a huge effort in areas of the business itself as well as their communication, transparency and PR . Much has been written about Pan Pharmaceuticals whose products were compulsorily withdrawn from the marketplace by the TGA. Pan appears to have exemplified everything a modern company should not be. The Pan experience seems to suggest a production and sales driven company that was dominated by a single individual. There seems to have been little acceptance of the fact that most organisations these days are beholden to the goodwill of a group of key stakeholders who hold great power. According to reports, not even a fundamental product withdrawal/crisis plan was in place despite the fact they made products they made.The verdict on its PR - Pan’s lack of understanding about the role of PR was a major factor in destroying the company. Not only were fundamental communication policies and procedures lacking; when the crisis hit, Pan simply had no idea of how to respond and cope with wave after wave of accusations and comment. As a result it was cruelly exposed in the headlights! And Pan wasn’t helped by the rather poor PR efforts of the TGA either. The real value of an organisation often comes to light in a crisis. Such has been the case with McDonald’s Australia, which has shown itself to be a cut above many others in its response to the obesity crisis. PR is not about just about talking - it’s about doing. And McDonald’s Salads Plus strategy is a classic case of PR at its best. McDonald’s listened to the lobbyists and activists who pointed the finger at it. Not just the company, but the CEO as well. It then did what all good PR should do - devised a strategy and action to specifically address the concern. And it did it quickly. Then, led by the CEO who was obviously fully committed, it set about communicating the changes it was making across all levels - led by PR and then followed up by other forms of traditional marketing. The critics will say it’s been a smart marketing move because it’s reportedly given McDonalds its best sales growth for over 20 years. But it didn’t start out that way - it was a risky, bold move. And it’s likely that part of the reason it’s been so successful is because consumers - who are used to all the marketing hype - have seen it as a very genuine move by McDonalds that got huge editorial (and credible) coverage. Of course many other food companies are planning similar initiatives - and some may meet consumer needs better than McDonalds. But McDonalds was first and everyone else’s efforts will always be compared against them - a great position for McDonalds. The verdict on its PR - shows the role and monetary value of PR in the modern marketing mix. It also demonstrates that the best PR is not what you say but what you do. Grant Common This is our last edition for 2003. To our growing list of readers please accept our best wishes for an enjoyable Christmas and holiday period and a successful 2004. We’ll be back in February with our next issue.

PR Influences Australian Public Relations Newsletter. Article: Examples show how Crucial PR is to Corporate Success. Information Content: Opinion & Comment