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'It seems that for too long, even in my general management days, the public relations function was writing speeches for the chairman or answering complaints about products. Twenty years ago I was told that marketing was something you learn as you go along. Public relations is still like that.'
One unwelcome result has been that bright young graduates who wanted to go into public relations have in the past primarily headed for consultancies rather than companies.
Dr Kevin Hawkins, WH. Smith director of corporate affairs, believed that while public relations might creep on to the board under the heading of community affairs or corporate communications, straight public relations directors on the board will be few and far between. Partly, that is, because some companies have relatively small boards, and partly because 'the whole thing has grown so quickly in such a short space of time that there are a lot of people around who quite frankly are not of the right calibre to be main board directors'.
Why companies use consultants
The way that companies choose and use public relations consultancies is changing as never before, as squeezed budgets are accompanied by a deepening understanding of the central role communications plays in securing competitive advantage.
The fact that many of these in-house managers have also had spells in consultancies means that their knowledge of how consultancies operate is rooted in reality. In other words, they take a pretty hard-headed approach, demanding improved understanding of the client business and demonstration of specialist skill, better performance, and more accountability. Some have brought the public relations in-house, dispensing with outside help except on an ad hoc basis. Others increasingly demand that their consultancies accept work and compensation on a project-by-project basis, rather than being kept on a retainer.
According to Graham Lancaster of Biss Lancaster, clients are indeed far more tuned in to how to use PR consultants both because they are more sophisticated and because the recession has forced them to concentrate on getting value for money; and that, he said,
'has forced PR companies to respond accordingly. The recession has forced out some consultancies, either because they were marginal or because of property and other issues and I think we are seeing a leaner, fitter and better consultancy world as a result. I believe the profession is earning its spurs more.'
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Case 3.3 1iY.H. Smith and Abbey National
In 1991 W.H. Smith, a leading retailer, and Abbey National, a building society turned pic, had something in common: both preferred to build up good-sized in-house teams rather than to employ a raft of outside consultancies.
WH. Smith
W.H. Smith had just under 30 public relations staff in its department, which serviced what is a diverse spread of businesses, including retailing of books, magazines, stationery, recorded video and music in the UK. distributing of newspapers, magazines and office supplies and a growing retail business in the USA and on the continent. According to director of corporate affairs Dr Kevin Hawkins. the group used an external agency for government relations:
'Otherwise we are self-sufficient. The company felt there were synergies in having central resources as opposed to fragmenting them around the business units. And I have not been overly impressed with consultancies, who grew so fat in the ]980s that they took on people who might not have got jobs otherwise. '
The public relations function had become established as II more integral part of the business over the last five to six years. It had to prove its worth to - at times - sceptical executives. As Hawkins said:
'In any company where you are growing and developing it is inevitable that some people tune into that wavelength and others take longer. My perception is that over the last two years the subsidiary companies and senior executives have begun to realize what sort of hard contribution good public relations in the widest sense can make to the business. However, one always has to guard against being seen as a high cost overhead away from the coal face.'
The team, most of whom have had experience in external consul. tancies, dealt in a wide range of areas, from the strategic to the tactical. That could mean speaking on issues like the Net Book Agreement or Sunday trading, to devising brand promotions for the individual com panies. They had 10 'clients' in all. A complicating factor was thlll although there is an overall W.H. Smith vision statement, each company retained its own image and philosophy. Nor was the work readily assured: as divisional public relations manager Valerie Hart noted, 'We
continurs