Let’s suppose, for a moment, that you are the head of Communications for a division of a large, publicly held company headquartered on the East Coast. Your employer consistently ranks at or near the bottom of both the J.D. Power and University of Michigan ACSI customer satisfaction studies. Your industry is increasingly competitive and opportunities to tell your stories through traditional media are constantly shrinking. What move do you make entering 2010? Dump all of your local PR firms?
It sounds too ridiculous to be true, but that’s exactly what one executive did, with the company’s blessing, heading into this new year. This division’s communications department terminated its local agencies, including those in some of the company’s (and the nation’s) largest markets. Instead, it will rely solely on its relatively small and geographically far-flung in-house staff.
So will this in-house staff, stripped of its largest set of resources, be equipped with the latest communications tools? Hardly. The mandate from the inside is right out of the PR Stone Age – more press releases, press conferences and “lunches with beat reporters.” I wish I was making this up.
What’s the issue? Normally, it’s money or a cultural reticence to work with outside firms. But not here. The company reportedly spent more than $4 million on Washington, DC lobbying firms alone in the first three quarters of 2009. Another newspaper story reports that the company used an 800-attorney New York law firm to handle a recent deal. We’re told that firm’s lawyers bill anywhere from $500-$1100 per hour. The report listed more than a half dozen partners who worked on the case.
After analyzing this situation, the answer is simple. This company just doesn’t care very much about communicating with its customers or the communities where it does business. That simply isn’t much of a priority anymore. The company makes this decision at its own peril. It’s an established fact that the most successful business-to-consumer companies are those that communicate best.
It’s certainly bad news for the agencies who have lost their contracts, even though they have performed well under challenging circumstances. But it’s worse news for the in-house staff now asked to do their jobs with far fewer resources and unrealistic expectations. The agencies can replace the revenue. But the in-house employees are stuck working for a company that no longer appreciates what they do for a living.