Posted by Shel Holtz
It was a quiet week, by Strumpette standards, which will make for a blissfully short "Week in Review."
Jack O'Dwyer -- who once was a business reporter focused on corporate financial matters -- showed once again that the only issue of concern to him regarding professional associations is their finances. I'm not a member of PRSA -- never have been -- but I know scads of PRSA members who all believe they derive value from their memberships. (Why else would they keep paying annual dues?)
When I cast a critical eye on PRSA, I see a lack of recognition that the nature of public relations is changing. It was this dearth of programming and research into "new media" that led to the formation of the Society for New Communications Research; if the mainstream communication associations weren't going to provide the case studies and quantitative assessments, they would form an organization and do it themselves. But O'Dwyer rarely focuses on content. (He once proclaimed proudly to have registered over 1 million "hits" to his website without recognizing that there were dozens of distinct files on his home page alone, each of which would account for a separate hit. I've always appreciated Katie Paine's assertion that "hits" is an acronym for "how idiots track success.")
But let's stick, briefly, with finances. Some of O'Dwyer's arguments bother me, notably the ones that are based on vague generalities.
None of which means that I think O'Dwyer is necessarily wrong in his recommendations for changes to PRSA’s accounting practices. I'm no financial wizard -- far from it -- but I do believe in dues deferral. Having been through the painful change to a deferral system with IABC while I was serving on the board of the Los Angeles chapter, I learned enough about it to understand the wisdom in it. That is, I don’t have a problem with O’Dwyer’s recommendations, just some of the arguments he makes in support of them.
Shel Number One
Shel Israel and I have come to an agreement. He's Shel Number One; I'm Shel Number Two. The ranking is age-based, so I have no problem with that.
Strumpette took on Shel Number One when Shel wrote that it was over between him and Amanda. In the course of her response, Amanda reiterated a point she has made countless times in this blog: "The majority of our audience finds our commentary compelling, poignant and often amusing." Okay; fair enough. Now prove it. Have you done a survey? Focus groups? Have you counted the number of comments in which readers use the words "compelling, poignant, and amusing?" I talk to a lot of people who read Strumpette, and most say they tolerate the nonsense in order to glean the occasional nuggets and salient observations. I have yet to speak to anyone who finds unprovoked personal attacks to be "poignant." If there are some who do, I doubt they represent the total readership. So I'm asking: How do you KNOW what "the majority" of the audience thinks? I'm just asking.
Three notes in the Shel Israel post rubbed me the wrong way. First was the notion that spreading word of mouth through MySpace somehow "used and manipulated" readers. I would appreciate some elaboration, since the effort was transparent. Second was the assertion that we "practice in the shadows by definition." And here I thought we practiced PUBLIC relations. Silly me. While it is improper and unethical for public relations representatives to steal the spotlight from their clients (I would never speak for a client; rather, I would counsel the client on how to speak for himself), the vast majority of PR work is performed out in the open. Finally, there's the statement that "We are PR! We do stunts!" Again, public relations is being confused for publicity. Publicity agents do stunts. Public relations practitioners build relationships. Someday that message will break through.
Thanks, Amanda, for pointing us to the Ragan survey. Of course, there have been many surveys of this nature -- including one that just wrapped up from the Society for New Communications Research that was crafted by research experts to ensure results were statistically meaningful. That's not to suggest that Ragan's survey is not, only that the results of any study be viewed in context of other research and how the questions were asked.
I was amused by the video poking fun at Debbie Weil for her assertion in an interview that some CEO's should not blog. The video suggests that this is somehow a 180 for Weil, author of "the Corporate Blogging Book." In fact, Weil's position is entirely consistent with what she wrote, which is readily available in Chapter 5, "Should the CEO Blog?" On the very first page of the chapter, she writes, "If you're too much in the public eye and also happen to be CEO of a public company, it's likely your every word will be parsed for hidden meaning. You'll find it hard to let loose and be truly authentic. your customers, competitors, the press, analysts, investors -- not to mention your employees -- will be searching your blog for inside information and clues to the real story about your company's financial condition or future directions." And that's just one reason she offers for a CEO NOT to blog.
I know Debbie, and I know she takes a strategic view of executive blogging. She does not advocate blogging by everybody at all costs regardless of other factors. She is clear about this in her book. It is disingenuous to suggest otherwise.
Finally, I'm right there with Phil Hall this week. Sometimes it is best to ignore critical commentary in the media, notably (as Phil rightly suggests) when no inaccuracies are involved. I worked for a company long ago that reorganized its operating units. In a game of corporate musical chairs, one senior executive was left without a job. The company issued a statement that employed the usual BS corporate-speak: "John Doe is leaving to pursue other opportunities." The local daily newspaper ran the story on the front page of its business section under the headline, "So long, pal." The headline was prepared (as anyone who has ever dealt with a morning newspaper understands) by a copy editor. It did not reflect the attitude of the staff writer or the publisher. Nevertheless, when I got to work that morning, a call from the company president was waiting for me. "Get the reporter on the phone and tell him we're never going to talk to him or his newspaper again," I was instructed.
Right. The daily metropolitan newspaper covered us because we were a Fortune 500 company in their own backyard, and we were no longer going to be available to respond to their inquiries. Uh huh. Smart move. Bad president. You tell 'em, Phil.
Until next week...
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"Again, public relations is being confused for publicity. Publicity agents do stunts. Public relations practitioners build relationships. Someday that message will break through."
So this stunt would make Edelman publcity agents
To your point John, 90 percent of what we do is publicity related. It is the business' bread and butter.
Couple points for clarification:
- With regard to our audience finding our commentary compelling, poignant and often amusing, and you wondering if we’ve done surveys, focus groups, etc. No, nothing formal. I can only tell you anecdotally the flood of fan mail we get. I can only tell you that our key audience is iconoclasts and those dissatisfied with the current state of the PR business.
- With regard to you hearing from a lot of people who read Strumpette that they tolerate the nonsense in order to glean the occasional nuggets and salient observations... Great! We purposefully try to mix it up. We try to run the gamut between frivolous to deep. I think it somewhat captures my personality. Variety keeps the palate fresh.
- As to you not associating with people who have found our personal attacks "poignant," two things: 1) Remember PR's product/service is “belief.” It is perfectly legitimate to attack those who are using false beliefs for financial gain. That’s why they call them social parasites. And 2) As I said to Shel One, people being so poked never find it “poignant.”
- As to you questioning whether spreading word-of-mouth through MySpace is "using and/or manipulating readers,” again, as we said to Shel One, you need to ask those who were so targeted to be “influenced.” I am confident to say that no one like to be surreptitiously influenced.
- With regard to “practicing PR in the shadows" versus “public” relations, that’s practice versus theory. In theory priests make good baby sitters.
- Lastly, as to PR being confused for publicity… 90 percent of what we do is publicity related. It is why we are hired primarily. It is our bread and butter.
Hi Shel, I appreciate your bringing up PRSA’s finances.
What they’re doing is somewhat like a father who buys an SUV or joins a country club for $50,000 and eliminates the possibility of his daughter going to college.
It’s less about accounting arcana than equitable distribution of funds.
Instead of sending the much-loved, 1,000-page directory of members and other information to all 22,000 members, PRSA elects to lose well over $1 million on its annual conference attended by only four percent of the members. The attendance percentage was provided by 2005 president Judith Phair.
In 2000, when PRSA had lost $678,893 after a loss of $426,288 in 1999, it cancelled for the first time in history publication of the members’ directory. PRSA was technically insolvent, unable to provide a major service.
But this didn’t stop the entire board from taking a four-day trip to London that same year to meet with the Institute of PR. Travel, meals and hotel spending was a record $717,477 in 2000, topping the previous record of $665,692 set in 1990 when revenues were only $5.2M. In other words more than 10% of revenues went for travel, etc., in 1990.
So “leaders” were living high on the hog in 2000 while stiffing the members out of their prized directory. No matter what they say now about online being better, PRSA is not printing its directory simply because it cannot afford to while lavishing perks on the “leaders.”
PRSA’s finances are a shadow of what they used to be. In 1991, if dues payments were counted as cash as PRSA is now doing, net assets were 47% of revenues of $5.2 million. PRSA now says its net assets are 23% of revenues of nearly $12M. But this includes about $2M of dues that are not yet “earned.”
All the other major associations defer about half of dues including IABC, as Shel points out. I estimate PRSA’s real net assets to be about 10% of revenues.
As for CPAs, please notice that almost no one can do their own personal income taxes these days. Income tax laws run to thousands of pages. Small businesses are hit with tens of thousands of CPA fees. Do you think CPAs are our friends? What about all those accounting scandals involving Enron, Worldcom, etc.?
CPA firms address their audits to the boards of clients. In 1991, PRSA and CPA firm Ernst & Young removed 324 dollar statistics from the audit (expenses in 27 categories under 12 headings). PRSA was angered about our reporting of the enormous sum spent on travel, meals and hotels not to mention spending in other categories like accreditation ($249,417).
Member outcry brought back the functional expenses in 1992 but no longer reported were nine types of expenses including board expenses, staff travel and the districts. KPMG in 1992 had recommended abolishing the districts as a waste of about $40,000 a year. This was ignored because about 50 titles are involved.
Net nut: PRSA is a giant pork barrel of goodies for the accredited insiders and their supporters. Most members aren’t upset because about 80% of dues come from employers (PRSA’s own estimate).
The accounting professors I cite include Prof. Edward Ketz of Penn State and Prof. Charles Mulford of Georgia Tech, who are also quoted as experts by the Wall Street Journal. The third one is Phil Wolitzer of Long Island University, who teaches classes for journalists for the New York Society of CPAs. Ketz and Mulford are also noted authors.