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Copyright © 2015, 2012, 2009 Pearson Education, Inc. All Rights Reserved.

Public Relations: Strategies and Tactics

11th Edition

Dennis L. Wilcox Glen T. Cameron Bryan H. Reber

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Chapter 4

Public Relations Departments and Firms

Chapter 4 Objectives

 Understand the role and functions of a public relations department

 Be more knowledgeable about the staff function of public relations

 Understand the structure of a public relations firm and its various activities

 Know the difference between working in a department and working in a firm

Public Relations Departments

 BEFORE: primary objectives were promotion and publicity

 NOW: complex and dynamic process of negotiation and compromise with a number of key publics

Corporate Structure Shapes the Public Relations Role

 The role of public relations in an organization often depends on  The type of organization  The perceptions of top management  The capabilities of the public relations executive

 The differences between large and complex organizations and small-scale organizations

Having Influence is Based on Four Factors

 Perception of value by top management  Practitioners taking on the managerial

role  Reporting to the CEO  Years of professional experience

Organization of Departments Figure 4.1 IBM’s Organization Chart – Example of how a large, global corporation (with several hundred employees) would be organized Shows the integration of global marketing and communications under senior vice president Jon Iwata – 13 divisions

• IBM Marketing, Communications and Citizenship (December 2009) • Executive Assistant or HR Partner - Jon Iwata, SVP, Marketing, Communications and Citizenship

• VP External Relations • VP Client Executive Marketing • VP Market Insights • VP Corporate Marketing • VP Citizenship and Corporate Affairs • VP Strategic and Executive Communications • VP Brand Systems and Workforce Communication • VP Operations • Business Units

• VP Marketing and Communications, Global Technology Services • VP Marketing and Communications, Software Group • VP Marketing and Communications, Systems and Technology Group • VP Marketing and Communications, Global Business Services • VP Marketing and Communications, Sales and Distribution

• Geography Units • Country Communications Leaders • Country Marketing Leaders

Organization of Departments, cont’d.

 Majority of companies are smaller and employ fewer staff in public relations area

 PRSA and Bacon’s Information, Inc. study of the number of individuals employed in public relations departments found 13% had departments with 10 employees 45% had departments with 2-5 employees

 The issue of decentralization of public relations employees

Public Relations as Staff Functions

 Traditional management theory divides an organization into line and staff functions

 Line managers  Can delegate authority  Set production goals  Hire employees  Directly influence the work of others

 Staff  Have little or no direct authority  Indirectly influence the work through suggestions,

recommendations, and advice  Although public relations departments can function only

with the approval of top management, there are varying levels of influence that departments may exert

Levels of Influence

Copyright © 2015, 2012, 2009 Pearson Education, Inc. All Rights Reserved.

Cooperation with Other Staff Functions

 Ideally, public relations is part of managerial subsystem and contributing to organizational strategy

 Other staff functions are required in the communication process with internal and external publics

 Requires cooperation to avoid possible friction with  Legal  Human resources  Advertising  Marketing

The Trend Toward Outsourcing  Fortune 500 companies now spend 25% of public

relations budgets on outside firms  Companies of all sizes spend more than 40% of their

public relations budget on services from outside firms  Brings expertise and resources that cannot be found

internally  The most frequently outsourced activities are

 Writing and communications  Media relations  Publicity  Strategy and planning  Event planning

Public Relations Firms  Predicted to grow as more countries adopt free-market

economies and Internet applications continue to expand  Services provided by firms

 Marketing communications  Executive speech training  Research and evaluation  Crisis communication  Media analysis  Community relations  Events management  Public affairs  Branding and corporate reputation  Financial relations

Creative Edge transcends geographies, drives innovations, has a singular impact on customers and stakeholders and optimizes resources in a global economy

Global Reach

 Most major public relations firms generate substantial revenues from international clients

 International work isn’t only for large firms Small and medium-sized firms around the

world have formed working partnerships with each other to serve client needs Firms form affiliations and cooperate with

each other to service clients with international needs

The Rise of Communication Conglomerates

 60% of the global business in public relations is conducted by firms owned by holding companies

 4 major holding companies WPP Group Omnicom Publicis Groupe Interpublic Group

How Public Relations Firms Get Business

 Organizations will hire public relations firms

For supplemental staffing Help with special projects Specific expertise

Pros and Cons of Using a Public Relations Firm

PROS  Objectivity  Variety of skills/expertise  Extensive resources  Offices throughout the country  Special problem-solving skills  Credibility

CONS  Superficial grasp of a client’s

unique problems  Lack of full-time commitment  Need for prolonged briefing

period  Resentment by internal staff  Need for strong direction by

top management  Need for full information and

confidence  Costs

Fees and Charges

 A public relations firm charges for its services in several ways Basic hourly fee, plus out-of-pocket expenses Retainer fee Fixed project fee