4 C H A P T E R Public Relations Departments and Firms

Topics Covered in Chapter 4 Public Relations Departments Public Relations Firms

Public Relations Departments Public relations departments serve various roles and functions within companies and organizations. Executives increasingly see public relations not as publicity and one-way communication, but as a complex and dynamic process of negotiation and compromise with a number of key publics. The role of public relations in an organization often depends on the type of organization, the perceptions of top management, and even the capabilities of the public relations executive. Large, complex organizations have a greater tendency than do smaller firms to include public relations in the policy-making process.

Public Relations Departments cont. Large, complex organizations have a greater tendency than do smaller firms to include public relations in the policy-making process. In such organizations, the authority and power of the public relations department are quite high, and they are a part of the “dominant coalition” and have a great deal of autonomy. In small-scale organizations, staff members act as technicians and have little or no input into management decisions and policy formation.

Public Relations Departments Levels of influence Sources of friction Outsourcing trends Roles Department organization Line versus staff function Access to management

Public Relations Departments cont. Public relations departments go by a variety of names in the corporate world, including: Corporate relations Marketing and corporate affairs Investor relations, public affairs Marketing communications Community relations, External affairs Government agencies, educational institutions, and charitable organizations use terms such as: Public affairs Community relations Public information Marketing services

Public Relations Departments cont. A department usually is divided into specialized sections that have a coordinator or manager. Common sections found in a large corporation are media relations, investor relations, consumer affairs, governmental relations, community relations, marketing communications, and employee communications. Public relations personnel may also be dispersed throughout an organization the marketing department or assigned to the human resources.

Public Relations Departments cont. Traditional management theory divides an organization into line and staff functions. A line manager, can delegate authority, set production goals, hire employees, and directly influence the work of others. Staff people have little or no direct authority, but they 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.

Public Relations Departments cont. Although public relations departments can function only with the approval of top management, there are varying levels of influence that departments may exert. Access to Management The power and influence of a public relations department usually result from access to top management, which uses advice and recommendations to formulate policy. Levels of Management Management experts state that staff functions in an organization operate at various levels of influence and authority.

Public Relations Departments cont. Ideally, public relations is part of the managerial subsystem and contributing to organizational strategy. However, other staff functions also are involved in the communication process with internal and external publics, which can cause friction. The four areas of possible friction are: Legal Human resources Advertising Marketing

Public Relations Departments cont. A major trend for American corporations has been the outsourcing of services. The trend line also is for more organizations to outsource their communication activities to public relations firms and outside contractors. The most frequently outsourced activities are: Writing and communications Media relations Publicity Strategy and planning Event planning

Public Relations Firms cont. Public relations firms or agencies are found in every industrialized nation and most of the developing world. Public relations firms range from one- or two-person operations to global giants with almost 3,000 professionals. Firms provide a variety of services, including: Marketing communications Executive speech training Research and evaluation Crisis communication Media analysis Community relations Events management Public affairs Branding and corporate reputation Financial relations

Public Relations Firms cont. Most major public relations firms generate substantial revenues from international operations. 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. Essentially, firms form affiliations and cooperate with each other to service clients with international needs.

Public Relations Firms cont. Until the 1970s, the largest public relations firms were independently owned by their founders or employee stockholders. Starting in 1973, large public relations firms were purchased by major advertising agencies. Large conglomerates acquire public relations firms for several reasons, including the desire to create integrated communication services and to obtain attractive investments.

Public Relations Firms cont. Advantages to hiring a public relations firm are: Objectivity Variety of skills/expertise Extensive resources International jobs Offices throughout the country Special problem-solving Credibility Drawbacks to hiring a public relations firm are: Superficial grasp of a client’s unique problems Lack of full-time commitment Need for prolonged briefing period Resentment by international staff Need for strong direction by top management Need for full information and confidence Costs

Public Relations Firms cont. A public relations firm charges for its services in several ways. The three most common methods are: Basic hourly fee, plus out-of-pocket expenses Retainer fee Fixed project fee