Public Relations

What Were They Thinking?


Good bad chouceThe question was posed in the headline of a New York Times editorial.  It concerned Volkswagen, accused of rigging auto software to manipulate emission readings and evade regulatory limits.

But it could have just as easily applied to the CEO of Turing Pharmaceuticals who bought the rights to a drug used to treat a rare but life-threatening infection and promptly jacked the price up from $13.50 a pill to $750.

It could even have applied to Ben Carson, neurosurgeon-turned-presidential-candidate, who said Muslims aren't fit to seek the office.

Carson sought shelter in the current campaign against "political correctness." The ostensible concern, explains the New Yorker's Jelani Cobb, "is that the parameters of polite (or at least non-bigoted) discussion get in the way of truth-telling, leaving us with good feelings and palliative falsehoods."

Of course, as Cobb also points out, there is no necessary relationship between truthfulness and offensiveness. One does not naturally flow from the other. A lot of what passes for political correctness -- e.g., using gender neutral sentence construction, avoiding racist and homophobic slurs, etc. -- is actually an effort to conform our language to more enlightened ethics. Carson's offense was not failing to respect political correctness, but engaging in religious bigotry. 

Similarly, Volkswagen and Turing's behavior represent ethical failures. Some will argue that Turing was simply attempting to price its drug to what the market will bear. The "market" reacted and now the company will adjust. That's how capitalism works.

It will be harder for Volkswagen to cloak itself in the principles of the free market. Even Milton Friedman, outspoken apologist for capitalism, cautioned that, in the pursuit of "shareowner value," companies had to "follow the rules of the road." 

Unfortunately, the only limit most companies put on trying to shape those rules is what they can get away with. And it isn't a long leap from that to trying to circumvent the rules entirely. Especially if you think your basic purpose -- or reason for being -- is to generate profits.

That, alas, is what the people at Volkswagen and Turing who were ultimately responsible for this behavior were thinking. But they misunderstood their purpose. Sure it's to create value, but not just for the people who own the company. They also need to create value for everyone who contributes to their company's successes and bears the risk of its failures.  

That is a company's true ethical purpose. And that's what should guide every capitalist's thinking.

 

 

 

 

 


Web journalism arrives

Journalism.001The Internet ran over journalism. And a lot of people are just waiting for the victim to stop twitching so they can bury it. 

There are plenty of reasons to despair that it was a hit-and-run. Advertising and readers fled print media to go online. Traditional newrooms emptying or shutting down completely. PR people now outnumber reporters 5 to 1 and make 40% more.

Worse, most of what runs on the leading "news" websites are repurposed stories from the remaining legacy media. Endless "listicles" seem to be the web's most signifiant contribution to the trade. Otherwise, partisanship reigns in online echo chambers of conspiracy hounds and smear mongers. Elsewhere the newsweb exhbits a weird fascination with cute pets, ordinary people being stupid, and celebrities behaving badly.

But now a ray of hope has emerged from that dark cloud -- a one-man story factory named Steven Brill partnered with Huffington Post on invesigative journalism worthy of the likes of Upton Sinclair and Seymour Hersh at their best.

 "America's Most Admired Lawbreaker" is a 15-part narrative about Johnson & Johnson's marketing of the anti-psychotic drug Risperdal for "off-label" ailments like dementia in the elderly and autism in children. 

Brill is a lawyer-turned journalist-turned entrepreneur who founded American Lawyer magazine in  1979 and Court TV in 1989. After that, he turned his attention to other ventures, some of which failed (e.g., Brill's Content) and some of which succeeded (e.g., Journalism Online, sold to R. R. Donnelly for $45 million in 2011). Inbetween, he has written book-length invesigations into everything from America's public schools to its healthcare system.

Brill can type faster than most of us can write. His output is prodigious and its quality is first-rate. When he dives into a subject, he descends to the depths of an unmanned submarine and he turns over rocks embedded in the seabed for millennia.  

I should add here that I have no idea if the accusations he makes about J&J are accurate. But I should also note that the company has settled federal, state, and private suits over its marketing of Risperdal to the tune of more than $2.5 billion. 

But what's remarkable about Brill's story is not only its length, but the way it exploits all the capabilities of the web. This story was carefully constructed with sidebar links to videos, trial transcripts, depositions, and other primary source material that expands on the narrative and gives readers an opportunity to make their own judgments.

It's a devestating chronicle, exactly the opposite of shoveling content online. And an example of what web journalism may one day be. It also represents both a challenge and an opportunity for public relations practitioners. 

The opportunity of course is to use the same techniques to tell an organization's own story. The challenge is what to do when someone else uses them to tell a story about you.

J&J alas may be a case study of the latter. And every public relations practitioner should read and view "America's Most Admired Lawbreaker," not for schandenfreud's sake but as an object lesson in the power of new media.

 

 

 


Beth Comstock

Comstockgreyseat-2The big danger in writing a book that profiles leaders in any field is that they won't be in their current position by the time the book comes out. That's especially true in marketing where the lifespan of the typical CMO is about the same as a fruit fly's.

So I started writing Secrets of the Marketing Masters with some trepidation. Sure enough, by the time the book was published, only one of the six marketers I profiled was still on the job. 

But my book's lonely exception proved my contention that marketing is not about downstream functions like sales or advertising but about satisfying customers' upstream needs, values, and aspirations. It's less about selling something than figuring out what customers need and how to provide it.

Beth Comstock had just become GE's chief marketing officer when I interviewed her more than a decade ago. And that was clearly her philosophy, not only in rhetoric but in practice.

She's not only still at the company, she was just appointed one of four vice chairs reporting to CEO Jeff Immelt.  She's still CMO, but her responsibilities have been broadened to include the entire purview of "Business Innovation." 

This excerpt from Secrets of the Marketing Masters helps explain how it came to be:

In a company with fabled bench strength, [GE CEO Jeff Immelt] made his top public relations executive the company’s first chief marketing officer since Welch had abolished the position 20 years before.  Immelt charged her with driving innovation throughout the company’s ranks. 

At first, her appointment as CMO had people outside the company, as well as some GE lifers, scratching their heads.  The fast-talking 42 year-old had begun her career covering the Virginia state legislature for a local news service, and later moved to GE's NBC, working in media relations in Washington and New York. ... By 1996, Ms. Comstock was NBC's chief spokeswoman, before becoming senior VP-NBC corporate communications. ... About two years later, in August of 1998, perhaps thinking about the imminent launch of his successor, Welch appointed her the company’s vice president of corporate communications.

An autodidact throughout her career, when Immelt broadened Comstock’s responsibilities to include marketing, she gave herself 90 days to figure out what she was supposed to do. She studied best practices at companies from Procter & Gamble to FedEx and 3M. She brought in a raft of marketing gurus and peppered them with questions.  And most importantly, she spent time with the company’s business leaders.

GE’s structure was the other reason people wondered why the company needed a chief marketing officer. Each of the conglomerate’s divisions handled its own marketing and was fiercely independent. Their mantra was “if you tell me what to do, you can also take responsibility for my numbers.”  That’s what had led Welch to eliminate the position in the first place. What would a chief marketing officer do at GE, other than preside over quarterly show-and-tell sessions that led nowhere?  

But Immelt had a little more than that in mind. ... In the fall of 2003, Immelt emerged from a series of long-range strategy sessions with his division leaders and told Comstock he was struck how often the environment and climate change came up in their discussions of emerging trends that would impact their businesses over the next five to ten years.  “I think there’s something there,” he told her, but I don’t know what. See what you can do with it.” 

To Comstock, taking on environmental issues seemed like a big leap for a company that had spent much of the previous decade refusing to excavate toxic chemicals it had dumped into the Hudson River (which was legal when GE did it).  What was widely perceived as the company’s “arrogance” had made it one of the environmental movement’s favorite targets.    

But she dutifully began an 18-month investigation of the issue, bringing in some of GE’s biggest customers for what she billed as “discovery sessions” with the company’s top leaders. In the course of the two-day sessions, 35 customers at a time, in industries such as energy, aviation or water debated market and technology trends with senior GE executives, including Immelt.  In effect, they were asked to imagine life in 2015—and the products they would need from GE.

Comstock and the other GE executives took away a clear message: rising fuel costs, ever tighter environmental regulations and growing consumer expectations will translate into demand for cleaner technologies across all of the company’s infrastructure businesses, which represented nearly 90 percent of revenue. ...

The company’s “ecomagination” campaign grew out of these sessions.  But Comstock hesitated to move too quickly.  Instead she began a year long “listening tour” among employees, customers, investors, activists and public officials. The basic idea had come from customers, but they cautioned the company not to get too far ahead of them, especially in talking to public officials.  Not too surprisingly, the other constituencies were all somewhat skeptical, especially the company’s own employees. 

“Our internal audience was the toughest,” Comstock remembers.  “They were worried it was just a PR campaign, that it wasn’t real. Some doubted we could deliver.  And they were all aware of the company’s very public battle to keep from removing PCBs from the Hudson River.”  To Comstock, this was a make or break issue.  “If employees don’t buy in, customers won’t either,” she says. “Marketing is all about culture — internally and externally. You can’t create something that sticks unless you get into the culture.” 

Skepticism was not limited to lunchbox toting rank-and-file employees.  Immelt told Vanity Fair magazine that by his count eight out of ten of the company’s senior executives “were against the plan” when they first heard about it in December of 2004. Comstock remembers the boardroom presentation as an audience of frowns that got deeper with every PowerPoint slide.  Over the following months, Immelt and Comstock laid out the argument for the program.  The company had already invested in it – as the number one producer of power-plant equipment, airplane engines and locomotives, it had little choice. 

Years of R&D had already given it the most efficient large-scale energy technologies on the market.  ... With the exception of the Hudson River controversy, GE actually has a good record on environmental performance.  Yale University's Center for Environmental Law and Policy gave the company plaudits for setting high standards and for holding managers accountable for meeting them. Finally, clean energy was vital in the overseas markets GE had already targeted for 60 percent of its growth and where major customers were subject to the Kyoto Protocol. 

Immelt summed up his pitch in a slogan that may have sealed the deal internally, as well as among other skeptical constituencies – “Green is green,” he says.  One thing GE employees do understand is the company’s relentless focus on revenue and profit.  “Ecomagination” was not being adopted because it was trendy, or even the moral thing to do.  It was about making money by giving customers what they need.

Immelt himself launched the “ecomagination” campaign in mid-2005, repeating his “green is green” slogan during simultaneous news conferences in Washington, DC, Brussels and Tokyo. Comstock says it resonated even more powerfully than she expected.  There were a few critics who sniffed “greenwash,” but by and large the environmental community took a wait and see attitude.  Immelt’s decision to negotiate an agreement with the Environmental Protection Agency to clean up the Hudson River obviously contributed to the cease-fire. 

But the campaign also rang true to most people.  The case histories were modest and believable.  GE salespeople were armed with “score-cards” that told customers in dollars and cents exactly what the lower emissions and higher fuel efficiency of a new GE product meant to them in fuel savings. And, in typical GE fashion, the company integrated the campaign into its business processes ... with targets and metrics to track progress.  Overall, GE set a very public goal to increase revenue from clean energy products from about $10 billion in 2005 to $20 billion in 2010. 

GE beat that goal. By the middle of 2014, the Harvard Business Review was able to declare, "The company has reaped $160 billion from the program since 2005. These revenues grew twice as fast as total company sales, providing a critical crutch in the post-financial-meltdown years (GE gets about half its business from financial services)."

And that is why Beth Comstock was made vice chair of GE. 

By the way, Secrets of the Marketing Masters was just published in Mandarin. Somewhere in China some young marketer is looking at Beth Comstock as a model to imitate. Not a bad idea for us all. 

 

 


Trumped

TrumpPoor Jeb Bush. As if his last name were not enough of a millstone, he has to put up with advice like the following from a so-called "image expert," as conveyed by the Wall Street Journal's "Think Tank."

To win the White House, Jeb should: 

  1. Dress for success. Wear a crisp shirt and nice tie.
  2. Ditch the glasses. Wear contacts.
  3. Set the stage.  Make sure you have the right backdrop.
  4. Use pre-packaged sound bites. Don't wing it.
  5. Get a better slogan. "Right to Rise" isn't working.
  6. Be more fun, like The Donald.

Well, think again.

I can understand why Republican candidates are frustrated. They're being Trumped by the P. T. Barnum of real estate developers turned reality TV star turned political candidate. And according to some political analysts, while his lead may be over-stated, it looks like he'll be around for a while. 

But beating Trump will require more than slicker packaging. The guy's speeches are incoherent, his policies no more sophisticated than the guy's on the next barstool, and his hair is a joke. Still, he's ahead. 

Why?

In marketing terms, I think it's because professional Republicans and Democrats have wrecked their category. They've given politics an even worse reputation than it had. Something Will Rogers would have thought impossible.

Everyone knows political polarization hasn't been this bad since the Civil War. The inevitable consequence is less well understood.  

In a 2012 Pew Research study, 76% of Americans agreed: “it’s time for Washington politicians to step aside and make room for new leaders.” And Republicans are even more likely than Democrats or Independents to want new leaders, "even if they're less effective than experienced politicians."

Well, Trump certainly appears to qualify.

His competitors, including Jeb Bush, need to figure out how to tap into voters' anger about politics as usual without appearing to be, well, politicians. 

 

 

 


Unlocking minds

Closed mindNothing is harder to change than a made-up mind. We're hard-wired to protect our pre-existing attitudes and beliefs by ignoring data that contradict them and paying more attention to those that agree. We like people of like mind and, by and large, that's who we hang out with, online and in the real world. We wear our opinions like a badge.

In fact, strong opinions carry strong feelings.  Back in the 1920s, columnist Walter Lippmann observed “Opinions are not in continual and pungent contact with the facts they profess to treat.  But the feelings attached to those opinions can be even more intense than the original ideas that provoked them.” Attack my opinion about something like the dangers of childhood vaccination and you're attacking me. Not to mention my kids.

Now it turns out those feelings may be the trap door through which opinions can be affected.  A recent study shows it's more effective to appeal to oponents of childhood vaccination through their emotions, by showing them photos of children sick with measles, mumps or meningistis. A New York Times writer calls this "a reminder that subjective feelings are still trusted over scientific expertise." 

Come to think of it, politicians seem to have tumbled to this many elections ago, as demonstrated by the current leader in the GOP primaries. Maybe it's time for companies to pay more attention to it.

 

 


Like a girl

Bic adEveryone knows sexism is wrong. Yet company after company stumbles into situations like the ads Bic posted on Facebook and then took down in the heat of a subsequent firestorm.

Is it because sexism is a matter of taste and highly subjective?  Or is it because, like many ethical issues, few people understand the principles by which to judge something right or wrong, good or bad? 

Make no mistake: sexism is an ethical issue, not simply a question of taste or manners.

Bic's ad is sexist because it's built on a demeaning series of stereotypes - literally de-meaning because they rob women of what it means to be female. It denies their full human possibilities.  It essentially says that to succeed women have to dress and act like pretty girls, while hiding the fact that they can think and work like men.  

That violates the three major ethical theories of virtue, duty, and consequences. Not to mention contemporary feminist ethics. It is uncaring, unjust, and obnoxious.

Like a girlAt the other end of the spectrum are ads promoting Always feminine hygiene products.

I have no inside information on the thinking behind the Always campaign, but I suspect it wasn't entirely idealistic.

Always' marketing team probably despaired of convincing women to switch away from the brand they had been using since puberty. So they chose to focus on their daughters and selected a message that would resonate with both -- girls can do anything, and they shouldn't let anyone put them down by saying they throw, run, or do anything "like a girl."

It's great branding. And ethically, it was a home run.  

 

 

 


Deja vu all over again

CokeOne of the cases in my new book about public relations ethics concerns the tobacco industry's 20-year effort to sow doubt about the dangers of smoking. It was a diabolically clever campaign dreamed up by the Hill & Knowlton PR firm back in the 1950s.

The idea was to create a scientific-sounding group with two goals: first, to raise questions about research linking cigarettes with cancer and heart disease and second, to find and publicize other causes such as pollution, bad diets, and genetics.

The Wall Street Journal called it "the longest-running disinformation campaign in U.S. business history." 

I included this case with some trepidation because it happened so long ago. Apparently, that concern was unwarranted because just this week the technique resurfaced on behalf of a new industry: soft drinks.

Coca-Cola  is sponsoring the "Global Energy Balance Network" to suggest exercise -- not cutting calories -- is the best way to control obesity. 

Faced with declining sales, Coke -- like the tobacco companies before it -- is trying to sow doubt about the major contribution surgary soft drinks make to obesity, heart disease, and diabetes. 

It's the 1950s all over again.


What Brian should have said

130212-Williams-Brian-2010-teaseNot to pile on, but you'd think with five months to think about it, Brian Williams would have been better prepared for his inevitable apology tour. Based on his interview with Matt Lauer, it will probably be a one-stop event.

The New York Times was just one among a host of the un-impressed, noting the verbal gymnastics Williams used to avoid uttering the "L word" -- I lied.  Instead, he repeatedlty admitted, "I didn't tell the truth" as if his transgression was one of ommission, withholding facts rather than saying falsehoods.

I understand. For a journalist to admit he lied is second in seriousness only to plagiarism (another form of lying). But as my colleague and friend Mike Paul noted, "“There are no ifs or buts in a true apology.” What Williams attempted was a "non-apology apology.”

So should he admit he lied? Yes, but he should put it in context.

"Yes, I'm ashamed to admit it, but I lied. The helicopter story started with small exaggerations that grew larger in repeated telling until I reached the point that I actually believed what I was saying. So in that sense I wasn't trying to mislead people; I was trying to entertain them and, deep down, trying to make myself look more heroic. But what I said wasn't true.  It was a lie.

"If anything good can come of this, it's that I now understand myself better, I know I've lost the trust of many colleagues, I've embarrassed a news organization I love, as well as my family, and I've given the public another reason not to trust the media.  For all that, I'm deeply sorry and I sincerely appreciate the opportunity I've been given to regain the public's trust."

That, I think, would have been a real apology. And from all that I have read and seen, is much closer to the real truth. 

 

 


The Pope & Adam Smith

Pope2650Some are interpreting Pope Francis's encyclical on the environment as an attack on capitalism, prompting one presidential candidate to say he'll look elsewhere for economic advice. 

Senior public relations counselors can't be as dismissive of the pope's message, which goes to the very purpose of a corporation.

If one believes that a corporation's only purpose is to create wealth (value) for its shareowners, then its environmental impact is simply an "externality" that need only be addressed to the extent required by law and regulation. And it's perfectly free to do anything legal to shape those laws and regulations to its advantage. 

If on the other hand one believes a corporation's purpose is to create wealth (value) for everyone who contributes to its success and bears the cost of its failures, those "externalities" have moral significance. Corporations need first to ask themselves what they can do to minimize the environmental impact of their operations. And then they need to ask what they can do within their areas of competence to deal with the broader impacts on their stakeholders. 

Public relations counselors should recognize that a significant portion of the public are embracing the pope's message. That's not a call for more green-washing. But for a thoughtful discussion of the underlying question: what is the purpose of the corporation?

Adam Smith, the guy who essentially invented capitalism, was first a moral philosopher. He wouldn't have been so quick to suggest the pope should stick to his rosary. In fact, he would have seen the pope's encyclical as the continuation of a discussion Smith himself started. 

 

 


How to wreck a reputation

Broken-telephoneThe Federal Communications Commission said it plans to fine AT&T $100 million for capping the speed on data plans it advertised as "unlimited." 

I have no insight into how AT&T is managed these days, But when I ran public relations for the company, we had constant battles with line management about the announcement of price increases and other customer-affecting moves.

We in public relations wanted to issue a news release explaining any increase; line management thought it was sufficient to mention it in mice-type legal ads. 

Luckily, for most of my tenure at AT&T, there was another player in this mix -- the company's CEO, who could see further than the next quarter's earnings report.  Unfortunately, times -- and CEOs -- change. One incident late in my career points this up.

AT&T's most profitable business -- consumer long distance service -- was in steep decline, thanks to increases in wireless usage, the dot.com bust, and a major competitor cooking its books to price below cost. The guys running the business were under incredible pressure.

So I was surprised when they reported a profit spike in one of their monthly reports halfway through the year, especially since it seemed to stem from a significant increase in operator-assisted calls.  I asked what accounted for it and was told they had started charging an extra $10 if customers asked an operator to complete a call. 

I said I was amazed that, in this day and age, so many people needed an operator to help to make a long distance call.  Well, sometimes people's calls don't go through because they misdial to a non-existent number, I was told.  If they call the operator for help, she connects the call but adds $9.99 to whatever the final bill is. (In those days, nearly all operators were women.)

“But surely she tells the customer there’s an extra fee involved,” I said.  The guy at the overhead projector grew Little Orphan Annie eyes.  “Well, yes,” he said.  “But she doesn’t say how much unless asked.” 

Our new CEO -- brought in from outside the industry -- sat quietly through the ensuing argument until someone mentioned that the revenue from the extra charge was baked into the unit’s profit forecast.  “In that case,” he said, “change the policy on January 1.  Next subject.”  

Fifteen years and three CEOs later, the subject is data throttling, and the object under discussion is a $100 million fine.  That's a lot of money, even for AT&T. But even if the company successfully challenges the fine, it will pale in comparison to the billions it saved by slowing down data usage on its "unlimited" plans. So in dollars and cents terms, this is probably a no-brainer for today's modern manager.

But in the long-run, it could be a disaster for the company's reputation. 

 


Emailgate: PR lesson of the day

EmailMy email were subpoenaed after I retired. It wasn't a big deal because all those messages were on an AT&T server, and a paralegal simply searched for key words relevant to the subpoena.

I pitty the poor lawyer who had to read them all, especially since I suspect every senior officer in the company had received the same subpoena.  It must have amounted to terabytes of data and reams of paper or, more likely, hundreds of CDs.

In the end, exactly one of my emails drew the interest of opposing counsel, and I had to spend some time in deposition explaining it, including the early hour at which it was written which seemed to arouse their suspicion (or maybe it was sheer incredulity).

So I can sympathize with Hillary Clinton. No one likes having their email published for the world to see. Much less explain any of it. 

But surely she anticipated this eventuality, especially given the Benghazi investigations, which incredibly persist to this day and will probably drag on through the first term of her presidency should she run and win.

Which brings us to the first PR lesson for today: hope for the best but plan for the worse.

Back in 2008, when she was asked what email handle she wanted, she should not have asked herself, "What would look best to my friends?" but "How will my enemies react to this?"

"Clintonemail.com" probably looked clever back then, but you'd think someone who lived through Whitewater, Monica Lewinsky, and mysteriously appearing law firm billing records would realize many of the family's enemies (and even some friends) suspected her and her husband of occasionally hiding things.

The corrolary lesson: Find someone you trust to look at what you're doing as skeptically as your worse enemy. The sharp focus that made you successful can also narrow your peripheral vision.  

 

 

 


De-meaning ISIS

IsisiPublic relations is all about creating meaning. If not done well, everything that follows is wasted. The same might be said of modern warfare.  

No less an authority than al-Qaeda's Ayman al-Zawahiri made that clear. “We are in a battle," he said, "and more than half of this battle is taking place in the battlefield of the media.” So far, in that battle against ISIS, the West seems to be losing.

One key problem is that ISIS's narrative seems to be confirmed on the ground in Syria and Iraq -- Sunni Muslims are being persecuted for their religion. As Simon Cottee points out in an Atlantic essay, nothing we do or say will matter much until that changes.  In the meantime, the best the West can do is play messaging whack-a-mole, responding to every Tweet and blog post ISIS fanboys put on the web.

But that's only part of the problem. ISIS, like al-Qaeda, the Taliban, Boko Haram, and al-Shabaab, is a bigoted and midieval religious ideology. And as Turkish political analyst Ceylan Ozbudak points out in Al Arabiya, "Counter-ideological work means a battle of ideas, not weapons." Since ISIS's ideas are a perversion of Islam, they must be addressed by the Islamic community itself. 

While calling  members of ISIS "radical Islamists" seems to reflect this understanding, it risks backfiring by unintentionally encouraging Islamophobia. As both presidents Bush and Obama have stressed, we are not at war with Islam. The problem we face is not the imposition of Sharia law by growing Muslim populations. It is the spread of a midieval and corrupt version of Islam. 

Better to call members of ISIS what they are -- "violent extremists" -- and to help the majority of Muslim leaders reclaim their great religion.  

To be sure, ISIS's extremist narrative must be challenged wherever it appears, whether websites, social media, university campuses, mosques, or prisons. But those who do the challenging must be credible religious leaders and scholars, backed up by the Muslim faithful. Some Muslim leaders have already spoken up against ISIS in revulsion to its execution of its Jordanian prisoner. But they need to do more to counter ISIS's corrupt religious ideology. 

That task will prove even more difficult -- and probably take longer -- than any effort to regain territory now claimed by the so-called "Islamic caliphate." Islam has no central authority that can "excommunicate" members of ISIS. The Quran, like the Bible, has many contradictory passages ripe for cherry-picking by ISIS.  The history of Islam, like the history of Christianity, is rife with precedents of horrifying brutality in the name of religion. 

Non-Muslims can't tell Muslims how to practice their religion. But we can support -- and perhaps even encourage -- that debate within their own ranks. And we can help Muslim leaders and civil society address the social problems that make ISIS seem like a realistic alternative to some of their youth.

Those actions will be the most meaningful messages we can send.

 

 


Department of what to do with lemons

LemondaeRudy Giuliani may have hijacked Scott Walker's fundraiser with his reflections on President Obama's love life (at least as it applies to the country and its occupants), but the governor's staff has found a way to use it as a springboard for what really matters to them. Here's an email they sent to potential supporters:

"Governor Scott Walker ... refuses to be distracted by the small, petty, and pale ideas that the 'gotcha' headline writers for the Liberal Media want to talk about. ... Now is the time to stand up against the publicity hounds and the journalistic pack, and help Governor Walker fight back with a 'Friends of Scott Walker' contribution ... Your support will show the clueless and mindless journalistic herd that you know what matters most and that it is not the pointless minutiae that they are pushing.”

They may be making fund-raising lemonade out of lemons, but they also have a valid point. From the Sunday talk shows to the evening news campaign coverage and the left- and right-wing blather on MSNBC and Fox, political reporting seems fixated on what historian Daniel Boorstin called pseudo-events.  

Boorstin coined the term to describe events like photo-ops that exist only to generate publicity. Candidates created such events to further their own purposes without the distraction and risk of discussing actual issues. TV journalists went along because it played to their bias for pictures and the illusion of drama.

Now it seems all the media have so thoroughly embraced the concept they are creating their own pseudo-events, posing questions designed to create headlines rather than understanding, fanning controversy when it fails to ignite, and focusing on the embarrassing more than on the enlightening. Online and off, click-bait rules. 

The ethical question for media and PR people alike: do this pseudo-communication respect the electorate's right to make rational choices? Or does it lead to pseudo-candidates and, worse, decisions based on pseudo-qualifications? Are we condemned to live in a social and political hyperreality?

 


Steampunk PR

Steampunk computerIf public relations were numbered like new software releases, we'd probably be in double-digits now, with lots of numbers to the right of the decimal.

But if its mechanics have changed, the practice itself is still decidedly Victorian. 

When I retired 12 years ago, Twitter, Facebook, and YouTube had not yet emerged from the fevered brows of their 20-something founders.

Back then, blogs were the shiny new thing and companies like mine were still trying to figure out how to use them. Shoveling content online was the usual standard. But it turned out consumers had shovels too. User-generated content became a threat for those who ignored it, an opportunity for those who joined the converation. 

These days, according to PR Week, a PR organization might be responsible for: "corporate communications and reputation, media relations, marquee event support, brand publishing, corporate social media engagement and content syndication, corporate sponsored and promoted content, branded media content partnerships, data insights, and analysis." 

Here's what I find instructive about this job description:

"Reputation" is still at the top of the list.  But too few brands realize reputation depends on more than "communications."

"Media relations" follows closely. It's traditionally been the one function no other organization tried to claim for itself, but lobbying and marketing have lately set up their own shadow operations. Smart companies guard its independence and report it to a level that has easy access to the CEO.

"Marquee event support" is a fancy way of saying "publicity" or worse, "party planning." PR may have outgrown those tasks, but it has not outlived them. Done intelligently, they're useful functions but they shouldn't define the practice. In too many places, they do.

The last listed functions -- "data insights and analysis" -- are arguably foundational. PR counsel must be based on more than political correctness and risk avoidance. It requires deep stakeholder understanding. The good news: every company is awash in stakeholder data. The bad news: PR people aren't very good swimmers, let alone pearl divers. The most valuable stakeholder data is numerical; many PR people wear innumeracy like a badge. 

All the other functions -- "brand publishing, corporate social media engagement and content syndication, corporate sponsored and promoted content, branded media content partnerships" -- are variations on a theme that began with the aforementioned blogs. And they have the same self-reverential pitfall. 

As long as "content" or "engagement" is useful to consumers, they will consider it a welcome service. But when the brand itself is primary beneficiary, it's as intrusive as someone taking selfies in the middle of an intimate conversation. And even less welcome. Worse, when it's a promotional message disguised as editorial content, it's akin to fraud, a form of lying tantamount to theft.

PR's shiny new tools may have changed more in the last 12 years than in the last 120, but the principle of respecting and serving stakeholders endures.

 


You know you're in trouble when...

Post cover williams

You kind of apologize that you "mis-remembered" what happened, sending thousands to their dictionaries.

The New York Post's cover shows you with a Pinnochio nose and capitalizes on your name's alliteration with "lyin'."

The New York Times puts its Day Two story about your problems on its front page, above the fold, with nearly a full-page after the jump.  Then it produces a video detailing exactly how your "story has changed."

Rumors force your predecessor in the job to issue a statement that he has not called for you to be fired.

A PR trade publication starts an online survey asking if your apology worked. (The answer is two-to one that it didn't.) Uninvited PR advice is sure to follow.  See below.

Your employer leaks word that it has started "an investigation," practically guaranteeing there will be Day Three and Four stories.

At this point, all you need to do to tighten the lid on your coffin is hire some high-priced PR counsel. Sadly, the best advice you'll get is the hardest to follow because it doesn't guarantee a soft landing and it may even be too late -- tell the truth, apologize, and give something back to demonstrate your contrition.  

You can try something like: "I exaggerated what happened to make it sound more exciting and myself more brave. I'm sorry. I'm making a sizable donation to Wounded Warrior Family Support. It serves the men and women who really faced the kinds of dangers I lied about.  It won't change or excuse what I did, but it's the least I can do to express my profound regret."

 


Oppo research

OppoWriting a book on PR ethics means I've been posting far less regularly and spending lots more time reading the trade press in search of illustrations of ethical dilemmas in the practice of public relations.

Today, I ran across two, which prompts this posting.  

Edelman is accused of using opposition research in promoting the interests of its TransCanada client, the company behind the controversial Keystone XL pipeline.

It seems TransCanada not only faces opposition from American environmentalists who don't want the pipeline going south from Alberta through the U.S. to refineries in Louisiana, but also from Canadians who don't want the pipeline heading east to refineries in Eastern Canada.

Based on documents released by Greenpeace, Edelman proposed to conduct "detailed background research on key opposition groups," a step the New York Times characterized as part of an effort "to spread any unflattering findings about the opposition."  The plan documents also propose enlisting third party allies to "put pressure" on the pipeline's opponents "when TransCanada can't." 

On the other hand, one of the Edelman documents suggested, “To make an informed decision on this project, Canadians need to have a true picture of the motivations not only of the project proponents, but of its opponents as well.”  

Meanwhile, BuzzFeed reported that an Uber executive suggested digging up dirt on journalists, "specifically to spread details of the personal life of a female journalist" who had recently accused the company of “sexism and misogyny.” The executive who made the suggesttion later explained he thought he was speaking "off the record" at an industry dinner. He said he "regretted [the remarks] and that they didn’t reflect his or the company’s views."

In my three decade career, I can only remember one time when a senior executive asked me to gather information we could use to discredit a reporter who has become a thorn in our side.  I told him it was a stupid idea and that was it. I should have also told him it was unethical.

Some background research on journalists is perfectly ethical. There's nothing wrong with collecting and analyzing what reporters have previously written to better understand their point of view of your company and the industry. At minimum, that could enable you to anticipate their interests and questions.

There's also nothing wrong with tracking public details about a reporter's private life or information he or she is willing to share, such as a spouse's name, children, alma mater,  hobbies, etc. Such information can help build a stronger personal relationship with the reporter. But digging for embarrassing or unseemly information is clearly unethical on just about any ground I can think of.

It's a violation of the reporter's privacy. It's clearly dishonest. Why else would the Uber executive blow off an objection on the grounds that “Nobody would know it was us”? But perhaps most importantly, it muddies the waters of public discussion and deprives people of information about the company by casting irrelevant aspersions on the reporter whose bringing it to them. It's not responsible advocacy by any measure.

The key word here is "irrelevant" and that could be the safe harbor for Edelman. If its background research is intended to reveal relevant information about the pipeline's opponents, such as conflicts of interest or extreme positions they have taken in the past on similar projects, it could be ethical.

But if the agency's oppo research team is seeking irrelevant information it can spread around to -- as one document says, “Add layers of difficulty for our opponents, distracting them from their mission and causing them to redirect their resources,” they should join the Uber executive mentioned above in the ethical penalty box.

 

 


New rules of persuasion

Social mediaMore than a new majority in Congress emerged from the recent election. Some new rules of persuasion were revealed as well.

Elections have long been fertile ground for scholars trying to figure out the shape of public opinion and the forces that change it.  

The presidential campaign of 1960, for example, gave us the concept of  pseudo-events like debates and photo ops,  which inevitably led to the development of pseudo-qualifications on which dozens of candidates have run ever since (and on which several have actually won). 

Indeed, the practice of public relations has arguably lifted more lessons from politics than the other way around. Sometimes the wrong lessons (the use of war rooms and truth squads, negative campaigning, etc.). But also useful lessons (micro-targetting, staying on message, etc.).

Ever since Obama's 2008 campaign, social media has been the dominant platform of campaigning, just as television had been since the 1960s. It was not only the key to the Obama campaign's fund-raising, it also proved to be critical in his ground game of turning out the vote, giving communities of common interest targeted information, and engaging people who had previously expressed little interest in politics. 

Social media had been around long before Obama's campaign, of course. But his team was the first to realize social media are not new screens, ripe for advertising messages, so much as on-going conversations with their own rules of engagement.

So it will be interesting to see how long its takes for PR practitioners to internalize the insights emerging from the latest bi-annual exercise in electioneering.

Ben Smith's latest BuzzFeed column hits on a particularly intriguing insight:

"Persuasion works differently when it relies on sharing. ... And the social conversation favors things that generations of politicians have been trained to avoid: spontaneity, surprise, authenticity, humor, raw edge, the occasional human stumble. (Joe Biden!)... 

"A few modern politicians appear to have a real feel for the raw emotion and, sometimes, (apparent) spontaneity that people will want to share. Elizabeth Warren's blunt and casual economic 2011 tirade and Ted Cruz's theatrical confrontations (and even his own low-production-value cell phone videos) are the beginnings of that viral populism for which the social web has opened a real space."

How long will it take for major brands to figure out what this means for them?

 


A tale of two layoffs

Facing a Layoff When You Have Bipolar DisorderMicrosoft announces "massive" layoffs and the media essentially yawns.

In 1996, AT&T announced layoffs of the same relative size -- about 14% for Microsoft and 13% for AT&T. But AT&T and its CEO at the time were pilloried as "corporate killers."  

The circumstances appear very similar:

  • Both companies were eliminating jobs as part of organizational restructuring -- Microsoft because it was absorbing the acquisition of Nokia; AT&T because it was splitting itself into three companies.
  • Both companies were financially healthy when they announced the layoffs -- Microsoft even more so with profits of $22.5 billion versus AT&T's $5.5 billion (excluding restructuring charges).
  • Both companies made their announcements in a time of economic uncertainty -- Microsoft even more so. The unemployment rate in January 1996 was 5.8% versus the current 6.1%.

Here are the differences:

  • AT&T's number was bigger -- 40,000 versus 18,000. In fact, AT&T's CFO at the time sent the PR department off to see if it would be the biggest number of jobs ever eliminated in hopes it would really impress Wall Street. He was bummed out when we told him IBM, GM, and Sears had all beaten us to the record. Still, the media likes big numbers.
  • AT&T's announcement was vague on which jobs would be eliminated. In fact, the majority were in the manufacturing business being spun off and even those jobs were in divisions to be sold. Microsoft has been forthright in explaining most of the jobs eliminated will be in its Nokia division. And it promised that division heads would be able to explain the impact within their organizations almost immediately. AT&T's division heads didn't have that information for weeks.
  • But the biggest difference grew out of AT&T's focus on Wall Street rather than Main Street. The company set out to produce the biggest restructuring charge possible. At the highest levels, executives saw it as a singular opportunity to launch all three companies with clean balance sheets and the lowest possible costs. At lower levels, managers saw it as an opportunity to create reserves that could be reversed later to produce reportable income. That's not financially kosher, and the SEC tries to police it, but it happens every time a company takes a restructuring charge. 

Ironically, these differences were magnified by a decision few of us realized would be so significant at the time.

Just before the original restructuring announcement was made in September 1995, the company's CFO met with a group of analysts who covered the company to give them a heads up under non-disclosure. They asked him when the companies to be spun off would actually leave the nest and he told them it would take at least a year -- meaning most of 1996 -- just to unravel the financials and sort out assets like patent licenses and shared real estate.

"Why so long?" was their reaction. "If you could get it done before the end of the 1995," they said, "you could put all the restructuring charges in the last year of the integrated company, when no one really cares." That made sense to the company's CFO, so at lunch, just before the announcement of the restructuring, he said, "We're going announce that all this happen by the end of the year. Pass the pickles."  

As a result, AT&T announced the job eliminations and associated restructuring charges on one of the slowest news days of the year -- the first business day of 1996. In addition to guarnteeing headlines in every major newspaper, it also made the construction of the restructuring charges pretty sloppy. At announcement, we had one number -- 40,000 jobs, which was quicly translated into "40,000 layoffs." We couldn't break it down much further.

Worse, all of those jobs were characterized as "AT&T" jobs because the manufacturing division didn't have a name yet. We were calling it EquipCo internally. If the announcement had been made just six months later, it would have been issued by two companies, AT&T (18,000 jobs) and Lucent Technologies (23,000 jobs).

Announcing on the first business day of January also put it in the middle of the presidential primaries in New Hampshire. Pat Buchanan who was lagging in the race saw it as the perfect opportunity to stir up the electorate, railing against greedy CEOs. And when Buchanan unexpectedly won in New Hampshire, the media connected the dots. From then on, AT&T was on the defensive. 

AT&T had focused entirely on impressing Wall Street and lost Main Street. The final irony: Main Street became so sour on AT&T even Wall Street lost confidence in the company. And its long slide to disintegration began. 

Three of the biggest things we learned in this whole fiasco:

  • Events outside a company can shape -- even distort -- how a company's actions are perceived. Who could have predicted Pat Buchanan of all people would play such a big role in AT&T's travails?
  • Once the media have a stake in a story, its premise can't be dislodged. No matter what you do. "Downsizing" and "corporate greed" became memes in 1996 and AT&T became their trope. 
  • A crisis doesn't end until there's blood in the water. AT&T's annus horibilis didn't end until the company's CEO was forced out. (The new CEO had a honeymoon of about a year before his anni horribiles began, but that's another story better told here.)

Forward this blog to your friends at Microsoft.

 

 

 

 

 


Bad for business

Rip journalismThe CareerCast web site lists "newspaper reporter" as the second worst career to pursue in its 2014 report. That's just ahead of lumberjack, which ranked 200.

Ironically, there's a connection between the two. Newspapers are closing left and right, meaning the industry needs fewer reporters -- and newsprint, which is produced from the wood pulp in the trees lumberjacks fell. All in all, the Bureau of Labor Statistics estimates a 9% drop in logging positions by 2022, and a 13% decline in reporters.

At the other end of the scale, among the fastest growing jobs, is public relations. Some estimate it's will grow 12% over the next decade. In other words, PR will grow by about as much as journalism declines. 

The disparity in this ratio concerns me, even though I spent virtually my entire career in PR (not counting the summer I wrote feature articles for the Suburban Press and Recorder in Natick, Mass.).

Here's why:

  • When I worked for AT&T, the best coverage we got was from the smartest reporters for the best newspapers. We didn't always like it, but it was intelligent, logical, and fair. When we had news, they helped spread it. And when those reporters compared us to the competition, we usually came out on top. No one could snow them. From what I hear, the average reporter covering business these days is much younger, much less experienced, and stretched thinner than the elastic in Chris Christie's underwear.
  • Trust in the media has never been lower. But it can get to even scarier depths if what passes as news on the Internet gains much more traction. Part of the problem is that online no one knows you live in your mother's basement and get most of your scoops from the signals your aluminum foil hat picks up.
  • Some people think brand journalism can fill the gap. Talking directly to your customers is certainly important. But just as we need a healthy journalistic community to keep our politicians honest, the business community will be better off if its policies and practices are occasionally reviewed by intelligent reporters with no axe to grind. 
  • Finally, it's true that all these new PR people won't be in media relations. PR covers a wide range of activities -- e.g., employee communications, community relations, speechwriting, philanthropy, etc. And it's also true that any PR person who makes it harder for a journalist to do his job doesn't really understand PR. But that's exactly what a lot of journalists are complaining about. I don't think it will get better when there are fewer reporters and more PR people.

 

 


PR Ethics

Times 7-16-24Ethics and PR sound like an oxymoron. But the headline and first three paragraphs of this front page story in the New York Times say all you need to know about the subject.

Documents Show G.M. Kept Silent on Fatal Crashes

By REBECCA R. RUIZ and DANIELLE IVORY
 
The car crash that killed Gene Erickson caught the attention of federal regulators. Why did the Saturn Ion he was traveling in, along a rural Texas road, suddenly swerve into a tree? Why did the air bags fail? General Motors told federal authorities that it could not provide answers.

But only a month earlier, a G.M. engineer had concluded in an internal evaluation that the Ion had most likely lost power, disabling its air bags, according to a subsequent internal investigation commissioned by G.M.

Now, G.M.'s response, as well as its replies to queries in other crashes obtained by The New York Times from the National Highway Traffic Safety Administration, casts doubt on how forthright the automaker was with regulators over a defective ignition switch that G.M. has linked to at least 13 deaths over the last decade.

"G.M.'s response" almost certainly came from someone in its regulatory department. A similar response could just as easily have come from someone in the PR department. 

What was the response the Times found so wanting?

The company repeatedly found a way not to answer the simple question from regulators of what led to a crash. In at least three cases of fatal crashes, including the accident that killed Mr. Erickson, G.M. said that it had not assessed the cause. In another fatal crash, G.M. said that attorney-client privilege may have prevented it from answering. And in other cases, the automaker was more blunt, writing, “G.M. opts not to respond.”

As I've said before, I was never asked to lie when I did PR for AT&T. But learning the truth was not always easy. In any large organization, elements of the truth are closely held by multiple organizations, each with its own agenda. That's probably what happened at GM.

But PR people have an ethical obligation to ferret out the truth. Not because they are holier-than-thou, wannabe journalists. But because they are the company's representative in meeting its obligation to serve the public interest.

Ethical training for PR people has to start from that premise.

 


Gay marriage and public opinion

Gay-wedding-topper-ideaqsThe majority of Americans support gay marriage, which is now legal for about half the U.S. population. 

That's a remarkable change in public opinion in a relatively short period and it's fair to ask how it happened.

In a recent column, Gordon Crovitz -- former publisher of the Wall Street Journal -- credited a Supreme Court decision striking down California's Proposition 8, a 2008 initiative that banned same-sex marriage in the state. 

Crovitz is one of the savviest observers of the digital scene. He probably did more than anyone to guide that venerable paper through the swirling tides of the Information Age.

But even he can misread the bobbing and weaving of public opinion.

"Public opinion changed because litigation showed how same-sex marriage could strengthen the institution, not undermine it," he wrote. 

The suit -- litigated by the unlikely team of Ted Olsen and David Boies, formerly opposing counsel in Bush v. Gore -- was undoubtedly an important step towards legitimizing gay marriage. But that's not where the case was won in the court of public opinion.

It was won on a smaller, more personal stage -- television.

When programs as popular as "Bones," "The Good Wife," "Grey's Anatomy," "Downton Abbey," "Nashville," and "Scandal"  make people's sexual orientation -- and marriage -- a normal part of life, ordinary people begin to think differently about it.

That's the real lesson in swaying public opinion -- make your position look normal to the large number of people who are not engaged in the fight on either side. That way, you're pushing through an open door.

Of course, it helps if -- as in the case of gay marriage -- it is normal.

 


You don’t have to be loved, but you’d better be liked

ChristieOne of the paradoxes of corporate -- or political -- life is that people expect their leaders to be tough but likable. Toughness can be commanding and inspiring, especially if it springs from competency. But even then, if it edges into meanness, likability goes out the window and followers fall by the wayside.     

The line between “tough” and “mean” is hair thin. 

Many CEOs have crossed it to their great regret, even if their boards never caught on. It’s simply very difficult to manage by fear and greed. At some point, people aren’t willing to pay the price.

Chris Christie has never had a problem being commanding. But he’s often come just to the edge of meanness, sometimes over-hanging it by more than a bit. He usually got away with it because he seemed so likable. In all his bluntness, he said what many of his constituents were thinking, down to the same profane words.

Then the Bridgegate Scandal suggested the governor has an even darker, previously unseen, side.

The jury is still out on his personal involvement in the scandal.  If he is proven in any way responsible, his formidable goose is cooked.

Meanwhile, as his recent “Tonight Show” performance demonstrates, the governor is giving a master class on likability.  The basic rules:

  • Laugh at yourself, not at your problem.
  • And allow yourself to be vulnerable.

The Softer Side of Goldman Sachs

SoftOne of the most tough-minded firms on Wall Street seems to be taking a cue from ancient Chinese philosophy and modern geo-political strategy.

Goldman Sachs is exercising its "soft power." 

The basic idea may have originated with the ancient Chinese poet and philosopher Lao Tzu, but Harvard University’s Joseph Nye popularized the concept of  “soft power” way back in 1990. 

His timing was apt. The Soviet Union had recently collapsed, some people were declaring “the end of history,” and it looked like the U.S. would single-handedly command the world stage for the coming decades.

Nye’s premise was that the U.S. defeated Communism largely through the exercise of “hard power,” i.e., the threat of over-whelming military and economic force. But getting the rest of the world to follow our lead from that point on, he said, would require the exercise of “soft power,” i.e., the power of attraction.

It was a controversial idea to some. Practitioners of realpolitik, who believe the only power that works in the real world is the kind that can be dropped on cities, considered it naive. But even Machiavelli – the original political realist – noted that, while it’s better to be feared than loved, the ultimate danger is to be hated.

Now there are signs that the likes of Goldman Sachs has discovered the advantages of developing and exercising soft power. 

"We have influence,” CEO Lloyd Blankfein told television interviewer Charlie Rose, “but it's the softest of the soft power, the softest of the soft influence. What we do is we put out ideas. We defend our ideas, we are provocative, we show initiative. But at the end of the day, we don't have the power to execute."

Maybe not. But if the ideas a company floats are compelling enough, it can play an important role in shaping the environment within which it operates. In the world of public relations, this is called “thought leadership.” 

Blankfein’s chat with Charlie Rose, for example, came in the context of the firm’s “North American Energy Summit” which brought corporate CEOs, public officials, and industry experts together to debate how the region can achieve its energy potential while meeting environmental concerns. 

Among the attendees? A host of public officials who once would have thought twice about being seen in the firm’s Wall Street headquarters, including vice president Joe Biden, Treasury Secretary Jacob Lew, Environmental Protection Agency administrator Gina McCarthy, and Energy Secretary Ernest Moniz, as well as several U.S. governors, government officials from Canada and Mexico, and the CEOs of a number of energy companies.  

There’s an obvious business benefit to being perceived as the intermediary between such powerful players. But it also gives the firm an attractive “pull” with longer-term benefits. Expect Blankfein and other top Goldman executives to be increasingly outspoken on the topic of environmentally responsible energy development as a spur to job growth. The topic is at the center any Venn diagram of stakeholders' concerns, the firm’s competencies, and its long-term business interests.

That’s where the seeds of soft power are.

 


The voice of the paparazzi

Paparazzi

The paparzzi used to focus their lenses on the likes of Brad and Angelina for the vicarious thrill of the masses. But now they and their keyboatd wielding colleagues play a critical role in corporate governance and marketing.

Way back in 1970, economist Albert Hirschman suggested consumers and investors have only two choices when they believe a company is doing them wrong: they can "exit" (end the relationship) or they can "voice" (complain until the company changes).

As a practical matter, exit doesn't accomplish much any more. Organized product boycotts are rare. And when Hirschman wrote his paper, the turnover of an average managed mutual fund was 17% a year; by 2000, it was 91%, meaning funds sold nearly all of their holdings every year. Many funds, in fact, have turnover ratios of more than 100%, holding the typical company share for less than a year.

That leaves voice. Again, when Hirschman wrote his paper, voice belonged to a privileged few. One consumer's voice tended to get lost in the  clamor of the marketplace. Even if consumers or investors ganged up on a company, their voices could be drowned out by a barrage of advertising and misdirection.

Today, everyone is a publisher. Blogs and tweets have outsized influence. According to one survey, 90% of consumers say their purchasing decisions are influenced by online reviews.

And media of all sorts amplify the voice of governance experts who used to toil in obscurity. Just this week, the media reported Walmart's board was criticized by an institutional investor group for being too chummy with management. Last week, the media reported Chipotle's sharowners overwhelmingly voted against an executive compensation plan they considered overly generous.

None of these expressions of "voice" is binding. But when the mainstream media report them, they take on added urgency. Corporate America is not governed by the media, but it is highly influenced by it. When I attended AT&T board meetings, I was far more likely to hear "how will the Journal react to this," than "what will the SEC say."

And then this story on the front page of today's New York Times puts a human face on GM's ignition switch problems, turning the emotional level of the discussion way up. 

Law and finance professor Louis Lowenstein termed all this "the voice of the paparazzi," way back in 1999 before the Internet changed everything. Ironically, his son, Roger Lowenstein, is one of the most highly respected of those voices.

"The new voice in town is the raucous, incessant beat of the analysts and the media, and boards and CEOs now pay heed," he wrote. "With good numbers on which to base detailed, credible reports and stories, those oh so rude paparazzi have an impact that puts ministries of finance and cronyism to shame."

That new voice now has more power than Prof. Lowenstein could ever have imagined.