And what happened to common (PR) sense?

I am not one of those people who think that PR can do just about anything for a company’s reputation. Even when a business client is thrust into a death spiral, you’re far more productive spinning yarn than coming up with countless euphemisms for lay-offs, restructuring and re-whatever. But, I have been fascinated by (and how can I put this mildly) an appalling lack of common sense demonstrated by the pretty unusual PR contortions of some companies recently while begging for taxpayers’ money.

According to a Bloomberg story this week, Citigroup Inc. may spend about $10 million (US) on new offices for Chief Executive Officer Vikram Pandit and his lieutenants, after the U.S. government injected $45 billion of cash into the bank.  You may remember another story on ABC News about the CEOs of the three biggest US car manufacturers arriving in Washington in executive jets to plead for public funds. “Rick Wagoner flew in GM’s $36 million luxury aircraft to tell members of Congress that the company is burning through cash, asking for $10-12 billion for GM alone.”

Let’s get this part right. I don’t know if the PR people at Citigroup or the Big Three warned their CEOs that they are about to do something they shouldn’t. If they did or didn’t, the outcome was exactly the same. Which brings me to this conclusion: there is something terribly wrong with the executive communications function these days. 

I’ve worked with many CEOs and found that they come in two varieties. The first is a CEO that is acutely aware that he or she needs the advice and expertise of PR professionals to prep them for interactions with the media and the public. If they pick the right PR professionals they can help foresee the unthinkable and avoid minefields beyond anybody’s control. How? Because they know what leads to a negative story, they know when executives are taking steps that will lead to a terrible outcome. The second variety is a CEO as a command-and-control guy. My mentor gave me this advice about the latter kind: “Remember that when he is appointed he thinks he sits on the right side of god. Six months later, he thinks he’s god.”

Unfortunately, this led to the creation of two kinds of executive communications help. The first was the ultimate professional, capable of influencing decisions that prevented disasters. The second was the maître d’ kind, always agreeing with the boss, because god was always right.

The unbelievable period of growth from the early 1950s to last September was likely the major culprit in devaluating the executive communications function.  When the going is good, it’s hard to go wrong. Many executives began to treat communications the same way as day traders played the market in the early part of the tech bubble – any stock pick was a winner – it didn’t take any experience or intelligence to make the right choice.

Now, everything has changed. Chief executives and their boards need to take a fresh look at whom they need to hire into the executive communications function to help them pull through this recession. They have to hire professionals that will guide them through the minefields of the new world, because it doesn’t look like the recession will be over any time soon and they never had taxpayers as their major shareholders.