Silos Belong on Farms, Not in Corporations
Arthur E.F. Wiese, Jr.
Vice President, Corporate Communications
Entergy Corporation
When I first became head of communications for a Fortune 500 corporation and got acquainted with my peers at other major companies, I was in for a shock. Most of them, I discovered, held government relations at arm’s length, trying to stay as far removed as they could from the work of their lobbyists. The two functions – public relations and government relations – not only operated separately in most companies, they rarely even conferred with each other.
I, on the other hand, have always believed that silos belong on the farm, not in corporations.
Perhaps it’s just that I’ve been a creature of Washington for most of my professional life. To me, government relations and public relations should be as tightly knit together as the fingers of a catcher’s mitt. That’s how I’ve seen them operate in my prior existences – first, as a newspaper political reporter and then as vice president for communications at one of the nation’s largest trade associations, the American Petroleum Institute.
At API, I was in charge of not just communications in the narrow sense but opinion research, coalition-building, grassroots organizing, community relations and advertising – all the building blocks of a well-integrated public affairs program except lobbying itself. All these functions should be seen as complementary tools for achieving a common goal – and that goal is to mold public views and public action to further the interests of the company, its shareholders and its employees. Government relations and public relations shouldn’t be distant cousins. They really are twins.
Just about everyone seems these days to be using this integrated approach – from the Sierra Club, the AFL-CIO and the National Rifle Association to the World Council of Churches, the U.S. Chamber of Commerce and the Girl Scouts. Everyone, it seems, except corporations.
My own – the Entergy Corporation – is different and, I’d like to think, less hide-bound and change-resistant than some others. I, for instance, have an office, as vice president for communications, at our corporate headquarters in New Orleans. But I spend only about one-third of my time there. My real base is in Washington, something almost no other communications vice president for a Fortune 500 company can say.
Washington is critically important to my company these days, much more so than when I joined it almost 10 years ago. We are part of a heavily regulated industry so we have to maintain relationships not just with the White House and Congress but with an alphabet soup of federal departments and agencies. As a result, I’m much more a Washingtonian than I am a New Orleanian. My D.C. office actually adjoins that of our government relations vice president. That’s how closely we work I’m not a lobbyist myself but I coordinate our communications programs to support and underpin our lobbying efforts. My portfolio includes not just internal and external communications, but community relations, advertising, opinion research – many of those “building block” functions of government and public relations integration I mentioned earlier.
Entergy’s integrated approach has proven useful not just in policy issues but in all kinds of crises. We used it in our long fight to keep operating our Indian Point nuclear plant outside New York City despite 9/11 concerns about terrorism, and we used it in coping with the hurricanes that devastated our utility territory in Louisiana, Mississippi and Texas in 2005 and 2008.
My CEO, once rarely seen in Washington, now is here often. He’s a passionate advocate of government controls on greenhouse gases. So he’s made a half dozen trips to town just this year to try and persuade politicians, regulators, think-tanks and the media on the climate change issue.
The same marriage of government relations and public relations that I’ve been discussing holds true where state government is concerned. So we use integrated communications to support our lobbyists in capital cities from Austin to Boston.
Public relations and government relations must – not should, but must – work together. The Government’s role in managing the economy and regulating nearly every aspect of human existence has been growing since Theodore Roosevelt’s presidency more than 100 years ago. Since then it has ballooned larger and larger, under both Democratic and Republican administrations. It’s being accelerated still more by the new Obama White House, which is far more activist, interventionist and regulation-minded than any administration since at least Lyndon Johnson’s. That’s not a political judgment – it’s just a plain fact.
So I may be a rarity right now as a corporate communications vice president based in Washington, D.C. But I may not be lonely for very long.
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Comment:
I agree with Paul. Silos exist throughout the organization and they impede the organization in many ways. Organizations were historically set up along the so-called value chain. Each internal group was there to contribute to the overall value of the company. There were support functions --HR, technology, etc.-- and then there were functions that created and sold the products--inbound logistics, R&D, outbound logistics, marketing, sales. The structure of the value chain as it appears in textbooks has virtical bands--silos for each function. They were to do their thing and then hand it off.
Companies do not work this way anymore, at least not the efficient one. It is time to turn the value chain horizontally. Companies should focus on the value they are trying to create externally. They have many stakeholders--customers, employees, investors, and others. Why not ask the internal organization to come up with integrated, consistent plans and actions for each of these stakeholder groups? It would not be appropriate to have a customer program from PR, marketing, sales, etc. They would have to develop it in harmony. Similarly, there would be one organizational plan for investors, employees, government, etc.
If the organization incentivized integration and penalized silos, it would soon find that the traditional silos would begin to break down. Granted, each of these activities would need an expert steward (marketing, communications, finance, etc.), but the concept of “ownership” within an organization would begin to unravel.
What this would mean for communicators is that we would really need to fully understand what we do to add value and stop arguing over small bits of turf between marketing, communications, etc., that may be intellectually interesting and functionally relevant, but add little value to the organization. Those who knew their stuff the best and had the best ideas would win, not just those who were appointed kings of a function.
When I was at Nortel, I headed both marketing and communications. I had a VP of Advertising who, as one would imagine, wanted to talk about advertising. I changed his title to VP, Customer Relations. His plans almost immediately changed. We gave prominence to those who headed Customer, Employee, Investor and Government activities. We asked all of the other communicators, trade events people, etc., to work with these VPs of major stakeholders to support them. The media were seen by us as being vehicles, not a key stakeholder. It was one small start to what we did throughout the company. Many in my organization argued that I was killing traditional PR; others said I was killing traditional marketing. Clearly I was. That was the intent.
In much of my work now with companies, I attempt this conversion through “Stakeholder Relations Councils”, bringing together all of the relevant functions to work together to integrate strategy with brand to engage the organization and enhance reputation.
What do others think?
By Elliot S. Schreiber on November, 07 2009
Member Comment:
I like Art’s timely point on the government relations/PR linkage impacted by current White House and congressional influence. Economic grounds are so shaken that everybody who is still standing has stakeholders who are either nervous or nauseous. The critical issues (health care, stimulus, jobs, climate change, trade, taxes) call for critical corporate responses. Causes cause effects that resist explanation. When companies jump into government-related issues in ways that can baffle observers and stakeholders (you’re taking government money now when our competitors are not?), when what the employees, customers and investors have been led to believe was okay (e.g., to belong to a green-advocacy group or a chamber of commerce group) turns elsewise, when things are this bad and it’s a good time to shuck factories and employees, and get government incentives to do it, well, it sure helps if the lobbyists and the communicators are tight in the C-suite. Er, I mean working together ever so cooperatively. I’d say Wiese has wisely counseled, drawing on his years as a Texas journalist, head of a newspaper bureau in Washington and president (I believe the youngest ever) of the National Press Club where he was raw-elbowed by corporate and government leaders trying their best to communicate.
By E. Bruce Harrison on November, 07 2009
Comment:
My only quibble is that this doesn’t go far enough. Knock down the silos between PR, customer relations, employee communications, investor relations, government relations and any other function that is about managing the relationship between an organization and its stakeholders. (Longer thoughts here: http://www.holmesreport.com/blog/index.cfm/2009/10/27/Knock-Down-ALL-the-Silos)
By Paul Holmes on October, 27 2009