Obvious question of the day: how important is communications to the business world? The answer, as we all know, is “extremely”—but if you’d asked business executives ten years ago you would have gotten a very different response.
Corporate leaders now understand the value of public relations, but MBA programs are only beginning to catch up. The result, according to a white paper recently published by the Arthur W. Page Society, is a global community whose leaders are not properly trained in the art of corporate comms.
“Teaching Strategic Communication in Business Schools: New Evidence from the C-Suite” reveals a prime opportunity for PR to reassert its value and play a more prominent role in shaping the next generation of corporate leaders.
To discuss its findings, we recently spoke to Jennifer Prosek, author and founder/CEO of Prosek Partners, who wrote the paper with James O’Rourke, professor and director of The Eugene D. Fanning Center at the University of Notre Dame’s Mendoza College of Business.
The C-suite hasn’t always respected PR. Prosek tells us that, when she graduated from Columbia Business School in 1999:
“…there were no people in my graduating class who understood what I did for a living. People would look at me like I had ten heads, like ‘why are you at business school?’
Later, when I spoke to a class at Yale School of Management about alternative careers in communications for MBAs, only three students showed up.”
Things are changing, though. And fast.
“The people who we interviewed for the paper were C-level executives with MBAs who now wish it had been part of the curriculum back in the day.
An earlier PRSA study found that 98% of senior business leaders think schools need to integrate corporate rep/rep management into the MBA curricula and 94% believe top management needs additional training in core communications skills.”
Why such a sudden shift?
“20 years ago, it was a one-way communications situation. You could put out your messaging and people just listened to it—they didn’t engage with it and they didn’t have channels to amplify their views.
But we’ve had several crises of confidence that have led to a greater awareness of corporate reputations: Worldcom, Enron, the financial crisis, etc.
Social media, citizen journalism and the 24/7 news cycle have contributed as well. You cannot lead an organization today and not be concerned with what people around the world are saying about your company.”
So why was there so little focus on communications in the past?
“Because business school was focused on finance and operations, period. Graduates would either go to Wall Street and operate a company or become a consultant. Communications was viewed as ‘nice, not necessary’, but now I think we’re definitely in the ‘necessary’ box.”
A change is needed because “Graduating future leaders of organizations who don’t have a firm grasp on reputation management would be doing a disservice to them” and “there is a higher demand from companies and recruiters for MBAs with great comms skills.”
How has the corporate view of communications services changed?
“My agency caters to the financial world, and five years ago private equity firms and hedge funds did not typically employ outside agencies because they were under the radar screen.
Now I would say about 99.9% have reputation management consultancies. That’s a huge shift in Wall Street’s mindset.
According to the Edelman trust barometer, financial firms are now rated lowest in trust and credibility. Five years ago it wasn’t just someone else’s problem; it was something you didn’t have to worry about at all. That’s no longer true.”
To whom do these executives need to communicate more effectively?
“Many execs still don’t care what the public thinks, but they care very much what their investors think. Most of the money hedge funds manage comes out of public pension funds; if your reputation goes in the till then they’ll be pulling their money.
I met a CEO of a private equity firm who said ‘We don’t talk to the press’—he doesn’t understand that part of his job is to monitor the reputation of his firm. But that’s the old-school mentality; I see hedge fund managers hiring chief marketers now.”
Your end goal with this study is to change business culture. What’s the next step?
“PRSA already launched a pilot program in several schools; now we have to work with the deans to figure out what the proper curricula should be at their schools. We’re going to be marketing!”
How does this paper reflect on changes in the PR industry at large?
“I feel like the profession has been complaining for some time about not having a seat at the table, and this is an extreme move in the other direction. We are now in an a very good place in terms of being perceived as critical for business executives.
If we’d interviewed Jamie Dimon of JP Morgan Chase, I think he would have said ‘Reputation management is pretty freaking important!’”
(Pic via Reuters/Yuri Gripas)
Do you have a favorite quote from the paper?
“One participant said ‘If you reach the C-suite and you can’t communicate with your stakeholders effectively, you won’t be there for very long.’”
And that might just sum it up. Stay tuned for more on this move toward a more responsive MBA.