ANALYSIS: Is this the end of PR as we know it?

If the world’s largest PR consultancy chooses to drop the term PR from its corporate branding in order to take on a broader role, where does that leave the rest of the industry?

If the world’s largest PR consultancy chooses to drop the term PR from

its corporate branding in order to take on a broader role, where does

that leave the rest of the industry?

Burson-Marsteller’s decision to re-style itself as a ‘perception

management’ consultancy (PR Week 23 February) is more than simply a

cosmetic exercise. It is instead a very public declaration of intent.

When the world’s largest public relations consultancy chooses to discard

the term PR from its corporate branding, clearly something is afoot.

Quite simply, B-M’s senior management has come to see that PR is too

narrow a term to encapsulate all of the services provided by the


Yet B-M’s decision to downplay its PR heritage in favour of a broader,

catch-all communications label begs the question, what direction is the

business taking? And how does it intend to position itself in the

marketplace if it is no longer just a PR agency?

But before these matters can be addressed satisfactorily, the decision

to adopt the perception management tag needs to be set in context. For

the way B-M is presenting itself to the outside world is linked

inextricably to the structural changes taking place within the


Briefly, over the next 18 months or so B-M will undergo a worldwide

restructuring. Rather than running its business along geographical

lines, as it has in the past, the consultancy will be split into ten

‘practice areas’ including healthcare, technology, public affairs,

government, corporate and perception management consulting/knowledge.

Each of these practices will be headed up by a practice chair, a senior

executive who will be able to call on support from B-M consultants

working in the same practice area, wherever they are in the world. The

restructuring will also see the advent of global client managers within

practice areas.

Healthcare is so far the only area where this restructuring has been

effected. B-M worldwide vice chairman Edna Kissmann has been appointed

chair of the global healthcare practice and at the same time is client

leader for Johnson & Johnson. The other practice chairs will be

appointed in the coming months.

Outwardly, B-M has sought to underscore this wide-ranging internal

change by creating a new name for the services it provides. By plumping

for perception management as its badge, it has flagged up the fact that

it sees itself as being as much in the field of business advice as PR.

According to B-M European president and CEO Ferry de Bakker the

consultancy will ‘focus on business rather than just communications

objectives’. That’s pretty unambiguous: B-M intends to offer management

consultancy as well as PR advice.

To an extent this has already begun to happen. In Denmark recently B-M

beat heavyweight management consultants McKinsey and Co and Andersen

Consulting to land a change of management programme for three county

hospitals. This must have been particularly galling for Andersen, which

is a B-M client.

What then do management consultancies make of B-M’s encroachment onto

their turf?

‘For PRs I can see that management consultancy is a natural expansion,

but it’s not an easy one,’ says a partner in well-known international

firm of management consultants. ‘In my opinion chief executives will see

PR people as just that - people who communicate messages rather than

develop the content.’

‘The thing that worries me is the word perception because what we are

trying to do is get people to face up to and deal with the reality of

change,’ says Mike Jeans, director of global change management at KPMG

Consulting. However, Jeans adds that he ‘doesn’t argue’ with what B-M is

trying to do in focusing on business results as much as communication.

One concern that B-M will have to tackle is the possibility that by

becoming more involved with management issues they will lose their

identity as PR experts.

‘There’s a risk they could make themselves more bland than specific,’

says PA Consulting management group member Bridget Skelton.

Kissmann doesn’t think this will be a problem. ‘We have to make it very

clear that we’re in two kinds of business,’ she says. ‘We’re in a

consulting business and an execution business, and we don’t intend to

abandon one for the other.’

B-M will continue to work alongside management consultants in the areas

where it doesn’t have the skills base to act alone - such as finance or

IT-related management consultancy. But where the management consultancy

brief has more of a communications bent, in areas such as change

management, B-M will often tackle the task on its own.

Once appointed, B-M will, says Kissmann, try to ‘find the perceptual

lever’ - that is, work out what it is that causes a client to be seen in

a particular way by the public, investors, its customers and so on. As

this perception often has a direct bearing on a company’s performance

and value, it is not to be taken lightly.

While developing the perception management concept, B-M carried out

research to show that companies were valued on more than tangible assets

and results. It tracked the shares of the world’s six largest

pharmaceutical companies over a five year period.

According to Kissmann the research showed that 15 per cent of the

companies’ market capitalisation was ‘not explicable in a rational way,

it was down to perception’.

It will be intriguing to see what B-M’s clients make of all this a year

and a half from now when the changes are complete. Will they approve? Or

will they simply be baffled that the public relations company they hired

has transmogrified into a firm of perception management consultants with

10 divisions?

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