Davies Public Affairs
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Holmes Report
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Davies Public Affairs

Holmes Report

Five years ago, the leadership team at California public affairs firm Davies developed a strategic plan that set out ambitious growth objectives and acknowledged the need to diversify into new areas of activity in order to realize those plans. Today, the firm is on track to achieve—or even surpass—its financial goals: revenues were up by 60 percent in 2006 and Davies has grown from $3.5 million in revenues in 2002 to more than $13 million. And it has accomplished that growth almost exclusively by focusing on its core business, providing public affairs, issues management and community relations counsel to companies in the energy, healthcare and real estate sectors, while expanding its influence in all three areas beyond its California base to establish a national presence.
 Davies has carved out a unique positioning in the public affairs market by specializing in helping organizations deal with the not-in-my-backyard sentiment that can derail major construction efforts even after legislative hurdles have been cleared. The firm’s energy practice, led by chairman and chief executive John Davies, continues to handle community outreach and crisis management assignments for clients in the California market, while the real estate practice is now a dominant player in California and has begun to develop a national footprint, handling assignments in 21 communities last year and the healthcare group—led by recently-named president Brandon Edwards—now accounts for 40 percent of the firm’s revenue and is serving hospitals and healthcare providers on a national in 18 states.
 While many Davies clients expect confidentiality, due to the sensitive nature of the issues the firm handles, new business successes in 2006 included The Peebles Corporation (owned by prominent African-American real estate developer Don Peebles) and Hospital Corporation of America (the largest hospital owner and operator in the county, which just finished a $33 billion LBO). Interesting assignments included communications management for one of the largest new real estate developments in California, a 10,000-acre project that will one day be home to 40,000 people; public relations support for a multi-state dispute between a leading hospital system and one of the country’s largest health insurance companies; and securing approval for a new campus development for a leading liberal arts college in one of the country’s wealthiest and most development-sensitive communities.
 Davies has “assisted us in executing communication programs in key markets across the U.S. achieving important business objectives,” says Juan Vallarino, vice president of managed care at HCA. “The firm’s extensive knowledge of the healthcare industry made DAVIES a valuable resource in achieving our desired results.” Adds Russ Goodman, president of Sares Regis Group: “When it comes to creating strategic messages and winning community relations programs, there is no firm more effective than Davies.”
 Davies and Edwards are joined at the helm of the firm by Robb Rice, executive vice president for public affairs, and by 2006 arrivals Phil Stone, who rejoined Davies as executive vice president of operations to support the firm’s continued growth, and Tim Reinauer, who came on board as vice president of finance. The other new addition last year was Jeannine O’Malley, formerly of GolinHarris, who joined to lead the Blaze consumer market unit. Acquired three years ago (when it was known as The Blaze Company) as part of the diversification strategy, Blaze has been through some difficulty as a result of the acrimonious departure of founder Marci Blaze, but is now functioning a separate brand focused on creative consumer public relations.
There’s a fine line between a high-performance, entrepreneurial culture and a culture of rampant individualism. It’s a line California public affairs firm Davies has managed to stay on the right side of as it has grown its business in recent years, and helped the firm to the number one spot on our list of the Best Small Agencies to Work For. It attracts motivated, driven professionals by offering them intellectually challenging assignments (and above average compensation) and it keeps them by providing a first-rate work environment, proving its commitment by releasing some very talented and productive people because they weren’t right for the culture. “As a member of the Davies team, I feel that the company regards me as an asset as much as an employee,” says one respondent. “I find the type of work we do for clients both interesting and engaging, and I’m compensated equitably for what I’m able to bring to the table. I’ve worked for other agencies in the past, but none can be compared with Davies when it comes to being intellectually and financially rewarding to staff.” Another praises the “fast paced environment working alongside some very smart and innovative individuals,” while another likes the fact that “we are encouraged to use our brains 100 percent of the time instead of operating in ‘robot mode.’”
 Finally, Davies has joined the Lumin collaborative, a network of leading independent public relations firms—other members include CRT/tanaka, Padilla Speer Beardsley and Peppercom—developing new products and services for the public relations industry. It is also considering expansion of its own, with an East Coast office and perhaps a public affairs acquisition on the agenda for 2007.
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