Arun Sudhaman 30 Aug 2011 // 11:00PM GMT
SINGAPORE--A group of senior Singapore-based comms chiefs have called on PR agencies to adjust their models in light of the rapid changes in in-house public relations needs.
The view formed one of many unfettered exchanges on the topic of agency relations, at the Holmes Report’s first Singapore Communicators Roundtable, held in conjunction with Fleishman-Hillard. A frank discussion touched on such topics as changing in-house responsibilities; relevant agency skills; the issues surrounding talent and quality; and the critical factors that determine the success of an agency-client relationship.
Chaired by Holmes Report managing editor Arun Sudhaman, the panel featured a select group of senior Singapore-based comms heads:
Tarun Deo, SVP, MD and senior partner, Fleishman-Hillard Asia-Pacific
Stephen Forshaw, managing director of corporate affairs, Temasek
Arent Jan Hesselink, head of corporate communications, Philips Asia-Pacific
Erik Jonnaert, vice-president of external relations, P&G Asia
Geraldine Kan, strategist at Linea Communications, former communications head for emerging markets at Lenovo
Myrna Thomas, head of communications, Temasek Trust
Dramatic changes in communications roles
The discussion first considered how the comms chief role has changed in the past two years. Many of the panellists pointed out that there has been a dramatic shift in the duties and responsibilities that are now required. Those shifts, unsurprisingly, have profound implications for how agencies invest in and build their capabilities.
Forshaw: What we’re now seeing is a requirement for communications directors to be extremely plugged in to the business. That is the difference between the in-house director and the agency counselor. Second, is what I call the air traffic control approach. We are like air traffic controllers. We have a radar screen in front of us and we are watching lots of blips - those are the issues that potentially affect our reputation. Our job is to guide those issues and hopefully avoid collisions. Often we think of the role of the communications director as being the voice of the organisation to the outside world, and that’s a very important part. But equally important is the role to be the voice of the outside world, inside. It’s to highlight to the business things they may not see and may not be paying that much attention to.
Thomas: Finally, there is a recognition that this role is much more than media releases and relationships. The demand to understand the business is very important now. The greater challenge is the fact that many of the business are under really tight scrutiny, from the public at large and regulators particularly. Therefore the external relations case is becoming even more important. The agenda is not just the business agenda, it’s the regulatory agenda, it’s even the national agenda. One really needs to understand the vibes, both internally and externally, and understand the agenda of a business at any given time. And the CEO agenda. The role of the communications director is multi-faceted and that is the challenge, both internally and from the agency side. You have to be investigative, have wide networks, have the trust of senior management, and be very flexible.
The agency challenge
“Agencies face a particular challenge because you bill according to hours, but when you embark on a project it’s changing,” added Thomas. “The individuals that are being recruited now need to be quite different.” Accordingly, F-H’s Deo encapsulated the issue facing PR firms as follows:
Deo: Today, clients are looking at specialist skills, generalist skills, writing skills, digital production, social media. There are a lot of demands being thrown at agencies. My job is to cut through that and say here are the skills we need to bring into the firm. Unlike ad agencies, sometimes there’s always that big resource question: Do we spend all this money and make this investment? Is it going to pay off? How do you pick and choose the right things so you can then monetise those quickly? That’s the big challenge from an agency point of view.
Agency models vs client needs
The discussion of shifting client demands, versus the agency objective of investing in talent and building business prompted the next question. Have agency structures, billing models and talent kept up with client needs? And, if not, how can clients and agencies bridge this divide?
Thomas: No. There is a real challenge in terms of talent.
Jonnaert: We have a tendency in companies to blame the agency. Every year, all of our agencies are being evaluated. As always, our demands are very high. It forced us to rethink: Is there something we can do better as well? One of the things we started to do in Asia in particular is introducing the mantra that we no longer look at agencies as suppliers of agencies. That creates a certain behaviour. We say they are an extension of our organisation. You can say it, but what does it mean? We try to involve agencies now in everything we do, such as training. We created an agency summit to bring all of our agencies across Asia-Pacific together, to give them the full perspective on the business. Frankly, you need to have that big picture.
Deo: That is exactly the kind of approach that we relish. It then allows us to sit down with our partners and ask what we need. It allows us to put in place teams with the right kind of skillsets. The benefit is you are able to build something that is meaningful. The more information we get from clients, the closer we are allowed to get to their business, the more effective we can be in terms of providing value.
Forshaw: For me, the key in the relationship is, how good is the client at briefing the agency? My view is, when agency and client are speaking different languages, that’s the fault of the client. When you as a client lift the calibre of your intellect in your brief to an agency, the agency generally lifts the calibre of the intellect that they bring to the table. At Microsoft, we conducted a significant review of our agency at a regional level. In the first three months, it required a heavy investment of our time - it means setting expectations and the tone. When the agency pushes back on you, that’s not a bad thing. There’s a lot of work on the part of the client that’s very important to make the agency relationships successful.
“Agencies are very quick to say yes”
From a broad consideration of models, the conversation soon zeroed in on the critical specifics of the agency-client relationship. Thomas pointed out that, for both sides, the quality of anticipation is of particular importance, because of the sudden issues that arise on a daily basis. Other panellists chimed in with their views of the skills required to make any partnership a fruitful one, with Forshaw sounding a note of caution about the merits of using “global agency chains” because of concerns over consistency.
Kan: How do we build trust between the client and agency and verse versa? At a senior comms level you are not just looking for counsel on how to push products. For the agency to give you good counsel, it needs to understand the values of your company and the hot buttons inside. As clients, we sometimes fall into the trap of viewing agencies as just a vendors. Both sides have to ask the right questions.
Deo: The key to building trust is that there are a lot of agencies that, for whatever pressures, are very quick to say yes. I think that is something that a lot of agencies really need to do a little introspection about. Because saying yes, and not being able to deliver, is a big problem for our industry. One of the things we do a lot is look at the connectivity within our network. We have 80 offices, but can we pick up the phone in a client’s time of need and actually deploy the right kinds of resources quickly?
Forshaw: The problem here is that, in the case of the very large global agency chains, the standards are very different, and alarmingly so. The agency chains have got a lot of work to do in this area. It does come down to trust but all it takes is one breach among those 80 offices. The irony is that PR agencies are primarily there to help companies build brands and one of the key attributes of branding is consistency, and it is that attribute that remains a fundamental challenge for agencies in this part of the world.
Hesselink: The chance of proving what we are worth for a company has probably never been bigger. But the same goes for the agency side. The chances for them to establish true partnerships have never been better. Half of the markets in the world are in dire straits. At this point in time, what we need is partnership and long-term strategic advice. All that stuff about rates is not what it’s about. If we get through this, partnerships will be established that could last long.
Agreeing with Hesselink, Jonnaert observed that the demands made of in-house comms functions are rising, in some cases at a rapid pace. This, he added, means that the future for agencies are bright. “There is a limit to what companies can invest in in-house resources, but the demand from our functions is getting higher and higher.” This, though, means that agencies must confront the issues that exist around quality and talent management.
Jonnaert: I see a few challenges, or call them opportunities. One is clearly people management - when you look at quality of service, it is not at the same level across markets. With advertising agencies, it is more similar. In our business it is very much about connections and is very much influenced by the individual. This will require much more time and investment in developing people in agencies. By doing more of that, you may address the other issues you see often on the agency side, which is the retention issue. There is still this custom of people job-hopping all the time. While on the client side, that’s what we hate - we want continuity of relationships. If we have to brief you over and over again, it’s a waste of time on our side. If we look at agencies as an extension of our organisation, we require some continuity. And the third challenge, especially in the big groups - how can we make sure that best practices, within your networks are exchanged in a more systemic way.
Coalescing around the topic of talent, Thomas noted that the quality issue was “critical”. With this in mind, Thomas applauded the rise of client relationship director roles at agencies, but added that this remained the biggest internal challenge facing the agency world. There was also a feisty exchange when Thomas took agencies to task for “parachuting” people in based on their own career development agendas.
Kan: How does an agency build a system where it works across different countries? Its incumbent on agencies to train people, not just on the hard skills, but on an understanding of geopolitics and different cultures.
Deo: From an agency point of view, it’s important that we look at the glue that allows us to provide clients with a consistent product. What’s the glue that allows us to ensure that the calibre of people that we put on your business begins to look and feel consistent? If you are able to win a global or regional piece of business, you are actually working with a diverse group of people on a single client mandate. You are looking at it differently and much more consistently, than you would as separate silos. That is really the glue that allows us to move people around. It makes our life a little bit easier to provide a more consistent product.
Thomas: The other thing is that agencies have their own agendas, they may want to look at succession planning, that kind of thing. At the end of day, they are existing on their service level to clients. Now that Asia is becoming a thriving source of business for agencies, there is a lot of parachuting of people in.
Deo: I just want to put a question out there. Does the fact that somebody looks Asian…I mean you have a lot of people who are foreigners, who have live in Asia for many years.
Thomas: My point is, don’t parachute somebody in because you think I’m going to be more comfortable with an English-speaking person. Or because you have some career development plan for this person. Fine, carry on with your career development plan but please don’t hoist him onto the client.
Deo: I think a lot of the parachuting that should happen is that it should be an issue-based approach. So if you have some who is an expert on a particular issue in DC, and you have a client in Beijing facing a similar issue, I think that’s where the parachuting is viable, clearly. But you are absolutely right, there are many instances where you parachuting somebody in because it looks good.
Thomas: It is also based on a misperception that, because a lot of the MNCs have communications heads that are not Asian, they are more comfortable with somebody who is not Asian. And, believe me, I can tell you this is a misperception. What is the company looking for? Solid support in their market. It doesn’t matter who this person is. This is something agencies have to come to terms with, their own internal agendas and how this impacts on clients.
Forshaw: I think it really comes down to the skill level and the affinity that person has for the market. I more interested in their merit and the skills they bring to the table. I think this is a cosmetic issue. I just want the best person. You want to parachute people in as a career development move? That’s fine, but don’t make them the lead on the account.
Thomas: Career development by agencies cannot be at the expense of the client.
Deo: We don’t approach it any differently to how some of our clients approach career development. We would be very circumspect about putting someone in there based simply on our own agenda.
What does agency value look like?
The topic of ROI rarely strays far from the surface where client-agency relationships are concerned. The panel was asked how they define and measure PR value, and whether agencies can improve how they demonstrate this. Forshaw looked back at his experience running Microsoft’s regional PR review in 2010, and the 12 criteria that helped him determine agency success.
Hesselink: For me, value is in having people who help understand how things work in the 14 markets which we cover. Value is in bringing things to me, rather than doing what I ask. And we are building something for the future - if you can instil that within the relationship, you are on the right track. It sounds simplistic, but I think that I know when the relationship is reaching full potential when, one the one hand, I get calls saying: ‘You need to start think about this.’ One the other hand, it’s when I start hearing ‘no’. It’s that simple. When I’m planning something that doesn’t make any sense in this part of the world or this country, or because I’m asking for something that can’t be delivered based on capabilities.
Forshaw: As long as it’s not ‘No, we haven’t got any hours left’!
Thomas: I think market intelligence is of increasing value to companies. The ability to know a company so well, and pick up what is happening in a society or parliament, which is not often reported in the English media. I use the example of Indonesia with its single presence policy, the rumbles of this were reported to us well in advance by our agency, and it was most helpful. If agencies can provide this critical intelligence, they really bring value, and there is no price tag to that.