Tag Archive: SEC Regulation FD


Are contributed articles overrated?

Are blogs overhyped?

Why even compare a traditional/conventional PR approach with digital social media? The answer lies in the increasing number of times that under-the-gun PR directors shun blogging in favor of contributed articles. Many assert that blogs are bandwidth hogs in contrast to contributed articles. Really?

Before I delve too deeply into this conversation, keep in mind I am not talking about guest commentaries or op-eds for major publications, such as the Wall Street Journal, USA Today or the New York Times. They have their own distinct and celebrated value based upon the power of their mast heads.

What I am assessing is the value of preparing contributed articles, particularly for technology, health care and financial trade publications by company executives, technologists, engineers, marketers and sales representatives. And then I am contrasting this marketing and brand management practice that almost goes back to the Book of Genesis to redirecting a least a portion of this time and effort to self publishing through blogging.

Almost DailyBrett has scars resulting from my efforts to convince many well-respected public relations practitioners to adopt a blogging program for their internal/external clients. Sometimes I have been successful, more times I have not. In these latter cases, the PR pros express SEC Reg FD (Fair Disclosure) concerns, worries about releasing proprietary information or cite time restraints in favor of contributed articles.

What is so curious is that contributed articles can take up to 8x the amount of time as a blogging program. Ever hear of the term, “re-spins?” A contributed article program is the Mother of All Re-spins.

Let’s see. First you contact the trade editor (who is awake at night wondering about the fate of her or his position/publication) and pitch the idea. The editor may like it or not. If so, s/he will ask for an abstract. You will then prepare and submit the abstract. Sounds good. Oops, the editor wants you to amend the abstract. Back to the drawing board (first re-spin).

Now it is time to re-submit your abstract. Whew, it was approved. Now comes the actual article, 1,000-words? 1,500 words? 2,000 words? You now submit the article internally for review. “Re-spin please.” Ugh. Another rev is completed, which is approved by the Powers That Be. Time to submit to the editor. Oh no, s/he wants some changes, time for the next re-spin.

Finally, your freshly amended contributed article is complete and it has been accepted by the editor. The only problem is three articles are ahead of your piece in the queue. Your submission will be published . . . next month. So how many months does a contributed article consume from initial pitch to actual publication? Three months? Four months? Five months? . . .

Yes, your contributed article has the advantage of authenticity that comes from being published under the imprimatur of a respected trade publication, but at what cost in terms of time and effort?

Now contrast that amount of time compared to digitally posting a conversational marketing piece by selected engineers, technologists, executives etc. via a company hosted blogging site is as little as one day? Can you build thought leadership and enhance the company brand via a blog? Certainly. This is particularly true when a blog post results in an on-line conversation with a prospective or established customer, an analyst, a supplier, a partner or a journalist.

Is there a realistic worry about a Reg. FD violation? That shouldn’t be a problem, if you have asserted and imposed control over who blogs and on what subject. And isn’t it common sense that you do NOT use a blog to publicly discuss next quarter financial results or anything else that may constitute a “material” event? What about proprietary information? Ditto when it comes to company controls, and besides how much can you really reveal in four or five paragraphs?

If a company has the horsepower, resources and talent, I would recommend both contributed articles and blogs and have the two be complementary pieces of your marketing and brand management tool kit.

For a start-up with very few of these attributes, self-publishing in the form of blogging is the easiest and most cost-effective answer to establishing thought leadership, building brand and painting a corporate portrait.

In the end analysis, contributed articles and blogging should not be mutually exclusive.

Wish I had a dollar for every time I have been asked to state a preference between corporate and agency life.

Yes, I have been fortunate to have worked for a decade in the trenches for a publicly traded technology hardware provider, LSI Corporation (NYSE: LSI) http://www.lsi.com, and also for three years-plus for an international public relations agency, Edelman Public Relations http://www.edelman.com. And with so many hiring managers and recruiters today seeking a “blend” of the two in this employment seller’s market, the easy answer is that if you don’t have one or the other, then you go out and fill-in the obvious gap on your resume.

Having said that, what choice should you make if you have dueling opportunities in these disciplines? The cop-out answer is that it depends on the individual. Not everybody was programmed from birth to thrive in a corporate culture of a carefully scrutinized and regulated publicly traded company. Likewise not everybody can succeed in an agency environment where compartmentalization and the constant demand to identify and win new business is a daily grind.

whiteboard

Last October, I wrote in an “Almost DailyBrett” post that agency experience is “PR’s Holy Grail.” My views have not changed. Whether you like it or not, hiring managers and recruiters place an inordinate amount of value on agency experience.

There is some justification for this preference because agency life instills a PR practitioner with the ability to simultaneously serve many masters with differing demands, circumstances, problems and abilities. A healthy dose of Attention Deficit Disorder (ADD), a slavish devotion to documenting every 15 minutes of your life on a billable-hour software spread sheet and a sense of humor are essential to succeeding or at least surviving in this consummate multi-tasking environment.

My “PR’s Holy Grail” post triggered frustration from some readers who tried to crack the agency world, but were turned away because of a lack of…you guessed it, agency experience. The result is a “Catch 22” http://en.wikipedia.org/wiki/Catch-22_ (logic) quandary with no easy answer.

Keep in mind that compartmentalization and the ability to serve many masters is also a very handy skill set in a corporate environment. The advantage in a company setting is that you are dedicated 24-7 to the greater glory and good of your employer. Having said that, your employer comes complete with a CEO and a CFO, a Finance organization, Investor Relations, Corporate Development, Human Resources, Business Units, Manufacturing and how can we forget Legal (You can never forget Legal)? Trust me, they are not always on the same page and many times you have to take sides without making a permanent enemy (easier said than done).

The publicly traded world also features a myriad of rules and regulations including SEC Reg FD that governs what is a “material” event and when and what can be said and to whom. Reg G requires the reconciliation of GAAP (Generally Accepted Accounting Principles) and Pro-Forma or Non-GAAP. If you are working a deal, you will be asked whether the acquisition or merger is accretive or dilutive and whether it is subject to Hart-Scott-Rodino. Your job will demand you understand not only the top and bottom lines, but COGS, gross margin, operating margin, R&D, SG&A, buy-and-sell side analysts.

investorrelations

And required bi-products of corporate life for publicly traded companies are quarterly earnings reports, annual meetings, and CEO letters to shareholders. Ditto for pre-announcements and most likely, restructurings that cost hundreds of jobs at a time. Wall Street may cheer the latter, but conversely the local media and the surviving employees will question management and put pressure on your external and internal communications programs.

So which is better for you, agency or corporate? The short answer is both. You are better off in the eyes of future employers if you offer a background with these two disciplines. The harder answer is which one should come first or whether you should focus your career on one or the other. One thing is certain: They are two completely different worlds and they are not for everyone.

The Time and Place for Bad News

As public relations practitioners we have all learned the following about bad news: It almost always finds a way into the public domain.

We have a choice: We can either manage it or be managed by it.

One of the biggest problems with handling bad news is that executives and their lieutenants in many cases wish for it to just simply go away or be swept under the rug. This is understandable human nature, but it is not good communications policy.

For publicly traded companies, failing to immediately disclose “material” information  only to have it surface later will most likely result in SEC fines for violation of Regulation FD (Fair Disclosure) and lead to a series of field days for the plaintiff’s bar. http://www.sec.gov/answers/regfd.htm

Many partisans want to shoot the messenger and skip over the important message, in this case, Karl Rove, the author of “Courage and Consequence,” www.rove.com. His book provides an important lesson about bad-news management; and in particular a missed opportunity that almost cost his boss, George W. Bush, the presidency. It pertains to Bush’s DUI arrest in Kennebunkport, Maine on Labor Day weekend in 1976.

“Over the years, Bush had told a few confidants about the arrest,” Rove recalled . . . “But Bush was adamant he didn’t want it public . . . Despite our mild encouragement to make it public, Bush said ‘no.’

“At the time, I thought most Americans would decide this was no big deal. Bush had been 30, gave up drinking entirely 10 years later, and incident was far in the past. Nevertheless, we should have brought it up at a time and place of our choosing…”

Ah, the time-and-place rule of strategic communications comes to the forefront once again. You can control the flow of information or have that information control you. The intransigence of the chief executive in this case almost cost him the White House, and conceivably resulted in him losing the popular vote against Al Gore.

The story “broke” four days before the November 2000 general election (Isn’t it amazing how negatives can surface at the most inopportune time for your clients, when through your own inaction you allow someone else manage your bad news?)

“Did this last-minute revelation of Bush’s decades-old DUI hurt?” Rove asked. “Yes, a lot. First it knocked us off message at a critical time . . . Second, we had made a big issue of Gore’s credibility and now we had a problem with Bush’s.”

Even though he admits that it is impossible to accurately quantify the impact of the DUI revelation just 96 hours before Election Day, Rove said if just 2 percent of voters changed their minds that meant that 2.1 million votes went into the other guy’s column. That figure is approximately 4x Gore’s eventual 543,895-vote lead in the popular vote and probably cost Bush four states that he lost by less than 1 percent: Iowa, New Mexico, Oregon and Wisconsin.

“Had he won them, this would have added a total of 30 electoral votes to Bush’s column, which would have allowed him to win the White House without Florida. Receiving a majority of the popular vote and winning the Electoral College by a margin of 305 to 232 would have given Bush a much better start. Of the things I would redo in the 2000 election, making a timely announcement about Bush’s DUI would top the list.”

Engaging in a little Monday morning quarterbacking 10 years later, what should have been the strategy of the Bush campaign team?

●First, convince the principal of the inevitability of disclosure and strongly suggest a management program. Lay out very clearly the consequences and folly associated with the withholding of critical information.

●Second, look at the calendar – the 1999, not the 2000-election-year calendar – for a strategic time and place to make the announcement or to allow the news to miraculously leak. The strategy is to make the DUI arrest ancient news by the time of the 2000 general election.

●Third, figure out the means of disclosure (e.g. deliberate leak, response to a TV interviewer, Drunk-driving awareness event). The 1976 DUI arrest could be seen by the public as a “lessons learned” experience.

Granted that saying all of the above is easier than doing. However, controlling the story on your own terms and dictating the timing is far better than responding to media questions about SEC fines, attorney strike suits or even losing the presidency.

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