Tomorrow's Business: A shake-up at the top of corporate communications?

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By Simon English

A shake-up at the top of corporate communications?

For years, medium sized agencies have complained that boards are timid in the hiring of PR advisers.

Directors would pick Brunswick, or similar, over cheaper rivals just on the basis that no-one would fire them for doing so later.

IBM and Goldman Sachs won business for the same reasons.

Is this changing? Well, the medium sized players say it is, which may owe something to wishful thinking.

But. Last week we reported on Headland’s purchase of Bladonmore, a deal which takes it into America, among other benefits.

The other day, Vigo Consulting was named agency of the year.

Vigo is pleased and good for them, though rivals may not think it means that much. Awards come and go, and we don't know who else entered. (Hacks don't notice or care about these awards.)

What does Vigo think it means?

Damian Reece of Vigo tells me: “I think what the award shows is that you don't need hundreds of people to run an international agency anymore and that when it comes to strategic communications and reputation management, quality and quantity are not the same thing.”

By this telling, the global agencies have a bloated cost base which makes the price of their advice too high, and clients are noticing.

So, just when private equity thought it was a good idea to consolidate PR firms into a few global behemoths to get efficiencies of scale, those efficiencies are now available to all and are being replicated through AI and other digital innovations.

Critics of the very biggest PR firms say they are only protected by the inertia of Boards, which is ironic given that Board inertia is one of the biggest reputational risks a company faces.

It would be nice if this were true, if there were a pending entrepreneurial led revolution coming at the top of corporate comms.

But that would require Boards to stop being so risk averse, and you don’t get appointed as a non-exec at a FTSE 100 company if you are the type to vote against decisions made by colleagues.

The easiest thing to do after a PR review – not the same as the best – is to reappoint the devil you know.

Reece continues: “If you accept the premise that the reputation of business remains poor, you have to ask yourself why? There are many reasons and poor corporate conduct is one.

But the sad fact is that too many businesses continue to get the same old advice from the same old people which hasn't changed in decades - literally.”

Some of those same old people – I know from glasses of wine in City bars – are bored out of their brains.

Where they used to have creative agency, they are now trapped in huge bureaucracies.

If the overdue shake-up Vigo and others predict is real, perhaps the PR people might even welcome it.

Please send candidates for press release of the day to:

Simon.english@roxhillmedia.com

Questions for tomorrow

1) How bad are the latest insolvency figures?

2) Does Imperial Brands see signs of vaping falling out of fashion?

3) Who made money from the gilts sell-off?

4) What does Great Portland Estates hope for from the Budget?

Rolling stories

1) Hotels and shops to be hit by fresh Reeves tax raid. City AM

2) The remarkable story of Canary Wharf’s renaissance. The Standard

3) Gilts stabilise after tax u-turn sell-off. FT

4) Thames Water bidder says it is offering £1bn extra cash injection. Guardian

THIS WEEK

Roxhill Meets... Patrick Galbraith, Environment Correspondent,

The Telegraph

When: Wednesday 19th November at 10.30am

Where: Myo St Pauls, One New Change,

London, EC4M 9AF

Buy Tickets

Clive Black of Shore Capital lets rip on government failings here, in particular the impact the politicians are having on consumer confidence.

“The supposed 'grown-ups' are a national disgrace & international embarrassment. Quite what British shoppers and the boardrooms of consumer retail firms, never mind the electorate, make of the total incompetence in Whitehall remains to be seen. Weak October retail sales can partly be attributed to yet another multiple motorway pile-up of a pre-Budget process, don't they learn? For the UK consumer trade…uncertainty abounds amongst a chaotic policy environment that simply is not acceptable.”

What do you really think Clive?

SEE PRESS RELEASE

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Toby Green has recently been appointed Assistant UK News Editor at the Financial Times.

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