Positive thinking can get you through the downturn

Dec 31 2008 Agenda

Troubled economic times are ahead, but PR expert Dawn Prentice says we can still thrive.

The government’s stimulus package and shoring up of the banking system are both designed to tackle the worst of the recession and to generate more confidence at a time when we are in great danger of allowing economic doom and gloom to contaminate how we gauge the prospects for our region’s business sector.

While real economic slowdown will lead inevitably to some job losses and business closures throughout 2009, it is crucial for the future of the West Midlands that we don’t talk ourselves into a state of commercial panic.

The greatest danger in a slowing economy is creating a domino effect where panic sets into business practice. Economics is the science of the herd, where perception and confidence are king and queen.

A survey of attitudes towards conduct in public life, which discovered that perception is more powerful than reality, bears this out and teaches us we need to be wary of worsening an already difficult business environment.

We must try to keep our heads and acknowledge that a decade and a half of above-average economic growth and the rebuilding of our public infrastructure and services is something on which to build.

Many public infrastructure projects are going ahead across the West Midlands, some of which are being brought forward to help boost the regional economy.

We should also remember that cities like Birmingham have gone through a renaissance unimaginable 25 years ago and our “re-branded” city will enable us to weather the problems ahead far better than we did a quarter of a century ago.

Most importantly, we must keep our eye on the future, setting in train plans for our economy after the expected recession has passed.

Equally, we should recognise that the UK economy has grown by 50 per cent over the past 11 years and although there has been one quarter of negative growth, economists expect that the economy might shrink by only 1.5 per cent over the next year or so. Clearly this is worrying for everyone interested in contributing to the nation’s ongoing commercial success but we should not dig a bigger hole for ourselves than necessary, with the disastrous effects upon unemployment and stretching the social fabric, as we did in the 1980s.

That is why the fiscal stimulus package announced in the pre-budget report is an important element in minimising the effects of the recession, bringing forward investment plans to maintain employment and reduce the corrosive effects of the recession on families and communities.

There is also much we can do to manage the recession as individual companies, particularly from a public relations and marketing perspective.

Today is a time to invest in the reputation of our region and its commercial sector, underlining the values that have made us successful, stressing the positive as well as tackling the negative.

In a period of economic expansion, reputation management sometimes takes a back seat as new markets open up and competition is for a larger slice of an expanding pie.

In a downturn, businesses have to compete more actively for a smaller, overall cake. This means that successful marketing of our region and its strengths, such as a relatively strong manufacturing base as well as growth in blue chip companies and service industries, is crucial if we are to emerge more speedily and better-equipped from the recession than our competitors nationally and internationally.

Influencing the way in which customers and competitors view how we cope with the recession and our plans for the future should be central to our recession exit strategy too.

Part-and-parcel of this will be our understanding of changed market realities, discovering emerging customer needs and exceeding expectations, and investing in new technology once the banks loosen their credit strings.

These activities should not be overlooked in favour of a short-sighted strategy of reducing overheads. It is far more important for our long-term economic vitality to ensure that core commercial and customer values are at the forefront of our regional business strategy.

So how can public relations and marketing contribute to the way ahead?

Public relations and communications with customers, partners and the general public are effective means of securing a future for local businesses, helping them to stand tall in the sea of uncertainty.

Improved communications with the media during the recession will also enable our region’s companies to get over a balanced view of the economic situation and remind customers and the public that the majority of our companies are viable and looking to the future.

A second area where PR can help is to present a more ethical dimension in commercial activity in place of the “greed is good” mantra that seems to have infected our way of doing business since the 1980s. More co-operative and mutual business models are again becoming popular after a period of caricature as old-fashioned by the so-called masters of the universe.

We now find that building societies, for example, are among the most financially viable lending institutions, since they have a reliable lending base, are not over-exposed to international financial markets and did not buy into risky financial products such as sub-prime mortgages.

Equally, mutual water companies are offering a better deal than the mainstream. And the success of organisations such as the John Lewis Partnership incorporating Waitrose is based on high levels of staff involvement and profit sharing, ethical business practice and quality customer service.

A third way in which modern and more ethical PR approaches can support commercial re-invigoration is by the use of campaigns to illuminate business and product capabilities rather than traditional advertising approaches.

Many businesses are turning their back on costly advertising space through a select number of media channels in favour of professionally managed PR campaigns, which can be far cheaper and generate valuable and credible publicity in a range of publications and broadcast media.

This approach calls for creativity, which the West Midlands has in abundance and reassessing and redesigning how business messages are communicated. This might start with close examination of key PR activities and can lead to a redefinition of corporate mission and values. Many companies are doing this and re-discovering that being “good corporate citizens” covering more ethical business practices, green issues and wider responsibility to society beyond the economic, is sound business practice.

To compete with the likes of China, India and Brazil, we need to look forward to the end of the recession and the long-term commercial future of the West Midlands.

Public relations and successful communications can play an important role in helping our region’s businesses re-define their corporate goals and approaches, emerging stronger to compete in the second decade of the 21st century.

PR can also help us to inject a degree of optimism about our region and to refocus on the future in readiness for better days to come.