Let’s Rein In The Hype About Relationship Measurement

12 Oct

There appears to be a groundswell of support among the measurement cognoscente (a.k.a. metricsexuals*) for the concept of Relationship Measurement.  Much of the early work in Relationship Measurement was done by Dr. James Grunig and Dr. Linda Hon, as published in their seminal 1999 paper; “Guidelines for Measuring Relationships in Public Relations” (get a copy here).  The basic premise of Relationship Measurement is that public relations is fundamentally about managing the relationship between an organization or company and all its stakeholders – employees, communities, customers, partners, etc.  Dr. Grunig and Dr. Hon identified six factors – four characteristics of relationships and two types of relationships – that collectively are highly correlated to relationship strength: 

  1. Control Mutuality
  2. Trust
  3. Satisfaction
  4. Commitment
  5. Exchange Relationship
  6. Communal Relationship

 In my opinion, Relationship Measurement is an interesting concept that has a place in the public relations measurement mix, primarily as a diagnostic tool.  It is not, however, a panacea nor should it be considered the ‘next big thing’ in measurement.  Here’s why: 

  • With Relationship Measurement you are measuring the strategy (how) and not the objective (what).  A company wants better relationships with employees because that probably means their employee retention rates are higher, or their talent acquisition costs are lower, or perhaps because satisfied employees provide better customer service.  They want better relationships with customers because they may buy more products or services and are more loyal.  Relationships are the means to the end perhaps, but not the desired outcome. 

  • There is no proof (yet) that better relationships lead directly to better business outcomes.  While it may be intuitively obvious to many of you that having better relationships is good for the business, the research necessary to demonstrate this has not be done in any broad-scale way of which I am aware.      

  • It is difficult to demonstrate the value to the organization of public relations if we are focused on measuring relationships.  If you go into a CEO’s office and he/she asks how public relations is doing this year and you respond, “Great, relationship strength is up an average of 12% across the board”, you will get a very blank look in response.  Like it or not, public relations must demonstrate how it is helping to drive desired business outcomes if it is to be considered a core strategic function within the organization.   

In the coming months I’m quite sure you will hear more and more about Relationship Measurement.  Read the articles and the books.  Experiment with it and see if it meets your needs.  But please, can we keep a little perspective about what it is and what it is not? Thanks for reading.  I welcome your contrary viewpoints.  –Don B  

* props to Katie Delahaye Paine for this term (see Katie’s blog here)  

7 Responses to “Let’s Rein In The Hype About Relationship Measurement”

  1. Katie Paine October 13, 2007 at 8:42 pm #

    Don, I have to take issue with you on a couple of points. First of all, in this social media age, all PR is about relationships, whether it is relationships with the media, relationships with bloggers or relationships with employees or your community. Its what we do — we manage and hopefully improve our relationships with all our various publics. That’s why my book http://kdpaine.blogs.com/bookblog is called Measuring Public Relationships and why I provide specific measures for each public you’re dealing with.
    Secondly, there is lots of evidence that good relationships yield better outcomes. Read any number of the IPRRC papers like Marcia Watson et al who showed that good relationships result in lower legal costs and lower operating costs or Sandra Duhe who showed that good relationships with communities (CSR) yielded higher overall financial outcomes.

  2. metricsman October 15, 2007 at 2:31 am #

    Greetings Katie,

    Thanks for your thought-provoking comment – I would have been surprised only if you did not disagree with me on this issue. Let me address your second point first. I’ll stand by my statement that their is no “broad-scale” proof or rigorous research that demonstrates the effects relationships have on business outcomes. Sure there are isolated studies, but I would suggest there is not a sufficient body of work upon which to draw definitive conclusions.

    Back to your first point. I am troubled by the statement, “all PR is about relationships” (what about executive counsel, brand building, crisis communications, etc?) because we are in a social media age. Social media is more about about user generated content and peer to peer communities than it is about relationships. We want to get consumers talking to each other about our companies, products or services, not just facilitiating a conversation between the consumer and the company. As you say in your own blog Katie, it’s more about engagement (“When more and more organizations are tying their communications activities to web traffic, donations and member sign ups and calculate ROI directly who cares how many eyeballs they reach? What really matters is the actions the target audience takes. Bye bye impressions, hello engagement. ” – Katie Paine). I believe engagement and relationships are like the rectangle and the square – a relationship is engagement, but engagement is not necessarily a relationship.

    In the social media age, rather than brands reaching out to communities (e.g. a target market), communities form around brands due to common interests and mutually beneficial interactions (e.g. you write a review of a product and I want to read it because I value your opinion).

    I am also somewhat troubled by the premise that PR professionals can somehow ‘manage’ relationships. We sometimes facilitate them, but relationships essentially take on a life of their own without management by PR practitioners. Certainly within social media, individuals would resist being managed by an interested third party. Whether or not a relationship even exists is really up to the consumer – they get to decide if a relationship exists and what the boundaries and rules of the relationship are to be. This dynamic furthers complicates, and perhaps limits, the utility of relationship measurement in public relations. -Don B

  3. Todd Defren October 15, 2007 at 7:13 pm #

    I agree with BOTH of you.

    I agree with Don that CEOs are unlikely to pat PR on the back for “upping relationship strength by 12%” but also agree with Katie that better business outcomes are likely to result from good relationships.

    I hate to quote a competitor but something Richard Edelman recently wrote has stuck with me: “PR should stand for Public Relationships, a transparent effort to advocate our client’s position, supported by depth of content, while offering an open place for dialogue and comment.”

    …Which to me means that PR is morphing into a discipline that helps create & integrate “content” – makes it available to all interested parties – and then hosts, monitors & participates in the ensuing conversations.

    I am not sure how measurable this New World will be… but I offer sincere kudos to bright minds like yours (Don and Katie) for trying to suss it all out.

  4. Jim Grunig October 17, 2007 at 9:17 pm #

    Don,

    Please allow me to make the case that priority should be given to measuring relationships in public relations. You are concerned the value of relationships because you said 1) relationships measure a process or intermediate steps between public relations activities and “business outcomes,” 2) relationships are not a “business outcome” valued by CEOs, and 3) there is no “proof” that relationships improve business outcomes.

    First, you must realize that there are no universal business outcomes valued by all members of management and especially by all stakeholders. Organizational scholars discovered many years ago that organizations experience many competing objectives, depending on the perspective of different people working within the organization and different stakeholders outside the organization. Economists once thought profit was the ultimate objective, but then they discovered that many people in the organization have different objectives. Sometimes growth is more important than profits for CEOs or investors. For marketing people, sales probably is the most important objective. For HR people, it might be employee productivity. For employees, income or career advancement is most important. Outside the organization, communities might value job creation, safety, or support for the community infrastructure. Environmental groups value low pollution. Government regulators value compliance with heath and safety standards. We can go on and on.

    In their book on the “stakeholder approach to management” (as opposed to the ownership approach), James Post, Lee Preston, and Sybille Sachs made a strong argument that different stakeholders value different performance objectives (business objectives in your terms). Successful organizations produce the greatest value for all stakeholders when they develop relationships with the stakeholders that are most important for the organization (determined by how much the stakeholders affect the organization and how much the organization affects the stakeholders), developing performance objectives in collaboration with stakeholders, and then accomplishing these objectives. Therefore, you should be able to see that relationships are crucial both in identifying the most important performance objectives and then in accomplishing those objectives.

    Second, relationships are more than a process objective. Accomplishing the performance objectives valued by all relevant stakeholders is the ultimate determinant of organizational effectiveness, but not all management functions contribute directly, or uniquely, to meeting those objectives. Before choosing an evaluation metric, it is important to conceptualize how and why the function we are evaluating (public relations) contributes to organizational effectiveness. Then we should choose a concept that captures what that function contributes that distinguishes it from other functions. The logic for choosing relationships as a focal measurement concept is the following: Public relations consists of communication activities designed to cultivate a relationship with the stakeholders that affect or are affected by organizational behaviors, policies, products, and services. Organizations that communicate symmetrically with publics are more likely to develop relationships high in trust, mutuality of control, satisfaction, and commitment than those who communicate asymmetrically or not at all. Organizations with good relationships with their stakeholders are more likely to choose performance objectives that are valued by those publics and are more likely to accomplish those objectives than those who have poor relationships. At the same time, there are many variables other than communication that contribute to the meeting of performance objectives. For example, sales are strongly affected by economic conditions, product quality, pricing, distribution, competition, quality of customer service, and on and on. Communication makes a contribution, but to identify that contribution one must control for the effect of all of the other variables.

    We must understand how and why these variables interact to affect sales (or any other performance objective). The result is an extremely difficult, if not impossible, exercise in data gathering. Advocates of market mix modeling believe they have controlled the data in this way, but I am not convinced they have controlled for every relevant variable. I am especially not convinced that they can explain how public relations interacts with other variables to affect sales.

    On the other hand, we can reason theoretically and find evidence to support our reasoning in basic research that explains why relationships are one of the most important
    variables performance objectives. Public relations is the organizational function responsible for relationships. It is not the primary function responsible for the other variables I mentioned. Therefore, we can measure the contribution of public relations most accurately by concentrating on what it does (cultivate relationships) and not concentrate on what it does not do (e.g., increase sales by itself). An accountant once told me that there are three ways to show the value of something: It can increase revenue, reduce cost, and reduce risk. Relationships do help to increase revenue, but if we concentrate only on revenue, we miss most of what public relations contributes by building relationships–reducing costs and risk. In choosing a metric, therefore, we often must step back from the final objective and measure the intermediary variable through which the function we are evaluating contributes to the final objective. I believe relationships are that variable.

    It is also important to choose a metric that makes it possible to use research to improve what we do, not just to “prove” the value of what we are already doing. Many of my colleagues studying relationships have identified what we call relationship cultivation strategies (essentially a theoretical name for what public relations people do) that are most effective in affecting relationship outcomes (trust, mutuality of control, satisfaction, and commitment). If researchers measure both the type of cultivation strategies used as well as the relationship outcomes with which they are associated, they can gather important information that public relations professionals can use to improve their work.

    Third, you said you do not believe there is “proof” in the research literature that relationships are related to accomplishing performance objectives. It’s important to understand that one never “proves” anything in science; that’s a fundamental premise of the philosophy of science. What researchers do is gather evidence that supports their logical, theoretical explanations of how something works. The literature on public relations measurement is notoriously lacking in conceptualization—of explanations of how public relations works to accomplish organizational objectives. It’s also important to recognize that one does not have to “prove” every component of a theory. It is sufficient to deduce likely indicators of an explanation to provide evidence to support it. Thus, it may be true that there are no studies that have measured a direct contribution of relationships to performance objectives. There are few studies that show the affect of any other management function in this way either—especially any that explain why there is such an effect. At the same time, the literature is filled with theories, research, and explanations that provide overwhelming evidence of the value of relationships in meeting performance objectives. You might start with Chapter 3 of my book Excellence in Public Relations and Communication Management and Chapter 4 of its successor Excellent Public Relations and Effective Organizations. The management literature on stakeholders (see the Post, Preston, and Sachs book mentioned above) and on reputation (such as the various books by Charles Fombrun) for additional evidence.

    Fourth, you said one cannot manage relationships. I agree. Relationships are an outcome or management or organizational decisions and behaviors. We can manage processes that, in turn, affect outcomes; but we cannot manage outcomes directly. We also cannot manage reputations, behaviors of others, images, perceptions, or many of the other outcomes used by public relations practitioners to describe what they do. In public relations, we manage the communication behavior of organizations (both from publics to management and from management to publics), which in turn affect relationships. Relationships, along with many other variables, affect performance outcomes.

    Finally, you said public relations people use social media to get people to talk about your company or product. Perhaps. I believe, however, that people are much more likely to talk about a company or product if they have a relationship with it. And, I believe, others are more likely to pay attention to what people say about a company or product when those people have a relationship with it. For example, I recently bought a dehumidifier. My decision was heavily influenced by what people who owned each brand of dehumidifier said about it on the web.

  5. Mark Weiner October 18, 2007 at 12:23 am #

    Let me first identify myself as one of the marketing-mix modeling advocates to whom Jim refers. Surprise Jim: I agree with you.

    In May of 2006, Jim and I had a published debate in IABC’s Communication World (link below) in which Jim represented the merits of relationship-based PR and I represented the merits of business results-based PR.

    Predicated on my experiences with dozens of marketing mix modeling cases, in which the use of sophisticated statistical modeling and advanced technology revealed a link between marketing and sales which strongly favored PR: PR was found to deliver an average return of about $6.00 per dollar invested, mass-market advertising returned roughly $.20 on the dollar, price promotions lost $.25 on the dollar and so on…PR was tops because of its financial return but also because it provided a unique boost to other forms of marketing and enjoyed an extraordinarily slow decay rate.

    But now that we’ve made the PR-to-sales connection, what comes next? When one considers that PR’s decay rate can be as slow as six months before a campaign loses its ability to drive sales after the campaign ends (versus advertising at two weeks and price promotions at less than 24 hours), one must ask “what is six months in the life of a brand?” The answer: “Not much.”

    I’ve come to realize that sales are a very important but fickle measure: the marketing may be spot-on but people are unreliable unless they are motivated to act differently. If you’re like me, you price-shop; you compare; you buy whatever cereal is on sale because if it’s sweet enough your kids will still eat it. What must brands do to preempt the capricious consumer? We must build a foundation of trust, engagement, differentiation and clear value to earn the customer’s loyalty: in a word, we must build “relationships” to drive successful, profitable and enduring brands.

    The debate between “relationships” and “business outcomes” is as moot as the age-old argument of the chicken-or-the-egg: who cares when you know you need both?

    And sometimes, just sometimes, a dehumidifier is purchased not because of their marketing or your relationship with the manufacturer or its advocates: sometimes you simply have a wet basement.

    MARK

    http://cinci.iabc.com/cw/private/pdf/2007/05-06/CW_MJ07PRDebate.pdf

Trackbacks/Pingbacks

  1. Reflections on Relationship Measurement « Proving the Value of Public Relations - October 26, 2007

    [...] Posted by metricsman in 1. trackback The recent debate on relationship measurement in this blog (original post and comments here) was thought provoking to me and I hope to you as well.  I believe there are at least three major [...]

  2. Relationship measurement - hype? « intelligent measurement - October 30, 2007

    [...] There is an interesting debate on measuring relationships going on the Don Bartholomew’s Metricsman blog – Don is saying that he thinks relationship measurement will not be the “next big [...]

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