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Learn from the World’s Biggest Companies

I touched briefly last week on the present controversy at Hewlett-Packard, and before the “ink” was even dry on my column, the company had swung into action.

Earlier this week, Hewlett-Packard Chairwoman Patricia Dunn agreed to give up her post next January, stepping aside in favor of Chief Executive Officer Mark Hurd. Dunn will remain a director at Hewlett-Packard, though that may change if the California Attorney General decides to hold her responsible for the apparently illegal actions of investigators hired by Hewlett-Packard. Bad investigative tactics aside, what struck me about this whole incident was how quickly it evolved.

On September 6th, Hewlett-Packard disclosed details of its internal investigation into media leaks in a regulatory filing. Six days later, Dunn was out. In between, the California Attorney General and the Securities and Exchange Commission announced inquiries into the matter, and pretty much every talking head on the planet made their views known, be it on CNBC, CBS, Fox News Channel or in the pages of a newspaper. Newsweek even chose the Hewlett-Packard scandal as its cover story.

Ignoring the obvious condemnation some people inside the company deserve, Hewlett-Packard itself deserves credit for handling the situation quickly. The organization’s mechanisms kicked in – from the board of directors to the public relations department – and made sure that the scandalous issue did not bleed over into the rest of the business. (The stock is currently trading around a six-year high.) Hurd fired off a letter to the company’s employees explaining the situation, and journalists I spoke with this week said that Hewlett-Packard’s public relations office was handling the matter admirably.

“Some other companies I cover would have handled the situation poorly, but I think HP’s PR team has done a fine job,” one veteran technology industry journalist told me. “It’s a tough time for those people because they only know what they’re told from the top.”

Hewlett-Packard’s flexibility in the public relations arena, no doubt, has something to do with scale. With over 150,000 employees worldwide, the company can afford a well-staffed public relations department. Nonetheless, ten mediocre PR people will find it difficult to accomplish what one very good PR person can. And under the most trying circumstances, a mediocre PR professional is the last person you want dealing with a media that itself is part of the story.

The most vital action Hewlett-Packard took over the past week was to keep the public informed through press releases and interviews. Unlike other companies in the throes of a scandal, Hewlett-Packard made its people available to the media, and kept the public abreast of action, even when its board of directors met and came to no decision on Sunday.

There is little doubt in my mind that Hewlett-Packard chose the course of action it did based on the fact that the scandal involved spying. In other words, Hewlett-Packard knew that any further obfuscation of the facts would only hurt the company further, thus being as transparent as possible was in its best interests. Still, it’s an important lesson, and one many public relations people learn too late. If you’ve got nothing to gain from being evasive, you’re only going to harm your cause by being just that.

On the opposite end of the public relations spectrum this week is Viacom, which recently replaced its chief executive officer. The media giant’s autocratic Chairman, Sumner Redstone, decided that after eight months on the job, Tom Freston was not working out. Pretty much everyone else – analysts, investors and pundits – disagreed.

Redstone did not win any points on a conference call to explain the decision, and more than a few people threw back words that came out of Redstone’s mouth less than a month ago.

“Tom [Freston] and the Viacom management team have an unmatched track record of repeatedly and successfully leveraging emerging technologies, which gives us great confidence that we can continue to outperform the competition in this rapidly changing environment,” Redstone said in an August 9th press release.

My, how quickly things change!

Unfortunately, Viacom is an organization where everything comes from the top, leaving the public relations people little room to maneuver. Just last month, out of nowhere, Redstone publicly ended the long-standing relationship between Viacom’s Paramount Pictures and movie star Tom Cruise. The announcement, made by Redstone without Paramount’s knowledge, was a bombshell and made Cruise look good for the first time in months.

While Redstone can probably teach us a lot about business, the man does not know a thing about PR. You simply do not stab someone in the back in public like he did to Freston, and you don’t make important announcements at your whim without considering the fallout and public relations implications. While PR is often reactive, as was the case with Hewlett-Packard, it is more often proactive, and Redstone’s actions show a distinct lack of planning.

Many of us learn PR lessons each day through our own work. Keeping an eye on what some of the world’s largest organizations are doing can also be educational. There may not be such a thing as a free lunch, but you can get a free course in PR 101 just by watching the news.

This article, written by Ben Silverman, originally appeared in PR Fuel (http://www.ereleases.com/prfuel), a free weekly newsletter from eReleases (http://www.ereleases.com), the online leader in affordable press release distribution. To subscribe to PR Fuel, visit: http://www.ereleases.com/prfuel/subscribe/.

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