Functions of PR
Public Relations are thestrategic function of management. In its core, PR contains different tasks designed to establish and maintain favorable reputation of the company, as well as to build effective two-way communication between the company and its stakeholders. With this regard all functions of PR can be divided into organizational and societal ones. However, such division is somewhat conditional, since very often both of these two functions appear to be strongly interconnected. (Maitland, 1999)
The organizational function of PR is derived from and influences strictly the entire organization. In contrary, societal function of PR has wider space of influence, namely society itself. Thus, some practitioners tend to consider societal functions of PR crucially important, underestimating organizational functions. (Morehead, 1995) Yet, it is not always true, since societal functions sometimes turn to be the outcome of the organizational one. The two typical organizational functions are employee relations and investor relations. Both are key stakeholders of an organization. Obviously, employees are considered to be the main asset of any company, because their performance directly influences the company’s success. Therefore, the importance of employee relations is caused by the necessity to establish effective communication and to find appropriate motivation and stimuli to inspire employees work productively. This function is oftentimes referred to as corporate PR. For instance, teambuilding is one of popular corporate PR tools. Teambuilding favors the team spirit of the collective, stimulates good atmosphere among employees, enhances motivation and thus improves the overall success of the entire organization. (Applbaum, 2004) Another organizational function of PR is investor relations. Similarly to employees, investors are key stakeholders of the company, as they are those people/institutions that provide financial support of the organization and thus also contribute to the overall success of the company. Investor relations as one of organizational PR functions are designed to establish effective communication with external stakeholders of the company. One of the tools used by PR specialists to enhance investor relations is issuing annual corporate report, which includes detailed information on company’s financial performance.(Morehead, 1995; Maitland, 1999) This report facilitates the investors’ understanding of company’s processes and helps to evaluate the effectiveness of its business activity. In such a way, both employee and investor relations influence company’s direct stakeholders, who, in turn, are able to change organization’s normal functioning immediately.
In contrary to organizational functions, the societal functions of PR usually experience prolonged, not immediate effect. Moreover, another important difference between societal and organizational functions is that the former encompass wider space and touch larger audience. The typical societal functions of PR are corporate social responsibility and government affairs. Social responsibility is crucial if the company aspires to maintain favorable image and reputation. With this regard, PR specialists of the company are to undertake appropriate measures to ensure that social responsibility of the organization is performed. The traditional and already scientific to some extent example of such responsibility is Tylenol’s case. When the company Johnson&Johnson –the producer of Tylenol — found out that the medicine it produced caused deaths of several people, its PR department was quick with reaction. First of all, it informed about the existing situation warning customers from buying the product. Such openness was greatly appreciated on one hand, however it was risky for the company, since it put at stake Johnson&Johnson’s further business success and reputation. Yet, social responsibility turned to be more significant, and the company decided to withdraw all the existing Tylenol from the retail sector. The company had suffered severe financial losses, however it gained much more – reputation of a socially responsible company. No wonder, it managed to save many peoples’ life taking such an important decision and informing about this decision the entire society. In such a way, it is obvious that the impact and the scope of societal function of PR is greater than those of the organizational one. However, we can also notice the interconnectedness between the two. For instance, the investor relations include the necessity to disclose information in order to retain the “face of the company”. Thus, we can say that the openness of Johnson&Johnson before the audience in the case of Tylenol was provoked by the desire to ensure good reputation, which is important for the investors of the company as the main stakeholders. Consequently, the information was disclosed to the audience in pursuit to save lives and save reputation of the company. (Maitland, 1999) Thus, the interdependence between the two functions – organizational and societal – is obvious. Moreover, it is even hard to say, which one is more important. The only clear thing is that the scope and the impact of social responsibility is greater than the investor relations. Another societal unction of PR is government affairs. Sometimes, it is also referred to as lobbying. Lobbying own interests at the highest levels of power, the company simultaneously impacts wide audience, all potential and existing consumers. Moreover, this effect can be both positive and negative. For instance, if a large corporation tries to make official authorities initiate legislature to decrease minimum wage, this will not only affect the employees of the company, but general audience as well. This example vividly shows not just the vast scope of impact of societal function of PR, but also again the interconnectedness of organizational (employee relations in this case) and societal functions of PR.
In conclusion, it is important to say that PR functions can be divided into organizational and societal ones. The similarity between the two is that they both impact an organization. The main differences are that societal functions have wider scope of impact and their effect can be somewhat prolonged, not immediate. However, it is crucial to notice that oftentimes organizational and societal functions of PR are so interconnected that one of them provokes and influences another.
Applbaum K. (2004) “The Marketing Era” Routledge, New York
Maitland L. (1999) “Perfect PR” International Thompson Business Press, Boston, MA
Moorhead G. and Griffin Ricky W, (1995) “Organizational Behavior”, 4th ed., Houghton Muffin Company, Boston, MA