Award acceptance speech
Thank you. It is, of course, the ultimate honor to be recognized by your peers, and especially to join the company of the previous Hall of Fame award winners - true legends in the field. I also want to thank my partner for life, my husband Bob. Without his support and love I would be much less of a person every day in every part of my life.
This has been an extraordinarily difficult year for business and, heaven knows, for those of us who try to explain business policies to the public. The continuing revelations of executive greed, outright stealing and cooking the books have raised eyebrows among even the most cynical observers.
After you read about Tyco's $15,000 umbrella stand and $6,000 shower curtains ... Jack Welch's retirement package covering everything but a lifetime supply of dental floss ... tens of millions of dollars of executive loans forgiven at Global Crossing and Quest ... Lucent buying a golf course to entertain customers... respectable banks facilitating energy swaps, perfectly legally, in December and reversing them, perfectly legally, in January ...
... and Arthur Andersen - for so long the – honorable guardian of trust and the credibility of business results – operating at the very crux of our entire economic system – the auditor who testifies that "Yes, what we do is true" – verifying Enron's numbers ... you can only ask, What were they thinking? (Or as an earlier Joe Welch might have asked: "Have you no shame?")
This is hardly the first time we've seen widespread corporate malfeasance, although the scale of this round does leave one breathless. I suspect some of these examples grew from sheer out-of-control envy of the overnight billionaires created during the dotcom bubble. Some executives became confused between the privileges, peccadilloes and excesses available to people who own companies versus the responsibilities of people who manage them. And the ever-popular game men play of "mine is bigger than yours" was applied to compensation until the one-upmanship reached bizarre levels – defying every principle of corporate decency.
It's an Arthur Page nightmare. The brief era of the Imperial CEO has closed with a bang. The ethical standards of every chief executive are suddenly on the line. Chummy corporate boards (so easy for us to manage) are under the most serious attack in decades. Business overall is suffering the lowest levels of credibility in memory (and that's not an easy record to break).
Our stakeholders' actions and attitudes are not a pretty picture either:
Meanwhile expectations for what business SHOULD be doing have never been higher – from bailing out American education to providing a framework for sustainable development in a clean environment to solving the problems of poverty in underdeveloped countries.
When I was a puppy at Bell Labs in the very early '80s and had not yet read Arthur Page, I used to give talks to scientists about the role of public relations in the company. I always started by saying that the goal of public relations was to bring into harmony the policies and practices of the company with the expectations of its publics. I said you could try to change or lower expectations ... or you could change corporate policies ... but ultimately, you had to close the gap and bring them into alignment or there would be hell to pay.
Obviously, the question we've been struggling with in this meeting and back in our offices is: "How do we close the chasm that exists today?"
I have no answers. But I have some thoughts that may be worth considering.
As you know, I spent 25 years at AT&T. Through the best of times and the worst of times. I loved AT&T... then and now. I loved its rock-solid reputation for quality and integrity ... in part because I felt it reflected back on me. It was built on a tradeoff of public trust in return for being allowed to operate as a monopoly, so we had a service ethic baked into our DNA. (I remember as a kid in the PR shop that we were given a list of PR objectives and the number one objective was "to be a company worthy of trust" ... not a company perceived as worthy of trust, but a company worthy of trust.)
In thinking about what was relevant to the challenges in front of our businesses today, perhaps surprisingly, I didn't remember the best of my times at AT&T. I remembered the three worst moments of those 25 years ... three personally miserable, rotten, lousy experiences. They were all tests of corporate character – (which I believe is the core of every crisis that actually threatens the existence and credibility of a company).
My first crisis actually started life as a triumph. A network failure in late 1990 – an unheard-of loss of service in large parts of the country – was a clear threat to our brand. It was traced to a software glitch caused by someone who ran into trouble while changing out software during business hours, when he should have been doing the job sometime after midnight. We fixed it quickly.
At a rapidly called press conference, a reporter asked our CEO, Bob Allen, "Who caused the software problem?" Unprompted, he answered, "As far as the world is concerned, I did." The employees were ready to carry him out of the room on their shoulders. We announced at the conference that we were giving customers a free day of calling on Valentine's Day. And it was all over.
I might add that I was pretty proud to see myself quoted in the WSJ the next day on criteria for handling the crisis: "Tell the truth, tell it fast, take accountability. And give something back."
As the publicity died down, we measured our quality and reliability ratings among customers with some trepidation. They were unchanged ... holding firm at their historically high levels.
In September of '91, another network failure broadly disrupted businesses and government agencies. This one had a mess of technical and human causes. And when a reporter asked one of our senior executives (who is making some headlines today at another company) the cause of the failure, he blamed it on a service technician.
We were creamed in the press and beaten up by the union. But we got the network fixed quickly and our quality ratings were back to normal in short order.
The third network failure – only four months later – was caused by an employee cutting our own cable. It was really ugly. And how about this for bad luck: among other disruptions, we took down most of the FAA communications system at several airports – and the chairman of the FCC, which regulates AT&T, was in the air trying to land at LaGuardia!
A few days after service was restored, our senior team gathered for our annual evening before a Board of Directors retreat. But the subject seemed to be off limits. I finally leaned over during dinner and whispered to Bob Allen, "We HAVE to talk about this."
After dinner, I recall cringing as Allen got up and said to the group: "Marilyn says we HAVE to talk about the service failure." We rather awkwardly left our spouses behind and trooped into another room.
Only then, as we faced each other in privacy, did the pain, anger and shame of what we felt was happening come out. The core of our identity was reliability. Our personal pride was built around flawless service. We were all feeling a terrible sense of loss ... and we were in denial. We didn't see what we didn't want to see. And until WE faced up to the unthinkable truth - that we had a systemic problem – we couldn't act on the root cause.
We subsequently instituted across-the-board, massive, multi-year quality improvement programs that sustained the exceptional reliability standards that characterized our traditional industry leadership.
The public gave us the benefit of the doubt twice because we had a hundred-year record of reliability – but now (to quote that old cliche) we know we have to prove it again every single day. Sadly, no stack of reliability statistics can bring back the automatic willingness to believe that was produced by our incredibly long history of consistent results.
That, it seems to me, suggests the first pillar of trust: Consistency, consistency, consistency of quality for customers. If you don't do what you're in business to do well over the long pull ... nothing else matters.
And if you stumble, you'd better pick yourself up in a hurry and restore that consistency, because it is the core what people believe in when they believe in you.
As we say in the Page Society, it's 90% about doing and only 10% talking about it.
The second crisis that seems relevant today some of you may remember as the "The Monkey Incident." In 1993, a freelance illustrator we often used submitted a very small map of the world to accompany a story in our employee magazine. It showed people in native costumes in various countries around the globe ... and a monkey representing Africa.
It slipped past the editor because it was considered such a minor illustration that the artwork went directly to the printer. The editor herself discovered the problem after the magazine was printed and distributed and she immediately issued an apology. The story spread like wildfire as more and more employees heard about it and became outraged. Our values were on the line.
This was in my shop.
I wrote an apology to all employees. I did a broadcast. But all efforts were quickly overwhelmed as the incident assumed national proportions. In a piece of bad timing of historic proportions, the Congressional Black Caucus opened its convention in Washington on what must have been a slow news Sunday. The Washington Post ran our illustration – enlarged many times of course – on page one – and it was distributed to the hotel room of every delegate. Now the whole company was on trial.
Ultimately, I had to reassign the two top editors and put the magazine, Focus, out of business. It had become inextricably linked to racism. And, I offered up my own resignation to our Chairman, Bob Allen.
In time the fire burned out. But I learned a very personal lesson about accountability for company values.
We were so proud of our record on diversity ... especially in our own PR shop. But on deeply emotional issues, trust is so fragile – protecting it requires extraordinary vigilance. And that vigilance must extend to every nook and cranny of what the world perceives as your sphere of influence.
Today, it seems to me, there is much for the Chief Public Relations Officer to consider as their companies try to rebuild credible business values.
I'm not one of the people who likes to suggest PR should be the "conscience" of the corporation. I don't understand setting us up as holding moral standards that are above our colleagues. But one of our jobs as senior managers is to examine and make explicit the real rules of our corporate culture.
Enron was a model corporate citizen that made the lists of Best Companies to Work For ... and bragged about its daycare centers and philanthropy. But everyone knew the unspoken rules of succeeding at Enron – including that there were no rules if you could bring in the revenue.
While of course we must be key members of the management policy-making team, some part of us must remain the eternal outsider – fighting total absorption into the culture, retaining a clear eye and the ability to challenge the way things are done.
We learn again and again in our lives that people seem to have an infinite capacity for self-delusion ... to see reality not as it is, but as we wish it was. That's our job: to keep a firm grip on reality as it is ... to keep our grip on the employee's view of reality – on the public's view of reality – not what the statement on the wall may be saying reality is. Our job is to bring that news to every policy and decision. That's our contribution to protecting corporate integrity.
My final thoughts on rebuilding trust in business come from my third crisis, which revolved around the announcement of 40,000 layoffs in January 1996, as we prepared to spin off Lucent Technologies. There was a firestorm around the sheer magnitude of that number, which was perceived as the deathblow to lifetime employment among large companies in America. Our employees were in an uproar and morale was terrible.
That was bad enough. But then we had an eerie precursor to today's headlines:
Just one month later, the board gave Bob Allen a raise and substantial bonus. I'll leave to your imagination the conversation I had with Bob when I advised him not to take the bonus (although I can tell you in Arthur Page terms, it was not exactly "calm, patient and good-humored"). Let me state unequivocally, Bob Allen was – and is – an extremely decent human being. And the numbers at that time were chicken feed compared to today, but the reaction was the same when he decided to do business as usual at a time of moral crisis.
When the big guy takes the cash while the little guy loses his shirt, it is seen as failing a test of character. And I can tell you, don't hold your breath for those kinds of failures to be forgiven by the public.
There's no substitute for confident, compassionate leadership that stays in touch with the values of the company and the community. We saw an extraordinary example of a man rise to that occasion on September 11th in New York. Today, the name Rudy Guiliani says it all.
CEOs need not be heroes. And they certainly don't need to be glamorous public figures! But they must always hold themselves to a tougher standard.
We see some role model CEOs doing just that today on the issue of financial disclosure, avoiding not just impropriety but the appearance of impropriety. I say, kudos to them ... particularly since this openness can lead to brutal treatment at the hands of the stock market.
We also see some courageous CEOs responding as best they can to the extraordinary demands of NGOs and concerned activists around the world. Again, I say, kudos to them. It's tricky, if not perilous, when you try to lead for tomorrow.
So what did I learn from my three disasters?
So simple. So difficult. So Arthur Page.
My predecessor, Ed Block, used to quote a grizzled veteran of our department, who contended that the only two qualities you really needed to be a good PR guy were brains and guts.
I don't think it takes an MBA ethics course to know right from wrong. But it takes guts to wrestle many of these problems to the ground and do the right thing.
Arthur Page was that kind of businessman. He was that kind of public relations counselor. The older I get, the smarter he gets.
I know of no principles that offer better guidance for managing our way back to trust and credibility than Page's principles. And I know of no honor I would rather have than to be part of the Hall of Fame that bears his name.