Author: Jim Horton

Book stores were among the first businesses to be affected by the internet and it hasn’t changed.  Try as they might, bookstore chains haven’t found the key to unlock increasing sales.  The public has found other means, such as Amazon, to buy books.  This raises the question of whether it is time for the mass merchandiser to give up, throw in the towel, admit defeat?  It would not be the first to do so nor the last.  It takes courage to hang in and tinker with the sales model to see if an answer might be forthcoming.  At some point, however, one will need to admit that the economic proposition is fundamentally broken and the public has gone elsewhere.  The relationship with consumers has gone flat and no amount of work will bring it back.  What will there be to do other than shutter stores and pull back?  The chain will be a shadow of the days when it was great, and it will have to content itself with that.

University of Utah Health Care is pioneering cost accounting in health care and in the process is controlling expenses as it has never done before.  Traditionally, cost accounting was reserved for manufacturing where stop watches and minutely examined activity were the norm.  University of Utah Health Care has brought that standard to medicine, something that needed to be done but no one felt able to getting it accomplished.  In the process, Utah has become the model for other states and health care systems.  Its actions are an unusual but essential form of public relations in that it is giving the public efficient but effective care.  Look for the Utah model to spread to other systems.  It won’t be easy to install in every healthcare system because there might be resistance to working within models of care delivery.  Doctors might rebel, but for those systems that do install cost accounting, citizens will learn for the first time what health care costs.

In the migrant crisis enveloping Europe, Germany has stepped up more than any other country in taking refugees in.  It will absorb 800,000 this year, and it claims it can handle 500,000 a year for several years more.  This is a river of humanity entering a country that historically was standoffish.  The numbers will change the culture of Germany over time and in its diversity, it might start looking like the US.  This augurs favorably for Germany to remain a democracy in which demagogues have little traction, especially if migrants get to vote.  Germany’s stance is an act of country public relations — reaching out to people who have nowhere to go and letting them find food, housing and healthcare.  It should be a lesson to nations like the US, which is trying to seal its border to the South rather than develop plans and policies to integrate Hispanics into the American culture.

This fellow was a master of public relations.  He knew what his customers wanted and he maintained a guarantee of satisfaction that built the company to what it is today.  That L.L. Bean is a household name with an aura of quality is directly due to him.  He should be placed in the pantheon of executives who have made a difference in American business.  And, to think that he built his company in Maine, a state not known for large corporations or successful retailers.  To executives who maintain that public relations cannot be achieved given the marketplace in which they operate, Leon Gorman is testimony that it can be done.

There is a race between the US and China over who can build the world’s most powerful super computer.  The contest has the hallmarks of unhealthy competition and building to boast — something like the space program of the 1960s.  One wonders whether there is a true need for a machine that can crunch one billion billion floating point operations per second.  Nuclear weapons designers say they can use it, but do they actually need all that power?  This is something that will be debated as the machine is built and once started, it is nearly impossible to turn back.  There is a PR boast in having the most powerful supercomputer in the world.  It’s the “We’re No. 1.” chant that at its heart can be empty of meaning.  So, let them build but keep a focus on what such a giant machine is actually used for.  It would be a pity if there are not enough problems to solve at that size and speed.

Sony Pictures is coming out with a film that tells of the discovery of concussion-related illnesses in former National Football League players.  The NFL has only a few months to prepare for an onslaught of negative stories and for league players protests.  The NFL has been dealing with the issue for several years but not with the background of a feature film detailing its denials and eventual acceptance of the facts.  The film will dent its reputation and depending on how successful it is, the public might take away a deeply negative view of the league and its treatment of players.  In fairness to the NFL, it has been trying to teach players how to tackle without smashing helmets and jarring brains, but that might be too little too late.  The NFL has been riding high in public opinion for years.  It might have to regain that reputation after this movie.

Google has an interesting conundrum with its driverless cars.  It seems that they are too safe.  The cars follow traffic instructions exactly but human driver’s don’t.  Hence, the cars have been caught in circumstances beyond their software, such as passing through a four-way stop.  Public relations would call for driver-less vehicles to drive like the public, even if it means bending traffic rules a little.  The cars should act as much as possible as a safe human driver would.  It is an irony that the vehicles have been in fender-benders, not because of what they have done but because of what careless drivers have done to them.  Google is far along in developing the driver-less auto, but it still has a way to go.  The chances are good that it will get there.

A company that can’t get its numbers right has a fundamental crisis of reputation.  Consider Toshiba.  It has delayed its annual results a second time because it continues to find more errors in accounting.  One asks what kind of company is it that has to do that.  It is clear now that Toshiba had been running for years with jiggered books.  This indicates corruption at the highest levels of the company. Indeed, the previous CEO stepped down along with several executives as a result of the errors.  That is as it should be.  It will take years for Toshiba to win its reputation back, and analysts have a right to be skeptical of bottom-line results.  The PR lesson is clear:  Don’t mess with the numbers.

Hillary Clinton is trying to do a better job of explaining her use of a private e-mail server during her time as Secretary of State.  It is a PR gaffe that is haunting her campaign and holding her approval rating down.  The mystery is why she thought she could use a private server anyway when she knew she would be handling classified material.  Be that as it may, she must now deal with the fall-out with federal investigations into her activity.  It is not a comfortable spot to be in, and she must be asking herself why she thought she could get away with it.  It might have been a decision that she barely thought about at the time.  The lesson here is that actions have PR ramifications, especially in the political realm where the press is like a pack of snapping canines worrying a prey.  Clinton will get through this as she has in the past when her actions have raised questions, but the election will tell the final story.

European governments haven’t been ignoring the refugee crisis, but they haven’t come up with solutions for the tens of thousands seeking better lives in the Eurozone.  Maybe now the negative publicity from this tragedy will spur them to action.  It was bound to happen given smugglers who are operating with impunity.  As long as there were no headlines like this, governments could express alarm and try to seal their borders, but a truck filled with dead bodies brings the tragedy home.  The solution is not to barricade countries but to find ways for refugees to stay home.  That is easily written but difficult to do with wars underway that Europe wants no part of.  Yet, the continuing refugee flow may force the Eurozone’s reluctance to engage and get them involved in Syria and Africa.  More incidents like the present one will make neutrality hollow.