PR

1. PR and the Media
Study Unit 2
Strategic Management and Control of the Public
Relations Function

2. Learning Outcomes
By the end of this unit, you will be able to:
 Understand the importance of stakeholder and reputation
management in public relations practice
 Be able to identify key stakeholders
 Understand the role of relationships
 Be familiar with the role of dialogue
 Understand the importance of trust
 Be familiar with the different stakeholder and reputation
management contexts

3. Learning Outcomes
• Be able to identify and discuss different components in the
stakeholder and reputation management process

4. 2.1 Introduction
• Organisations today are dependent on building effective
relationships with the various groups that have a stake in their
business.
• These groups are referred to as stakeholders and include:
 employees,
 customers,
 Suppliers,
 financiers (stockholders and banks) and
 communities in which they operate.

5. 2.1 Introduction
• Stakeholders can be defined as ‘any group or individual who
can affect or is affected by the achievement of an
organisation’s purpose’ (Freeman et al. 2007).
• Stakeholder management includes aspects of:
 identifying stakeholders,
 determining their needs,
 deciding on appropriate ways of addressing their needs as
well as the needs of the organisation and,
 implementing activities that will address these needs within
an agreed budget (Skinner et al., 2016: 35).

6. 2.1 Introduction
• We therefore will begin our discussion by looking at
stakeholder management in the management process.
• In this unit, we will cover:
• The importance of stakeholder and reputation management
in public relations practice
• Be able to identify key stakeholders
• Understand the role of relationships
• Be familiar with the role of dialogue
• Understand the importance of trust

7. 2.1 Introduction
• Be familiar with the different stakeholder and reputation
management contexts
• Be able to identify and discuss different components in the
stakeholder and reputation management process.

8. 2.2 Stakeholder Management
• There has been a tendency to see the relationship between
an organisation and a particular stakeholder group in isolation
from other groups.
• In these cases, relationships with the community or
employees were seen as separate units, each with their own
public relations activities. This is known as a corporate-centric
process as it does not recognise the interdependent web of
relationships amongst stakeholders (Skinner et al., 2016: 35).
• A more recent view sees stakeholders as interdependent-
constituencies that can heavily be interconnected. It is

9. 2.2 Stakeholder Management
important to note that the web of relationships is not static, but
changes over time and varies according to situations (Coombs &
Holladay, 2010). For example, some relationships at times will be
very active, with strong ties, only to change to being less active
and less involved, depending on the event or needs of the
individuals (Skinner et al., 2016: 35).
• Freeman et al. (2007) developed a basic two-tier stakeholder
map, which identifies two important kinds of stakeholders.
The first are called primary stakeholders, such as customers,
employees, suppliers, communities and financiers, who are
essential to the continued existence of an organisation

10. 2.2 Stakeholder Management
(Skinner et al., 2016: 35).
• Secondary stakeholders, such as activists, governments,
competitors, media, environmentalists, corporate critics and
special interest groups, are affected by the broader business
environment (Skinner et al., 2016: 36).

11. 2.2 Stakeholder Management
• Whilst the basic two-tier stakeholder map identifies
stakeholders at a generic level, it is necessary to also
undertake a more detailed analysis to truly understand the
web of relationships.
• There is an important human element to stakeholders, which
by implication sees stakeholders operating in more than one
group. For instance, an employee may also be:
 a consumer of the organisation’s product,
 a reader of newspapers,
 a union member and

12. 2.2 Stakeholder Management
 a supporter of an environmental activist group (Skinner et al.,
2016: 36).

13. 2.3 Stakeholder management in South Africa
• In unit one, the nature of public relations was defined.
• From this analysis, the public relations practitioner plays an
important role in the:
 identification and
 management of stakeholders.
• Once stakeholders have been identified, several tactics can be
employed to facilitate on-going interaction and
communication to ensure that positive and mutually
beneficial relationships are maintained.
• These activities are part of an effective and successful
stakeholder strategy (Skinner et al., 2016: 38).

14. 2.3 Stakeholder management in South Africa
• The first stage of identifying stakeholders is research.
• This involves asking questions about their:
 profiles,
 their interests and
 understanding whom the stakeholders are.
• Having a better understanding of their actions or behaviour
(and potential behaviour) is the start of a process of building
relationships between the organisation and the various
groups of people affecting and affected by the organisation’s
actions (Skinner et al., 2016: 38).

15. 2.3 Stakeholder management in South Africa
• Understanding behaviour will also provide insight into what a
stakeholder group could do to assist an organisation to:
 realise its purpose as well as
 what behaviour could prevent or help the organisation from
achieving its goals (Skinner et al., 2016: 38).
• Once stakeholders have been identified, it is important to
understand what the group and its individuals believe about
an organisation (their perception).
• For example, how the public views the organisation. In the
instance of negative perceptions, this understanding could

16. 2.3 Stakeholder management in South Africa
result in a series of public relations activities to develop
perceptions and behaviour that are positive and co-operative
towards the organisation (Skinner et al., 2016: 38).
• In some instances, a generic strategy can be developed for a
particular segment of stakeholders. This could involve supplier
communication via a corporate newsletter.
• In a large industrial organisation other segments will have to
be broken down further, with more individual emphasis such
as the identification of various employee groups (Skinner et
al., 2016: 38).

17. 2.3 Stakeholder management in South Africa
• The public relations practitioner will need to develop one
communication strategy for the workers on the shop floor
and another for mid-level management.
• The various strategies should, however, always be focused on:
 the same direction and
 with the objective of meeting the organisation’s goals and
objectives (Skinner et al., 2016: 38).

18. 2.3 Stakeholder management in South Africa
• White & Mazur (1996) identified that ‘public relations and
communication, involves the skilful management of
important relationships and communication with groups of
people on whose support an organisation depends on.
• Today, the trend is for public relations to increasingly become
a social practice, helping organisations fit into their social
environments and working on relationships between
stakeholders to help bring about social and economic change
(Skinner et al., 2016: 38).

19. 2.4 Reputation Management
• Reputation has been defined as the overall esteem in which
an organisation is held: what people say and remember
about it, based on long-term perceptions. It is also a
judgement about how successful it is and the return it gives
its shareholders (Mersham et al 2009, p. 218).
• Charles Fombrun, founder of the Reputation Institute,
described reputation as ‘the perceptual representation of a
company’s past actions and future prospects that describes
the firm’s overall appeal to all of its key constituents when
compared with other leading rivals’ (Fombrun, 1996, p. 72).

20. 2.4 Reputation Management
• Most importantly, the concept of ‘brand’ cannot be thought
about without reference to organisational reputation.
Reputation has to be earned – no organisation automatically
starts out with one, nor can it be built overnight (Skinner et
al., 2016: 39-40).
• Reputation, on the whole,is what others reward you with
based on your performance over time.

21. What are the benefits of a good reputation?
• An organisation with a good reputation:
1. attracts staff and encourages them to work harder
2. retains the loyalty of its customers and suppliers
3. impresses its investors and is well looked after by its
community, who want to keep it in the neighbourhood
4. its profits increase and so does its share price
5. provides a basis for competitive advantage
• The more highly a company is regarded,the more it can charge
a premium for its goods,i.e,Louis Vuitton bags and Apple
computers.

22. What are the benefits of a good reputation?
• A good reputation opens doors more easily.It may easily gain
access to key stakeholders including:
 the government,
 the media,and
 other top organisations with which another organization may
want to forge alliances.
• An organization with a good reputation is more likely to be
welcomed when it expands into new cities and countries.
• Equally,in times of trouble or crisis,stakeholders are more
willing to forgive a transgression from an organization with a
good reputation,making it easier to regain credibility.

23. What are the benefits of a good reputation?
• Reputation is an important strategic asset,and whilst most
organisations readily acknowledge this,they are unsure how
to engage in the process of managing it.Part of the strategic
role of public relations practitioners is to educate managers
about:
 the value of a strong, consistent identity,
 its place in influencing the organization’s image,and
 how aligning these can lead to obtaining a good reputation.

24. What are the benefits of a good reputation?
• NB:
• In the current climate of global financial
uncertainty,organisations will need to highlight their good
reputations more than ever before.
• In order to do this, they will need to communicate their values
and social responsibility initiatives openly and genuinely, in
order to retain the loyalty and respect of their stakeholders.

25. What are the benefits of a good reputation?
• Exercise
• Watch the following video to help complement your theory that you are learning:
• TedX Talks. 2018. Reputation management in the digital era. Retrieved from:
https://www.youtube.com/watch?v=UVU9dOTiX7E. Accessed on: 25 January 2021.

26. Public Relations Tools
• Bergstron, G. 2019. Public relation Tools. Retrieved from: https://www.thebalancesmb.com/what-is-public-relations-and-
how-do-you-do-it-2295982. Accessed on 25 January 2021.

27. Reputation Management
• One may say that using the PR tools above one can achieve
reputation management.
• However, reputation is an umbrella term, and it may be
positive, negative or simply neutral.
• Corporate reputation can be defined as the observer’s
collective judgements of a corporation based on assessments
of the:
 financial,
 social and
 environmental impacts attributed to the corporation over
time (Barnett et al. 2006).

28. Reputation Management
• Davis (2007) identified four different characteristics of
reputation:
 credibility,
 reliability,
 responsibility and
 trustworthiness.
• The more positive these characteristics are in the minds of
stakeholders, the better the organisation’s reputation (Skinner
et al., 2016: 39-40).

29. Case study/Caselet
• Consider the stakeholders of Comair Limited in the diagram
on page 36 of your prescribed textbook. Distinguish who are
internal or external stakeholders.

30. Online Reputation Management
• To millions of people around the world the Internet is a tool of
choice in finding organisations they wish to interact with.
• Of these, many use the Internet, particularly the Google
search engine, to follow up on products or brands that they
first learn about offline (Jones, 2008). This has clear
implications for reputation management.
• Social media now allows millions of ordinary people to
comment on the products and services of organisations
(Mersham et al. 2009, p.225).
• In addition, a significant minority of users are engaged in
forms of online content creation, maintaining their own

31. Online Reputation Management
websites and keeping their own blogs (Skinner et al., 2016: 40).
1. How are organisations planning for this behaviour and the
implications for their organisations?
2. What sort of strategies do they have in place to support and
manage this interactivity?

32. Reputation Management
• Here are four key questions we need to ask:
• Is the organisation being found online?
• For which search phrases is the organisation being found
online?
• Are they positive or negative?
• For which search phrases is the organisation not being found
online? (Skinner et al., 2016: 40).
• RezStream. 2015. 3 influential elements of successful hotel reputation
management. Retrieved from: https://www.rezstream.com/blog/3-influential-
elements-of-successful-hotel-reputation-management. Accessed on: 25 January
2021.

33. Reputation Management
• RezStream. 2015. 3 influential elements of successful hotel reputation management. Retrieved from:
https://www.rezstream.com/blog/3-influential-elements-of-successful-hotel-reputation-management. Accessed on: 25 January 2021.

34. Conclusion
• One may conclude that stakeholder identity is at the very
heart of successful public relations management.
• You need to know:
 who your stakeholders are,
 what their needs and aspirations are and
 how you can meet them in a mutually beneficial relationship,
built on respect and trust.
 In contrast, reputation therefore, has to be earned and indeed
nurtured over a period of time.
 It can be easily destroyed by actions of individuals at times of
crises, but if the groundwork has been done, it may be that
the organisation can come out of a crisis even stronger.

35. Conclusion
• The public relations practitioner’s role is to be a guiding force
in supporting all the efforts to achieve an organisation’s aims
and objectives in an ethical context

36. Revision Questions
• Answer the compulsory revision questions below.
a) What are external stakeholders?
b) What are internal stakeholders?
c) Why are stakeholders important to an organisation?
d) In your opinion argue if you think public relations should be
located internally at an organisation and be a full-time post or
external to the organisation by using a consultant. Explain
your answer by discussing some advantages and
disadvantages.

37. Revision Questions
e) Is Public relations marketing?