Fed Eyes Social Media

Social Media Map

Navigating Social Media (Photo Credit: Flickr, Mark Smiciklas)

The Federal Reserve Bank of New York, largest of the 12 regional Reserve Banks, has issued 44 news releases so far this year.
 
The subjects have ranged from economic updates and special studies, to the appointment of new officers and board members, to a little publicized announcement last March of a blog launch, Liberty Street Economics–serving as a platform for the Fed’s Research and Statistics Group to share personal insight on current issues, as well as engage in direct dialog with a “broad online audience.”
 
In addition to pushing information out, however, the New York Fed–also in a scantly publicized notice–now wants to know what is being said about it on social media, and they are seeking bids from monitoring companies to help them.
 
Fed officials, as recently reported by Walter Hamilton in the Los Angeles Times, want to “get a better sense of the relevant concerns and discussions that are taking place in the public domain in order to enhance and improve…the role it plays in supporting the U.S. economy.”
 
We advise our clients, almost daily, that it is critical to know what their constituents are thinking and what they are saying, if for no other reason, to react appropriately and address concerns.
 
For the Fed, certainly much of the findings will undoubtedly be negative because of the state of the economy.  But oddly, word of the Fed’s move has exploded in the political blogosphere, firestorm style, with fears of how the information will be used and talk of Big Brother.
 
My goodness! Calm down, fellow bloggers, this is no big deal. It’s just old fashioned market research being applied to a new medium.
 
Ironically, it’s amusing to note that in Hamilton’s coverage, he quoted an executive at New York-based software company ConvergeEx Group, which recently issued a press release about a new product, Spectrum, offering the “power of dark liquidity,” and “the benefits of executing in a diverse array of dark venues” and enabling users to trade cash neutral in the dark.”
 
Even the best of monitoring companies won’t likely penetrate that.

 

Roger Pondel, rpondel@pondel.com
 
 

On Kindness and Leadership

Most of us want to work for a boss that is kind and fair.  Paradoxically, however, when looking for a leader we also equate kindness with weakness, and selfish aggressive behavior with strength, according to a recent study conducted by researchers at the Kellogg School of Management, Stanford Graduate School of Business and Carnegie Mellon University’s Tepper School of Business.
 
The study said that being selfish makes “you seem more dominant and being dominant makes you seem more attractive as a leader.”  And, “people who are generous or altruistic can appear weak or gullible.”
 
This is an explanation, at least in part, of why we get corruption.  People who are more likely to be moral, kind and pro-social are least likely to be elected to leadership roles, and the likelihood of corruption and malfeasance increases because we have the wrong people in positions of leadership.
 
Indeed, these findings on how we perceive dominance and weakness (when it comes to leadership) are likely what is behind the frustration and anger of the “Occupy Wall Street” protesters.  The news of outrageous salaries and bonuses for CEOs and the government using taxpayer money to bailout big banks is all too familiar, while many average citizens cannot find work or have to work more for less pay.
 
Joe Dear, chief investment officer of California Public Employees’ Retirement System, said recently that people are waking up to the fact that the game appears to be rigged. A helpful first step for fairing up the game may be to begin viewing kindness, fairness and altruism as strengths in business leaders, and selfish behavior as reason to look for a new CEO.

 

PondelWilkinson, investor@pondel.com
 
 

Rock Star CEOs

Steve Jobs

Steve Jobs (Photo Credit: Flickr, tsevis)

This week Apple, Inc. founder Steve P. Jobs passed away from pancreatic cancer.  He was 56.
 
While Jobs’ death sparked a global media frenzy, his passing did not go totally unexpected.   In fact, the former Pixar CEO had a couple of health scares in the past, even taking a leave of absence in 2009 when he underwent a liver transplant.   During that time, Apple shares dropped nearly three percent, slashing roughly $10 billion off the company’s value.
 
Apple’s stock fluctuated on Thursday after Job’s death was announced but held positive at the close.  Apple’s stock today closed down a little more than two percent.  News on the street, however, is that investors already factored in the fact that Steve Jobs wasn’t going to be around at Apple for the long run.
 
The trouble with iconic executives such as Steve Jobs, Warren Buffet, Richard Branson and Carly Fiorina is that they’re connected too closely to the company’s brand, putting the organization at risk if they abruptly leave or resign.  In addition to stock fluctuations, celebrity executives may affect business decisions as in the case with Fiorina who stepped down as HP’s CEO in 2005 amid a firestorm of negative media coverage.
 
The consensus of business experts is that CEOs are best to avoid the spotlight and focus interviews on the company rather than themselves.  This may be true of Jobs, but his celebrity always took center stage and he was seen as the true heart and soul of the company.
 
The transition has begun as Tim Cook officially took the reins from Steve Jobs last month.  Maybe he was being groomed all along?  Who knows? The reality is that companies with rock star CEOs need to take heed and start planning some kind of legacy strategy to circumvent any potential future hiccups.

 

George Medici, gmedici@pondel.com
 
 

Ripe for Review

Cantaloupe

Ripe for Review (Photo Credit: Flickr, )

A few weeks ago, a cantaloupe farm from Southern Colorado became the center of attention, but not the kind of attention a small organization would opt for. A listeria outbreak linked to the farm caused 72 illnesses and 13 deaths, according to the Centers for Disease Control and Prevention. This outbreak has been deemed the deadliest in the United States in more than a decade.
 
Disasters such as these serve as important reminders to make sure crisis communications plans are ready to go. Following are some ideas to keep top of mind when starting or reviewing that plan:
 

  • Create a messaging platform – A number of important points should be put together to combat any questions brought on by the media and any customers, such as addressing the issue at hand, explaining what the company is doing to settle the issue and move forward in a positive direction, etc.
     

  • Provide constant updates on new information – As more information is gathered and received, every bit should be readily available and shared with the public.  
     

  • If needed, gather third party support – If there are holes in the information for the crisis, hire additional support, such as investigators. Do everything you can to find out all of the little details so there are no missing pieces to the puzzle.
     

  • Gather support from the industry – If this is an issue comparable to the cantaloupe saga, it will affect other players in the industry. Communicate with other companies in similar spaces who can help communicate information about the issue as well.
     

  • Hire a communications firm with experience in crises – There are many firms that focus extensively on crisis management and can help companies mitigate the damaging effects of a crisis.

 

PondelWilkinson, investor@pondel.com
 
 

To-Do List: Investor Day

Riviera Country Club

PondelWilkinson recently organized an investor day at the Riviera Country Club in Los Angeles (Photo Credit: wikipedia.com)

Fall is upon us and the scent of a fine buffet meal is in the air.  Amid the cacophony of seasonal investor conferences and roadshows, another IR programming stalwart is vying for investors’ time – the Investor Day.
 
According to a recent National Investor Relations Institute study, more than two-thirds of members surveyed host some sort of periodic analyst or investor day.  While the data somewhat favor the larger companies (who typically have more analyst coverage), these events are becoming increasingly popular among companies of all sizes. Two of my colleagues recently ran an investor day at the well-heeled Riviera Club in Los Angeles; two others are still recuperating from an over-subscribed investor event in New York that included the NASDAQ closing bell ceremony; and several of us are in the throes of supporting a third analyst and investor day that will include on-camera clapping for the morning bell at the New York Stock Exchange, as well as a media relations component.
 
And while the extensive planning and coordination might warrant a strait jacket, once completed, the effort and investment is almost always worthwhile.
 
The reasons for holding investor days are varied, but typically fall into the following categories:
 

  • To showcase the depth and breadth of the management team and provide additional insights into company-driving businesses;
     

  • To unveil a new product, product line, or company initiative;
     
    To reveal company financial targets and the roadmap toward achieving them; or
     

  • To introduce a newly acquired company or business and its executive team.

 
While company and even investor budgets are still tight, the purse strings seem to be loosening.  But to ensure actual attendance matches up with a “confirmed” list, companies should think hard about creating a compelling event that is not easily bumped from the calendar.
 
In addition to details outlined in the NIRI survey, consider the following when planning for your next Investor Day:
 

  • Issue a Save-the-Date notice well in advance;
     

  • If you are hosting the event at your company headquarters, try to tie it in with a local social event  or facilities tour that might help to bolster attendance (many attendees at the event going on right now will play the famed golf course afterward);
     

  • Construct a theme that creates some personality for the event and helps to unify the message for all of the presenters;
     

  • If the timing works in your favor, perhaps issue a splashy news release on the day of the event outlining your key message points (don’t forget to think about your media campaign and consider offering news as an exclusive to appear on the day of your event);
     

  • Consider inviting a guest speaker(s) such as a customer or industry guru (or show a video of the same) to put your story in greater context; and,
     

  • Make the best use of management’s time together and schedule a company planning session with the assembled division heads the day after your event.

 
Of course, I would be remiss in not casually mentioning the merits of utilizing a seasoned IR advisory team – even on a project basis – to help maximize the investment made for this important annual event.  With the scars to prove it, a team such as ours has almost seen it all – we know what works, what’s compelling, and, of course, which hotels serve the best buffets.

 

PondelWilkinson, investor@pondel.com