If the effectiveness of communication programs is to be measured in economic terms, public relations management must not be viewed as a technical task, but defined in terms of a mission that is socially defensible, organizationally relevant, and quantifiable.
The value of a communications program should be demonstrated by determining its contribution to the effectiveness of an organization, rather than by attempting to make an accounting of how efficient the communication program is. They explore how useful several approaches to organizational effectiveness can be in explaining the economic contribution of communication to an organization. William P. Ehling, a public relations expert who estimated the value of public relations and communications, cites the following eight step process from Mark S. Thompson’s book Benefit-Cost Analysis for Program Evaluation:
– Identify the decision-makers and their basic concerns
– Identify alternative programs of action available to the decision-makers
– Identify costs, including both direct and indirect
– Assign monetary values to the program’s effects
– Discount if effects occur at different times
– Take into account, when appropriate, the distributional equity effects
– Aggregate and interpret the resultant valued effects
One way of measuring the value of effective communication is to measure the cost of poor communication. Good communication builds relationships with strategic publics, thus helping an organization manage its interdependencies with these publics. The leaders of an organization should be aware of the amounts at risk from increased government regulation, litigation or activist activity. An organization can suffer actual losses or lost opportunities when stakeholders exercise ‘countervailing power’, the ability to prevent an organization from implementing its programs.
In reality, too many leaders are claiming their reputation, too many of them are overshadowed by the fact that their sales increase, their profit is going up. They do not even realize by the time the organization raises to its peak, the employee morale is critical. They view relationships as a matter of dominance or subjugation, they avoid taking responsibility for actions, they divide the world into ‘good guys and bad guys’, they act out of tradition or habit and view relationships as competitive and individualistic.
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