Is AIG something that PR students and professionals are discussing a lot right now? What lessons can students of PR take away from this debacle over the bonuses?
Excellent question! I’m not in PR, though I’ve worked with PR people on product teams and on conferences. I’d say that it is probably a good idea to figure out what the public perception of your industry segment is. I don’t get the impression that investment banks and investment bankers realized that they went from gods to monsters in a very short interval. Someone from PR should have told them. I don’t read the WSJ but I do read the Times, and I’ve not seen any messages from the banks PR departments acknowledging that they might have screwed up. What has been coming through is how hard it will be for the bankers to survive without their nannies. A lot of that may come from those already gone, but there has been no countervailing humility that I’ve noticed.
One big lesson-- change the way you pay people. And, for Og’s sake, if it’s really an essential part of the person’s salary, and not merely an extra incentive, DON’T call it a bonus. Or, eventually, heads will roll.
Nobody would get worked up over pay that was caled “Commisions”
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Stay ahead of the story. Don’t be reactive. If you ARE behind on the story work HARD to get ahead and control it.
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Realize when your client MUST go public with abject apologies.
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Know your client and their vulnerabilities and work, ahead of time if possible, on what happens when the worst gets out.
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Know when to fire your client to avoid being tarnished yourself.
Pick your “fights” carefully when you can.
Know your facts - the good points AND the Oh Shits.
Don’t ever let your pay be called a bonus. Call it a commission, call it a salary, call it bounty, but NOT a bonus. Ever.
30 years ago, the common name on the street for those with brain impairments was that they were mentally retarded, there was no negative connotation associated with that until people used it as a slur. A retarded spark in an engine for example is a statement of fact and not a negative.
Then, in order to remove the stigma associated with that, it was changed to specially gifted. Likewise, there are many other examples but the fact remains, “in this case” you can give the dog a new name, but commision, wherein someone rakes in millions will also be given the new stigma once the public catches around to it.
What does AIG have to do with Puerto Rico anyway?
Bingo. Honest to God, I believe that this is the crux if it, and no fact will no change the story that has resonated and stuck to the wall: the greed-heads who decided and drove the strategy that drove AIG into the ground are now receiving performance bonuses from taxpayer money. That’s the story, facts be damned.
This should have been called “retention compensation” or maybe “key employees who weren’t part of the horrendous decision-making body that created this mess compensation.” I’ll leave it to the real PR guys to come up with something catchier. It is virtually impossible to have a rational discussion about this since the story emerged with the word “bonuses” in the headline. Look around this board if you want some examples.
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don’t use the phrase “the best and the brightest” to refer to the people in a department who fucked up so badly as to jeopardise the world economy.
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don’t try to justify bonuses for “the best and the brightest” who fucked up so badly as to jeopardise the world economy on the basis that we need to keep them to continue working their magic.
It’s a bonus. Only an imbecile would be fooled by any euphamism.
Maybe a good PR lesson would be to keep that shit under wraps? It’s pretty obvious that the public is going to be pretty upset over large payments to people in a company that needs taxpayer money to stay in business.
The thing to understand is that those people probably don’t care about public opinion. I mean if you were getting an x million dollar bonus from a company that will probably not be around in a year, would you care what some jerk on Main Street thinks of it?
Actually, while I’ve been following the bonuses story with only half an ear, it sounds like the term bonus is the euphemism and that’s not really what the money was. Contractually-obligated compensation isn’t really a bonus.
“End of year, lump sum salary payment” would’ve worked better.
Yeah, anything but ‘bonus’ actually would have worked better there. In the mind of the voters a ‘bonus’ is something one receives for good work above the expected. Combine that mind-set with the downturn in AIG’s fortunes and we have a PR disaster that could unravel the entire thing, perhaps even leading to 100% ownership of AIG by the federal government as a means of damage control. Urgh.
All bonuses are contractually obligated in a sense, but most are contingent on corporate performance.
Was PR even involved in this? Or did they all get fired already? I think PR could have told these guys that putting barbecue sauce on a piece of crap doesn’t make it any more appetizing. I am surprised that I haven’t seen articles calling this the biggest PR fiasco of this new century.
And THEN would have got fired. Y’see, the AIG/BoA/Citi/ etc. gang to this day do NOT believe they did ANYTHING wrong: We The People are the ones who are reacting irrationally and emotionally to being hurt in a way we do not really understand (and to be fair, yes, many of us ARE doing just that) and why should they “accept guilt” if they did nothing wrong?
Like Voyager and Johnathan Chancesaid, part of the issue is that for most of us, “bonus” is either a conditional reward or else a nominal token of recognition, that comes only if we’ve had a profitable year. The public may have tolerated an EARNED additional compensation, as in a commission (provided it were really an earned commission, i.e. proportional to the revenue generated by the division/branch/'team/individual); but that someone may be** guaranteed **hundreds of thousands or millions for what looks to the public like just showing up in a failing company rubs them the wrong way.
Not just in a failing company. That would be annoying enough. But in a massively failing company whose actions are seen, in large part, to be directly behind wiping out the savings and devastating the economic outlooks of millions of Americans. And that destructively-failing firm was also only kept in business by taking even more money out of taxpayer pockets to keep it afloat, and then with that very money that they took from us, they used it on “bonuses”, which lots of folks are sure will go to pay for Swiss chalets that you can ski in/ski out of, hookers, and blow.
Not much of that would have been ameliorated by calling their bonuses something else, but it would have helped to change the perception that “Hey, these motherfuckers ruined the economy by their greed and selfishness, and now they’re using my money that the government gave to them in order to give themselves UnBirthday presents that they definitely don’t deserve? Rabble rabble rabble!!!”
You might advise your clients that it could be a bad idea to use any taxpayer funds for political campaign contributions.
And don’t then sue the federal government for more money.
They did a good job calling them products in the first place but that was a long time ago, and their game seems to have dropped since then. But if your business model involves the following kind of scenario:
City A needs repairs on their major bridge, but the city doesn’t have enough money right now and the governor won’t raise taxes to cover it because he doesn’t want to be seen as the tax-raiser, so you gather a consortium of investors to pay for the bridge repairs, then raise tolls to get back your original investment and then keep raising them to pay off the investors with a nice billion dollar profit, so that the public gets their bridge but end up paying three times what it should have cost,
If that’s your business model, then you should just keep it under wraps, and if people come asking questions you should point out something shiny and hope they go away.
When you’re talking about annual compensation being taxed for the top 2% of wage earners in a year, don’t cry the poverty card. Ya, I don’t care if in the old economy investment bankers made a lot of money, once they start taking billions in bail out bucks to avoid bankruptcy from the 98% of Americans that will never ever make that much money, quitchercryin’ about how under paid you are.