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Entrepreneur Magazine recently published "Mark Cuban's 12 Rules for Startups."  Many of the rules provide a common sense approach to starting a new business.  But the eleventh rule made me woozy.

Here's what it said: "Never hire a PR firm." You can certainly understand my bemusement when reading these words.

Cuban qualified this rule by saying that PR folks are calling and emailing reporters and editors when, in fact, the founders of companies should be calling and emailing the same reporters and editors "who will welcome hearing from (them) instead of some PR flak."  Gosh, that's harsh.  I mean, calling PR folks "flaks" is the equivalent of calling a fresh piece of rye bread a "crouton."

Indeed, Cuban is talking about startups and not established companies, and hiring a PR firm isn't always a top priority when eating and keeping the lights on are hard enough.  But if you cannot afford to hire a PR firm, you should probably ask a flak friend for some pro bono advice before banishing their firms altogether. 

Here are my top six reasons why:

1.       First impressions matter.  If you send a lackluster pitch or sloppily written email to any self-respecting reporter or editor, it's going to be tough getting their attention.

2.       It takes a lot of time and energy to cultivate media sources, so determine whether you have extra time to contact editors and reporters with punchy and seductive things to say.

3.       Crafting your own messaging (basically how a company describes itself to the public) is about as simple as staring at yourself in the mirror and describing what you see.

4.       It's not easy communicating a calm and cohesive message to employees, investors, customers and others who rely on your services when you find yourself in the midst of a crisis.  That's when PR pros really come in handy.

5.       The number of professional reporters and editors is shrinking due to consolidation in the media industry.  That means startups and established companies alike are responsible for generating their own buzz, and at the very least, communicating with important constituencies.   That's what PR firms do.

6.       And finally, always question someone who criticizes the value of a PR firm when they themselves are billionaires, not to mention shameless self-promoters.  From the Washington Post:  "He (Cuban) is on television or the radio marveling at his charmed existence ... 'When I die, I want to come back as me,' he likes to say..."  Unfortunately, we're not all Mark Cuban.

-- Evan Pondel, epondel@pondel.com

New York Times advertising columnist Stuart Elliott may finally have given the public relations industry some needed street cred. His November 20th bylined article, "Redefining Public Relations in the Age of Social Media," discussed why the Public Relations Society of America has embarked on its own campaign to change the definition of "public relations."  

This blogger over the years has had several conversations with Stuart about the importance of public relations (PR) long before this recent column, prompting the need for more coverage on the industry since it has become more integral to the marketing efforts of brands and organizations.

The existing definition, "public relations helps an organization and its publics adapt mutually to each other," has been around for nearly 30 years.  You'd be surprised at a few of the suggested changes being floated around, some worse than others.

Quite frankly, nothing has changed.  Public relations still helps organizations "talk" to their constituencies.  The only real change is the way these organizations communicate with key audiences since the rise of the Internet.  Social media is just a new vehicle or another medium, whether it's a brand interacting with consumers, a business-to-business organization talking with customers or even a publicly traded company communicating with investors.

All this chatter about a definition change ironically is good publicity for public relations, which has gotten a bad rap now and then.  The word "spin" has a negative connation and often is incorrectly used to help explain PR, which is only a small component of the broader discipline, although there may be no denying some truth to the negative sentiment.

Explaining public relations to those that don't really understand it always has been a challenge, whether educating a family member or even a new business prospect.   It's very complicated to say the least and probably more art than science, not to mention nerve-racking. Coincidentally, public relations continually ranks high in surveys about the most stressful careers.

One crude yet effective way to explain public relations is to compare it to advertising.  Advertising is an organization talking about itself and public relations is someone else talking about that organization.  A client once said that people will remember an article in print or online but very rarely recall the ad next to it.

Selling PR to prospective clients may be a little easier as more people engage in the discussion about a definition change. The reality however is that people are talking about PR and for the public relations industry that's a job well done

 -- George Medici, gmedici@pondel.com

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One option is to conduct a reverse split if a company doesn't receive an extension. Since 2005, 264 NASDAQ companies have completed a reverse split for one reason or another. The results of this action have been mixed. 

Perhaps there may be an alternative sooner than we think.  Next year NASDAQ will launch the NASDAQ BX Venture Market. This new exchange was recently approved by the SEC and will provide companies with a national listing above a standard OTC quotation.

Following are highlights from a recent conversation with NASDAQ's director of listings about the new BX Venture Market:

• Eligibility for the market requires a company to meet a number of quantitative standards including a $0.25 per share requirement for securities that were previously listed on a national exchange;
• $1 per share requirement for companies not previously on a national exchange;
• Companies must know if the move will impact investors ability to continue to own shares;
• Securities will need to meet the initial listing requirement of $4 to relist on the NASDAQ Capital Marke

While the BX Venture Market may be a viable solution, nothing beats operational performance.  However, this new market can be a good platform for companies as they reestablish their footing in today's economy. 

-- Matt Sheldon, msheldon@pondel.com

Anna Gaidenko, a first year graduate student at the University of Southern California's Annenberg School for Communication & Journalism, has been awarded the 2011-2012 annual Wilkinson Scholarship Award.  

Gadeinko is working toward a master's degree in strategic public relations, focusing on the global market.  She intends to bridge her interest and experience in both the international arena and communication field post-graduation.  Born in Kiev, Ukraine, Gaidenko lived in Cleveland before moving to Miami and completing a Bachelor of Arts degree in international studies and criminology at the University of Miami. Prior to applying to USC, she taught English in the Czech Republic, travelling the surrounding regions and doing freelance writing, which led her to discover public relations as a profession. 

The Wilkinson scholarship is awarded annually in memory of Cecilia A. Wilkinson, an active USC alum and a principal of PondelWilkinson, who passed away in 2007.

The video above is Gaidenko's take on how social media can enhance public relations.

Nearly three-quarters of all investor relations officers set specific goals and objectives to measure their IR programs, according to a just released NIRI survey.  I'm actually quite surprised that the number isn't closer to 100%.  In the absence of goal setting, how do you determine priorities and make decisions about what to tackle on a daily/weekly/monthly basis?  How do you adequately assess which activities add value for your company and which don't?  How is your personal effectiveness evaluated? 

Of those who do report formally measuring their programs, 80% use both quantitative and qualitative measures.  The top five measurement criteria noted were 1) relationships with the financial community; 2) feedback from the financial community; 3) individual meetings with top shareholders; 4) qualitative assessment by the C-suite; and 5) composition of the shareholder base.  I might also consider looking at changes in sell-side sponsorship, additions to earnings conference call participation and introductions to new potential shareholders as a tactical method of determining how an IR program is progressing.  Unsurprisingly, and for good reason, most of those surveyed do not believe a change in their company's share price is a valid measurement tool. 

Clearly there are many ways to track and measure IR effectiveness, and much is dependent on company performance, size and maturity.  Although investor relations is a delicate balance between art and science, it seems that not setting goals and objectives for your program is a big disservice to yourself and everyone involved in building sustainable value for shareholders.

-- Laurie Berman, lberman@pondel.com

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The Occupy Wall Street movement is less than two months old, and yet it feels like the story has been around for decades.  I'm not convinced it's a result of the Occupiers' public relations prowess.  It's probably more of a function of the archetypal roots of the story - media have been covering protests ever since the dawn of newsprint.  And think about the ingredients that comprise this protest story.  There's emotion, civil disobedience, and plenty of cause, especially with a staggering unemployment rate and an allegedly clear and present culprit: Wall Street.

But the future of the Occupy movement is unknown, and even though big banks are the targets du jour, who's next in line and what are the Occupiers' long-term goals?  It appears the movement is in the midst of a public relations crisis, and unless the collective consciousness can think of something quickly, the cold snap of winter is going to shut this protest down.

War, civil rights and genocide all present perfectly valid theses for inciting protest.  There is a means to an end, and even if the end is not near, the path to salvation is clear.  But the Occupy movement has no such endpoint.  All of the ingredients are present, with the exception of a well-articulated goal.  Hey, hey, the protesters might say, the movement is evolving organically because that's what the people want.  But when was the last time you tried to accomplish something without knowing what exactly you were trying to accomplish?

So here's some public relations advice to keep the protest alive and media engaged:

• Set some realistic goals that Occupiers and non-Occupiers can understand and rally around to stay motivated;

• Assemble a dream team in Washington, i.e. lobbyists, politicians, union leaders, financial executives, etc ... and create an action plan that everyone running in the 2012 election will have to address and promise to review if elected;

• Keep the messaging consistent across the country.  Yes, there are a lot of things people are angry about, but staying focused on specific topics will ensure a more cohesive and powerful message;

• Know your allies and do whatever is possible and practical to support them;

• Do not generalize or stereotype when attacking a target.  Be specific.  Not everyone on Wall Street or who works for a big bank is an enemy.  The movement has already alienated itself from powerful people who can help accomplish the very change the Occupiers are (perhaps) seeking.

-- Evan Pondel, epondel@pondel.com 

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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

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.

-- Robert Jaffe, rjaffe@pondel.com

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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

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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.   

For more information on Crisis Communications, feel free to contact me at mwilson@pondel.com and I'd be happy to introduce you to our team.