Public relations firms in the Philippines and their life cycle

• Main Author: Santiago, Lucas E.
• Format: text
• Language: English
• Published: Animo Repository 2004
• Subjects: Public relations firms—Philippines; Life cycle costing—Philippines; Public Relations and Advertising
• Online Access: https://animorepository.dlsu.edu.ph/etd_doctoral/1232; https://animorepository.dlsu.edu.ph/cgi/viewcontent.cgi?article=2233&context=etd_doctoral
• Institution: De La Salle University

This research study, entitled "Public Relations Firms in the Philippines and Their Life Cycle" seeks to document in the process of research the history of public relations and its development as an industry, identify and categorize the real players, primarily as they man and operate their public relations firms and offer services within the sphere of their profession's field of specialization and ascertain the effects of strategy and mechanism used by public relations counsellors as owners and operating officers of public relations firms to their life cycle. This study is an exposition of the antecedents or causes and their effects on why public relations firms fail to extend themselves beyond the life of their founding generation. It seeks to define failed public relations firms and compare them with the surviving ones. Their life cycle, superimposed against the popularized life cycle diagram and latest study on organizational life cycle (Lester et al., 2003) is a veritable indicator and gauge for existence. This study also intends to find answers to the organization of public relations firms their antecedents or causes, strategies, the very firms themselves and their environment. Public relations firms, whether operated as sole proprietorship or corporation, bear distinguishing marks in their life as "failures" or "survivors." The survivors have maintained a proactive stance and remained vigilant over trends and developments in the marketplace, which can seriously affect their entrepreneurial orientation or leadership profile, vision, client management, financial management, preferences for innovation, and risk-taking propensity. They equally keep apace with the dynamic market and other forces to recognize the stage of decline which can trigger their demise, as in the case of defunct firms, and steer well through the known external environment. The operating public relations firms are the survivors. They keep apace with the dynamic market and other forces in the in the known external environment. They keep abreast of their organizational life cycle by means of organizational blueprints for updates, interest in cultural orientation and judicious application of technological changes. Adaptation through selection is resorted to by the firms, so that alignment with very satisfactory if not excellent business performance can be attained, to assure themselves of longer life cycle. It is in this regard that the applicability of the “Stewardship Theory” in management could be tested. The firms survive on the strength of their organization, systems and structures and competencies alone, which can directly prolong their life cycle. But even the masterful application of innovative management orientation and well-plotted strategy, which combines entrepreneurial orientation and stewardship, the resultant business performance still serve as a significant determinant of their life cycle. The “failed” firms are those whose management took for granted or ignored the essential requirements for a healthy and robust business concern. Deviations from the factors of entrepreneurial orientation and stewardship, and control of elements in the internal and external environments, generally lead to failures. The Researcher used the Descriptive Research Method in this historical descriptive and case study to ascertain the status of public relations firms operated and managed by public relations professionals, practitioners or counsellors in at least four (04) stratified classes of firms. The units of analysis are the owners or proprietors of the firms. The study focused on the utilization of management concepts of entrepreneurship and stewardship and the applicability of the process of adaptation and alignment in strategic management of public relations companies. The Researcher used a 50-item Survey Questionnaire handed out to target respondents through Simple Random Sampling. Interviews of a select number of public relations firms management, their executives and administrators (decision and policymaking bodies), were expedited. This thrust was centered on wellchosen firms to trace patterns of their rise or decline in business operations. This specifically included official biodata and biographies of target public relations professionals, practitioners or counsellors; the corporate records of their firms. Books, periodicals and journal articles were used to provide more information about the topic. The Research Study utilized primary and secondary materials, informal interviews were conducted on active public relations counsellors and practitioners. Archival sources covered documents from select public relations firms (past and present). Secondary materials were annual reports, local and foreign books, periodicals, and other media. The Researcher tapped public relations counsellors and practitioners who have managed or are still operating their legitimate public relations firms. In the interpretation of the findings of the Study, a qualitative approach was made. Focus in the case study however, was on not less than six (06) public relations firms, past and present. Their operations serve as fitting examples of how public relations firms succeed or fail in their quest for productivity and profitability within a given period. The theoretical framework followed the Soriano & Nehrt concept. It simply presented the interrelation of the firm, strategy and environment. Identified and described were antecedents or causes which affected a firm to either succeed or fail. These factors were especially cited in the firm which in turn, shaped the strategy adapted, as the external environment poses threats on and challenges to it. Statistical methods were employed in the research: frequency distribution, percentage distribution, mean, and chi-square analysis (X2). Public relations firms that are operating here and now and those that are already defunct may be compared on the following basis: Life Cycle. The average life of the operating public relations firms is 12.22 years, while those of the defunct public relations firms is 11.43 years. On the decade by decade basis, based on this study, the average life of Philippines public relations firms founded in the decade of the 70’s is 24.00 years in the 80’s, 15.25 years and in the 90’s, 5.00 years. Organization. Most existing public relations firms are now organized as corporations, although a few of them had started as single proprietorship or partnership. One possible cause of the demise of certain public relations firms was that they did not decide soon enough to incorporate themselves. Education. While most executives of public relations firms now are professionals, they, like the owners or managers of the defunct firms were not formally educated in business management. The financial aspect of the management of the public relations firms, both living and defunct, is a reflection of this fact. Vision. Operating public relations firms have been more open in the articulation of their mission for the management of their firms. On the other hand, vision was less expressed and less stressed by those respondents representing the defunct firms. The matter of stating a vision-mission was relatively not yet ‘fashionable’ or ‘trendy’ at the time of their founding. Succession. While existing public relations firms’ respondents did not so indicate in their responses to the survey the matter of their management succession plan, it is safe to assume that this is covered by their corporate set-up. However, in contrast, the responses of the defunct public relations firms owners/managers/respondents openly admitted that their firms did not consider succession as a reality to be faced by them at any time in the future. This omission on the part of their management inevitably contributed to the dissolution of the public relations firms. Risk-Taking. Both the operating and the defunct public relations firms accepted the reality that assuming risks of various kinds was a natural part of their business operations. Innovation. While the operating public relations firms openly admit that certain innovations in management are necessary to keep themselves up- to-date, the defunct public relations firms show that they were less conscious of the need for them. That being their attitude toward innovation, it would seem that in the time of their operation, the defunct public relations firms were not ready or prepared for innovations. The management of public relations companies or firms stopped business operations and closed shops due to their inability to muster market and other forces and use effective management orientation and strategy. These factors contributed much to shorten their business life and eventually led to their dissolution. This study revealed the causes and effects on why public relations firms in the Philippines fail to live beyond the life of their founding generation. Public relations firms have generally shorter life. They fail to extend themselves beyond the life of their founding generations. This was proven by the impressive numbers of their kind which rose, survived and failed during the 1950s up to the year 2000. About less than fifty (50) of these firms ended up as business failures. Many of them left no traces at all of their existence. However, a good number emerged as new players, but they are generally new ones and not those which persisted to operate since the 1950s which still failed in the process. To ensure longer life of public relations firms, this Researcher recommends a paradigm shift in the strategic management process of adaptation, that is, management of public relations firms should align management forces, so that the framework of antecedents or causes, strategy, environment and the public relations firm itself will be in tangent with each other. More than just realignment and or adapting to change, public relations firms must take all necessary precautions or actions to prevent their premature demise. The life cycle of public relations firms is directly depended on the acknowledged management orientation of their owners or heads (presidents, chief executive officers or chief operating officers). These firms are associated with their founders. These top company men, who are generally non-businessmen or those not cut out for business, should fully study and reorient themselves, with the intricacies of business management, and the dynamism which characterize their preoccupation.