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Edelman: A Knowledge-Driven Business PDF Print E-mail
Written by Meghan Flynn   
Friday, 01 January 2010 00:00
Matt Harrington, president and CEO This fall, Edelman, the largest privately held PR and communications firm in the world, moved nearly 500 staff downtown to its new office in New York City. The move and the office’s design, according to US division president and CEO Matt Harrington, are no small feat for a firm of Edelman’s size.

“We have a completely open floor plan, and everyone is out in the open in cubicles,” he explained. “That was a deliberate design feature to emphasize how at Edelman, everyone’s opinions and ideas can be heard, and although there are plenty of titles and levels, there are no restrictions on how individuals can contribute and our teams can innovate.”

That attitude remains strong at Edelman even 57 years after Daniel Edelman founded the company as a consumer products PR firm in Chicago. Its first clients were corporate giants Gillette, Kraft, and KFC, and that legacy continues today. Edelman has leading relationships with Microsoft, Astra Zeneca, and HP, and does corporate reputation management for Samsung, GE, and other top-tier global brands.

premier Harrington, who leads the US region and is based in New York, described Edelman today as a global communications consultancy firm. The company has 51 offices in every major region of the world and a number of smaller businesses such as Blue, an advertising agency that focuses mostly on issues advocacy work; BioScience Communications, which focuses on medical education and publishing; and its sports and entertainment marketing firm, Matter.

“Typically, we’ve grown with our clients by expanding our global footprint through acquisition of local firms and putting our business philosophy in place,” Harrington said. “When we make an acquisition, we look for companies that share our intellectual curiosity and entrepreneurial spirit. A good cultural fit needs to be there if an acquisition is going to be productive.”

He attributed Edelman’s success in the last year or so to that spirit, as well as the company’s emphasis on intellectual property. Its research division, Strategy One, oversees a number of the firm’s flagship studies, a unique asset for a PR company. And even during this recession, Harrington said Edelman has continued to invest in its IP and business, not slashed budgets like other firms. In fact, Edelman didn’t lose any of its top 40 clients in the last three years, most of which saw a 16% growth in revenue in 2008.

This summer, Harrington went on a listening tour of all the US offices to reinforce the message that, even in these tough times, everyone needs to be focused on serving the client and that innovation is encouraged, if not expected, from every level of the organization.

“Our independence has enabled us to maintain a proactive stance in this recession, and our IP is a crucial value-add for our clients,” he said, citing specifically its Trust Barometer and Goodpurpose study.

Intellectual assets
This year was the third running for Goodpurpose, which measures customers’ expectations of companies and brands to have a social purpose, including philanthropic, community outreach, and CSR programs. In a year when most may have expected consumers to default to price alone, the 2009 release in October reported 57% of the 6,000 surveyed across 10 countries said they chose a brand in part based on its good works.

Harrington said the practical application of this study for Edelman and its clients is that they are able to develop logical and therefore authentic good works programs, which is vital since consumers have more resources than ever to hold companies accountable. This is especially true in light of the upcoming 10th annual release of Edelman’s Trust Barometer study, which measures the trust held by global elites of business, NGOs, government, and media. The 2009 study indicated a dramatic drop in trust of both business and government in the previous year.

“All of this information speaks to the evolution of public relations toward public engagement, the success of which is measured by the degree to which a business or organization is directly engaging its stakeholders in a conversation,” Harrington said. “We’re at the bleeding edge of this evolution because of our independence, not being beholden to Wall Street and therefore free to pursue innovative lines of thought and find practical applications for them.”

Social media is another area where Edelman is ahead of the pack. It was the first agency to have a Web site back in 1995, the first to create a crisis Web site for a client during the Odwalla apple juice recall in 1996, and CEO Richard Edelman was one of the first CEOs in the country to have a blog.

One of Edelman’s newest studies, rolled out in early November, measures the impact of digital media in the US and Europe specifically on policymaking. The study found 96% of Congressional or Parliamentary staffers were using online resources to research policy issues, and more than half indicated the Web was their first source of information. One in five said they had changed policy positions based on information and opinions they found online.

“The industry is changing, and businesses look to communications agencies like us to be the experts in helping them navigate that change. In addition to delivering great service, Edelman looks to serve as a leader for the industry,” Harrington said.

A culture of learning
A key reason for Edelman’s continued success, he said, has been investments in employees over the last decade. In addition to encouraging collaboration and innovation, the company supports its people with ongoing training through Edelman University and its cultural immersion program,
Living in Color.

Edelman University began 10 years ago as a tool for organizing standard practices throughout the company and to create a forum and repository for industry knowledge. It runs on a classic academic calendar with a program director and executive leaders serving as deans for each office around the world who ensure every employee completes at least 24 hours of training each year.

One of the newest programs at the university is its social media training program that uses a colored belt system to signify levels. The first-level white belt, for example, can be achieved after 11 brief online introductory courses to social media. New levels will be continuously rolled out over the next few years, so there is always something for people to learn. Harrington estimated that of the 1,800 employees in the US region, 600 had completed at least the white-belt level, with 5,800 lessons provided since the June 2009 launch. He added that next year, the company is considering plans to roll out a training incentive program.

Edelman’s Living in Color program, launched five years ago, takes a different track to employee education. It’s an incentive program that encourages employees to immerse themselves in the “outside” world of music, art, politics, and charity work. Every year, for example, Edelman provides pro bono PR work for local and national charities.

“Both of these programs are homegrown. We encourage our employees’ creativity not just in serving our clients, but also by contributing to our communities and as a by-product making Edelman a more interesting and productive place to work,” said Harrington. “These are both ways we can continue to foster a culture of learning that will ensure another 50 years of success.”