Oral Histories

James Arnold

Interview Segments on Topic: Arthur Page/Principles/Society/Center

James Arnold Biography

James Arnold is a management consultant who specializes in reputation management. He has served more than 200 companies of the Fortune 500, as well as large government agencies and major nonprofits. Arnold also has experience in public affairs at local and national levels. Mr. Arnold served for 18 years as a trustee of the Page Society and is accredited by PRSA.

Transcript

INTERVIEWER: Wonderful stories.

ARNOLD: Well, we haven’t talked much about Page if you want me to say…

INTERVIEWER: Yes, if you could talk a little bit about…

ARNOLD: Well, Chet was one of the original trustees of Page, because of his AT&T relationship and when Page first started it was essentially an inside AT&T thing, which was very big. During those days, the AT&T Corporate public relations staff was over 1,700 people, just at that time. Arthur Page was largely at that time, an internal figure to people in AT&T. He wasn’t that well known, and in fact, in 1970 when they—it was a forced ranking by PRSA of 119 so-called famous people in public relations, and at that time Page had barely been dead for 8 or 9 years, and he finished #9 on the list. Everybody ahead of him though was the head of an agency. He was the first corporate person but, just wasn’t known in the field particularly at all, so AT&T started off thinking this will just be kind of like retirees and current AT&T employees, and it’ll just be to kind of keep his legacy alive. Chet was one of the people I think who helped turn their thinking away from this direction. He was at that time the only non-AT&T employee who was a trustee, although as he points out, he was one of two people never to have worked for AT&T, who was in the telephone pioneers which was the AT&T Retirees Association. He was elected as an honorary pioneer. And he argued that if you really want to make this something, that you’ve got to broaden it out eventually, but Chet was a trustee for only two years, and then he very generously said to me, “I think I’m going to be wrapping up my affairs and I think this is a great opportunity for you, and I think at this point they will accept you onto the board,” even though—I think there was one other person at that time who was not in AT&T, but they were heading in that direction. It was a very different organization. It was really sort of making it up as it went. A lot of what it did, was almost of the luncheon club variety of people get together, have a good time, share war stories and encourage one another and catch up on grandchildren and things of that sort. It was not very mission-driven at the time, but over the next 4-5 years that I was involved, I came on the board in 1986, it really began to develop a mission. I guess the easiest way to say it was that if you’re thinking about dogs and you like dogs, the mission came to be—how do you improve the ‘breed’ of person who is working in corporate communications. And mentoring became a large part of that, but there was also a sense of, we need to get as big a tent as we can get here, so we need people from different industries so that we can begin to pool our knowledge and our intelligence and our connections. Find ways to set standards and enforce the standards. There was a period of time in which there was some concern about kind of a deification of Page business like, why are we making Arthur Page out to be almost a God-like figure in doing this organization? And in fact, there was a contemporary of Page—his name was Paul Garrett, who was at General Motors and was also extremely influential. He actually had a more high profile boss in Alfred P. Sloan—to make him have a lot of impact. And both Page and Garrett were very active. They both were on the board at the Metropolitan and they took turns chairing the publicity committee and on most of the other social service things in town. So they were friends, and they had a lot of influence on each other. I think the big difference ultimately was that Page more than anybody else had—let me just say clearly, the two of them were responsible for beginning to institutionalize public relations inside a corporation as opposed to what say, Ivy Lee or Eddie Bernays or Earl Newsome or Carl Byoir would do, which was to keep public relations a separate business using clients from the inside. So creating a role for public relations, and then trying to integrate it into the organization was terrifically important. The thing about Page, and the way he did it that I think distinguished him more than the others; he was much pithier at describing why he would do things and the way that he would do it. He also had a really good focus I think; on what’s important and a lot of people attribute this to the fact that AT&T was a monopoly. It helped to set the principle and that was that the public interest had to be uppermost in what you did in business, and thus his often quoted phrase about public permission and public approval is significant, but, he believed that, and he used the word character—Page did—long before anyone else did. It’s now a buzz word. I saw in yesterday’s Times, that the current CEO of Coca-Cola, Muhtar Kent, says that he believes now that customers are as interested in the content of our character as a company as they are in the content of the product that we make. I think that’s true. I think the word character—maybe it combines reputation and brand and a whole other assemblation of attributes or qualities, but to me the world character, which Page liked and used—and he used to say over and over again, we have to keep the character of AT&T open and available and transparent so that it shines through in everything we do. Whether it’s a switchboard operator or the lineman or anybody else, they all have to participate in doing this. He’s often attributed as having said it’s 10% saying and 90% doing. I think his idea of institutionalized public relations evolved beyond that because he said that fairly early in his career. You can see, in reading through the speeches, how his thinking evolved and became more sophisticated, but it was always anchored in this one thing which was, Page in his life—you will see his involvement with the government was always sincere and genuine. He always believed that ultimately the people’s will would be done by any company, whether it was in the private sector or not. That if you lost the support of the public, then you ultimately would fail and your enterprise would fail, that it had to be there. Well, he’s the first I think of the American business leaders who really understood that public opinion had been mobilized and organized with the emergence particularly of the giant publishing companies, newspaper companies and the radio companies and he could anticipate what was going to happen with television, which happened really in his own lifetime. But he understood how public opinion had become a significant force, and he also understood that it was the ultimate arbiter. It was the decider because if a business got too far out of alignment with what people thought and valued, they have a way of reining you in. But he wanted AT&T, in a way, to keep itself open all the time, so that people could see it because he said, “As the secret of being a monopoly is, you can’t have secrets. People have to see what you’re doing because they had to always be reassured, a) that you’re not using your monopoly just to enrich yourself or that you’re not being slothful just because you have a monopoly or you’re not being inefficient because you have a monopoly.” Because as he said over and over again, the one thing we manage to do is to get people to accept the fact that AT&T could be called a natural monopoly. We haven’t overcome their suspicions of a monopoly though, because that’s still inherent. The American state of mind is to be suspicious of anybody who doesn’t have competition. Well, all of those things, fermented in a very yeasty-like way in the early days of the Page Society, because people could connect with—those are very contemporary ways of thinking about a company and its use of public relations.
Page was also very, very insistent that the purpose of public relations—or as it was called, information, in those days—was not only to make sure that the management’s point of view was known to the public but that the public’s point of view was known to the management. That’s very vital because I think, particularly in the last 20 years or so, that more and more the management of organizations—all organizations—regard public relations as being a microphone to broadcast what they think. What they want to say. Their story. Their point of view. And less and less as a source of intelligence about what the public thinks and the outside environment. And I see this as being very critical for the success of any good public relations operation and its critical to the success of a public relations leader, who wants to be a counselor, because somebody has to be the one, when you’re getting it wrong, somebody has to be the one to go to the management and say, “But the public isn’t seeing this you know, that’s not what they think, we’re not getting across to them.” And that may mean then that we have to change a policy, we have to change a procedure, we have to change a product, we have to change a service. We have to do something here because ultimately in the collision between what the public expects of us and their lack of satisfaction with what we’re doing now, they’re going to win ultimately. And so it’s up to us that as good stewards—managers of the company—to try to anticipate where this is going, I think some of Page’s most interesting pieces had to do with anticipating where public opinion was heading, and the changes that were coming. You just don’t hear many people think about that very much today. One person did and I think the person who’s most informed by Arthur Page was Peter Drucker. Almost everything Drucker writes, first of all in the concept of the corporation, which he did, based on his work at General Motors actually. And then secondly, in the practice of management, his 1954 book just highlights over and over again the views that Page had, as well as the views that Garrett had about what public relations should do. Over and over again, Drucker emphasized this. I had the rare privilege of getting to know Peter Drucker, and having visited him on more than one occasion. Having lunch with Drucker, I said to him, “Why do you think it is that public relations today doesn’t have the same sort of automatic credibility or acceptance with the senior management team that say, it would in the time of a Paul Garrett?” And Paul Garrett actually had Drucker make the first study of General Motors, which became the concept of the corporation. Say of a Paul Garrett at General Motors or an Arthur Page at AT&T and he said—he got a little impish and he said, “Well, because of my fellow countryman Eddie Bernays. He said you know, Eddie Bernays taught everyone that public relations was about gimmicks, and about coming up with some kind of a big idea, like a celebration or a promotion or an anniversary, that would attract the attention of the media. And he said, the problem with that is, if you’re running a public relations firm, that’s the way you can make a living but if you’re running a company, that’s not what public relations has to be to the company. It can’t be that. And he went on to say, which I thought was just remarkable he said, “What’s happened here is because of Bernays. Everybody thinks public relations is getting the word out and getting their story out. Telling your story, pushing stuff out, pushing messages out, broadcasting messages.” And he said, “Back in the original concept of public relations inside a company”—almost quoting Page verbatim, without attribution I might add—he said, “Public relations credibility comes from being able to advise management directly of what things will work and what things won’t work, based on the public’s opinions and attitudes.” And he said, “You don’t hear much of that anymore.” He said, “So I’m going to take it then that the caliber of people doing public relations inside of corporations today is much less than it used to be, at a time when there was an Arthur Page or a Paul Garrett. And I’m going to assume that they don’t personally have the credibility or the stature with the management of their companies to be able to make this a part of their portfolio, such that they’re going to be sitting there when people are saying, ‘What should we do or what should we not do?’ They’re going to be involved…it’s the ‘how do we say this’ or ‘how do we explain this’ stage. Not in the ‘what should we do’ stage.” I was struck by that, by his willingness to say that. But Page’s business about the public interest was very critical to Drucker. If you look at the end of his book, Practice of Management, on the last page of the book, he wraps it all up and he quotes an English pamphleteer, a mandible from the 19th century—who was a political economist. And that’s different from an economist economist. But he wrote a satire called The Parable of the Bees and in The Parable of the Bees he had a philosophy which he expressed, which was the philosophy of a lot of political economists at the time, which was that private vices yield public virtues. So, it’s okay for people to do bad things because in the long run they cancel each other out and the public benefits from that. Drucker ends his book by saying, in the democratic form of capitalism that we know today and is practiced in the United States of America; nothing could be further from the truth. Because people have learned now that you have to conduct private business in the public interest. It’s almost a Page statement. He was very influenced by Page and by what Page wrote and by what Page said, and I think in that sense it’s been remarkable to look both at what Mr. Garrett did and what Mr. Page did and how ultimately, they influenced Peter Drucker so heavily in his concepts and his writings. And he’s intimately familiar with both of them. In fact after Alfred Sloan left General Motors, and Garrett was no longer working there, Drucker would have lunch at The University Club once a week, and sort of commiserate about what was going on in the world of high finance in New York City. Absolutely fascinating stuff, and I think that the Page Society has continued to expand and to grow to accomplish this mission. I think it’s gone beyond just thinking of how to improve the breed; it’s not trying to run real programs that will make consciously the effort to do that. I can’t tell you how successful that’s going to be as a strategy because when I look back over the history of corporate public relations in particular, where I find that there have been real flowerings around—it was grown and there were highly visible people—they were really a people of top-notch quality. And the question gets to be, can you mass produce people like that? It’s like the age old argument about leaders you know, can you really make leaders? You can expose people to leadership skills and leadership strategies, but does that transform them into leaders? That’s a real question, and just to go back to Chet just for a moment, Chet confessed to me one time late at night on a plane that—I ask him, what’s the most frequently asked question that you get from people, not necessarily clients but people you know, for advice and stuff and he said, “Oh without question, it’s from people who are in positions in their organization, and they want to be taken more seriously.” And he said, “I guess the easy way to say it is, ‘How do I get more clout with the management?’” And he said, “The disappointing thing is that I can explain to them how I think they should do that, and they will nod and sometimes they’ll take notes and he said, ‘But deep in my heart I know that most of them are never going to have the kind of clout that they think they should have or that they want to have because they simply don’t have the aptitude, the personal skills to seek up and to get into their business.” His favorite line about public relations people in management roles—Chet’s—was that most of them think of themselves as public relations professionals’ first, and not as business people. Whereas corporate management, and he really didn’t like the yuppie idea that you would hear people say, I’m just a portable skills package, I can take myself and go anywhere and do public relations, which would bother Chet immensely because he would say, that’s what’s wrong. You see they don’t really get themselves rooted. A man like Arthur Page, he became central to the business of AT&T. He became central to their rationale for being a monopoly. He became central to the strategy of universal service throughout the Bell System. To the cross subsidy between the long distance lines and the local business—all of these things were Page’s way of trying to show over and over and over again how AT&T had to put the public interest first, ahead of anything else. And Chet would say to many of the people doing public relations, they think exactly that. They’re thinking about, what’s the next job I can get now where I can do public relations? They’re not thinking about, how do I really integrate what I do into the fabric of this business? Make it vital, make it vitiating to the business itself? And that used to be very frustrating to him, because he felt like in a way it was kind of insulting that somebody would come to him and say as if there’s some bag of tricks that you’ve learned that you could just go plant these seeds to go grow into a beanstalk and it’ll take you straight up to the top to be successful. That stuck with me, and I think that’s still a big challenge for Page, trying to define, what’s the outcome? What’s the end result of being involved in Page programs in terms of the impact on corporate management, because from the very beginning—from day one, when I sat in a board meeting, there was no question—whether it was Ed Block or Jack Koten or Larry Foster or Marilyn Laurie who was talking—over and over again, the line, the mantra was “Public relations is integrated into the senior management discipline of the organization.” That’s the goal and that’s what Page had done at AT&T. That’s why they chose the Page name and that’s why it was terrifically important, and I do know because I know many people who are in Page and many of them are not in that senior level. And whether or not Page ultimately can do much about that or not, I don’t know, I guess that’s the age-old question. But it’s worth a try. I’m not trying to make it sound like I’m dismissing them. Sure it’s worth the effort. But whether or not it will succeed in a high percentage of cases I don’t know. And thank you very much for asking.

 

INTERVIEWER: Mr. Arnold—James Arnold. Thank you very much for spending time with us today. You’ve shared some delightful stories. Very interesting stories and we very much appreciate it.

 

ARNOLD: Well thank you.