Subsidies: PR and perception management

It is not surprising to read reports of government media advisers telling newspaper editors how to report on price hikes, following the move to reduce or eliminate subsidies.

It seems it is okay to say ‘upward price adjustments’ and ‘subsidy rationalisation’ but not ‘price hikes’ or ‘barang naik’. Ridiculous? It’s all part of the info-war.

Increasingly governments are using public relations experts to manage the way the public reacts to controversial new policies and to neutralise dissent. In public relations circles, this is referred to as ‘perception management’.

Perception management essentially means changing the reality as seen by your target audience so that it corresponds with your reality.

I have a feeling this art of managing perceptions has been applied in the approach to scrapping or reducing subsidies. Logically, public perception of the plan to remove subsidies would be largely negative. The task of the public relations folks would be to try and alter the way the public views reality so that it corresponds with the government’s perception of reality. In other words, the government’s public relations people probably aim to try and narrow the ‘perception gap’.

Thus an elaborate plan seems to have been put in place involving “subsidy rationalisation labs”, displays of superficial but much publicised efforts at ‘consultation’ with the public, and dubious opinion polls apparently showing the public as open or receptive to the idea of removing subsidies. Look at this online poll on the Government Transformation Programme website, for instance: if you vote “No” to the subsidies, you must still vote for a time-frame (1 year, 3 years or 5 years) for the government to reduce subsidies; otherwise you cannot submit your vote!

There was even an attempt to create a sense of impending crisis by highlighting the possibility that Malaysia could face bankruptcy by 2019, if subsidies were not slashed. Why, the slashing of subsidies was touted as one of the key ways of averting possible bankruptcy. (No mention of cuts in other areas of government spending such as defence.)

What is perception management? It has been described as follows:

Perception is a way of seeing, understanding or interpreting. In business, perceptions describe the way stakeholders perceive an enterprise or a brand, based on its actions and the behaviour of its people. To stakeholders, perception is their reality. Perceptions may be good or bad, depending on the experiences that stakeholder groups might have had when engaging with the organisation. We suggest that companies become more sensitive to these perceptions and work to address the perception gap – i.e. the gap that exists between stakeholder perceptions and the company’s ideal perceptions of itself. Hence, perceptions have to be managed to ensure that a sound reputation of the organisation is nurtured. Perceptual assets are intangible but nevertheless valuable. By managing perceptions, an enterprise builds reputational value.

How do you manage perceptions? Can perceptions be managed?

The answer is yes! Typically, the process would begin with a Stakeholder Perception Audit to gauge perceptions held by key stakeholder groups towards the organisation. Following from that, the organisation would commit to addressing each key issue of perception, identifying perception gaps where they exist and implementing appropriate change programmes. Meanwhile, the task of communicating messages begins, messages founded on truth and fact. Over time, the leadership succeeds in growing the enterprise into an organisation whose values represent those sought by its key stakeholder groups. Essentially, there must be interest in feedback and a commitment to addressing the issues raised in the interest of changing negative perceptions to positive ones.

Is Perception Management similar to public relations?

Yes and no. It is similar to PR in that we are all concerned with reputation. In traditional PR practice, however, insufficient attention is given to the view from the outside. Oftentimes, PR and communication campaigns address the needs of the enterprise with the result that messages are one-way and directed from the inside-out. To be truly effective, messages must consider the needs of the stakeholders and be strategic. They have to be focused on their value in changing perceptions. Managing perceptions means communicating with an outside-in perspective.

Do you know, the art of perception management was used to sell the Iraq War to a US public that had been wary of major foreign military adventures ever since the debacle in Vietnam.

The government probably feels the media have a crucial role to play in shaping public perceptions. Thus the mainstream media are advised against using the terms ‘price hikes’ and government savings and instead play up the benefits of reducing subsidies to get the public to buy into the idea. Why, the removal of subsidies for sugar is touted as a health benefit.

The spin continues. Coffee shops land up shouldering the blame when they raise the price of teh tarik by a few sen following the government’s price hikes. (On the other hand, you hear little criticism of Pos Malaysia when it implements hefty hikes in postal rates despite making substantial profits.)

The problem for the Malaysian government is the mainstream media have low credibility and thus the proposal to scrap or reduce subsidies is that much harder to sell to a more critical and discerning public, post 8 March 2008.