Monday, May 14, 2012

The Corporatization Of The Lobby Industry

This is a fascinating description of how the lobby industry has evolved.  Most of the independent lobbying firms have been bought out by corporate conglomerates.  One conglomerate, WPP, has become the leader of the pack. It has specializations in advertising, public relations, consulting etc., and it operates in over 100 countries.

The implications of these changes in the lobby industry are not totally clear to me. Some say that it makes firms like WPP more effective than the boutique firms that it acquired.  Others claim that it has depersonalized the lobby industry. There is less real involvement in the function of government. The attainment of corporate financial goals becomes the primary objective.  It may even be the case that government dysfunction creates more demand for billable hours.  WPP will lobby on both sides of any issue by using a variety of the shops that they have acquired.

The article also makes a statement about the difference between corporate cultures and smaller businesses operated by entrepreneurs.  The result is bureaucratization and mediocre performance over time.  The process of growth through acquisition is also unstoppable.  It is hard for the owners of the boutique shops to turn down the payouts that are offered.  The entrepreneurs leave soon after they satisfy their earn out agreements.


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