Three numbers: Stephen Waddington on making the case for comms in 2027

Stephen Waddington helps communicators achieve high performance and contribute effectively to management. He is a professional adviser at Wadds Inc., a former President of the CIPR and, with Ben Verinder, co-editor of this year’s must-read book, AI for Public Relations. In September he submitted his PhD at Leeds Business School, on the conditions under which public relations is recognised as a management function. We spoke on Friday 9 October, with 2027 budgets being set.

The Brief

• The savings question has arrived: Several of Stephen’s clients have been told, as part of 2027 planning, to turn their use of AI into headcount and agency budget savings.
• Value pricing depends on measurement. AI is making the billable hour hard to defend, but pricing on value only works if the organisation can see what comms contributes, and measurement has “always been our Achilles heel”.
• The takeaway: Before your 2027 plan goes in, put what AI has saved, and where the time went, into the three numbers management cares about: top line, operational savings and intangibles. Then the savings conversation starts from your evidence.

This was a Comms With AI Leader Interview, our live webinar series with leaders in communications and AI, recorded on Friday 9 October. The full conversation is below, and if you’d like to join the next one live, upcoming sessions are on the Comms With AI events page. (One declaration first, since Stephen opened with one: he was a judge for the AI Comms Awards category I won in June.)

The Story

At a public sector meeting Stephen attended this summer, a non-executive director stood up and challenged the comms director on why they weren’t using Copilot to save costs and reduce headcount. 10:58

Stephen calls it “the sharp end” of a pressure that has since reached the planning round. “Planning instructions are out for 2027,” he said, and he has had it from several clients that management wants AI use converted into headcount and agency budget savings: a “very clear instruction, strategic instruction from management as part of this cycle”. 16:44

Though the conditions are novel, the argument underneath is an old one. “It’s a variation of everyone can communicate. Everyone can write, everyone can make pictures. Why do we need professional communicators?” 11:50 AI sharpens it, he said, because everyone has access to it and it “seemingly can do the output job of what we can do”. Sound familiar?

The value already given away

Agencies that moved early, Stephen said, got lift from AI and turned it into margin, or used it to move faster and do more for clients. “The challenge is if they did not capture that value and present that value to their client, that’s now baked in.” 12:38

His way out is to stop selling time. “If the cost of production is now close to zero, then you need to rebuild how you create value.” That runs straight into the profession’s oldest weakness, because value pricing “is dependent on the client or the organisation being able to recognise the contribution of the function. If you can’t measure that well… the whole thing collapses.” 14:11

Three numbers

So start with what management counts. “Fundamentally, there are only three numbers,” he said, that a management team cares about: what comms contributes to the top line, to operational savings, and to intangibles on the balance sheet. 19:19

“How do we contribute to… the crisis that’s averted?” he asked. “We’ve never, as an industry, been able to capture that value.” 21:21

His advice is to price, and defend, the judgement work clients and management look to comms for: strategy, counsel, crisis and issues management, and “bringing the outside perspective in” through listening. “Think about what you’re going to deliver before you even go near talking about fees.” Agencies can move faster on this, he said, “but the same thing needs to apply within the comms function”, starting with “figuring out some value to what you’re doing”. His steps for agencies moving to value pricing are worth reading in full. If you have never mapped where your team’s hours go, the Comms Workflow Audit in the Comms With AI library is a reasonable place to begin.

Where the time goes

Stephen wrote last month that AI has made us all editors, and this is the part I recognise most. I trained in video production at the BBC, and I’ve spent many (many, many) hours of my working life on things like captions, which now take pretty much a click of a button. I’m using Claude to make infographic videos for Applied that would once have taken me hours to get to nearly the same standard.

However, every one of those still needs an editor’s eye. I dictate with Wispr Flow, which still regularly spells my consultancy Faur wrong unless I say the letters out loud. The Scottish accent may not help, which does remind me of the classic Burnistoun ‘Scottish Elevator - Voice Recognition’ sketch…

It can feel like the more things change, the more they’ve stayed the same: the models are vastly stronger than a year or two ago, and I still comb through the finer details.

That checking falls to whoever has the experience to do it, which is Stephen’s point: AI is “pushing work to more expensive, senior practitioners”. As he put it in the same newsletter, “If a document that took three hours’ work now takes 30 minutes of prompting and an hour of review, the time taken has fallen but the cost per hour has risen.” It lands on the way into the profession too. Captions and media monitoring reports were the kind of work people learned on, and AI now does it. “The routes that you and I had into the industry are now disappearing,” 25:51 Stephen said, and the thinking on how to rebuild them “is only just starting”.

Ask for the budget

New work needs new money, and Stephen’s clearest case is AI visibility. AI models build their answers from earned and owned content, and some social, which makes this, in his words, “an assertive opportunity for public relations”. 37:26 It also cuts across social, web and, for a retailer, review sites such as Trustpilot, so the comms job is “to convene those functions and ask for the budget to do the work to protect reputation within an AI model”. It starts with a visibility audit, which you can run yourself for nothing.

Then the uncomfortable part. “We add channels to what we do all the time… without asking for additional budget, and we never switch stuff off, or we very rarely switch stuff off.” The one recent exception he could name was X, switched off “because of Musk, not because of fatigue in the channel”. 39:32

Who gets into the room

Even a strong case needs someone to hear it. Only exceptional practitioners, Stephen said, have been “let into the room” where organisations decide how they govern themselves. 23:01

I asked what, from his PhD research, had most changed how he advises clients.

Stephen: “Competence isn’t the beginning or end of how a function is recognised. It’s hugely contextual, and it depends on the perspective of the management team, notably the CEO… That relationship between… the comms leader and the management is so critical to recognition of the role and recognition of the value of the function… It’s as important as competency and skills and how we show up. I think that’s my PhD in two sentences.” 40:33

His viva is still to come, and he will share the findings once he has defended the thesis – I was (and still am!) grateful for his time at this stage of his studies, and know that not just myself but all the event attendees are wishing him all the best with this. At this juncture, his considered and heavily researched perspective on the industry landscape couldn’t be more essential.

The Practice: what to borrow from Stephen

1. Start his log this week. Every task AI helped with, the hours it released, where those hours went and what they produced, plus the new work AI has created. A shared spreadsheet is enough to begin.
2. Build your 2027 case around his three numbers. Top line, operational savings, intangibles. Name the judgement work you will defend (strategy, counsel, crisis and issues, listening), and if you’re agency-side, agree outcomes with the client before you agree fees.
3. Cost one piece of new work as new budget. AI visibility is the obvious candidate: run the audit, take the result to whoever owns social, web and reviews, and ask for the money together. Then name one thing you will switch off to make room.

If your finance director asked tomorrow what AI has saved your team, what would you show them?

Every Applied piece follows the same shape (The Brief, The Story, The Practice). This one was drafted with Claude from the recording of our conversation, with every quote and claim checked against its source, a second/third/fourth review from ChatGPT run in parallel with final edits by me. Stephen saw and approved his quotes before publication.

Coming up: the next Comms With AI Leader Interview is Advocate and Sceptic: Billy Partridge on AI and Human Judgement, online on Wednesday 28 October, 12:15 to 13:00 GMT. Billy is Chief AI Officer, UK, at Grayling, where I work as a freelance digital and social director.

Stephen’s newsletter is read by almost 6,000 practitioners, and he runs a one-day AI for public relations course with Ben Verinder. The next date is 24 November.