Jason Calacanis has posted some helpful tips for CEOs of startups about how to maximize PR. Oddly he feels these negate the need for a PR firm. Most of them involve dedicated networking, building personal relationships and, of course, having a newsworthy company to start with.
Many CEOs may struggle to find the time to do this themselves, even if they have the acumen and desire. The CEO-as-brand type of leader is probably in the minority. They make the PR team's job much easier, but most are too humble, team-oriented or focused on building their business to execute this approach themselves, despite the benefits.
If a CEO has an understanding of the media, can describe their company clearly and without hyperbole, and has the time to prioritize this on a consistent basis, then it will certainly be a good asset for any PR program. I wouldn't suggest it be the sole approach, and any effort should be in line with a broader strategy in terms of message, outreach and follow-up. Every team needs to work in concert, even if that team involves the company CEO.
On a related note, I tire a little of the PR (and PR firm) is dead / broken / irrelevant meme. I know it gets a lot of comments (since we read the sites) and wider debate (since PR folk tend to blog), but it's a bit dated. Yes, the low barriers to entry to PR and lack of professional license mean the quality of some practitioners is lacking and they spam reporters and bloggers. But issuing press releases is not the totality of PR. PR does not stand for press release (though i've heard it innumerable times). And not all PR firms are the same.
My recommendation for startups looking to appoint a PR firm is simply to look at the commercial track record of that firm over the last 3-5 years. If they are doing well compared to their peers and growing consistently, then you can deduce they are delivering value. You may feel they are the 'best of a bad bunch', and well, I'm humble enough to admit we've all got room for improvement. But so have the accountancy and law firms I've worked with.
I don't take the criticism personally, and perhaps shouldn't give it airtime, but I'd hate for people to take advice not to appoint professional counsel at face value. If you think PR is bad now handled by firms who do it day in and day out, wait until you see those who go solo. I wouldn't fancy defending myself in the court of the media (see the fates of Arthur Andersen, WMD, Michael Jackson et al), when the firm's reputation is at stake.