Managing a full blown corporate crisis is one of the hardest things a communicator will ever have to do. Of course, it’s always been vitally important to protect the profitability and reputation of your organization, but as scrutiny of corporate practice rises, so too does the importance attached to effective crisis management.

Failure to prevent or manage an incident can lead to a loss of your organization’s ‘license to operate’. Interestingly, your own personal brand can also be impacted by your response to a crisis – for instance, we’ve heard from several members that successfully managing a crisis instantly makes a communicator more employable, having navigated a course through heavy fire.

So, both for your organization and for you personally, a crisis raises the stakes like nothing else. With this in mind, CEC spent the last few months learning how the best organizations prevent, prepare for, and respond to major crises. CEC members can check out our new topic center for more detailed guidance, or call our advisory team to discuss your crisis planning.

1. Build a Preventative Culture

Most companies have a contingency plan of some description should something go wrong. But actually using that crisis response plan is a bit like shutting the stable door after the horse has bolted – by then, the damage is already done, and you’re playing a game of damage limitation instead of damage prevention.

What the best do: Employees often have the most practical understanding of the risks that the company faces by virtue of their day-to-day business activities.  Instead of simply telling them how to behave and what to do, try to tap into their knowledge to identify and mitigate risks. Read More »

“Hope for the best – plan for the worst.”  I’ve heard this saying many times in my life, used in a wide range of contexts.  Most recently, it came up in a conversation with a CEC member in the Financial Services industry who was referring to his company’s approach to crisis communications.  He emphasized how little room for error there seemed to be these days, mentioning that, despite prudent business practices over the past few years, the public still considered his company “guilty by association,” simply due to a general loss of confidence in the industry.  Trust had eroded and scrutiny was on the rise.

Data from CEC’s sister program, the Corporate Ethics & Leadership Council (CELC), confirms that this is not an isolated perspective.  A recent study of corporate leaders reveals that 77% believe media scrutiny has increased, while 82% report a proliferation of new risk types.  These developments combined with the continued rise in citizen journalism and fluid information flow are making communicators feel more vulnerable to crises.

Faced with such a risky environment, it might seem difficult to truly “plan for the worst.” After all, this assumes that your company can create a comprehensive list of potential crises as respective plans.  And while I won’t recommend that you don’t plan for individual scenarios or try to prevent crises from happening (check out our latest resources on avoiding crisis), I do think there are some things that companies should do to ensure that they are prepared to respond effectively when a crisis hits. Read More »

Every year, corporate crises hit the news, and remind us of their potentially devastating impact on the reputations of those organizations involved. The UBS tax scandal of 2008, Toyota’s three product recalls from 2009-2010, and BP’s oil spill in the Gulf of Mexico in April 2010 all had two things in common:

• They could all have been prevented
• They did significant damage each company’s reputation, and to their financial performance

With the stakes higher than ever before, CEC is updating its existing work on crisis management. And, with the above in mind, we’re looking at two different angles.

1. Building a Preventative Culture

In spite of the best efforts of companies to apply processes, rules, and expectations, this isn’t always enough to drive behavior change – we’ve all seen rules bent or broken to “get the job done”. And yet, we are reliant upon employees maintaining standards to maintain product quality, information security, legal and ethical compliance, and personal or public safety – if they fail to do so, the consequences for the organization can be disastrous.

Communications Challenges

CEC is looking at some of the reasons that employees don’t always act in accordance with the standards required by their organization, its regulators, and other crucial stakeholder groups. Our conversations indicate that many communicators spend a disproportionate amount of time building employee awareness without addressing the personal and systemic barriers to desired behavior. Indeed, research shows that only 6% of employee-observed misconduct is escalated to business leadership, preventing the business from responding to rectify the problem. We’ve thought about what prevents employees from acting in a way that prevents crises. Here’s our first shot, below: Read More »

Another month another massive reputation disaster by a major corporation.  Most of the UK and increasingly the US and Europe have been closely following the ongoing drama of the phone hacking scandal that has blighted News Corp over the past month (although it’s been simmering for a lot longer). It’s the stuff of Communicators nightmares and is only spreading as investigations and revelations continue.

So where did News Corp go wrong in their handling of the crisis?

1. The belief they could contain the crisis: Many analysts, and indeed Rupert Murdoch himself, believed that shutting down the News of the World (NoTW) would  limit the damage. As it only represented 1% of News Corp it seemed a worthy sacrifice.  They were wrong. Circulation of News International’s other titles (The Times and The Sun) have been at an all time low; the share price of News Corp has fallen by almost 20% since the scandal started meaning billions of dollars have been wiped off the company’s market value.

2. Leadership failure to take responsibility: Rupert Murdoch IS News Corp and its brands to the public– they were immediately looking to him for a response. He shunned accountability by saying that he could not possibly know what goes on in an invidvidual paper – a comment that made him and News International CEO Rebekah Brooks seem like either incompetent leaders or just acting in their own self interests. Angry staff even recorded and leaked her speech to Sky News.

3. Lack of a credible spokesperson: Initially the media spokesperson, Simon Greenberg, was left to handle the media alone, giving the impression that leadership weren’t taking the issue seriously themselves. He couldn’t respond directly to difficult questions being thrown at him, particularly when public sentiment suddenly turned viciously against them in light of the Milly Dowler and London bombing victim revelations. Read More »

It’s baseball season in Chicago and hope springs eternal on the North Side.  But as the Cubs chase the impossible dream of a World Series, communicators confront their own impossible dream – how do we measure the un-measureable: the value we create from all the stories that didn’t get written about us this year.

So it wasn’t until opening day that I realized the goal is similar to the efforts of advanced baseball statistics, which try to more completely capture a player’s value by comparing his contribution to a replacement. The only difference is that in baseball a replacement still generates some value whereas in communications the replacement actually reduces a company’s value by allowing negative coverage.  But while baseball statisticians can’t add up the hits of a replacement that doesn’t actually play any more that communicators can count the articles that were never written, they know they get pretty close by merely calculating the average or expected value of the replacement. So if communicators can focus on just an expected number of mentions, we can similarly develop a more accurate representation of our value.

Read More »

By Kirsten Robinson

Graphic and disturbing footage of Japan’s earthquake and ensuing tsunami serve as a solemn reminder that large-scale crises can—and will—occur at any time. In the aftermath, tens of thousands of stranded office workers wandered the streets of Tokyo, searching for transportation and a way to contact relatives.

Good communication is absolutely critical in a crisis situation. Not only as a means for people to speak to loved ones, but to also enable them to get critical information when it’s needed most. In the wake of recent natural disasters, communicators must ask themselves—are we well-equipped to communicate with employees in a time of crisis? An executive in our Employee Communications Forum recently posed a similar question, spurring a collective of insights from other members.

Here are a few takeaways from the discussion about how other member companies utilize crisis alert systems:

• Mass Broadcast. Sending text messages, pages, e-mails and automated phone calls to pre-set distribution lists, “robo call” systems cover multiple bases with one tool. One executive’s company uses a mass broadcast notification system provided by Everbridge, which enables companies to set up user profiles specifying how individuals prefer to be contacted.  A PA system, while only useful during business hours, lets Communications reach out to the entire organization in a location at one time. Read More »

When crises like the events in Japan strike, corporations play a number of vital roles in helping society to respond effectively.  We, as large organizations, are an important social network that helps authorities account for those most affected. We are a communications channel to provide critical emergency instructions to affected areas. We are a trusted source of information in a cluttered environment. Our resources provide the technology, supplies, and expertise to support immediate relief. Our employees and foundations donate significant aid funds. Our early statements shape policy discussions to minimize future disasters. And, lastly, our collective response efforts ensure global economic continuity and minimize collateral damage.

Strong communication is at the center of all this. While specific responses will vary by organization, it’s vital that we share ideas and best practices to serve societal (and business) interests. I’ve started to collect a few of these priorities and ideas – please help others by sharing what you’re doing.  And let us know what questions you have for your peers.  Read More »

As I kept an eye on the nonstop coverage of the tense situation in Egypt, there was a moment where I suddenly felt like things just might be OK.  It was the footage of Egyptian Gen. Hassan Ruwaini—older and balding and looking highly breakable—wading  his way through crowds of protesters.  But his manner was very un-general-like.  He might have been President Obama shaking hands and kissing the occasional baby as he worked his way through the throngs.

Reporters on the scene witnessed the larger story behind the footage.  For a great account, check out LA Times coverage: http://articles.latimes.com/2011/feb/06/world/la-fg-egypt-army-scene-20110205

When Gen. Ruwaini first faced the clamoring crowds of Tahrir Square, he had the presence to wait out the onslaught of verbal attacks for a chance to address the younger protesters who had started the revolution.  He first applauded them for their courage and expressed his affection for them as youth of Egypt, assuring them that he had no intention of turning military force against them.  He then called them out for certain hooligan behaviors, and warned them to be careful not to become pawns of the political parties.  Next came perhaps his most glorious moment—he sat on the roof of his car and simply listened while the crowd passed around his microphone and protesters vented all their anger and frustration.  When they’d finally simmered down a bit, he and his soldiers pressed their way past the protester-constructed barriers around Tahrir Square and entered the crowd to continue his listening campaign and establish the military presence as a peacekeeping force rather than a threat.

Whether Gen. Ruwaini had been reading the CEC web page or not, I can’t verify.  But his actions are a great example of best practice for communicating with stakeholders in a time of uncertainty or crisis. Read More »

When you don’t have anything nice to say, should you say anything at all? What if you don’t want to draw attention to something that will just disappoint people? Can we keep our mouths shut?

We live in a world that expects open communications. This means that as communicators, we constantly face the tough balancing act of: communicating the truth, communicating what is most relevant to stakeholders, AND knowing when to communicate at all.

For example: How often do the following words come into a consumer’s mind when they are shopping in a retail store? 

Floods. Labor markets. Paksitan. China. Supply chains.

Very rarely. These are not typical thoughts in a shopper’s mind when they are searching for a good deal on the latest trendy sweater, cute T, or pair of athletic socks. But for a large number of retailers, the 15-year high in the price of cotton due to abnormal floods and droughts in Asia is no longer a bearable dent in their supply chain costs. As prices for 2011 are set, many retailers are preparing for shoppers who will see a small to mid-sized price increase in clothing. In speaking with communicators facing this situation we are hearing valid questions like, “Is this something they need to know?” or “Would we be better off if we don’t draw attention to the situation?” Read More »

It took only one trip back to Philly to remember what a crisis a bit of snow can be.  You could hear pins drop at a typically raucous hour, as the Eagles game had been postponed.  American Airlines cancelled my Monday flight, insisting I had no way out until Friday.  And most crippling of all (particularly for kids with brand new presents), the power was out at my family’s home.  Some cities are ready to handle the snow and some aren’t, but what the latest “snowpocalypse” really showed is what a leader should do in such a crisis.

Consider the following three profiles that emerged from the chief executives of New Jersey, New York City, and Newark as you think about directing your leaders in a crisis plan. 

Read More »