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Key Lessons In Crisis Management

Posted on Nov 18, 2011

Protect your company's brand, reputation and book of business

In the summer of 2008, Maple Leaf Foods faced a serious crisis when meat processed at a Toronto plant was contaminated with listeria. Dozens of people became ill and at least 15 deaths were linked directly to the tainted meat. It was a blow to the company’s reputation, brand and share price – yet many experts say the way Maple Leaf Foods handled the situation was a textbook example of how to manage media relations during a crisis.

From the initial press conference during which Lorne Honickman, partner at Toronto-based McCague Borlack LLP, points out that CEO Michael McCain got two critical messages across – that the company had excellent quality control but even that was no excuse for what had happened – to full-page newspaper ads four months later that bravely reminded the public the company hadn’t forgotten the incident even though it had faded from the headlines, Maple Leaf Foods was clear about its responsibility and expressed deep concern for the families its products had hurt.

“We can talk about a variety of things that are important to do in crisis communications, but sincerity is absolutely the number one thing,” says John Larsen, principal at Calgary-based Corpen Group Inc. In the case of Maple Leaf Foods, Larsen says, “Sincerity is what won the day.”

Decide who speaks for your company

Sincerity, by definition, can’t be faked so one of the first steps companies need to take when preparing their media response to a crisis is to choose a spokesperson carefully.

“You don’t want some cold, corporate, starched type up there in a shirt and tie with a somber suit, reading from a script,” says James Gregory, regional director, AON Crisis Management. “They need to come across as genuine and really meaningfully concerned with what’s happening and how the company is going to respond to make sure that consumers of their product are protected.”

Larsen says that a public relations person can be an effective spokesperson in situations where a company is simply communicating facts such as evacuation details. However, where there has been loss of life or significant loss of property, someone at an executive level – likely the president or CEO – is more appropriate.

“If you have people who have died, and you put a PR person out there to speak to that, it looks cold and callous regardless of how well that person might do their job,” Larsen says.

Honickman agrees that going to the top of the chain of command is often the best approach. “Choose somebody who will be perceived by the recipients [of the message] – shareholders, stakeholders, the public at large – as having a certain level of credibility in that company: the face of the company, the person who has, in the public’s mind and everybody else’s mind, as much at stake as anybody else,” he advises.

Also keep in mind that, whoever is chosen, the spokesperson must be able to display empathy – something Maple Leaf Foods’ McCain did extremely well. As Larsen puts it, “People want to know that a company cares before they care what a company knows.”

“No comment” is never the right answer

When the media come calling, Nicole Harris, media communications coach at Winnipeg-based Maverick Media, says the worst thing a company can do is “turtle” or refuse to comment. While you may not have all the answers right away, “you need to express empathy and concern, you need to show me that you are taking the matter seriously, and you need to be a fact-finder,” she says. Again, this is something Maple Leaf Foods got right.

Honickman emphasizes the importance of the two As – accessibility and availability – to burst the bubble of controversy. “There’s nothing more controversial than unavailability,” he argues, offering up Toyota and Tiger Woods as examples of brands that suffered because they were missing in action in those critical early hours and days.

“The greatest rock drummers of all time are those that, when you listen to them, are driving the beat. They’re just a little ahead of the beat. That’s what it’s like in messaging. You’ve got to be in front of it,” Honickman says.

Timeliness, agrees Larsen, is essential. “Don’t let the perfect be the enemy of the good … I’ve seen it, and it’s very unfortunate, where companies have worked very diligently to try and get the information, to try and put it together in a meaningful way, but that process has taken them two, three or perhaps four hours, and meanwhile they got eaten alive because they appeared to be unresponsive … Your effort has to translate into the public domain very quickly.”

At the same time, it’s essential to get the facts right. Harris points to BP’s early estimates of the number of barrels of oil flowing into the Gulf of Mexico after the Deepwater Horizon explosion. The actual volume was dramatically greater, and when the truth emerged it damaged BP’s credibility.

Some soul-searching may be in order too, before making a statement to the media. “If a company is facing a crisis situation, they have to be very, very honest with themselves about what their past history is,” says Larsen. In the case of BP, he says, the company’s previous record – which included a 2005 explosion at a BP refinery in Texas that killed 15 workers – was one of the “key narratives” the media latched onto.

Larsen regularly asks clients facing a crisis if they have experienced anything similar in the past, if they have had any safety infractions and if they have ever been fined. If the answer is “yes,” he probes to find out what improvements the company has implemented since then. Assuming they have taken steps to rectify shortcomings, he makes sure that’s part of the message that goes to the media.

Be prepared to tweet

Social media have had a significant impact on crisis communications. Today, information and misinformation can spread like wildfire and companies need to monitor the Internet carefully so they can respond effectively, Larsen says. In fact, he suggests, it’s not unusual for companies to learn about brewing crises through social media – for example, in an online conversation stream that attracts a cluster of customer complaints.

While Larsen acknowledges that the advent of social media puts additional pressure on companies, he emphasizes that the “glass half full” interpretation is that you have more opportunities to clarify misperceptions and engage instantly and directly with audiences. Maple Leaf Foods took advantage of this through regular updates to the company’s Facebook page and a powerful YouTube video released during the listeria crisis, according to Harris. Of course, social media opportunities add to a crisis communications team’s workload.

“We used to be able to work with traditional media, regulators and just a select group of stakeholders,” Larsen observes. “We now have to work with everybody instantaneously.”

Gregory says the key difference between yesterday’s traditional media and today’s social media is the speed at which news travels.

“The response has to be so much faster,” he says. “If you’re caught flat-footed in the era of Twitter and Facebook, you will be in big trouble … Things take on a life of their own and become fact even though they’re not [and] it can really damage a brand.”

Honickman agrees: “In the world of the Internet and the world of the blogger, you have thousands of publishers … Within literally hours, messaging from around the world can destroy a company. But if the company is out there and ahead of it and accessible, they can deal with those issues.”

Larsen recommends adopting a crisis communications strategy that overlays a social media response on top of effective traditional tactics. Both are important components, he says, because while many people still turn to traditional media for news, a growing number turn to social media to read and express opinions on a company’s response.

Always have a plan

Rather than taking what Gregory describes as the “we’re just going to cross our fingers and hope it never happens” approach, all companies should have well-thought-out media communications plans in place in case a crisis hits. A cautionary tale is that of Topps Meat Company, a large U.S. manufacturer of frozen hamburgers that faced a recall of 21.7 million pounds of beef for suspected E. coli contamination on September 29, 2007. Its response was so unlike Maple Leaf Foods’ accomplished performance that by October 5 – just six days later – the company had ceased operations.

“The corporate message was ‘Yikes! We have no idea what we’re supposed to be doing here and how we’re going to manage this process!’” Gregory recalls. “If you do it on the fly, you’ll get caught out.”

Harris agrees that it can be dangerous to assume the worst will never happen. “At some point and some time, no matter how well prepared or safety trained an organization is, something will happen or could happen, and in those times of emergency and crisis you need to be 10 steps ahead of the media, not 10 minutes behind,” she says. “You have to have a plan in place and everybody on that team needs to know what their direct role is and how they work together.”

A crisis communications team may include the president or CEO who serves as the ultimate operational authority, a crisis management team leader who coordinates the company’s response, a human resources officer who can work with affected employees and families, the risk manager and legal counsel, Harris suggests. Depending on the company, other areas may need to be represented too.

Once the team is in place, each individual must be permitted to do his or her job during a crisis, adds Larsen. “One of the things that executives sometimes do is they rush off the 50^th floor and they go right down to where all the emergency operators are and they start micromanaging things – and that is not the job of an executive. The job of an executive is to take one step back, empower their team to respond to the incident and then lift their head up and look out into the public environment,” he emphasizes.

The most effective way to free executives to focus on exercising leadership during a crisis is to anticipate crises in order to prepare thoroughly for them. Gregory recommends that key players, including the C-suite, have frank and forthright conversations about worst-case scenarios that could bring their company to its knees. Meanwhile, Harris helps her clients prepare for “smouldering crises” by interviewing representatives from different departments to identify a company’s vulnerabilities. The key is to build on this type of self-audit to conduct tabletop exercises and create comprehensive plans.

“If you can get yourself a crisis management plan in place that contains the issues of communication, brand management and brand rehabilitation, it’s like insurance,” says Honickman. “You are then able to deal with that crisis on a proactive basis whenever an event hits. That is a huge, huge advantage.”

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Crisis communication do’s and don’ts

Do:

· Respond quickly

· Take responsibility

· Show empathy

· Answer honestly

· Display confidence

Don’t:

· Avoid the media

· Admit legal liability

· Adopt a defensive tone

· Fudge the facts

· Fear saying “I don’t know yet”

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Alison MacAlpine on November 14, 2011

http://www.citopbroker.com/special-reports/stepping-up-to-the-mic-2956