Friday, December 31, 2010

Better Listen To Your Customers

In a recent Edelman Strategy One poll, 82 percent of Americans gave the country’s businesses a grade of “C” or LOWER and 61 percent said American corporations failed to meet their expectations in 2010.

In fact, the Edelman survey concluded that 40 percent of people answering the poll gave American businesses a letter grade of “D” or “F.” Only 17 percent awarded an “A” or a “B.”

More than 80 percent said they won’t change their mind about American businesses until they begin promoting ethical behavior, make products with fewer recalls and fewer mistakes, among other things.

You don’t have to rely on the Edelman poll to know how unhappy Americans are with their government and the corporate world. Talk to anyone, anywhere and it won’t take long before you hear horror stories about how some company or some bureaucrat ignored them, mistreated them, misled them, took advantage of them or otherwise failed to meet their obligations.

What does this have to do with crisis management?

A lot.

Two-thirds of all business crises are preventable. Many of them start out with small issues that someone should recognize and fix. So all the things consumers complain about are the very things that can snowball and cause a company a significant loss and/or damage to its reputation.

The other side of this coin is the lack of bankable GOODWILL.

When companies have a crisis and their employees or partners or customers or shareholders, or all of the above turn on them, a good supply of banked goodwill will go a long way toward helping them get through the problem and speed recovery.

You cannot bank any goodwill when your publics think you are unethical or they can’t depend on your service or products.

Tuesday, December 28, 2010

Two Certainties for the New Year!

Do you run a small business? An international conglomerate?
A not-for-profit? A Hospital? A manufacturing plant?

Whatever you do, there are two certainties you are facing in the New Year. You will depend more than ever on computers and social media, AND you face a greater than ever chance that someone will “hack” into your business or organization and do major damage to your reputation and your bottom line.

Bob Sullivan writes the Red Tape Chronicles for MSNBC.Com ( and he has identified ten things “web users should fear” in the New Year.

I recommend you read his warnings. But let me just touch on a few of his concerns with examples from our own clients.

So many young business people are bringing their social media practices to their work world and sometimes sharing way too much about their work and personal lives with their so-called friends on sites like Facebook and Foursquare. Sullivan warns that hackers will turn stalkers and use these sites to take advantage of you.

We work with a very talented and brilliant consultant who spent a number of years working his way up the corporate ladder of one of America’s best companies. He married late and had his first baby recently. He started his own consulting business and bought in to the “networking” idea. His new business “took off” and so did he. He was flying here and there weekly. In the early days, he posted on more than one social networking site that he was off to New York to meet a new client and how long he was going to be gone.

After watching this for a few weeks, I took a deep breath and called him and offered a “father’s perspective” as well as that of a frequent flier, too. I asked him if he was not at all concerned about announcing to the world when he was going to be gone and his wife and new baby were going to be home alone?

He scaled back his “sharing.”

Sullivan confirmed a great concern I have about “cloud computing.” If hackers and industrial spies and WikiLeaks can get in to government websites, major banking sites, and even disrupt a nuclear power plant – all facilities with what you would think was rock solid computer security – how easy will it be for your digital files to be compromised when you start keeping them and working on them on leased computer space on someone else’s servers?

And Sullivan raised another issue. What if your most sensitive documents are stored on someone else’s “cloud” and they raise the monthly rent, or you get behind in making your monthly lease payment, and all of a sudden they cut off your access to your own data? Ouch!

And off course, with the addition of all kinds of computer type programs on your mobile phones and devices in your homes, such as TV’s and even kitchen appliances, there will be “bad guys” looking for ways to compromise all those devices and take advantage of you.

I’m not suggesting we stop technological advances. I am suggesting we all use common sense and be very careful.

Horse thieves quit stealing horses after cars were invented and began stealing cars. Robbers gave up stopping stage coaches and began robbing trains. With each technological advancement there are people looking for ways to take advantage.

The best way to protect your digital data and important documents and sensitive communication is to not put them where anyone can get to them … or don’t write them down at all. So what if you have to pick up the phone or walk to the next cubicle to tell someone something sensitive. Sure it would be so much easier to send an e-mail or a Tweet.

Just remember, when you write something down, always assume that someone other than the intended recipient will see it, sooner than later.

Tuesday, December 21, 2010

Happy Holidays And Don’t Forget to Hang Up The Phone

The fourth largest pharmaceutical company in the world laid off more than 1,000 employees BY CONFERENCE CALL a few days after Thanksgiving.

I’ve been covering lay-offs and downsizing for 35-years and helping companies plan and execute big and small lay-offs for nearly 20-years. I have NEVER heard of a lay-off by conference call.

It’s bad enough that companies, encouraged by their accountants and CFOs, feel compelled to fire people just before Christmas. That’s insane in my opinion. But to do it on the telephone!?!?

Sanofi-Aventis, maker of Plavix, Ambien and Allegra, among other products, showed no sign of concern for its remaining employees, let alone the employees they didn’t need any more. They laid off 750 employees Thanksgiving 2009, more around Thanksgiving 2008, more last Christmas and a number of employees were shown the door July 4th weekend a year ago.

The CEO of Sanofi Aventis, Gregory Irace, issued a cold, hard statement this November, “Given the serious challenges facing our organization and the healthcare industry, it is important to act decisively now so that our organization has greater stability moving forward and that our resources are allocated to our strategic growth priorities.” Obviously, Mr. Irace’s priorities do not include his employees, even the ones who were notified by conference call, also, that their jobs were safe for the time being.

When we work with clients to plan and prepare for a significant lay-off, we always plead with them to have grief counselors available, both for those getting laid-off, but even more importantly, for those who will keep their jobs, while their friends and co-workers are on their way out.

There is a terrible feeling of guilt for those who remain. They feel bad that they still have a job while their co-workers don’t. Then anger strikes. The remaining employees are faced with having to work harder to make up for the workers that are no longer there to help. Guilt and anger are two very powerful forces working to undermine productivity. And a decline in productivity means an increase in costs and a decrease in profits.

A company spokesperson argued there was no other way to “quickly and consistently” notify hundreds of American employees that their jobs were being eliminated. Shel Holtz’s podcast on the “conference call lay-offs” put it simply, “The truth is they were too lazy to come up with another way,” he said.

Lazy is probably more forgivable than the cold-heartedness that drove the decision.

There are a number of cost-effective and coordinated lay-off scenarios. All of them allow a company to treat its employees with dignity and compassion. They require a little planning and preparation, but that pays off in the long-run.

What happens if business rebounds and you need to hire some of those workers back? What if business improves and your remaining employees find places to work where they will be treated better and bail on you?

This makes Scrooge seem like a nice old man.

Thursday, December 16, 2010

Are You Ready for the Two Cs?

Are you ready for Christmas? Are you ready for a crisis?

In my experience, the two tend to occur in very close proximity to each other.

Some of the most tragic business crises the Institute for Crisis Management has been called to help with, involved the Christmas/New Year holiday.

One of the most tragic was a workplace violence incident the day after Christmas in the main offices of a wonderful company in suburban Boston. If you were ever going to convince yourself that “nothing bad is ever going to happen to my company” this one would have been it.

On Christmas day, a troubled and unhappy employee brought an AK-47, shotgun and semi-automatic pistol and gym bag full of ammunition into his office and hid them under his desk.

The next day he went hunting in the building and killed seven co-workers.

The leadership of the company was outstanding. They cared about their employees and provided a challenging, but pleasant work environment.

The unexpected violence and trauma touched everyone from the CEO to the newest hire.

The company did not have a crisis plan, but had a leadership team that knew what it needed and reached out for help. ICM was one of the companies that responded to the call. And the top managers did almost everything right.

They treated their employees with care and support, the victim families with respect and tenderness, their vendors with concern and their clients with openness.

When the dust settled and management began to restore operations, everyone was ready and willing to support the leadership and the company came back stronger than ever.

I hope you have a crisis operations, communication and recovery plan. And, I hope you have our number handy: 888-708-8351.

Merry Christmas and a Happy New Year!

Friday, December 3, 2010

Fire In Israel Is Lesson To Business Everywhere

The horrific forest fire that leveled more than 12,000 acres and several villages near Haifa in Israel, killing at least 41 people, should be a lesson to business owners/managers/executives and the leaders of every other kind of organization, everywhere, that they need a crisis plan!

You do not have to have a crisis of your own, to have a crisis.

What may have started as a “trash fire” forced the evacuation of a university, three prisons and a hospital. A bus-load of prison guard cadets died when the bus taking them to fight the fast spreading fire overtook the vehicle and consumed it quickly.

Several local businesses were leveled and life was disrupted for thousands in and around Israel’s third largest city, Haifa.

When we help a client prepare a crisis plan, we always recommend a section for “someone else’s crisis.”

We’ve had manufacturing facilities shut down because a neighboring plant had a spill and the local fire department ordered an evacuation of all surrounding facilities. It doesn’t have to be a crisis of your own, with the reputational damage that goes with it. It can be a significant disruption of your operations because of someone else’s problem.

You will still have to have an evacuation plan, an internal as well as external communication strategy, and continuity and recovery plan.

We have worked with a major pharmaceutical company. If they have a power outage or otherwise some disruption to their manufacturing process, they may have to shut down everything. That means a major loss of a valuable batch of product, which leads to a major clean-up and sterilization of the production line -- all-in-all, an unplanned loss of as much as hundreds of thousands of dollars.

If you manage a small business, a medical practice, a hospital or school, or any kind of organization, you should have three crisis plans:

1. An operational crisis plan – what do you do when someone pulls the fire alarm, a tornado takes the roof off, flooding overcomes your facility, someone with a gun storms into the building, or any number of other “sudden crises” strike?

2. A communication plan – who do you need to communicate with, who is going to speak for your organization, what are they going to say, how are they going to deliver the message, who has the final say on what is said?

3. A continuity and recovery plan – how do you get through the immediate disruption and how do you get back to normal operations?

In the best of all worlds, those three plans should be integrated into one comprehensive plan.

And, be sure and anticipate someone else’s crisis causing a major headache for you.

Tuesday, November 30, 2010

Could the Bank of America be the next target of Wikileaks?

What about your company?

A year ago, Wikileaks founder Julian Assange claimed to have in his possession a ton of digital data from a Bank of America executive and this week he reportedly promised to post some company’s confidential documents as his next act, following his most recent posting of diplomatic documents.

The disclosure of thousands of secret messages among U.S. officials and diplomats, has set the press and world capitols in a frenzy.

And that raises the question, how would your business or organization deal with the publication of controversial documents stolen from your computers?

You don’t have to be a super bank outed by Wikileaks. You can be a small or medium size business with a disgruntled employee and find your confidential and sensitive inter-office communication on the front page of your local newspaper, on the 6 o’clock news, or buried inside the Wall Street Journal.

What would you do? Who would you call? How would you respond?

Where would you find enough antacid tablets to get you through the initial publication and then the follow-up reaction from employees, customers/clients, partners, vendors, investors, AND the media?

As Scott McKain says, “It’s easier to PREPARE and PREVENT, than to REPAIR and REPENT?

Monday, November 29, 2010

Is Social Media In Your Crisis Plan?

If you are the chief communications officer – what used to be called the director of communications, or something similar – of your company or organization you have a slightly greater than one-third chance of facing a social media crisis, according to the annual Rising CCO III survey created by the executive search company Spencer Stuart and Weber Shandwick.

According to the recently released survey, 34% of chief communication officers reported their companies faced a “social media based” threat to their reputation in the past 12 months. And it was no surprise that 33% said they were not prepared to manage a social media crisis.

A bit of good news appeared in the survey finding: Crisis/issue management is an increasingly more important skill for future communicators. It is nearly twice as important according to the new survey compared to the 2007 survey – 33% then to 61% now.

Social media and blogging are gaining in relative value to communications officers, increasing from 28% in 2008 to 41% in importance in 2010.

Social media crises are a growing area of focus in the Institute for Crisis Management’s ICM Crisis Certification Course ( as well as in custom crisis planning and training offered on-site to client organizations.

Tuesday, November 23, 2010

TSA's Pat Downs Create New Target for Terrorists

The Transportation Security Administration says there is credible intelligence information that indicates there will be more attempts to smuggle explosives on commercial airliners in the undergarments of suicide bombers.

As a result, a growing number of airports ranging from the small airport in Fort Wayne, IN, to Cincinnati-Northern Kentucky International Airport and Reagan National Airport in Washington, D.C. now require passengers to step into a scanning device that uses x-rays to see through your clothing. For safety reasons and for modesty, some passengers are refusing. They have the option of being thoroughly "patted down" in and around women's breasts and men and women's waist and underwear.

There has been a small uproar about the up-close-and-personal searches.

While contemplating my next air travel, a horrifying thought struck me.

Suicide bombers have reportedly strapped on explosives and boarded airplanes with intent to kill 200 fellow passengers.

What is to prevent one of those men, about to be searched in the security check-in area of a crowded airport from detonating that explosive and killing 200 people right there? The object is not necessarily just killing heathen Americans, but to spread terror across the country. That's why they are called terrorists.

The publicity that would follow an attack in LaGuardia Airport in New York City would rival the downing of the twin towers on September 11.

I hope TSA has a plan for that.

Do you suppose we'll get to the point in the United States, that if we plan to travel by air, we'll have to make an appointment for a TSA officer to come to our home and watch us get dressed, to make sure no one brings anything dangerous to the airport?

Saturday, November 20, 2010

TSA Lessons For Your Business

If your company or organization must make changes to meet a growing threat in your area of operations or service, make sure you have the people with the expertise and experience to lead your project, and if you do not have the experience in-house, then for goodness sakes, go outside for it.

When TSA rushed their new "pat-down" procedures in to operations this week, you would have thought they would have considered all the complications their new "security grope" would face.

In fact, they've had weeks to prepare to step up their so-called pat down procedures since the underwear bomber failed and months since the shoe bomber failed.

Did no one consider all the implants and medical devices that humans wear to stay alive, or just to appear more normal after life-threatening disease, accidents or surgery?

There was the flight attendant that had to remove her breast prostheses, in front of a line of waiting passengers. She had a breast removed because of cancer.

And the guy that wore a urostomy bag on his waist because he had no bladder, after surgery. What are they doing about the men and women who wear colostomy bags because they've had colon or rectal cancer?

I few years ago I had a wreck and had a number of screws holding my left foot together. I fly a lot. It was a nightmare then, because I always got pulled out of line and had my whole body wanded, because of hardware in one foot.

My late father-in-law wore a urostomy bag. Thank goodness he's not around to have some TSA agent squeeze it or hit it and knock it loose, dumping his "water" in the airport security area. At least, under the present rules, his shoes would not be soiled.

Back to your business. TSA apparently did not have the medical expertise on staff to help them with those kinds of issues.

There will be things you have to do to keep up with the competition, or ahead of the competition.

A crisis plan is one of those things. Most companies and other organizations rarely have the expertise on staff to prepare a crisis plan without missing some important elements. Don't pull a "TSA" and adopt a crisis plan that has flaws.

Call the Institute for Crisis Management or someone like ICM to help you with your plan development or updating.

Tuesday, November 9, 2010

Caught Between the Devil and the Deep Blue Sea

3,299 paying customers and 1,167 crew members found themselves literally between the devil and the deep blue sea when the Carnival Cruise Liner Carnival Splendor was disabled by an engine room fire and left adrift 55 miles from the coast of Mexico.

Fortunately no one was injured. Unfortunately the fire left the big luxury liner adrift without power, steering, air conditioning, hot food, hot water, telephone or Internet service.

Tug boats were originally dispatched to tow the ship to Ensenada in Baja.

From Carnival Cruise Line’s public relations perspective, they faced two potential "bad choices" -- a disabled ship or having to tell more than 4,400 people they are going to be towed to Mexico. With the daily headlines about drug wars, Mexican shoot-outs and entire Mexican police departments either being murdered or quitting their jobs before they are murdered, many on board that ship might rather endure the dark and lack of air conditioning for a few days.

Within hours Carnival’s website had updated a message to friends and family of the passengers and crew, and future customers, about what had happened and what the company was doing to make good for those who had paid to take the seven day cruise.

Then, a day later, the company and Coast Guard announced they were changing plans and the big ship would be towed to San Diego. That avoided the potential negative reaction of all those people going ashore in Mexico, but the ship, under tow, is moving at about four-miles an hour, and the trip to San Diego was expected to take two to three days.

We maintain that two-thirds of all crises are preventable, but every now and then something will go wrong that cannot be avoided. That’s when you have to have anticipated those kinds of things and have three plans to deal with it.

The first plan is the operational plan: how to fight the fire, how to keep everyone safe.

The second plan is the communication plan: how to communicate with the people directly involved, how to communicate with their families, and others.

The third plan is the continuity and recovery plan.

BP Comes Through for Us Again

BP’s former CEO Tony Hayward has given us another teachable moment!

In an interview with the BBC, Hayward has conceded his company was not prepared for the disastrous oil rig explosion that left eleven workers dead and an oil spill that seemed to go on and spread forever.

He also confessed, the media frenzy that followed was bad enough, but the giant oil company faced financial ruin for a while because no one would loan them money to help cover the millions of dollars in daily losses BP was facing.

Hayward admitted the company’s contingency plans were nowhere near adequate and he told the British reporter “we were making it up day to day.”

And Hayward’s successor Bob Dudley confirmed to the BBC, ‘With a company the size of BP, its reputation, what it does – you almost can’t quite believe how close you are” to financial disaster.

The lesson is simple and stark: Imagine the worst thing that could ever go wrong with your organization and then imagine something a little worse. Then plan how you would manage that.

Plan for the operational part of the crisis. Plan for dealing with the communication challenges with employees, vendors, customers/clients, investors and regulators. Then develop a plan to help you recover from whatever can go wrong and return to near normal operations as quickly as possible.

Don’t get caught with your proverbial “pants down” like BP did.

Wednesday, November 3, 2010

Celery strikes again!

Why does it seem like so many processors of celery are mad at us and want to kill us?

The U.S. Food and Drug Administration has officially linked four deaths to contaminated celery processed in the SanGar Produce and Processing Co. plant in San Antonio, TX.

The state had closed the plant Oct. 20 and ordered a recall of all produce shipped from there since January. A few days later, the President of Sangar said independent testing found company produce was -- in his words -- "absolutely safe." And he vowed to "aggressively" fight the state's erroneous findings.

Now the feds have piled on and confirmed what Texas had already found.

Today, the company attorney declined to comment, claiming the Food and Drug Administration had not shared their findings with the company.

If you are in the food processing, selling or serving business, you can anticipate that at some time, you're very likely to ship or serve some tainted food products. And since it's a likely occurrence, you should have a crisis communication plan ready to activate, with a trained spokesperson ready to respond.

That plan should anticipate the likely foods that could be tainted; what you're going to do about it; who is going to speak for the company; what are they going to say; and how are they going to reassure employees, suppliers, customers and bankers or investors that you're going to fix the problem and work even harder to prevent another occurrence.

Monday, November 1, 2010

What were they thinking? Again!

With little more than two weeks to go before the election a Canton, Ohio McDonald's franchisee stuck a memo in its employee pay envelopes, using the McDonald's corporate logo, advising them to vote for three Republican candidates in the November election.

The memo said “if the right people are elected we will be able to continue with raises and benefits at or above our present levels. If others are elected we will not.”, in a blog post, accused the company of trying to “take over the world one minimum-wage vote at a time.”

The local franchisee, Paul Siegfried issued a statement saying to ”those I have offended, I sincerely apologize.” Never mind what he did was probably against state and federal election laws.

One lawyer is already threatening to sue him and McDonald's.

Then go back a couple of months when Target donated $150,000 to a campaign for a conservative Republican Minnesota gubernatorial candidate who opposes gay marriage.

Independent and Democrat customers in Minnesota have started shopping elsewhere, while the CEO of Target, Gregg Steinhafel doesn’t seem to understand what the big deal is. Not only is the GOP candidate against gay marriage, he supports strict illegal immigration laws, and once advocated chemical castration for sex offenders.

Steinhafal issued a statement saying, “Let me be very clear, Target’s support of the GLBT community is unwavering, and inclusiveness remains our core value of our company.”

He should have added, “with the exception, of course, of the candidate we supported with our $150,000 donation.”

Mike Dean, head of the advocacy group Common Cause Minnesota, appealed to businesses and unions to think twice before donating to campaigns. “Just the reputation damage” this is doing to some companies, he said, “should be a compelling case of why these corporations should not give.”

Wednesday, October 6, 2010

Lessons from the Campaign Trail

It doesn't matter whether you are a campaign manager or running a small business or big one, there are two lessons from the Delaware Senate campaign I want to draw to your attention.

It's generally OKAY to politely decline invitations to be interviewed by reporters and commentators who you know will not treat you even remotely fair. We at ICM have counseled clients to decline invitations from Bill O'Rielly's schedulers and a small handful of other polarizing and argumentative interviewers.

And we always encourage the client to be polite and thank the caller for thinking of them and respectfully decline.

Producers for the Rachel Maddow Show on MSNBC were turned down when they initially sought to profile Delaware's Tea Party senate candidate Christine O'Donnell. They went ahead to Delaware to do a profile on Chris Coons, O'Donnell's Democrat opponent.

While they were there, they found O'Donnell's campaign headquarters and executive producer Bill Wolff (WITHOUT CAMERA) was "buzzed" into the building.

Two men, who appeared to be PR types he said, came out to talk to Wolff and after he identified himself, ask again for access to the candidate or someone who could speak for her. A third man appeared and told them their request was "unacceptable."

And then the representative of the O'Donnell campaign offered a sort of explanation for turning down the request saying to the producer, Maddow was "classless" and had trashed their candidate.

Again, it was probably appropriate to decline the interview request, but there's an old saying, "don't get in a pissing match with the people who buy their ink by the barrel newspapers) or own the big stick (TV stations) at the edge of town."

They will always have the last say!

What the O'Donnell campaign person did was give the Rachel Maddow Show a free shot at the campaign. They didn't storm in with cameras running. One man walked in and asked again, if they would reconsider the request for an interview. He basically was insulted and shown the door.

The campaign did not need that negative kind of story. But they got it. A simple "no thank you" would have guaranteed a line in the Delaware Senate Campaign profile saying Christine O'Donnell refused to talk to Rachel Maddow."

I hate it when that happens, but the explanation the unnamed campaign representative used was even worse.

Thursday, September 16, 2010

Why Do Some Companies Survive Crises and Others Don’t?

I sure wish I knew for sure.

It is obvious in many cases. The organizations that were prepared and had a plan and practiced with it, almost always come out on the other side on their way to recovery, even if the disruption was of their own making.

It is equally obvious when a company screws up, doesn’t know how to manage it, doesn’t take responsibility and doesn’t know what to do and say, or refuses to do the right things.

Then there is Toyota, BP, Firestone and Exxon.

Ten years ago there were many who had written Firestone off – history, gone, done, stick a fork in ‘em! It was the second time in less than 20 years that Firestone had a defective product and major tire recall. They almost disappeared after the Firestone 500 Tire recall, but Japan’s Bridgestone Tire Company bought Firestone in a “fire sale” and kept it afloat.

Then in the 90’s management ignored all the warning signs and continued to sell the Firestone ATX tire even after reports it was causing Ford Explorers to crash and kill and injure people. All of the lawsuits in that 2000 recall have not yet been settled.

Exxon’s Valdez oil spill in 1989 was the epitome of an environmental disaster up to that time.

Bob Irvine, founder of the Institute for Crisis Management, was in Alaska for several weeks assisting another company that feared fallout from Exxon’s spill. He says Exxon did a really good job of cleaning up the bay, but did a poor job of communicating what happened, what they did and what they were going to do. He stood on the shore one day with an Exxon senior executive and suggested they needed to do a better job of telling their side of the story.

The Exxon executive looked up at Bob and said “we don’t have to say anything all we have to do is a good job.” That didn’t work for them.

Yet Exxon survived and is one of the most profitable companies in the world, even though they are still vilified by people around the world.

The BP story is still being written, but there’s little doubt the company will survive and continue to be profitable, even while being the butt of criticism and possibly hundreds of lawsuits for years to come.

Toyota is another recent case.

When the year began with a massive automobile recall of nearly 10-million vehicles, Toyota lost $30-billion of its “value” in a matter of weeks, but by August, the company was recovering.

Toyota is a little easier to understand. It is a company with a ton of banked goodwill and a solid reputation. It took a hit and it has a long road to recovery, but it will make it, unless management takes its eye off the ball again.

Sunday, September 5, 2010

On Second Thought, Hospital Did Not Handle Crisis Well

A 7-month-old boy from Indiana died in a Cincinnati Hospital last month, after his body was mistakenly flushed with alcohol instead of the prescribed saline solution.

Tressel Meinardi of Richmond, IN was in Cincinnati Children's Hospital for heart surgery when the alcohol was mistakenly pumped through the little boy's body causing his organs to fail.

Hamilton County, Ohio Coroner O'Dell Owens confirmed the hospital notified his office that someone on the hospital staff had accidentally used alcohol instead of saline solution during heart repair surgery. The infant was born in February with a heart defect.

Owens says the hospital was "upfront" with the family and his office, admitting the "alcohol was the cause of death."

Apparently some days after the death, the Hospital President Michael Fisher circulated a memo to staff saying he could not disclose details, alluding to hospitals' old standby excuse that HIPAA, a federal patient privacy law, prevents them from giving even basic public information.

But the internal staff memo said, "Families have the right to know their child's medical status, treatment and outcomes. In cases where there has been an error, we accept responsibility, admit the error, apologize for it, and explain what happened."

However, the memo doesn't appear to take responsibility, nor does it confirm an error was made nor "explain what happened."

Even his statement of sympathy was somewhat backhanded: "Our thoughts and prayers are with the family of this child, with our caregivers and the entire Cincinnati Children's family. This is a difficult time for many."

When I first read about the death and the hospital's internal communication I thought they were off to a relatively good start in managing this tragedy. But after I went back and read the only public statement I could find from the hospital, I had second thoughts.

The internal memo appears to have been written by a lawyer with fears of a medical malpractice lawsuit hanging over his/her head.

The next challenge for the hospital administration comes when the Coroner reveals what went wrong, or the first lawsuit is filed. These kinds of hospital "accidents" were more common in the past, but a nationally publicized operating room "mistake" a number of years ago prompted most hospitals to change a procedure that had been subject to such accidents and ignored for ages.

Medicines and other solutions were poured out of clearly marked containers into bowls to make it handy for the nurses and doctors to access them during the press of the operation or procedure. It was easy for the bowls to get mixed up and patients to pay with their lives.

If that happened in this case, the staff and hospital malpractice rates will go through the roof. Not to mention the hospital's reputation plunging into to the toilet.

Thursday, August 19, 2010

Not Getting The Cart Before The Horse

Johnson & Johnson, the giant health care company, known for Tylenol, Motrin, St. Joseph Aspirin and Band-Aids, appears to be headed in the right direction with its low-key appointment of Vice President Ajit Shetty to a newly created job overseeing company wide quality, manufacturing and compliance issues.

J & J is apparently also appointing chief quality officers for all three of its major business units, pharmaceuticals, consumer products and medical devices.

In the past year, J & J has had eight recalls, involving millions of bottles of Tylenol, Motrin, aspirin, Benadryl, Rolaids and Simply Sleep pills.

The recalls were triggered by bacterial contamination, a terrible smell on containers, and fears that some of their liquid medicines might contain metal shavings.

So often, when a big company faces a business crisis, one of the first reactions is to throw a public relations campaign at consumers.

We, at the Institute for Crisis Management, usually counsel a client to explain what went wrong and to communicate how sorry they are that they let their customers and investors down. Then, set out to "fix" the problem or problems, before launching a communication strategy to explain what they are doing about it.

J & J seems to be going about "the fix" in the right order. Correct the problems and talk about it after you have something to talk about.

A plant in Washington, PA and another in Las Piedras, Puerto Rico were sources of some of the problems that led to the recalls. The Pennsylvania plant was shut down in April and it has been reported it will not reopen until it is cleaned up and improved.

When Associated Press reporter Tom Murphy ask J & J for details, company spokesman Bill Price simply said the appointment of the quality control officers is part of a "more comprehensive remediation plan."

I would expect (and hope) that in the near future, the company will begin to communicate with key audiences -- including employees, investors and customers -- more details about the actions that have been and will be taken to improve quality and reassure those key stakeholders that J & J can be trusted to provide a good place to work, quality health care products for families, and a good investment for shareholders.

Tuesday, August 10, 2010

What Kind of Severance Package Do You Have?

Normally I get paid to provide answers and counsel, but I have to admit, in all my 50 years of communication work, I still don’t have a good answer to why a company will fire a low level employee for stealing paper clips but give the CEO $28-million in cash and stock for filing “inaccurate” expense reports – particularly when he’s a multi-millionaire -- which raises another question, why does he need an expense account for taking anyone to lunch or dinner?

As MSNBC contributor Eve Tahmincioglu observed, “ . . . senior executives like (HP CEO Mark) Hurd play be a different set of rules, often hammered out years earlier by expensive lawyers.”

Now, here’s where my experience does come into play.

Companies of all sizes will pay big bucks and make concessions to hire someone they believe will make their company better and more successful. That is defensible.

However, what is not defensible, is giving away the store to that same leader, later, to the embarrassment of the rest of management, employees, stockholders and other key stakeholders.

Within hours after H-P confirmed CEO Hurd was leaving, Hewlett-Packard stock fell 8-percent in heavy trading.

That’s nothing compared to days of publicity linking Hurd to a former B-movie actress and “hostess” his company had hired to meet and greet guests to company hospitality rooms. It also resurrected stories about how Hurd had “revived” H-P by buying competitors and slashing payroll.

As Drucker Institute Executive Director Rick Wartzman concluded, “. . . there’s something wrong with laying people off and walking away with a princely sum like that.”

If you’ve heard me speak or attended any of our training, you know that our research shows two-thirds of all crises are preventable, and management denial is one of the contributing factors to corporate crises. Companies approve these outlandish severance deals without ever considering that this rising corporate star could turn out to be a “falling star” some day.

I didn’t stay in a Holiday Inn last night, so I’m not qualified to give legal advice, today, but I’ve worked with lawyers – many good ones – for years and I suspect you could create a single sentence, or at least a page of solid reasons why a company would not have to pay any severance compensation, let alone an outlandish pay package in certain circumstances.

Hurd and H-P are not alone, and in almost every case, the offending company suffered terribly negative publicity as a result.

Robert Nardelli was forced out at Home Depot and left with a package worth $210-million. Merrill Lynch’s bottom line was headed for the toilet when Stan O’Neal was ousted with a $160-million cash, stock, options and retirement package.

And poor BP CEO Tony Hayward will probably end up on food stamps. He only received about $1.6-million in severance pay, plus a pension worth an estimated $16.8-million. But wait, BP gave him another high paying job, with another salary, on top of all that. Forget the food stamps.

Thursday, August 5, 2010

Lesson from BP and Transocean

BP and Transocean Drilling Company continue to be among the all-time greatest examples of what the Institute for Crisis Management has been teaching and preaching for nearly 25 years.

Most crises are predictable and preventable.

In the just published New York Times article “Gulf Oil Rig’s Owner Had Safety Issue at 3 Other Wells” Transocean’s own review of safety issues and practices revealed there had been an earlier problem with the Deepwater Horizon’s ballast system in
2008, and more than 70 workers were evacuated when the ballast system flooded and the rig began to list to its side.

There were apparently other warnings and signs of potential disaster, including reports that concluded there were “. . . critical equipment items that may lead to loss of life, serious injury or environmental damage as a result of inadequate use and/or failure of equipment.”

All of those things happened as a result of an explosion on the Deepwater Horizon April 20.

At least two-thirds of all business and organizational crises are what we call “smoldering” crises. They start out small and are almost always the kinds of problems that someone should spot and fix or report to someone who can fix it.

In the case of BP and Transocean, there is growing evidence that company employees “spotted” problems and told someone who could take action. But, so far, there is no evidence the reported deficiencies were fixed.

The cost to both companies is mounting into the billions of dollars, and the lawsuits and criminal and civil cases are still months from getting to a courtroom and the cost of defending those will certainly be astronomical.

Please, please, learn from other’s mistakes. Pay attention to the little things in your organization. If someone alerts you to a possible problem, deal with it immediately. You can save your company or organization hundreds, thousands, millions or possibly billions of dollars and its reputation.

If you’re big, like BP or Exxon, maybe you can afford that kind of loss. If you’re a small company or organization you may not be able to survive even a loss of hundreds or thousands of dollars. You don’t have to if you are constantly looking for the little problems and dealing with them as they pop up.

Friday, July 30, 2010

Final Thoughts on BP's Hayward, Hopefully!

Today, Tony Hayward, who resigned as CEO of BP, says he has been turned into a "villain for doing the right thing."

We don't know if he did any of "the right things" in the days leading up to the Deep Water Horizon explosion and sinking or the 100 days that followed. We do know that he kept saying things that did not play well with any of his important American audiences.

Hayward told the Wall Street Journal this week he did everything possible, including taking responsibility for the spill and committing billions of company dollars to the clean-up and efforts to cap the leak.

I've commented about Hayward's biggest, known mistake before. I am compelled to write about it one more time, because it is so important, and owners, managers and top executives of all kinds of companies fail to understand.

The top person in any organization should NOT be the on-going spokesperson in a crisis. There is almost always a time and place for the top dog to speak briefly and make a significant statement. But, never, never should that top leader take the chance of misspeaking on a continuing basis during a crisis.

Besides, the CEO has a big job managing the company through a significant disruption, and that usually takes all their time, focus and effort. A chief spokesperson has a big, all-consuming responsibility also. I don't know many people who can do both effectively.

Wednesday, July 21, 2010


A rightwing blogger started it, some of the national media piled on, including FOX News, and then the Secretary of Agriculture and the President of the NAACP got sucked in.

And Mrs. Shirley Sherrod was the piƱata, getting smacked around by all of them.

The “former” USDA employee was forced to resign from the Agriculture Department almost immediately after Blogger Andrew Breitbart posted an edited and misleading video of comments Mrs. Sherrod made at a local NAACP meeting in Georgia last March.

The 2-minute, 38-second video was lifted out of a longer speech she made. It made it sound as if years ago, she failed to help a white farmer who was about to lose his farm. She said she was tempted to do less than was required by her job more than 20-years ago,to help the man because he was white and because whites in the South had treated blacks that way in the past.

Without hearing the rest of the “lesson” that she was trying to convey, the President of the National NAACP was put on the spot by reporters and he quickly condemned her statement as racist and called for her ouster. Agriculture Secretary Tom Vilsack quickly responded to the reports of her so-called “racists” remarks and had Mrs. Sherrod’s supervisor call her in her car and ask for her resignation.

The full video later turned up and was forward to the NAACP and some news rooms. NAACP President Benjamin Todd Jealous said his organization was “snookered” into reacting. And the Obama Administration, which publicly supported the Secretary’s actions, based on the misleading and out-of-context reporting by Fox and others, ended up with egg on its face, as did Jealous and Vilsack when the full story surfaced.

The next morning NBC Today Host Matt Lauer interviewed Mrs. Sherrod and asked her if this wasn’t an “oops” kind of moment for her former Agency, the White House and the NAACP.

She was very gracious and measured with her words. And before the day was over, the NAACP President, the White House and Secretary Vilsack publicly apologized and the Secretary offered her a new job with the USDA leading the agency on civil rights issues. She agreed to consider the offer.

The question is what happened? Who was responsible? Why did such an injustice occur?

Mrs. Sherrod came out the best. She never over-reacted. She was gracious in her response to media inquiries. She did not lash out at her critics or say anything inappropriate.

Vilsack was a little slow to fix a mess he helped make worse by jumping to a conclusion, but he did ultimately take responsibility and said, “She’s been put through hell and I could have done, and should have done, a better job.” And he added, “She was extraordinarily gracious.”

Of course it’s easy to blame the blogger who first posted the misleading video and equally easy to point a finger at FOX News and other rightwing leaning news shops who seem to always be looking for opportunities to pile-on, in what appears to be an ongoing attack on the “liberal” Democrats in Washington.

There are several lessons.
1. Make sure you have the facts before you insert foot in mouth and bite down hard!
2. Be careful and gracious when under attack – especially if you did nothing wrong.
3. When you over-react and speak out of turn, take responsibility and own-up as quickly as possible.
4. In spite of the preaching of one of our competitors who says apologies are over rated, apologize quickly and earnestly and then set about fixing whatever needs fixing.

Monday, July 19, 2010

What is the key to most disasters?

Seth Borenstein is an Associated Press reporter and could very easily be a spokesperson for the Institute for Crisis Management.

He researched and wrote a story that appeared in Sunday newspapers July 18. In our local newspaper –The Courier-Journal – the headline was “Key to most disasters? Human hubris”

The gist of his story was that most calamities follow ample warnings that are ignored, including the on-going BP crude oil disaster in the Gulf of Mexico. He recalled how the 1986 Space Shuttle Challenger explosion and the 2003 Shuttle Columbia crash were all preceded by multiple warnings that something was going wrong. And don't forget Massey Energy's Big Branch Coal Mine disaster.

Even BP’s 2005 Texas City, TX refinery explosion had multiple warnings that trouble was looming.

University of California-Berkley engineering professor Bob Bea says disasters do not happen because of what he calls “an evil empire,” instead, he says, “Its hubris, arrogance and indolence.”

If you read this blog semi-regularly, or check out our annual ICM Crisis Report, or even hear me speak, you know we maintain that two-thirds of all crises are preventable and I believe that many of the other one-third can also be avoided, if someone in the organization is paying attention, watching for signs of trouble and willing to do or say something about it.

Borenstein concluded in his article there is a “belief by those in charge that they are the experts, that they know what they’re doing is safe. Add to that the human weaknesses of avoidance, greed and sloppiness, say academics who study disasters.”

Rutgers University Professor Lee Clark, author of the book Worst Cases points out that safety costs money, or as we say, crisis prevention requires some time and costs some money, and as Clark observes, “you can’t get anybody to listen. We’re very reactive about disasters in the United States.”

It never ceases to amaze me how intelligent, successful and highly paid executives, managers and business owners, will ignore crisis management planning, training and prevention, but not hesitate to spend way too much money to fix a problem that could have been avoided for a lot less.

Motivational Speaker Scott McKain says, “It’s easier to Prepare and Prevent than to Repair and Repent.” My version is simply, “It is cheaper to prepare and prevent than to pay to repair and repent!”

It is so relatively easy and inexpensive to identify potential risks or crises in your organization, and prepare to prevent as many as possible and better manage those that cannot be avoided. The alternative is very expensive.

Monday, July 12, 2010

Do You Need a Social Media Policy?

Unless you’ve been vacationing in a cave or on a remote oil-free island for the past few months, you’ve heard about the Domino Pizza employees that posted a tasteless video on YouTube, and most recently four young TV news reporters and a photographer were fired at KARK TV for posting a profanity-laced video they thought was “funny.”

You also may have missed the various blog posts in recent weeks arguing for and against creation of a “social media” policy.

I used to have mixed feelings about a lot of “policy” stuff, but as I’ve gotten older and more experienced I have learned that fairly and carefully written policies can spare less experienced employees from potentially career ending blunders.

Unfortunately, those same policies will not likely save the careless and thoughtless employees, although a reasonable and documented policy saves management a lot of grief when they have to discipline or fire an offending worker.

I am old enough – I prefer to say experienced enough – to remember when I was one of the first TV news directors in the U.S. to computerize a newsroom. E-mail was not an issue, until later. I also remember when the workplace had policies about personal calls (on the company telephones), and when companies began to restrict access to the Internet and porn sites at work.

Now with Facebook, Twitter and a lot more, all organizations have a responsibility to their various constituents to do everything reasonably possible to protect their reputation and public persona.

Careless ramblings or contradictory statements on-line about an employer, a boss, business partner, customer, co-worker or even a competitor, that is not consistent with the organization’s public position, can be damaging.

A few companies have simple but excellent social media policies. Best Buy is one of those. The electronic retailer reminds its employees “whether you’re Twittering, talking with customers or chatting over the neighbor’s fence” good social media judgment applies.

And IBM urges its thousands of employees to be aware of their identification with IBM on-line. ”If you identify yourself as an IBMer, ensure your profile and related content is consistent with how you wish to present yourself with colleagues and clients.”

So what does this have to do with crisis management?

Two-thirds of all crises are what we at ICM call smoldering crises. They start out small, often internal, but not always, and they are the kind of issue that someone should spot and recognize as a potential future problem and fix it or tell someone who can fix it before it becomes a public embarrassment.

More and more “little” problems are getting started on-line and not recognized as the potential trouble they can become and then WHAM they hit a company or organization and all hell breaks loose.

Tuesday, July 6, 2010

You Knew It Was Gonna Happen

When soon to be retired Four-Star General Stanley McChrystal and some of his staff were quoted speaking "out of turn" in Rolling Stone Magazine and he was later forced to resign his position as top general in Afghanistan, you just knew there was going to be a crack-down on military officers talking to the media.

Unfortunately, in my opinion, it was the wrong thing to do.

General McChrystal's mistake -- and he made a big one -- was not in talking to the Rolling Stone reporter, it was his naivete and carelessness while talking to the reporter.

Defense Secretary Robert Gates would have been well advised to use McChrystal's experience as a "teaching moment" for all U.S. military officers already authorized, and hopefully trained, to deal with the media. The Army's embarrassment is also an excellent teaching-moment for corporate executives.

Don't avoid talking to the media. Look for every opportunity to tell your story, and do it according to "plan." Leave the jargon and "off-the-cuff" remarks back in the office. There is no place for such stuff in any conversation with a reporter -- on or off the record.

In the late-60's, I was assigned to a U.S. Air Force Wing Information Office and we worked for a one-star and then a two-star general. We looked for opportunities for the "boss" to talk to the media, but he was never left alone with a reporter. Just like later in my career I worked for a U.S. Senator and later another government official and there was always a staff person present when the "boss" met the press.

CEO's can learn from General McChrystal's experience and avoid the same mistakes.

And, stay sober when in the presence of the media and other publics.

Secretary Gates was not completely wrong in his attempt to "control" media encounters. It appears he just went a step too far in his directive.

Both in the military and the corporate world, persons at every level of an organization should be identified and trained as potential spokespersons. They should have limits on what subjects and details they are authorized to talk publicly about. They should always advise someone up the chain of command when they have a media encounter.

But, with few exceptions, including during a significant crisis, they should not have to go all the way to corporate headquarters or the Pentagon before they do an interview that falls within the parameters I just outlined above. If you can't trust a person to follow the guidelines, then they should NOT be authorized to speak to the media to begin with.

Thursday, July 1, 2010

Does The Board Have A Role In Crisis Planning

Gary Larkin, writing on the Governance Center Blog of The Conference Board website, raised a very important question. What is the role and responsibility of corporate board members when it comes to crisis planning, training and prevention?

I am sorry to admit that all too often I focus my writing on the C-Suite and only rarely comment about “the board.” The last time I had a client that had a board member concerned about crisis planning, it involved a CEO’s refusal to adopt a corporate travel policy. He loved to get his top three or four execs on a big silver bird, and “work” as they flew non-stop across the country, without any phone interruptions.

The board member was rightly worried. It was a publicly traded company and the sudden death of the entire top management team could be devastating. But, I digress.

Corporate executives AND boards should care about their companies’ crisis planning.

A crisis counselor in Australia recently asked me if I had any data indicating how many companies actually had any kind of a crisis plan. Alas, there is no verifiable answer to his question.

It’s hard to know, for sure, how many companies have useful and tested crisis plans. It’s like asking folks if they watch Public Television. Many say “yes.” But when the ratings come in, they don’t show up. Ask a corporate executive if she/he has a crisis plan and they’re likely to say “yes” because they don’t want to admit they don’t.

In Mr. Larkin’s post he referred to a survey of audit committee members and management of public companies conducted by KPMG’s Audit Committee Institute (The Audit Committee Journey: Adapting to Uncertainty, Focusing on Transparency) between January and March. 30% of the respondents said the greatest risk management challenge facing their companies is “understanding the velocity of risk events, and preparing for and responding to the impact. 20% said “understanding the link between strategy and risk,” 9 percent said “tracking and reporting on risks,” 13% said identification of risks,” and 14 % each said “mitigation of risks,” and “assessing risks.”

You may interpret those conclusions one way, but what I see is an attitude that crisis planning is still not high on many corporate agendas.

I recall a meeting a few years ago with a management team at an American pharmaceutical company. I was pitching them on crisis planning and how we could help them do that. A corporate executive stared at me and declared, “Mr. Smith, we don’t have crises. We manage our issues.” I, perhaps, was a little curt in my response. I told her I didn’t have a problem calling it issues instead of crises. Needless to say, we didn’t get hired at the time.

But, when management is not thinking about preventing crises or preparing to manage crises when they cannot be prevented, the Board could be.

Mr. Larkin poses a real challenge to corporate board members.

I would ask, are you content to have your board status on your resume and perhaps receive a nice check now and then, or do you care about the business you signed on to help lead? If your executive team is too busy or too distracted or too indifferent to care about crisis planning and training, are you sure you are associated with the right company? Or are you sure you have the best management?

Every company should have three crisis plans: (1) An operational crisis plan -- what do you do when someone pulls the fire alarm, or the tornado or hurricane is bearing down on your plant; (2) A crisis communication plan -- who says what, when and how do they deliver the message and to whom; and (3) A business recovery plan. In the best of all possible worlds, those three plans should be integrated into one comprehensive plan.

We can help you figure out what kind of plans you need, and help you create the communication plan to go with it.

Wednesday, June 23, 2010

McChrystal Had To Go

General Stanley McChrystal resigned his job because of indiscretions in the presence of a Rolling Stone magazine reporter.

What happened to Gen. McChrystal is the same thing that should happen to any corporate executive who is careless in speaking in front of a reporter, a share-holder, employee, or anyone else who has an interest in the company or organization.

When the first snippets of the Rolling Stone article began to circulate, I was astounded and could not imagine how senior staff to a Four Star General could be so reckless as to make statements criticizing the nation’s leaders and other high government officials that they had to work with.

I imagined the senior staff to the CEO of General Motors bad-mouthing the Chairman of their Board of Directors and federal officials and regulators, in front of a reporter from Forbes or the Wall Street Journal.

Then, when I read the complete article, I discovered they had been drinking heavily, as a group, and with the Rolling Stone reporter present when some of the most outrageous remarks were uttered. Intoxicated people are usually not in control of their tongues or actions and that raises two more questions.

Why did they (1) knowingly take the reporter with them and, in his words, (2) "get hammered" in his presence?

I worked in an Air Force Wing Information office in the late 60’s and we supported a one-star and a two-star general. I’m sure some of the staff had a drink, or more, on occasion but never with a reporter. Reporters get drunk, too, but rarely when they have access to a major news maker and not when a career-making story is on the line.

Losing control of their senses, one time, would have been bad enough. But, the reporter ended up spending several days, off and on, with Gen. McChrystal and various members of his leadership team. If they ever did think about the risk of talking to and in front of a reporter, they apparently got so used to him being around they really let their guard down.

I suppose they might never have cared what they said, and if that’s the case, they should be locked away somewhere!

All of this is NOT intended to discourage executives and leaders of business or other organizations from giving access to the media. Just know the rules. Reporters are always “on duty” and you should be too, when they are within earshot.

And, if you are involved in communications for corporate executives or the leadership of any organization, never assume they know how to conduct themselves with reporters, or understand how reporters work. Remind them that just because the camera has been turned off, or the reporter has put her notebook away, the interview is still going on as long as the reporter is close enough to see and hear them.

Tuesday, June 22, 2010

Annual ICM Crisis Report Released

The overall number of business crises were down significantly in 2009, and more in line with the years 2000 and 2004, but that did not mean it was a less tumultuous year.

The year began with the beheading of a Chinese student at Virginia Tech University, followed by the economic crisis, with all its subsequent stories - Madoff, Goldman Sachs, AIG, Lehman Brothers, big and small bank failures, upheaval in top management, outlandish multi-million dollar bonuses to heads of failing companies, and more. Industrial accidents and natural disasters sent many businesses into crises around the globe.

The one fact that never changes, except by tiny degrees, is the number of sudden VS smoldering crises -- nearly two-thirds of all publicly reported business and organizational crises in 2009 were the smoldering type -- the kind of disruption that had warning signs before it got out of hand and before it became a public event.

That reaffirms our consistent warning that roughly two-thirds of all organizational crises could be prevented and never become costly disruptions that all too often cripple an organization, if not kill it.

To download the full ICM Annual Crisis Report copy and paste this link in your browser:

Friday, June 18, 2010

How About A New BP Spokesperson?

About 60 days, too late, BP’s CEO Tony Hayward, is being replaced as chief oil spill spokesperson. Managing Director Bob Dudley has been tapped to assume that role.

At the Institute for Crisis Management, we believe strongly, there is a time and a place for the top executive of a company in crisis, to face the cameras and the public and speak on behalf of his or her organization. It should happen relatively early, and be carefully controlled, and be more of an opportunity for the top person to make a statement, not to be hammered with questions that he/she most likely does not have answers to.

Then that executive should go “run” the operation, and leave the day-to-day, on-going spokesperson role to someone high up in the management ranks, but with more operational experience and public credibility.

The major airlines perfected this approach years ago, when they developed their crisis communication plans for airplane crashes. A day-to-day spokesperson, with plenty of training and experience, is immediately assigned to be the “public face and voice” of the organization.

Meanwhile, the CEO is put on the first airplane the company can commander and flown to the airport nearest the crash site, where he briefly appears before a mob of reporters. He expresses his sympathy for the victims and their families, pledges his personal and company commitment to work with all investigating agencies to determine what went wrong and then re-introduces the “on-going” spokesperson to answer any questions the company may have answers for, and excuses himself to go “manage” the crisis.

This is a tried and true approach and there are very few exceptions, in my experience. There are some things only the CEO can do, and if he/she is busy fending off reporters, he/she cannot do the leadership/decision making things.

But just as significantly, IF the CEO misspeaks, there is no one left to step in and fix it. That’s what BP has faced, over and over again for nearly 60-days.

There is also a cultural gap between the leadership of BP and the American audience. We experience this frequently with our clients that are European or Asian. They don’t think the same way Americans do and they don’t share the American belief that management should be sharing information with their workers , customers and partners.

And they don’t speak the same. Their colloquialisms are frequently misinterpreted by Americans, just as an American from the deep South is sometimes misunderstood by a Yankee or vice versa.

Not only has Tony Hayward been criticized for his British way of expressing himself, The Swedish Chairman, Carl-Henric Svanberg, set off a firestorm when he used the expression “small people” at the White House, when he probably meant “everyday folks.”

Now, the new spokesman for BP is former president and CEO of Russia’s third largest oil and gas company. I can only imagine how he is going to be greeted by Americans.

Wednesday, June 16, 2010

Which Audience Is Most Important: Internal or External?

In any kind of business or organizational crisis, internal communication is often more important than external, or at least as important.

Whether you’re BP, Toyota, Apple or a small mom-and-pop business, you will not only lose the battle, but the war, if you don’t keep your employees, partners, and their families informed and reassured.

Under normal operating conditions, effective internal communication leads to better and more productive and supportive employees. In a crisis, it is even more important to keep employee spirits up and maintain employee confidence and support. Otherwise, management mistrust takes over and when employees do not trust their bosses, productivity suffers, and productivity impacts the bottom line.

I can give you two examples – at the extreme – of size and potential damage.

An international manufacturing company that does business in Europe, North America and elsewhere, was faced with an unfounded attack on one of its consumer products. The public media was told the allegation was not true, but the story persisted and critics took to the Internet.

With thousands of employees around the world, the company wisely met the issue head-on in its plants, distribution centers and offices and explained the facts and the misperception that was being spread. The employees believed their management and conveyed that to their own families, and in a couple of weeks, the issue disappeared.

At the other end of the spectrum, a client with fewer than 200 employees and contracts with several federal government agencies. An employee was fired for cause, and set out to get even by filing federal whistle blower complaints. After many of the complaints were dismissed, the ex-employee finally found a government lawyer with his own agenda.

The company faced a multi-million dollar settlement and we were called in to help management get ready for the media coverage. Our advice was the media would probably not pay much attention, but employees would panic when they heard about the settlement and fear for their jobs.

The owner rejected our initial recommendation to concentrate on reassuring employees that the company was sound and the settlement, although over the top, would not slow the company’s growth and success. The owner said, that was none of his employee’s business!

We prevailed, however, and when the settlement was made public, we had employee meetings scheduled and appropriate explanations ready and talking points for a private meeting with the company’s banks and lenders. When each meeting was done, the employees and bankers said, “okay” and work resumed, business continued to grow and the media paid almost no attention at all. It was a one-day business page story in a couple of local newspapers

Internal communications is all about creating and maintaining a trusting relationship. It is as much about what you say, as how you say it and when. If you wait for your employees to hear about your bad news from someone outside the organization, it will come back to haunt you.

If you don’t communicate quickly and effectively in a crisis, employees will lose their trust in you and the entire organization will suffer.

This is just as important in today’s environment of “downsizing” and “right-sizing” and all the other euphemisms for lay-offs. When you lose a customer, it impacts your bottom line, but you can go after another customer.

When you lose an employee because of a lay-off, you not only lose a person that will not be replaced, but you will send shock-waves through the remaining employees, who will begin to fear they will be next and/or resent the fact they will have to work harder to make up for the person or persons who have been thrown out like dirty dish water.

Internal communication before, during and after a lay-off will determine the future of the organization and whether it will prosper again, or not.

Thursday, June 3, 2010

Tony Hayward: “Did I Say That?”

The CEO of British Petroleum is not the first, and won’t be the last chief executive to say things he later regretted. We can only hope they regret some of the things they said.

Thanks to NEWSWEEK Magazine, we have a collection of documented “gaffes” – Newsweek’s description – made by BP’s Tony Hayward, beginning almost immediately after the April 20 explosion that killed 11 people and sent a steady stream of crude oil into the Gulf of Mexico.

One of the reasons we normally recommend the top executive NOT be an on-going spokesman in a crisis is if he/she misspeaks there is no one else who can step in and fix it. Hayward keeps misspeaking and there isn’t anyone in the organization that can fix it.

The New York Times reported Hayward told associates “What the hell did we do to deserve this?” And Newsweek added, “A possible answer might be the company’s 760 safety violations over the last three years” compared to one for ExxonMobile.

Two weeks later Hayward tried to put the disaster in perspective, telling a British reporter the Gulf of Mexico is “a very big ocean” and the oil and dispersant spreading throughout the region “is tiny in relation to the total water volume”

Then he was quoted by Sky News as saying the “environmental impact of this disaster is likely to be very, very modest.” Either his staff is incompetent, lying to him, or he is not paying attention to them.

The biggest “gaffe,” at least to many of the Gulf area victims, including the families of the eleven that died, came May 30 on the Today Show when he declared, “. . . there’s no one who wants this over more than I do. I would like my life back.”

You can imagine how the victim families felt about that. He later apologized.

BP has hired help – one of former Vice President Dick Cheney’s spokespersons, Anne Womack-Kolton, has been brought in to advise Hayward!

Saturday, May 29, 2010

Suicides at Apple, Dell Suppliers in China

Apple, Dell and H-P are facing a potential public relations nightmare following at least 10 suicide deaths and another 20 suicide attempts by employees of Foxconn Technology Group.

The giant Chinese manufacturer of Apple I-Pads and Dell’s new Streak tablet employs an estimated 400,000 workers, or more, and most live in dormitories on company property. That’s roughly the population of Miami, Florida.

And, according to the World Health Organization, China’s national suicide rate is 13 to 15 per 100,000 population, so that is not an unusual rate, except the number of deaths has been in such a short period of time and in one work-place.

While media attention and bloggers have been talking about the rising number of suicides at the Foxconn plants, customers like Apple and Dell and HP are facing growing criticism for their support of “sweat shops” in pursuit of higher profits.

The American companies have been telling anyone who will listen that they have standards for their suppliers to follow and Apple and Dell say they are conducting their own investigations.

After several days of continuing coverage, Apple finally issued a statement May 26, saying the company was “saddened and upset” by the suicides.

Because Foxxcon is so big and companies like Dell and Apple have put so many of their apples in that one basket, no pun intended, the American companies have few choices except to put the best face on the situation and try their best to influence their suppliers to treat their employees humanely.

Meanwhile, Foxxcon has begun installing safety nets around their employee dormitories, where most of the suicides resulted from workers jumping from the roofs of seven story buildings.

Tuesday, May 25, 2010

BP's Twitter Imposter

Say what you will about British Petroleum (BP) but they seem to have a sense of humor.

Within the past week, someone has hijacked the company's brand on Twitter, @bpglobalpr and in a matter of days has more followers than BP's own Twitter account @BP America.

Many companies, hit by a fake Twitterer, complain and insist the look-alike account be removed. BP spokesman Toby Odone told Ad Age, "People are frustrated at what's happening, as are we, and that's just their way of expressing it."

The site is somewhere between a parody and down-right comedy, but the frightening part is some people "get it" and are having fun with it, and some take it seriously and are responding accordingly.

The lesson for crisis communicators -- sometimes you do less harm by not making a big deal out of a critic's efforts.

An example of the fun the writer is having at BP's expense: "Proud to announce that BP will be sponsoring the New Orleans Blues Festival this summer w/ special tribute to Muddy Waters. #bpcares"

And another: "I'm sorry, are people mad at us for drilling in the ocean?!? Maybe God shouldn't have put oil there in the first place. DUH. #bpcares"

Dan Hicks, ICM Senior Consultant and author of continues to praise BP's communication strategy and its execution. I have been impressed with their websites and how often they have made senior executives available to the media.

I still believe they could improve their execution of message development and delivery, but as Dan said in his most recent blog post, a company has to do the "right thing" and then they can talk about it. Stopping the spill and expediting the clean-up is job one, right now.

Monday, May 17, 2010

What Will Toyota Do With Its Polling Results?

Just because someone says it, writes it or reports it, doesn’t mean it is true and just because someone denies it, doesn’t mean it’s not true!

I wanted to clear that up.

This week The Washington Post reported that Toyota executives considered a public relations strategy to attack the credibility of at least two public critics – A Massachusetts safety consultant and a technology professor at Southern Illinois University Carbondale.

Part of the evidence the Post used for its story was a series of public polls commissioned by Toyota, and including questions that challenged the integrity and motivation of the two men.

Toyota says it never used the poll information in any advertisements and Congress wants to know if it was used in any other way.

In the real world, corporations and politicians spend a lot of money on market research and polling. Politicians do it for the same reason companies do; to find out what the public knows, cares and thinks about a product or a candidate and the competition, whether it’s another car company or an opposing candidate.

It’s how companies/politicians put that information to work that, sometimes, raises eyebrows.

There’s another group that uses similar polling – plaintiff’s attorneys. Toyota already faces more than 327 lawsuits and those lawyers use market research to see what arguments will win them money and where the most likely “customers” are and how to sign them up for their class action lawsuits.

You know how you feel about some of the so-called dirty politics that grow out of the polling information that candidates use. We should feel the same way if a company, like Toyota, were to use that kind of information for any other reason than a fair defense of its own position and to point out legitimate mistakes or misinformation from its critics.

From a crisis communication perspective, we frequently encourage our clients to avoid criticizing the “other side” and concentrate on emphasizing their own facts and truth.

Tuesday, May 4, 2010

Have You Tweeted BP Today?

Ain’t technology grand?

Where would we be, today, without Facebook, Twitter, millions of blogs (including this one) and YouTube?

Where would British Petroleum and Transocean be without all these new fangled “social media?”

They wouldn’t be any better off, but they would not have to hear all the nasty things people around the world are saying about them – at least not until the hundreds of lawsuits begin winding their way through the American legal system.

One recent Tweet said, “Thanks for fighting standards and regulations that would have prevented this leak.” Another Tweeter declared “I will walk before I ever buy a gallon of your gasoline.”

And some of our crisis communication consulting peers are asking, what, if anything has BP learned from Toyota.

Well, BP has launched a new website: called “Deepwater Horizon Response,” with scores of pages of detailed information, hotline phone numbers, official company statements and maps and what BP calls “contingency plans.”

And company executives have bravely been facing the cameras, but they have not begun to take control of the story or the company’s future. Someone needs to not only appear to be in charge, but actually be in charge and make strong, clear statements about what BP and Transocean is doing, going to do and how they’re going to do it, to stop the flow of oil and clean up the Gulf.

It appears the leadership of BP was naive or blind to the risk they faced. It never ceases to amaze me how intelligent and successful business men and women can convince themselves that “nothing will go wrong while I’m in charge!”

When they were considering the mile-deep drilling in the Gulf of Mexico, they may have weighed the risks and consequences, but, even if they did, they should have gone to the next level of their risk assessment and asked what if something worse happens? And then develop an operational plan, a communication plan and a recovery plan for the “even worse” situation.

BP will survive just like Exxon did, and probably continue to make billions of dollars in profits, while we grouse about the exploitive oil companies and keep on spending obscene amounts of money for their products.

Friday, April 30, 2010

How Is BP Doing?

Even though some critics are panning BP officials for seemingly down-playing the severity of the Gulf oil leak in the early hours after the April 20 explosion and fire, I think they got off to a slow but appropriate start.

I may regret writing this, since everything can change in a single news cycle, but on Friday, April 30, 2010, they seem to be responding relatively well.

With 20-years experience in crisis communication, I am inclined to give leadership of a company in crisis the benefit of the doubt in the first few hours after a major disaster. Facts are scarce and with the loss of eleven lives and scores more workers waiting to be rescued, answers are never as readily available as the media and public demand.

One of the first important communication challenges is to respond quickly, never speculate, and make it as clear as possible you don’t have instant answers, no matter how much you wish you did. It was some hours after the initial explosion before company CEO Tony Hayward expressed his and his company’s “concern” for the “rig personnel and their families.” That probably couldn’t have happened much sooner.

Once company leadership learned the leak was five times what they had earlier reported, they said so, and then CEO Hayward said he would welcome help from anyone.

The Associated Press reported that environmentalists are giving BP credit for responding much better than Exxon did in 1989

Use of the BP website and the Joint Information Center website has been relatively good. Responding to local officials in communities in the path of the ever-widening spill, BP began opening offices in each of those communities, manned by company employees, to provide more timely information and support to the locals. That was a good decision.

The New York Times quoted Hayward saying, “Reputationally, and in every other way, we will be judged by the quality, intensity, speed and efficacy of our response.”

There are basics that work in most crises. Respond as quickly as possible. Don’t speculate. Be as honest as possible. Start by expressing sympathy for the dead and injured and their families.

Have a plan to respond to the operational issues, another plan to deal with internal and external communications, and be ready with a plan to get back to normal operations as soon as possible.

At the Institute for Crisis Management we maintain that you should anticipate what possibly can go wrong and develop a plan to manage it – then multiply how bad you THINK it might be, and plan for the even more serious situation. It appears BP had plans and processes in place, but they were limited to a lesser disaster than they are really facing.

Don’t point fingers and lay blame. Take responsibility. Do what is right. Anticipate, each day, the questions your employees, your customers, your partners, environmentalists, regulators and the public will have, and prepare to answer the questions you can answer and explain why not, if you can’t. “We don’t know” is a reasonable answer, “We don’t know, yet, but when we do we’ll share that with you, if we can,” is a better answer.

Wednesday, April 28, 2010

Did Goldman Sachs Win or Lose?

It is a safe bet that the cards are stacked against any company summoned to appear before a U.S. Congressional Committee.

Each member of the Committee has a half-dozen, or more, staffers researching and writing opening and closing statements intended to stir up constituents, and preparing questions that make their Senate boss look tough on whatever the issue is before the Committee.

All the company executives can do, with their legions of support staff, including lawyers and PR people, is anticipate the questions and figure out which ones they can properly answer and how to avoid the rest.

If you were expecting understandable explanations from Goldman executives in Tuesday's hearings, you are either naive or an eternal optimist. If you were expecting civil discourse from grandstanding Senators, ditto.

One of the bright moments in the hearing followed numerous charges that Goldman was running a casino operation stacked against their clients. Senator John Ensign, a Republican from Nevada, spoke up to defend his home state and its primary industry -- gambling. He said people who go to Las Vegas know the odds are against them, but, "on Wall Street, they manipulate the odds while you're playing the game."

Some of the Senators turned viewers and constituents off when they repeatedly quoted from a vulgar and profanity laced e-mail.

Goldman executives didn't score many if any favorable points, but they didn't do or say anything new or reveal a "smoking gun" either.

I agree with market analyst Edward Yardeni, there was nothing to create a more damaging perception than already existed, and the Senate VS Goldman PR battle was fought to a draw.

It is hard to feel sorry for many of the so-called "clients" that lost money in deals with Goldman. Most of the clients that invested millions of dollars in risky deals with Goldman were gambling they would get lucky and Goldman would be unlucky.

Wednesday, April 21, 2010

The Pope Apologized, Sort Of

Finally, the Pope and other representatives of the Catholic Church have apologized, sort of.

Washington Post and syndicated columnist E. J. Dionne and senior fellow at the Brookings Institute, himself a devout Catholic, said today on National Public Radio his own pastor recently talked about the scandal, individual culpability and institutional church culpability.

In his Easter sermon, Dionne conceded, his priest became defensive though, when he added, enemies of the church were stirring this up.

In the past year, or so, some of our competitors have been complaining that organizations in crisis are wasting their time in apologizing.

I would suggest an apology is not the be-all, end-all solution to an organizational crisis, but “taking responsibility” when something goes wrong, explaining what you’re going to do to fix it, and then fixing it, is almost always the most sure-fire way to recovery.

An apology is only as good as the sincerity of the person speaking and the context in which it is delivered.

In recent days, the Pope is reported to have said, “Now, under attack from the world which talks to us of our sins, we can see that being able to do penance is a grace and we see how necessary it is to do penance and thus recognize what is wrong in our lives.”

Asked about the Pope’s “apology,” Dionne, the newspaper writer, said, “I suppose if I had been an editor, I would have asked him, 'can you drop the first half?' Because, I think . . . attacking the world first for bringing this to the church’s attention undercuts the contrition in the second half.”

I agree. How many times have you heard a CEO or a politician stand in front of the cameras and say, “…if I offended you, I apologize.” What I hear is, “I’m not sorry for what I or my company did when we knowingly sold you contaminated (fill in the blank), but I am sorry if it offended you!”

Whether it’s the Catholic Church or a corporate client, I’m not so concerned about the “critics,” but I urge them to hear and respond appropriately to their members, employees and customers.

Monday, April 12, 2010

Pandemic Good News - Bad News

A year ago this month, the H1N1 Swine Flu pandemic swept across Mexico the U.S. and eventually most of the rest of the globe. So far 17,770 people in 213 countries have died and millions sickened. The average age of those who died is 37, compared to an average age of 75 for those who die annually as a result of the seasonal flu.

That’s the bad news!

The good news is ONLY 17,770 people have died so far, compared to 50-million worldwide during the 1918 pandemic, including half-a-million Americans that died in the last four months of 1918 and 70,000 dead as a result of the Asian Flu pandemic in 1957 and 34,000 Americans who died from the Hong Kong Flu in 1968.

Now a small group of scientists and political critics are attacking the World Health Organization (WHO) charging the agency with creating panic and causing governments to stockpile vaccines which were not needed.

The WHO, Monday, said it did not handle the pandemic properly and failed to communicate “uncertainties” about the H1N1 virus and how lethal it might, or might not be.

Keiji Fukuda, the WHO's top influenza expert said people “around the world have very high expectations for immediate information. In many ways it is unforgiving out there.”

He’s partly correct. However, it’s not the “people” that want instant answers to every question, it is the media. It doesn’t matter if it’s a pandemic, a mine explosion, a plane crash or any other sudden tragedy, reporters insist on knowing what happened, why and who is responsible, NOW! Most of those answers take time to determine.

And a pandemic is so rare, only one every 30 or 40 years, and they are not predictable and there are so many factors that influence how mild or severe they may be.

Five years ago, here at the Institute for Crisis Management, we began urging our clients and potential clients to plan for a pandemic. I spoke to all kinds of business and professional organizations from Nova Scotia to Sao Paulo, Brazil and from sea to shining sea, stressing the importance of developing a pandemic business crisis plan.

But then, we always encourage organizations of all kinds, to create and maintain crisis operations, communications and business recovery plans.

We still do, and the organizations that have plans are much less likely to experience business ending events, because part of the preparation process is looking for ways to prevent crises and then how to minimize the damage if you cannot avert the disruption.

Those businesses and other organizations that developed pandemic plans are now better prepared to deal with a number of other crisis types, including nuclear and bio-hazard attacks or accidents upwind from their sites or terrorist attacks in or near their locations.

The world has experienced pandemics since at least 1500 and the next one could strike at any time or not for another 30 years. I still believe it’s better to be prepared and nothing happen, than to not be prepared and experience a business-ending event.

Thursday, April 8, 2010

No Good Deed Goes Unpunished

In January, Toyota’s senior U.S. public relations executive tried to warn the company’s leadership to go public and take responsibility for the faulty accelerators on some of its cars.

Five days after Irv Miller hit send on his memo, about the time it would take to mount a recall strategy, Toyota announced the recall of 2.3 million vehicles in the U.S. Now, his memo may be the straw that broke the company’s legal back.

Earlier this week, days before this memo was leaked to the Detroit Free Press newspaper, Federal safety officials fined Toyota $16.4-million, making it the largest U.S. vehicle defect fine so far.

By the way Miller has since “retired” from Toyota.

The memo will most likely be used as a hammer against the company by plaintiff’s attorneys who have filed several class action lawsuits against Toyota, and will be more evidence for U.S. safety administrators to use against Toyota in additional enforcement actions. A spokesman for the National Highway Traffic Safety Administration (NHTSA) says Toyota was aware of the sticky gas pedals last September and alerted dealers in Europe and Canada four months before telling U. S. safety officials and customers.

Miller wrote in his memo, “We are not protecting our customers by keeping this quiet. The time to hide on this one is over.” PR folks often function as the conscious of an organization and it takes wisdom, experience and the respect of peers and management to be effective at it. It’s a shame the company did not get that message months earlier and act on it.


There’s another lesson in Irv Miller’s memo. He should have made his appeal in person or on the phone or in a video conference, but NOT in a written memo – on paper or e-mail. All written and digital documents are discoverable in subsequent legal actions and Miller’s memo, no matter how well intentioned, may cost the company a great deal.

Monday, April 5, 2010

It's About Time, Tiger!

Where was today's Tiger Woods last February?

Tiger Woods met the press -- albeit the golfing press -- minus the tabloid reporters -- and acquitted himself well.

Mind you, he didn't answer all the questions that were posed, but the questions he did answer were more "natural" and heart-felt than the formal, stilted statements he made earlier and in the two 5-minute stand-up interviews of a few weeks ago.

He appeared more relaxed and less anxious and the questions he didn't want to answer he talked around or just ignored. But he didn't seem rude and only slight evasive.

I have said from the outset he did not need to elaborate on the details of his misdeeds. And, if he had been as forthcoming months ago, as he was today, some of the heat might already have begun to dissipate.

Golf fans seem ready to accept him back. Critics will still be critics. The tabloids will continue to dredge for dirt.

The only things still uncertain: will he save his marriage, will sponsors come back and can he win another tournament.

You know which of those unanswered questions should be most important.

Tuesday, March 30, 2010

Crisis in Rome

Joe Ferullo’s blog on the National Catholic Reporter March 29 was titled “Crisis Mis-Management."

Joe, you wrote about the “grey suited men and women. . .” who have been practicing the “precision art called crisis management” since at least the Watergate Era. I would like to correct one thing in that statement – some of us wear the business uniform of Blue Blazer, TV-blue shirt, red tie and grey slacks! I just didn’t want to mislead anyone that we all wear grey suits.

Whether you are Catholic or not, I would encourage you to read what Joe had to say at:

Joe points out there are two “simple” Golden Rules: Get the bad stuff out there and get it out there fast.

It’s not quite that simple, but it’s not rocket science, either.

When something goes horribly wrong, or even a little wrong, the story will spread, potentially world-wide, quickly. The only thing that can slow it down is if there is something a little worse going on at the same time. Your horrible news may get pushed aside by someone else’s more horrible, or at least more bizarre news.

Either way, you have a choice – let someone else tell your story their way – or tell it your way, first. That part of Joe’s message is spot-on.

But the next step, and timeliness is equally important, is to take responsibility for what went wrong. So far, the Catholic Church and its worldwide leader have not done that, yet. Joe writes that “sounds counter-intuitive.” He compares what ought to be done to the natural instinct to “circle the wagons” and wait for the trouble to subside. There is a fallacy there, however. It is rare for a negative news event to blow over without at least causing some, often times, significant damage.

Now I’m getting a little jaded in my older age. After more than 45 years in the news business and helping clients as a so-called crisis communication expert, I’ve come to realize that most people don’t get as worked up about someone else’s misdeeds as the media and the pundits. In fact, I’m not sure that most devout Catholics are all that alarmed about allegations their spiritual leader, Pope Benedict XVI, failed to act years ago to stop sexual abuse by a local Priest.

It is a serious issue. No one should be allowed to hurt children, or anyone else for that matter.

But, it is not a new problem, and in several Catholic diocese across the United States, the Church has paid millions of dollars in settlements in civil lawsuits in recent years. I fear that if a Catholic church member does not know someone who was abused, this issue will be only a short-lived concern. That is not a slur on Catholics, it is today’s human nature, no matter what religious beliefs people have or do not have.

However, it still behooves the Roman Catholic leadership to take some basic steps to fix the perception of Priest child abuse as well as stop the problem itself, and explain what it is doing to make sure it never happens again, without swift and decisive action.

Friday, March 26, 2010

Has Tiger Said Enough?

No one should be surprised that the media, almost all forms of it, are still complaining that Tiger Woods has not answered all their questions -- particularly what happened the night he drove his SUV into a fire hydrant and tree in front of his Florida home.

I must confess, I too am curious. Maybe its because I spent more than 30 years in the news business.

However, in the job I have been doing for nearly 20-years, I have come to believe there is a limit, no matter what the public or its alleged representatives in the media say.

When an organization or an individual gets into trouble, there are some basic principles that apply and have not changed much since our founder Bob Irvine wrote the first book on crisis communications in 1988 -- WHEN YOU ARE THE HEADLINE.

The individual or the leader of the organization must step up and take responsibility for what happened or what went wrong . . . the sooner the better.

Then he or she must express their regret, their apology, their sympathy, whichever is appropriate and follow that with a statement of what they are going to do to fix the problem.

If it is a company that made or distributed a defective or contaminated product, they must admit it happened -- it's okay to explain how it happened -- and then it is essential the spokesperson explain what has or is being done to make sure it never happens again.

If its a case of individual misconduct -- ethical or moral -- the person responsible needs to own up, apologize and in as few words as possible explain what he or she is going to do to make sure it never happens again.

THEN, they have to live up to that public commitment.

It is often more important for public people, public organizations and companies to "do the right thing" than to keep talking about.