Crisis Consultant

Did Carnival Cruise Lines Do Anything Right?

2012-01-24T14:52:00.002-05:00

It's hard to say what, if anything, Carnival Cruise Lines did right in the hours and days after the Costa Concordia ran aground and rolled on its side off the coast of Italy Jan. 13th, but the Costa Cruise subsidiary that operated the cruise ship, did a number of things correctly.

The investigations are getting underway, and the ship's captain has been held in an Italian jail since the disaster.

Beginning Saturday, Jan. 14, Costa Cruise's website carried a series of statements, including the
latest one Jan. 24 and the statements were for the most part appropriate: http://www.costacruise.com/B2C/USA/Info/concordia_statement.htm although there were a lot more questions that needed answers.

And on Jan. 16, an unidentified spokesperson, (appears to be the President) for Costa Cruise Lines appeared in a YouTube video expressing his sympathy and condolences to the victims and their families and defended the crew and its response, while implying the company would work with the investigators to determine what happened. http://www.youtube.com/watch?v=KNqAq2bHtFc&list=PLCFEC80D99741E604&feature=plcp&context=C3ac7430FDOEgsToPDskK516ywc1gCQ4ETsdiw88e

Most of the time, that should be the only public statement from the President or CEO. A previously identified company spokesman, who has had media training, should then be designated as the on-going spokesperson for the company. This should be a senior executive or manager, and he or she should have gone to the scene to represent the company.

And that spokesperson should have been updating passengers, employees and the media regularly on the status of the survivors, what is being done to stabilize the ship and prevent a catastrophic environmental spill of half-a-million gallons of ship's fuel.

Answers to those questions have been few and far between.

The ship's captain claims the company ordered him to run close to the shore for publicity purposes, and so far, I've not seen any denial from the company. And it would be appropriate for the company to at least say it is considering the captain's future with the cruise line.

A week later, there is no sign of any reference to the ship wreck on the Carnival Cruise Line website. Carnival is the parent company of Costa Cruises.

Spying On or Monitoring the Opposition

2012-01-18T14:18:00.000-05:00

Australian government agencies have been attacked recently because they admitted they paid a company to monitor the on-line activities and public postings of environmental activists, and the federal police routinely monitor anti-coal mining groups and others through their websites, blogs, Facebook and Twitter posts.

Our counter-part down-under, Tony Jaques, in his most recent "Managing Outcomes" article raises some questions that perplex me.

We strongly recommend to almost all our clients that they should be monitoring what anybody and everybody says about them in all media....print, broadcast, and on-line.

Whether you are a small mom & pop business, a not-for-profit, a Fortune 100 Company or somewhere in between, it is foolish and dangerous not to be aware of what your supporters and critics are saying about you. It is no less unreasonable for government agencies to do the same, as long as it is legal and ethical.

What could be more legal and ethical than to read what is being said about your organization in any and all public forums?

Now, to the perplexing part.

Tony points out that an Australian "Greens" activist Bob Brown has charged the government with "spying on conservation groups"and says they are trying to "criminalize political protest."

I think Mr. Brown should look at the world around him and recognize that when he is writing or talking about the government or any other organization, in a public forum, he not only should expect them to pay attention, he should be offended if they are not paying attention to what he has to say.

Tony also raised a question about the potential damage to a company's reputation if its monitoring of opposing viewpoints is misunderstood or misrepresented.

You can read Tony's column at: http://managingoutcomes.wordpress.com/2012/01/16/spying-allegations-tarnish-legitimate-issue-management/

I would argue that many organizations are more likely to be criticized and raked over the coals if they "are not" listening or paying attention to what others are saying about them.

Zappos Customers Got Zapped

2012-01-16T16:24:00.000-05:00

The e-mail to Zappos shoe, clothing and bag customers began: "First, the bad news..."

The bad news was that a hacker or hackers stole 24-million customers' personal information, including the last four digits of consumer credit card numbers. As big a "hit" as it was, it still pales in comparison to the 77-million customers' data stolen from Sony Play Station Network last year.

The second paragraph of the Zappos customer e-mail began: "The better news...." "the database that stores your critical credit card and other payment data was NOT affected or accessed."

The company responded relatively fast with its blast e-mail and suggestion that every customer create a new password...and even created a link from their HOME page to "create a new password" page. There, in tiny print it also says: "You'll pay nothing if unauthorized charges are made to your credit card as a result of shopping at Zappos.com."

While the company has been moving in the right direction, it has done one thing that is relatively unheard of in today's business crisis world. Zappos TURNED OFF their customer call center phones and are only taking questions by e-mail.

CEO Tony Hsieh reportedly informed employees by note, "Due to the volume of inquiries we are expecting, we realized we could serve the most customers by answering their questions by e-mail."

In the customer e-mail, Hsieh concluded, "We sincerely apologize for any inconvenience this may cause." And then suggests customers e-mail passwordchange@zappos.com with any comments or questions!

EEOC Takes A Page Out of Plaintiff's Attorney Handbook

2012-01-13T17:28:00.000-05:00

The Equal Employment Opportunity Commission is beginning to act like scores of so-called "plaintiffs' attorneys" and advertising for "plaintiffs" or people who think they may have been discriminated against when they applied for a job.

A quick Google search will find lots of examples of law firms advertising for clients to sue someone...such as "The Food Poisoning Lawsuit Center."

Now EEOC is soliciting similar "victims" both on its website and in local newspaper adds.

They have recently launched two major "employment discrimination" cases and one of them is accusing Bass Pro Shops -- in the words on their website -- "If you applied for a job at any Bass Pro location and think you may not have been hired due to your race or national origin; or if you have any information about the EEOC's lawsuit, please contact the EEOC at this special phone number . . ."

The EEOC's more aggressive approach will likely do two things -- bring real and opportunistic victims out of the woodwork to bolster the feds case against companies, AND encourage all those "plaintiffs' attorneys" to step up their own marketing and expand the causes they promote and capitalize on.

Our first advice is not to discriminate, but even if you have not discriminated against anyone, someone may decide to try to extort you and the EEOC's new approach could add to your grief and challenge of defending your company.

There Are No New Crises -- Just New Lessons From Old Events

2011-12-12T15:42:00.000-05:00

I don't want to run this message into the ground -- but, oh why not?

There are no new crisis. You do not have to reinvent the wheel. Just pay attention to what worked and what didn't and copy the part that worked.

Toyota did it all pretty much the wrong way.

Chevy's Electric Volt with its suddenly bursting into flames seems to have done it right.

Toyota didn't talk, and when it did it made excuses.

Chevy has talked, but even more significantly Chevrolet offered free loaner GM vehicle until the issue of the unexplained Volts burning battery is resolved.

Chevy's experts not only talked but explained the fires were not spontaneious. They came up to three weeks after the accident that caused the damaged vehicles to be parked and taken out of service.

When you're business is facing a crisis, look at what worked and what did NOT work for your competitors, and then use the stuff that works and ignore the stuff that did not.

Recovery will come much quicker, almost every time.

You Think It Could Not Happen Here? Think Again`

2011-12-09T14:24:00.001-05:00

The death toll is at 89, mostly patients, at the Kolkata, India hospital where a blaze broke out in a storage area in the basement and spread, while some hospital administrators reportedly fled the scene.

Satyabrata Upadhyay, senior vice president of the AMRI hospital company, said the loss of life was "extremely unfortunate and painful." Upadhyay also said the compensation that would be given to families of those killed would be 200,000 rupees (about $4,000 US$).

Where to begin.

Can you imagine hospital administrators fleeing in a vain attempt to avoid responsibility in any other part of the world. I can.

Can you imagine a health care provider, in many other parts of the world, taking pride in offering $4,000 in compensation for the death of your mother, father, child or spouse. Settlements are a releative thing, and only in America would the lawyers already be salavating over the millions of dollars they would expect to bank in such a case.

Just coincidentally, I was in a very good hospital near Louisville, KY lastThursday and Friday for spine surgery. I was cared for by some of the best nurses and technicians you could ever hope to have. I also had a surgeon who has a reputation for being good as a surgeon, but a little long on ego and short on bedside manners.

Now is the perfect time, if you are a hospital administrator, manager or nursing supervisor to review every aspect of your facilities operations, storage, evacuation plan and training and emergency access to your building's access points and service entrances.

Do NOT put it off a single day. If you do, put this phone number in your wallet or purse because you'll need us before you know it: 1-502-587 0327.

What Was Jerry's Lawyer Thinking?

2011-12-04T17:34:00.001-05:00

Former Penn State Assistant Coach Jerry Sandusky is consistent, at least. Allegations of his initial sexual assaults on young boys set off two waves of strong reaction. First, his former boss Joe Paterno and other PS administrators were shocked that he was being accused of such things.

Then he told NBC News he didn't do anything wrong. The outrage was greater when he finally defended himself. Then it occurred to some so-called leaders that blaming potentially sexually abused children for their mistreatment was not gonna work.

Then Sandusky agreed to do a four-hour interview with the New York Times, reiterating that, in his mind, he didn't do anything wrong.

And the uproar was even greater.

At least once a day, someone calls and asks what advice would ICM give Penn State, or Jerry Sandusky.

The answer has been consistent.

Never say "no comment" or any variation on that term or concept.

However, there is one response that is appropriate and consistent with the "no comment" advice.

"This is an issue that is likely going to be resolved in the court of law, and responses to those kinds of questions will best be answered in the court of law and not in the court of public opinion."

That IS an answer. It is NOT a "no comment" and no lawyer or communication consultant could harm their client with that advice.

Crisis Communication Training -- Register Now

2011-11-23T10:31:00.001-05:00

The new year is fast approaching and participants are beginning to register for the Institute for Crisis Management 2012 Crisis Communication Certification Courses in Louisville, KY.

You should register as soon as you can for the intensive and thorough two-day crisis communication training and the optional third day of media/spokesperson training.

There are still openings in all four sessions of the 2012 ICM Crisis Communication Management Certification Course.
Feb. 7-8 & 9, 2012
May 15-16 & 17, 2012
July 17-18 & 19, 2012
Sept. 11-12 & 13, 2012

For more information go to:
http://www.crisisconsultant.com/certcourses_main.htm

If you are part of a management team, and particularly if you are on the crisis management team, you will find ICM's crisis training extremely valuable.

Whether you are responsible for internal or external communication or not, the ICM crisis training will be worth the trip. And even if you are not normally the designated spokesperson, the third day of spokesperson training will be helpful. The more you know about the media and how to "use" the media in a crisis or any other time, the easier it will be for you to do your job, regardless of what your responsibilities may be.

There is no company, organization or non-profit, no matter how big or small, that will not benefit from crisis communication planning, training and media/spokesperson training.

An Old Threat Still Hangs Over Us

2011-11-18T14:24:00.001-05:00

The Institute for Crisis Management has been warning clients and anyone else who will listen that every business, no matter how small or big, every organization -- for profit or non-profit--needs to have a Pandemic Crisis Plan.

Ten years ago I was speaking to groups all over the U.S., Canada and South America urging them to develop a crisis plan for the next Pandemic. Some listened, some pandemic plans were begun, but many blew it off.

The attitude was and still is, that isn't gonna happen. Medicine has advanced so much, doctors aren't going to let that happen.

This week The World Health Organization (WHO) hosted an international conference and issued a strong warning that another deadly pandemic is "a matter of when and not if," according to WHO Assistant Director-General of Health Security Keiji Fukuda.

In 1918/1919 50-million people died worldwide, with half-a-million of those deaths in the United States

There have been two smaller worldwide pandemics since 1919. The next one was in 1957 when the Asian Flu killed 70,000 Americans and the most recent was 1968, when the Hong Kong Flu killed 34,000 Americans and thousands more around the world.

In spite of the medical advances and the worldwide surveillance for signs of pandemic type infected birds, the experts at WHO still maintain the terrible disease, borne by birds that travel from country to country, is a significant threat.

Besides, we have argued, the Pandemic Plan is just a specialized part of any organization's crisis plan. Particularly that part of the crisis plan that deals with how your business or organization will respond to someone else's crisis.

An example: You're Ford Motor Company and you have this wonderful, modern plant in Louisville, KY that makes the new Ford Escape. The pandemic strikes the U.S. You depend on scores of plants around north America and Mexico to supply parts that ultimately go into making your new Escape.

The pandemic hits some of the communities with suppliers that you depend on. Half of the employees at six supplier plants are out sick or dieing. You can't get enough parts to build vehicles and then you realize 30-percent of your workforce is out sick or dieing. Do you have a plan for that?

PR Can't Prevent Or Fix Bad Managment

2011-11-18T11:24:00.001-05:00

The Penn State Football "crisis" has become a public relations problem for the University, but it started as a failing leadership/management problem.

I always say, "Doing the right thing is almost always the right thing to do." That may seem trite, but consider the whole Penn State dilemma. If the Head Coach and the Athletic Director and the Chief of the Campus Police and the President of the University had each done the "right thing" to begin with, there would have been a relatively smaller PR problem and the bigger problem -- sexual abuse of young boys -- would have been stopped sooner.

It doesn't matter what your organization does -- make millions playing football, manufacture widgets, provide a service or sell those widgets -- doing the right thing as soon as you discover someone in your organization is not, will save you potentially thousands if not millions of dollars in lost business or support and legal fees and settlements.

We have been called by potential clients in crisis and want us to fly in a fix it. I always ask what the organization is doing, or going to do to fix "it." And I often get this reponse -- "we're not sure, but while we decide what to do, we want you to come in and do your thing."

Our "thing" is to help leadlership explain what they are doing to their internal audiences, first, and then to all the important audiences outside. We can't, really we won't, cover for a poor or indecisive leader. We WILL help a management/leadership team identify what the real problem(s) are, and suggest steps they can and should take, and how to explain what they have decided to do or not do.

But, in most cases, when you see a business, hospital, university or other organization in negative news headlines, the crisis was probably smoldering for weeks or months or in the case of Penn State
for years before it figuratively blew up in their faces.

We call those "smoldering crises" and two-thirds of all organizational crises are the smoldering type.

They start out small and are undetected or ignored, and as a result they get bigger and potentially more dangerous and then, inevitably they explode in public view. Causing much more damage than they would have had they been dealt with when they first were discovered.

Who Tells The CEO He Can't Be The Spokesman In A Crisis?

2011-11-16T15:52:00.007-05:00

A recent study raises a question about whether the CEO is a good or bad choice as spokesperson in a crisis.

To begin with, the Institute for Crisis Management has always pleaded with clients to identify spokespersons other than the CEO. The CEO of any company in a crisis has more on his/her plate than any one person should be expected to manage and being the on-going spokesperson is almost a full-time job in itself.

Plus, if the CEO misspeaks, there is no one left who can step in and fix it!

There IS a place and carefully controlled situation when the CEO must step up and speak for the company, but not in an on-going spokesperson role.

But, if you won’t take our advice consider the new survey from the Public Affairs Council and conducted by Princeton Survey Research Associates International.

The latest survey of public opinion about the honesty and ethics of business leaders and lower level employees turns that whole thing upside down. The lower an employee is in the chain of command the higher he or she is considered as honest and ethical.

86-percent of Americans found non-managers ranked average or highly honest and ethical, while the same survey found only 50-percent of Americans rate the honesty and ethics of CEOs as average or high.

So, if you put the CEO out front in a crisis, you are starting at a 50-50 disadvantage with key audiences already doubting that spokesperson’s credibility.

It’s not hard to understand the results of the survey. Most people don’t live like a CEO and most don’t even know a CEO in person. However, they CAN identify with the “working man and woman.” They believe that people like themselves are honest and ethical like they are.

But that same survey found another reason why CEO’s are held in such low esteem – outlandish pay and bonuses. Even if the company is doing well, Americans do not like executive bonuses. And when times are bad, 87 percent oppose bonuses for top management.

Penn State a Smoldering Crisis for 17-Years

2011-11-09T16:39:00.005-05:00

“It’s not about Paterno or football, it is about making sure processes are in place and individuals are held accountable so Penn State’s name is never shamed again,” Paul Silvis, a member of Penn State’s board of trustees said shortly before veteran coach Joe Paterno confirmed he would be retiring at the end of the season.

Well, this post is not about Paterno or football or even Penn State. It is about any organization – business, charity, not-for-profit, public school or university having a plan in place to manage and communicate when something as big and smelly as the assistant coach molesting young men and boys blows up in your face.

First of all, this was what we at the Institute for Crisis Management call a smoldering crisis.

Former assistant coach Jerry Sandusky was temporarily jailed last weekend and charged with sexual assaults or advances on at least eight boys starting as early as 1994. Someone or several someones have known about the smoldering crisis for years. And someone could have started the process of shutting down the “problem” and beginning the process to both take care of the victims AND prepare the Administration and Head Coach to minimize the damage.

“This is a tragedy,” Coach Paterno, said in a statement released today by his public relations agency. “It is one of the great sorrows of my life. With the benefit of hindsight, I wish I had done more.”

And the school’s Board of Trustees issued a statement saying it was “outraged by the horrifying details” in the grand jury report about the Sandusky case.”

The statements are okay, but are 17-years late!

Every organization should have what we call a MEWS, or Management Early Warning System in place. Everyone in the organization should be educated and encouraged to pay attention to what’s going on around them and not be afraid to report potential problems to someone up the management chain. Even when it impacts your money making football or basketball program and its star coach.

The boys themselves may or may not have been telling anyone about what the “Coach” had or was doing to them...but very likely one or two did tell someone. If that person had only told someone else.

Well, a graduate assistant DID tell Paterno about Sandusky assaulting a boy visiting the Penn State locker room in 2002, but nothing was done to fully stop the molestations nor to take the appropriate steps to make it public, take care of the victims, apologize and begin immediately repairing the athletic department and university’s reputation.

Once again I appeal to leaders of all organizations to plan for every possible thing that can go wrong, from the building blowing up, blowing away or getting damaged by the stench of misbehavior by someone that works for you.

Mr. Cain Continues to Set An Example

2011-11-03T12:55:00.011-04:00

It’s not the right example, but it certainly is a teaching moment, not only for politicians, but for executives at every level of a business or organization.

GOP Presidential Candidate Herman Cain now says he told a friend of Presidential opponent Rick Perry back in 2003 about a charge against him while he worked for the National Restaurant Association in the 90’s. And, as a result, Cain is blaming the Perry staff for leaking the allegations of sexual harassment against him.

That raises the question: If he knew it was out there, why didn’t he have a prepared response?

When you have something that can be used against you or your company or organization, you must anticipate that it will come up at some time, and be prepared to make it a one-day story, not drag it on for days with denials, then half-truths, lame explanations and then blame the competition for stirring up the stink.

NBC News White House Correspondent Chuck Todd says, Cain has “evolved his explanation so much that it’s confirmed some of the charges, making his denials on all of them harder to believe.”

Let me 'splain this again: If you have something questionable or potentially damaging in your past, just assume that at some critical time in your career, your business or your campaign, it will come out -- sometimes accidentally, sometimes on purpose. Decide NOW what you can and will say, practice it out-loud, polish it, and be prepared.

At ICM we recommend you tell your side of what happened/or didn’t, say you made a mistake (if you did) and have been working to make it right (if you have) and say you’re sorry – and mean it.

It won’t always stop the damage from eating away at you or your organization, but most of the time it will be a one-day story and then disappear. It’s when you are not forthcoming, your enemies/opponents can and will keep chipping away at your integrity, reputation and name.

I know, you want to know what we would have suggested Mr. Cain say when the issue first came up.

How about something like this:

You’ve seen me speak and interact with staff and supporters and voters. Sometimes my attempt at humor succeeds and sometimes it doesn’t. There were two co-workers at NRA that apparently miss-interpreted something I said or did. At the time I said I didn’t mean to offend anyone, and I can say it again – if I offended either of those two ladies or anyone else, forgive me. I love my wife, I don’t need anyone but her.

Then when asked about it again, simply be prepared to say: I answered that question yesterday (or when ever) do you have anything you want to ask me?

An Invaluable Lesson From Herman Cain

2011-11-01T13:31:00.000-04:00

If Herman Cain accomplishes nothing else in his career, he is providing an invaluable lesson in how to respond to allegations of misconduct.

He was accused of sexually harassing two female employees while he headed the National Restaurant Association in the 90’s.

The first public statement on behalf of the Republican Presidential candidate came from his chief campaign aide Mark Block, who told MSNBC that Cain “never sexually harassed anybody. Period. End of Story. And he added, I am not personally aware of any settlement.”

In a later interview on FOX TV, Cain said, “If the restaurant association did a settlement, I wasn’t even aware of it, and hope it wasn’t for much.”

In a still later interview Cain’s story changed. He said, “Yes, there was some sort of settlement or termination,” in an interview with Greta Van Susteren.

Then on PBS, Cain said, “I was aware that an agreement was reached. The word settlement versus the word agreement, you know, I’m not sure what they called it.”

So on the first day Cain began with a declaration there had been no sexual harassment. And finally he concluded that one woman might have incorrectly interpreted something he said as being inappropriate and a settlement of agreement was reached.

Political pundits immediately began to ask “Can he survive this?”

That’s not the question to ask. The question to ask is why didn’t he respond truthfully and adequately to end the story on the first day, rather than draw the story out over several days, leaving potential voters to wonder what really happened and why didn’t he answer the question to begin with.

If you, or your company/organization are accused of something “wrong” answer as thoroughly as you can as quickly as you can, and then every time the question comes up again, simply respond with “I’ve already answered that, do you have any other questions?”

Phone Camera Warning

2011-10-26T11:40:00.001-04:00

If you are an HR Manager, a police officer, emergency medical technician, factory foreman, even a doctor or nurse working ER, always be on your best behavior, in addition to doing what you are trained and expected to do.

Phone cameras -- capable of recording both still photographs and moving video – are everywhere. If you “lose your cool” you will very likely show up on the local evening TV newscast at the very least or YouTube forever.

On the other hand if you do something above and beyond the call of duty, you may show up on the same TV newscast and YouTube in a favorable light.

Most often, the phone cameras catch people at their worst.

The police officer that over-reacts to an unruly demonstrator or drunk or mentally unstable person, caught on video swing his/her nightstick or spraying Pepper Spray in their face.

Or, the company representative that encounters demonstrators at the front gate, and after being verbally abused, over-reacts with a shouting spree response, caught on camera by another demonstrator.

I’ve been in some of these kinds of “heated” encounters. I once was riding in the front seat with a police officer. He picked up a 15-year-old at a community fair. The boy was obviously from a well-to-do family, but he was “drunker than a skunk” as they used to say where I grew up.

He was scared to death and could not stop talking and crying. The officer ordered him to shut up, but after a short drive, he had more than he could “take” and pulled a “black jack” out of his pocket and started to backhand the young man riding behind him. I automatically reacted. I stretched both of my arms out and yawned as big as I could, blocking the officer’s arm from striking his prisoner.

Needless to say, he was mad as all get out with me. But I reminded him about all the paper-work he would face if he had hit the boy and the boy’s family filed charges against him! Besides the police car was equipped with a camera that recorded “inside” as well as “outside.”

Sometimes it is very hard to maintain your composure but you must, and every organization should be teaching and advocating appropriate responses from all executives, managers and staff/employees.

Social Media: A Crisis Waiting To Hit

2011-10-21T13:16:00.000-04:00

Do NOT ignore social media!

Not only are the various social media great tools for reaching OUT to your employees, customers/clients/patients/students, financial supporters, suppliers, and others, those same social media can be used to launch an attack on your reputation, your service, product, mission, integrity, business, organization – and if you are not on guard and ready to react immediately, you will lose before you even get started.

A just released Ipsos Mori Reputation Council’s 2011 report found that only 59-percent of communications directors say they regularly pay attention to their company’s brand on social media channels.

That’s down from 73-percent in 2010.

Perhaps, just as shocking in today’s communications environment: when asked to what extent they actively engage with stakeholders through social media, 41-percent responded “not very much.”

The old axiom about maintaining a relationship with the conventional media, is just as applicable to the social media. When an organization is faced with a public crisis, you can respond and recover quicker if you already have a relationship with the key media that cover you.

The principle is built on the idea that reporters who know you, even a little bit, are more inclined to give you a break, or at least consider your “point of view,” than reporters who don’t know you and don’t care about you.

If you don’t have a company presence using social media channels, and suddenly you are in crisis and “show up” you are starting from a much deeper hole that you have to climb out of.

Prevent Crises Or Live With Them For A Long Time

2011-10-13T15:36:00.001-04:00

Planning and training to manage a business crisis IS important, but working to PREVENT crises is even more important and certainly more cost effective.

An example: The Toyota “unintended acceleration” crisis. It was a smoldering crisis, with unmistakable signs of a problem developing for Toyota, but ignored or unrecognized for months, if not more than a year.

There had been repeated indications of a problem with stuck accelerators and floor mats for more than a year before the first head-line grabbing deaths of a California police officer and his family.

There have been estimates that as many as 100 people died in Toyotas with accelerator problems.

So why am I bringing that up again nearly two years after the public became aware of the problem?

BECAUSE, this story is coming back to the top of the business pages of news outlets around the world, with the scheduling of the first wrongful death lawsuit trial in February of 2013. This trial is about the deaths of a Utah couple, killed when their Toyota slammed into a wall almost two years ago.

There are hundreds of other similar lawsuits waiting to go to trial. And, with the first one still more than a year away, Toyota will have to wait a lot longer before they can really put this crisis behind them.

Remember, our research repeatedly concludes that nearly two-thirds of all business crises are what we call smoldering crises. They start out small, and if someone is paying attention, they can be spotted and fixed before they ever grow to public crisis status.

That was certainly possible in the Toyota accelerator case, just like it was with the Firestone ATX tire debacle in the 90’s, before it became a public nightmare for Firestone/Bridgestone in February of 2000.

Plan, train and prevent!

Finally, Someone Did It Right!

2011-09-30T12:28:00.000-04:00

Monday morning, Sept. 26 someone or some group calling itself the “Syrian Electronic Army” hacked its way into the Harvard University home page, posting a picture of Syria’s president and a message that said, “SyRiAn eLeCTronic ArMy WeRe HeRE.”

“This site has been breached to spread our message even if illegally,” the hacker added. There was more, but you get the picture.

Hardly a week goes by that some institution or organization doesn’t make headlines because of an intrusion into their website. And there’s no way of knowing how many hacks go unreported.

Some just fix it and never say anything, others over-react, but the leadership at Harvard reacted about as well as any responsible decision maker could.

They acted quickly and said, “The University’s home page was compromised by an outside party this morning. We took down the site for several hours in order to restore it. The attack appears to have been the work of a sophisticated individual or group.”

The secret to their public response was acknowledging it happened, but not responding in any way to create more conflict, or give the perpetrator credit by name. Hacks are usually done for one or two reasons – just to be disruptive, or to get broader attention for their cause.

Harvard didn’t let the disruption last long, and did not sucker into a public debate about the hacker’s “cause.”

Don't Sell TV News Short, Yet!

2011-09-28T11:40:00.001-04:00

Local TV is the only source of news to beat word-of-mouth as the go-to source for local information, according to a recently released Pew Research Center and Knight Foundation study.

In a nationwide survey of 2,251 adults, 74% said they turned to local TV news at least once a week to get information about their community. That compares to similar research in the late 80s, when viewers watched local news at least four-times a week.

That old fashioned word-of-mouth came in second with 55-percent of those surveyed, radio with 51-percent, newspapers a shrinking 50-percent and the Internet with an increasing 47-percent, as a source of news and information.

Research shows that word-of-mouth grows in importance as the traditional media pay less attention to what's important to their viewers, listeners or readers. A Brookings Institute study found that family and friends were the most popular and reliable sources of a lot of information today.

One example was education and school news. When was the last time you saw a local television station cover a school board meeting when there was no big protest expected?

The Pew study respondents said if they were interested in weather, breaking news, politics or crime then TV news was the best source.

(Disclaimer here) I spent 35-years in newspapers and radio and television news, including about half of that as a newspaper editor or radio or TV news director.

It didn't used to be this way, but now local TV news ranks low as a source on such important things as business, schools, government and cultural events.

THE LESSON HERE: When you are facing a crisis or managing a crisis, after you are clear what the crisis is, the next step is to identify your key audiences, and before you start "communicating," identify the media that will best reach the key audiences that are important.

TV news mostly appeals to an audience over 40. Younger audiences tend to get their news and information from digital sources such as the Internet and mobile phones.

Who Do You Think Is Doing A Good Job?

2011-09-27T13:04:00.004-04:00

It certainly isn't the oil companies, managed care (HMOs) or health insurance companies.

A new Harris Poll measuring what you think about 22 of the nation's largest industries, concludes you don't think very kindly about some of the industries that we all have to depend on.

The poll is done every two years, and the most recent one was done in August, with interviews of 1,956 adults.

One "improvement" from the 2009 survey to this most recent one, found consumers think the automobile industry is doing a much better job with a 36-percent higher "positive," but in contrast, 27-percent say the airline industry is doing an awful job.

At the other end of the good job/bad job scale, supermarkets are ranked best with 90-percent of those surveyed giving a "good job" rating and only 10-percent a "bad job" rating for the nation's big food stores.

At the bottom of the list of 22 industries -- the oil companies with 33% of the respondents giving them a "good job" evaluation and 64% a "bad job" rating.

Tobacco companies were next to last and on-line search engines were 2nd from the top of the list. Hospitals were third with an 82-percent favorable rating and 16-percent bad-job rating. Two-percent were not sure.

Computer hardware and software companies were 4th and 5th, online retailers ranked 6th, Internet service providers were 7th and packaged food companies ranked 8th.

Car manufacturers were 9th and electric and gas utilities came it at 10th with a 70% favorable rating and a 29% unfavorable rating with one-percent undecided.

Telephone companies were 13th, banks 14th, drug companies 15th, cable companies 16th and airlines 17th.

Why does this matter? Dollars and cents is why it matters. Although most of us have no choice but to do business with many of these kinds of companies, where there is a choice, the business that treats us better than a competitor is more likely to get our money.

Beware of Whistleblowers!

2011-09-19T15:49:00.002-04:00

Not only should you plan for fires, explosions, natural disasters and workplace violence, but you MUST anticipate and be prepared to manage a WHISTLEBLOWER crisis.

The U.S. Government has reported a steady increase in whistleblower cases since 2005, and one of the nation's largest labor law practices has had an increase of 25-percent in whistleblower and retaliation complaints from 2009 to the present. They recently created a stand-alone specialty Whistleblowing and Retaliation Practice.

The U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) has seen an increase of 2011 whistleblower cases already totalling 2,339 as of last week, and that compares to 2,319 for all of last year and 2,010 for all of 2009.

So, you need a section in your crisis communication plan for a whistleblower sparked crisis and a response for a whistleblower who isn't accurate.

ICM had a relatively small company client with less than 200 employees. They had fired an employee for cause. That employee set out to "get even" by making whistleblower charges with a number of federal agencies and offices. The employee finally got a government lawyer to listen. It was likely the lawyer had political aspirations and saw an opportunity to use this case.

The company was well run, had a great reputation, and a number of government contracts. The only two people in the world who wanted to hurt the company was the fired worker and one government lawyer.

The company had ignored or missed a technical record keeping step and the whistleblower "got 'em" on that. The company paid a million dollar fine and the whistleblower got a couple of hundred-thousand dollars of the penalty.

By comparison, Bank of America was just ordered to pay a whistleblower $930,000 in interest and back wages and reinstate the employee. OSHA concluded, "This employee showed great courage reporting potential fraud and standing up for the rights of other employees to do the same." BoA was found to have used illegal retaliatory tactics against the whistleblower.

Several legal experts agree the increase in whistleblowing is a good thing, unless you are a company that is cutting corners, operating illegally or otherwise not operating in the public interest.

We recommend two things: 1. Don't do that! Doing the right thing is almost always the right thing to do. And, 2. Maintain a crisis communication plan, just in case you make a mistake and someone blows the whistle on your organization.

Workplace Safety Still Requires Planning

2011-09-16T16:38:00.000-04:00

While the Institute for Crisis Management's annual Crisis Report continues to conclude that "sudden" crises, such as fires, explosions, natural disasters and workplace violence still make up only about one-third of all business and organizational crises, it doesn't mean that you can let your guard down nor take steps to continue to minimize those types of business disruptions.

The U.S. Bureau of Labor Statistics has just reported the numbers for 2010 and they say there were 4,547 fatal work injuries in the United States in 2010 -- four fewer than in 2009.

The number of workplace homicides was down significantly last year -- seven percent fewer than in 2009 with 506 cases in 2010 and down more than 50-percent from 1994. The U.S. Labor Department had reported in some recent years as many as 700 workplace homicides, and thousands of non-fatal workplace attacks.

Returning to workplace injuries and deaths, the Labor Department says construction accidents account for more fatal workplace injuries than any other industry, with 751 deaths in 2010.

Some have argued that number is declining because there are fewer people working in construction jobs in the past three years, but the Associated General Contractors of American maintain the number is dropping because of planning and training efforts.

Deaths in the mining industry jumped 74-percent last year to a total of 172 fatalities. Leading that category were multiple deaths at the Upper Big Branch Coal Mine in West Virginia and the 11 deaths on the Deepwater Horizon Oil Platform that exploded in the Gulf of Mexico.

Operational Crisis Planning and Crisis Communication Planning should not ignore the more frequent "smoldering crisis" types, such as mismanagement, labor issues, activist protests, product defects and the many human resources types of problems, but at the same time, never stop working to prevent the sudden type crises, and plan for ways to manage them when they cannot be avoided.

A Cell Phone Could Put You Out Of Business

2011-09-05T14:48:00.002-04:00

If you have a small or even medium size business, have you thought about how a single cell phone could destroy everything you've worked so hard for?

A recent survey discovered that 32-percent of companies know or have evidence that distracted employees, using a cell phone, triggered an on-the-job crash. That is a sure fire basis for a lawsuit.
And, if there was serious injury or death resulting from that crash, the financial loss could wipe out even a medium size business.

The survey by ZoomSafer found that 62-percent of companies have written policies prohibiting employees from using mobile phones while driving on company business. That was relative good news, but the bad news--only about half make an effort to enforce that policy.

And of those who try to enforce the policy, 61-percent depend on after-the-fact disciplinary action.

Now for the really serious news --7.6-percent of the 500 companies surveyed have been sued as a result of an employee being distracted by a phone while driving. For companies with more than 5,000 drivers, 37-percent have been served with lawsuits.

71-percent of long-haul trucking companies, and 83-percent of local trucking companies have written cell phone use policies.

According to the National Highway Traffic Safety Administration, at any given moment, 11-percent of drivers are using their cell phone, and the National Safety Council estimates that one out of every four vehicle crashes involves a driver on the phone.

Remember, ICM research consistently reaffirms that nearly two-thirds of all business crises are preventable, and most of those driving while distracted wrecks could be prevented, if the driver was NOT using a cell phone.

A business crisis is still a business crisis, whether it was caused by a hurricane or a distracted driver.

Your liability is probably greater if the loss was caused by your employee, driving while distracted.

9/11 Anniversary

2011-09-01T14:00:00.002-04:00

Within 24 hours after the twin towers were leveled by hijacked airliners in New York City, we began to take a series of anxious telephone calls from companies and organizations all over North America.

There was no beating around the bush. Almost, without exception, all callers wanted to know if we could help them develop a terrorism crisis plan, and how much would it cost?

I made a quick decision that first day, and did NOT set out to take advantage of anyone. It would have been easy, and financially rewarding, but, instead I was honest with each caller.

I said, "I cannot guarantee you will never need a 'terrorism crisis plan,' but the odds are very slim, if you do not live and/or operate in New York City, Washington, DC, or maybe a handful of other major media markets."

I assured them the Institute for Crisis Management could help them develop a terrorism crisis plan, but added, "you are far more likely to experience one of a dozen more likely crisis types." And offered to
submit a proposal for a practical, custom crisis communication plan.

That was almost a daily conversation for nearly six months.

But as time passed, and the television news video began to lose its shock value, almost none of those organizations ever completed work on any kind of a crisis communication plan, let alone a terrorism crisis plan.

Nothing has changed.

Businesses and other types of organizations, including non-profits, higher education, healthcare and even professional organizations still face the same kinds of disrupting events and still need to plan and train for them.

ICM research See the Annual ICM Crisis Report reaffirms, year after year, that about two-thirds of all crises are preventable.

Even crises that cannot be prevented, such as earthquakes and hurricanes, can be anticipated, and recovery will be easier and quicker if you have a crisis plan and have practiced with that plan before the real thing hits.

Planning Pays

2011-08-29T12:06:00.007-04:00

Hurricane Irene took more than 40 lives, and left millions of people without electric power for hours or a few days, flooded neighborhoods, disrupted business, left thousands stranded for a few days in U.S. airports, damaged homes and business buildings up and down the east coast, and cost the late summer tourist industry on the east coast millions of dollars.

All on the anniversary of Hurricane Katrina.

By contrast, more than 1,800 people died during or as a result of Katrina, and the estimated property damage was around $81-Billion.

The Institute for Crisis Management has been saying for years that two-thirds of all business or organizational crises are preventable, and those crises that cannot be prevented, like a hurricane, can be significantly less traumatic and damaging with the proper planning and training.

Irene has helped prove that point, again.

Those organizations that had an operational crisis plan were prepared to protect their property and their people.

Those organizations that had a crisis communication plan were able to inform everyone of what was happening, what to do, when to do it, and reassure them they would all get through it.

Those organizations that had a continuity and recovery plan were ready to get back to work, to school, to serving their constituents as soon as it was safe to do so.

There will be unbudgeted costs and losses, but for those who had a plan; had trained with their plan; and used their plan, the costs and losses will be significantly smaller than they could have been and life will return to near normal within weeks, rather than years, if ever.

Supply Chain: A Crisis Waiting To Happen

2011-08-25T14:33:00.003-04:00

Did you ever consider your supply chain a “crisis waiting to happen?”

Do you have a supply chain vulnerability or risk assessment?

Do you have a crisis operations, communication and recovery plan for your supply chain?

Even if you answered “yes” to the first question, I would be shocked out of my socks if very many of you had an assessment of what could go wrong, and even more surprised if very many of your companies had an integrated operations, communication and recovery crisis plan for your supply chain.

Professor Alan Braithwaite at Cranfield University and LCP Consulting has written a very good White Paper, published by MissionMode Solutions, focusing on “overcoming operational glitches” – his tongue-in-cheek term for crises – in the supply chain. And he uses the term “supply chain” in the broadest possible way.

Professor Braithwaite made his point using Bear Stearns as an example. He pointed out they bought “bad” inventory in the form of worthless mortgage securities with no possibility of the supplier making good on them.

Even with the most basic concept of supply chains, manufacturers have dramatically increased their risk of supply chain “glitches” just to save a few dollars up front. When you bought parts from a supplier a state away, there were certain risks, but when you began buying those parts from the other side of the globe, the RISKS increased substantially.

Six years ago I was flying home from a client trip and my seatmate was visibly agitated and after we introduced ourselves and she found out I was a crisis consultant, she told me about her crisis.

She was on her way to the corporate headquarters of a major retailer that operates some of the largest and most successful outdoor stores in the United States.

She had to tell the CEO that the entire stock of the next season’s outdoor wear had been swept off container loading docks in Southeast Asia, and many of the factories where the apparel had been made had also been washed away. It was millions of dollars of inventory that would never reach their stores.

Of course, that paled in comparison to the more than 230,000 people who were swept away by the same tsunami.

Every business, of every size, has some kind of inventory which comes from a supply source, whether its auto parts or office supplies, electronic components or cleaning supplies.

When you review your crisis plans, next time, don’t forget the supply chain possibilities.

Smoldering Computer Crises Erupt

2011-08-15T12:53:00.001-04:00

Remember, we say two-thirds of all crises, on average over the past ten years, are preventable. And how many businesses or organizations are the victims of a computer generated crisis, almost daily now?

Our "down under" Crisis guy, Tony Jacques, tells the story of a Melbourne-based IT company that was the initial victim of a hacker. And the hack of the IT company knocked out the websites of 4,800 mostly small and medium size companies. The IT website host was forced out of business, and many of their small business customers may not survive.

That was purposeful, and might have been prevented or the damage minimized with better planning and crisis prevention.

Not too many years ago, we had a much bigger "host" company with several thousand customers, and a reasonable back-up plan for hurricane damage. But a so-called "perfect storm" knocked the host site out of service for several days and caused significant damage to hundreds if not thousands of their business website customers. The host company survived, and did the "right thing" by their customers, but not without considerable cost to the host and many of the businesses that depended on their company websites.

And if those examples were not bad enough, this past weekend, the Hacktivist group Anonymous launched an attack on the San Francisco Bay Area Rapid Transit System. BART was targeted after the transit system blocked mobile telephone service in part of its service area in an effort to thwart an anticipated protest and demonstration against BART.

I can go on and on with examples, but we still see so many business and organization decision makers that think the only kinds of crises their organizations face are fires, explosions and natural disasters. We are living in a world where computers have become such an important tool in how we do business, and at the same time one of the most powerful tools that can be used to disrupt business or even destroy a business or organization.

When you assess your most likely risks -- crisis origins -- make sure you put computers and the Internet near the top of your list.

Finally, Someone's Doing It Right

2011-08-05T14:59:00.003-04:00

It may have taken the US Department of Agriculture Food Safety and Inspection Service two weeks to take action, but once Cargill Meat Solutions Corporation was identified as a likely source of Salmonella Heidelberg contaminated ground turkey, they wasted no time initiating a voluntary recall of nearly 36-million pounds of fresh and frozen ground turkey products.

One person has died and at least 76 others in 26-states have been sickened by contaminated turkey.

Cargill immediately posted information about the recall on its website www.cargill.com and linked readers to its news release page for the latest information http://www.cargill.com/news-center/news-releases/2011/NA3047807.jsp .

Cargill operates four turkey processing plants, but has only shut down operations at the Springdale, Arkansas plant. Cargill President Steve Willardsen is quoted on the company's website announcing, "...given our concern for what has happened, and our desire to do what is right for our consumers and customers, we are voluntarily removing our ground turkey products from the market place."

Not only has Cargill used its website to provide information to consumers, but it is working with its grocery store and supermarket chain customers to inform the public about the potential risk and offering full refunds for any of their ground turkey products packaged between Feb. 20, 2011 and Aug. 2, 2011.

To top off all of those actions, President Willardsen added his own personal apology, "It is regrettable that people may have become ill from eating one of our ground turkey products and, for anyone who did, we are truly sorry."

Another Reason To Have A Crisis Plan

2011-08-03T15:40:00.000-04:00

A relatively new San Fransisco business that brokers rental properties....helping travelers find homes to rent, temporarily, or helping home owners to find temporary renters....found out the hard way why they should have had a crisis plan.

Airbnb is the company that helped a San Fransisco woman find a temporary renter for her home.

When the woman returned from her trip, she found her temporary renter gone, along with her camera, laptop computer, iPod and her birth certificate and social security card. They had been locked in a closet, but the closet was broken into.

The woman took her awful experience on-line, and it became a national story.

The woman talked to Airbnb several times, before she went public with her experience.

Company CEO Brian Chesky ended up doing the "right thing" for his client and his business, but not before significant negative publicity did it's damage.

Eventually he issued an "unconditional apology," and in a company blog, he wrote about the woman, "we let her down, and for that we are very sorry."

He added, "We should have responded faster, communicated more sensitively, and taken more decisive action to make sure she felt safe and secure."

". . . we weren't prepared for the crisis and we dropped the ball. Now," Chesky said, "we're dealing with the consequences."

San Francisco Police have a suspect in custody, and Chesky now insures his clients for up to $50,000 in damages and losses.

It doesn't matter how small or big your organization may be, or whether its for profit or a non-profit, it should have a crisis plan, and key members of the organization should be trained in using the plan.

Social Media: Friend or Foe?

2011-07-29T16:19:00.000-04:00

Hardly a day goes by that I don’t get one to 20 blast e-mails telling me how my business could really take off if only I hired someone to show me how to use Facebook and/or Twitter to grow my client base.

On the other hand, there’s hardly a week goes by that we don’t hear about a Tweet or Facebook incident that blows up in some organization’s face.

Symantec Corp. recently completed its 2011 Social Media Protection Flash Poll, and among the results they found many organizations had suffered through as many as nine “social media incidents,” in the preceding year. “Incidents” included such things as employees posting confidential company information on publicly accessible social media sites, such as Facebook and Twitter.

The report estimated 94 percent of those with “incidents” suffered negative results, such as damage to their reputation, data and revenue losses and loss of customer trust.

I am not a big fan of Facebook or Twitter because, no matter how effective they may be for your organization, there is an equal chance that critics or activists will over-run your Facebook site and turn it into a club to attack you or beat you to a figurative bloody pulp.

Last year Nestle had the distinction of being one of the first companies to have their Facebook site turned into a weapon, first by Greenpeace UK and then by other critics who took the Nestle logo and used it to poke fun and criticism at the company.

Apparently a Nestle lawyer took issue with that, and someone from Nestle posted a warning reminding Facebook visitors to be careful, because the Nestle logo — which many of them were defacing in their Facebook attacks — was a trademark.

CNet’s Caroline McCarthy called it “the first time that we've seen such a massive blow-up in the comments of a Facebook fan page.” And PRWeek observed the incident was “quickly becoming a social media crisis” for Nestle.

Now, if that is not enough to make you leery of using a Facebook site for your business or organization, there’s another reason.

Symantec is reminding us that if you get sued or otherwise involved in some kind of legal action connected to your Facebook page or Twitter account, you must have a system in place to be able to retrieve and store all that stuff, like you do e-mail and other digital data, and just like you should have been doing already with all your hard-copy letters, documents and records.

About Those Corporate Apologies

2011-07-27T10:58:00.000-04:00

Microsoft UK has used another of those semi-non-apology, apologies in England, after being called out for taking advantage of singer Amy Winehouse’s unexpected death.

Microsoft’s British PR department drew the ire of Winehouse fans with a tweet suggesting they remember her by buying her latest recording “Back to Black.” The on-line universe erupted with Twitter replies accusing Microsoft of being “crass” and “vile” in an effort to make more money off her death.

Someone at Microsoft United Kingdom responded at tweetbox360, “Apologies to everyone IF (my emphasis) our earlier Amy Winehouse tweet SEEMED purely commercially motivated.” The tweet added, “Far from the case, we assure you.”

How many times, in recent months, have we seen an executive or spokesperson for an organization issue an apology “if we offended . . .”? If an apology is appropriate, just apologize and get it over. Don’t put a qualifier on an apology. And, if you don’t mean it, don’t say it!

It was a couple of days later before Microsoft UK finally tweeted what should have been part of their initial public statement, "With Amy W's passing the world has lost a huge talent. Our thoughts are with Amy's family and friends at this very sad time."

What Next for News Corp?

2011-07-20T14:22:00.000-04:00

The question of the day is: Will the readers and viewers of Rupert Murdoch’s tabloid newspapers, television news networks and the Wall Street Journal continue to turn to those media outlets, or go elsewhere?

While the world has been watching the “voice-mail hacking, London police pay-offs, and British politicians courting News Corp executives” drama, many of us have been waiting for the other shoe to drop in the U.S. Ten people have been arrested and two key executives have resigned, including the Publisher of the Wall Street Journal.

Until Sunday that was the closest the drama had come to Murdock’s adopted homeland.

News America Marketing is a relatively small subsidiary of Rupert Murdoch’s News Corporation, and Sunday a New York Times investigative story reported that division, alone, has paid out at least $655 million to make embarrassing cases of corporate espionage and anti-competitive behavior disappear.

The voice-mail hacking story was broken by British competitor The Guardian in 2009 and according to the New York Times, News Corp spent $1.6-million trying to put a lid on that issue.

But here in the States, the tab for settlements and lawsuits began to mount. Minnesota state government accused News America of unfair trade practices and the company ended up paying “costs” and promising to stop falsely bad-mouthing competitors.

Next, in 2009, Floorgraphics took News America to court, accusing them of “hacking” into their computers and stealing proprietary information. The trial began, but it didn’t take News America long to see where the case was going and settled for $29.5-million and a few days later purchased the whole company.

The next year Valassis Communications filed suit and settled for $500-million.

That’s just the settlements we know about.

If General Motors or Bank of America paid a half-billion dollar settlement in a lawsuit, don’t you think the U.S. media would have reported that? Did you ever read or hear about the News America payout to Valassis?

Now, to the question that began this post:

Unless there are worse revelations yet to come, I suspect News Corp will continue to do business as usual and the people who currently buy their newspapers and swear by the political point of view of Fox News will continue to do so.

Rupert Murdoch: "We Are Sorry"

2011-07-16T16:25:00.000-04:00

Just a few days ago, the head of News Corp., Fox News, the Wall Street Journal and News of the World in London, Rupert Murdoch, said his company had made only "minor mistakes."

That didn't help. Two of his top executives resigned, including the Publisher of the Wall Street Journal. That didn't appease his critics. He gave up his effort to acquire full ownership of British Sky Broadcasting. That did not quiet his critics.

Finally, Mr. Murdoch took out full page advertisements in several British newspapers with a heading, "We are sorry."

In that ad, bearing his signature, it declared, "We are sorry for the serious wrongdoing that occurred. We are deeply sorry for the hurt suffered by the individuals affected."

It appears Murdoch tried the BP approach to crisis management. He began by claiming it wasn't all that bad. Then he offered an apology to anyone that might have been offended, and finally, he came right out and said he was sorry.

British parliamentarian John Prescott said Murdoch's apology isn't enough. "This is a man desperately trying to save his company and ditching everybody else in the process."

"We Report, You Decide"

2011-07-15T16:27:00.003-04:00

Can you believe and trust the people who bring you the news of the day?

It's getting harder and the free world doesn't need that.

I spent 35 years of my working life as a reporter, editor, anchor and radio and television news director. It was never a "job." Rather, it was a calling. I took the responsibility seriously and there are still days when I wish I was covering the "big story." But those days are fewer and farther apart.

The company that operates newspapers and a radio and television network that repeats the phrase over and over -- "Fair and balanced" -- appears to be neither fair nor honest.

We're in the second week of almost daily revelations of unethical and possibly illegal behavior at one or more of Rupert Murdoch's News Corp newspapers. A former British executive of News Corp has been arrested, and a trusted Editor in London has resigned.

And, News Corp. has hired a New York public relations agency.

Almost every day this past week I've been asked to rate how Murdoch and company are doing as crisis managers. I'm always reluctant to judge a company in crisis.

However, we teach PR folks to never stand in front of a burning building and ask a reporter,"What fire?"

Allegations that Murdoch's News of the World Sunday tabloid paid for information from London police officers and hacked the private cell phone of a murdered 13-year-old girl and possiby many other persons, brought this response from the head of the company, "...recent allegations of phone hacking and making payments to police. . .are deplorable and unacceptable."

At first I thought he was doing the right thing and expressing his regret for the behavior of his employees. But, then I read the statement again. It wasn't the action of his newspaper he found deplorable, it was the allegations he found unacceptable.

Frequently, here in the US, corporate executives apologize in the wake of some kind of scandal or wrong-doing and say they are "sorry if they offended someone." They're not sorry for what they did or said, they're only sorry if it offended someone. There's a big difference.

A lot of Americans still don't realize that Rupert Murdoch now owns the venerable American business news publication, The Wall Street Journal.

The scandal that is still rocking London raises a terrible question, "Has the Wall Street Journal been spying on Americans and paying bribes to news sources in this country?"

Digital Crisis Communication Planning

2011-07-07T16:12:00.000-04:00

A new study of corporate perceptions of crisis communications in the U.S., Europe, Asia Pacific and Latin America concluded that 79 % of business leaders surveyed believe their organizations are less than a year away from a likely significant crisis.

Executives from almost every industry, small or large, say a digital crisis is looming just around the corner.

Despite that confession, the majority are nowhere close to being prepared to prevent or manage a crisis that starts in the blogosphere or elsewhere in the social media. Almost half do not have even a basic social network monitoring system.

International public relations company, Burson-Marsteller, released the study at the beginning of July 2011, and it should get the attention of corporate leaders.

But, I fear, the old attitude, “nothing bad will happen on my watch” will prevail. Even with the admission that digital crises are looming over businesses of all kinds and sizes, less than one-quarter of companies surveyed, have any type of crisis communication plan for digital crises.

Advocacy Groups Are Gearing Up

Another recent survey sounds a clear warning – 74% of global advocacy organizations use Facebook, YouTube and Twitter to attack those corporations and recruit volunteers, activists and donors.

Since March of this year, at least a dozen major organizations have come under attack, and most were slow getting out of the gate to respond.

Among the “victims” – Sony Playstation Network, RSA Secure ID, Fox TV Network, Citigroup, Inc., Lockheed Martin, PBS, Google, Sonybmg, Nintendo, Turkish Government websites, Spanish National Police, International Monetary Fund, U.S. Senate, and the CIA.

There is no excuse, except denial, for any organization to fail to monitor the social media and watch for crisis warnings. There are more than 20 free or inexpensive monitoring tools available as well as thorough and effective mid-priced and high-price social media monitoring services..

The digital attack is no different than any other type of public opposition, except, it hits faster and spreads quicker. Any delay in heading it off, puts you deeper in the hole, before you begin to climb out.

Another Lesson: Don't Do This!

2011-06-23T14:01:00.001-04:00

Every organization and business, other than Transocean: Do as I say, not as Transocean does!

It's been 16 months since the April 2010 explosion on a Gulf Of Mexico oil rig that killed eleven men and dumped a ton of crude oil into the ocean.

Except for the eleven families, and many Gulf area businesses, most people have quit thinking about the disaster and oil spill.

So, Transocean reminded everyone this week, and, once again, blamed BP. Transocean said BP used a poor well design and failed to properly assess the risks and failed to alert Transocean to the dangers.

BP reminded the public that it had "stepped up to its responsibilities..." and added, "...Transocean continues to take every opportunity to avoid its responsibilties."

I know, I know, the lawyers made them do it.

Their lawyers are not worrying about Transocean's reputation, nor future business. They are concentrating on saving Transocean as many billions of dollars as possible and BP lawyers are trying to spread the cost of capping the well, cleaning up the damage and paying claims to families that lost loved ones and others who lost their livilhood, to as many others as possible.

It has been estimated that the total bill will exceed $41-billion, including $4-billion to $5-billion in fines.

So far, BP partner Mitsui & Co. has agreed to pay $1.1-billion and Weatherford International will cough up $75-million to help BP recoup some of its loss. Meanwhile BP is pressuring Transocean, Halliburton and Anadarko Petroleum Corp. to help with several billion dollars each.

The first of hundreds of spill-related lawsuits are expected to go to trial next February.

While the lawyers have their responsibility to their clients, my advice would be to stop pointing fingers, and settle every claim quietly and out-of-court. I'm not a financial expert, but I bet it will cost a lot less in dollars and added reputation loss, to pay whatever it will take to resolve all the claims and end the public spectacle.

What Do Delta Airlines & Rep. Anthony Weiner Have In Common?

2011-06-09T14:40:00.000-04:00

They both did things without thinking about the consequences.

Then one took action quickly, and the other equivocated for days before taking belated action.

Delta Airlines, looking to milk every last dollar out of its paying passengers, put a $200 per bag fee on checked luggage for all passengers who could least afford it in economy class. That fee netted $2,800 in extra profit for Delta earlier this week when 14 U.S. soldiers on their way home from fighting in Afghanistan each had an extra bag and were hit with the $200 fee.

They loaded a video on YouTube to tell the world how Delta was treating American servicemen and women.

Within hours, Delta posted a blog apologizing, saying they had made a mistake, and were revising that policy, and working with the soldiers that had to pay it.

Then there's Congressman Anthony Weiner the Tweeter.

He got caught sexting to some women on Twitter. First he denied it, then days later, in a tearful media encounter, he apologized and took responsibility.

Delta's already out of the headlines and Rep. Weiner is still making new headlines.

The lesson for every organization and individual in the public eye is to always do the "right thing." Consider the consequences of your business or personal decisions BEFORE you act on them. When something does go wrong, and you do blunder, suck it up, take responsibility, control the revelation, apologize if it’s appropriate and then get back to doing the "right things" again.

A Message From Our Sponsor

2011-06-06T16:16:00.002-04:00

Just a reminder, the next Institute for Crisis Management Crisis Communication Certification Course is July 12-13 & 14 in Louisville, KY and there are openings in the intensive two-day crisis communication workshop and the optional third day of media/spokesperson training.

The two-day training includes examples and case studies of the four kinds of business and organizational crises you face: sudden, smoldering, bizzare and perceptual. It includes how to identify your vulnerabilities, or as some people prefer your "risks" and how to prevent up to two-thirds of all potential crises.

The training includes what to include and how to get started on a crisis communication plan, and spends time talking about the digital crisis team, the importance of testing your plan and the other two major crisis plans every organization should have.

And, there is always a table-top exercise to give you a feel for what managing a crisis is like.

Attendees come from all around the globe and include folks from public relations, human resources, corporate counsel, risk management, and other upper level executive positions.

Attendance is limited to ten participants and there are still openings for the July course.

The optional third day of media training, is not limited to crisis training, but broader spokesperon training and includes three on-camera exercises.

For more information call 1-888-708-8351 or e-mail yvonne@crisisconsultant.com

Meet Erika

2011-06-03T11:24:00.000-04:00

In case you missed the recent announcement, Dr. Erika Hayes James has joined the Institute for Crisis Management, bringing with her a new and expanded set of experiences and services for our clients around the world.

Dr. James brings a broad range of talents and skills to add to the services already offered by ICM.

She is a highly respected business professor and published author in the management/business field, allowing ICM to strengthen our crisis leadership services and broaden our capability to include "thought leadership" in the area of crisis management and leadership in general.

Thought leadership implies knowledge creation, including research capability, knowledge translation -- turning research into practice, developing crisis management/leadership tools and assessment, and knowledge sharing -- consulting, leadership training as well as crisis communication training, and coaching.

I have worked with Dr. James at the Darden Graduate School of Business, University of Virginia since 2003. We hosted an international conference on Crisis Leadership and co-authored/edited a book on Crisis Leadership.

And she has co-authored a brand new book, Leading Under Pressure: From Surviving to Thriving Before, During and After a Crisis.

Learn more about Erika's new book and what she can do for your company or organization at http://www.erikahayesjames.com.

You Don't Have To Be A Politician

2011-06-03T11:22:00.000-04:00

New York Congressman Anthony Weiner has been the center of titillating media attention for a week now, because a picture of a man's "bulging" underwear was Tweeted to a college coed.

Weiner would not confirm nor deny the picture was of him, but he has been consistently adamant he didn't post it.

So, what if that picture was purported to be sent by the CEO or President of your company or your university, or your hospital, or the Superintendent of your school district? It could happen to someone like that just as easy as it could for a politician.

The irony of the Congressman's dilemma -- just a year ago, he married an aide to Secretary of State Hillary Clinton and former President Bill Clinton officiated. Now Rep. Weiner's failure to admit if the picture is of him, is being compared to Clinton and his infamous statement about "the definition of is" during the Monica Lewinsky scandal.

I ask again, what if this was your guy, or gal? How would you have them respond?

Things Can Change So Fast

2011-05-03T15:00:00.004-04:00

Within weeks after Harris Interactive completed the field work on their 12th annual U.S. Reputational Quotient Survey, some of the companies they praised so highly, took it on the chin.

In a news release, Harris Interactive said, “After falling to unforeseen lows amidst scandals, recalls and self-inflicted demonization economic crises, the American public’s perception of the reputation of corporate America appears to be on the rise.”

Harris reported, “Overall corporate reputation is experiencing rehabilitation as the American public gives high marks overall to corporate America…”

Google took over the top spot in the Harris survey, pushing Berkshire Hathaway to 4th.

Johnson and Johnson ranked 2nd, 3M Company was 3rd, Apple moved into 5th followed by Intel Corporation at 6th, Kraft Foods at 7th, Amazon.com to 8th, General Mills at 9th and Walt Disney Company 10th.

Now, here’s the problem. Google, the search engine giant, is trying to cope with a series of anti-trust investigations, some privacy issues and regulatory challenges

Johnson and Johnson has been making headlines for months because of massive product recalls. Defective replacement hips is one of more than 50 voluntary product recalls that J&J has issued just since the start of 2010, covering brand names that read like an inventory of the family medicine cabinet. Tylenol and St. Joseph Aspirin were recalled for foul odors people said made them sick. Benadryl and Zyrtec were recalled for botched amounts of ingredients. Rolaids were recalled for containing bits of wood and metal.

Warren Buffett and Berkshire Hathaway made negative news after revelations that one of his top lieutenants, David L. Sokol, bought $10 million of shares of Lubrizol while negotiating an acquisition of the company.

Apple was accused of tracking their phone users’ locations and storing the data for up to a year. The company never admitted it tracked individuals, but did concede their phones were storing some location data up to a year because of a software bug. It promised a fix to reduce the duration of the storage.

Amazon’s EC2 “Cloud” Web-hosting service crashed and took down scores of on-line operations that depend on Amazon to host their services.

Sony was not in the top 10, but Harris said the electronics company had scores indicating it had an excellent reputation. That was before April 20 when Sony shut down access to its PlayStation Network and waited seven days to tell its 77-million customers some of their personal information had been stolen then two weeks later Sony Online Entertainment announced another 25-million customers’ on-line data may have been high jacked.

Microsoft, the number seven ranked company the year before, fell to 16th in the results from the January-February 2011 survey.

There is a mixed message in the survey report.

1. Your reputation and public perception can plunge almost overnight, while it takes a lot more time to recover.
2. A big hit to your reputation and public perception may not automatically mean your company is toast!

To make that second point, consider BP is ranked 59th out of 60. And in spite of the mounting lawsuits and continued negative publicity, the company’s profits soared in the year since the explosion that killed eleven workers and polluted the Gulf of Mexico.

Wake Up Call for Water, Gas & Electric Utilities

2011-04-29T11:04:00.003-04:00

A wake-up call for public utilities across America and around the world should spur immediate action, but hasn’t.

A survey of 200 IT executives in charge of security at electric, oil, gas and water utilities in 14 countries, including the U.S. found 80-percent had already experienced some form of “denial of service” threats or attacks.

A report of findings, “In the Dark: Crucial Industries Confront Cyber Attacks” was unveiled April 21. It was commissioned by McAfee and prepared by the Center for Strategic and International Studies (CSIS).

About 70-percent of respondents confirmed they had found malware in their systems intended to sabotage their operations.

These utilities “all acknowledged being more worried, but they didn’t say they had done a lot more,” according to Stewart Baker, the lead CSIS researcher.

Almost 80-percent said their utilities had been targeted by at least one significant “denial of service” attack and 85-percent reported at least one network intrusion.

In spite of this alarming news, a third of the utility executives admitted they are not prepared and more than 40-percent conceded they expect an assault on their infrastructure within the next 12-months. The attacks, they say, could cause a loss of service for a day or more and possibly result in loss of life or personal injury.

Another recent study by the Ponemon Institute confirmed that electric, gas and water utility executives were more concerned about system glitches, downtown and regulatory and legal compliance than the safety and security of their operating and delivery systems.

What does this mean to you?

If you are a utility manager, systems manager, communications manager, or customer relations manager , you should be working to prevent the kinds of things the report highlights, AND you should be creating or updating your various functions’ crisis plans – operations, communications, continuity and recovery plans.

Don’t end up standing in front of the cameras with a bewildered look on your face and unable to explain why you can’t deliver safe water, or dependable gas or electric service or even when you will be able to restore service to your service area.

You’re not gonna believe this! Oh, yes you will!

2011-04-28T17:06:00.004-04:00

When Amazon’s EC2 cloud services system crashed a week ago, shutting down service to scores of client companies, it not only inconvenienced many of them for days, but somehow wiped out critical company data for some of them

That’s not the part you’re going to have trouble believing.

Here’s the unbelievable part.

Besides the fact Amazon still hasn’t explained what happened to its supposedly safe and reliable data storage system, it is now telling a few clients some or all of their stored data is gone and in some cases only partly retrievable.

But wait, it gets worse. One of their customers got an impersonal e-mail this week, which began: “Hello,” and explained that while trying to recover one or more of “your Amazon EBS volumes” Amazon was only able to recover an “inconsistent data snapshot.”

The e-mail did say, “We are very sorry, but ultimately our efforts to manually recover your volume was unsuccessful.”

Now here’s the really unbelievable part: “What we were able to recover has been made available via a snapshot….If you have no need for this snapshot, please delete it to avoid incurring storage charges.”

Wait, there is good news, in the last paragraph of this generic e-mail they did add, “We apologize for this volume loss and any impact to your business.” The message was signed “Amazon Web Services, EBS Support.

I know, I know, you didn’t expect much more.

Why didn’t someone personally call the client and apologize and explain what happened and what is lost and offer to help in anyway, rather than remind the client they would be “facing storage charges” if they didn’t delete the junk Amazon saved for them.

Just when I think intelligent and otherwise successful people cannot surprise me anymore, one does.

Sony and Amazon, Thanks for the Lessons

2011-04-27T11:00:00.008-04:00

Wow! What Were They Thinking?

April 20 Sony shut down access to its PlayStation Network and waited seven days to tell its 77-million customers some of their personal information had been stolen.

In fact, when Sony finally did say something, they conceded they discovered hackers were in their system between April 17 and April 19. They didn’t shut down the system for another day and then waited until April 26 to tell their gamers/customers something had gone wrong and an unauthorized person or persons had got away with their names, full address, e-mail address, date of birth, PlayStation/Qriocity password and log-in information, and handle/PSN online ID.

Sony seemed to reluctantly add it is possible the thief also downloaded your password security answers and purchasing history.

You can imagine the outrage from PlayStation gamers. It’s a little hard to tell whether some of them are more irate because they can’t access the Network and play, or because their personal data has been stolen.

But there is no question about the reason for the outrage from U.S. Sen. Richard Blumenthal. The Connecticut Democrat sent a letter to the head of Sony America demanding an explanation why Sony waited so long to alert their customers about the data theft. Sen. Blumenthal told Sony head Jack Tretton, “…it is essential that customers be immediately notified about whether and to what extent their personal and financial information has been compromised.”

To make matters worse, after public criticism when Sony finally did reveal some details, the company came back with an additional comment claiming they didn’t know personal information had been stolen until just the day before (six days after they shut down the network and 9 days after the attack apparently began.)

How could they not know? Why did they not check that first?

The same week Sony was turning off its phones and ignoring e-mail and tweets, Amazon’s EC2 “Cloud” Web-hosting service crashed and took down scores of on-line operations that depend on Amazon to host their services. Some were only getting back on-line 80-plus hours later.

Amazon had very little to say. In fact, a search of the www.aws.amazon.com/ecs website made no mention of the outage, and continued to display this reassurance on the home page:
“Secure – Amazon EC2 provides numerous mechanisms for securing your compute resources.”

I’m not a “compute” expert, so I don’t know if they have a typo on their home page, or “compute resources” means something special.

Amazon and Sony operate in their own world…for the rest of you…don’t do as they do.

If you have a data loss or meltdown, be prepared to acknowledge it as soon as possible, and at the same time, begin reassuring your customers, partners, employees or whoever may be impacted, that you are working on it.

If you’ve caused them harm, express your regrets, and offer to do what is reasonable to minimize the damage you may have caused.

Some lawyers will likely counsel you to keep your mouth shut and don’t take any responsibility for what happened. There may be rare occasions when that is good advice, but most of the time that advice will cost you more in the long run.

You can anticipate all the things that might go wrong with your data handling and storage systems and have a plan, including a communication plan, in place and ready to activate when the disaster strikes.

When Crisis Planning, Nothing Is Too Far Fetched

2011-04-22T14:13:00.003-04:00

Nothing is too far-fetched when it comes to crisis planning.

So often, when we work with clients preparing crisis plans, they think in terms of fires, explosions, natural disasters or work place violence. We encourage them to consider all the “people” kinds of things that can go wrong, also, such as all the forms of harassment and discrimination, unethical behavior, criminal activity and mismanagement.

But there’s one other thing to consider – rarely is a business or organizational crisis just one “thing.”

When crisis planning, or anticipating a crisis drill or table top exercise, think “unrealistic” and you will more likely be “realistic” in your crisis anticipation.

A case in point: Japan.

You don’t have to imagine the complicated series of events, they really happened.

It started with a near record earthquake. Then came the tsunami, followed by massive fires and a nuclear disaster, then snow and miserably cold weather, followed by massive power outages, food, fuel and water shortages, and thousands of missing people.

Does your crisis plan have a section for that kind of crisis? It should.

I often joke with clients that their crisis plans should be like the old Sears Roebuck and Company line of children’s clothes, branded as Geranimals. The idea was that dads never could dress their young children properly, so Sears offered a line of clothes that had pictures of animals on a tag. If dad was to dress his three-year daughter for the day, he would look for a blouse that had a tag with a lion head on it, and a skirt or slacks that had a lion head on it and he was good to go.

Crisis plans and standby statements can be prepared well in advance of anything ever going wrong. Then, when “X” happens you look for those parts of the crisis plan and those pre-approved standby statements that go together, and you are on your way to taking control of even the worst situations.

Few Companies Are Crisis Ready: But We Knew That!

2011-04-12T13:36:00.004-04:00

A new report out this week confirms that one of the biggest mistakes companies make in a crisis is a failure to communicate and be transparent with employees and other key stakeholders.

The report concludes the failure to communicate in a crisis contributes to a loss of value to the company.

The survey was conducted by the Canadian Investor Relations Institute (CIRI) and Fleishman-Hillard, Inc. in September, October and November of 2010 and included responses from 34 financial analysts and 78 investor relations officers in the United States and Canada.

One of the disappointing conclusion of the survey is that many companies are aware of the potential damage they face to their sales, reputation and share value, but many still do not have a crisis plan, and if they do, they admitted it was very likely outdated.

The report confirmed that half of the respondents from financial services and the health care industry don't use a crisis plan, even if they have one.

Recalling the financial crises that slammed the world since 2008,Tom Enright, CIRI President and CEO concluded, "...companies need to be armed with a plan." Amen! That's what we've been arguing for more than 20-years.

If you don't believe us, then heed Enright's words, "No sector or company is immune to a crisis. Having a crisis communication plan in place is simply prudent."

Thank you, Mr. Enright.

Another short-coming underscored in the report -- Of the few companies that have a crisis communication plan, only 29-percent update it annually.

Another disturbing finding -- More than 50-percent of respondents say they only have a crisis plan for an operational issue such as a fire, storm or perhaps workplace violence. Never mind that two-thirds of all business crises have nothing to do with "sudden events" and almost everything to do with human mistakes.

Another frightening finding -- Less than half of the companies surveyed monitor social media during a crisis.

How Would You Like to Be Head of Corporate Comms at Chase?

2011-04-08T16:43:00.004-04:00

How would you like to be the head of corporate communications for JPMorgan Chase & Co.?

Chief Executive Officer Jamie Dimon’s total compensation skyrocketed almost 1,500 percent to $20.8 million in 2010 from $1.3 million a year earlier, based on a U.S. Securities and Exchange Commission compensation formula regulatory filing.

By comparison, real median U.S. household income was just $49,777 in 2009, according to the U.S. Census Bureau and certainly did not jump 1,500 percent in 2010, at least mine didn’t.

With all the negative news about U.S. banks during the past two years, and the hike in bank fees and the precipitous drop in bank interest rates, it will be challenging for the Chase PR folks to justify their boss’ pay, perks and bonuses.

I’m a Chase customer, and my savings account interest rate is almost a negative number, now, and on top of that, I got an e-mail from Chase a few days ago, explaining their vendor, who sends out all of their irritating marketing e-mail, had not encrypted my name and e-mail address, and millions of my co-customers e-mail addresses had been stolen.

The thieves probably sold our addresses to spam merchants who will soon be bombarding our in-boxes with more unwanted junk e-mail – at the best – and just as likely filling our in-boxes with programs that can take over our computers and infect them with viruses.

If you read the story about Dimon’s humongous pay increase, you probably did feel sorry for him, at least for a moment. He changed jobs and moved from Chicago to New York City, and had trouble selling his house in 2010. But don't worry about him, Chase reimbursed him $421,458 for some of his "moving expenses."

Watch And Learn From New Google CEO

2011-04-05T14:16:00.004-04:00

If you work for a CEO or President or chief administrator that is uncomfortable dealing with the media and/or the public, OR if you are the CEO, President or chief administrator that avoids the media and dealing with your key publics, then pay attention to what happens next at Google.

Larry Page, co-founder of Google, was elevated to the CEO’s job this week.

He took over at a time when the search engine giant is trying to cope with a series of anti-trust investigations, some privacy issues and regulatory challenges. Now he must lead the company through increasingly negative public perceptions and growing media attention.

People who know him say he is a genuine brainiac and the father of many of Google’s most important technical innovations.

They also describe him as “awkward, aloof and dismissive” of people who don’t think the way he does, which apparently includes most of us.

It is also widely accepted that Page does not like to deal with the media.

Rob Frankel, author of “The Revenge of Brand X,” cites Google’s slipping image and says when you link that “with a guy like Larry Page, who may not be the most skilled or motivated person to deal with it, there could be trouble.”

At ICM we consistently preach against the CEO being the on-going spokesperson in a crisis, but Google is not in a crisis. Not yet, anyway. However, it is facing significant challenges, and an enthusiastic and committed CEO needs to be out there talking up the “positives” about his organization.

Robert Enderle of the Enderle Group was quoted in the San Francisco Chronicle saying Page needs to be the public face of Google, “and he doesn’t seem to want that.” Enderle added, “…he has to do that job. Right now, Google has a horrible public image, and he’s got to fix that.”

No One Is Exempt From Crises

2011-03-30T11:03:00.003-04:00

The Fiesta Bowl Board of Directors has fired long-time President John Junker.

At the Institute for Crisis Management we're always looking for "lessons learned" in cases like this, and it appears the Board's decision to "take decisive action" is the most significant of two lessons here.

The Board initiated an investigation that found Junker had likely violated state and federal campaign finance laws, involving a scheme to reimburse employees for political campaign contributions, then he took part in "an apparent conspiracy" to cover it up.

The ultimate investigation found "excessive compensation, non-business and inappropriate expdenitures and inappropriate gifts." You can read the 276-page investigative finding at www.fiestabowl.org.

There is another lesson here too.

Although the Board has acted decisively, there are "aftershocks" that may cause even more harm. The Fiesta Bowl grew from a regional event to a major BCS Bowl. Now BCS Commissioner Bill Hancock says the Fiesta Bowl could lose its coveted top bowl rotation.

Hancock has said there could be other sanctions.

Almost all business and organizational crises have, what we call "crisis aftershocks." And just like the aftershocks following an earthquake, some of those cause more harm than the initial event/quake, and other times they just distract management from the original problem.

A School Shooting Affects Many People

2011-03-28T12:28:00.003-04:00

A recent student attack on another student at a Middle School in Martinsville, IN, left one 15-year-old boy in critical condition days after the shooting and another 15-year-old boy in jail.

Their lives will never be the same. Their parent's lives will never be the same.

What about all the others?

School administrators and teachers in that building and in the rest of the schools in the system will be changed.

Many of the students and their parents will need help coping with the shooting.

Melissa Payne, a nurse at a Martinsville hospital was on duty when word of the shooting at her son's middle school reached the hospital. She tried calling his mobile phone, but he forgot and left it at home. When she couldn't reach him to be sure he was okay, she left her work and rushed to the school.

It took some time to find him. The school was locked-down for hours and hundreds of frantic parents assembled outside, waiting to claim and hug their sons and daughters.

Mental health experts say the first reaction of students and faculty is shock.

Bill Krise said his eighth grade step-daughter and her friend were within yards of the shooting and saw the victim lying on the ground and bleeding. He's already arranged for grief counseling for his whole family.

Clint Oliver, a clinical psychologist, says the shock of a violent event is felt by an entire community, whether its in a school or a workplace.

Shock, fear, disbelief, then anger and or sadness settle in.

With all of your other crisis planning, we urge you to include grief counselors and other employee assistance programs that can begin immediately and continue for months, and longer in some cases.

If you have more than a handful of employees or you oversee any kind of school, from nursery school to elementary, middle, high school or college or university, please include in your workplace/schoolplace violence or facility disaster plan a specific holding area, or meeting place, for evacuated faculty/students/employees; another for families and off-duty employees that will rush to the scene; and a third area for the media.

Those areas should be identified before you ever have a crisis and they should be separate and, where possible, identify restroom facilities that are ONLY for one of each group.

The holding area for evacuees and the holding area for families, friends and off-duty workers, should be protected from access by the media.

Facing a Crisis? Fix It, Don't Hide!

2011-03-18T15:38:00.001-04:00

Bad news tends to makes more bad news, whether you’re in Japan or selling alcohol wipes to thousands of hospitals, clinics and doctors in the United States.

This week, a company apparently formerly known as the Triad-Group, announced its third recall in as many months. This time the company is recalling thousands of “povidine iodine pre pads” which may be contaminated with Elizabethkingia meningoseptica, an organism that may cause rare, but serious infections, including meningitis in newborns, pneumonia in patients on ventilators, and a flesh-eating bacteria that infects some humans.

I say, apparently “formerly” known as Triad-Group, because a search for their website at www.triad-group.net now has no sign of a company name, contact information or any other link to who or what the company is or does -- just the most recent recall notice.

The recalled product is packaged wipes used to prevent infections from cuts, scrapes and burns prior to surgery. The first recall was alcohol pads used to wipe the skin before an IV or other needle was inserted.

Triad put out a news release about the latest recall, under the name of the parent company, H&P Industries. Reporters were unable to get anyone from the company to respond to questions and the Triad website shows no company name, contact link or other information.

One law firm claims more than 100 people have called wanting to sue Triad because of problems after being treated with the alcohol wipes or another product, a lubricating jelly used by OB GYN doctors.

The most recent recall included iodine wipes sold by Triad/H&P Industries Inc. and packaged under the names Cardinal Health, Medical Specialties, VHA, Triad, Triad Plus, North Safety and Total Resources.

A month ago, the company said it shut down the production line that made the contaminated wipes and jelly, but there were reports they would continue to sell those products under generic and store brand names.

Don’t think you can do what this company appears to be doing and get away with it. You can’t change your name or business identity and continue to sell dangerous products and get away with it very long.

A company called Sierra Pre-Filled, owned by a Chicago doctor, was making and selling contaminated heparin-filled syringes last year, and when the lawsuits and federal investigations started piling up, he skipped the country.

Ask Your Management Team If They Are Ready?

2011-03-17T13:00:00.006-04:00

What a learning opportunity we have in the Japan triple disasters.

Consultants at the Institute for Crisis Management report back regularly that the initial crisis call was quickly compounded by a second or third or more crises.

In Japan the initial earthquake, one of the worst in modern history, quickly triggered the second crisis event – a major tsunami – and then damage to a major nuclear reactor complex.

Buildings were destroyed, people and property were swept away, electric service was disrupted and leaking radiation threatens thousands, if not millions of lives.

Your office, plant or other facility may never catch fire, blow-up, flood or be leveled by some natural disaster. But that doesn’t mean your operation will escape disruptions.

A crisis plan – three, in fact, should include an operational crisis plan, a communication plan and a continuity/recovery plan. They are essential to all well-managed organizations. That includes large and small businesses, manufacturing or service based, not-for-profits, public and higher education systems, health care operations and even religious organizations.

According to the U.S. Nuclear Regulatory Commission, there are 104 nuclear power plants in the United States, and in spite of public attention on the earthquake zones up and down the west coast, the power plant at highest risk is on the Hudson River 24 miles north of New York City.

Who knew?

Do you know how many thousands of businesses, plants, hospitals, schools, not-for-profits, and religious organizations are in a 100-mile radius of that nuclear facility? Are you located there?

You don’t have to have a crisis to have a crisis. But, you do need to evaluate the risks around you, and plan for them, just in case.

It doesn’t have to be a nuclear power plant, either.

We created and executed a table-top exercise not long ago, for a corporate crisis team. It was in the food sector and the exercise was to test their ability to manage a food contamination crisis.

But, their corporate headquarters is near the interchange of a multi-lane expressway and major cross highway. So, an hour into the half-day exercise, we arranged for a call to their “war room” announcing that a fireman was in the lobby ordering all 300 employees to immediately evacuate because a hazardous semi-tractor load had just been dumped 500-yards from the back side of their office tower.

They had a contingency built-in to their crisis plan for an alternate command site, up-wind and far enough away to safely work from. They got an A+ for their planning and their execution.

Are you prepared?

J & J and Triad Recall Costs

2011-03-11T13:54:00.005-05:00

Johnson and Johnson and Triad Group are paying a big price for their mistakes.

On the one hand, the U.S. Food and Drug Administration has prohibited J & J from reopening its Fort Washington, PA plant until it meets FDA quality standards. The plant is one of three tied to repeated recalls of defective or contaminated medications, including Children’s Tylenol and Benadryl and Motrin.

Triad, on the other hand, announced it was discontinuing use of a production line at its Hartland, WI plant that was the production site for millions of packages of contaminated alcohol wipes and lubricating jelly.

J & J says it will continue to make the same products at plants in Las Piedras, Puerto Rico and Lancaster, PA. Triad announced it will continue to make wipes and lubricating gel under private labels and store brands.

Eric Haertle, Triad’s COO, and one of three siblings that own the private company, said the massive recall and mounting number of lawsuits against the company have led to “difficult times” for the family owned business, but he insisted they would be “cleared of all charges.”

The odds are against you, if you need a shot or an IV in your doctor’s office or a hospital or emergency clinic. In spite of a nationwide recall, it’s hard to imagine that all of the millions of wipes packages and lubricating jelly have been removed from supply cabinets. And health experts say they are even more concerned about the potential millions of homes that have packages of contaminated alcohol wipes in medicine cabinets with store brand names on them.

J & J has had 20 recalls since September 2009 including children’s medicine, contact lenses and hip replacement hardware.

So what does this mean to you and crisis planning, prevention and crisis management?

Both companies are taking major hits to their bottom lines. In its most recent reporting quarter, J & J recorded a 12-percent drop in profit, and sales of the company’s over-the-counter medicines were down more than 19-percent for 2010.

And, Triad is facing a growing number of multi-million dollar lawsuits, plus they are no longer manufacturing and selling wipes and gel to doctors and hospitals.

Remember, we always say, two-thirds of all business crises are preventable. Both companies could have prevented the crises they are facing.

YOU CAN AVOID MOST CRISES, TOO. All you have to do is the right thing, for the right reason, every day. Cutting corners and ignoring the “little things” will almost always end up biting you where you sit.

Be Cool or Freak Out

2011-03-07T15:59:00.002-05:00

Business executives and the leaders of most other kinds of organizations are not exactly breaking down our doors wanting to know what they need to do to prevent crises or how to prepare to better manage the one’s they can’t avoid.

Here’s something to give them pause. Psychologist John Leach says when a random group of people find themselves in an emergency, such as a fire or natural disaster, 10-to-15 percent will consistently “freak out,” 10-to-20 percent will stay cool and composed and the rest will become “dazed and hesitant sheep.”

Another study says less than one-fifth of us will naturally react well in a crisis.

While doing research for his new book Nerve, Taylor Clark has concluded that many of us can overcome our predisposition to freak out or become dazed sheep through training! Who knew?

Psychologist Anders Ericsson says no matter whether you’re facing gun fire or an important presentation at work, practice under realistic conditions is a sure-fire way to get the best result.

What we’re talking about here is crisis planning AND crisis management practice. A table-top exercise a couple of times a year, using your crisis operations and communication plans will increase your odds of more successfully getting through the next real disruption.

Do you want to be one of those 20-percent that freak out, or 15-percent that stay cool?

There’s an old joke about a young person who stopped an old man on the street in New York City and asked him how to get to Carnegie Hall. His response, “Practice, Practice, Practice!

My response when asked how to survive a business or other organizational crisis, “Practice, Practice, Practice!”

Your E-Mail, Wikileaks and the Cloud

2011-03-01T13:50:00.003-05:00

E-mail made news twice in February and both incidents should send shivers up your spine.

The most recent incident was Feb. 28 when 38,000 Gmail users could not find their e-mails. That was a fraction of total Gmail users, but that didn't matter if it was YOU and your e-mail disappeared.

Google engineers were still trying to figure out what went wrong three days after the bazaar disappearance. Most, if not all Gmail users had their e-mail restored within 24-hours.

The other heart-stopping story began earlier in February, when hackers, who call themselves "Anonymous" broke into the computers of HBGary Federal, a government contractor.

They stole thousands of employee and company e-mails and then posted them on a "searchable" Web site, much like Wikileaks has done with government documents.

The people behind Anonymous are apparent supporters of Wikileaks and the CEO of HBGary Federal, Arron Barr had tried to discredit Wikileaks and then threatened to publicly expose the people behind Anonymous.

So they struck first.

Here's the problem: Losing your e-mail is one thing, but what Anonymous did to HBGary Federal, they or others like them, can do to YOU and/or your organization. Just think about some of the e-mails you've written and saved and what they might look like to the wrong audience? Or, what about e-mails your staff or employees may have written about your organization or you?

Now, let's go back to the Gmail problem.

In the wake of the "lost" Gmails, there has been new interest in backing up more and more digital material on so-called "cloud based" systems. I work with some very intelligent computer specialists, who brag about the "cloud" and all of its possibilities. They, and others like them, believe their information is accessible at any time, from anywhere...and I fear they could be wrong.

Cindy Cohn, legal director of the Electronic Frontier Foundation says, "We think of cloud computing as a bunch of clouds. They're fluffy and white, but it's actually other people's computers and other people's computers can go down."

In fact, my great concern is that those "other people's computers" can be hacked and your important documents and e-mail can be stolen from there, too.

This month has motivated me to move my "saved" e-mails from my computer to an off-line hard drive storage device, along with all my other sensitive client documents.

Think about it!

Did Anyone Notice Toyota Was Right?

2011-03-01T11:36:00.004-05:00

Toyota cars did not have an electrical "fault" that could trigger "unintended sudden acceleration" according to a recent report from the National Highway Traffic Safety Administration (NHTSA).

A 10-month long investigation appears to have proved what Toyota had maintained all along -- floor mats and driver error caused the sudden acceleration that made national headlines much of last year.

Now the question is: Is anybody paying attention? Does anyone care?

In 1986 Audi cars were the focus of a CBS 60-Minutes story that blamed faulty Audis for a series of car crashes following "sudden acceleration." Audi quickly spoke up and honestly explained to reporters that drivers were prone to hit the wrong pedal, in a panic, and instead of hitting the brake they were pressing down hard on the accelerator.

Toyota executives apparently assumed that last year, but were wise enough not to blame their customers like Audi did 20-years earlier. Even after federal safety experts cleared Audi, consumers were very slow to come back to the brand.

Toyota did not publicly blame its customers this time, and still got hammered in the media. But, the Japanese automaker seems to be recovering much quicker than did Audi.

So, what's the lesson?

Produce quality products, don't be too quick to point fingers when something goes wrong, commit quickly to investigate what went wrong and promise to fix it, if it needs fixing. And then work with the appropriate agencies and authorities to find answers and a fix.

Another Preventable Crisis

2011-02-22T12:48:00.005-05:00

The Triad Group of Hartland, WI is fast becoming the latest posterchild for preventable business crises.

2-year-old Harrison Kothari of Houston, TX died Dec. 1, 2010 from a rare infection that has been linked to a contaminated alcohol wipe used in a hospital. His parents have filed a "gross negligence" lawsuit. At last count this week, more than 50 potential victims have contacted plaintiff's attorneys wanting to sue. That number is sure to swell.

Then, this week, to make matters worse, it was reported that the U.S. Food and Drug Administration (FDA) found signs of sterilization problems and contamination at the Wisconsin plant in July 2009 and didn't take any documented enforcement action.

Additional government documents indicate inspectors found similar sterilization problems in the same plant a year later, with still no sign that a clean-up was ordered.

In fact, MSNBC.Com has found FDA documents from the summer of 2009 that say, "Procedures designed to prevent microbiological contamination of drug products purporting to be sterile are not followed."

After the death of the Texas boy, Triad began a recall of millions of alcohol wipes, potentially contaminated with the rare bacteria Bacillus cereus. The FDA has received at least 100 reports of problems likely caused by the contaminated wipes since the recall was announced.

After the death of the 2-year-old, FDA launched an investigation, but neither the FDA nor Triad are talking.

This is beginning to look like another company that ignored the warning signs of impending trouble and will have no one else to blame when the company collapses and fails.

Remember, two-thirds of all business crises are preventable. All you have to do is look for the signs of trouble and take action to fix what ever is wrong then, not later.

A $30-million lawsuit has since been filed by a Tennessee man who had to have open-heart surgery after his heart was infected with the rare infection.

In addition to the victims of the contaminated wipes, FDA now joins the government agencies that failed to do their jobs, which contributed to the Massey Coal Mine disaster and the BP oil well explosion and spill.

The BP Verdict Is In

2011-02-17T15:06:00.003-05:00

The verdict is in, and as the Institute for Crisis Management says so often, "The sad fact is that this was an entirely preventable disaster."

It was also the conclusion of Fred Bartlit, chief counsel for the Federal Commission investigating the BP oil well explosion and spill in his detailed summary of the final report. The report had been submitted a month ago, but this subsequent report includes more detail.

Bartlit, said in a statement. "Poor decisions by management were the real cause."

In 20 years of tracking negative business news, the Institute for Crisis Management has found year after year that two-thirds of all organizational crises are what we call “smoldering” crises.

They start out small, usually internal, and in almost every case, someone or several someones should spot them and recognize their potential to grow into a major business disruption and ultimate crisis. And in most cases, they end up costing the company far more in the long-run than they would have spent to avoid or prevent the issue from getting out of hand and becoming a public embarrassment later.

According to the BP Commission report, there were signs of potential disaster as early as 2007.

Investigators found repeated signs of incompetence and carelessness and disregard of warning signs of both, over at least three years, before the well blew-up, collapsed into the Gulf and began spewing crude oil across the region.

All you have to do is create a work environment where everyone is paying attention to what is going on around them, and no one is afraid to speak up when they see a problem and tell someone who can do something about it.

That’s not hard to do.

Register Now and Save Money on ICM Crisis Training

2011-02-11T14:30:00.004-05:00

If you've been thinking about signing up for the two-day or three-day Institute for Crisis Management Certification Course, the next one is scheduled for May 10-11 and 12.

AND, if you register before the end of March, you will get a 15% discount on all three days of intense crisis communication and media spokesperson training. If you wait until April to register you will only get a 10% discount.

You can save $306 for the May Certification Course if you register before March 31st.

This offer is good for the first ten persons who sign-up for the May 10- 11 and 12th course. You may use the 15% discount on the two-day course, only on the one-day media training course, or on all three.

For details about the ICM Crisis Communication Certification Course go to http://www.crisisconsultant.com/certcourses_main.htm .

For a registration form contact Yvonne at yvonne@crisisconsultant.com .

What Were They Thinking?

2011-02-08T17:06:00.002-05:00

JP Morgan Chase has been accused of over-charging 4,000 active-duty military families’ mortgage interest rates, improperly foreclosing on at least 14 families and within weeks of this becoming public, Chase cancelled a program to defer student loan payments for active duty personnel.

A Marine Captain blew the whistle on Chase after they illegally over-charged him interest on his home mortgage after he went on active duty about five years ago. A long-standing federal law (http://www.military.com/benefits/legal-matters/scra/overview) requires banks to lower mortgage interest rates to 6% for active duty military men and women during times of war.

After a months long battle, Chase adjusted the interest rate and told the Captain he only had to pay the 6% interest rate. But after a year, the family started getting threatening collection calls at all hours of the day and night and Saturdays and Sundays.

The right hand at Chase had not told the left hand what it was doing.
Captain Jonathan Rowles hired a lawyer and sued Chase.

Then, two months ago, Chase cancelled the deferment of student loans for active duty soldiers and began insisting they pay up.

Army Private First Class Andrew Napoli is serving near Kandahar, and his wife tried to get Chase to reconsider the student loan deferment. She said they ignored her, so she called NBC News and then told Chase she had called a network television news department.

She says the next day Chase called with a change of heart. NBC quoted Chase spokesperson Kristin Lemkau as saying, “Upon review, we have decided to reinstitute the loan deferment for all active-duty service members who request it.”

Did you catch that little qualifier, “who request it.” Wonder how many who were formally notified their student loans were no longer deferred now know they can “request” it again?

Remember, we at the Institute for Crisis Management argue that two-thirds of all business crises could be prevented. This is certainly one of those “problems” Chase doesn’t need, with public attitudes about American banks and financial institutions already in the proverbial crapper.

Chase chief spokesperson Lemkau said, “We are deeply appreciative of those who fight to protect our country and Chase funds a number of programs that provide benefits to military personnel and veterans, and while any customer mistake is regrettable, we feel particularly badly about the mistakes we made here.”

She said Chase is returning about $2-million in refunds to military families and buying back and returning the 14 homes that were foreclosed on.

So what could Chase have done to prevent or minimize the damage?

First, when you are dealing with a potentially high profile customer – i.e. families of U.S. soldiers – stop and think about the ramifications of what you are about to do.

Second, when a potentially high profile customer – i.e. families of U.S. solders – asks for help and someone to listen to them, don’t even think about it. Put them in touch with someone who CAN help. If that is not your policy, more often than not, you can expect to read about the customer’s complaint in the local newspaper, on the local TV “Trouble-shooter” segment or somewhere among a million on-line blogs, tweets or other social media outlets.

A Lesson From Fort Hood

2011-02-04T11:50:00.002-05:00

You and your organization – business, non-profit, college, university, healthcare facility, manufacturing plant or distribution center – are not immune from workplace violence.

You can ignore the threat, continually tell yourself “it will never happen here,” and go about your daily business in ignorant bliss.

Or, you can learn from all those examples that face us in the news almost every day.

A federal government report, just released, confirms what every expert has been saying for years.

The murder of 13 people and wounding of 32 more at Fort Hood, Texas in November 2009, “could have been, and should have been prevented,” according to Sen. Joseph Lieberman, (I-Conn).

Marc McElhaney, Ph.D., an Atlanta based expert on workplace violence says workplace violence is a process, not a sudden event. Our experience at the Institute for Crisis Management supports that conclusion.

Just because the Senate report is about an attack on an Army base, doesn’t mean management of any other kind of organization can ignore the findings or convince themselves it could never happen in our plant, campus or office.

There are two things every executive, administrator or business owner should do.

1. Learn the signs of developing workplace violence and educate all employees about their responsibility to pay attention to signs of change and behavioral problems with coworkers, AND then to share that concern with the appropriate person.

2. Develop a workplace violence crisis plan for the rare occasion when you can’t prevent an incident.

You can learn more about or contact Dr. McElhaney and his staff at www.craorg.com for help with #1 above and the Institute for Crisis Management www.crisisconsultant.com or info@crisisconsultant.com for help with #2.

Disasters, Crises, Trouble Everywhere, Are YOU Prepared?

2011-02-03T14:20:00.001-05:00

A 5-Star hotel in China was destroyed by fire started by Lunar New Year fireworks. Egypt is the focus of the world. While protestors demonstrate, throw fire bombs and get shot at by alleged government thugs, businesses throughout Cairo are shuttered, looted, damaged or destroyed.

A factory explosion killed 7 in Turkey and a storm more powerful than Katrina slammed the coast of Australia.

That’s just a few of the headlines in the news in one-hour, one-day this week. Oh, by the way, did you hear about the snow and ice storm that paralyzed cities and businesses from St. Louis to Chicago to the Northeast United States?

Wonder how many of those businesses, hospitals, non-profits, colleges, universities, plants and distribution centers had a crisis plan?

All should have a crisis operations plan, a crisis communication plan and a continuity and recovery plan.

Office Depot has developed a guide, “Expecting the Unexpected; Disaster Preparedness for Small Business.” They commissioned a study by TNS NFO that found 71% of small businesses do not have a disaster plan and 64% of the owner/operators of those businesses say they do not need one.

According to the Association of Small Business Development Centers, more than one in four businesses will have a significant crisis. And the Hartford Insurance company says 43% of those who have a crisis and no crisis plan never reopen. And the Hartford study says of those that do reopen, only 29% are still operating two years later.

There are two things you can do, now, and we can help. Sign-up for one of our two or three day crisis communication workshops and give us a call about how we can help you develop a crisis plan.

We are accepting registrations for the May 10-11 & 12 ICM Crisis Communication Certification Course, and there are openings in the July 12-13 & 14 class and the Sept. 13-14 & 15 class. For more details go to http://crisisconsultant.com/certcourses_main.htm or call us at 502 587 0327.

What Can We Learn From The Latest Edelman Trust Barometer?

2011-01-27T12:30:00.004-05:00

There’s bad news and good news in this week’s 2011 Edelman Trust Barometer, reported by Richard Edelman.

Among the most unpleasant findings, Edelman says, in the 23 countries surveyed, the United States has moved into what he calls the “Distrusters” group among businesses. In fact, the Survey found business, for the most part, is “as or more” trusted than government in 19 of the 23 nations studied, with the exception of U.S. business and business in Russia and the United Kingdom.

And in the "Truster" category for government, the largest drop in trust in governments was reported in the United States and Germany. Trust in the media was also measured in the 23-countries and Richard Edelman wrote “the most depressing findings for media” was in the U.S. where only 27% of the public trusted the American media.

When it comes to trust in industries, banking and financial services are the least trusted industries of 16 reviewed each year by Edelman. Banking reputations plunged in the U.S. by nearly 50% in the past three years to a low of 25%.

The annual Edelman Survey found there are four major factors that determine corporate reputation. They include “high quality products and services,” being a “company I can trust,” being a company that “treats employees well,” and one that has “transparent business practices.”

One other area covered in the annual survey rated “credible” spokespersons for companies.

The reputation of American CEO’s was up in 2010, higher than it has been in nine years, but still only about one-third think an American CEO is believable.

Respondents were asked who they were most likely to believe as spokesperson for an organization and they rated Academic experts number one, company technical experts next, then financial analysts and Chief Executive Officers fourth.

Edelman‘s findings had one confusing and contradictory report – in a crisis, the “number one trusted source is the CEO, followed by an Outside Expert, followed by a Technical Expert from the company.” Go figure!

One of the most encouraging findings supports our strong belief that “banked good will” is invaluable to any organization facing trouble. The Edelman report concluded that an organization going into a crisis with a reputation of distrust only needs a couple of negative news stories to convince the public you’re no good.

The same study found that if you approach a crisis with a reputation of being a “trusted” company, it only takes a couple of positive stories to turn the tide in your favor.

Our conclusion continues to stress the importance of doing the right things for the right reasons, and treating your employees, partners, vendors, share-holders and customers the way you would want to be treated. Those are all ways to create and “bank” goodwill and goodwill can be a company life-saver when something goes wrong you could not prevent.

What Would You Do If Your CEO Took Unexpected Medical Leave?

2011-01-18T15:05:00.004-05:00

Will Steve Jobs return to Apple?

BusinessInsider.com (http://www.businessinsider.com/steve-jobs-email-to-apple-staff-is-not-encouraging-2011-1) is speculating he may not return to the job he says he loves, or at least not quickly.

In his e-mail to his staff a few days ago, he wrote, "I love Apple so much and hope to be back as soon as I can." Henry Blodget of BusinessInsider.com opines that "those are not the words of someone taking a short leave who is confident he will be back at the company soon (or ever).

When he took a medical leave before, he made it clear he was returning in "June" and he was looking forward to "seeing all of you this summer."

In any company, the sudden permanent or even temporary loss of a key executive can have devastating impact on the brand, and in the case of a publicly traded company, a serious hit on stock value.

If you do not have a crisis plan for the loss of your owner, founder, president, CEO or other significant leader, please reconsider. If you don't think its important, watch Apple very carefully over the next few months, and then decide if you still don't need a plan for the loss or incapacity of a key company leader.

It is rare when the Institute for Crisis Management helps an organization develop a crisis plan that there is no section on what to do and say when something unexpected happens to the top person or persons in the organzation. That's just as important in healthcare, higher education or major non-profits as it is in the corporate world.

Watch and Learn from Bank of America

2011-01-03T15:28:00.003-05:00

No matter what kind of business or organization you are part of, I strongly urge you to pay attention to what Bank of America is doing to prepare for possible revelations of damaging company information.

Julian Assange, the person behind WikiLeaks, threatened to release the contents of a hard-drive of a Bank of America executive months ago and more recently he sent shock waves through the banking industry with a threat to release confidential bank documents the first of this new year.

The New York Times is reporting that Bank of America has activated a special “counter espionage” and crisis management team in anticipation it will be the target of the next WikeLeaks attack.

The day after Assange made his most recent threat against an unnamed bank, Bank of America stock fell 3-percent.

The Times says their sources confirmed the company’s team of lawyers, security and computer experts, public relations staff and other experts have been reviewing thousands of documents looking for anything that might be used against the company, tracking every computer and hard drive looking for any that are or have been unaccounted for, for any length of time.

The best theory suggests if WikeLeaks has acquired any Bank of America documents, they were part of a federal investigation a year ago when the Bank turned over sensitive material to the Securities and Exchange Commission, federal investigators and the New York State Attorney General’s office.

Assange says he has documents that will lead to top level resignations. The SEC, federal investigators and the New York Attorney General all said they found no evidence of that kind of wrong-doing in the documents turned over to them.

The lesson here, for you and your business, is to know what is in your files – hard copy and digital files – and if there is evidence of internal problems, fix them, and be prepared to respond if and when they are made public by a disgruntled employee or some government agency.

Never assume that your organization’s secrets will always remain secret.

And don’t wait to be surprised and unprepared to respond when they are made public.

Better Listen To Your Customers

2010-12-31T10:47:00.002-05:00

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.

Two Certainties for the New Year!

2010-12-28T16:11:00.004-05:00

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 (http://redtape.msnbc.com/2010/12/ten-things-web-users-should-fear-in-2011.html) 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.

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

2010-12-21T15:15:00.004-05:00

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.

Are You Ready for the Two Cs?

2010-12-16T13:53:00.003-05:00

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!

Fire In Israel Is Lesson To Business Everywhere

2010-12-03T14:35:00.006-05:00

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.

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

2010-11-30T15:35:00.002-05:00

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?

Is Social Media In Your Crisis Plan?

2010-11-29T12:52:00.002-05:00

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 (http://crisisconsultant.com/certcourses_main.htm) as well as in custom crisis planning and training offered on-site to client organizations.

TSA's Pat Downs Create New Target for Terrorists

2010-11-23T14:54:00.004-05:00

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?

TSA Lessons For Your Business

2010-11-20T20:35:00.002-05:00

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.

Caught Between the Devil and the Deep Blue Sea

2010-11-09T11:33:00.004-05:00

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

2010-11-09T11:16:00.002-05:00

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.

Celery strikes again!

2010-11-03T14:33:00.002-04:00

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.

What were they thinking? Again!

2010-11-01T16:15:00.002-04:00

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.”

Thinkprogress.org, 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.”

Lessons from the Campaign Trail

2010-10-06T09:58:00.009-04:00

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.

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

2010-09-16T13:21:00.001-04:00

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.

On Second Thought, Hospital Did Not Handle Crisis Well

2010-09-05T15:13:00.007-04:00

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.

Not Getting The Cart Before The Horse

2010-08-19T10:12:00.005-04:00

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.

What Kind of Severance Package Do You Have?

2010-08-10T11:39:00.005-04:00

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.

Lesson from BP and Transocean

2010-08-05T11:24:00.006-04:00

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.

Final Thoughts on BP's Hayward, Hopefully!

2010-07-30T09:37:00.003-04:00

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.

Oops!

2010-07-21T19:06:00.002-04:00

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 piñata, 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.

What is the key to most disasters?

2010-07-19T14:48:00.004-04:00

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.

Do You Need a Social Media Policy?

2010-07-12T16:27:00.003-04:00

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.

You Knew It Was Gonna Happen

2010-07-06T09:48:00.003-04:00

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.

Does The Board Have A Role In Crisis Planning

2010-07-01T16:07:00.004-04:00

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.

McChrystal Had To Go

2010-06-23T16:34:00.004-04:00

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.

Annual ICM Crisis Report Released

2010-06-22T13:42:00.006-04:00

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: http://crisisexperts.com/CR_Signin.htm

How About A New BP Spokesperson?

2010-06-18T14:59:00.004-04:00

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.

Which Audience Is Most Important: Internal or External?

2010-06-16T16:59:00.004-04:00

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.

Tony Hayward: “Did I Say That?”

2010-06-03T12:21:00.003-04:00

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!

Suicides at Apple, Dell Suppliers in China

2010-05-29T16:16:00.004-04:00

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.

BP's Twitter Imposter

2010-05-25T09:54:00.004-04:00

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 http://crisisexperts.blogspot.com/ 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.

What Will Toyota Do With Its Polling Results?

2010-05-17T16:46:00.004-04:00

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.

Have You Tweeted BP Today?

2010-05-04T16:34:00.002-04:00

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: http://www.deepwaterhorizonresponse.com/go/site/2931/ 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.

How Is BP Doing?

2010-04-30T16:22:00.003-04:00

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.