Archive for March, 2010

Nestle, Greenpeace, social media, crisis management, facebook, YouTube, Twitter. PR measurement. Interested?

Prediction: we should see signs of Nestlé’s share price recovering from its latest issue within about 15 days.

Prediction 2: at some point this year, 2010 will be named the Year of the Social Media Crisis. So I’m doing it now just to be the first. (If I’m not the first then please let me know so I can link to that person’s blog and boost my traffic But it didn’t come up on Google today).

Last week Greenpeace kicked off the latest element of its ongoing campaign against the use of non-sustainable palm oil, lining up the cross hairs on Nestlé, and in particular the iconic Kit Kat.

What started out as a fairly run-of-the-mill campaign (Greenpeace has run similar palm oil campaigns in the past), took a bit of a turn when social media gurus jumped on Nestlé’s response to criticisms on the company’s facebook fan page. This was the point at which I started to pay a bit more attention as it was no longer just the Greenpeace campaign that was fuelling the issue (and thanks to fellow H&K blogger Matt Muir for flagging it to me on a Friday afternoon!). Interestingly, the official video in question still only has around 80,000 views on YouTube (sorry folks, one of those is mine).

The problem the company now faces is that the story of its engagement with stakeholders via social media has, as was probably expected by anyone with a facebook account, overtaken the original issue of its sourcing practices, as highlighted by this PR Week story.

Since there are 90,000-odd people out there all with an opinion on that, I’m going to leave that particular debate alone. I’m more interested in what’s happening with the company’s share price, which, as you’d probably expect, has taken a bit of a dip. (Hopefully on Monday our IT wizards – or Matt – can explain to me how I insert that as an actual image – to be updated…).Now updated with actual artwork.

While that’s not wonderful for the company’s shareholders, it’s useful as an in situ case study. As mentioned previously on this blog, good crisis management can have a remarkably positive impact on shareholder value.

The Knight & Pretty study on which that assertion is based shows that companies that recover well from a catastrophe tend to show the start of an upward trend returning to their share price around 10-15 trading days post-disaster (recoverers are the top line):

Figure 4 from Knight & Pretty's "The Impact of Catastrophes on Shareholder Value"

This recovery is largely attributed to the performance of company management in the early stages of the recovery. I think Nestle is the kind of company that will be able to manage its way out of this fairly promptly. However, there are some additional challenges the company will face in getting there (I think):

  1. Getting the facebook thing right will probably involve a bit of sword-falling. But that’s no good unless you mean it (which means there has to be some kind of behaviour change first, before the public perception piece will work).
  2. The marketing sub-set of social media guru-dom will continue to feast on its young, until more tech-savvy marketers take the point of view expressed by @mediaczar (thanks @Matt_Muir yet again). Great example of Twitter as a debate platform. In the meantime, watch the carnage continue.
  3. Institutional investors will remain all over the shop courtesy of having to work out how the economy works again after a global financial crisis. The upturn in value I think will be affected by just how much brokers and analysts value the impact of social media vs. the old fashioned kind.
  4. They’re still going to have to do something about the palm oil. Incidentally, so are thousands of other companies because it’s remarkably pervasive stuff – you wouldn’t believe how much of it’s out there, and ever since we all got scared of trans fats in our diet, palm oil’s been making a comeback in ingredient lists.
  5. Supply-chain scrutiny is going to return to the fore. We’ve not long ago finished Fairtrade Fortnight, when Kit Kats across the world were celebrated for the appearance of the new logo. The ease with which this issue has captured public opinion will, I think, galvanise a lot of other interest groups who have previously struggled with highlighting labour/sourcing/deforestation practices in the past, having another crack.

Time will tell if I manage to fluke at least one of these (or my two predictions). I have a feeling there’ll be a hat eaten at some point this year…

As an adjunct to all of the above, I think communicators/marketers/crisis managers and PR students should spend some time with a PR text book and the Greenpeace website.

Professionally I have a lot of time for the sophistication Greenpeace brings to its campaign activities, because they show all the hallmarks of strategic, issues-led communication campaigning. PR measurement isn’t rocket science (well, only rocket science is really)…point being, if you set your PR or communication objectives properly, measurement becomes a binary thing. Either you achieve your objective, or you don’t. Pretty simple stuff, and yet remarkably difficult to do well – usually because we get side-tracked by things like events, press clippings and “we want to do a viral video”.

What I should have said about crisis management at our change communication event (Part 3)

After last week’s change and communication event at Hill & Knowlton I’ve been following up an answer I gave to the question: ”What do you tell internal audiences about a change program, compared to what you tell external audiences?”

My answer at the time was: tell them both the same thing. So far we’ve looked at the consistency of message argument for this, and the information security one. Today I’m going to throw the social media hat into the ring.

There’s an inevitability about change that some people won’t like it. There’s an inevitability about things we don’t like…we complain about them. Years ago we’d get our mates together down the pub, or around for scone, or any of a million ways of having a conversation, and we’d all hang around and gripe about stuff until we felt better.

Now with the internet, we can get millions of people together for a gripe and we don’t have to buy any of them a beer. Brilliant!

The problem facing change managers then is this: if any of your audiences don’t like what you have to say (and if you make any staff redundant then you’ve already got on board this particular train), then that audience has everything it needs to wage war on your organisation. And rest assured, it’s in the best interest of certain stakeholders to take advantage of that change in mood.

Here are three ways that this has already happened (probably happening right now if you really want to go looking for it – the point is it’s not like I’m giving people new ideas for how to cause you trouble):

  • Facebook groups/fan pages to save something or boycott something. Local sporting facilities are a classic example. Easily set up by an anonymous administrator, easily shared because if you’re reading this then you’re probably sitting within two metres of someone who’s on facebook already. Unlike most blogs a facebook page doesn’t need a moderator, so even if something does get pulled down by an administrator it will have already been seen.
  • Please re-tweet [insert tweet here]. Doesn’t need to be anonymous to kick it off because if support swells then the last thing you have time to do is search for that first random tweet (note this is different to issues such as that experienced by Vodafone because the tweet in that instance came from its account). If you really want to put a rocket up this kind of action, you use the please re-tweet approach to gather fans for your facebook page.
  • Form letters. Boring I know – there’s no video, there’s no social networking, and you can’t check in from your iPhone. In fact, not really “social media” on their own, but definitely a bit of retro Web 2.0. Annoyingly though, the online form letter is brilliant for capturing the “oh, it’ll only take a second” protest because it’s made as easy as humanly possible for people to participate (just click here!). Rest assured, the online form letter is designed to position your detractor’s argument in the best possible light, positioning you with only one “appropriate” course of action – usually the opposite to what you’re going to do. We’ve had clients receive thousands of these for various reasons, and unfortunately the biggest problem we usually encounter is the complete absence of any opportunity to reply. If you were writing a letter yourself, you’d usually include a return address…not usually the case for online form letters.

Regardless of the form the protest takes, the consistent problem they all raise is that of consistency, i.e. the availability of the same information to stakeholders in different audiences. Which is the point we started at.

By ensuring that common information is made available to whomever wants it, you won’t necessarily avoid criticism entirely, but you’ll be able to address it. And usually correct misinformation.

In some instances, smart use of social media will actually enhance the objectives of the change program, but you have to get it right because the footprint you make will be there for ever. Rest assured, your detractors will get it right. The only defence you have is openness, transparency, and information.

What I should have said about crisis management at our change communication event (Part 2)

Yesterday I started to follow up a question from last week’s panel discussion about the relationship between organisational change and communication, in particular the idea that internal and external audiences should be given the same information.

In this post I’m going to expand on the idea of information security.

This particular issue came up in the case of an organisation undergoing some changes to its workforce (it’s fair that most of the world’s companies probably are at the minute, so timely…). The challenge presented was around the implementation of the change program – if, as per my contention, we’re supposed to tell everyone the same thing at the same time, how can we expect the changes to be implemented with minimal external disruption?

Good question, and having had a week to think about it, the exact answer I keep coming up with is…you can’t. To clarify, I think you should share the same central theme with your stakeholders throughout, contextualised to suit their needs. And broadly speaking you should try to communicate in as timely a fashion with each audience as possible.

That’s not to say tell everyone everything, all at once. Rather, if you have information that’s sensitive to the change program internally, and relevant to external audiences (e.g. customers or suppliers), then try to coordinate the information flow so that the right people get the right message at the right time. I like to think of it as giving people the information they need to do the job they need to do with it. Knowing what that information is…that’s the job of the change manager. Sorry.

This isn’t an issue of trust. It’s one of effective project management, and it’s one of balance. If you’re asking a team to implement something, and there’s a clearly defined process for them to follow, then they need as much information as it will take to achieve the outcome. If, however, you have an outcome but want the team to devise the implementation, then they need different information (and probably more freedom as well).

As Scott McKenzie often says: “Your employees are adults. Treat them like it.” I agree, but adults also get speeding fines, take documents out of buildings when they shouldn’t, email things home that they shouldn’t, have affairs, go to the pub, leave stuff on trains, have the occasional brain explosion…whatever it is, chances are it won’t be all that life-threatening. But if incorrect or incomplete information lands in the wrong hands, or the right hands at the wrong time, then a day-spoiling phone call won’t be far away. Shortly after that is when many organisations go from a well-intentioned change program to a call to our Issues & Crisis Management team (usually about half an hour after news crews have already lobbed on the doorstep).

I think it comes down to being sensible with what you share, when, and with whom. You’ll always have a knowledge gap between the change manager and their team, and the rest of the organisation and its stakeholders. By securing information until such time as the organisation’s ready for it to be released, you’re just helping to streamline the process. It’s a question of balance.

Tomorrow we’ll have a look at the social media ramifications of change programs in Part 3.

What I should have said about crisis management at our change communication event (Part 1)

It’s not unsual for Hill & Knowlton’s Head of Change & Internal Communcation, Scott McKenzie, to catch me on the hop, but he had a couple of good cracks last week at our panel discussion about the role of communication in managing organisational change.

One of the questions he hit me with last Wednesday night was around the issue of what do you tell internal audiences about a change program, compared to what you tell external audiences.

My answer at the time was: tell them both the same thing, because whatever you share internally will find its way out, and if you tell external audiences something you haven’t told your people then you’re in for all kinds of trouble.

In the post-event melee it was suggested to me that I hadn’t given enough credit to employees who know what constitutes commercially sensitive information. So, I feel I should expand on my response (not changing it mind!). There are three areas I want to address, which we’ll do in three parts:

  • Consistency of message
  • Information security
  • The inevitablility of social media

From an issues or crisis management perspective, change is usually something that one or more of your audiences will already perceive as a Very Bad Thing. This perception comes from the fact that different audiences have different needs, incentives, cares, problems etc. They’re all valid, but that doesn’t mean they’re all helpful.

This being the case, what I would see as the single most important consideration for communicating any major change would be to find the common ground that all (or as many as possible) of your audiences share. Usually, that’s the future health and success of the organisation as a whole.

By using this common ground as an anchor point for the rest of your messages, it’s easier for your various (and disparate) stakeholders to 1) understand how the change impacts them, and 2) understand (and possibly even appreciate) how the change impacts other stakeholders.

By extension, if those audiences can understand each other better, they’re likely to find more points of commonality. If those points of commonality are aligned with what’s good for the organisation, then this is obviously a Very Good Thing. That being the case, you want to create as many potential points for your audiences to connect on as possible – ergo, tell them all the same stuff.

In the yet-to-be-written Part 2 we’ll look at information security in more detail.

How regulators deal with a PR crisis: EFSA releases crisis simulation report

Food and beverage companies operating in Europe would do well to take a look at the European Food Safety Authority’s (EFSA) recently released crisis simulation exercise report. For a number of reasons.

First of all, it reinforces the importance of training when it comes to crisis management. A great process, and a motivated, action-oriented team are both essential, but the glue that holds it all together is an established training regimen that builds team competence. Football fans know there’s a huge difference between a champion team and a team of champions.

Secondly, if you’re in the food and drink business, it’s really important to understand how regulators are likely to react to your issue or crisis. Crisis communication reinforces the importance of well-managed stakeholder relationships, and if you have a significant enough crisis of your own, chances are you’ll be giving EFSA a call yourself. It’s a good idea to know how that’s going to go down. When our Issues & Crisis team runs simulations, we always take a broad view of stakeholders (it’s no good just worrying about media – you also need to think about government, or your social media audiences).

Thirdly, simulations are resource-intensive. While regular training and testing is important, it should also be incumbent on staff to maintain a minimum standard of self-education. Reviewing other organisations’ case studies and reports is one way of helping to achieve that. Even better, if you’re familiar with your stakeholders’ crisis management procedures then you’ll be in a better position to help them out should they need it. And helping people out of a bind is a great way of building your relationship with them.

Colourful quotes continued

Shortly after publishing this post yesterday on the importance spokespeople (and business leaders) communicating their personality, a friend sent me a link to a Harvard Business Review post, by Roberto Verganti, on a tenuously-related topic.

I particularly like this passage: “…visions are intrinsically ideological and biased towards a clear aspiration of how the world should be: They strongly reflect the personal culture of the thinker.”

For many spokespeople, managing the art of communicating their organisation’s key messages in the thrust and parry of a media interview is enough of a challenge to be going on with, thank you very much.

However, for those in true leadership positions, a bigger challenge is communicating Verganti’s idea of personal culture. If you’re a business leader then you were hired to manage a business (or you built it up yourself), so that’s a given. But if you want your people to follow you, you need to share your vision and show them you’re prepared to lead.

Courageous, colourful quotes get you noticed, and probably knighted

“Those with the strongest views that the price of Australian houses “must” fall typically either don’t own one, don’t really know what they are talking about, or both.” – Rory Robertson, Macquarie Bank interest rate strategist

The above quote ran in this column by Michael Pascoe today. Perhaps its because my introduction to the British economy came courtesy of Robert Peston’s book, Who Runs Britain?, but from an outsider’s perspective I’d have to say that there’s a dearth of colourful spokespeople in the market. However, when I thought for five seconds about which British individuals I could imagine using a line like this, three names came to mind:

  • Sir Richard Branson
  • Sir Phillip Green
  • Sir Stuart Rose

And aside from wealth and knighthoods, that’s something the three individuals listed above all have in spades. Personality.

For business managers, PR people and spokespeople generally, this is brilliant news, because it means that if you’re prepared to say something colourful, the chances are you’ll get noticed.

The problem is, you can’t rely on media training alone to give you the colourful quotes. These have to be a reflection of your own personality. Media training, or presentation skills training, or even night classes in interpretive dance will help you to express that personality in a way that’s right for your audience.

At the end of the day though, that expression comes down to having the courage to share a bit of yourself with the rest of the world.