Archive for the ‘issues management’ Category

Preparing for a crisis: webinar presentation now posted

Yesterday I had the privilege of speaking as part of Communicate magazine’s first Shouting With a Whisper webinars, on the topic of crisis preparedness.

For the next few months you’ll be able to view the webinar on demand. Or, if you just want to skim through a half-dozen slides on my bit you can view it below or on Slideshare.

Five lessons for crisis managers – as taught by faux pas on the Election trail

In case anyone has been hiding behind the sofa in recent days, or indeed is currently residing outside the UK, then you may not be aware that it’s General Election season here. This means the next four weeks will see wall-to-wall media coverage of a small group (mostly men) talking to several other groups (mostly disillusioned voters) about the economy, healthcare, education and the ever unpopular expenses scandal.

This level of media exposure is something that most companies can only dream of. However, this exposure also presents a constant challenge for the political parties and their staff to maintain the 3 As for their key spokespeople: Appearance, Appeal and Ability to communicate.

The 3 As are particularly difficult for politicians on the campaign trail because, unlike the comfort of a broadcast studio, they’re at the mercy of the general public with whom they are interacting. Already in the past week we’ve seen two incidents which highlight the reputational problems this can present.

Firstly, on the day after the Election was announced, Gordon Brown encountered his first ‘heckler’ on the campaign trail. Brown chose to ignore his repeated questioning, instead heading for the sanctity of his ministerial car. Unfortunately the cameras caught the whole episode, and within hours the video was on the net and in the evening news bulletins. Cue the notion that the Prime Minister only listens when he wants to.

Then, it was the turn of the Conservatives to encounter public anger. When their home affairs spokesman, Chris Grayling, made some unfortunate comments about homosexual rights, the party was bound to encounter the wrath of gay and lesbian rights campaigners. What they perhaps didn’t foresee though was a demonstration outside party headquarters, swiftly organised via Facebook. Again, cue the cameras and subsequent reports on the evening news bulletins and next day’s papers.

In this second case though, the Conservatives at least made several of the right moves before and during the protest – they engaged with the protestors during the demonstration and also held meetings away from it with the protest leaders to discuss the issue.

Companies are often left with having to face and contain similar kinds of protests following job losses, poorly received pay negotiations or other unpopular decisions. There are no hard rules on controlling these situations to ensure a successful outcome. Nor are there any quick fixes or guarantees to avoid less than favourable media coverage of the event for your organisation.

What there are though are some good basics that can be done:

1. Dialogue – have meetings been arranged to try to prevent the demonstration or at least resolve the issues behind it? Will any senior company figures be available to listen to the concerns of the protestors on the day?

2. Briefing the staff - does everyone know about the demonstration? Do they know how to respond if/when they’re quizzed by media or protestors? Have you prepared Q&A documents, media statements etc for quick deployment?

3. Security – what measures and procedures do you have in place if things turn ugly?

4. Preparation – above all, have you anticipated and planned for this kind of event happening? If you have, great, but then ask yourself if you’ve tested or simulated such an event to see if you can really pull it off under pressure? If not, it might be time to think about doing this.

5. Future proofing – and finally, what have you done and what still needs doing to prevent the issues that lead to these kind of demonstrations in the first place?

Recession recovery poses crisis management risks for industry

On the weekend I wrote a post for our new Energy & Industrials team blog, titled Habitual behaviours force shippers and miners into crisis management mode.

The basis for the post was the correlation between:

 “…two seemingly unconnected events…25 people were killed in a West Virgina mine exposion [and] a Chinese coal carrier ran aground on the Great Barrier Reef…I say ’seemingly unconnected’ because geographically the two events are about as far apart as you get. The respective industries are also unrelated…”

The connection is actually in the habitual behaviours performed by the respective companies, and to learn more about those you should click on the link above and read the original post.

What I’m more interested in here is a quick look at the sheer volume of corporate crises that we’re seeing in 2010. At least four major car makers (Toyota, GM, Honda, Nissan) have had multi-market product recalls. At least two major consumer brands (Nestlé, Unilever) have had issues with palm oil. I’m not even going to touch anything that’s been specifically labelled as a “social media crisis” in this list of examples.

Looking at all of these, the common link is still habitual behaviours. Whether it’s cutting corners on safety or engineering standards, taking short-cuts on voyages to speed up transit times, weakening the supply chain by creating untenable bottle-necks or driving suppliers down to almost margin-less prices, or other unsustainable corporate behaviours…none of these things are “one-offs”. They are all tried and tested behaviours that have become ingrained in an organisation’s culture.

When the global financial crisis hit, many of my clients assumed I was run off my feet with crises. The opposite was true. One or two disasters in a recessionary environment will have a much greater impact on business managers than they would do in the good times. (RM, if you’re reading this, I was still busy!)

In the past 18 months we first saw a deluge of stories about banks’ risk managers being ignored, followed by story after story about careers in risk management being the new black. When the economy is in meltdown and your business is more exposed than ever before, you pull all the stops out to ensure crises just don’t happen. When the revenue tap gets turned back to a trickle, you cut “non-essential” operations – those pesky things like marketing budgets (where’s my ROI???), crisis training (why are we doing this if we haven’t had a crisis in three years???), media monitoring (we’ve cut our marketing, we don’t need to pay for media clips???).

Which is why we now have problems.

After 18 months of hyper-sensitive operational behaviour I think companies have forgotten what it’s like to have to deal with a crisis. Regardless of the growth in social media over the same time, the fundamental principles of good crisis management haven’t changed, but it seems the effective execution of those principles has gathered enough dust to make a real difference. This has been compounded by those bad habits being repeated faster, on a bigger scale, as companies try to trade their way back to the heady days of 2007.

There’s not actually any reason why so many of the high-profile crises of the past six months should have made the headlines to the extent they did.

I expect we’ll see still more high-profile crises rolling out before the end of the year. It should be a good year for crisis management consultants, because for every company in crisis today there are usually three or four who were lucky it wasn’t them. But that’s not good news for shareholders.

Supply chain is your business’s Achilles Heel

Last week I attended the latest Dow Jones Expert Series seminar, and at this point I’m about to lose 90 percent of the visitors who just clicked through from Twitter, because I’m not going to bang on about social media.

When it comes to being in business, your success or failure depends more than anything else on your ability to actually do business. That means having something that a customer wants, and being able to sell that thing at a profit.

If for any reason you’re unable to do that, you have a problem. Assuming for the minute that you have a market that’s happy to pay your price, it’s your “thing” that becomes all important.

Enter the supply chain. Whether you’re making chocolate bars, cosmetics, cars or fighter planes, chances are you have multiple suppliers all providing you with different ingredients or components. If you’re an international business, odds-on that you have international suppliers. And if you’re cost-conscious, I’ll put another each-way bet on the fact at least part of your supply chain is based in Eastern Europe, Africa, Central or South America, or Asia.

Right about now you should be starting to get a little bit squirmy as you realise the exposure your business has to events outside of your control. If not, here’s a tip: civil unrest, terrorism, despotic regimes, earthquakes, floods, tsunamis. Here’s another you may be increasingly familiar with. Ethical sourcing.

Interestingly though, these aren’t your most likely sources of supply chain disruption.

According to Dr Brian Squire from Manchester Business School, around 88 percent of publicly reported supply chain disruptions between 2000 – 2009 were due to human influences. Think user error, industrial dispute, cyber crime, corporate sabotage, ordering the wrong widget…

Even more interesting (I think) is that 40 percent of those were classifiable as “deliberate”. When I say “interesting”, what I really mean is “pretty bloody disturbing”.

I was really impressed with Nick Wildgoose, Global Supply Chain Product Manager, Zurich Financial Services, who also spoke at the event and provided some best-practice insights into identifying, managing and mitigating risks in the supply chain. Here are a few pointers that should be considered when you next review your organisation’s crisis management planning:

  • Is our supply chain likely to be impacted by natural diaster, such as pandemic or earthquake? (Tip: if you’re making stuff in China…yes)
  • Is our supply chain exposed to any single-source issues? (Tip: if you’re sourcing anything from only one supplier at any point, then yes. This is part of the issue with the glut of automotive recalls in 2010)
  • Do we, or any of our suppliers, have issues with trade unions? (Tip: if you have a unionised workforce and you’re in a manufacturing business then…probably)
  • Are we happy with our own, and our suppliers’, business continuity planning? (Tip: you probably shouldn’t be if Zurich’s statistics were anything to go by)
  • Do we have multiple points of contact with our key suppliers, or is our relationship purely transactional? (Tip: if your business is dependent on the survival and performance of another business, it’s probably a good idea to have multiple relationships with that business)

We’ll endeavour to add some further detail to this topic in the coming weeks, but as a starting point I’d strongly suggest asking the hard questions sooner rather than later.

Plug alert: Manchester Business School is conducting further research into supply chain risk and resilience. Please contact Dr Brian Squire if your organisation would be willing to take part.

Forget your social media strategy, how’s your business continuity plan looking? Five tips to help with next week’s rail strike.

Our UK readers are in for a particularly nasty headache next week, with members of the RMT and TSSA unions set to take strike action. Happily, the BBC saw fit to do away with the vitriole and publish this quick overview of the story.

If you want to read a different version that engages in a bit of union-bashing then Google News very kindly returns another 500 or so stories with varying degrees of that.

Now, I have a confession to make. I quite enjoy a good strike action, because it’s a manufactured scenario that mimics some of the conditions of a significantly nastier disaster. Except without the consequences that usually arise as a result of burning things to the ground, flooding them, or opening up a big hole in the Earth.

The conditions I’m talking about are things like:

  • Cutting your workers off from their place of business (pandemic, natural disaster, terrorist attack)
  • Cutting your business off from its workforce (pandemic, natural disaster, terrorist attack…sensing a theme?)
  • Cutting your business off from its supply chain (and we’re going to look at supply chains in a lot more detail over the coming weeks)
  • Cutting your business off from its customers

These kinds of things are all business-criticial. Social media, as I alluded in the headline, is not. In fact, the greatest irony in this scenario is that your social media gurus can probably do their job just as effectively at home, or on their mobile phone. Unfortunately…they’re not the ones making stuff, packing stuff, loading stuff onto various forms of transport, etc etc. Annoying.

Fortunately, a number of workers will be on holidays next week, taking advantage of the Easter long weekend to get a few extra days out of their leave, so that will help the congestion somewhat. But for the rest of us….ugh.

So, here are a few tips (five, since my headline commits me to it) to help triage your business continuity issues (in the event that you’re not already enacting your business continuity plan:

  • Reschedule meetings (or substitute face-to-face meetings with conference calls). Most companies have conference call facilities tucked away somewhere in the organisational brains trust. Dig your dial-in details out and circulate as necessary.
  • Establish an emergency working-from-home roster. If you need X number of people onsite, in your building, then that’s fine, but if some of your team can work remotely then now’s a really good time to encourage that.
  • Get your files in order. This might involve a special request to IT, as many companies don’t allow commercially sensitive information to leave the building (or to be sent to hotmail accounts!). Make sure you have all the things you need to work remotely (case in point, I’m travelling this week and forgot to take the document I was travelling specifically to work on. Yes, I’m daft, but fortunately a colleague was available to email me a copy, along with some thoughtful words)
  • Now’s the time to work out how to divert your landline to your mobile. Or to access your voicemail remotely. If you’re a team of 10 and only two people make it in to the office next week, then having them answer phones and retrieve messages (or forgotten files) is about the biggest waste of their time imaginable.
  • (Recycled) paper is the new black. The thing with business continuity is…it’s not normally one thing that brings you down. So if you’ve done everything above then that’s great, but what if the strike prevents your IT support people being able to get to work? And then, what if you have a server crash? And then, what if you need something urgently, something that you thought you had immediate access to, but now don’t, and the customer’s on the phone, media are calling and the police just knocked on your door…? Ah. Annoying. So here’s tip number five: print out the really important stuff.

At the end of the day, if you do find yourself stuck at home, connected to the internet and wondering when you’ll be able to get back on a train…there’s always facebook.

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.

Twitter terror: why business managers should be afraid of social media

In the past I’ve been rightly accused of getting a bit wordy on here with some of our more analytical posts, so today we’re going to try something a bit different.

Here’s a proposition I want to test before I do something as stupid as say it in public, and we’d welcome your feedback.

There are two reasons why business managers should be afraid of social media. Only two. Here they are:

  1. You are doing something you shouldn’t be, and people will find out.
  2. You are not doing something you should be, and people will find out.

The only caveat I’m going to put on the above is that what you “should be” or “shouldn’t be” doing is of course open to interpretation. But then, that’s why you have a PR department…

Thoughts, criticisms and opinions all welcome, but please try to stay on topic.