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Crisis Communication

Crisis Communication
June 22
07:01 2016

Crisis Communication Explained

Crisis communication, in public relations, can be defined as the need for organizations to repair damaged images after a crisis or disaster (Benoit, 1995; Coombs, 1999). In other words, the steps taken by a company to mitigate or limit any reputational harm caused during a crisis. Effective communication during a crisis will help in containing it whereas flawed communication might end up amplifying the actual crisis.

According to experts, the type of crisis, organizational history of the company, and the specific dynamics of the crisis are crucial determinants in planning the necessary strategy and approach (Coombs, 1999; Seeger, Sellnow, & Ulmer, 2003). There is consensus that the ultimate goal of Crisis Communication is the reduction of harm. The need for an effective Corporate Communication plan is crucial for the existence of companies because building a credible corporate reputation is a very challenging task. At the same time, it doesn’t take much time for a company to lose its credibility in the face of a crisis largely owing to the fact that a company in crisis becomes the epicentre of media attention.

The term Crisis Communication entered our daily discourse largely owing to the 1982 and 1986 Chicago Tylenol crisis the Johnson & Johnson Company was faced with. Though it remains a classic example of how the company withstood a crisis under strict scrutiny by media and public agencies through effective communication, the last decade and more specifically the last five years, witnessed the unprecedented growth and pervasiveness of social media; which has radically transformed the communication landscape and communication systems. In order to effectively handle the crisis situation, it is integral to harness the power of the social media by incorporating it into each stage of communication. So we need explore case studies with social media playing the lead role.

Crisis-Definition

Crisis can be defined as the perception of an unplanned incident or an incident of flawed planning with the potential to jeopardize a company’s image as well as performance, hurt the sentiments of its stakeholders and influence the public perception regarding the company generating negative outcomes. It poses a threat to both organizational reputation as well as the relationship between the organization and its stakeholders.

Gerald Meyers identifies nine types of crises: (1) public perception, (2) sudden market shift, (3) product failure, (4) top management succession, (5) cash flow problems, (6) industrial relations, (7) hostile takeover, (8) adverse international events, (9) regulation and deregulation. Crisis could include ‘‘natural disasters’’ (tsunamis, earthquakes , and wild fires), industrial accidents (spills, explosions, and product), and intentional events (workplace violence, product tampering, and terrorist attacks) as well as a variety of other kinds of harm-inducing occurrences (Seeger et al.,2003) that can cause physical (people &infrastructure), financial, reputational harm to an organization or its stakeholders or both.

A crisis may or may not be attributed to the negligence of a company. However, if the company fails to tactfully address the issue quickly and employ a fail proof contingency plan that subsumes a strategic crisis communication plan and a media strategy, things can drastically spiral out of control of the organization even if the company is out of blame. Therefore, it is rightfully said that Crisis Communication is the life force of crisis management and constant media monitoring is vital for maintaining organizational reputation and health. Knowing the kind of crisis will enable managers to take better informed decisions on how to tackle the crisis.

In the modern world, companies have to plan ahead to face the unthinkable anytime, although theoretically, let us consider a three stage approach recommended by many crisis management experts which includes: (1) the pre-crisis stage (2) the crisis (3) the post-crisis phase (Coombs, 2011). The crisis management team will have to tackle each stage differently despite effective Crisis Communication being an ongoing-continuous process.

Crisis- The three-stage approach (Coombs, 2011)

Let us analyse the crisis management process through a comprehensive three-stage approach illustrated by Coombs (2011).

The first stage or the pre-crisis stage includes the basic precautions an organization has to take before it encounters a crisis. Though it is impossible to consider and plan ahead for every kind of crisis scenario, it is advisable to be prepared and be on the alert for possible warning signs. This stage involves the identification and prioritization of vulnerabilities, selecting a crisis team and a trained spokesperson, drafting Crisis Management Plans (CMP) etc. It also becomes imperative for the companies to have an oversight of the key players in the industry as well as befriend the media as they are likely to capitalize on the situation; if a company is faced with crisis.

The second stage includes crisis recognition and crisis containment. This entails identifying the crisis as well as the means and ways to recover from it. Communicating with stakeholders or stakeholder engagement becomes an important aspect for recovery.

The post-crisis stage entails what needs to be done after the crisis has been resolved and ways to avoid similar issues in the future. The activities in the resolution phase should include codifying and adhering to the lessons learned from the crisis and efforts for rebuilding strained relationships.

Let us consider a recent example which encompasses the current social media landscape and the way which we, as a society respond to a crisis in a highly speculative, fast-paced media environment. So let us explore the topic of Crisis Communication under the purview of Costa Concordia ship disaster of 2013 wherein the lack of an effective crisis communication strategy proved extremely problematic for the organization as a whole, leading to reputational harm.

Carnival Corporation is the world’s largest cruise ship operator and is a British- American global cruise company with over 85,000 employees and Costa Cruises Group is one of the main operating companies in the Carnival group, with the executive control of the group’s activities in Europe. The Costa Concordia capsized off the Tuscan island of Giglio on Jan. 13 after the ship detoured from its programmed route and slammed into a reef. It left 32 people dead and this incident is said to be one of the greatest maritime disasters of all time. The company has been heavily criticized by the media and other sceptics for its inaction, the delay in deploying safety measures, lack of preparedness and callousness towards the passengers by failing to offer negotiable, reasonable compensation for the physical and emotional trauma that they endured and most importantly the failure to communicate to its stake holders with clarity during the time of crisis. The incident has severely damaged the company’s reputation, credibility and people’s trust in the company and is a perfect case study for crisis communication.

Let us explore the good practices in Crisis Communication keeping in mind the lessons learnt from the Costa Concordia crisis:

Be prepared: Crises are unpredictable but not unexpected (Coombs, 2011). Integrated Crisis Communication plans have to be in place for sudden disasters owing to earthquakes, accidental fires, terrorism etc. that could strike anytime. Identification and prioritization of vulnerabilities can help a company anticipate the potential risks and to a great extent prevent the crisis the company is likely to encounter. An obvious example would be that of companies in the aviation business which can be confronted with safety and security concerns anytime.

Due to the uncertain, inherently dynamic and unpredictable nature of many crises, the traditional notions of planning, testing and execution, may not hold much significance. Routine procedures, therefore, may not apply to crisis situations. However, it is only reasonable to assume that to a large extent many risks can be foreseen and their impact on organizations can be reduced to a great extent. According to David Weiner, the Senior Partner at National Public Relations,

….. the vast majority of crises arise when companies fail to identify a potentially contentious issue at an earlier, more benign stage and to develop a plan of action to manage the issue before the issue manages them.

New York City Mayor, Rudi Giulani, was greatly praised for his leadership during 9/11 terrorists attacks which he duly credits to the crisis communications strategy that his team had in place much before the crisis occurred.

Respond immediately to the crisis: The Costa Group was heavily criticised for delaying the dissemination of information regarding the incident. The basic prerequisite of a fail proof crisis communication strategy is to communicate with its stake holders, the media and the public as soon as possible. In the case of the Costa Group, the silence from the part of the company became the primary reason as to why malicious stories about the company cropped up everywhere.

It is even more important to communicate during the early hours of a crisis because it further sets the tone for the rest of the communication. When stories propagated through both traditional and modern media reach the stakeholders it immediately spreads like wildfire through social media networks and word-of mouth; which can directly influence the public perception about the brand. This calls for authentic, formal information, disseminated by the company to curtail the flow of potentially harmful information that could permanently damage the brand name.

Generating trust through strong leadership and honesty: Every organization has to successfully defend its credibility and trustworthiness in times of crisis as the media, the key stakeholders and the public tend to be very cynical towards it.  Trust is engendered through the clarity and consistency of communication with the key stakeholders using different forms of media for the purpose. A company in crisis needs to employ a strong, trained spokesperson to communicate factual information of the incident through press conferences, media interviews and press releases. There is only need to give out information about what the company is certain of and not disputable facts, after a thorough investigation of the incident has been conducted. Centralization of information will eventually limit the spread of malicious news.

It is equally important to communicate with honesty, candour and transparency for creating a lasting impression in the minds of the audience. Sir Richard Branson’s (Virgin) and John Armitt’s (Network Rail) press conference after the Grayrigg rail disaster of 2007 is a classic example of commendable leadership that helped in settling a crisis and putting people’s concern at ease.

Have a media strategy: Media is a double edged sword and has the power to shape people’s perception regarding an organization (McCombs, 2003). It will be absolutely disastrous for a company to undermine the role of the media during crisis and at the same time if used with caution, media can be the ideal conduit for spreading favourable messages about a company to the world, during the time of crisis.

Because people rely on media for information, news stories become successful framing devices especially during the time of crisis. The more time and space the media devotes to a particular issue, the more relevant it becomes in the minds of its audience as elucidated by the research of Carroll and McCombs (2003). As both traditional and social media are on the prowl for newsworthy, sensational stories or even possible controversies that could affect the life of an individual or an organisation, it becomes absolutely mandatory for organisations to employ all forms available media to garner and maintain the trust of its various stakeholders, especially in times of crisis. With the ever increasing trend of reckless sensationalism which is fuelled by the media, creates undesirable outcomes for companies especially in scenarios where the company itself has no control over the situation.

In 2012, Pepsi encountered an interesting crisis that went viral on the internet though the allegation was originally made in 2009 by an Illinois man, Ronald Ball, claiming that his can of Mountain Dew contained a dead mouse. The Pepsi Co.’s attorney’s counter argument went on to become the butt of all jokes as well as a statement of grave health concern when he refuted the allegation by stating that  the mouse “would have dissolved (and become a jelly-like substance) long before Ball ever had the chance to drink it.” Now comparisons of Mountain Dew to battery acid are strewn all over the internet.

If a company remains silent during a crisis, the media will take the liberty to scoop out even more scandalous or even illegitimate information about the company and the incident thereby increasing the reputational harm. Therefore the smoke screen surrounding the incident has to be removed by the company itself and therefore important to have a media strategy in place that will resonate a unified message from the company.

Take responsibility and apologize: Accountability of action is an important factor in the establishment of trust. When at fault, a company has to take responsibility and should express genuine concern about what happened. A public apology of such content will voice the company’s efforts at transparency in actions, responsibility towards its clients, concern over their safety and commitment to ensuring that the same mistake will not happen again. For undoing the reputational harm a company is faced with, taking onus of the crisis to portray that safety is at the heart of concern for the organization, especially if the incident involved a threat to the human lives.

In 2011, Johnson and Johnson’s popular OB brand of tampons started disappearing from store shelves that left its loyal fan following enraged. Though it maintained silence about the disappearance of the tampons despite the public outrage on social media, it responded to the crisis with an innovative response in the form of a music video that personally apologized to its customers with a promise to bring back the product.

Taking responsibility does not imply taking undue blame but denying all knowledge of the same can possibly have undesirable consequences. A company can assign

independent, non-partisan bodies to investigate the accident which can be made available to all its stake holders through media. The detailed investigation report can be published in the company’s website or even sent out to its various stakeholders especially its major clients, shareholders, employers, families of the victims etc.

Stakeholder engagement: A company has to proactively engage with all its stakeholders using all forms of available media. Here equal importance has to be attributed to strengthening both internal and external communication strategies without underestimating either of the two. The emphasis here is again on gaining the trust from the employees, shareholders as well as other stakeholders including its clients and the general public. Bravely engaging with the stakeholders, addressing the current and potential issues will not only give a deeper understanding of public opinion and problematic areas but will  also help in building a corporate image that is both transparent and responsible and in turn will help with the long term sustainability   and growth of the company.  This can be achieved by forming a committee or a stake holder dialogue forum where different stake holders can voice their opinions and share their views which would serve as a platform for engaging with the internal audience and the general audience. The open discussions, criticism and debates on ethics which come out from the forum will help in revaluating the values of the organization as well as the expectations of the stakeholders and in taking decisions for the future.  The detailed reports or newsletters of such meetings will be given out to the stake holders through media highlighting the main points that have come out during the discussion. Face to face interactions with stakeholders need to be complemented with mediated communication to ascertain them.

Recognize the dynamics of social media: The impact of social media on public opinion and public opinion formation is greater than ever before. The messages shared through social networks can build or ruin organizational reputation within minutes after the first message makes its appearance.

In 2009, a YouTube video went viral that contained images of two employees of Domino’s Pizza engaging in a number of rather disturbing, offensive activities that violated the public health law in United States and was viewed by millions of people across the globe. This was a potential nightmare for every company in the food industry and Domino’s Pizza was put in an awkward spotlight thanks to social media. As a result the company had to take immediate measures to counter the negative responses, rebuild the brand image and regain the trust of its customers via Twitter responses and an apology on YouTube by the President of the company. Twitter, Facebook and such widely popular social media websites could be used for the purpose. The social media can be effectively employed to create a lasting positive image of the organization and to create favourable opinion among the general public especially about the company’s adherence to its ethics and Corporate Social Responsibility.

The Costa Concordia ship wreck had cast a shadow on the entire cruise ship industry. Drawing inference from the Costa Concordia example, we can conclude that a company in crisis needs to be very proactive, constantly engaging and communicating with its stake holders with clarity and transparency, using multiple platforms. This in turn, significantly contributes to the establishment of trust between the company and its stake holders for rebuilding its corporate reputation.

(Copyright 2016 Anju Lopez. All rights reserved worldwide. Kindly contact the author for the licence to use parts or the entire article for commercial or non commercial purposes)

 

References:

Benoit, W. L. (1995).Accounts, excuses and apologies: A theory of image restoration. Albany, NY: State University of New York Press.

Carroll, C.E. and McCombs, M. (2003). Agenda- setting effects of the business news of the public’s images and opinions about major corporations. Corporate Reputation Review, 6(1), 36-46.

Coombs, W. T. (2011). Ongoing crisis communication: Planning, managing, and responding. Sage Publications.

Romenti, S. (2010). Reputation and stakeholder engagement: an Italian case study. Journal of Communication Management14(4), 306-318.

Seeger, M. W., Sellnow, T. L., & Ulmer, R. R. (2003). Communication and organizational crisis. Westport, CT: Quorum Press.

 

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Anju Lopez

Anju Lopez

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