InfluenceChronicles.com -- Most of the world’s ten million crisis communications experts have weighed in on how United Airlines should have handled one of the most avoidably self-afflicted corporate public relations disasters ever.
United has learned an important lesson: That the company’s goal to “make every flight a positive experience” does not include dragging bloodied, screaming customers away from the product. For the rest of us, here are four essential truths about PR crisis that United’s ignominy should help every executive keep in mind:
1. A bad news event most often becomes a PR disaster because the company bungles its initial public response.
Coming out the gate, United Airlines CEO Oscar Munoz threw gasoline on an already raging fire by apologizing “for having to re-accommodate these passengers” -- ignoring that millions of people around the world were watching with jaw-dropping outrage the phone videos of Chicago airport security men violently dragging the non-violent, 69-year-old Dr. Dao down the aisle while other shocked passengers screamed to stop.
And just like that, an inexcusable but isolated, maybe even containable incident of barbarity by a third party becomes United’s global PR fiasco.
Consider how things might have played out if United's leader had instead come out seething with the same fury, demanding immediate answers as if it had been his own father dragged down the aisle, breaking his nose and knocking out teeth.
United's first response epitomizes a reputation risk that exists at many good companies, the ones that engage their publics as stakeholders. Yet in the first hours after a bad news event, many of those same companies suddenly treat their stakeholders as liabilities -- threats to be mitigated by dancing around the issue with words that say nothing and admit even less.
This is where a company's PR problem mostly likely becomes it's PR crisis.
In this era of hyper-transparency and real-time information, stakeholders aren’t spectators to how your company responds to negative events. They’re participants. Treating them like anything less is a sure-fire way to make the PR problem worse at the cost of losing their trust.
2. The cost of a PR crisis is ultimately determined by your company’s readiness to respond to situations that nobody saw coming.
Being the third-largest airline in the world, United Airlines has at its beck and call a global army of crisis-savvy experts in law, risk, reputation management and strategic communications. That the company shot itself in the foot so quickly and severely underscores how difficult it can be to manage PR emergencies in real time.
Consider your own company’s preparedness: Does leadership include loss of reputation value as a strategic risk consideration? How would you organize, vet the situation and communicate under extreme duress? Can the company be empathetic toward victims of the bad news events and the public’s reaction to them?
The less certain you are of how your company would navigate a similarly intense and fast-moving bad news situation, the more likely that things are going to get real bad, real fast.
3. The brand is responsible for the bad behavior of its beholders
Consumer brands usually take most of the negative PR for the bad behavior of downstream support companies. This is partly a matter of who has the deepest pockets to pay a possible settlement. But when the company escalates public outrage as United did with its dismissive first statement, the brand’s perceived top-down culpability expands to include all aspects of the negative situation.
While it was the United crew that called them in, it was Chicago airport security that violently dragged a paid, boarded and seated passenger off the plane. Yet Dr. Dao’s lawyers are making clear that they intend to vilify United, promoting their client as the “poster child” for how the airline industry mistreats its customers.
“Are we just going to continue to be treated like cattle?” Dr. Dao’s lawyer asked, saying he’s been “deluged with hundreds tales of woe, of mistreatment” and that “for a long time, airlines — United in particular — have bullied us.”
Consider how quickly this kind of disparaging attack could be made against your company, singularly or as the face of your industry.
4. Corporate PR crisis is a spectator sport, often disproportional to whatever event started it all.
In his 2014 book, Glass Jaw, Eric Dezenhall calls out the entrenched “crisis creation industry” of vested interests, information leakers, publicity mongers, competing news networks and click-hungry media sites – all working to exploit the advantages and failures of the internet age.
The result: An over-amplified, distorted echo-chamber where some idiot’s sexist tweet from a small company nobody’s heard of is reported on CNN International, and United’s seemingly dismissive response to the Chicago incident slashes more than $1 billion from the company’s market value in the span of a day or two.
True, the potential negative impact of any corporate crisis is often mitigated by the next day's fresh scandals and controversies. But protagonists know to push out new information, revelations and allegations to keep their issues active in the court of public opinion. Meanwhile, the company must deal with the real-world fallout of its PR crisis: investigations, lawsuits, recruiting challenges, customer concerns and other costly byproducts. For many small or mid-size companies, what happens behind a PR crisis is as devastating as the public view.
Which is why it’s so important to be prepared for whatever might be from around the corner.
Friday TakeAways is a weekly feature of the Influence Chronicles Blog from SilversJacobson, LLC, a corporate reputation and crisis management consultancy based in Denver and Washington, D.C.
InfluenceChronicles.com -- At one of our crisis communications workshops, a general counsel said his company would use a strategy of ignoring reporters to delay or kill a negative story. It's best to ignore news media until all the facts are known, or until there's some “good news” to tell.
But this works only if your company is Boss of Everyone. If it isn't, then you can’t stop media from reporting a legitimate news story any more than you can push water uphill with a fork. Not only do your pants get wet, but you look like you're clueless about gravity and other forces of nature.
What drives media coverage of your company's crisis or controversy is being first with the headline, and then being first with new information as the situation unfolds. An editor or producer has no obligation to include -- much less wait for -- your company's spin of the story.
In the analog days, we'd say that a news story didn’t have to be complete because “there’s always another newspaper tomorrow.” We'd wait for it on the porch with our Tab and Space Food Sticks.
Today, however, updated and expanded versions of a story are delivered as fast as it takes to upload. Confirmations and clarifications, new discoveries, allegations, comment strings, Facebook posts, Tweets and real-time video spread across the ether with mind-blowing speed to form an information ecosystem that didn’t exist only hours before.
Not responding to a negative news story means you're adding another layer of risk to your company's reputation. You leave it to reporters to discover details you don’t have or don’t want to share. Information and speculation get rushed into the narrative, regardless of accuracy.
In most cases you prolong the bad publicity you were trying to avoid.
One more thing. The more obstinate your company in not responding to bad news, the more it becomes part of the story -- even the more damaging PR crisis.
Does that mean you must have answers to every question? Of course not. But there’s a huge difference between hiding under the desk and making a sincere effort to explain what you can and can't discuss. Engaging news media with sincerity during an emerging crisis -- including why you can't comment -- is a credibility factor. You may even get some breathing room to put new information in your context before it goes live.
The rule is the same whether you’re dealing with good or bad news: Say only what you know to be true.
But say it. Your company will be better for it.
InfluenceChronicles.com -- With cybercrime against U.S. corporations increasing beyond already epidemic levels, its victims remain largely ambivalent about when, why and how to communicate about it.
According to the advocacy group Privacy Rights Clearinghouse, U.S. companies have been hit with more than 2,600 significant network hacks and breaches since 2010. Yet the Wall Street Journal reports that in that same period, barely one percent of all publicly traded corporations disclosed any cyber-crimes in their Securities Exchange Commission filings – an apparently glaring contradiction in this era of hyper-transparency.
For some of these companies it’s also a precarious position. Consider the potential fallout should a company be forced by events or law to disclose a significant data breach, which in turn unveils previous incidents that were kept hidden from investors and customers.
So why are so few companies not communicating beyond what's required by current disclosure regulations? Here’s one reason: As a reputation risk management problem, a network hack or data breach constitutes a uniquely complex corporate PR crisis:
It’s no wonder that senior execs are more concerned with managing cyber threats than with almost any other risk to their companies’ reputations.
And it’s why many tried-and-true rules for crisis communications no longer apply.
InfluenceChronicles.com -- How'd you like to slog off to work every morning knowing that your customers don’t trust you? That sums up the life of local journalists, say two recent reports. Why it matters? Because it impacts how your local newspaper or TV Action News Team covers your company’s next crisis.
A Gallup Poll found that barely three out of every ten Americans trust what they see in the news. And on CareerCast’s 2016 list of the 200 worst jobs, newspaper reporter ranked dead last, with broadcasters taking bragging rights for being only the nation’s third-worst career. The annual list takes into account working environment, income, growth potential and stress factors.
Too many local reporters are overworked, underpaid, unappreciated and isolated in newsrooms that have neither time nor money to let them truly engage and understand the arenas they cover – especially the business world.
This leads to a fatalistic, cynical view of the world that steers even talented reporters down the path of least resistance, characterized by shallow, clichéd conflict stories that provide inaccurate or no context, and that give equal weight to any “contrasting” source, no matter its lack of credibility. For companies responding to complex crisis situations, this tired and formulaic approach to journalism can result in undeserved damage to their hard-earned reputation.
While it certainly doesn’t exist in every market, it’s important to anticipate this predisposition to fast-food local journalism, especially if your company’s crisis communications strategy is to speak with reporters. The best way to prepare -- aside from knowing your facts, messaging and how to handle interviews -- is to deliver as much concrete, articulate information as possible. Dish it up on the proverbial silver platter in easily digestible portions.
A seasoned and solid journalist will appreciate the directness, which will help ensure an accurate story. And for the over-worked and disconnected reporter, the closer you approach “add water and stir,” the better the chances the resulting story will accurately represent your company's position. Quite often it’ll be included verbatim.
What’s happened to local journalism – and especially local business reporting – is tragic. But the reality is that today’s lean media environment, with its ratings pressures and “pay by the click” compensation, forces many local reporters into being glorified stenographer-provocateurs looking for edgy or emotional angles.
Be aware and ready.
InfluenceChronicles.com -- Brand and reputation. It’s a critical distinction that drives a company’s ability to minimize the impact of its next public relations crisis.
Brand is how your company talks to the world.
Reputation is how the world hears your company.
Some people say reputation and brand mean the same thing. But that’s like saying the pitch and the swing are the same because they’re part of the same baseball game.
Closely related, but very different.
Reputation risk management is a paradox. On one hand the company's reputation is its most important asset. On the other hand it is the asset most vulnerable to damage by conditions largely out of the company’s control.
A brand is a promise, but more than just deliverables. It’s what the brand’s owner needs people and institutions that matter to believe to be true.
Reputation, on the other hand, is what stakeholders and influencers actually believe. It's a mix of personal experiences and influences, all weighed against motivations that drive every decision to trust a brand, buy a product or support an idea:
The wider the gap between a company's brand and reputation, the more potentially damaging a controversy or crisis.
But the more a corporate and brand reputation jive with what stakeholders want to believe, the stronger the company’s ability to navigate and even prosper through bad markets, complex public issues and crisis events. It’s no wonder that companies with solidly good reputations have market caps of 30 to 70 percent more than their book value.
Illustration courtesy Huffington Post.