Lecture #9 Crisis Management

In Class Assignment #5  Name 5 crises that you can think of that have taken place in the fashion industry?

What Classifies a “Crisis”  Can range from:  Natural Disaster  Misrepresentation  Fraudulent Accusations  Rumors  Lies  Unpreparedness  Language  In adequate or harmful release of products/services  Even how you handle a customer complaint can result in a crisis

The Speed of Crisis  Today, the internet can help even the smallest crisis reach thousands of individuals within minutes.  With that said, individuals and organizations are even closer to creating a crisis.  In the 21 st century our society is filled with issues that affect us daily and even hourly.

Issues Management  The ability to understand, mobilize, and direct strategic and policy planning functions, and public relations skills. Toward achieving one objective: meaningful participation in creation of public policy that affects personal and organizational destiny.

5 Steps to Issues Management  Identifies issues which the organization must be concerned.  Analyzes and Delimits each issue with respect to impact on its publics.  Displays various strategic options.  Implements an action program to communicate the organization’s views and influence perception of an issue.  Evaluates its program in terms of reaching organizational goals.

Issues Management  Anticipated Emerging Issues  Identifies Issues Selectivity  Deals With Opportunities and Vulnerabilities  Plans From Outside In  Bottom-Line Orientation  Action Timetable  Dealing With The Top- must operate with the support of the chief executives

Risk Communication  Risk Communication- an outgrowth of issues management. It began as a process of taking scientific data related to health and environmental hazards and presenting them to an audience in a manner that is understandable and meaningful.

Risk Communication  Helps individuals understand messages when they are in high-stress situations. To help with this communicators have developed a message mapping process  Identify Stakeholders  Determine stakeholders concerns  Analyze specific concerns to fit general concerns  Construct Brainstorming  Put together supporting facts and proof for each message  Ask outside experts to test messages  Plan delivery of resulting messages and supporting materials

Risk Communication  Depends basically on the organization’s actions.  In the long-run actions speak louder than words in communicating risk  Message Maps  Three Key Messages  Seven to 12 words per message  Three supporting facts for each key message

Managing in a Crisis  Accidents and Disasters, known as crises, are often the biggest test of an organization or individual  Crisis- a situation that has reached a critical phase for which dramatic and extraordinary intervention is necessary to avoid or repair major damage.  How an organization handles itself during a crisis can influence its reputation for many years.

Managing in a Crisis  It can also cripple its reputation and suffer a large monetary loss.  If you think logically, be thoughtful, and act quickly you can help create a positive reputation.

When Crisis Takes Place  When a crisis takes place there are usually many signs that appear shortly after.  Surprise- when crisis breaks out, its usually unexpected.  Insufficient Information- things happen at once, rumors come out, blogs report false stories  Escalating Events- the crisis expands, Crisis  Injury  Death

When Crisis Takes Place  Increased Outside Scrutiny- Bloggers, the media, stock brokers, talk-shows, and the public feed the rumors  Siege Mentality- The organization feels surrounded Lawyers advise to say no comment because anything said could be used against the organization.  Panic- with all the walls caving in, panic sinks in.

Planning in a Crisis  The key to crisis management is making sure your organization is prepared.  All accidents make great headlines and wonderful reporting.

Planning in a Crisis  For each potentially impacted audience, define the risk.  The dies in the garment have resulted in skin irritation  For each risk, define the actions that mitigate the risk.  The product has been recalled  Identify the Cause of the Risk  If the public is aware that you know what took place, they are more likely to accept that you will fix it quickly.

Planning in a Crisis  Demonstrate Responsible Management Action  Acting to Correct the Issue  Create a Consistent Message  Agree on a spokesperson who can be the voice of the organization  The more serious the incident, the higher up in the organization you will want that individual to be.  Be honest, don’t cover up a lie.

Planning in a Crisis  Letting people know that the organization has a plan and is implementing it helps convince them that the organization is in control.  Be prepared  Be available  Be credible  Act Appropriately

Communicating in a Crisis  Lawyers traditionally have advised clients to do one of the following  Say nothing  Say as little as possible and release it quietly as possible  Say as little as possible citing privacy laws, company policy, and sensitivity  Deny guilt and act angry that such charges could possibly have been made  Shift blame or share blame with others

Communicating in Crisis  The best crisis communicators are those who respond promptly, honestly, and provide full information to the media during the crisis.  Executives often want to wait to communicate until all facts are in.

Communicating in a Crisis  By saying nothing, an organization is perceived as already making a decision  “No comment” makes the organization seem guilty.  Silence angers the media and makes the problem worse  Inexperienced spokespeople speculating nervously or using emotionally charged language are even worse.  Cardinal rule of public relations during times of crises is to tell it all and tell it fast.

Communicating in a Crisis  The goals, when communicating in crisis should be:  Terminate the crisis quickly  Limit the damage  Restore Credibility

Engaging the Media  When crisis strikes, the media becomes hungry for information.  There are a series of things an organization should do to make themselves available to the media.

Engaging the Media  Set up a media headquarters- all authorized communication must flow through  Establish Media Rules- the media are sneaky during crises. Determines which parts of the organization are off limits, what executives will be unavailable.  Media live for the “box score”- Crisis specifics make news.  How many were fired?  How many were missing?  How many died?

Engaging the Media  Do not speculate- if you don’t know the numbers do not make them up or pretend you do  Feed the Beast- provide answers to the media 24/7  Strive to keep the media updated on new information about the crisis.  Speed Triumphs- the media is often about speed first and accuracy later. Must monitor media to address what is inaccurately being reported  Cable Rules- 24/7 news channels make attending to a crisis an around the clock ordeal.

Speaking to the Media  Speak first and speak often  Don’t speculate  Go off the record at your own peril  Stay with the facts  Be open and concerned, not defensive  Make your point, repeat your point  Don’t argue with the media  Establish yourself as the most authoritative source  Stay calm and cooperative  Never lie

Crisis Response Strategies  Preemptive Action Strategy  An organization tries to be the first to tell the story and set the tone before others have the chance to tell their own.

Crisis Response Strategies  Offensive Strategies  An organization may attempt to attack the accuser when its logic or facts are faulty or if the accuser is negligent or malicious  The organization may try to embarrass the accuser through shame or humiliation

Crisis Response Strategies  Defensive Response Strategies  Denial  Excuse  Justification

Crisis Response Strategies  Diversionary Response Strategies  Concession: the organization gives the public something it wants which is valued by both groups  Ingratiation: actions are taken to appease the publics involved  Disassociation: distances the organization from the wrongdoer  Relabeling: devising a new name for a product or service, or even the organization

Crisis Response Strategies  Vocal Commiseration Strategies  Concern: organization does not admit guilt, but expresses concern  Condolence: a more formal vocal response, recognizes the sorrow of the personal loss or misfortune, but does not admit guilt.  Regret: admitting sorrow and remorse for a situation– the organization may or may not admit fault for the situation.  Apology- the organization takes responsibility and asks forgiveness– sometimes included compensation, aid, or money.

Crisis Response Strategies  Rectifying Behavior Strategies  Investigation: short-term strategy to examine the facts that led to the situations  Corrective Action- steps are take to repair the damage from the crisis and to prevent it from happening again  Restitution: the organization offers to provide the public with ways to compensate victims and restore the situation.  Repentance: fully accepts responsibility for its actions and offers to change its practices.

Crisis Response Strategies  Strategic Inaction  Silence: may choose to remain silent when it is under fire.  Used to protect victims privacy  Sometimes providing a short statement of why the organization is not speaking is beneficial  Not the same as “no comment”

Final Thoughts  Crises can range from natural disasters to crises brought on by carelessness.  Internet and social media cause a crisis to travel extremely quickly.  When faced with a crisis your organization should be the first to communicate with the media and you should communicated with them frequently.

References  Seitel, F.P. (2011). The Practice of Public Relations. Prentice Hall: Boston.