when crisis hits! the importance of being prepared

When crisis hits! The importance of being prepared. Presented by Yeow Mei Ling

Managing Consultant and Crisis Communications Practice Lead

Text100 Global Communications

meiling.yeow@text100.com.my

“Good reputations can take centuries to build, but just

seconds to destroy”

What is your reputation worth?

“Corporate reputation is a more important measure of success than stock market performance, profitability and return on investment. Only the quality of products and services edged out reputation as the leading measure of corporate success.”

World Economic Forum

“30% - 50% of a company’s value is in

intangible assets.” Ernst & Young, Measures that Matter

Crisis Communications Preparedness: The Purpose • Marketing builds business value

• Crisis and issues management seeks to preserve business value

• Poorly handled crises affect trust ― and the bottom line: – Share price

– Loss of sales, contracts, goodwill, partnerships

– Price erosion

– Interrupted/damaged organizational performance

• Thoughtfully handled crises are an opportunity to: – Present the true soul of the company

– Prove management’s integrity

– Build and preserve credibility and trust with major stakeholders

What can go wrong?

• Act of God, business catastrophe, terrorism

• Employee (mistake, miscommunication, litigation initiation, IP theft, criminal activity,

dissatisfaction)

• Product, service or technology (network outage, service failure, downtime)

• Management, leadership, company performance (resignations or shareholder/board

pressure to resign, fraud, corporate investigation, personal indiscretions, earnings miss,

financial malpractice)

• Consumer, community or pressure group action or legislation

• Accident or negligence (causing illness, injury, fatalities, damages, loss)

Restructuring Merger

Bankruptcy Shareholder Value Low Morale

Hostile takeover

Disgruntled customers Office closure

Product failure

Declining revenue

Corporate transparency

Unhappy employees

.. .Multiplied by unprecedented market turmoil

Changes in

Society Changes in Business

Changes in Technology

TRUST Confidence in

each other,

not institutions

EMPOWERMENT

More choice, more voice

FRAGMENTATION Bigger cake, thinner slices

...Compounded by new worldwide dynamics

Can make a bad situation much, much worse…

• Deepwater Horizon Oil Spill

• Tony Hayward appeared unsympathetic and attempted to shift blame

• BP was too transparent in its attempts to manage its reputation

• People thought BP cared more about fixing its image than solving the problem

Can make a bad situation much, much worse…

• Sony repeatedly hacked

• Customer details shared

• PSN knocked offline for extended period

• Sony downplayed severity of problem

• Official communication was sparse and vague

• No details or timeline for situation resolution

SONY

TAIWAN FOOD SCARE

And can have a far reaching impact…

• What external and internal factors could represent a

crisis for your business?

• Define three major risks that you feel could affect

your business.

• Consider how prepared you are to deal with these

events from a communications perspective today.

What are your risks?

Types of crisis

Smoldering Resignation, product faults, legal actions, complaints, quality issue, unethical corporate actions, accountancy malpractice, poor financials

Sudden Accident, death, bomb, fire, serious product failure

Dealing with a crisis

Pre-existing relationships of trust

and goodwill

Strong values and company culture

Skilled crisis prevention, preparation, handling and

communication

• The ultimate objective: issues

don’t reach crisis proportions

• Very few crises are total

surprises

• A crisis is the latest possible

point at which a response can

take place

• Prior to this point, somewhere,

someone (usually senior

management) knows about the

probability of a crisis

Who owns the crisis?

Operational

Operations

Security

Manufacturing

Facilities

Physical recovery

Management and leadership

Overall responsibility

Official positioning

Business leadership

Spokespeople

Communications

Internal communications

CEO communications

Marketing/branding

Investor relations

Crisis Management

Team The key is effective coordination of the

management, operational and communications response to the crisis

10 guiding principles of managing a crisis 1. Have a clear process

2. Know how to analyze the situation

3. Develop clear objectives and strategies

4. Ensure smooth logistics

Action principles:

5. Speed

6. Consistency

7. Candour

8. Control

9. +1

Establish:

10.Monitoring and evaluation mechanisms

New Era Crisis Communications

Social media crises rising

Bad customer experiences

31% %6

What employees are doing

Social media can make a bad situation much, much worse…

A case study

National Australia Bank

Another case study

DBS Bank Singapore

Building Blocks, Holger Zscheyge, http://www.flickr.com/photos/zscheyge/49012397//

Building blocks for crisis preparedness

LISTEN

PREPARE

CRISIS

ENGAGE

REVIEW

REFINE

Map and monitor

social and

traditional media

channels

Create a crisis

communications

plan and train

executives to

engage Conduct

immediate debrief

on resolution

Manage dialogue

with Internal &

external

stakeholders and

communities

Revise crisis plan,

preparation and

monitoring

New era of crisis comms workflow

LISTEN

Buzz Analysis What is the size of the conversation

around your brand? What topics are generating buzz

around your company?

Audience Segmentation and Community Mapping What types of online communities are discussing

your company or products?

Influencer Topic Driver Analysis What do influencers think are the key issues?

Influencer Lists Who’s driving discussions

around your brand? Influencer Dashboard What was the tone of

influential posts toward your company? How often do

they discuss competitors?

Influencer Analysis: our experienced analysts deliver in-depth qualitative analysis of the online voices with the most influence on your brand.

Identifying Buzz: we identify which topics are getting the most attention in online discussions and why.

New era crisis communications

workflow

Outputs •Crisis communications plan and

spokesperson / community owner training program including: • Comprehensive DARE-based crisis

communications plan including social and traditional media, influencer and channel engagement strategy (includes internal influencers)

• Established ownership and coordination policies

• Executive and spokesperson training • Social media policy creation • Pre-engagement with influencers • Pre-established presence in key

communities

LISTEN

PREPARE

CRISIS

ENGAGE

REVIEW

REFINE

New era crisis communications

workflow

Outputs •Manage dialogue with Internal &

external stakeholders and communities including: • Social and traditional media outreach

and response to all stakeholders • Real time conversation and media

monitoring • Management of social and traditional

media newsrooms • Creation and management of crisis

micro sites • Strategic communications counsel • Senior consultant joins crisis

management team

LISTEN

PREPARE

CRISIS

ENGAGE

REVIEW

REFINE

Amplified

Authentic

Real time

360 degree

Internal vs. external

Vigilant Monitor multiple channels through social media dashboards and RSS

Internal is as critical as external – ensure all audiences are engaged appropriately

Crises don’t wait for news cycles – monitor and respond 24x7

All channels feed into each other – ensure your message is consistent

Not all channels and influencers are created equal – find those that amplify

Speak with a human voice – that’s what your communities use

The new era of crisis comms

• Identify your crisis communications team

• Have clear guidelines for internal and external comms

• Identify spokespeople

• Train spokespeople

• Establish crisis notification systems

• Identify and know your stakeholders

• Anticipate crises (scenario planning)

In short, be prepared...

How do you improve your organisation’s preparedness quotient?

First..

• Conduct a crisis communications audit

– Hot spots (vulnerability audit)

– Existing structures and processes

– Readiness and gaps

Second..

• Develop clear guidelines, best practices and policies

– Crisis communications manual

– Crisis reference kit

– Roll-out to core team(s)

Third…

• Conduct crisis simulation workshops

– With comms team or with wider crisis management teams and committee

What is crisis simulation training?

• A real live simulation exercise to experience the pace and passion of a crisis with particular focus on internal and external communications

• A great opportunity for individual brand communications teams to work side by side with each other and develop a regional/ global team mentality

• The chance for communications staff who may not always deal with the media directly to get a taste for press office life

A boost to any public relations professional’s ability to manage the media in a situation that could happen!

36

Workshop series #1: Semiconductor company • ‘As live’ crisis management simulation (part of internal

team building programme). • Text 100 developed a crisis around a fictional fire at the

company’s largest fab facility: Large fire spreading! Toxic cloud and missing, presumed dead, staff members.

• In London, Paris and Munich, the communications teams were given imaginary roles to play facilitated by Text100 consultants .

• Pressure from concerned relatives and industry bloggers to broadcast, print and online media.

• Workshop objective – To create a life-like crisis situation and see how each team reacted, learning from any shortcomings in the Company’s infrastructure.

Workshop series #2: Regional Bank • Simulation workshop followed completion of crisis audit and

development of group CC Guidelines

• Conducted over separate full-day workshops in TH, Indonesia, SG and MY.

• Scenario: Banking platform failure with no ATM & online transactions, no payroll transfers, no access to online information, eve of a long weekend, long cues, irate customers.

• Simulation collaterals included mock news and social media monitoring alerts, mock TV coverage, blog posts.

• Designed to provide a test bed and pressure cooker environment with breaking news, ambush interviews, trending twitter conversations, blogs and queries from authorities.

• CMT involvement (with Chairman/CEO) for decisions, approvals and media engagements.

• Actual best practices from ‘as live’ scenarios used to fine tune guidelines and drive home best actions.

Fourth

• Review, refine, refresh regularly

– Review with new crisis scenarios and industry developments

– Refine policies, processes and guidelines

– Refresh with existing and new team members

• Social media has changed the nature of crisis management

communications forever

• However, the principles of crisis management communications remain

fundamentally the same

• It is more critical than ever to understand your company’s channels of

influence, especially your employees

• You can’t rely on news media as the sole channel for crisis

communications

• Constant monitoring is vital

• Authenticity is currency

Being prepared is a weapon in the comms arsenal!

Summary

There’s an up-side

Thoughtfully handled crises are an opportunity to: • Present the true soul of the company • Prove management’s integrity • Build and preserve credibility and trust

with major stakeholders

Thank You

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