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Crisis Communication: “how companies deal with their stakeholders?”
MBA Thesis
Professor Joseph Santora
Emeline Brulé Sup 5 1A
46 bd Gaston Birgé
49100 ANGERS
August 28, 2011
25,030 Words
Table of contents
Acknowledgement................................................................................................................4
Executive Summary.............................................................................................................5
Introduction..........................................................................................................................8
1. Theory about crisis communication...............................................................................11
1.1 The planning part of crisis communication..............................................................11
1.1.1 Defining the types of crises...............................................................................11
1.1.2 Dealing with stakeholders.................................................................................13
1.1.3 Crisis history affecting the current crisis...........................................................16
1.1.4 Risk communication affecting crisis communication.......................................18
1.1.5 Planning crisis communication along with corporate communication.............21
1.2 The action part of the crisis......................................................................................25
1.2.1 Responding to the crisis....................................................................................25
1.2.2 Involving the CEO in crisis communication.....................................................30
1.2.3 Changing crisis communication because of the internet...................................34
1.2.4 Helping new technologies for communication teams.......................................41
1.2.5 Protecting the organization’s reputation...........................................................42
2 MBA Thesis : « Crisis Communication » Emeline Brulé
1.2.6 Learning lessons about crisis communication...................................................45
2. Theory of crisis communication applied to real life crises............................................50
2.1 What to not do in crisis communication...................................................................50
2.1.1The EXXON Valdez oil spill.............................................................................50
2.1.2 Jack in the box...................................................................................................56
2.2 What to do in crisis communication.........................................................................60
2.2.1 Johnson and Johnson: the Tylenol tragedy.......................................................60
2.2.2 Malden Mills and Cole Hardwoods fires..........................................................71
Conclusions........................................................................................................................77
Recommendations..............................................................................................................89
Bibliography.......................................................................................................................93
3 MBA Thesis : « Crisis Communication » Emeline Brulé
Acknowledgement
I would like to thank Professor Santora for guiding me through my thesis, enabling me to
be more focused on the important parts of my plan.
I would also like to thank all professors from the International School of Management for
teaching me new theory on business and communication, and methods of work that I was able
to use during the thesis.
Finally, I would like to thank my family for supporting me through my work and
encouraging me all along.
4 MBA Thesis : « Crisis Communication » Emeline Brulé
Executive Summary
The number of crisis in business and various other areas is rising nowadays because of the
changes in technology and in society, and also because of the globalization. As countries and
companies depend on each other, when a crisis occurs, more people can be touched by the
consequences.1
But why is it so important to act during a crisis? What is at stake? What can companies
lose if they don’t act quickly?
It is quite simple: their reputation. Business success depends on many things, but mostly
on reputation. If people don’t trust a company, they won’t buy form it.
Even if the company created the brand, it is the consumer who owns it in the end.
Organizations have two key assets: the corporate brand and the product brand.
The corporate brand is the institution’s image, reputation, financial assets, performance
and people. Corporate brand simply tells the consumer what to expect from the company as a
whole. The product brand refers to the products and/or services that a company offers on the
market. A product or service has its own brand, but its image depends on its corporate
heritage.
Consumers have become stronger in the last few years and more demanding. They not
only want a product, they want an experience. This is the reason why greater discourse is
required between the corporation and its stakeholders, and companies who want to succeed
have to communicate the brand message to its prospects, clients, shareholders and
stakeholders, but also have them experience it.
1 Stephens Malone Bailey 2005
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There is a need for companies to communicate with their stakeholders. The corporate,
political, social and environmental events of recent years have meant that corporate citizens
just like their human counterparts can no longer exist as islands. They form part of the society
they live in and must ensure that they act as responsible members as well as communicate
their actions and intentions. Transparency is the key.
Effective stakeholder communication means talking to the employees, the unions; the
governments, the supplier and sharing not just information about the day to day operation,
short and medium term plans, but also the corporate vision, mission, purpose and values. This
is called a 360 degree communication.
Stakeholder corporate communication can be the reason an investor confronted by two
companies stock option will chose one company against another. The frameworks established
by effective communication could be the saving grace for a company experiencing an
unforeseen disaster.
Corporate communication plays three roles in the evolution of corporate organizations:
create the identity, build the brand, and manage the reputation.
Creating the identity involves the creation of a logo, style guides, and internal
communication manuals, templates for presentation, annual general meetings, and
environmental branding, which means creating a brand presence in the environment of work.
Building the brand is about having products or services that represent the brand and will
make a difference on the market.
Managing the reputation is about what people think and feel about the organization.
While brand is something that an organization can build its reputation is something it earns.
The brand is a promise and the reputation is the result of keeping that promise.2
2 Fernandez 2004
6 MBA Thesis : « Crisis Communication » Emeline Brulé
The brand is a very important item for a company, but its reputation is much more
important. If the company keeps its promises, then it will have a great reputation.
But when a crisis occurs, the reputation is at stake, so companies need to protect their
reputations, defend them and even restore them if the crisis has been really harmful.
The aim of this report is to see how companies can deal with crisis, using communication
to save their reputation and be able to keep on doing business.
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Introduction
There are several definitions of a crisis for an organization. Here are some of them, which
seem the most relevant to me.
Fink defines an organizational crisis as “a situation that can potentially escalate in
intensity, fall under close government or media scrutiny, jeopardize the current positive public
image of an organization, or interfere with normal business operations including damaging the
bottom line in any way.”3
Pearson and Mitroff define a crisis as “an incident or event that poses a threat to an
organization’s reputation and viability. A crisis places survival of the organization at serious
risk. Crises are composed of five dimensions, which are that they are highly visible, require
immediate attention, contain an element of surprise, have a need for action, and are outside
the organization’s complete control”. 4
Crises all have the same elements of surprise, of a trigger event and reaction to the crisis.
Through the crisis, organizations need to act rapidly, give responses, do damage containing
and then recover from the crisis and learn from it.
There is uncertainty in a crisis about how people should react, and there is also
uncertainty about blame, public perception, resolution and consequences. The aim of crisis
communication is to reduce uncertainty about these matters.5
The aim of crisis communication is to save the reputation of an organization and the
people in it. Communication cannot make the crisis disappear. Once the crisis has occurred, it
cannot be taken back. But crisis communication is about saving the company’s image despite
the crisis that it is facing.3 Stephens Malone Bailey 20054 Stephens Malone Bailey 20055 Stephens Malone Bailey 2005
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In crisis communication, the most important is to make sure that all the stakeholders get
the information that they need. These stakeholders are the tenants, vendors and regulators. It
is very important to do so because otherwise the company could lose its reputation, its money
and in the worst case the business in itself.
In order to have a good crisis communication, companies should plan the case of a crisis
and what to do in that case. They have to establish who will set up the crisis communication
team, the responsibilities of each member, which one will talk to the press and when. The plan
should include possible scenarios of crisis and what responses would be given to each
scenario. Making a plan prevents companies to make mistakes because of the panic of the
situation, which they would not make when planning a possible event.
When the crisis occurs, members of top management and employees who are related to
the crisis have to be informed quickly. Some companies have established a phone tree as soon
as a crisis occurs. Other companies make sure that top management is informed and then they
handle the situation.
In a crisis, to inform stakeholders various means can be used: phone, text messaging, e-
mailing, Facebook, twitter, company blogs, etc. These devices enable the company to inform
its stakeholders quickly and to update them on the situation. But using various devices doesn’t
keep the company from having only one spokesperson, which is critical in crises.
The message that is given during a crisis is very important, as much as who gives it. The
company needs to provide as much information as possible, and the message has to be
transparent, accurate and compassionate. The spokesperson has to know the facts and
understand how the crisis occurred and what will be the consequences. Only in that case can
the spokesperson give a clear message. Compassion is also very important because people
who are facing the crisis are likely to be scared and angry and will not consider the facts if the
company doesn’t express compassion. Then the company should explain what plan it will use
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to respond to the crisis. The aim here is to reassure the stakeholders on the future actions of
the company concerning the crisis and also making sure that it doesn’t happen again.
In a crisis communication trust is very important. The aim of the communication here and
all of its devices, such as public relations, is not the same as it usually is. Here the aim is not
to promote the company’s image, but to save it. The aim will be to minimize the damages on
the image of the company and to regain trust from the stakeholders and the public.
A crisis management expert, Jonathan Bernstein, explains that “communication is your
most important asset, yet it’s an area people spend the last amount of time protecting. A crisis
communication plan is not a cost, it’s an investment. Without it, 20 years of hard work
building your reputation can be destroyed in hours”.6
The aim of this report is to evaluate the crisis communication process. It will consider the
steps that have to be taken after a crisis occurs, but also the mistakes that can ruin the
company’s reputation for a long time.
The process will be described according to the company type, the stakeholders, the type
of event, and various other criteria. There will be a review of various topics such as previous
crisis affecting the following ones, the company’s reputation, risk communication, corporate
communication, the role of the CEO, etc.
Another part of the report will show real crisis communication examples, how things
were handled, who talked, and what the consequences of the event were.
Finally the report will come up with conclusions and recommendations about crisis
communication and how can companies deal with their stakeholders in a time of crisis.
6 Hunt 2011
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1. Theory about crisis communication
There are lots of writings about crisis communication, which mainly report several phases
in the crisis communication process, as there is in the crisis process itself. This first part will
explain all the notions surrounding crisis and crisis communication, such as the crisis, the
stakeholders, the communication team, the communication plan, etc.
1.1 The planning part of crisis communication
Crisis communication requires previous planning, which includes knowing the
environment of the organization pretty well.
1.1.1 Defining the types of crises
There are ten types of crises: natural disaster, rumor, product tampering, workplace
violence, challenges, technical-error product recall, technical-error accident, human-error
product recall, human-error accident, and organizational misdeed.
These crises are differentiated into three main categories: victim crisis cluster, accidental
crisis cluster and intentional crisis cluster.
Here a more precise description of each type of crisis by Coombs.
“Victim crisis cluster
Natural disaster: acts of nature that damage an organization (environmental, weather).
Rumors: false and damaging information about an organization.
Workplace violence: current or former employee attacking current employee onsite.
Product tampering/malevolence: external agent causes damage to an organization. Some
actor outside the organization has altered the product to make it dangerous.
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Accidental crisis cluster
Challenges: Stakeholders claim an organization is operating in an inappropriate manner.
There is a public challenge based on moral or ethical, not legal, grounds.
Technical error accidents: A technology or equipment failure causes an industrial
accident. The cause of the accident is equipment/technology related.
Technical error recalls: A technology or equipment failure causes a product to be
recalled. A product is deemed harmful to stakeholders. The cause of the recall is equipment or
technology related.
Intentional Crisis Cluster
Human error accidents: Human error causes an industrial accident. The cause of the
accident is a person or people not performing job properly.
Human error recalls: Human error causes a product to be recalled. A product is deemed
harmful to stakeholders. The cause of the recall is a person or people not performing job
properly.
Organizational misdeed: Laws or regulations are violated by management or stakeholders
are placed at risk by management. Members of management knowingly violate
laws/regulations or offer a product or service they know could injure stakeholders.”7
Responses given to the crises can be the same for each cluster, rather than preparing a
plan for each type of crisis.
For the first type of crises, the victim cluster, the organization is given low responsibility,
as it is often seen as a victim too.
7 Coombs 2004
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For the second type of crisis, the accidental cluster, the organization is given some
responsibility in the crisis but people acknowledge that the organization did not mean for it to
happen since it was an accident.
For the third type of crisis, the intentional crisis cluster, the organization is seen as
responsible for the crisis and its reputation is in danger. 8
1.1.2 Dealing with stakeholders
When an organization faces a crisis, many stakeholders can be affected by it. These
stakeholders can be internal and external; they can be the members of the organization, the
customers, the suppliers, the competitors and other members of its environment.
The company needs to know the number of stakeholders involved with it, especially in
times of crisis where stakeholders may appear and others may leave and not support the
company.
According to Dougherty, there are four types of stakeholders. These stakeholders are the
enabling public, the functional publics, the normative publics and the diffused publics.
Enabling public
They are the ones to provide the authority and who control the resources of the
organization. They can be the shareholders, regulatory agencies, or board of directors.
Functional public
They give input and take output from the organization. They provide labor and they use
the product or service of the organization. This group is composed of the employees, the
unions, the suppliers and the customers. In this group we have a new entrant during a crisis,
which are the victims. They can have been consumers, but as soon as the crisis hit them, they
became victims.8 Coombs 2004
13 MBA Thesis : « Crisis Communication » Emeline Brulé
Normative public
They have the same values and they have the same problems as the organization. They
can be trade unions or political groups.
Diffused publics
They are not directly related to the organization. They are not formal members of the
organization. When a crisis occurs, victims can also be in this group of they were not related
to the organization before the crisis occurred. For example if an oil company faces a crisis
where a boat has left oil in the sea, fishermen might be victims because they cannot fish
anymore, but they were never related to the oil company before.9
Once the company has established who its stakeholders are, the right message must be
delivered to the right people. The aim of the crisis communication in general is to preserve the
image of the company, or restore it if the crisis has damaged it. But regarding stakeholders,
crisis communication can also be a way to inform, convince and motivate some stakeholders
to take actions.
The crisis communication strategy will depend on the target audience, the type of crisis,
the available evidence, the severity of damage, the company’s performance history and the
legal issues. Other factors such as the damage done by the crisis can be included in the
strategic choices. The communication chosen in the crisis will have to do with the culture of
the company. The company culture will affect the way the company wants to address to its
stakeholders and to the public. Based on their cultures, some companies will take
responsibilities, some will offer an excuse and others may even put the blame on someone
else.
9 Stephens Malone Bailey 2005
14 MBA Thesis : « Crisis Communication » Emeline Brulé
Coombs used several works on crisis communication, including these of Allen and
Caillouet, and Benoit, to create five categories of responses given to a crisis. These responses
are the nonexistence strategies, the distance strategies, the ingratiation strategies, the
mortification strategies and the suffering strategies.
Nonexistence strategies
In this type of strategy the company deals with the crisis by denying its existence. The
company will say that the crisis didn’t actually occur. There are three ways of doing so:
clarifying that there is no crisis, attacking those who say there is a crisis or intimidating them
by a lawsuit for example.
Distance strategies
With this strategy, the company will try to put some distance between the crisis and itself.
In this case the company doesn’t deny the crisis but tries to make excuses for it. They try to
look like they didn’t intend for the crisis to occur, and they try to blame someone else for the
crisis. They also try to give justifications to the crisis by minimizing it or pointing out that the
victims deserved it.
Ingratiation strategies
This type of strategy aims at gaining the approval of the public by reinforcing the
company’s image and taking the crisis on its good side.
Mortification strategies
Companies using this strategy try to gain forgiveness and acceptance of the crisis. Here
the company will ask for forgiveness, give amends, tries to compensate the losses, and create
mechanism that will prevent another crisis to happen again.
Suffering strategy
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This strategy is quite simple. The company will position itself as a victim and try to gain
sympathy from the public.
Other strategies exist such as silence, which is not really a strategy because it shows that
the company has nothing to say for its defense. Other companies chose to use an expert to
analyze the crisis, what happened and what could be done to prevent another similar crisis.
1.1.3 Crisis history affecting the current crisis
Crisis managers need to take into account the fact people may know about past crises. If
people know that the company has already been facing a crisis, then they will expect the
company to handle the situation as they did before. If the company did not handle it well then
the public will expect the situation to go wrong and will not listen to what the company has to
say. If the company handled it well, the public will wonder how the company could let
another crisis happen again.
In both situations crisis managers will have to be even more careful with the
communication they will use.
If the company has a past history in crisis, its reputation is even more at risk, the new
crisis creating a new threat to the already fragile reputation of this company.
When a crisis occurs, people will attribute the causes of the event to an organization or to
other people. They will attribute the cause of the event either to a person (personal causality)
or to an outside force (external causality). If they attribute it to a person, it means that they
think that the event could have been controlled by the people involved. If the crisis could have
been controlled by the organization, then people will hold the organization responsible for the
crisis, and its consequences.
The more responsibility people attribute to an organization during a crisis, the more anger
and negative view of the organization people are likely to be feeling.
16 MBA Thesis : « Crisis Communication » Emeline Brulé
When people make attribution, three different causes are often used. These causes are
stability, external control and personal control / locus.
Stability
It is when the cause of the event happens frequently, and instability is if the cause of the
event happens infrequently. That is when past crisis have an effect on people’s view of the
current crisis.
External control
Was the event controllable by some other person? Could someone other than the
organization do something to prevent the crisis?
Personal control / locus
Was the event controllable by the actor involved in the crisis?
Locus reflects whether the cause was due to the actor or to the situation.
Locus and personal control combined show the perception of people on whether the event
was intentional or unintentional.
With these three dimensions, people will decide if the organization is responsible for the
event. Let us take an example. If the event is perceived as stable, the company has a high
personal control and a low external control, and then the public will hold the company
responsible for the event.
So going back to past crises, when a company has a history of crises, the current crisis is
considered a stable crisis, because it has happened before, and the company will be more
likely hold responsible for it because it had control over the events and could have prevented
them, but then the event occurred again.
17 MBA Thesis : « Crisis Communication » Emeline Brulé
If the reputation of the company is in danger in a crisis, the company should use strategies
of acceptance of the responsibilities and consideration for the victims.
The crisis team has to take into account some variables to evaluate the threat that the
company’s reputation is facing. These variables are the crisis history (has the organization
already been facing such a crisis before?), the relationship history (the organization history of
good or bad behavior towards stakeholders), and the severity of the crisis (what is the amount
of damage done by the crisis?).
If the company has crisis history, and / or bad behavior history towards stakeholders, then
its reputation is more at stake when facing the crisis. 10
1.1.4 Risk communication affecting crisis communication
Crisis communication is also related to risk communication. A risk is the probability of
undesired effects arising from exposure to hazard. It is also defined by Manuele as “the
potential for realization of unwanted, negative consequences of an event”.11
The center for risk communication explains that risk communication is a “science-based
approach for communicating effectively in high concern situation”.12
The difference between risk communication and crisis communication is the moment at
which the communication occurs. In risk communication, it happens before any event, and in
crisis communication after the event has happened.
According to Fearn Banks, crisis communication is “concerned with transferring of
information to significant persons (publics) to help avoid or prevent a crisis (or negative
occurrence), recover from a crisis, and maintain or enhance reputation”.13
10 Coombs 200411 Ferrante 201012 Ferrante 201013 Ferrante 2010
18 MBA Thesis : « Crisis Communication » Emeline Brulé
There are several models that associate risk communication with crises communication,
explaining how people react to certain messages.
The mental noise model
When there is high stress and anxiety, people will not be able to process information as
easily as they usually do. The greater they perceive the risk, the more their ability to process
information will decrease. Stress generates mental noise that will prevent people from hearing
the message that is delivered to them.
The negative dominance model
This message shows how people will react to different messages, based on whether the
message is positive or negative. Negative messages receive more weight than positive
messages, which means that people place more value on their losses than on their gains in
high stress situations. This means that positive messages need to be delivered in order to
reduce the effect of negative messages. The words chosen in the message are also important.
If a message is positive but contains negative words such as not, cannot, never, nothing, etc.
then the message can be seen as negative. Positive messages have to focus on what is being
done, rather than being focused on what is not being done.
With all these models the idea is to understand the audience and its stake in the process.
So there are rules to apply in order to deliver the right message.
The first rule is to accept and involve the public as a legitimate partner.
The second one is to plan carefully and evaluate the efforts needed. The success will
depend on the communicator’s skills and whether or not the audience knew him and had
reasons to trust him.
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The third rule is to listen to the public’s specific concerns. The credibility of the
communicator is also depending on his ability to recognize the audience’s point of view as
valid.
The fourth rule is to be honest, frank and open.
The fifth rule is to coordinate and collaborate with other credible sources. The person that
will deliver the message cannot express a completely opposite message to another
organization’s or make critics about other people, because the audience might feel that they
have to chose between messages or not believe any message at all. Conflicting messages are a
waste of time and they can increase the audience’s frustration and distrust.
The sixth rule is to meet the need of the media. In order for the message the
communicator wants to deliver to be released by the media the way he wants it to be, meeting
with the press is very important. A different message, shorter, can be dedicated to the press
because they need only facts, and the message for the audience has to be more complete and
more developed.
The seventh rule is to speak clearly and with compassion. Even if the situation is tensed
and the public is angry or scared, the person who will deliver the message has to give a clear
speech.
The communication can be misunderstood, even if the organization is following the rules.
Some mistakes have to be avoided. The speaker should not use jargon and technical language
that cannot be understood by the public. He cannot attack the audience of it expresses issues.
He should be careful about not sending negative non verbal message. He cannot blame
someone else, because putting the blame elsewhere is confusing for the audience and pushes
them to choose sides. He cannot focus too much on money, saying that there are not enough
funds to solve the problem. He would rather tell them what will be done with the existing
20 MBA Thesis : « Crisis Communication » Emeline Brulé
funds. Trying to be funny is a mistake too because people do not want to laugh at a serious
situation. He cannot be too long on the presentation. The presentation should last no longer
than fifteen minutes, and the rest of the conference will be dedicated to answering questions.
He shouldn’t make promises if he cannot keep them, instead he should use strong assurances.
He shouldn’t overuse statistics, because they are here to enhance and make a contribution, but
they are not enough. 14
1.1.5 Planning crisis communication along with corporate
communication
Crisis communication cannot only be directed by the public relations department, because
it needs more than just communication experts.
Once a crisis has occurred, mass media take an important role since they are the ones
giving the information to the public. Because of this fact, management should cooperate with
mass media to master the information that they get.
Crisis communication also implies crisis management. Employees have to be maintained
informed of the situation as much as people outside the company.
When a crisis occurs, ten steps have to be taken by the organization, according to
Bernstein. The first seven steps are part of the crisis planning, which means that these
decisions should be made before any crisis occurs and then adapted in times of crisis.
The first step is to identify the crisis communication team. In theory, the leader of the
team should be the CEO of the company and other chiefs such as the Chief of finance or the
Chief of personnel.
The second step is to identify spokespersons. This person will have to do internal and
external communications, talk in public, in front of a camera, and during public meetings.
14 Ferrante 2010
21 MBA Thesis : « Crisis Communication » Emeline Brulé
The third step is to train the spokesperson. Preparation is important because the
spokesperson will have to answer questions quickly and in a good way for the company to
look good.
The fourth step is to establish a notification system. This will enable the company to send
messages to all of its stakeholders in the right timing.
The fifth step is to identify and know all the stakeholders, internally and externally. They
can be the employees to a company, or the members of a nonprofit organization, the
consumers, the shareholders, the community, officials, etc.
The sixth step is to anticipate crises. Here the company needs to identify the potential
crisis with the best and worst case scenarios, and prepare answers to these crises.
The seventh step is to develop holding statements. They will be prepared answers for a
crisis, which will be adapted to the crisis when it occurs.
The eighth step is to assess the crisis situation. This step cannot be taken in advance. This
is a step that occurs after the crisis. The company has to be fully aware of the crisis situation:
what happened, how the company can answer to the crisis and what steps to take further on.
The ninth step is to identify key messages. Messages should be directed to specific
stakeholders but there should be no more than three different types of messages.
Finally the tenth step is to ride out the storm. The company has to adapt its
communication according to the reaction of its stakeholders.
The key to having a good communication is to adapt the company’s communication to
specific segments of audience (Luecke). This rule also applies in times of crisis.
22 MBA Thesis : « Crisis Communication » Emeline Brulé
There are six segments of audience for a company: the employees, the investors, the
customers, the suppliers, the community leaders, and finally the regulators and / or the
government agencies.
The CEO will have to address to employees prior to any press conferences, and keep
them updated. He will talk to them through companywide meetings, and letters. The message
will be about new jobs and retraining adapted to these jobs.
The CEO will also address to investors as soon as the crisis occurs through letters and
webcast, informing them of the change.
The marketing representative will address to customers with press releases to industry
trade magazine informing them that the company is working on changes to improve its
service. The message will also say that the crisis will make the company stronger, and that
there will be no disruption of orders or services.
The corporate supply chain manager will address to suppliers immediately informing
them that the company will get stronger with the changes. He will call them or send them
letters.
The CEO will address to community leaders before the press conference to inform them
of the change. A special meeting will be set up for this matter.
Finally, the CEO, supported by the legal counsel, will talk to regulators and government
agencies to from them of the change via a registered letter before the press conference.
Another expert in crisis communication, Turney, has evaluated six steps that are needed
during a crisis for the communication planning.
The first step is to state the mission of the communication team during a crisis. It still has
to be aligned with the organization’s mission. The mission of the communication team cannot
be to resolve the crisis, since that is management’s mission.
23 MBA Thesis : « Crisis Communication » Emeline Brulé
The second step is to identify the organization’s most critical publics to communicate
with.
The third step is to determine where crisis communication team members will be needed
and the location of any special operation center. The bigger the company, the more different
centers there will be, including for example crisis site, emergency operations center, public
relation offices, media center, etc.
The fourth step is to define task-related communication roles needed in the crisis. The
roles may evolve according to the size of the company and the nature of the crisis, but some
roles are very important and will be needed in all cases. One of these roles is the crisis liaison
manager, who will be the link between managers and will keep people updated. The employee
liaison will keep employees updated about the evolution of the situation for the company.
Spokespersons will talk to the media and give all the official information. Media facilitator
handle the media, sets interviews, gives background information. Investor and financial
community liaison is needed a publicly traded company. Finally the onsite monitor is the one
to look for information on the crisis site and update the crisis manager and stockpersons.
The fifth step is to prepare a crisis communication team roster with specific people to fill
each position.
Finally step six is about disseminating the plan and regularly updating it.15
1.2 The action part of the crisis
Once the environment is well known, as well as the potential risks that the organization is
facing, the action can take place. When the crisis occurs, the response stage comes along, with
all the devices needed, and the right team set to respond.
15 Valackiene 2010
24 MBA Thesis : « Crisis Communication » Emeline Brulé
1.2.1 Responding to the crisis
There are three main stages in a crisis, which are prevention, response and recovery. The
response stage is very important, as much as the two other ones.
The response stage is when the company has failed to avoid a crisis and is actually facing
one. At this moment, the company has to put resources in place and efforts in order to
minimize the effects of the crisis on environment, facilities and people.
At this stage, the organization has to make multiple decisions regarding what information
to share with what publics.
The response stage happens only minutes, hours and days after the crisis occurred. In this
stage there are still significant risks of immediate damages. It is a very important stage with
critical decisions to make. If the right communication is used during this stage, then the
recovery stage will be easier for the company.
During this period management has to restructure shared meaning and roles, but also
readjust basic assumptions.
Each crisis contains both success and failure. Whether people were prepared for the crisis
handling and how they behaved during the crisis will have an impact on the amount of
success after the crisis has occurred.
Preparation before a crisis isn’t only about choosing the crisis team and preparing
speeches. It is also about building a positive image for the company and being in good
relations with the press. Because when the crisis occurs, if the company has a good image and
a good reputation, it will be easier to argue than otherwise.
Having positive relationships, goodwill and trust in positives times will benefit the
company in the recovery stage.
25 MBA Thesis : « Crisis Communication » Emeline Brulé
In the response stage, time pressure and stress can be a barrier for managers when it
comes to looking for information.
Flows of information increase during that period because there might be a complex
situation, or many events at one time, that require accurate information.
But even if there is more information, the number of channels used to deliver the
information decreases. This can result in information overload and channel bottlenecks, which
in the end can cause the right information not delivered in time to the right group members.
The company will have a greater success if it shares information with critical stakeholders
before a crisis occurs. Among these stakeholders we will find the media.
In order to establish a theory on response stage during a crisis, scholars did an analysis of
qualitative data on the subject. They picked fifteen different organizations that faced a crisis
and made interviews with the people involved in the crisis. They chose them using Coombs
model of crisis in order to have a variety of organizational crises. There were fifteen crises
analyzed in thirteen organizations, two of them having faced two crises.
In order to do an analysis, the researchers used primary sources, interviewing people from
organizations, but also secondary sources, using information from previous studies
concerning ten other crises.
With all the data that was gathered during the study, some models of communication used
by companies during the crisis response were found. The linear crisis response
communication model was one of them. It was composed of four steps: a triggering event,
then observation, followed by interpretation, then choice and finally dissemination.
Triggering event observation interpretation choice dissemination
26 MBA Thesis : « Crisis Communication » Emeline Brulé
The observation step is about gathering information about the event that occurred. Here
organizations have to find information quickly and make sure that the information is accurate
and relevant.
The interpretation step involves attributing meaning to the information found in the
observation step. The organization will determine whether the information found is consistent
or not. If it is, then it will provide them a better understanding of the crisis, but if not the
company will not consider the information.
Then comes the choice step, in which the crisis team -or if there is no crisis team, the
decision makers – evaluates the information and then has to make a choice about what actions
to take in order to reduce ad prevent the crisis damages.
Finally the dissemination step is about informing those involved in implementing the
decisions. This is also the part of the response step when the organization will share
information with the public.
Another model found in the study was the spiral crisis response communication model.
This model comes as a more substantial model than the previous one. The linear model was
witnessed in each crisis analyzed, but was not quite complete.
The crisis response communication spiral happens when an organization faces a
triggering event and action needs to be taken quickly. The spiral model derives from the linear
model, except that we find out that companies often go through the steps of the linear model
again and again, which creates a spiral, as shown in the following tab.
27 MBA Thesis : « Crisis Communication » Emeline Brulé
Source: Hale Dulek Hale 2005
The spiral observation step is about observing and gathering information about the event.
It is quite normal that organizations have to go back to the observation step along the crisis
because new information comes forward and the company has to keep updating its
information.
The spiral interpretation is needed as soon as new information was found. This step can
also be needed when a choice needs to be done. It will help getting a better understanding of
the crisis so this step is essential.
The spiral choice is used whenever information is collected and a potential action could
take place deriving from the importance of the information found.
The spiral dissemination is constantly updated. Main actors of the crisis, stakeholders of
the organization and the public get information as soon as the organization has made choices.
The different steps of both models can be and are often conducted in parallel, according
to the information that the company gets, and new events coming along the crisis.
During each step, the crisis communication team is facing several challenges. One of
these challenges was finding data after the crisis occurred. Organizations often have a hard
time managing to find the right information about the triggering event or its possible
28 MBA Thesis : « Crisis Communication » Emeline Brulé
consequences. They need to prevent this lack of accurate information by sending people to the
event place and making their own investigation.
Another issue in the observation stage is that usual communication challenges such as
phones, email, etc, are not necessarily available during a crisis. This may seem to not be a
problem, but when a triggering event occurs and that people cannot communicate quickly, it
is a big problem because the first hours after the event happened are very important.
One challenge in the interpretation step is to interpret the data correctly. It is not always
easy to find the right interpretation for the information available. Determining whether the
information is accurate or not, relevant or not, is a challenge. Personal, professional and
organizational culture and values play an important role in evaluating the credibility of the
data.
In the choice step, the most challenging is the lack of time. The crisis communication
team needs to choose the better alternative action in a short amount of time, which requires
remaining calm and keeping the situation under control. But since the lack of time, and the
emergency that a triggering event creates, it is hard to make the right decision.
In the dissemination step, what is challenging is how to deliver the message to the public.
The message has to meet the needs of the target audience. If it doesn’t, then the audience will
not get the message as the company intended them to understand it.
The response stage in the crisis communication is not only about public relations. As
we’ve seen, it is about finding information, interpreting it, making choices, and only then
about communicating with the outside. The outside is not only the public, but all stakeholders
involved with the company.
The challenges that organizations face during a crisis happen simultaneously, which
makes it difficult to handle for the organization. These challenges put effective action in
29 MBA Thesis : « Crisis Communication » Emeline Brulé
danger, and if they are not handled well, they can create disruptions in the crisis response
stage and further put lives at risk, and the organization’s existence at risk too.16
1.2.2 Involving the CEO in crisis communication
The leader of the organization needs to anticipate what mental stresses others will be
experiencing and apply appropriate communication strategies to attempt to manage these
stresses and repair or preserve the organization’s reputation.
In a crisis situation there is often information overload, uncertainty and situational
complexity. Communication will suffer from unstructured tasks, stained relationships and
confused authority.
When a crisis occurs, the positive and negative aspects of a leader’s style are often
emphasized. They need to be prepared to adapt quickly to the situation.
During a crisis there is an emotional context that pushes the leader to inspire and persuade
others. This will make a change in the leader’s style because of the situation.
A transformational leader offers a vision and how it can be reached, he provides optimism
and confidence and he empowers his followers. He also leads by example.
The difference for a leader in a time of crisis is that people will be responding differently
to what they see, the information they get and how they perceive it. There is more at stake
during a crisis that there is at other times. The stress factor is very important and it will
determine how people will react.
Leaders will have more difficulties to gather information, and if they succeed to do it and
communicate it to the followers, they might not understand it well because people tend to
simplify complex information, and they might do it in the wrong way.
16
30 MBA Thesis : « Crisis Communication » Emeline Brulé
There are five mistakes that leaders or crisis communication teams make in a time of
crisis that can have terrible consequences for the organization.
The first mistake is to mix message from multiple experts. This is a mistake because the
public will not understand the situation if there are several experts explaining it in different
ways. Only one expert can be chosen and his message should be the right one, the more
accurate one, and the one that people will trust. Or many experts can express their view, but
the organization has to use experts that have the same view on the situation and give the same
recommendation otherwise people will not know which one to believe.
Another mistake is to provide information to the public, but too late. The risk here is that
of the organization gives information too late, other people, who will call them experts, will
give it before, and they might not give the right information, but when the organization will
give its answers it will be too late, because people will probably have followed other advices.
The third mistake is to adopt a paternalistic attitude. Saying that everything will be all
right is not the right attitude to take, especially at a time of information, when people can get
much information through social networks and the internet in general. On the contrary, the
organization should share the information that it has. The leader should communicate on what
information made him come to certain conclusions. He can asks himself what information has
he learnt that made him think that the situation wasn’t as bad as he thought in the first place,
and share this information with the public. This way he gives real information, that seems
reassuring to him, but he doesn’t just tell people a paternalistic speech.
The fourth mistake is to not counter rumors in real time. Thinking that a rumor is so
improbable that people won’t believe it is wrong, especially in times of crisis, when people
are more likely to believe rumors. Officials need to respond quickly to rumors, or the media
will report them to the public, and then it will be too late to change people’s mind about the
rumor. To prevent this from happening, the organization should have an open channel with
31 MBA Thesis : « Crisis Communication » Emeline Brulé
the media to communicate in real time. If the rumor is circulating on the internet, then the
organization should place a response on the internet.
The last mistake is to have a public power-struggle or confusion. The power-struggle part
can happen, but privately and it should be handled quickly. If this is not done under
confidentiality, then people will not be likely to trust officials. How could they trust people
who don’t get along together? When officials are in public, like at a press conference, they
should act as a united front because otherwise, if they argue, or if no one wants to talk first,
people are going to be uncomfortable with them.
During a crisis, a model that can be used to react to the crisis is the crisis and emergency
risk communication. This model emphasizes a participatory approach to communication
considering the social, psychological, and physical nature of the crisis. There are six
principles in that model: be first, be right, be credible, express empathy, promote action and
show respect.
Be first
The organization officials that have the information should be the first to provide it.
Be right
They also have to give all the information that they have, and inform people about what
they don’t know, and if they will have more information in the future.
Be credible
The organization has to tell the truth. Rumors are more damaging than hard truths.
Express empathy
The organization has to acknowledge what people are feeling, expressing that they
understand that the situation is not simple.
32 MBA Thesis : « Crisis Communication » Emeline Brulé
Promote action
They have to give people tasks, which will help restore order and reduce anxiety.
Show respect
They have to listen to people and treat them well, by communicating with them and
telling the truth.
Another important point during a crisis is the perception of risk. Some risks are more
accepted than others. Voluntary risks are more accepted than involuntary risks. Personally
controlled risks are more accepted than risks outside the individuals’ control. Familiar risks
are more accepted than unfamiliar risks. Risks generated by humans are less accepted than
risks generated by nature. Reversible risks are better tolerated than irreversible risks. Endemic
risks are more tolerated than epidemic risks. This means that people are more likely to accept
a car crash with few victims rather than a plane crash with many victims. Risks that do not
target a special group of individuals are more accepted than risks which do. Risks generated
by a mistrusted organization are less accepted than risks that are generated by a trusted one.
Risks that affect children are less tolerated than those which affect adults.
According to these risks, the leader should adapt his message. When the crisis occurs the
leader has to quickly make a statement, which will contain an expression of empathy,
confirmed facts about the event, what is known about the situation, what the process implies,
a statement of commitment, and finally where people can find information.
In order for people to understand the situation in the first statement, it has to be short and
focused, details will come later. Lots of background information is not needed at first. On the
contrary, important information matters most than details in such cases. The advices given in
the message have to be positive. For example instead of saying “don’t panic”, the message
should say “stay calm”. Finally, the message should be repeated so that a maximum of people
33 MBA Thesis : « Crisis Communication » Emeline Brulé
can hear it. It is a basic in communication, the reach and repeat, the more the message is
delivered and to the greater number of person, the best it will be understood and remembered.
Technical jargon, condescending sentences or tone, and making promises that can’t be kept
need to be avoided in messages.17
What is important to keep the trust of stakeholders after a crisis is the speed of the
response, the avoidance of missteps during the crisis, and the asking for forgiveness when
mistakes occur.18
1.2.3 Changing crisis communication because of the internet
The internet is now taking a major role in crisis communication. This mean of
communication is a new powerful tool that companies can use to communicate during a crisis,
but also a danger for them because it cannot be controlled. Rumors can be spread across the
internet without the company being able to handle it.
It has changed the way crisis processes develop and organizations need to adapt to this
new device. From its creation in the late nineteen nineties to today, the internet has become a
phenomenon that can’t be stopped and that has a very important social impact.
The internet is growing fast. Today more than a quarter of the world’s population has an
internet access, especially in the United States of America, where the percentage reaches more
than seventy percent of the population and in Europe where the percentage represents fifty
percent of the population.
In the last ten years, many blogs have appeared online, but also social networks such as
Facebook, Twitter or YouTube, which represent of place of sharing without precedent. The
internet has become a place where communication professionals have to be present because
they can reach the audience in an unusual way and make the difference with others.
17 Reynolds Earley 201018 Reynolds Earley 2010
34 MBA Thesis : « Crisis Communication » Emeline Brulé
The internet is now not only available on computers, but also mobile devices, digital TV
sets, and tablet PC. Because it is available nearly anywhere anytime, many customers,
investors, analysts, employees, the media, and others potential stakeholders of a company
have adopted it and made it their preferred platform of information.
But when it comes to crisis communication, the internet can quickly become dangerous
for the organization involved in the crisis. Rumors spread even faster than in the real world
and communication team do not know how to handle this.
In terms of crisis communication, the internet has provoked some changes. It has become
a new channel of communication, which is faster than any other is.
Companies are also now facing crises that exist because of the internet, such as crises set
off by spoof sites, rumors, hacking, shadow or copy-cat web sites, web security breaks, and
all forms of cyber-terrorism. Without the web there would be no such crises.
Before the appearance of the internet, companies would communicate through Medias
such as TV, the radio, press and magazines. The media used would consider the message and
chose if they accepted to publish it or not. It was called the one-to-many communication
model because it was the media that was giving information to the public.
But now with the internet people can share information without supervision of the media.
It is now the many-to-many communication model, where people can talk online and share
information through forums, online one to one discussions, or group discussion.
The media still have an important impact, but now companies who need to communicate
have to consider the internet as a new source of communication for most of its stakeholders.
In this new environment, new rules are in place. Now audiences have instant access to
information. Stakeholders are highly fragmented because of the vast choice of media available
online. With the conversation platforms online and social networks, individuals can gather as
35 MBA Thesis : « Crisis Communication » Emeline Brulé
a group and have a stronger voice. On the internet many information circulate but there is no
authority to distinguish the accurate information from the fake ones.
So now companies have to use the traditional media and the internet in time of crisis, and
give an even quicker response to the crisis before any rumors or negative information about
the company have the opportunity to be distributed online. The importance that the internet
will take in the answer campaign will depend on the consumers that have the company’s
product or service. If the company has business to consumer products or services, then the
consumers are very likely to be using the internet a lot to communicate, and they will have a
strong power. On the contrary, if the product or service is dedicated to professionals, then the
company would rather use more traditional medias and methods, because that is how it still
works in business to business.
The environment in which crises evolve today is more virtual than before, since many
individuals use the internet to spread their campaign against corporations. This is why
organizations need to use monitoring on the internet to identify, track and manage conflicting
issues before they become dangerous for the reputation of the company.
The internet media has to be considered on the crisis communication plans, including
potential scenarios of online crisis, or for traditional crises, online rumors.
Not only have the tool changed to respond to a crisis, but also the crisis itself. With the
internet, a crisis can become global in a matter of seconds and minutes. There are no more
time limits or geographical limits so there is a need for a more rapid response to the crisis.
The long lasting effect of a crisis has also changed because of the internet, because it is
impossible to eradicate what has been on the internet, good or bad, even when the crisis is
over.
36 MBA Thesis : « Crisis Communication » Emeline Brulé
But the internet is not only bad for companies in times of crises. It also has a great
potential if it is used well. There new opportunities to deal with a crisis. There are social
media platforms, the possibility of broadcasting digital videos and audio files for example.
Once the crisis is there, if there are negative information about it on the internet, the
company can still work with search engine optimization to make the website of the company
appear first when people do a search on Google or Yahoo or any other search engine. In
order to do that, members of the team need to have up to date technical education about the
internet.
As said before, the response needs to be faster than before. People are no longer expecting
a response after the twenty four first hours, but rather within hours. They prefer to have a
quick message on Twitter at least twice a day, rather than a big announcement at the end of
the day. This kind of response cannot be given as quickly unless the company has established
a clear social media policy long before the crisis.
This also implies that companies have to change now, before any crisis occurs, in
accordance with the online era. They need to ask the good questions. Organizations have to
engage online influencers, bloggers by responding to their posting via external corporate
blogs on a range of topics or by participating in online forums or social platforms. Internal
blogs and peer to peer platforms can also be created to encourage employees to exchange.
There will still be spokespersons and communication teams during a crisis, but other
employees have to be able to express their views on the crisis online, through social
computing technologies. Employees have the ability to change a negative opinion about a
company during a crisis if they feel that they can belong and participate in social media
communities.
37 MBA Thesis : « Crisis Communication » Emeline Brulé
Building open and honest relationship with key influencers establishes a company’s
credibility and may help prevent crises or minimize the damage they can do. Online crisis
management involves an important change of mentality because the internet has created more
potential scenarios to plan for, viral spreading, new forms of power configuration, and more
channels of communication to consider. But the basics of crisis communication remain the
same, and this new tool that can become dangerous for company’s reputation is also the same
that will help them keep it safe.19
Organizations need to implement internet elements during the process of a crisis. A crisis
has a lifetime cycle, just like a product or service has. It is composed of four stage based in
time: the issue management, the planning – prevention, the crisis and the post crisis.
In each stage, actions need to be taken to consider the internet.
Issues management phase
The organization has to assign resources, would they be human or economic, to issues
management tasks. It can be done internally, or with the help of an external agency.
An efficient online monitoring has to be established, monitoring web sites, blogs, news-
groups, etc.
The team has to be trained in order to be familiar with the online world and how it works.
A full map of influencers that show interest or issues on the web has to be drawn.
A corporate blog should be started to engage with the online community before any crisis
situation.
Guidelines have to be set for which way to address people on the online environment,
which is quite different from the more traditional media.
Planning prevention phase19 Gonzales-Herrero Smith 2010
38 MBA Thesis : « Crisis Communication » Emeline Brulé
The organization should develop a crisis manual online, which will be easier to update
than hard copy, and will enable the organization to put links to other sources of information
and databases.
Email lists and contact databases have to be kept updated at all times. All domain names
also have to be registered to prevent registration and use by activists groups.
An extranet should also be created so that crisis communication team members can have
access to internal information about the crisis, guidelines, plans, news report, statements,
contact information, etc.
A set of links should be prepared to be added to the website, connecting visitors to other
relevant sites, additional information and useful resources.
An internet expert should be added to the crisis communication team.
The capabilities of the company should be evaluated in order to know if the company can
develop graphic, video and audio files. If it can’t then the company should invest in
equipments or think about outsourcing.
The online crisis communication plan should be tested in advance.
Crisis phase
When the crisis occurs, the company needs to make sure that mainstream media and
online monitoring services are aware of the situation and that they report all outcomes online
as they appear.
At that moment, the company has to use the search engine optimization so that its website
appears first when people make researches.
An obvious link to “crisis information” has to be placed on the company’s website.20
20 González-Herrero Smith 2008
39 MBA Thesis : « Crisis Communication » Emeline Brulé
Post crisis phase
Although the crisis is over, companies should still track the issue by monitoring blogs,
online media, etc. for several months or even several years depending on the impact that the
crisis had.
Special thanks have to be done to the people who supported the company during the
crisis. It can take the form of thank you emails or thank you messages on the company’s
website.
An evaluation has to be run to know how the organization responded to the crisis, and
adapt further plans.21
1.2.4 Helping new technologies for communication teams
During a crisis, it is often said that face to face communication is the best scenario
possible to establishing a good plan, and handling the crisis well. But, as explained earlier in
the report, companies have to act fast when the crisis has occurred and such communication is
not always possible, especially of the company has various sites that are far from each other.
At this point, technology plays an important role because teams can use
videoconferencing to be able to get in touch with each other.
Decision making is more difficult during a crisis than in regular times because of the time
constraint, the changing situations, the incomplete information that teams can get, but also the
ambiguity if the situation and the pressure related to the crisis and its consequences.
Decisions have to take into account the allocation of resources for the accomplishment of
goals, with limited information and high levels of uncertainty. The quality of communication
among the team plays an important role in making the right decisions.
21 González-Herrero Smith 2008
40 MBA Thesis : « Crisis Communication » Emeline Brulé
Videoconferencing is a good help at having a good communication in times of crisis,
because people can exchange in real time and be able to understand each other well, better
than through emails or faxes, which could increase misunderstandings.
The availability of videoconferencing has increased in the last few years. Now there are
dedicated point to point systems, which make home video and office video available and large
hotels and conference centers also have them.
With such tools available, crisis teams can have ongoing communication and be able to
do group processes such as brainstorming, idea evaluation and consensus building.
Videoconferencing is the closest device to face to face communication. Of course it
cannot replace it and it is not as good as face to face communication. But compared to the
usual communication tools used during a crisis (which are phone, emails, or fax), it is far
better.
Complex messages, such as those used during a crisis, need rich media. Simple
information would require a simple email, but more complex information needs explanations
that cannot be given through an email.
Videoconferencing allows quicker feedback on the information given to team members,
and helps avoid misunderstanding or bad interpretations, because the person that delivers the
message can explain it in real time and make sure that the persons who got the message got it
right.22
1.2.5 Protecting the organization’s reputation
The more fragile and yet most important item to preserve during a crisis is the company’s
reputation. A crisis can damage the reputation of a company and if it happens then the way
stakeholders will interact with the company will change.
22 Chandler Wallace 2009
41 MBA Thesis : « Crisis Communication » Emeline Brulé
Post crisis communication can be used to repair the damages done to the reputation.
The reputation is recognized as a valuable, yet intangible asset in an organization.
Reputational assets can attract consumers, generate investment interest, improve financial
performance, attract talented employees, increase the return on asset, create a competitive
advantage and get positive comments from financial analysts.
The reputation is developed through the information that stakeholders get from the
organization. Stakeholders receive information about the organization through interactions
with the organization, mediated reports about the organization, and second hand information
from other people, such as word of mouth or blogs on the internet.
The major part of the information that stakeholders get comes from the mainstream
media, which is why organizations need to have good media coverage to build a good
reputation.
Reputations are based mainly on how stakeholders perceive an organization’s ability to
meet their expectations for treating stakeholders.
When a crisis occurs, the reputation of an organization is at stake. The crisis can harm the
stakeholders physically, emotionally or financially. A crisis gives people reasons to think
badly of the organization. The media and the internet play an important role here because
most stakeholders will get the information about the crisis through them.
With the news of the crisis, stakeholders can switch from valuing the organization to not
valuing it and spreading bad word of mouth, damaging its reputation.
One notion related to the reputation is the reputational capital, which is an organization’s
stock of perceptual and social assets, and the quality of the relationship it has established with
its stakeholders. The reputational capital is accumulated over time.
42 MBA Thesis : « Crisis Communication » Emeline Brulé
When the crisis occurs, the organization can lose some of its reputational capital. An
organization that had an important reputational capital before the crisis has more chances of
keeping its reputation safe than an organization that had a low or neutral reputational capital.
The organization with a high reputational capital will suffer less from a crisis and rebound
more quickly.
When a crisis occurs, the first to protect are the stakeholders. The crisis will create stress
among them, so they need information to be sure that things are taken care of. Then they will
need information about what will be done in the future to avoid such crises to happen again
and finally they will expect and need an expression of concern from the organization.
Only after that is done, the organization can focus on reputation. Doing it the other way
around would not be ethical and would not serve the company’s reputation at all.
People will react to the crisis according to various factors, including the crisis
responsibility, the crisis history of the organization and the relational reputation.
The initial crisis assessment is based upon the crisis type. The crisis type is how the crisis
is being framed. There are two levels of frames, which are the frames in communication and
the frames in thought.
Frame in communication is the way that information is presented in a message. Frame in
thought is the way that people will interpret the information. Frames in communication help
to structure frames in thought. The way that the message is framed will have an impact on
how it will be analyzed and interpreted. The focus on certain information will have an impact
on what people will focus on. If the focus is on certain factors more than other, then people
who receive the message will focus on these factors rather than the rest.
43 MBA Thesis : « Crisis Communication » Emeline Brulé
The damage done to the reputation can have effect on the interactions between the
organization and its stakeholders. After the crisis, consumers can stop buying the product or
services of a company and stakeholders in general can stop supporting the organization.23
Here is the Situational Crisis Communication Theory crisis response guideline according
to the crisis responsibility, the crisis history and the reputation:
1. Informing and adjusting information alone can be enough when crises have minimal
attributions of crisis responsibility (victim crises), no history of similar crises and a neutral or positive
prior relationship reputation.
2. Victimage can be used as part of the response for workplace violence, product tampering,
natural disasters and rumors.
3. Diminish crisis response strategies should be used for crises with minimal attributions of crisis
responsibility (victim crises) coupled with a history of similar crises and/or negative prior relationship
reputation.
4. Diminish crisis response strategies should be used for crises with low attributions of crisis
responsibility (accident crises), which have no history of similar crises, and a neutral or positive prior
relationship reputation.
5. Rebuild crisis response strategies should be used for crises with low attributions of crisis
responsibility (accident crises), coupled with a history of similar crises and/or negative prior
relationship reputation.
6. Rebuild crisis response strategies should be used for crises with strong attributions of crisis
responsibility (preventable crises) regardless of crisis history or prior relationship reputation.
7. The deny posture crisis response strategies should be used for rumor and challenge crises, when
possible.
23 Coombs 2007
44 MBA Thesis : « Crisis Communication » Emeline Brulé
8. Maintain consistency in crisis response strategies. Mixing deny crisis response strategies with
either the diminish or rebuild strategies will erode the effectiveness of the overall response.
Source: Coombs 2007
1.2.6 Learning lessons about crisis communication
The crisis communication plan has to be completed long before any crisis occurs. But
when the crisis currently occurs, the plan has to be used and followed carefully. Many
organizations make a great plan, but don’t use it in times of crisis because they feel it might
take too much time, or because they have too much pressure. One big lesson is to stick to the
plan. When the plan was created, people had time to evaluate the potential risks and the good
response. It was done to be a help so it cannot be left unused.
Another lesson is to anticipate criticism. No matter what event happens; no matter who is
held responsible, no matter what previous history of crisis the organization has, it will be
criticized by the public, elected officials and the media. It is inevitable to be publically
criticized as a normal part of the cycle of responding to a crisis. Team members, employees,
managers, even the CEO, have to remain focused on their objectives during the crisis
response stage and not listen to what people say about the organization. They have to respond
to the crisis, and make things right first.
Media responsiveness is not quite easy in times of crisis. Many plans include being
responsive to the media, collaborating with them and giving them the right information. But
the media need a lot of information in a short amount of time, and they will often ask a lot of
information to the organization because they have to be the first to provide the information to
the public. If the organization doesn’t have information yet, it can’t communicate it to the
media. Organizations should not let the media pressuring them into giving information that
45 MBA Thesis : « Crisis Communication » Emeline Brulé
have not been certified yet. The needs of the media should not determine how and when the
organization releases information.24
A crisis doesn’t necessarily have a negative impact. A crisis can cause disruption, but it
can also benefit an organization, if seen as an opportunity to learn. Mitroff offers a framework
of seven lessons that can help an organization emerge stronger from a crisis. These lessons are
emotional, creative, social and political, integrative, critical, aesthetic, and spiritual
developments that occur in crisis.
Mitroff sees crisis as a cyclical process. To him there is a way to stop the process of a
crisis. There are five stages to the process of a crisis. The first one is the signal detection,
when warning signs appear and prevention can be done to avoid the crisis to occur. The
second one is the probing and prevention, when team members should be looking for crises
risk factors and working to reduce potential harm. The third one is damage containment, when
team members try to limit the damage done. The fourth one is recovery, when the
organization is working to go back to normal business operations. And finally the fifth one is
learning and reviewing, when the team reviews and criticizes the crisis management process.
This last one will help improve signal detection if another crisis was to appear.
Coombs used Mitroff’s model, but simplified it and stated three stages on the crisis cycle:
the pre crisis, the crisis, and the post crisis. According to him, once the crisis is over, the
organization goes back to the first stage, which is pre crisis, but best prepared to another crisis
because of the learning experience it had when living the crisis.
Crisis theory acknowledges that warning signals can be acted upon to prevent a crisis, but
we realize in real life crises that these signals are being overlooked. Unfortunately, these
warnings are seen after the crisis has happened, and included in the learning process
afterwards. Hindsight knowledge always seems to reveal strong signals of the impending
24 Brown 2003
46 MBA Thesis : « Crisis Communication » Emeline Brulé
crisis. But if signals are revealed post crisis to help make sense of what happened, why is the
potential for signals to lead to a crisis not seen before the crisis strikes? Actually, it is
impossible to predict with any sort of precision when and where a crisis will strike. The
warning signals can only help the organization to reduce the impact of the crisis when it will
occur. And another problem is that organizations often fail to observe that their system is
failing. So other models may be taken into consideration when it comes to understanding
crisis processes.
The Learning Barrier Model shows how individuals and organizations move to success or
failure without seeing warning signals of potential crisis in their routine process. Pre crisis
communication entails two main functions, which are reducing the likelihood that a crisis will
occur, and communicating with key markets, audiences and publics to prepare them for a
crisis so that it can be framed and addressed when it occurs.
The first barrier to seeing signals is the classification with experience. As human beings,
team members only understand reality through the symbols they recognize. The symbol is the
verbal parallel to a pattern of experience. They perceive the world according to the symbols to
which they have been exposed. All new information is classified with a past experience. What
does not fit the classifications already in place is ignored or simply unnoticed.
The second barrier is the reliance on success. If the culture of organization is only focused
on past success, then future success can be hindered by blinding the organization to potential
failure. If the organization is only focused on success, it might not detect warning signals that
do not enter in the culture of success. According to Weick and Sutcliffe (2001) “arrogance
and hubris breed vulnerability”. On the one hand, for an organization to want to eliminate
failure is not a bad thing. On the other hand, not acknowledging failure inhibits the
organization from learning from smaller failures in time to prevent major crises.
47 MBA Thesis : « Crisis Communication » Emeline Brulé
The third and final barrier is trained mindlessness. This is when organizations train new
employees to do things the way they have always been done. By doing this, organizations
leave no room for new methods or new points of view. According to Langer, “individuals
who follow the same routine everyday without change become mindless experts who
concentrate on the end result and pay little attention to the process. They are not attentive to
the task environment and they don’t notice things out of the ordinary, and they are not
attentive to signals.
Without failure organizations cannot learn. Failures can act as small doses of experience
to discover uncertainties in advance. So the sooner failure is noticed and the organization can
learn from it, the sooner the crisis can be alleviated or even avoided. Turner classifies crisis
into six stages of “failures in foresight”. The first stage is when the normal operations take
place with cultural beliefs and precautionary norms. The second stage is the crisis incubation
period with early warning signals that are not noticed because of the beliefs and norms. The
third stage is the initial event that first draws attention to the crisis and challenges the
accepted beliefs. The fourth stage is the crisis going on and creating harm. The fifth stage is
the recognition of the collapse of beliefs and attempt to save the beliefs system. And finally
the sixth stage is a full cultural readjustment of beliefs that returns the organization to the first
stage.
The Mindful Learning Model tends to analyze facts when they occur, trying not to take
our symbols into account, but taking all facts into account. The situation can be reframed by
looking at the context, the environment, and the perspectives surrounding it. Reframing early
in the crisis cycle allows individuals and organizations to not only reduce the number of crises
but also shorten the time and severity of crises that occur. The organization’s culture
encourages or discourages its members to mindfully manage the unexpected. Learning must
48 MBA Thesis : « Crisis Communication » Emeline Brulé
be or become part of the organization’s culture for barriers to be acknowledged and warning
signals to be seen.
Learning is present through the crisis cycle. Some organizations will only learn in the post
crisis stage because their culture prevented them from seeing the warning signals, but some
other organizations will learn before that. If an organization learns in the pre crisis stage to
address an issue, then it is likely to remain in the pre crisis stage, mindfully monitoring other
issues that could lead to crises. The sooner warning signals, failures or crises are recognized;
the less damaging they will be to the organization. The others will learn later but as they learn,
they might not make the same mistakes again and be able to avoid any further crisis. 25
25 Veil 2011
49 MBA Thesis : « Crisis Communication » Emeline Brulé
2. Theory of crisis communication applied to real life crises
The first part of the report has shown that many theories exist about crisis
communication, how to handle a crisis properly, which team members to chose, which publics
to address to, what to tell them, how to overcome the crisis, etc.
The second part is dedicated at using this theory to see how organizations have managed
to get out of their crises. Have they applied the theory? How did it turn out? What were the
damages done to victims, but also to the organizations?
We will find out by studying great crisis of the twentieth century and how they were
handled.
2.1 What to not do in crisis communication
The following examples are crises in which the corporations did not use crisis
communication properly and put their reputation at stake. In those examples we will see that
the companies were more concerned about potential lawsuits than resolving the crisis. There
was no real concern for the victims and no excuses from the responsible for the crisis.
2.1.1The EXXON Valdez oil spill
Background
On March 24, 1989, just after midnight, the EXXON Valdez ran aground on Blight Reef,
and ten million gallons of crude oil gushed into the pure water of Prince William Sound on
the Alaskan coast from eight rupture cargo tanks.
50 MBA Thesis : « Crisis Communication » Emeline Brulé
More than two billion dollars were necessary to clean after the disaster occurred. The
EXXON Valdez was suit for pollution and damages done to nature. EXXON lost five million
dollar in oil lost, and twenty million in salvage and repair costs.26
Reactions
People do not deal easily with low probability, high consequences events such as the
EXXON Valdez disaster.27
People were shocked by such an event and could never have imagined it could happen.
There was a lot of anger among the public, especially people leaving close to where the event
occurred, that lost a lot due to the disaster. They were also disappointed at EXXON and at the
authorities for putting the blame on each other rather than taking action and cleaning the
mess.
Response
The response was not very efficient in the early hours after the event occurred because the
company did not have a solid plan in case of crisis. Their plan was inadequate in many ways.
They did not have immediately available response resources. They did not anticipate the
decisions and actions that such an event would require. They did not predict what they should
do in a crisis situation.
After some time, the federal on scene coordinator, the state of Alaska and EXXON
managed to put in place computer systems to track resource allocation, clean up progress,
availability of key personnel and spill movement. Even though their system was quite
sophisticated, with large databases and geographical information, and about hundreds of
computers working, this system was not available at the time of the spill, and decision makers
did not have access to all this precious information.
26 Harrald Marcus Wallace 199027 Harrald Marcus Wallace 1990
51 MBA Thesis : « Crisis Communication » Emeline Brulé
The coast guard on scene activated the regional response team and the On Scene
Coordinator organization. The coast guard and the EXXON decided to offload the vessel and
to initiate salvage measures. They stages response resources with the help of the state.
EXXON accepted full responsibility for the cleanup. It was then decided to use
dispersants, to allocate containment and removal equipments, and to use biological and
burning agents to combat the oil.
Since this was not really efficient (only fifteen thousand gallons were removed), it was
decided to allocate booms to protect vulnerable resources, and to replace and increase on
scene resources.
The crisis plan was incomplete and inadequate. The US and state government had a role
in the maritime safety. There were laws that were passed by the congress governing manning
standards and work rules on US flag vessels. The state of Alaska has a role in minimizing the
risk of a major oil spill. But there was a lack of control on vessels, especially on vessel safety,
including ship design and construction, crew training, licensing, and manning standards.
According to Lee Clarke, a sociologist at Rutgers University who specializes in
organizations and disasters, the EXXON plan about potential oil spill was a “symbolic plan”,
which is a plan that looks good on paper but can be worse than useless when push comes to
shove. The plan was developed by the Alyeska, an association of oil companies operating I
the port of Valdez, claimed that 65% of a hypothetical 200,000 barrel spill could be
recovered. The real problem was that no one had ever recovered anything close to that much
oil in open waters. The plan was made out of whole cloth. The symbolic plan soothed
stakeholders into thinking a big spill was manageable. But if Alyeska's symbolic plan had
been appreciated at the start, Alyeska and others might have deemed it inadequate and
focused more seriously on preventing a big spill in the first place.28
28 NA 2004
52 MBA Thesis : « Crisis Communication » Emeline Brulé
No one in the authorities thought that such a spill could or would happen. They did not
anticipate the limitations of the technologies available, the amount of equipment that would
be required and they did not plan operational strategies.
This resulted in a slow response to the crisis, because the contingency plan lacked
realism. It was EXXON and the government that brought resources but after the time for
effective response had passed.
Right after the oil spill, there was a 72 hours window of response opportunity, in which
effective mechanical removal of oil from the surface of the water was possible. But the
resources available on scene, accessible in the region and in the logistics pipeline, were not
adequate to do so.
Dispersants and burning techniques could also have been effective in that short amount of
time after the spill, but two days after the spill, a storm emulsified the oil. There was still a
window of response opportunity of a week in which oil on the surface could still be
significantly removed. But during that period, less than five percent of the oil was contained,
removed, dispersed or burned. After the first ten days, no more could have been done to
prevent the oil from reaching the beach.
The salvage of the EXXON Valdez was quite successful, thanks to the efforts of
EXXON, the US coast guard marine safety office Valdez, US coast guard pacific strike team,
and salvors contracted by EXXON. This prevented other millions of bbl of oil to enter the
Prince William Sound.
The beach cleaning was also another issue because the action taken to clean the beach
actually harmed the environment. The process of using high temperature, high pressure, hot
water, ten or twenty times, removed oil but also affected micro organisms that lived in the
tidal zone.
53 MBA Thesis : « Crisis Communication » Emeline Brulé
What also seemed to prevent both EXXON and the state of Alaska was the fear of a
lawsuit. Both parties accused each other of not moving first because of the possibility of a
future trial. Steve Cowper, Alaska’s governor said that “the legal system crippled our ability
to make decisions. Protecting themselves [EXXON] from a lawsuit was more important than
cleaning up oil”. On the other side, Lee Raymond, EXXON president, said that the state had
deliberately held-up cleanup efforts to bolster its own legal case: “they [Alaska] have been
preparing for litigation from day one”.29
Communication
In terms of communication, multimedia communication equipments and personnel were
deployed on scene. EXXON, key government agencies and local interest groups developed
videotapes and brochures to deliver their messages. But many pieces of technical information
were not explained to the public.30
People saw the disaster on TV, wildlife covered in black, bald eagles, seals, whales, ducks
and otters dying from suffocation because of the oil. Fishermen and other people living in the
areas had their livelihoods destroyed by the incident. They were blaming EXXON for the
disaster. Powerful pictures and raw emotions made EXXON look even worse.
EXXON directly put the blame on others for the disaster that had happened. The company
blamed the coast guards and Alaskan environmental officials. It made it worse for EXXON
because the public felt that EXXON wasn’t really concerned about the harm that had been
done to the environment and to people in the surrounding area. It looked like EXXON was
only concerned about limiting its liabilities and responsibilities in the incident. 31
29 Bowen Power 199330 Harrald Marcus Wallace 199031 Adubato 1994
54 MBA Thesis : « Crisis Communication » Emeline Brulé
By showing no sign of empathy, compassion, or concern, the company had trouble later
on to maintain its reputation because people only remembered what was said at first. This
discredited whatever the company had to say further on.
Even twenty years after the event occurred, EXXON is still not facing reality when it
comes to what happened and how things were handled. On the company’s website, only a few
words are written about the crisis, saying “ On March 24, 1989, the tanker EXXON Valdez
runs aground in Prince William Sound in Alaska. The Valdez oil spill was a tragic accident
that ExxonMobil deeply regrets. The company took immediate responsibility for the spill,
cleaning it up and voluntarily compensated those who claimed direct damages”.32
There would be so much more to say about this event, but instead the company made the
choice to give only few details about it and express regrets, surely too late.
According to the theory of crisis communication, EXXON did it all wrong. First, it didn’t
have a good crisis plan, or at least its plan didn’t manage to assess the worst case scenario and
what to do if that might occur. When the crisis stroke, there was no quick response, which is
the most important part of a crisis plan. People expect the company to act fast, to give answers
and to be present to handle the situation.
The crisis was in an intentional crisis cluster, more precisely a human error accident,
because it was the captain of the vessel, who wanted to avoid icebergs and made a bad move
so that the vessel has an accident. In these types of crises, people tend to consider the
organization responsible for the event, which is really what happened with the EXXON
Valdez.
And the company didn’t take responsibility right away for what happened so people hold
it even more responsible and unworthy of their trust, especially when facts were revealed
about the cost cutting that the company had been doing on environmental safety.32 <http://www.exxonmobil.com/Corporate/history/about_who_history.aspx>
55 MBA Thesis : « Crisis Communication » Emeline Brulé
The CEO didn’t play his role of spokesperson. He should have visited the site where the
crisis has taken place, but instead he remained at the headquarters because his lawyers advised
him to. He didn’t show compassion to the victims, and didn’t apologize for what happened.
This crisis has been hard for the EXXON Company and all the other authorities involved
because of their lack of actions, or rather their lack of planning for such an event. Their
reputation has been harmed too because they betrayed people’s trust in them. The event also
has had an impact on the economy, since the oil industry is an important industry in the
United States.
2.1.2 Jack in the box
Background
On January 13, 1993, the Washington State Health Department was alerted that doctors
Children’s hospital in Seattle were treating an unusually high number of children with E. coli
infections, a form of food poisoning that is life threatening to children.
Jack in the box is one of the fifth largest fast food chains in the United States. The CEO
of the company, Robert Nugent, was alerted on January 15 by the Washington State Health
Department that the E. coli outbreak was at least partly attributed to hamburgers purchased at
Jack in the box restaurants.
The CEO assigned a research team to Seattle to investigate.
One month after the first case was discovered, three children aged less than three died.
One of them had been eating Jack in the box food; one other had been in contact with a child
infected after having eaten at Jack in the box, and the last one’s infection was not certain.
Four hundred people were infected by the same bacteria in Washington State, Idaho and
Nevada. On February 6, 1993, the New York Times said that the E. coli crisis was Jack in the
56 MBA Thesis : « Crisis Communication » Emeline Brulé
box’s “worst nightmare”, reporting that shares of Foodmaker Incorporated, parent company of
the Jack in the Box chain, had “plunged, and the Securities Exchange Commission suspended
trading in the stock, reopening it the following week”.33
This crisis represented a threat for the sales of the company, and even its existence. On
February 5, Robert Nugent responded to accusations of culpability before a United States
Senate Subcommittee on agricultural research, forestry, conservation, and general legislation.
Response
The company didn’t accept full responsibility for the outbreak. They kept on saying that
they were not the only one responsible. During the crisis, Nugent kept on saying that there
was a “potential connection with between these illnesses and the food served through [their]
company”. He did that so that he might escape legal consequences from the crisis regarding
stakeholders. But, according to the New York Times, there were 40 lawsuits filed against
Foodmaker Inc., the parent company of Jack in the Box. These lawsuits were filled by two
stakeholders, who were consumers and franchises. 34
The company had to make an investigation to find evidence and interpret it the right way,
so that it might be helpful for the company during the lawsuits.
Once the company had done a primarily investigation, they maintained their position,
stating that they were not fully responsible for the illnesses. Nugent explained that “[they]
were informed that many of the children afflicted with this recent illness were consumers of
our establishment. Many other outbreaks victims were not our consumers”.35
With this statement, Nugent left the audience with two possible interpretation of the
crisis. The first one was that Jack in the Box was the only one responsible for the crisis, but
33 Ulmer Sellnow 200034 Ulmer Sellnow 200035 Ulmer Sellnow 2000
57 MBA Thesis : « Crisis Communication » Emeline Brulé
did not take responsibility for it. The second one was that there was some external agent had
also a role to play in the crisis.
Jack in the Box was creating an imbalance by doing this towards its stakeholders, putting
the blame on some external. The company was devaluating external stakeholders. Consumers
who were victims of the crisis did not find consolation in Jack in the Box messages. They had
still some physical damages from the E. coli, and they had hospital bills, but the crisis could
not be resolved until the company stopped looking at the evidence over and over.
Jack in the Box’s behavior during the crisis was quite unethical because the company did
not consider some of its stakeholders, the consumers, who were the victims of the crisis.
Instead, the company was more concerned about its employees and its shareholders.
In order to prove its point, the company relied on its respect of the FDA rules through its
history. Nugent asserted “In fact, the history of our company’s compliance with those
regulations is verified through numerous evaluations conducted by federal, state and local
governments”. 36But this was not a sufficient proof of their innocence, because other
restaurants were respecting the same regulations, and yet, none of them had such issues as the
one Jack in the Box was facing. Moreover, Jack in the Box had failed to meet the high
temperature guidelines imposed by the State of Washington for cooking hamburgers. Nugent
responded to this point by saying that he did not receive the message about high temperature
guidelines. By saying this he increased even more the ambiguity of the situation. This
statement created a doubt about the communication procedures of the Washington State
Health Department.
Once again, by defending that they were respecting the standards of the FDA, Jack in the
Box did defend the interest of its employees, and not of the consumers, the victims of the
crisis.
36 Ulmer Sellnow 2000
58 MBA Thesis : « Crisis Communication » Emeline Brulé
Communication
With their investigation, Jack in the Box found the origin of the contaminated
hamburgers. They questioned the meat inspection at the stage prior to the coming in the
restaurants. According to them, the source of the problem was the meat of one of its suppliers,
Von’s, located on the West Coast and Hawaii. They accused Von’s of supplying them meat
that was not fit for human consumption, and also accused federal agents of not having high
enough standards when inspecting meat. The blame was put on them, although it was proved
that Jack in the Box was using cool grill temperatures. They put pressure on their stakeholders
and did not consider at any moment discussing any internal problems.
Nugent did nothing to reassure consumers on the fact that the crisis would not happen
ever again by not doing an internal investigation, and trying to find other responsible for the
crisis.
Jack in the Box survived the crisis, but not without serious accusations of irresponsibility,
deception, and poor communication. The sales of the company did not reach its previous
potential after the crisis. But the franchise went back on its feet. 37
In this case the type of crisis can be either in a victim cluster crisis or an intentional crisis
cluster. If we believe what Jack in the Box claimed, then the crisis type is product tampering,
the supplier Von’s and federal agents being the ones to have caused the crisis, and by this fact,
causing harm to the company. If we believe that Jack in the box was responsible, because of
the cool grill temperatures, then the crisis is an organizational misdeed, because the company
would not have respected the federal regulations about heating temperatures in its restaurants.
In both cases, we can say that Jack in the box did not have a good crisis communication,
because the company was more attached to defending its own interest, than truly finding out
what happened. 37 Ulmer Sellnow 2000
59 MBA Thesis : « Crisis Communication » Emeline Brulé
The company, in the person of Robert Nugent, did not show any consideration or
compassion towards the victims. More than that, the communication was not clear or
transparent. The CEO of the company used unclear communication, through ambiguous
messages, and did not share the information in relation with his internal investigation.
2.2 What to do in crisis communication
In these few examples we are going to see how some companies managed to provide a
good response to the crises they were facing. In these examples the CEOs played an important
role as spokesperson. They showed compassion, empathy, and more importantly they acted
fast and provided transparent responses, giving all the information that they had. They acted
in order for another crisis not to happen again.
2.2.1 Johnson and Johnson: the Tylenol tragedy
Background
Johnson and Johnson is a drug manufacturer. Up until the nineteen eighties, it was a very
trusted company, which made good products and had a good reputation for it. It was a
household name. The company made baby products, such as baby powder, lotion, shampoo
and pharmaceutical in the world health organization list of essential drugs.
It had a good image among its employees. It was even elected on of the 100 best places to
work. The son of the founder wrote the company credo, stating that it had responsibilities
toward its consumers, its employees, the communities and the shareholders.
Here is specifically what the credo said:
“We believe our first responsibility is to the doctors, nurses and patients, to mothers and
fathers and all others that use our products and services. In meeting their need everything we
do must be of high quality. We must constantly strive to reduce our costs, in order to maintain
60 MBA Thesis : « Crisis Communication » Emeline Brulé
reasonable prices. Customers’ orders must be serviced promptly and accurately. Our suppliers
and distributors must have an opportunity to make a fair profit.
We are responsible to our employees, the men and women who work with us throughout
the world. Everyone should be considered as an individual. We must respect their dignity and
recognize their merit. They must have a sense of security in their jobs. Compensation must be
fare and adequate and working conditions clan, orderly and safe. We must be mindful of ways
to help our employees fulfill their family responsibilities. Employees must feel free to make
suggestions and complaints. There must be equal opportunity for employment, development
and advancement for those qualified. We must provide competent management, and their
actions must be just and ethical.
We are responsible to the communities in which we live and work and to the world
community as well. We must be good citizens – support good work and charity and bear our
fair share of taxes. We must encourage civic improvements and better health and education.
We must maintain in good order the property we are privileged to use, protecting the
environment and natural resources.
Our final responsibility is to our stockholders. Business must make a sound profit. We
must experiment with new ideas. Research must be carried on, innovative programs
developed and mistakes paid for. New equipments must be purchased, new facilities provided
and new products launched. Reserves must be created to provide for adverse times. When we
operate according to these principles, the stockholders should realize a fair return.
Johnson and Johnson” Source: Johnson and Johnson38
The company had good relations with the media too.
38 NA 2000
61 MBA Thesis : « Crisis Communication » Emeline Brulé
A reporter from the Chicago Sun-Times was assigned to do background research on
Tylenol, one of Johnson and Johnson product, for another journalist who was preparing a
story. He called a public relation staff member. The employee found it quite strange and
reported the call to the public relations department director, Robert Kniffin, who alerter
someone from the committee and the CEO of the company, James Burke. The reporter called
back a little bit later to explain that there had been reported deaths from the intake of Extra
Strength Tylenol.
Response
Corporate vice president Lawrence Foster took care of the public relations as soon as he
got the news.
The company didn’t have a crisis communication plan, not many companies did at the
time. It did have an emergency plan and call list for such incidents as plant fires. The first
step was to notify the chain of command.
There was an immediate meeting in Burke’s office with top executives, including
Lawrence Foster, head of public relations, David Clare, president and chairman of Johnson
and Johnson’s executive committee; Joseph Chiesea, president of McNeil consumer products
Company (a subsidiary); and David Collins, Chairman of McNeil.
During the meeting, Foster sent Kniffin to McNeil’s headquarters. Collins, who had been
president of McNeil Pharmaceuticals and knew the subsidiary well, was sent to McNeil. This
would have been the next step in the crisis communication plan, if there had been one.
The executives all said that it was a period of great fear. There were no warnings. Nothing
like that had ever happened to them or any other companies. A lot of questions were raised.
People didn’t know what was going on. They were wondering if there was a murderer in the
plant.
62 MBA Thesis : « Crisis Communication » Emeline Brulé
When the story was revealed by the media, the public was also afraid. The very idea that a
person could take a capsule for a headache and die was terrorizing. People were saying: “I
have a terrible headache, but I’m alive.” Even consumers outside the Chicago area were afraid
of Tylenol capsules, if not of all medications on the market. 39
Collins immediately set up a seven member crisis team. The team’s first task was to find
out what sickness it was actually facing. Then it would determine how to go about the healing
process. The crisis team handled decisions in the area of communications and was in charge
of all strategies and tactics. With Burke’s approval, the team decided to recall all Tylenol
capsules from stores in the Chicago area.
The recalled batch was tested and two additional cyanide-laced capsules were discovered.
Still, the team and company were uncertain of how the cyanide got into the capsules. They
hoped that the criminality was not in the company, but they could not be certain of it.
Johnson and Johnson had one overriding priority, which was to warn the public. The
company did that by being completely open and cooperative with the media in getting the
news out.
Foster said that there were three points that made the company successful in coping with
the crisis. The first one was that the company was open to the media. The second reason was
that the company was willing to recall the product no matter what that meant to the company.
And the third point was that it appealed to the American sense of fair play and asked for the
public’s trust.
Communication
39 NA 2000
63 MBA Thesis : « Crisis Communication » Emeline Brulé
Foster was responsible for the communications’ aspects of the crisis team’s work. The
team was concerned with helping the police and the FBI in finding the responsible party in
dealing with the Food and Drug Administration (FDA).
The first action of the communication team was to identify its key publics, which were its
consumers, through the media, the medical profession, employees and other internal groups,
and the FDA.
All publics were notified initially, and the team kept in touch with them throughout the
crisis.
The first story appeared in the morning edition of the Chicago Sun-Times on October the
first, 1982. The Chicago Tribune ran a story that same afternoon under a banner headline that
said: “five deaths tied to pills, Fear killer put cyanide in Tylenol”. The newspaper was quite
supportive of the company in the telling of the story. It didn’t’ use the “in-your-face”
coverage of crisis that was usual at that time. The company’s executives, the police, the FBI
and the newspapers knew from the start that the tampering could possibly have happened at
the plant, but there was no insinuation of this in the Chicago Tribune’s coverage. In that issue
the story was covered in four different stories, but the Johnson and Johnson name appeared
only on the first and second page, as follows:
“A spokesperson for Johnson and Johnson, parent firm of the company that makes
Tylenol, said Thursday evening his firm ‘launched an investigation this morning to track
down the capsules.’ The spokesman, Robert Andrews, and two other Johnson and Johnson
officials met for an hour and a half with Elk Grove Village detectives and evidence
technicians. He said his firm is ‘collectively shocked’”.40
Except from that quotation, all other mention of the company was of McNeil Consumer
Products Company, not as familiar a name as Johnson and Johnson. The caption on page two 40 NA 2000
64 MBA Thesis : « Crisis Communication » Emeline Brulé
indicated that medical examiners believed “the capsules were tampered with after leaving the
manufacturer’s plants in Pennsylvania”. 41
On Saturday, October 2, the headline in the Chicago tribune was “Stewardess is 7th
capsule poison victim”. There were two other stories about the Tylenol crisis, one about the
efforts to track the source of the poison, and another about funeral services for the victims. 42
On Sunday, October 3, the Chicago tribune’s front page banner headline “Shoplifter is
sought in poisoning probe”, referred to a story about a man who had been arrested a couple of
months before for stealing Tylenol. There was also an excerpt saying that consumers
nationwide were urged to stop using Extra Strength Tylenol capsules. Another excerpt said
that “Investigators have been unable to determine how and here the cyanide capsules were
placed in any of the suspects containers – whether the killer infiltrated the drug company’s
sophisticated manufacturing and distribution system at some point between plants in
Pennsylvania and Texas and warehouses elsewhere or whether the killer removed and
replaced containers once they have been placed on the shelves of the local stores. Stein said
he could not rule out factory error because of the reported disclosure by Lawrence Foster, a
spokesperson for Johnson and Johnson. Foster said potassium cyanide is used in chemical
tests at some of McNeil laboratories, but not in the manufacturing process. The labs are
remote from the manufacturing areas and cyanide would be detected even if someone tried to
introduce it during manufacturing.”43
Johnson and Johnson installed thirty three telephones to communicate with publics during
the crisis. Pretaped statements were placed on special toll-free lines to expedite news
gathering. The messages were regularly updated. A full page advertisement was placed in
41 NA 200042 NA 200043 NA 2000
65 MBA Thesis : « Crisis Communication » Emeline Brulé
major Chicago newspapers offering consumers an exchange of Tylenol capsules for Tylenol
tablets.
During the first week of the crisis, Kniffin handled the media from McNeil, whereas
Foster was in charge at headquarters. Approximately 180,000 news stories ran in newspapers
nationally. The story was at the top of television and radio newscasts.
Two thousand telephone calls were taken from the media. Thirty thousand calls from
consumers came in during the first month following the deaths.
But even though the situation was handled pretty well, there were still some issues.
During the first three days, as the Chicago Tribune article said, Foster issued a statement
to reporters that there was no cyanide in the manufacturing plants. A few days later, the
Associated Press heard that there was cyanide in the plants and called Foster to confirm the
report. After checking again, Foster discovered that indeed a small amount of cyanide was
used in the manufacturing plant for quality-assurance testing of some kind. However, the
cyanide was kept in a completely separate facility form the production line. Also, none of it
was missing. There was no way that it could have gotten into the capsules accidentally. Even
if it has, it would have been so dispersed as to be harmless.
Foster called the Associated Press and told them the truth. He had a reputation for being
honest, fair, and ethical. He could not afford a cover-up. When he told the wire service that
there was no way the cyanide could have gotten into the capsules, the reporters believed him
and agreed not to run the story, unless some other news outlet got the info too.
The Newark Star-Ledger got word of the information, called Johnson and Johnson for
confirmation, and again Foster said to trust him, and the reporter agreed.
Keeping his promise to the Associated Press, Foster called and told the wire service that
the Newark Star-Ledger had the information but also had agreed not to run it. The Associated
66 MBA Thesis : « Crisis Communication » Emeline Brulé
Press once again agreed not to run the story, unless still another newspaper or TV station got
the information.
But then the New York Times got the information too, and Foster gave up and called both
the Associated Press and the Newark Star-Ledger to tell them to run the story. The stories had
very little impact, as they were run on the Sunday edition in insignificant places, and mostly
because the facts were not blown out of proportion.
With this Foster realized that his positive dealing with the media over the years had paid
off. The story could have made front page headlines everywhere, but it did not because the
media trusted the public relations professional from their past dealing with him.
The FBI and the FDA never found any evidence of tampering at the two Johnson and
Johnson plants. They found that the contaminated capsules had come from both plants – one
in Texas, the other in Pennsylvania - but for the first time, there was basic proof that the
tampering was not an inside job. The finger now pointed to some external, malicious
psychopath who bought the Tylenol, laced it with cyanide, and placed it back in the containers
and on the shelves of stores.
After the crisis team found what had transpired, its members were relieved to be assured
that the contamination could not have occurred in the plants. The task of the team then turned
to saving Tylenol and restoring sales. The team was not worried that Johnson and Johnson
would go under because of the company’s diversified product line. Sales were not down for
other Johnson and Johnson products. There was no boycott against the company. However,
there was fear of Tylenol capsules. The future of Tylenol was at stake.
To reach the employees who had been worried while the company battled the crisis, CEO
Burke spoke to an assembly at McNeil and promised that Extra Strength Tylenol was coming
back. Employees had buttons on them that said “we’re coming back”. These employees that
67 MBA Thesis : « Crisis Communication » Emeline Brulé
were manufacturing Tylenol had been given other temporary jobs. Videotaped reports of
activities were shown to employees explaining what was going on with the crisis.
Information was sent through fax and telegram to major distributors who notified half a
million retailers and medical professionals.
Up to this point, there was a debate over whether to recall the product or not, but the FBI
and the FDA advised the company not to recall the products because it would mean giving in
to the terrorists.
The decision not to recall would have flown if it had not been for a copycat crime that
took place in northern California on October 5. The company decided then that removing the
product from all stores was the only way to show the public that it was concerned about the
welfare of its customers. On October 5, all products were removed from stores nationwide.
Later, there were approximately two hundred fifty copycat reports, all of which were
found to be without basis.
Recovery stage
During the recovery period, a decision was made to repackage the product. A sixty
second television commercial featuring the medical director at McNeil notifying consumers of
the upcoming return of Tylenol aired in October and November to an estimated eighty five
percent of US television households.
The triple seal safety package devised for the product was announced at a November
eleven news conference transmitted by satellite to twenty nine different sites were reporters
were gathered. Burke also announced the availability of coupons that could be used toward
the purchase of any Tylenol product and a special toll-free telephone number through which
consumers could learn about the special promotion. More than 200,000 calls came in to the
toll-free information number. Coverage of the press conference in the Kansas City Times
68 MBA Thesis : « Crisis Communication » Emeline Brulé
applauded Burke and the company for their efforts and described the new Tylenol safety
package as having “glued flaps…which must be forcibly opened. Inside a tight plastic seal
surrounds the cap and an inner foil seal wraps over the mouth of the bottle”. Johnson and
Johnson could not have paid for better coverage.
Johnson and Johnson executives did interviews with network televisions shows, such as
“Donahue”, “60 Minutes” and “Nightline”, as well as with major newspapers and magazines,
such as the Wall Street Journal and Fortune.44
As a result of the crisis, all Tylenol capsules were discontinued, as were capsules of other
brand names. Tamper-proof, triple sealed safety containers were swiftly placed on the shelves
of the retailers ten weeks after the withdrawal. Other manufacturers followed suit.
The crisis cost the company more than a hundred million dollars. Tylenol regained a
hundred percent of the market share it had before the crisis. Seven people died. Other lives
were saved by the company’s decision to recall all the capsules in the Chicago area. The
Tylenol murderer was never found.
An October 11 Washington Post front page article praised Johnson and Johnson crisis
response: “Johnson and Johnson has effectively demonstrated how a major business ought to
handle a disaster…what executives have done is communicate the message that the company
is candid, contrite and compassionate, committed to solving the murders and protecting the
public.”45
Marketers predicted that the brand would never recover from the sabotage. But instead,
two month after the tragedy, the company gained back thirty percent of market shares, even
more than before the crisis, when it was twenty seven.
44 NA 200045 NA 2000
69 MBA Thesis : « Crisis Communication » Emeline Brulé
The Chairman of the company, James Burke, was admired for his leadership and for his
decision making. He was also appreciated for his honesty with the media and the good way he
handled things. He looked in control, and people felt that they could trust him. Johnson and
Johnson was the first company to ever recall a product, which was appreciated of the public,
because it showed the concern of the company for its customers. 46
The Johnson and Johnson crisis was in the victim crisis cluster. It was a product
tampering. Someone who was never found altered the product to make it dangerous and make
the company look bad.
In this type of crisis, the company is seen as not responsible for what has happened. That
was the case for Johnson and Johnson. More than that, the company became heroic by
recalling the products and potentially saving lives.
This case is a really exemplary one. It is often cited as “what to do” in a crisis situation.
Indeed, even though there was not a real crisis communication plan in the first place, the CEO
of the company played an important role. He created a crisis team, allocating people and
resources at the right time and place. He showed compassion and concern. He played the
transparency card with the press and with all of the company’s stakeholders. He did it all
right.
The company was already respectful of its stakeholders, as we have seen in the credo of
the company. The stakeholders were clearly identified and a promise was made to them to be
respectful towards them and to work for the interest of all. This statement helped the crisis
team to identify the target audiences for their communication plan.
The good relations the company had with the press before the crisis was also a good help
because the company the press trusted them.
46 Rehak 2002
70 MBA Thesis : « Crisis Communication » Emeline Brulé
Without expressively having a crisis communication plan, the company followed the
steps that a plan normally has. This crisis was dangerous for the company’s reputation
because it was a matter of life and death, but thanks to the way events were handled, the
company went out of the crisis even stronger. It didn’t lose reputational capital.
2.2.2 Malden Mills and Cole Hardwoods fires
Here we will analyze the response of Aaron Feuerstein and Milt Cole, both CEOs of
companies facing fires inside their workplace. They both played an important role in the
resolution of their crises.
These two cases are often analyzed together because they both show effective crisis
management with values of corporate social responsibility and entrepreneurship. There was
also immediate response, supportiveness of victims, and rebuilding and renewal.
a) Malden Mills
Background
Malden Mills was a successful textile producer. The company was situated in Lawrence,
Massachusetts. It was owned and managed by Aaron Feuerstein.
The company was around ninety years old. It employed two thousand seven hundred
workers and had earnings of three hundred eighty million dollars. The company had an
excellent record of citizenship. It also remained stable, even in the face of growing
competition.
The workers were paid twenty percent above the average industry levels. Most workers
were unionized but there was no record of a strike in the company’s history.
The CEO described the company’s philosophy as “sensitivity to the human equation”. He
said that the “corporation had a responsibility to all its people”, and had also a responsibility
71 MBA Thesis : « Crisis Communication » Emeline Brulé
“to its community”. Feuerstein supported a certain number of community groups, activities
and religious organizations.47
On December 11, 1995, the plant exploded resulting in thirty six injuries among which
eight were critical. The fire affected three major manufacturing buildings, threatening the job
of nearly three thousand workers.
A large part of the facility was destroyed; so many employees’ job was at risk.
Response
The response of the CEO was immediate. He said he would rebuild the plant and still pay
employees their salaries and health benefits in the meantime. The rebuild took two month,
during which he kept his word and still paid the employees.
Feuerstein was a religious man. His religion was Judaism. He linked his personal
behavior to Old Testament teaching. In reference to fire, he often quoted the Jewish proverb
“When all is in moral chaos, this is the time to be a ‘mensch’”. Mensch is a Yiddish for a
righteous man – a man with a heart.48
Communication
The CEO was the one who talked and did the communication part.
The media coverage was good because the company had always a good reputation, and
the actions of Feuerstein during the crisis were seen as heroic.
Only one day after the fire started, the Boston Globe wrote that “with one of his buildings
still burning behind him, the sixty nine year old owner of Malden Mills spoke the works
everyone in the Merrimack Valley wanted to hear”.49
47 Seeger Ulmer 200148 Seeger Ulmer 200149 NA 2000
72 MBA Thesis : « Crisis Communication » Emeline Brulé
Even several years after the crisis occurred, the media kept in mind what he had done, and
gave him good press.
In 1996, in the New Hampshire Business Review, a journalist talked about the crisis as
follows:
“The day after an explosion and fire ravaged the Monomac building at Malden Mills, the
company's owner sounded these heroic words.50
"We're going to continue to operate here in Lawrence," said company President Aaron
Feuerstein. "We had our opportunity to run to the South many years ago. We didn't do it then.
We're not going to do it now." That was what the 1,400 employees thrown out of work by the
inferno wanted to hear. So did their families and their landlords and the nearby small
businesses that sold flowers and groceries and shoes to the people who took home Malden
Mills paychecks.51
But press accounts of the company's history told a longer, quieter tale of corporate
responsibility. In an age when capitalists leave behind entire communities in their restless
search for lower-wage workers, the Malden Mills story amounts to a heroic epic.”52
The article goes on explaining how many other companies in the sector have left for
cheaper labor, and even despite the fire, Malden Mills hasn’t.53
b) Cole Hardwoods
Background
The company Cole Hardwoods dried, warehoused and distributed a variety of native
hardwoods processed from several Indiana saw mills. The company processed around twenty
million board feet of Harwood annually. It had a net income of twenty million dollars.
50 Miller 199651 Miller 199652 Miller 199653 Miller 1996
73 MBA Thesis : « Crisis Communication » Emeline Brulé
The company employed a hundred and ten workers. The products were used for
architectural uses, furniture, cabinetry, and lumber yards in the United States and
internationally.
Milt Cole, the owner and CEO of the company, had personal drive, commitment and
powerful work ethics. His approach to business included personal loyalty and commitment,
interpersonal trust and credibility. He declared: “I believe in taking care of people. I have a
profit sharing plan and employees have never missed a year. They made the company, I can’t
do it myself”. He was also dedicated to his community. He had chaired the local United Way
community fundraising campaign and donated several scholarship to local colleges.
On June 13, 1998, a fire started at the Cole facility. The fire was one of the worst in the
history of Indiana. It lasted six days and burnt eighteen point five million board feet of green
and kiln dried hardwood. Ten buildings covering about a hundred forty thousand square feet
were destroyed, including all the company’s inventory, and lumber warehousing capacity, and
half of the company’s lumber handling equipment. The main offices and a small retail outlet
were destroyed. No one was injured during the fire.
Response
On June 15, 1998, early in the morning, Milt Cole gathered his employees and said to
them that he would immediately rebuild the facility and that he would continue to pay them
all.
As soon as the fire was over, the rebuilding began. The company continued its operations
even before the rebuilding was over. Even one year after the fire, and while rebuilding, the
company was making record profits.
Having to rebuild gave them the opportunity to improve the facility, and allow greater
profitability on less volume.
74 MBA Thesis : « Crisis Communication » Emeline Brulé
c) Similar crises, similar responses
Both crises were very similar, even if the two companies were from different size and
sectors. The similarity of the crises was what occurred, a fire. But there was also a similar
response to the crisis, and an important role of the CEOs.
Feuerstein and Cole both gave immediate response to their own crises. By responding
quickly, they reduced the uncertainty of the crisis and the potential harm that could be done to
stakeholders.
In both cases, customers were notified immediately of what was going on, and employees
assured that they would still get paid. The response occurred so quickly that the rebuilding
could start right after the fire was over.
The two companies had advantages in managing their crises, as compared to other
corporations.
The first point is that the two fires were accidental, and it was not due to a negligence of
the company. They could act fast and give quick response without fearing potential lawsuits
and image damage.
The second point is that they were privately held companies and they did not have any
pressure coming from shareholders or board of directors regarding their decision making,
especially when it comes to still paying the employees.
The two CEOs were true leaders, because they responded to the crises and exploited them
as opportunities for their businesses. They put the people first and then they rebuilt their
companies and became stronger.54
54 Seeger Ulmer 2001
75 MBA Thesis : « Crisis Communication » Emeline Brulé
Both cases were in an accidental cluster type of crisis. It was for both a technical error
accident. In these types of crises, the organization is not seen as responsible for what has
happened.
The responses of the CEOs were very quick, and they already had a good image and
reputation in their respective community, so the crisis did not damage their reputation.
They had responsible response and they rebuilt their companies. Few years after the
crisis, there was no sign of the fires, and the companies were doing well.
These examples are very good examples of what a company should do in times of crisis,
and how the CEO should get involved and act fast.
76 MBA Thesis : « Crisis Communication » Emeline Brulé
Conclusions
Crises have been around for a long time in the history of business and organizations in
general. They have sure evolved, as the world has evolved. Countries are now more
dependent on each other, so when a crisis occurs, it can touch much more persons and
stakeholders than it used to several years ago. The consequences can also be more damaging
than it used to, because with the evolution of telecommunications, people are aware of what is
happening nearly as soon as it happens.
Reputation and trust toward an organization is very important because it is what will
make people believe in the organization and support it. Without it the best company with the
best product won’t live and be able to prosper.
Consumers have become stronger because now they can get much information on a
product or service, or even on an organization and all of its doing. Information is strength. It
used to be in the hands of few people, but with the development of the internet, now anyone
can get nearly any information easily and quickly. When a crisis occurs, it is the same thing.
People will expect to get the information from the organization, because they will get it
anyway, but if it comes from the organization concerned by the crisis, they will be more
understanding towards the organization and more able to trust it further on.
Now companies and organizations are on the scene and their every move is watched by
everyone. They have to be transparent and they have to get responsible towards their
environment, the communities surrounding them and their stakeholders in general.
Corporate communication will help to create the identity, build the brand and manage the
reputation. Well, in a case of crisis, corporate communication will have the aim to keep these
assets safe.
77 MBA Thesis : « Crisis Communication » Emeline Brulé
Crises can take many different forms, but there are common particularities that define a
crisis. A crisis is often sudden and unexpected, it can harm people, or items, and the
reputation of the organization involved. Actions need to be taken in case of a crisis, and
communication plays an important role. Communication during a crisis aims at reducing the
uncertainty of the crisis, about what will be done to resolve the crisis and its consequences.
Information is the key aspect of crisis communication. The right information needs to be
provided to the key players, which themselves need to be identified properly. In order to do
that properly, a plan has to be done prior to the crisis to make sure that things go smoothly,
otherwise communication and actions might not be done well, due to the stress and potential
consequences that create pressure on the decision makers and communicators.
With the crisis plan, when a crisis occurs, people can act with less stress and pressure
because they can follow the guidelines that have been established and stick to the plan. It will
enable them to respond more quickly and with the right tone. It is what will enable the
company to keep its reputation safe.
The crisis plan will be adapted according to the crisis type. There three main categories of
crises, which are the victim crisis cluster, including natural disaster, rumors, workplace
violence, and product tampering; the accidental crisis cluster, including challenges, technical
error accidents, and technical error recall; and the intentional crisis cluster, including human
error accidents, human error recall, and organizational misdeed.
According to the type of the crisis, the organization will be seen differently. In the victim
crisis cluster, the organization will be seen as a victim too, and its reputation will be less at
stake. In the two other categories of crises, the organization will be held responsible, but in
the accidental crisis cluster, people will also acknowledge that the crisis was unintentional and
will not blame the organization as much as in the intentional victim cluster, which is the most
dangerous type of crisis for the organization’s reputation.
78 MBA Thesis : « Crisis Communication » Emeline Brulé
In any crisis type, important information that the organization needs to have is who their
stakeholders are, and who will be touched by the crisis. There are four types of stakeholders,
which are the enabling public, the functional public, the normative public and the diffused
public.
The crisis communication will also depend on the culture of the organization. The
organizational culture will have an effect on the response too. Some companies will play the
avoidance card, others the blame on someone else, and others will take responsibilities.
Several strategies are possible, including the nonexistence strategies, the distance
strategies, the ingratiation strategies, the mortification strategies and the suffering strategies.
Whether the organization has previous history of crisis will also change the current
situation. A past crisis known of the public will make stakeholders, the media, and the public
in general less understanding towards the organization. Communication will be even more
difficult because of what happened in the past crisis, and because despite the past crisis,
another crisis has occurred, leaving a feeling that the organization did not learn from its past
mistakes.
Past crisis will have an effect on attribution causes, stability, external control and personal
control / locus. People are more likely to think that the event was intentional if there is a
history of crisis.
In order for the company to keep its reputation safe in times of crisis, it is important to
consider the crisis history, the relationship history with stakeholders and the intensity of the
crisis. The relationship with stakeholders has to be maintained at all times, even when there is
no crisis. If the organization has a good and stable relationship with its stakeholders, by
providing them the information that they need and putting their needs first, then the
organization will be more likely to be trusted and supported if a crisis occurs.
79 MBA Thesis : « Crisis Communication » Emeline Brulé
Crisis communication is very close to risk communication. Risk communication happens
to prevent a risk, and crisis communication happens if the risk has transferred into a crisis.
Several models associate crisis communication with risk communication, including the
mental noise model, and the negative dominance model. These models help understand the
various audiences that the organization will have to address in case of a crisis and what best
message to deliver. Several rules help organizations in delivering the right message. These
rules are to consider the audience as a legitimate partner, to plan and evaluate the efforts
needed, to listen to the public’s concerns, to be honest, frank and open, to coordinate and
collaborate with credible sources, to meet the need of the media, and finally to speak clearly
and with compassion.
Maybe more important than what the organization should do is what it cannot do in crisis
communication. There are mistakes that absolutely have to be avoided or it could ruin the
organization’s reputation. These mistakes can be to use jargon and technical language that the
public cannot understand, attacking the audience, or sending negative non verbal messages.
Crisis communication has to be planned according to the corporate communication. The
plan should include keeping the employees aware of the situation, as well as other
stakeholders. The plan includes seven steps, which are to identify the crisis communication
team, to identify spokespersons, to train them, to establish a notification system, to identify
and know all the stakeholders, to anticipate crises, and to develop holding statements.
If a crisis occurs, the plan will help the organization to have a quick set up of the team
and clear objectives for the members of the team. Then they will have to assess the crisis
situation, to identify key messages and to ride out the storm.
80 MBA Thesis : « Crisis Communication » Emeline Brulé
Specific messages will be addressed to specific audiences. The main audiences for
organizations are the employees, the investors, the customers, the suppliers, the community
leaders, and finally the regulators and/or the government agencies.
After the crisis has occurred, the response stage comes along, and that is when the
company needs to be quick and give the right answers, otherwise the reputation could be hurt.
If the organization uses the right communication, the recovery stage will be easier.
In the response stage, decision makers have difficulties finding information because of the
stress and pressure. Flows of information increase during that period, especially if the crisis is
complex and represents many events at a time. But the number of channels that deliver this
information decreases, so the right information might be more difficult to get in time.
In the response stage, there is a model that usually happens. This model is the linear
model, in which there are four steps that are a triggering event, then observation, then
interpretation and choice and finally dissemination. But we realize that in a crisis there is
usually a going back to some of the steps of the linear model, which brings us to the spiral
model, which has the same four steps, but repeated over time when it is needed.
In order to prevent the lack of information the organization has to send people on the
crisis place to be sure to get the right information. Once they get the information they have to
interpret it the right way, and then make the right choice in order to handle the crisis well,
despite the lack of time that is inherent to a crisis.
We have seen that the response stage is not only about public relations but more about
finding the right information and using it the right way. Communication is only part of it.
Communication is the end of the process. It is very important, but if things have not been
done right before then the communication cannot be appropriate.
81 MBA Thesis : « Crisis Communication » Emeline Brulé
The role of the CEO in a crisis is very important. He or she has to be a true leader to be
able to contain all of the pressure that his company will be facing in times of crisis. He or she
will have to be at the top of his team and make the right decisions. He or she will also be the
spokesperson, and what he will say will represent the company as a whole.
Leaders in times of crisis have to be particularly careful in the actions they will take and
the behaviors they will adopt. There are mistakes that have been done in the past by many
leaders and that cannot be done because they might put the reputation of the organization at
risk. These mistakes are to mix messages from multiple experts, to provide information to the
public too late, to adopt a paternalistic attitude, to not counter rumors in time and finally to
have a public power struggle or confusion. If the leader succeeds in avoiding these terrible
mistakes, then he should be able to manage the crisis.
He or she can also use the crisis and emergency risk communication model. This model is
about being first, being right, being credible, express empathy, promote action and show
respect.
What the leader will say is also important. He or she has to make a statement right after
the crisis has occurred. This statement does not need to be very long, but it has to contain an
expression of empathy, confirmed facts about the event, what is known about the situation,
what the process implies, a statement of commitment, and finally where people can find
information.
This will show the public that the company is concerned about what has happened and
will act on the situation to make it right. The message has to be repeated so that a maximum
of people can get it. Another important point is that if the company or organization is
somehow responsible for the event that has happened then the leader has to ask for
forgiveness.
82 MBA Thesis : « Crisis Communication » Emeline Brulé
Crises have changed because of the internet. New types of crisis can result from rumors
spread all over the internet. And typical crises can take a new turn because of the internet, that
enables information, even when it is not accurate, to circulate more quickly and anywhere in
the world.
The internet is here and it is a wonderful source of information and communication, but it
can be dangerous for organizations. Organizations have to make the most of it instead of
considering it only a threat. They have to use it in their advantage. The internet can become a
new source of communication for organizations, at all times, and especially in times of crisis.
This new media has to be taken into account in the planning process as much as in the
response stage. Companies have to take advantage of this new media in which it is maybe
easier to get the message delivered the way you wanted it to be. Organizations can broadcast
videos and audio files through their websites, and much information. The crisis team will not
be the only one to communicate online. Indeed, every employee can give his view of the crisis
and what the company is doing about it online.
The internet can also be used as a mean of communication. With videoconferencing,
distance issues during a crisis can be solved. New technologies can be a great help for
organizations.
Using these means of communication can help in saving the company’s reputation. The
reputation is the most important asset for an organization. The better the reputation was before
the crisis, the more chance the organization has to keep it safe.
Organizations accumulate reputational capital over time. When a crisis occurs, the
organization has to act fast to respond to it and do everything in its power to resolve the crisis.
By doing so, the organization shows its willingness to make it right. Only after that can the
organization think about managing its reputation.
83 MBA Thesis : « Crisis Communication » Emeline Brulé
What is really important when a crisis occurs is to stick to the crisis communication plan,
which was done properly and had time be thought over. What is also important is to anticipate
criticism, because whatever the organization will do, it will be criticized, that’s inevitable.
And organizations have to remember that the crisis’s consequences are not necessarily
negative. The crisis can be negative, but if the organization handled it well then it can learn
from it and improve its operations further on.
Crisis is a cyclical process with five stages, including the signal detection, the probing
and prevention, damage containment, recovery and finally learning and reviewing.
We have seen in the examples how well known companies in the United States have
applied, or not, crisis communication theory in times of crisis.
In the EXXON Valdez case, many mistakes were done. The response was nothing but
quick. All the persons involved, including the company, the coast guards and the state, were
all scared of a potential lawsuit and because of this none of them wanted to admit guilt. They
were scared that whatever they would say in public would be used against them in a lawsuit.
But because of this, it took them time to act and repair the damages done by the oil spill.
The time that they lost was precious. During the amount of time when the parties were
just avoiding reality, many damages could have been avoided. This resulted in the oil
reaching the beaches and EXXON having to clean, and by the same time damaging the
environment with the product dedicated at cleaning the beaches.
The CEO of EXXON did not come on site. He also did not clearly express empathy or
regrets. He did not explain what the company was doing to respond to the crisis. He clearly
did it all wrong. He used the blame strategy and did not take responsibility for the crisis.
84 MBA Thesis : « Crisis Communication » Emeline Brulé
The EXXON Valdez oil spill has been one of the most damaging oil spills in history and
the lack of responsiveness from the company and the authorities has been damaging for their
reputation.
Another similar example was Jack in the Box and the E. coli crisis. In that case the
company had an even worse reaction after the crisis occurred. The CEO of the company did
talk and made quite a lot of statements after the crisis had exploded. But in each and every
one of his statements, he never admitted guilt, never showed empathy, or expressed any
compassion towards the victims of the crisis, his own customers. His only concern was to
protect his employees and his company’s reputation. But by reacting the way he did, he
seriously harmed his reputation. He put the blame on one of his suppliers and the federal
authorities. By doing this he did not take into account the protection of his stakeholders.
These two examples truly show what companies and organizations should not do in times
of crisis. Thinking about the organization’s interest first is a true mistake, and it won’t help
the organization, and will most likely harm it and its reputation.
Some other companies, on the contrary, managed to handle their crisis well by adopting
exemplary behaviors, and CEOs intervening quickly after the triggering event.
In the case of Johnson and Johnson, the CEO made the decision to recall all the products
from the stores all over the country to make sure that his customers were safe until the origin
of the crisis was found. The company had already a good reputation. It was one of the best
place to work, the company respected its employees and its stakeholders, and showed it to
them when the crisis occurred. The CEO showed a lot of compassion and empathy, and his
decision of recalling the product was even considered a heroic act, even more when knowing
that two more cyanide infested capsules were found in the batch recalled. It was the first time
on history a company would recall a product to protect consumers. The company was also
very cooperative with the authorities that were running an investigation on the Tylenol.
85 MBA Thesis : « Crisis Communication » Emeline Brulé
Because the company and the CEO had always had good relations with the media, but also
because the CEO was cooperating and giving them all the information as soon as he got it,
being transparent, the media coverage was not attacking the company.
The CEO acted quickly, he also was very compassionate, very transparent too. His
decision to recall the product saved lives and saved his company’s reputation. The crisis was
attributed to some psychopath and the company was never held responsible. When the
company put Tylenol back on the market, consumers had faith in the company and the sales
went back up. This example is always cited as a good example of a crisis handled well, even
thirty years after it happened.
Two other good examples of how to handle a crisis properly were the fires at Malden
Mills and Cole Hardwood. In these two examples fires occurred in the companies, one
harming people, and the other destroying facilities.
In both cases the CEOs showed great compassion towards their employees and their
communities. They both knew that their companies had an important role to play for their
community. They were local companies that communities depend on to live. If the companies
had closed, the entire community would have been harmed because many people in the towns
were working there, and if they had no job left, then they would not be able to consume in
other companies, and that would have been a terrible crisis for the whole town.
Both CEOs acted quickly after the fires had started. They both said that they would still
pay their employees and they did. They both said that they would rebuild and they did. Here
we can see that they made promises that they kept and with that they gained the trust of their
stakeholders.
86 MBA Thesis : « Crisis Communication » Emeline Brulé
They were not responsible for the fires but they did not put the blame on some external
forces. In fact, they did not try to look for a guilty one, but they tried to look forward and try
to find some good out of the crises.
They really made the most of the crisis because when rebuilding, they improved their
facilities. They also had a good reputation even after the crisis because of their heroic
behavior when it comes to taking care of their employees.
When it comes to crisis, ethical behavior is very important. Companies have to consider
their stakeholders and to act for them. They have to give a quick response so that people know
what is going on, and know that the company is not letting them down. People have to be sure
that they can trust the company to act in their sense, to resolve the crisis, and to act in order
for no crisis to ever happen again.
During a crisis two issues are often opposed: legal issue and public relations. While
public relations would advise companies to accept guilt and express regrets, lawyers often, if
not always, advise their clients to not accept guilt, and not talk before an investigation has
been done, otherwise whatever they have said could be used against them. It is understandable
that lawyers would not advise their customers to admit their guilt if they might be suited later
on. But for the company’s reputation to be left unstained the company has to talk to his
stakeholders, to admit what has been done wrong and to say what is going to be done to make
the situation right. Companies can win the legal battle and lose the reputational war, so in the
end their business will be at risk. Lawyers have to be aware that communication is very
important in times of crisis. While the crisis communication team would want to give
information about what lead to the crisis, what happened, who might be at fault. The legal
team on the other side would advise so keep this information because it might be used during
a trial. Companies will often follow the advice of the legal team because they fear a potential
trial. But the advice of the lawyers relies on logic and legal issues. When a crisis occurs, the
87 MBA Thesis : « Crisis Communication » Emeline Brulé
public opinion relies on how the story is framed by the media and how the company responds
to the crisis. Managing a crisis with the media is already a trial, and the public is acting like a
jury, so companies have to be transparent and show goodwill.
So companies should really be careful about their communication when they are facing a
crisis, but sill listen to what their lawyers have to say, because in some cases, their advice
might make a difference.
88 MBA Thesis : « Crisis Communication » Emeline Brulé
Recommendations
We have seen in the thesis that crisis communication is very important for companies.
Organizations have to manage their reputation even before a crisis occurs. The reputation
is the organization’s most important asset, because it is what makes people trust it and support
it. In the case of a company, it is what makes people buy from it.
The relationship with all stakeholders has to be kept in shape during all the organization’s
life. That goes for the employees, the suppliers, the customers, the shareholders and the
community. Giving them information about how the company is run, what is the strategy,
what is done for them is very important.
The employees have to trust the company they work for. They are the first customers of
the company. The employees have to be treated properly, and given sense out of their work. It
is better for the company’s reputation if its employees are proud to work for it and identify to
the strong and motivating messages.
The suppliers have to be able to trust the company that they work with, but also have to
be aware of its plans for the future and be treated right.
Consumers want to know that the company they buy from is respectful of the
environment, of human beings in general and also concerned about its stakeholders. The time
when companies were making children work and polluting as they wanted is over. Now
people will boycott a company if they learn that it has an unethical behavior. Same thing goes
for the community.
When it comes to shareholders, the notion of trust is the same as for everyone else.
Shareholders also want to make sure that the company is handling their investment well, and
putting their interest first.
89 MBA Thesis : « Crisis Communication » Emeline Brulé
If a company manages to have good, stable and healthy relationships with its stakeholders
in regular times, then its work will be definitely easier in times of crisis. Why would people
not trust a company that has been transparent with them all along?
A good relationship with the press is also very important. As well as with its stakeholders,
the company should be transparent with the press in regular times. Doing press conferences,
delivering press releases when an important event is about to come and giving interviews
when asked to will show the press, and the media in general the company’s good will. Then if
a crisis occurs, the media will remember that the company has always been faithful to them,
and maybe frame the story the way the company explains it to them. This was the case with
Johnson and Johnson, when the CEO asked the press not to deliver specific information,
which was not relevant but could have harmed the company. The media trusted him and did
as he pleased.
After the crisis has occurred comes the time of recovery. Whatever has happened during
the crisis, the company will have to recover from it. Communication will have to keep coming
out to repair the reputation. The company might have to make some changes so that no other
crisis can ever happen again. The company will have to communicate on what is done.
Many companies now have more considerations about the environment, and what they
can do to not harm it. Companies such as British Petroleum that, as EXXON Valdez, have
encountered crises related to oil spill, now want to preserve the environment. They invest
some of their money in renewable energies, using the wind, water, or sustainable products.
They have to communicate about it so that the public is aware that they are changing their
behavior.
They come in the line of social corporate responsibility, which most companies now
adopt, communicating about it mostly on their websites.
90 MBA Thesis : « Crisis Communication » Emeline Brulé
To close this thesis, I’d like to come up with a very fresh example of a crisis that
hopefully will be avoided before it can harm anyone.
In the past few days a hurricane named Irene has been around the United States. We all
remember the terrible consequences of hurricane Katrina that hit New Orleans in 2005,
destroying everything on its path and killing more than a thousand people.
In order to not see history repeat itself, the American authorities are making everything in
their power to protect people from the hurricane.
While the hurricane was coming to New York City, the city prepared itself. Cas
Holloway, the city’s new appointed Deputy Mayor of Operations, explained that shelters were
being prepared and steps taken for the fury of the hurricane. People are asked to live their
apartments and homes. The governor Andre Cuomo deployed 1,900 National Guard troops to
the region to assist with evacuation, clean up and other duties.55
Even president Barack Obama has made a statement about the hurricane and the situation
that people will have to face “If you are in the projected path of this hurricane, you have to
take precautions now. Don't wait. Don't delay. We all hope for the best, but we have to be
prepared for the worst.”56
New York City was getting ready for the storm in other ways, too. Officials said they
were revoking permits for outdoor events like street fairs and concerts. And if winds get bad
enough, they said they may shut down a half dozen of the bridges that link the city's
boroughs. At the same time, there will be another unprecedented step, a virtual shutdown of
the city's transit system - that includes the subways and buses. It also includes the commuter
rail systems that serve suburban areas like Long Island, which is also in the storm's path.
55 Associated press 201156 Associated press 2011
91 MBA Thesis : « Crisis Communication » Emeline Brulé
The city has been preparing for the hurricane to come, taking action, communicating with
the public, and making sure that people won’t get hurt. The governor has declared state of
emergency, and delivered the following message to the residents of New York: “I urge New
Yorkers to personally prepare for hurricane conditions and to cooperate with emergency
officials if needed. By working together, we will all be able to face this storm in a calm and
organized manner.”57
The authorities and crisis management and crisis communication team are working hard
on this case, because various deaths have already been reported in Connecticut, Maryland and
Florida.
Authorities are communicating as much information as they can and the media makes
report several times during the day. With the internet, many people post pictures and videos of
the hurricane online, keeping other people all over the country aware of the situation. Thanks
to their preventive actions, lives will be saved and damages will be repaired.
This shows us that a crisis can be handled when it is happening too. Hurricanes are not
new to Americans, and they cannot be avoided since they are natural disasters, but they are
part of what we consider crises. And crisis communication also applies to these types of
events. We can see that with the experience that authorities have gotten over the years with
such events, crisis management and crisis communication have been improved.
57 Associated press 2011
92 MBA Thesis : « Crisis Communication » Emeline Brulé
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