crisis and the ceo

Risk CommunicationsCounseling the Top Dog

Presented by Dan Keeney, APRDPK Public RelationsFebruary 27, 2009

Agenda

Crisis fundamentals The role of public

relations How we sometimes

contribute to a crisis getting worse

Inside the mind of a CEO

Case studies

YourCompany

PR

The Fundamentals

The three components of

crisis communications are

crisis planning, response and

recovery

Crisis Planning

Fundamentals: Define It

A crisis is an unexpected and

uncontrolled event or series of

events that disrupt normal

operations for a prolonged period

and cause unwanted public scrutiny

Planning: Keep the Plan Simple

The process of planning involves an objective inward-assessmentExamine operations and processesEvaluate and catalogue assets

Good plans can be hundreds of pagesBetter plans are just a few pages

A Crisis Plan that Works

“One of the first things you learn is you

have to have a plan in place. It doesn’t

matter whether it’s sophisticated or

simple – you’ve got to have one. Frankly,

the simpler the plan, the better.”

- Larry Hincker, Virginia Tech


“Most plans I see are convoluted,

unrealistic, out-of-date nightmares to

interpret and never tested by a drill. Good

plans point you in the right direction so you

can act fast. If yours doesn’t, throw it out

and start over.”

- Richard Amme


Keep it simpleFocus on functional aspects of responseBuild out crisis infrastructureExamine and mitigate vulnerabilities

Planning: Crisis Infrastructure

Crisis communications library Fact sheets, bios, aerial photos, database of

contacts Communications infrastructure

Offsite crisis response facility Satellite phones, VoIP capabilities

Consider having a “dark” crisis response Web site ready www.yourcompanyanswers.com

Planning: Vulnerability Checklist

Fatality Succession Security Activism Health and safety Employee discord Workplace violence Forces of nature Litigation Hostile takeover

Regulatory Quality issues Legislation Racial issues Environmental issues Animal rights issues Human rights issues Guilt by association Criminal acts

Prioritize Target Audiences

InsidersEmployees, shareholders, suppliers,

customersGovernment

Local, state and federal regulators and lawmakers

NeighborsMedia to reach community

Plan for Rapid Response

Who is on the Response Team and who are their alternates?

At what point do you activate the Crisis Response Team?

How can they be reached 24x7?Who is spokesperson?

Prioritizing Target Audiences

InsidersEmployees, suppliers, customers

GovernmentLocal, state and federal regulators and

lawmakersNeighborsMedia to reach community

Prioritize from the inside out

Employees

Shareholders

Suppliers, customers

Government

Local, state and federal regulators and lawmakers

Neighbors

Media to reach community

The Role of PR

InvestigatorConfidantTruth tellerForecasterDo GooderImplementer

Investigator

Confidant

Truth Teller

Forecaster

Do Gooder

Implementer

The Dirty Little Secret Is…

We think CEOs haveit under control

The Dirty Little Secret Is…

But our deference to CEOs hurts them in a crisis

What Malcolm Gladwell Says

Communication in a Crisis

According to Gladwell:

“(Crises) are likely to be the result of an accumulation of minor difficulties and seemingly trivial malfunctions.”

- Outliers, pg 183

Example: Three Mile Island

Example: Three Mile Island

The Problem: Routine water blockage Moisture leaks into plant’s air system Then the accumulation of minor difficulties

1. Trips two valves, shutting down flow of cold water to steam generator

2. Valves for backup cooling system weren’t open3. Hanging tag in control room blocked view of indicator4. Backup relief valve stuck open5. Gauge in control room that should have warned of a

problem wasn’t working

Learn from Plane Crashes

Gladwell writes:

“The kinds of errors that cause plane crashes are invariably errors of teamwork and communication.”

- Outliers, Pg 184

Avianca Flight 052

An accumulation of little thingsMalfunctioning autopilotBad weatherLong flightMisunderstandings with FAAPoor communication in the cockpit

Let’s climb aboard…

Mitigated Speech

An attempt to downplay or sugarcoat the meaning of what you are saying

“Some people have been slow to embrace our message.”

Lessons from Plane Crashes

Airlines now employ “Crew Resource Management” training

Teaches junior crew members how to communicate clearly and assertively

Mitigated Speech in PR

Example: You learn that children are getting hurt using your product

How does your

CEO learn of

your concerns?

What do you do?

Brief your boss and hope

Send an e-mail

Walk into his/her office

Schedule a meeting

Call his/her cell phone

What do you say?

Let’s get the distributors on the phone

The switchboardis lighting up

Get the product off the shelf now

Who should we notify first about a recall

I think we may want to issue

a recall

Learning to be Assertive

A short video

Credit: Video Arts

What Keeps CEOs Awake?

Source: PriceWaterhouseCoopers 12th Annual Global CEO Survey

What We Know About CEOs

CEOs want the insights of key advisors

CEOs expect change CEOs feel less in

control CEOs value

reputation and customers

0% 20% 40% 60% 80% 100%

ChangedSuccessfully in

the Past

ExpectSubstantial

Change

CEOs: Know Change is Needed

Percentage of CEOs who say their organizations face substantial change vs. ability to manage change

Source: IBM Global CEO Study

IBM’s Analysis

Constant change is certainly not new. But companies are struggling with its

accelerating pace. Everything around them

seems to be changing faster than they can. As one U.S. CEO told us,

“We are successful, but slow.”


0% 20% 40% 60% 80% 100%

Socialresponsibility

Ability toadapt

Brand andReputation

Key Talent

Not at all

Not very

Important

Critical

CEOs: Keys to Competitiveness

How important are the following sources of competitive advantage in sustaining your growth over the long term?


CEOs Need a Paddle

Suddenly everything is important. And change can come from anywhere.

CEOs find themselves – as one CEO put it – in a “white-water world.”


0% 20% 40% 60% 80% 100%

Low-CostCompetition

Key Skills

Over-Regulation

EconomicDownturn

Not at all

Not very

Important

Critical

CEOs: Threats on the Radar

How concerned are you about the following threats in relation to your business growth prospects?


0% 20% 40% 60% 80% 100%

NGOs

Media

LocalCommunities

Employees

Governmentand Regulators

Customers andClients

Weaker now

Stayed the same

Stronger now

CEOs: Growing Influence

To what extent has the influence of stakeholders who influence your decisions about the success of your business in the future, changed in the past three years?


0% 10% 20% 30% 40% 50% 60% 70%

No Impact

Negative

Positive

CEOs: Impact of CSR

CEOs are generally positive about the impact of rising corporate social responsibility expectations.


Why PR “Doesn’t Get It”

Perceived as focusing on the “wrong things” We come across as wanting to be everyone’s

friend The families of the victims want answers Don’t want to leave a reporter hanging Don’t want our neighbors to be mad Employees are glum

We shy away from numbers

The Art of Giving Advice

Be positiveEliminate criticismUrge prompt actionFocus on outcomesBe an incrementalistBe pragmaticBe a strategic force

- James Lukaszewski, http://www.e911.com/monos/articles/article-leader-to-leader-fall-2008.pdf

Case Study: Baby Seat Maker

Millions soldCustomers injuredCEO blamed the

parentsPR’s role: negotiated

terms of recall

Case Study: Pharma

Made compounds for doctors nationwide

Patients died CEO argued that doctors,

patients and the coroner may have erred

PR’s role: apology and process improvements

Case Study: Retail

Respected college town retailer

Sued by university for trademark infringement

CEO attacked judge’s character

PR’s role: get students involved

Summary

The CEO: PR is a comb over

To be an equal, think like onePlan aheadSeek the truthSpeak the truthStrengthen your

relationship now

Questions/Discussion

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crisis and the ceo

Business

crisis plan

crisis response team

agenda crisis fundamentals

plan simple

rapid response

process of planning

customers government

federal regulators