Insignia Talks

…about the power of communication to create, manage and protect reputations

No one seriously doubts the tangible value of reputation in meeting business objectives.  Insignia’s belief is that purposeful communication is the fuel which powers a valuable corporate reputation.  Purposeful communication to create the reputation in the first place.  Purposeful communication to support and drive business objectives as the company grows and navigates through the ever-changing issues landscape.  Purposeful communication to protect the business through effective crisis management in the heat of a major incident.

Insignia hates wasted or random communication – lots of noise, but little actual impact.  We believe that the best communication is focused, thoughtful and purpose-built to deliver against business imperatives.  This is achieved by always asking “why?” before considering “how”.

Insignia believes that pro-active reputation management unlocks reputational value hidden within a business and to achieve competitive advantage.  We also know that valuable reputations are at serious risk through insufficient preparation for potential crises or issues.

Insignia was founded by people with years of experience working with leading communication agencies for global businesses, united by a desire to unleash the power of communication to protect and maximise the value of corporate reputation.

Jonathan Hemus
www.insigniacomms.com

When LA Fitness threatened to enforce its contract with a heavily pregnant woman who had fallen on hard times, it may have had the letter of the law on its side.  But once the story became public, it was found guilty in the court of public opinion.

LA Fitness is just the latest business to find out that protecting reputation means doing the right thing in the eyes of the outside world, not simply complying with regulations or the law.

Ten years ago, LA Fitness’s dispute with a customer over whether her gym contract could be enforced would have been a private customer service issue in which the company held the balance of power.  Today it requires crisis management skills, is conducted in public and public opinion has far greater influence.

This transparency needs to be understood by businesses and factored into their behaviour, decision-making and communication. The imperative to act in a way that matches the  expectations of external stakeholders is largely driven by the power of social media.  In the old days, customer complaints could be dealt with in private and media criticism dismissed as tomorrow’s fish and chip paper.  Today, because of Twitter, Tripadvisor, Google et al, customer service – and crisis management – has become a spectator sport.  Worse, the spectators actually influence the game.  Whether businesses like it or not, this is the reality.

This transparency has raised the bar in terms of ethical and acceptable corporate behaviour – it’s much harder to do bad things and simply get away with it (which, of course, is a good thing).  It also means that the need for thorough crisis  management planning is more pressing than ever: reputational risk assessment, social media monitoring, scenario planning and realistic social media simulations should all form part of this.  A slow or inappropriate response to a crisis will be punished with damage to reputation.

LA Fitness appeared to be forced into a u-turn, and  this never looks good.  Ultimately, the key for businesses is to control the crisis rather than let the crisis control them.  Being able to perceive a crisis from the outside in and acting quickly and appropriately when company behaviour clashes with public expectations is essential to preserve corporate reputation.

Jonathan Hemus

www.insigniacomms.com

As I glanced through the statement issued by Costa Cruises in the wake of the dreadful Costa Concordia accident, I noticed how it ticked the golden rules for crisis communication: concern and empathy for human life in para one; actions to address the situation in para two; messages about minimisation of environmental impact in para three.

So far, so good.  And then, in para four, I read this:

“preliminary indications are that there may have been significant human error on the part of the ship’s Master, Captain Francesco Schettino, which resulted in these grave consequences”

It is the earliest and most explicit attempt to blame an employee for an incident that I have ever seen, and at best, I view it as an extremely high risk crisis management strategy.

Here’s why:

• it creates the impression of a business willing to jump to conclusions before all the facts are known, rather than keeping a cool head
• it infers that the business’s top priority is protecting its own commercial interests and will use any means to do this, rather than focusing all attention on the human impact at this early stage
• it implies a separation between company and employee which could be seen as artificial
• it portrays an unflattering picture of a large business prepared to cast an individual employee adrift when the going gets tough
• it creates further fuel for an extended crisis – controversy – as the captain denies the accusations

And what if investigations conclude that the captain was not to blame?  In this situation, Costa Cruise’s early pronouncement would be hugely damaging to reputation.

Effective crisis  management is of course about using all means at your disposal to protect corporate reputation.  But that doesn’t mean applying the most expedient and pragmatic message without careful thought. Statements and pronouncements from media spokespeople must be delivered with a clear understanding of not just the immediate term impact, but also how the business wants to be regarded a year later.

As a final point, history shows that businesses which pin crises on “human error” have frequently created the conditions in which human error is likely: insufficient training, a culture of profit before safety or an environment in which front-line employees are afraid to voice concerns, are all conditions which make a “human error” much more likely.

So, even if Costa Cruise’s allegation turns out to be true, it may still not be enough to protect its reputation.

Jonathan Hemus

www.insigniacomms.com

Concerns and coverage about potentially faulty breast implants produced by French company Poly Implant Prothese (PIP) continue more than two weeks after the story first broke.  This is a long time for a crisis to be in the media spotlight and indicates that crisis communication has been sub-optimal at best.

Indeed, a statement from the Independent Healthcare Advisory Services, the trade body which represents private clinics, accuses the government of communicating in a way which leaves people “feeling more confused and anxious now than before”.  It’s another reminder that effective crisis communication is essential when people are concerned for their health.

Women have been bombarded with mixed messages, which only increase their worries. While the UK authorities assert that there is no need to remove implants, countries such as France, Venezuela, Germany and Czech Republic have suggested that women have their implants removed as precautionary measures. According to the Lancet Medical Journal, it is ‘quite literally incredible’ for UK health officials to expect women not to worry.

The communication problem has been further exacerbated by the many and varied media spokespeople who have appeared on our televisions and radios over the last few weeks.  Everyone from the Medicines and Healthcare products Regulatory Agency (MHRA) through to individual cosmetic surgeons, trade associations, agony aunts, celebrities, government and patients have had their say.

So what makes for an effective media spokesperson during a health scare? We investigated this subject a couple of years back when, together with the University of Wolverhampton, we conducted research into swine flu communication. We looked at a range of spokespeople and used focus groups to assess their effectiveness and the reasons for their success – or lack of it.

The research clearly showed that high profile spokespeople have enormous power to reassure and inform the public in the event of a health scare.  Equally, they have the ability to cause unnecessary confusion, distress and concern if they fail to communicate effectively.  They need to recognise that this position of power also brings with it responsibility

We also identified the personal ingredients which defined a successful spokesperson at the time of a health scare.  Expressed as an equation, they are:

CS + SA + PA + AA = Reassurance (where CS is Credible Spokesperson, SA is Serious Appearance, PA is Personable Approach and AA is Actionable Advice)

Equally, credible spokespeople – doctors, scientists, academics – who provide worrying insights without clear and actionable advice can cause significant public anxiety. Given the impact that this communication has on the public, there’s a strong case for saying that people who are unable to match up to this set of criteria should not be put in front of the media during a major health scare.

Media training can help to identify whether a spokesperson is up the job or not, but also requires the potential commentator to be honest with themselves about their capabilities – or have a colleague who’s sufficiently honest and courageous to tell them the truth.

Having the ability to communicate effectively with the media is important at all times, but when your communication skills can affect the decisions someone makes about their health, I’d suggest it’s essential.

Jonathan Hemus

www.insigniacomms.com

Premier Foods is not the first food manufacturer to undertake a product recall following a food poisoning scare, and it will not be the last.   But its recall of Loyd Grossman korma sauce carries the potential for greater damage and more crisis communication challenges than most other recalls for two reasons.

Firstly, the fact that the Loyd Grossman brand is based upon a well known personality adds to the company’s crisis management challenge.  Any product recall with a potential health impact has the power to attract media and public interest. Add to it a celebrity angle and media attention is likely to significantly increase.  Not only that, but the celeb in question will be seeking to protect their own brand image, and your crisis communication objectives may not necessarily align.  As a consequence,  planning for the potential downside of any celebrity association needs to be a part of any brand’s reputational risk assessment.

Secondly, Premier Brand’s own business health makes it vulnerable to a mis-handled crisis.  Organisations with a positive reputation and a strong business can emerge from a crisis with their reputation intact, assuming they mange the incident well.  Organisations which enter a crisis with pre-existing business problems, financial question marks or a less than glowing reputation, can be brought to their knees (and beyond) by a mis-handled crisis. Pan Am is a prime example: it was already a troubled business before Lockerbie but its mis-handling of that crisis was enough to seal its fate.

Premier Foods seems to be managing its crisis well: given the circumstances, it needs to.

Jonathan Hemus

www.insigniacomms.com

Blackberry looks set to once again prove the crisis communication adage that it’s not really the crisis which damages reputation, it’s the way in which you respond to it.

On this basis, Blackberry is set to suffer major harm to its reputation (and its business fortunes)  based on a tight-lipped approach to communication and a failure to use social media to communicate its response to the current problems.  Gordon MacMillan’s blog posting on The Wall sums it up perfectly for me – it’s well worth a read: I’ll simply say that I endorse every word and would also add the following.

Swift crisis communication

Any organisation which wants to protect its  reputation in a crisis must be geared up to communicate quickly and expansively in the event of an incident.  For most organisations that must include social media: it’s where the crisis plays out, it’s where customers go to seek information and vent their spleen, it’s where the media turns for information.  And it’s where businesses can quickly exert influence over the communication agenda, and listen and respond to the concerns of its stakeholders.

Social media in crisis communication

In today’s online world, I would contend that even an organisation without a consumer face should have the ability to utilise social media in the event of a crisis.  But if you’re a consumer brand (which Blackberry has chosen to become) you certainly should have this capability.  Moreover, if you’re a  consumer brand in the telecoms space whose devices facilitate communication by social media, I find it truly staggering that you would ignore these channels when your reputation is on the line.

Not only does it go against the guiding principles of effective crisis communication, but it also calls into question whether the Blackberry brand really is at the heart of social media (and therefore the consumer landscape), or not.

Crisis management training

Organisations at the leading edge of  reputation protection have already integrated social media into their crisis communication planning and are running realistic crisis exercises with social media as a core element.  All businesses need to embrace this approach – and quickly – or else risk being overwhelmed by the kind of crisis communication challenge currently facing Blackberry.

Update: 15.20 13 October

Blackberry has now begun the social media fightback with a YouTube video apology from CEO Mike Laziridis in which he admits “we’ve let you down” and commits to more pro-active communication.  Its content, tone and messages are spot on.  But at least 48 hours too late.

Jonathan Hemus

www.insigniacomms.com

Recent experience demonstrates that major incidents unfold under the unswerving gaze of 24 hour news media so it’s essential that businesses vulnerable to on-site incidents have planned their crisis communication to cope with the arrival of a media pack.

Here are five key questions to address ahead of a potential media invasion:

• Who will be your media spokesperson?
• Who is their deputy if they’re unavailable?
• Where will you conduct press conferences at key sites? (and what’s the alternative venue if your first choice is inaccessible?)
• Where will the media congregate as the crisis unfolds and how will you manage their presence?
• How will you brief employees on guidelines for inter-acting with the media and what will the guidance be?

Dealing with a major accident is hard enough.  Making sure that you have prepared beforehand for wall to wall media interest will allow you to focus all attention on the most important task, attending to the incident itself.

Jonathan Hemus

www.insigniacomms.com

With news that a “rogue trader” is responsible for a $2 billion loss, it is clear that Swiss bank UBS faces a huge crisis communication challenge.  A number of factors make this challenge even tougher than might otherwise be the case.

Preserving UBS’s reputation

Reports that the unauthorised trading was not picked up by UBS’s internal controls could suggest that the real crisis communication challenge centres not on the $2 billion loss, but in preserving the organisation’s reputation as a well managed, secure and professional operation.  These qualities need to be at the heart of any bank’s reputation and so any crisis which indicates their absence poses a major threat.

A lack of credit in the bank

A stock of reputational goodwill can be enormously valuable in a crisis: this can be built up with the right actions, relationship-building and pro-active communication ahead of time.  Unfortunately, UBS has a rather low stock of reputational credit currently.   Recent losses on toxic assets, a tax evasion dispute in the US and job cuts all contribute to an organisation which is low on reputational capital.  This is an unhelpful context from which to engage in crisis communication and protect reputation.

Tight-lipped communication

UBS has been extremely guarded in its crisis communication response with its most visible  presence being a 63 word statement about the issue on its website.  Others have been less tight-lipped. Ratings agencies, academics, journalists, financial analysts and other commentators have been quick to fill the vacuum.  Whilst this is undoubtedly a complex situation and the presence of lawyers will loom large, in a crisis of this magnitude, it is rarely the right strategy to stay so quiet.

Pro-active crisis communication required

The crisis poses a major challenge for UBS and threatens serious damage to its reputation and long term business (its shares dropped by 11% on the day that the news broke).   A pro-active approach to crisis communication may not be enough to fully preserve UBS’s reputational value, but I firmly believe that without it, the damage will be much more severe.

Jonathan Hemus

www.insigniacomms.com

One of the main sub-stories of the August riots was the use of social media in inciting and organising rioters as they took to the streets.  Some commentators even called for social media to be “turned off”.

Now, whilst it’s clear that social media can indeed contribute to the escalation and spread of a crisis situation, it’s even more powerful as a crisis communication solution. That’s why I was so heartened to read a blog posting from Superintendent Mark Payne of West Midlands Police with his views on the subject.  I’d recommend you read his entire posting, but for now, consider these excerpts:

• One thing that we have seen over and over again during emergency situations is that where there is no information coming from the authorities, the gap will be plugged by speculation
• The very clear message is that people were reassured by following my feed, and believed it rather than all of the rumours that were flying about on the day
• If you use social media on a day to day basis, people start to trust your voice, and they are much more likely to turn to you for information in a crisis

It seems clear to me that these are crisis communication lessons not just for the police force, but for corporate communicators too.  Anyone in the business of reputation protection should be paying full attention to the impact of social media, and planning for its use in crisis management.  Applying the principles suggested by Superintendant Payne would be a very good start.

Jonathan Hemus

www.insigniacomms.com

If you heard that your regular painkiller could have been replaced with antipsychotic drugs instead, you might be a little concerned.  So concerned that you might want a little more information to put your mind at rest. 

That is the scenario facing purchasers of Nurofen Plus following an announcement from the Medicines and Healthcare Regulatory Agency (MHRA) that some packs contain not the expected Ibuprofen, but Seroquel XL, an antipsychotic drug used to treat conditions such as schizophrenia.

Go to the Nurofen website and there appears to be no information about the incident.  Move on to Nurofen’s Facebook page and there’s a great quiz, but no information about the product contamination.  Turn to the website of Reckitt Benckiser and still you won’t find any advice from Nurofen or its parent company. 

So, instead, you pick up the phone and call the consumer helpline listed on the Nurofen website. Unfortunately, news of  the incident hit the BBC around 6pm and the helpline shut at 5pm.

Businesses which want to reassure their customers and retain their loyalty during and after a crisis need to communicate with them.  That means being geared up to communicate via company websites and social media.  It means having the capability to man your customer helpline 24/7 if necessary.  Failing to do this leaves customers in the dark, potentially fearful and with your reputation in the hands of the commentators who are prepared to provide information.  It’s a high risk crisis communication strategy.

Update

Twelve hours later and a terse statement is now available on the Nurofen website, but it contains little information or reassurance.  At 8.06am the customer helpline is still closed and people are beginning to post to the Nurofen Facebook page, for example “Never mind the competitions , what about informing the public of the anti-depressants found in your packs?”.  No information about the problem can be found on Nurofen’s Facebook page.  People are also making their views known on Twitter.  More expansive crisis communication would surely be in Nurofen’s best interests?

Update 2 (26 Aug)

Nurofen has now announced a recall of all stock in retail outlets: a more expansive communication approach is now surely essential.

Jonathan Hemus

www.insigniacomms.com

For a country whose econony relies on tourism, there’s no bigger crisis communication challenge than dealing with a fatal shark attack.  So it’s little wonder that the Seychelles’ crisis media spokesperson, tourism chief Alain St Ange, sounded under pressure when conducting media interviews about the death of British tourist Ian Redmond.

What is surprising though is that he should have made so many fundamental and damaging mistakes in the way he handled his media interviews.  A thorough reputational risk assessment should identify the crisis scenarios capable of seriously damaging a reputation so that thorough crisis communication training and planning can take place ahead of  a possible crisis event.  Either a shark attack had not been identified as a potential risk (a serious oversight) or insufficient crisis media training had taken place to identify and prepare a spokesperson to deal with such an event.

So where exactly did Mr St Ange go wrong?  Listen to this early BBC interview which illustrates the following errors:

1) Inappropriate balance between messages about the victim versus messages about the Seychelles

Whilst Mr St Ange expresses sympathy for the victim and his family, this is out-weighed by messages focused inwardly on the Seychelles.  This smacks of self-interest and self-justification.  He twice describes the country as being “innocent” as though apportioning (or avoiding) blame is the priority at this stage.  More than this, his attempt to position the attacker as a “foreign shark”  and by inference not the responsibility of the Seychelles, stretches credulity.  The impression created – rightly or wrongly – is that the spokesperson cares more about the impact on business in the Seychelles than the human tragedy.  In other words, the exact opposite of what he should be communicating.

2) Inappropriate tone of  voice

It’s not just what you say, it’s how you say it.  Mr St Ange fails to convincingly communicate compassion in his tone of voice.  Instead, he sounds business-like, matter of fact and slightly brusque.  The impression is  of someone slightly irritated that he is having to deal with a problem (and the media), rather than someone who cares deeply about what has happened.  Some may argue that the fact he is not a native English speaker is a key factor in his vocal delivery.  I say that’s not good enough: when your reputation is on the line, you cannot afford to field a spokesperson who is unable to create the right perceptions among viewers and listeners.  Crisis communication training is essential to identify and enahnce the skills of your crisis spokespeople

In this later clip, again featuring Alain St Ange, a further problem arises:

3) Poor preparation leads to unwanted headlines

Mr St Ange continues to defend the actions taken by the Seychelles to protect tourists, but in an apparently throw away remark – again communicated in a casual tone of voice - he concedes “we did try, but maybe not enough”.  Guess what the headlines were after this interview?  Almost universally, along the lines of “Seychelles tourism chief admits we could have done more”.  My criticism is not so much the message itself – acknowledging mistakes and committing to address them can be a very powerful and engaging message – more that it appeared to emerge in an unplanned way.  More than this, it seemed to conflict with earlier messages which sought to distance the Seychelles from blame.  To be successful, crisis spokespeople must know exactly want they want to communicate in a media interview and be pro-active in getting those messages across.  Consistency of message is crucial: media interest in crises can be sustained much longer in the event of mixed or conflicting messages.

The role of spokesperson in a crisis carries significant responsibility.  In addition to successfully communicating important information to stakeholders, the impression they create will influence longer term perceptions of the affected organisation.  Choosing the right person for this task, training them properly and providing them with the right messages can make  the differnce between preserving reputation, and seeing it severely damaged.

Jonathan Hemus

www.insigniacomms.com