Author: Jonathan & Erik Bernstein

When lawyers write the corporate apology

Editor’s Note: The following guest article by crisis management pro Tony Jaques is the perfect companion to Jerry Brown’s post, “Skip the Spin,” which you can find on the Bernstein Crisis Management blog. Combined, they present a powerful statement on the dangers that emerge when we indulge the temptation to spin the truth.

It was another one of those “what were they thinking” moments. For more than 50 years the German makers of Thalidomide, Greunenthal, remained silent about the ten thousand plus babies born with severe deformities after their mothers took the morning-sickness drug.

In an extraordinary move, Harald Stock, CEO of Greunenthal, then rather bizarrely chose the unveiling of a statue symbolising a child born without limbs erected at the company’s German headquarters to issue what the BBC called the drug-maker’s first apology in 50 years.

It was a critical moment in a prolonged crisis. But the company statement showed every sign of having been carefully crafted by lawyers concerned more with legal liability than compassion.

“We ask for forgiveness that for nearly 50 years we didn’t find a way of reaching out to you from human being to human being,” Mr Stock said.

“We ask that you regard our long silence as a sign of the shock that your fate caused in us.

“We wish that the thalidomide tragedy had never happened. We see both the physical hardship and the emotional stress that the affected, their families and particularly their mothers, had to suffer because of thalidomide and still have to endure day by day.”

It was statement sure to annoy and certain not to satisfy, especially when the company restated its long-held position that damage to unborn fetuses could not be detected by tests carried out before thalidomide was marketed from 1953 to 1961.

British Thalidomide campaigners called the statement insulting and insincere, and declared that an apology should also admit wrongdoing. And from a strategic perspective one obvious question is why the company made the statement at all.

The most telling response probably came from Australian mother Wendy Rowe, whose daughter Lynne recently received a multi-million payout from distributor Diageo.

“It’s the sort of apology you give when you’re not really sorry,” she said.

“I suspect he (Mr. Stock) might not know what shock is. Shock is having your precious child born without arms and legs. It’s accepting that your child is not going to have the life that you wanted for her.”

“Our family couldn’t have gone into silent shock. We had to get up and face each and every day and cope with the incredible damage that Gruenenthal had done to Lynne and our family.”

Mrs Rowe’s eloquent statement should stand as a reminder to corporate communicators and lawyers that apologies should actually be apologetic.

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For more resources, see the Free Management Library topic: Crisis Management
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Tony Jaques manages an Australian-based issue and crisis management consultancy and writes the regular newsletter Managing Outcomes

Antibiotic-resistant bacteria raise deadly crisis management questions

There is no arguing the fact that modern medicine is saving lives every day. Unfortunately, there is also a downside. By making the use of certain medications, specifically antibiotics, extremely prevalent, we are creating new and deadly “superbugs” that threaten to wreak havoc on unsuspecting hospital patients.

Think we’re exaggerating? You won’t after you read this quote discussing the intense measures taken by staff at a National Institute of Health Clinical Center in 2011, from a Washington Post article by Brian Vastag:

As a deadly infection, untreatable by nearly every antibiotic, spread through the National Institutes of Health’s Clinical Center last year, the staff resorted to extreme measures. They built a wall to isolate patients, gassed rooms with vaporized disinfectant and even ripped out plumbing. They eventually used rectal swabs to test every patient in the 234-bed hospital.

Still, for six months, as physicians fought to save the infected, the bacteria spread, eventually reaching 17 gravely ill patients. Eleven died, six from bloodstream superbug infections.

What’s even more frightening is the fact that the NIH kept the outbreak under wraps for nearly a year, finally releasing not an apology, but a scientific paper detailing the methods used to track the movement of the superbug Klebisella pneumoniae. Apparently, CDC rules do not require mandated reports on this particular bug, and the NIH chose to throw its moral obligations out the window and stay mum.

This outbreak was certainly not the only one of its kind. Hospitals across the country have been encountering strains of bacteria that simply do not respond to antibiotics for more than a decade. Reality is, a threat of this measure is something that simply cannot be managed properly without prior crisis management planning covering both operational and communications response. Every medical facility, be it hospital, nursing home, or pediatrician’s office, absolutely must prepare for a superbug outbreak. Because of the often large number of employees and numerous complex procedures already in place, this is a crisis that begs to be simulated and have its response practiced regularly and thoroughly. Lives, quite literally, hang in the balance.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

President takes to Reddit for online reputation management

First we saw the Navy’s excellent social media program surface, then the Air Force’s savvy soared into the public eye. Now, the Commander in Chief himself has joined the party!

Yesterday, a thread popped up in Reddit.com’s “I am a…Ask me Anything” Q&A section titled, “I am Barack Obama, President of the United States — AMA.” Now Reddit users are a skeptical bunch by nature, but the fact that the post was both tagged as verified by moderators and included a pic of President Obama manning a laptop was proof enough to bring visitors pouring in. Within minutes, Reddit, no stranger to high traffic, had crashed from the sheer volume of users attempting to reach Barack’s AMA, but in the end he was able to answer ten questions that ranged in topic from the White House’s new beer and what his favorite basketball player is (Jordan, btw), to Internet freedom, perks for small business and ways to help college grads get on their feet.

Not only did Obama come off as personable, intelligent, and passionate through what I must assume was heavy vetting of posts by White House staffers, but his team also put together a special site just for the event, www.BarackObama.com/reddit that seamlessly blended the ever-present (at least on Reddit) meme with a political call-to-action. With just short of 24,000 comments, the vast majority either positive or voicing calm, intelligent dissent, in response to a very brief Q&A session, we would call this one a groundbreaking success in online reputation management for the office of the President.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

In this week’s episode of The Crisis Show, hosts Jonathan Bernstein, Rich Klein, and Melissa Agnes covered crises that ran the gamut, from panic over new West Nile outbreaks and food recalls to social media blunders by Progressive and several U.S. universities. You can always rely on the wide world of sports for some reputation issues, and both the New York Giants and Melky Cabrera provided us with yet more fodder. The #CrisisFail of the week came courtesy of Rep. Todd Akin, who got himself in trouble with his “legitimate rape” comment and just dug a deeper hole with a careless response.

The special guest for this episode was Karen Freberg, assistant professor in Strategic Communications at the University of Louisville and adjunct faculty member for West Virginia University.

If you can’t catch The Crisis Show when it airs live on Wednesdays at 4 PST/7 EST, all of past episodes are available on our YouTube channel.

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For more resources, see the Free Management Library topic: Crisis Management
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How one student shamed his district

Breaking into their school’s computer database isn’t usually a sign of a good student, but when senior Jacob Bigham used a teacher’s password to gain access to Troy High’s records, it wasn’t to change grades or cause mischief. Rather, Bigham was on the hunt for the vote count from the recent student elections in order to determine whether he had really lost the election for the student government vice-presidency at the Fullerton school.

Reporter Scott Martindale, reporter for local newspaper the OC Register, described Bigham’s find, as well as the result of his revelation:

Bigham revealed in April that the candidates whom student-government faculty adviser Jenny Redmond named as student-body president and vice president for 2012-13 weren’t the top vote-getters. He also confessed that he used a faculty password to break into a Web-based school database from his home computer.

 

Bigham was immediately suspended for five days, stripped of his current post as student-body secretary and barred from assuming the student-body vice presidency he’d won for 2012-13. Redmond continued teaching the student-government class for the remainder of the school year.

The story doesn’t end there though. The OC Register had taken notice of the controversy, and the interest of the media quickly drew in district bigwigs, who announced an investigation, then clammed up, giving plenty of time for damaging rumor and innuendo to fly.

The result of the investigation? The district decided that “some Troy staffers had been under the mistaken belief that Troy’s student-government constitution granted administrators the unilateral authority to alter the results of student voting.”

The fact that this statement like this was actually released shows the sheer lack of crisis management training among Fullerton district leadership. Because anyone with half a brain knows that nobody is supposed to tamper with election results, the statement begs the question, are the faculty members involved really that dumb, or is the whole system corrupt?

Either way, Troy High and the Fullerton school district have lost the trust and respect of their students and community at large.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

Ignoring basic crisis management isn’t a good sign

Rupert Murdoch’s News Corporation has launched a review of anti-corruption controls in several of its publishing arms, including News International in London.

Murdoch told News Corp staff in a memo on Wednesday that the company recently launched the probe as a “forward-looking review” to improve compliance with bribery laws.

The media tycoon told staff that the anti-corruption review was “not based on any suspicion of wrongdoing by any particular business unit or its personnel”.

This quote, from a Guardian article by Josh Halliday, is proof that Rupert Murdoch really hasn’t learned much from his failed crisis management for the multiple ethics and corruption scandals that continue to rock his media empire. In seeking to deny the painfully obvious link between a company already proven to be deeply corrupted and a major anti-corruption review, Murdoch refuses to stick to one of the tenets of Crisis Management 101: transparency and honesty are key. With 20+ News Corp staffers arrested already by UK police, it’s clear that there was shady business going on, so why deny that you’re cleaning up? It makes no sense.

It seems Murdoch has learned one thing…the Guardian article also had this “hindsight is 20/20” statement to share:

Murdoch said the strengthening of News Corp’s compliance procedures will take time and resources, but added that the cost of non-compliance are far more serious.

You’d better believe that! The scandal at News Corp has already cost the company some $315 million, and with the trouble continuing to roll in I’d hope Murdoch has permanently hired the best compliance team money can buy. It would be a wise investment, if he kept them on for the rest of their lives it wouldn’t scratch that total!

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

This week, The Crisis Show hosted a special “Back to School” episode. To help, we had guests Karen Freberg, assistant professor in Strategic Communications at the University of Louiseville and an adjunct faculty member for West Virginia University, Gail Glover, Senior Director of Media and Public Relations at Binghamton University and Phillip Lentz, Director of Public Affairs at New York University.

That trio brought a wealth of experience to the table, and there was some serious discussion of recent crises in schools, as well as some brilliant new work that’s being done at universities around the country.

If you can’t catch The Crisis Show when it airs live, Wednesday at 4 PST/7 EST, all of past episodes are available on our YouTube channel.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

Sarcasm becomes reality for Travelocity

The old, sardonic phrase “no good deed goes unpunished” isn’t exactly true. Doing good for your stakeholders is a great way to sink roots into your community and grow your reputation. The lesson that Travelocity should learn from its latest social media misstep is that “no incautious good deed goes unpunished.”

Travelocity set out with all the right intentions. Speaking at a conference for the National Federation of the Blind, Senior VP of Travelocity’s global strategy and project innovation promoted the company’s new vision-impaired-friendly website, and offered attendees a $200 discount on their next booking.

Things started to get out of control when the NFB shared (and Travelocity RT’d) the code for the discount via Twitter, but forgot to stipulate that it was for attendees only. Unfortunately for Travelocity, there are several million people on Twitter that weren’t at that conference, and quite a few of them thought they would go ahead and use the discount code themselves. The situation got even worse when several other travel sites across the ‘net picked up the code, but without the qualifying text, leading many buyers to believe it was a public discount.

In a US News and World Report article by Danielle Kurtzleben, BCM president Jonathan Bernstein shared his thoughts on the use of online media to push proactive work:

“Mass media online has dramatically increased the need for thought and planning before you do any proactive work,” says Jonathan Bernstein, president of Bernstein Crisis Management, a California-based consulting firm. “Something can go viral in minutes, and unless you are a) monitoring it very closely to catch those things and try to respond very quickly and b) have an infrastructure to respond quickly, you can quickly get overwhelmed.”

Travelocity had neither, and it was only after several days that a spike in use of the coupon code was spotted, leading the company to cancel the discounted reservations that were not attributed to NFB conference attendees. The company made another mistake when it sent out letters stating that full cancellation fees would be charged for those who used the coupon erroneously, and only retracted that statement after a flood of furious stakeholders took to Facebook and Twitter to voice their complaints.

The NFB’s PR director spoke out in support of Travelocity, but the damage was done. Will this break Travelocity? No. The company is successful and generally well-liked. Has this incident created a weak spot in the company’s reputation that could lead to major problems if such a mistake is made again? Absolutely. We’d bet good money that Travelocity has already made changes to its social media policy, and will be curious to see when it ventures into this arena next.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

Technology outpaces security

Let’s assume (against the odds) that you’ve been thorough about online password security. You don’t use common garbage passwords like 1234, qwerty, or your birthday, you make sure not to share the same passes between accounts, and your security questions have answers that aren’t in the public domain. That means that your web accounts, which hold everything from irreplaceable family pictures to highly classified corporate documents, are safe, doesn’t it?

Not even close. For those who are unfamiliar with how computer hacking works, a surprising amount does not involve any actual computer work, but rather social engineering – the art of manipulating people into performing actions or divulging confidential information. For example, check out this quote from a Wired article by Mat Honan that details how a pair of hackers took control of his Amazon account, several Apple devices, and email/social media accounts using just his email, billing address, and the last four digits of his credit card, by exploiting an overlap of information between Apple and Amazon’s tech support systems.

Apple tech support gave the hackers access to my iCloud account. Amazon tech support gave them the ability to see a piece of information — a partial credit card number — that Apple used to release information. In short, the very four digits that Amazon considers unimportant enough to display in the clear on the web are precisely the same ones that Apple considers secure enough to perform identity verification. The disconnect exposes flaws in data management policies endemic to the entire technology industry, and points to a looming nightmare as we enter the era of cloud computing and connected devices.

These days everything is going on the cloud. Problem is, the very same technology that makes it simple for us to work and play from any device, anywhere, also creates massive new crisis management risks. Currently, cloud computing and the sheer level of interconnectedness pushed by major social media sites and online retailers has simply outpaced web security and the reality is that if a hacker wants your information and has a decent level of skill, or even just a silver tongue, it’s probably theirs.

Everyone should assume that they will be hacked at some point, and formulate a plan to make it have as little impact as possible. Constantly back up ANYTHING that you’d be upset to lose. If you’ve got confidendential information, store and back up to a computer that’s not shared on your cloud network. If you absolutely must have it easily accessible, use an encryption tool (several good ones are actually available free) to enhance security.

At the same time, businesses like Apple and Amazon need to work together to eliminate security flaws like that one that exposed Mat Honan’s life to the whims of two teenage hackers out to get some e-fame. Regardless of the fact that they are separate entities, allowing information from one to unlock access to the other is a HUGE issue that greatly undermines consumer faith. If you think you’ve finally got your systems secure, try bringing in a “white hat” hacker. These are security experts, many of whom dabbled in the dark side during their younger days, who specialize in getting into your system, then telling you how they did it.

After hearing how Mat was hacked, Wired staffers set about to repeat the process, and following a few phone calls were able to take complete control of another linked set of Apple and Amazon accounts. Frightening, and real. Be prepared.

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For more resources, see the Free Management Library topic: Crisis Management
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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training, and co-host of The Crisis Show. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]

Sick worker triggers health alert for salad bar

[Editor’s note: We’re pleased to bring you another guest article from crisis consultant and frequent contributor Tony Jaques]

When hepatitis A was discovered in a worker at Sydney fresh salad bar SumoSalad, the company initially did some things well, but they also made some crucial errors in crisis communication.

It was a nightmare scenario for any food company, and even more so for SumoSalad, which sells itself as “the healthiest fast food franchise.”

On August 1, the New South Wales Ministry of Health issued a health warning for anyone who had eaten at the chain’s central Sydney store, where a worker had been diagnosed with hepatitis A after a visit to Indonesia.

The health authority said customers at the salad bar over a two week period might have been exposed to the disease and recommended that some of them may need a hepatitis A vaccination, while for others it was too late.

In a brief statement on the SumoSalad website, CEO Luke Baylis said it was an isolated incident at just one store and he emphasised that during a review the NSW Food Authority had acknowledged that the company was compliant with all food safety regulations and determined there was no further risk of infection.

It was a classic response and, apart from the fact that the statement was posted a day AFTER the government warning, the CEO was doing some things well.

He issued the statement in his own name and provided his personal mobile phone number rather than hiding behind a PR spokesperson. He also made sure that all medical opinion was attributed to independent experts. However, nowhere in his statement or subsequent reported interviews did he say he was sorry or express sympathy for his customers.

The Ministry statement had described the risk of infection as ”probably low” but in an interview with the Sydney Morning Herald the CEO seemingly thought that was no longer good enough. “While she (the staff member) was working in the store she wore gloves at all times, so there is a very, very miniscule possibility that anyone could have contracted the virus.” That may have been his non-expert opinion, but does not seem wise at the same time as medical authorities were urging people to get vaccinated as soon as possible.

In his formal statement the CEO had said customer safety was his highest priority, but he appeared reluctant to express any sympathy for clients at the salad bar who were frightened they may have been exposed to a serious illness.

In fact in a subsequent interview with the business website Smart Company his focus was defensive and almost entirely focused on his concern about his brand rather than his customers.

It was a situation that is not created by employer negligence, Mr. Baylis said, and he added that the franchise would have to work hard to counter the inevitable brand damage that had already occurred through reports of the infection.

“This will be damaging for our brand, but we hope people will see the lengths SumoSalad has gone to in order to assure our customers’ safety.”

Stating the blindingly obvious in the midst of a corporate crisis was less than helpful, and served only to reinforce that his main concern was to “manage the damage of the situation.”

It seems the benefits of the original calm, planned strategy were soon overcome by the CEO’s enthusiasm to keep talking and go off message.

As he optimistically told Smart Company: “We hope that our customers will look at this as a positive, but there are certain people that will take a negative approach to this and will be skeptical”

Really, Mr. Baylis? You think? Maybe that extraordinary statement sounded better inside your head than in cold, hard print.

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For more resources, see the Free Management Library topic: Crisis Management
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Tony Jaques is Director of Issue Outcomes, a full-service crisis management firm serving clients across PanAsia.