Showing posts with label case study. Show all posts
Showing posts with label case study. Show all posts

Wednesday, January 25

Loving It Too Much: The McDonald's Campaign Backfire

In recent years, McDonald's has been making a real effort to change itself from being the flagship of unhealthy fast food to the pinnacle of quick service with healthy choices. The change has been mostly prompted by continuous assaults: Some are are fair. Some are not fair. And some are ridiculous.

The net sum of these varied stories is that the corporate giant is trying to make an admirable change, even if the totality of it continues to be trial and error. Sometimes, they get it right, like adding fruit to choices to the Happy Meal. And sometimes, they get it wrong, like the #McStories campaign.

Why McStories is a beautiful campaign with insidious results.

When I first saw the series of YouTube videos, I almost wrote a post about them. They are beautiful slices of Americana, featuring farmers who take great care in the produce they provide. I love the commercials. But I also hate the commercials.

I don't hate them because of their message or the personalized stories from the farmers. We could use more stories like these, given our country's bout with self-loathing. In fact, that was the reason I decided to pass on critiquing the campaign. The farmers certainly didn't deserve it.

Unfortunately, it was just a matter of time before someone else did. Yesterday, someone did in a tremendously coordinated and catchy fashion. It was only a matter of time before the whole thing went semi-viral. McDonald's has lost Twitter for awhile. It might even lose the entire campaign.

The social media crisis could have been simple enough to spot. The hashtag #McStories, which was meant to support the campaign, was more or less jacked. It was first jacked by PETA and then everyone started piling on with one rancid story about McDonald's after another. #McStories isn't about farmers anymore, at least not for the short term and maybe never.

The attack is no longer confined to Twitter either. It will migrate to other assets. The media coverage of the crisis only attracts more of the same, usually three-fold: people with agendas (like PETA), people with real gripes (like some of the tweet authors), and people who see an easy way to get attention (the attention-starved majority).

McStories is mostly true, but it comes across as a classic overreach. 

If there is one thing advertisers and marketers might take away from the McStories backlash, it's that forcing the marketing message, especially when it is supported by social media, will eventually backfire.

And that's why I hated the campaign. Anybody on the strategy side (because it's too much to ask the creatives to see it) could have seen the backlash coming miles away. Despite many successes, McDonald's house is too dirty to rest its laurels on a handful of true but spectacularly crisp stories.

On McDonald's side, Snopes investigated such beef claims years ago and found them to be mostly true. McDonald's also made progress to be more environmentally friendly, but it tends to miss some goals every year. And then there is always the question about nutrition, especially in terms of carbs, fat, and sodium. All in all, it's one giant hit and miss machine. That's not good enough for a McStories message.

Besides, the problem isn't so much where McDonald's gets its stuff. It's what McDonald's does to this stuff once it leaves the hands of conscientious farmers. It's the processing, recipes, additives, production, freezing, unfreezing, distribution, and in-store preparation that makes you wonder.

Those beautiful cows, lettuce heads, and potatoes are all destined to become something that ages at an impossibly slow pace. And until McDonald's begins to address that fact its operational systems have reached their carrying capacity to deliver the quality I once associated with them, it will continue to face stiff criticism as the the biggest quick service chain.

Personally, I think it's all too bad. McDonald's has plenty to take pride in, ranging from being a massive employer for first-time employees and iconic marketing successes to being a sound investment and a corporation that has blemishes but is trying to do something to clean them up instead of sweeping them aside. However, to make the case that the hamburger joint represents the backbone of family-owned American agriculture in order to deliver near farm-fresh ingredients to consumers ... sigh.

Wednesday, October 12

Saying Whoopsie: Netflix Actions Still Speak Louder

"This means no change: one website, one account, one password ... in other words, no Qwikster." — Reed Hastings 

After several trials and a comedy of errors, CEO Reed Hastings is trying one more time. The message is shorter. The writing is sloppy. But at least people understand what it means: No Qwikster for Netflix.

Qwikster was the proposed solution to accomplish Hastings' long-term goal to completely separate Netflix from the DVD shopping and shipping business. To date, it only accomplished one goal. The restructuring was ridiculous enough that it has all but quelled the alarm over Netflix price increases in July.

Reed was clear about that too. "While the July price change was necessary, we are done with price changes," he said once again. Qwikster, even though the company had already reported it had divided itself into two units, obviously was not necessary. According to some, that makes Qwikster a modern equivalent of New Coke. I don't think so, exactly.

Communicating Change And Price Increases. 

In a few years, assuming Netflix recovers and it probably will, some will ponder whether the price increases and subsequent Qwikster campaign generated publicity and brand awareness that will pay dividends at the bank later.

Maybe it will. Maybe it won't. My take on the whole buzz up is that it didn't have to happen.

Communicating change, even uncomfortable change, is relatively easy. Had Netflix given customers a head start and a better pricing model, it could have raised prices on DVD shopping and shipping and incentivized the move to streaming. The majority of subscribers might have voluntarily switched.

And if the company was serious about skipping out on DVD shopping and shipping, it could have eventually frozen new DVD subscribers some time after the switch. Eventually, the DVD division would have died a quiet and less painful death. No big deal. Netflix knows DVD mail programs are numbered because product purchase and shipping costs are too expensive to make a profit.

Netflix wants to be a streaming service and anybody who doubts it ought to look at its investor relations overview. Nowhere does the description include anything about shipping. On the contrary, the description emphasizes 25 million subscribers over 200 devices. At $8 per subscription, that's $200 million per month without the hassle of pressing discs.

The solution was painfully simple, but overlooked. All Netflix had to do was make its DVD shipping product less attractive over the long haul by making it pay for itself. All the while, it could have been up front and honest with customers that the cost of products and shipping caused the price increases, much like utilities do every year.

At the same time, incentivizing the switch would have made sense because Netflix could probably bank on the idea that most people who try streaming are less likely to go back to shipping. It could have even partnered with some of the device manufacturers, underscoring how easy it is (and encouraging people that today might be the time to upgrade). It all could have been handled seamlessly and without the silly spin of calling a "price increase" a "price change."

Who cares what Netflix does anyway and why does it matter? 

Beyond investors and subscribers, it really doesn't matter. It also makes for a great case study in communication. And the reason there is some significance is simple enough.

Netflix prides itself on the following four traits in an increasingly competitive market: outstanding value, robust selection, customer satisfaction, and adaptability. It believes this is what sets it apart in the marketplace.

The handling of the communication in recent months, especially because the company prolonged the negative communication, cuts deeply at three of those four traits. Customers felt the new price change was not an outstanding value. Customers felt the decisions eroded customer satisfaction. And customers believe that while Netflix might be adaptive, it is not adaptive to the customers it serves.

The worst communication practice for any company is to communicate against the value proposition of the company, especially if it disproves the majority of them. Investors clearly did not appreciate the missteps. Netflix stocks dropped to almost a third of their value (from around $300 to $100 per share) before the price increase. In other words, the lost valuation may have paid for the price increase.

But the real indicator is yet to be announced. On October 24, Netflix will have to report its earnings. And along with those earnings, an accounting of how many more customers are disenfranchised.

Monday, June 27

Buying Skype Headaches: Microsoft

SkypeMicrosoft is buying more than Skype for $9 billion. It's also buying a headache of sorts, one that it didn't make but will eventually have to face as a public relations road bump or two or worse.

The initial rub up with a story penned by former employee Yee Lee, who describes Silver Lake as a bunch of rat bastards, is only one piece of the problem.

In case you missed it, Lee says he's been cheated because his contract gave Silver Lake the right to “repurchase” any vested shares for anyone who leaves the company voluntarily or is terminated with cause. It renders the options relatively worthless. Business Insider Henry Blodget provides a different take on the case.

On its own, this would be a little bit of trouble, but not much. Many people would say Lee was certainly silly to "assume" his contract was of the boiler plate variety. Other people would say it seems odd that "vested" options aren't really vested at all. And everyone would forget about it in about seven weeks.

But the Lee story is only one among several that smack of stock and contract monkey business with Silver Lake. There was also the decision to let some senior executives go, meaning that they aren't likely to get as much as those who stay on through the transition. And just today, Reuters revealed there may be two more oddities ahead.

Microsoft may not look good in the months to come.

While Andrea Petrou speculates that the executives were sacked at Skype early to make Microsoft look good, it really won't work that way given those other stories are coming to light. "Skype employees get screwed" is a sticky message.

The reason it will become Microsoft's trouble is because buyers almost always host their own round of housecleaning after an acquisition. It only makes sense. Not every good fit for Skype will be a good fit for Microsoft.

headacheBut with the complex web of credibility gaps created by Silver Lake, Microsoft will look bad no matter what it does. Even if you dismiss the early firings, the claw back on people like Lee, the other employees who were let go for cause (whatever that cause may be), and what Reuters called a special Cayman partnership created "to avoid the possible application of employee-favorable laws in California and Luxembourg," the collective bad message — employees get screwed — sticks better than any number of complex defenses being forwarded by Silver Lake.

So, when Microsoft inherits Skype and starts calling the shots, any missteps will read as Skype employees get screwed again. And again. And again. (As applicable.) Given Microsoft already has a poor track record on mergers and acquisitions, it's likely there will be problems. And sentiment suggests most Skype users are less than excited.

Many of them expect Microsoft to destroy what is working. And Skype employees are likely feeling uncertain about the future.

The only silver lining is that Microsoft intends to keep Skype as its own operational division. But anyone following these events have to wonder how long that will that last. They also have to wonder how long it will take to forget that Silver Lake set these problems in motion and placed all the blame on Microsoft, for better or worse, deserved or undeserved. Case study ahead.

Friday, June 10

Failing At Mitigation: Johnson & Johnson

Johnson & JohnsonJohnson & Johnson is embroiled in what may be the crisis communication dilemma of the year. You would never know it from their Website. Instead, you'll see a huge section that details how much they care about people.

At the same time, Johnson & Johnson has made a dramatic shift in its communication strategy since the days it delivered a best practice in crisis management for Tylenol in 1982. Instead of being at the forefront of product safety, it is patently less aggressive about product safety related to its other assets.

Specifically, although Johnson & Johnson lends its legal team to assist the court cases being lobbied at Motrin, its once stellar reputation for communication doesn't seem to cover McNeil Consumer Healthcare, which markets the Motrin brand. The Motrin brand is in a communication firestorm. Its Fort Washington plant was suspended in connection with the recall of infants’ and children’s liquid over-the-counter (OTC) products manufactured there. There are other problems with the Motrin brand.

Can a company wear a black and white hat in medicine?

Even more current, Johnson & Johnson is reveling in praise for new labeling on acetaminophen products while simultaneously poised to fight a settlement and labeling related to another tragic story mentioned last week.

SJSThe company's argument seems to be that the Stevens-Johnson Syndrome and Toxic Epidermal Necrolysis (SJS/Tens) experienced by several children in the last few years after taking Motrin doesn't warrant warnings let alone responsibility. They contend it is too isolated. Ironically, it also flies in the face of their 1982 best practice in crisis management.

Back then, Johnson & Johnson revised medication safety because of an isolated incident that affected nine people in Chicago. The company didn't even have any responsibility for that atrocity and it stepped up. But now, when it seems to be responsible, it is willing to invest considerable funds to fight.

Likewise, in the unrelated phantom recall of Motrin products two years ago, McNeil Consumer Healthcare apparently tried to cover up the recall by repurchasing product but not calling for a recall. The result could have led to dangerous products being left out in the marketplace. Johnson & Johnson is fighting that lawsuit too.

Crisis management in the world of multi-brands.

Johnson & Johnson is hardly alone in creating massive companies with multiple brands that most consumers miss on the surface. The question crisis management teams need to start asking themselves is, despite the various degrees of separation, can a corporate parent really afford to play two sides against the middle anymore?

Isn't this the same argument that BP attempted to make during the Gulf Coast oil spill with the incessant blame game? That the lead company was somehow exempt from responsibility if the contractors under its watch were about to make a historic environmental catastrophe.

Like it or not, consumers are connecting the dots with more and more frequency. Companies are held accountable for employee actions. Companies are held accountable for contractor actions. So doesn't it stand to reason that subsidiaries are also accountable?

Ergo, don't consumers deserve to hear better words from attorneys representing a Johnson & Johnson company that “McNeil complied with every federal regulation and that’s what the proof is.”

Mitigation is the single most important aspect of crisis communication.

Under normal circumstances, maybe not. But given Johnson & Johnson has invested billions of shareholder dollars to appear like it is the absolute leader in pharmaceutical customer safety, Johnson & Johnson is risking one of its greatest assets, a brand name that managed to escape increased scrutiny after the Campaign for Safe Cosmetics two years ago.

disaster planningIn considering the four basic tenets of disaster planning, Johnson & Johnson is continuing to fall short in the area where it was always the strongest. Mitigation focuses on long-term measures to reduce or eliminate risk. It considers more than whether a company "can" win a case. It considers what is lost when a company does win a case.

In this situation, when you add up the court cases, future court cases, immediate public relations damage, and long-term brand damage versus a few settlements, relabeling costs (for a product not even on the market right now), and a physician education campaign, it seems to me Johnson & Johnson is reacting instead of taking the kind of proactive safety measures it used to be known for at great cost. Much more than $10 million. Much more than $1 billion. Much more than $10 billion.

The inherent weakness in the decisions being made at Johnson & Johnson regarding Motrin may even reinforce why a toothless public relations division is not necessarily the best division to handle crisis management. They all too often focus on minimizing publicity damage instead of considering the big picture of brand position. Likewise, lawyers aren't always the best crisis management leaders either. Some of them are too busy framing up crisis management cases in terms of whether it is winnable or not.

To make it work, companies need balanced crisis management teams that can objectivity assess the problems before them. And, if public relations is placed in charge of more than a crisis communication team, then they need to be (at least) empowered and given equal consideration as the legal team. Of course, this also assumes the PR team has enough crisis training. Most of them do not.

At Johnson & Johnson, the growing crisis ought be to handled much like an employee incident. Johnson & Johnson needs to scrub McNeil Consumer Healthcare of executives who allow the worst to happen. And, if they cannot manage themselves as a division, the company might consider folding the Motrin brand into its Johnson & Johnson brand. Of course, all this assumes Johnson & Johnson wants to maintain its reputation as a leader in consumer safety, an asset it once spent billions to create.

One wonders what Robert Wood Johnson might think. He was the former chairman (1932-1963) who crafted the company's credo before anybody ever heard the terms corporate social responsibility and a moral compass. What happened?

Friday, June 3

Failing As The Fifth Estate: Public Relations

Two people sent me keen observations yesterday: one in a comment, another in an email. The observations are worth sharing. Maybe it will even wake up a few public relations and social media professionals who claim to cover their industry. More and more of them have all but fallen asleep at the wheel.

Motrin is currently embroiled in one of its most pressing public relations challenges and blowing it badly. And yet, nobody in the public relations or social media spheres seem to be covering it. Instead, public relations and social media pros are too busy writing about love me tools, mea culpas about failed panels, and (unbelievably) the 2008 Motrin ad campaign.

Perhaps worse, all the overwriting about the 2008 snarky ad campaign overshadows the current crisis on search engines (unless you are specific).

A Brief About Motrin's New Crisis Communication Battle.

If the snarky ad campaign didn't convince some people that Motrin can be insensitive to consumers, then perhaps the pair of new crisis communication scenarios will make them think twice. The first revolves around 3-year-old Brianna Maya, who was given Motrin in 2000.

ABC reports a "fine rash on her body and mild redness around her eyes morphed into something insidious." The reaction to the medicine, Stevens-Johnson Syndrome and Toxic Epidermal Necrolysis (SJS/Tens), is rare but extremely painful and potentially fatal.

For Maya, it burned and blistered her body inside and out, blinded her in one eye, required her to be sent to a burn unit, and left her reproductive organs destroyed. She also suffered partial brain damage during the acute phase of the reaction.

SJSAccording to the new ruling, the SJS/Tens reaction was triggered by Children's Motrin, which is marketed by McNeil Consumer Products, a division of Johnson & Johnson. A jury recently ordered the drug manufacturer to pay $10 million for her injuries after they determined that McNeil Consumer Products, a division of Johnson & Johnson, was negligent in warning consumers about such a risk. Children's Motrin is currently unavailable on the Motrin website.

Its unavailability comes with the second crisis communication under covered by public relations and social media. It relates to a phantom recall conducted by the company in 2009. The most hideous example of all communication was included in the State of Oregon's complaint. Contractors were advised of the following by the company:

“Do not communicate to store personnel any information about this product. Just purchase all available product. If you are questioned by store personnel, simply advise that you have been asked to perform an audit.”

McNeil Consumer Products and Johnson & Johnson are defending themselves against the lawsuits.

According to The Consumerist, Johnson & Johnson maintains that the labeling was adequate and the condition is "extremely rare" in the Maya case. And other than initially disagreeing with the verdict, most media outlets report Johnson & Johnson is not responding to requests for comment.

As a crisis communication case study, this isn't a quick fix nor can it be cured with the five steps to crisis communication. I started outlining it earlier this week for next, but opted to provide some backgrounder notes after receiving two separate inquiries about PR taking a pass on this one. This fact also makes me amend my review of Welcome To The Fifth Estate from yesterday. It seems more people need to read the book than I initially said.

Rethinking The Fifth Estate With Shrink Wrap.

As mentioned, one of the primary components of Geoff Livingston's book is that communicators must become participants in a larger world to deliver effective communication. And while he doesn't necessarily say it verbatim, therein lies an interesting point for professionals to ponder...

As communicators who claim to be active participants looking out for the greater public, isn't there an unwritten obligation to cover the uncomfortable along with the slapstick sideshows? Or is something else causing PR to be silent about Motrin?

Is it that professional communicators have taken the advice of Shel Holtz to not be a PR ambulance chaser to heart? Is it that most public relations professionals aren't impressed with the numbers this story may or not draw compared to "three steps to develop a social strategy" or some such nonsense? Is it that public relations has moved so far up the 'expert' perception ladder that it has turned in its fluffy bubble for shrink wrap, tightening the plastic until nobody can see anything beyond their own antics?

After all, the two stories mentioned above, combined with the recent discovery that Johnson & Johnson knew its antibiotic Levaquin increased the risk of tendon damage and equally relevant Baby Shampoo debacle, could make Johnson & Johnson the public relations story of the year. And yet, even self-proclained communication leaders at Ragan are more interested in the U.S. Department of Agriculture's food plate.

It's a curious thing, this dramatic shift in content. Over the last year, a field that used to pile on crisis events ad nauseum is now too busy for them. Who knows? It may be that for all the empowerment that came with becoming The Fifth Estate so did the risk of becoming too important to be bothered with the rest of the world.

Johnson & Johnson case study ahead, sometime next week. Of course, I'm sure it won't be more fun than a balloon popping post.

Thursday, December 9

Playing At Public Relations: Rolls-Royce Asks Will It Pass?

QantasPeople often misunderstand that there is a virtual chasm between public relations and media relations. Rolls-Royce might be one of them.

While the grounding of Qantas Airways Ltd.’s Airbus SAS A380 fleet after an engine explosion may cost as much as $204 million, the airline will likely recover financially even if it does take significantly more time to rebuild the brand. For the most part, Qantas has taken a traditional crisis communication approach, communicating to various publics through multiple channels. It was and still is highly engaged with the media after one of its flights suffered engine failure.

But what about Rolls-Royce? By most counts, Rolls-Royce was largely silent about the failure of its engine about a month ago. The intent seems to follow the forgetfulness of the public by remaining in the background of public discourse.

It's not an uncommon approach. It's the same approach Halliburton took during the BP oil spill crisis. For Halliburton, it seems to work.

Does Communicating Less Work?

For Rolls-Royce, it's not. While the company continues to perform with diversified products and services, it seems clear enough that the engine failure, repeatedly called a design flaw, is weighing heavily on the company. It's not enough to kill it, but it is enough to stall it for an indefinite amount of time.

While the public might be satisfied to hear from Qantas, shareholders and industry experts following Rolls-Royce were not. What did the company offer up to its publics?

“This event and the consequent actions will have an impact on the Group’s financial performance this year. However the scale of our order book, the breadth and mix of our portfolio, the global nature of our business and our strong balance sheet makes Rolls-Royce a resilient business, and we expect continued underlying profit growth in 2010,” Sir John Rose, chief executive officer said.

With that measure being pushed forward to investors, a different message is being put forth to potential customers. Since the interim report, Rolls-Royce has put out a steady stream of releases focusing on innovations and contract wins.

While it is no more or less than it did three months ago, what does seem different is a drop off in softer news. Rolls-Royce is communicating, much like it did to shareholders, that it is all business. And while it has expressed some regret over the incident, there isn't anything to account for in terms of an apology or empathy.

The most current pre-incident forecast by Rolls-Royce was that during the next 20 years, 141,000 engines, worth more than $820 billion, are predicted to be delivered, powering 65,000 commercial aircraft and business jets. Specific to the most popular engines, Rolls-Royce maintained a 50 percent market share. In the past, it contended that the market is pretty unforgiving.

To date, it seems more than the civil aviation market is unforgiving. Investors did not appreciate that the company considered the Trent incident to be "partially mitigated by better performance in the Marine and Defence businesses." Companies that fail to communicate to their publics' satisfaction take much longer to recover than those out front.

Companies Cannot Afford To Be Too Quiet During A Crisis.

The exception, Halliburton during the Gulf Coast oil spill, was only possible because BP public relations missteps had distracted the public. Sometimes that may help a behind-the-scenes company forego public scrutiny in the short term. However, once the bigger bungler is removed from the equation, the behind-the-scenes players step into the spotlight. Case in point, Halliburton no longer has someone in the foreground.

While this story is still developing, the early lesson is that even if a company can escape short-term consequences by not communicating, that does not absolve it from long-term consequences. But more specific to the original observation, Rolls-Royce might already be doing better had it communicated well to select publics (customers and investors) even if it chose to let Qantas handle the media. Case study in progress. (Hat tip: Recruiting Animal.)

Wednesday, December 1

Branding Lessons: La-Z-Boy Reinforces Its Challenge

LaZBoy Ad
The New York Times detailed an interesting dilemma for La-Z-Boy. It seems the company best known for recliners is struggling with non-recliner sales.

The company's solution is to push a "we're more than recliners" message with spokeswomen Brooke Shields. One of the ad headlines is especially clunky: “When La-Z-Boy says ‘relax,’ it doesn’t necessarily mean ‘recline.’" The goal is to present a message of comfort, quality and family-friendliness and help break up the brand definition.

Can enviable brand recognition really be a liability?

Yes and no. Yes, it can be with La-Z-Boy, especially with the new campaign. And no, it didn't have to be if La-Z-Boy realized there was a much simpler solution, with or without Shields.

The challenge with the new campaign is that it invests considerable time conjuring up the old and powerful image, which reinforces the message supposedly holding them back. La-Z-Boy is most readily identified with a 1950s-60s-70s image of a head of household kicking everyone out of the recliner. Shields even says so in one spot, reinforcing it was "Dad's chair."

That image, even within the confines of storytelling, is powerful. It almost drowns out the rest of the message, which has Shields talking about her family, which isn't shown, enjoying her full line of La-Z-Boy furniture. The button cute ending has her muse about no one being able to kick her off the furniture now.

The spots, especially, aren't bad. Shields does a great job delivering authenticity with the lines. And, according to the article, the campaign will total at least $20 million, combining spending by La-Z-Boy and by furniture dealers. Ironically, however, this only constitutes a fraction of the total ad spend for La-Z-Boy, which will likely focus on recliners.

A different solution La-Z-Boy could have taken might have used Shields or not. It might have introduced a new sub-brand such as "Laurel by La-Z-Boy" (generic for the purposes of this post) and been paired with images of families. It might have been more effective, creating a bigger space between the original brand and the La-Z-Boy brand, while still capitalizing on the history and strong name recognition that owns recliners.

It could have also quelled the one authenticity-killing realization that despite Shields claiming a couch as her own, she is also married to several other shoots. It's hard to believe that she owns them all. It's even less convincing when you see the same setup in the product-only shoot.

La-Z-Boy Nostalgia Has The Mark Of Old School Marketing.

There is nothing wrong with La-Z-Boy as a company, despite what many might consider a high side price point. Still, it seems a complete strategic overhaul of its marketing is in order. It has all the right assets, with many of them being managed at a just above par level.

For example, you can order the furniture online, but the interface is an off-putting funnel approach for every product. (And some products are not available for online purchases.) The website has a 3-D room planner, which has potential for people with updated computers. It also has a construction primer worth checking out.

La-A-Boy also has fledgling social network efforts in play, with an emphasis on the most popular networks. However, the communication suggests the company isn't certain about what to do with these accounts. It's not bad, just basically bland (although they deserve props for promoting Ronald McDonald House). A blog would probably help their networks fine tune their content contributions and open up a better conversation.

The point is that Laz-A-Boy seems to have the right ingredients but it still seems separate with an obvious lean toward recliners. A refreshed plan could probably help reinforce furnishings much better than a traditional mass media marketing approach. In the meantime, it's worth watching as a living case study.

Wednesday, November 24

Dumbing Down: TSA Policies Are Not A Privacy Issue

It may take some time, but the Transportation Security Administration (TSA) and Department Of Homeland Security will eventually lose the argument they have chosen, and their failed public relations program is only part of the reason. The real problem is they have chosen the wrong argument in what seems to be an attempt to dumb down complaints.

“We are constantly evaluating and adapting our security measures, and as we have said from the beginning, we are seeking to strike the right balance between privacy and security,” John Pistole said in a statement.

Except, it's not a privacy issue. It's a liberty issue.

"The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized." — The Fourth Amendment (Amendment IV), United States Constitution

Currently, no matter how you frame it (even claiming that certain transportation methods are privileges, as if), TSA policies are a direct infringement on the fourth amendment. And, even the TSA argument, that 75 to 80 percent of the public supported these measures, we might remember the U.S. Constitution was not written to protect a democratic majority, but the minority.

Heck, I've seen polls over the years that suggest better than half of all Americans would vote to have their homes searched without warrants too (based on the pretense they have nothing to hide). And a certain percentage are in favor of installing videos everywhere to help quell their irrational fears. But that doesn't make it right, just, or even remotely American as Henry Blodget seems to pretend.

The most recent TSA policies, those that were inspired by timing (and despite a bill that barred their use as primary scanners) along with pat-downs, are a threat not to our privacy but to our liberty to travel freely in the United States. Unchecked, you could argue such tactics for anyplace where people congregate (don't laugh). And if that continues to happen, unless Americans speak out against early infringements, we may as well declare the very people we are protecting ourselves from the victors.

"They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety." — Benjamin Franklin

I ought to make it clear, I'm not necessarily a fan of TSA security officer bashing in general, especially after my recent experience with air travel. Not every airport is staffed by overzealous or authoritative agents. Most are decent, respectful people, with the difference between departing from Las Vegas and departing from Providence like night and day.

Granted, one airport is significantly busier than the other. However, the professionalism, demeanor, organization, and courtesy of the agents in Rhode Island was light years ahead of Las Vegas, where it is made abundantly clear that the security check points are to screen for terrorists with every citizen and visitor being a suspect. Management in Las Vegas ought to take note.

Our representatives might take note too. The hypocrisy is deafening. The laughter is disheartening, conjuring images of being subjects as opposed to citizens once again.

The brewing public relations nightmare is a point of contact problem.

In response to the backlash of a situation that the TSA created, Pistole has resorted to begging citizens against opting out of full image scanners and pat downs, especially during Thanksgiving. It wouldn't be fair, he argues, to make it a hassle for those trying to make it home during the holidays, as if the opt-outers are somehow responsible for the decisions the TSA made.

I'm sure many colonists were put off when their tea was tossed into the Boston Harbor too. That's the way it goes sometimes.

The only solution to fix the continued erosion of TSA's reputation is to reverse some invasive policies and, most importantly, understand that for the majority of air traveling Americans, the point of contact — security check points — IS the public relations program. Every TSA security officer IS also a public relations agent. No amount of communication can change this fact; even TSA's mission statement demands it.

The TSA is operating out of alignment with its mission.

"The Transportation Security Administration protects the Nation’s transportation systems to ensure freedom of movement for people and commerce." — TSA Mission Statement

While some people consider the horror stories related to pat-down searches, each infraction need not be excused away as accidental lapses in service. They are in direct violation of the agency's own code of conduct to "respect and care for others and protect the information we handle."

The point is that the administration is causing its own problems, which stems in part from Pistole operating off the TSA mission statement with his own, as provided for in his bio, to "grow as a risk-based, intelligence-driven counterterrorism agency dedicated to protecting our transportation systems."

His approach seems to have nothing to do with respect and care for others or to ensure freedom of movement for people. But, without meaning to disparage his otherwise respectable career, individual visions do not trump an agency's mission. If the TSA truly wants to be on the same side as the public, it will change its policies, adopt less invasive procedures that have resulted in better outcomes elsewhere in the world, and remind officers that their employers are the people in front of them.

Full body imaging is only the beginning, says the TSA website.

Don't expect it to happen soon. The TSA has outlined exactly how aggressive it will become in the near future. In developing what one of my colleagues calls the theater of checkpoint security, the TSA states it has deployed more than 900 X-ray systems and 450 imaging scanners, plans to add biometric identification systems (fingerprints and iris scans), and expand operations to include not only subways and other transportation, but "important facilities" as well. Think about that for a minute. Or two.

Then consider that these videos will become more frequent and the responses less defensive. According to the response, the father removed the shirt of his son to expedite a search, but what remains unclear is why removing the shirt might have expedited it.

All this, and it's still safer to board a plane (1:10.46 MILLION) than to drive a car (1:84). I'm slating the issue as a case study.

Tuesday, October 26

Causing Havoc: NPR's Whack-A-Juan Game

Vivian Schiller
When Bob Conrad first posted his take on the Juan Williams vs. NPR shakeup, I was quick to disagree. Too quick? Yes and no.

Conrad's position is better crafted if you read his take on the dust up, but the summarized version, simply put, is that NPR was within its rights to fire Williams. There is no dispute there.

Conrad also goes on to show the documentation, including the memo sent to everyone who works for NPR and the posting that outlines an entire history for consideration. Within the post is the real reason: NPR didn't like Williams working as both a "balanced news analyst on NPR; more opinionated pundit on Fox." (Minor point: He has been asked to give opinions across multiple outlets for years.)

The postscript might make some more sympathetic to NPR. And for others, the explanation leaves even less to be desired.

That is my contention. NPR may have been within its rights to fire Williams, but the fact that it wasn't satisfied with being within its rights was a mistake. It wants to be right too. And in being right, it wants the public to say it was right too. Too bad.

Being right is often a matter of opinion. And the initial case laid, that Williams made allegedly bigoted remarks, is open for debate.

Were Williams' Remarks Bigoted Or A Mechanism For Discussion?

They were not. You have to watch the entire clip to understand it. I did several times, but I only found a partial clip. He shared a personal experience, qualified on the front end and expanded upon it beyond this video, talking about how Americans must learn to distinguish between radical extremists and non-radical muslims. He also tried to reiterate this in his reaction to the firing.

My first thought for this post was to place this in a different context, mentioning the Confederate flag, which became (to some people) a symbol of slavery and racism. Or maybe it is like the swastika, often considered a symbol of hate.

In this case, Williams taps into the same thinking about "full muslim garb." He is not alone. Many Americans have taken such dress to represent something that it may or may not be. I don't share this feeling (or any feelings like that). But I do understand feelings like that. So perhaps it is better to explain from a personal experience.

Years ago, at the urging of one of my closest friends, I joined the NAACP (which seemed to have a milder platform then than it does today). My intent was to help the NAACP carry a broader and more inclusive message. My supporters in this pursuit were my friend, Nev. State Sen. Joel Neal, and Rev. Jesse Scott.

The first time I had the floor at an NAACP meeting, I was nervous. Rev. Scott had even told me I had every right to be nervous, because many people within the room would look on a caucasian NAACP member with suspicion, especially in a community that had recently been likened to the Mississippi of the West (whatever that means). Sen. Neal had even quipped that I had every right to join, given that the "C" in the NAACP stood for colored. My color just happened to be white. (If I was translucent, he also joked, I would not be allowed to join.)

So, does sharing this public speaking experience, and the fact it made me nervous, make me a bigot? Although I would be hard pressed to feel nervous speaking anywhere today, I think not. At worst, I was ignorant. But ignorance is readily cured with open dialogue, assuming people are open with their feelings. (As a side note, I was also nervous speaking to my first class at UNLV, with a mixed audience.)

Looking back, I never did as much as I wanted to do for the chapter then. But there were several other people that I enjoyed and appreciated meaningful friendships with from that point on.

I would like to think that is where Williams was coming from in his commentary. But, I can understand why those who might have had a much more sheltered set of experiences might not see where he was coming from. His commentary was a bridge to mutual understanding that humanized the story and helped people relate. At the other end of this bridge, was compassion.

The NRP Public Relations Debacle.

NPR has already admitted it handled the situation poorly, especially in that NPR President Vivian Schiller saw no trouble in sharing her personal views of Williams. She has since publicly apologized, which begs the question why the network didn't extend the same opportunity to Williams.

There were dozens of ways NPR could have kept itself out of the spotlight or handled the mess, including not renewing his contract or insisting he apologize (which might have convinced him to resign). But regardless of all of these other options, there is a bigger issue.

NPR is still insisting not that it was within in rights, but that it was right in its decision. This insistence comes well after all its admissions of mistakes and apologies and regrets. And yet, they persist.

What they don't understand is this: Whether NPR is right or not, the network chose to pursue a court of public opinion for validation over the firing. If you pursue public opinion for affirmation of anything, you might expect to be grossly disappointed. And, once disappointed, don't make the mistake of arguing to be right or continuing to whack someone you already fired.

NPR was within its rights to fire Williams, but it fired Williams for the wrong reasons. Period. And until NPR accepts that, all it will do is fan the fire of those who disagree.

If they do it enough, then it is very likely they will be fired too, losing one to three percent of income that comes from taxpayer funding (or perhaps that figure is more). But even if they keep their funding, this is one of the stories that will make it difficult to see NPR the same way again. The New York Times included.

Thursday, August 26

Lingering Aftershocks: Hewlett-Packard

Hewlett-Packard (HP) is still learning the hard way. In the immediate aftermath of a crisis, every decision made is weighed against the crisis. Every decision, including the acquisition of 3PAR.

Three weeks of being unwilling to match Dell’s $18 per share offer for 3PAR, HP re-entered with a $24 per share bid. The switch has some people wondering whether the change of heart is tied to HP's apparent need to prove that it is "business as usual."

Without Closure, Every Decision Becomes A Comparative.

You can hear the rumbling in the background. Even if the acquisition of 3PAR is lucrative for HP, the unwritten questions remain. What would Hurd do? And, more telling, are the board of directors pushing for the acquisition for public relations?

These questions might not be asked as often had HP been more aggressive in closing out the crisis as opposed to attempting to operation it out of the picture. Worse, they've spun up several new allegations and stories, some of which don't add up (hat tip: Ben Tremblay) while leaving plenty of questions unanswered.

No one can blame HP for insisting that they want to "look forward and not back," which basically means they intend to shrug off transparency. It also reinforces the idea that the universe doesn't understand negatives. Every time those words are uttered, it means the opposite for everyone else.

The evidence is all over the 3PAR discussions. HP has put itself in a position where winning or losing looks equally questionable. (Note, I'm not saying the acquisition is vital for HP or not.) If they don't see it through to the end, people will wonder if the acquisition about-face was public relations driven. And if they do win, they might ask the same thing.

The primary question people ought to be asking is how much is too much to pay for 3PAR. But, with the scandal still lingering in the background, the merger (win or lose) won't clear HP from the crisis it picked. What will it take? A new CEO who delivers gains for two quarters ought to do it. Their crisis communication should have this benchmark built in.

Finding The End Of A Crisis Is Harder Than Managing A Crisis.

Most crisis communication plans never consider the situational challenges that occur long after the immediate crisis has ended. One might even say that this is the caveat missing from the Toyota concept that all is forgotten after 70 days. While there is some truth to that, crisis communication planners need to have a realistic view of when to start that 70-day ticker.

In this case, closure didn't occur with the resignation of Hurd. (You can see it in the stock valuation.) Had he not resigned, the company could have started the ticker on the date of the harassment settlement. More importantly, companies have to be careful in how they make bold movements while still suffering from crisis aftershocks.

As long as the motivation is only to deliver shareholder value, it's easy to back bold moves. But if decisions are being made because there is something else to prove, then they've done more than lose the HP way. They've lost any semblance of purpose.

Wednesday, August 11

Inviting A PR Disaster: Hewlett-Packard

If there is any doubt that Hewlett-Packard implemented the wrong crisis communication strategy, look no further than abundant speculation. Speculation doesn't happen by accident. It happens when the public doesn't have any semblance of clear, authentic communication.

Stanford scholar and longtime Hewlett-Packard watcher Chuck House has come out strong for HP. He says chief executive Mark V. Hurd's resignation is tied to red herrings. The real reason, he says, is Hurd, nicknamed Mark Turd by ex-HPites who worked directly for him, was a thug.

The Los Angeles Times has taken a different tact. It reports that the HP board of directors ought not to flash a high standard of ethics too liberally. They cite how employees and top brass are treated differently when it comes to compensation, including an unusual formula to calculate the lump sum value of pensions that increased John H. Hammergren's pension from $11 million to $85 million.

James B. Stewart, a columnist for SmartMoney magazine, takes yet another approach on The Wall Street Journal, claiming that the HP board of directors didn't disclose enough. He writes that "by withholding information, the HP board is only prolonging the agony and feeding the press a juicy mystery." Perhaps not on the front end, but certainly now, HP has bought a crisis communication plan that caused more pain than if it would have not reacted to the threat of scandalous publicity.

Bad Crisis Communication Plans Magnify, Multiply, And Amplify.

There are more than 10,000 HP speculation stories across the globe today. And by the looks of things, it's only the tip of the iceberg.

Even if we just look at these three stories, they are all bad, even the pro-HP piece penned by House. It makes you wonder how powerless the board of directors was, waiting for a misstep to bring the "evil" executive down. The Los Angeles Times makes it look like the board is engaged in selective ethics. And the Stewart write-up makes it look like they are holding back, perhaps even lying.

Any time the crisis flies in more than several hundred directions, you know it's botched. Now, business reporters (people who are always looking for exciting stories because the daily stories aren't always so exciting) are looking at every angle. They are making mountains everywhere and they are doing it well beyond the scope of the initial crisis, which was a mole hill by comparison.

Situation Analysis Is Always The First Step In A Crisis.

If there were any internal politics as some suggest, they do not belong on the boardroom table at a meeting to discuss disclosure in order to avoid a public relations disaster. Handling a crisis can only have one objective: minimize damage.

So, if we take the board of directors' word that there is nothing more than what they disclosed — that Hurd was engaged in a non-sexual close relationship but fudged expense reports to hide the relationship to avoid the perception of an affair — then there is no other conclusion than they botched the plan.

In this scenario, a better course of action would have been to clear the chief executive's name, make him pay the $20,000 back (which becomes a personnel matter), manage any crisis in the event it becomes a crisis, and move on. After all, in this case, there was no evidence that Hurd's transgression (which isn't even clear as a transgression) would have been as big of a blip on the media radar. Even if it was, it seems the intent — if it was to avoid a crisis — has backfired exponentially.

This leaves us with two possible outcomes. Either HP created a crisis out of nothing or there is much more to the story.

I'm not big on crisis communication rules other than treating them as situational. I look at the classic tenets of crisis communication and see guidelines that help us ask the right questions given the readily available information we have.

However, if you do want a rule to hang on your shingle, I might suggest this one: in for a pinch, in for a pound. And once you are in for a pound, you'd better hope your only motivation was to articulate the crisis as authentically as possible.

Evaluating A Living Crisis Communication Situation.

Almost every time we evaluate a living crisis communication case study, someone inevitably says that it is too soon to conclude anything. In general, I agree with that assessment. For example, I would be doing you a disservice if I said this will kill HP.

I don't think it will (operative word is "think"). I buy HP products because the hardware is good. The ink, on the other hand, is very pricey. But I suppose it's possible.

However, public relations professionals and crisis communication managers ought to know by know that they have to draft crisis communication plans based on readily available information (not all information) and build in dozens of contingencies if and when that information turns out to be inaccurate. It happens all the time.

Sometimes the people in the field make a mistake. Sometimes public perception turns bad regardless of the facts. And sometimes, clients aren't always forthcoming. They might not lie, but I have heard "Oh, I probably should have told you ..." enough times that charging clients one dollar per utterance would have meant my retirement.

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Tuesday, June 1

Lacking Leadership: Minerals Management Service

With the Obama administration facing its first crisis without a discernible opponent to discredit, House Speaker Nancy Pelosi recently offered up one solution. Blame Bush for the Minerals Management Service, which is the regulatory agency that oversees offshore drilling.

This time around, the excuse seems as desperate as her disgust over being asked whether she would donate hair to help. The reason her allegations seem disingenuous only requires a quick review of the facts.

Minerals Management Service Backgrounder

In the Gulf Coast, the Minerals Management Service (MMS) is partly responsible because it was the one agency that could have pulled the plug on the bad decisions being made. The agency didn't. Even when BP sent unusual rapid-fire requests to modify permits, the agency seemed to keep pace, approving some within as little as five minutes.

Neither BP nor Transocean has commented on the permit changes. And despite the promises of an administration to be more forthcoming and transparent, MMS declines to comment too. Perhaps nobody is talking because they all know the risks.

Sure, MMS had a track record of problems that came to light after the inspector general published a devastating report in 2008. The report revealed ethical lapses related to the MMS royalty collection program and officials at its Lakewood office who had engaged in drug use and sexual activities with industry insiders. But those problems do not necessarily lead to the crisis.

Contrary, according to previous statements from Secretary of the Interior Ken Salazar, the agency had already been beaten into submission with reprimands, terminations, and criminal prosecutions. Salazar himself took the lead in reforming what he described as a corrupt culture. But after his house cleaning, it seems Salazar failed to fix the damage.

As soon as Elizabeth Birnbaum, who recently resigned, took charge of MMS about 10 months ago, she found a demoralized agency ill-equipped to meet the new priority of renewable energy. Clicking on the link to the MMS DOI Strategic Plan seems to confirm it. The return reads "file not found."

While there is no plan, it does seem Birnbaum cared and was trying to manage the leaderless agency, funneling most of her energy into offshore wind projects in the Atlantic. And, she wasn't afraid to speak on the Gulf Coast crisis. In fact, she was preparing to testify before a congressional panel about the agency's role in handling BP's massive oil spill in the Gulf of Mexico. But Salazar's office didn't want her to testify. She resigned shortly after.

The Missed Opportunity For MMS

Despite its own negligence that contributed to the Deepwater Horizon crisis, standard communication protocol would have called for MMS to take charge of its communication much like the U.S. Food and Drug Administration took charge of the crisis created by the Peanut Corporation of America (PCA) in 2009. So why didn't it?

House Speaker Pelosi already provides the answer. Allowing MMS to become the point team on the crisis communication would have circumvented the administration's ability to deflect responsibility.

So instead of MMS (or the EPA as an alternative) taking the communication lead, the Department of the Interior all but silenced MMS before proceeding to break it up into parts. In place of a centralized communication channel, like we saw with the FDA or even FEMA in the wake of Katrina, the public is given a collection of sometimes contradictory statements about the crisis and who is in control.

Even at the special Deepwater Horizon Response Web site, it is unclear who is responsible for managing the content. It's every agency for themselves. There is no leadership.

Sure, the Deepwater Horizon Response site includes the 15 different agencies and companies that make up the Unified Command, but it does not assign any particular agency or company responsible for updates. While U.S. Coast Guard Adm. Thad Allen is now identified as the national incident commander, he was also the first to honestly admit that the federal government was not broadly "in charge."

It was this candid, honest response that prompted the American Spectator to call him the only adult on-scene commander for this disaster. Clearly, he ought to be charge if for no other reason than to stop the non-communication coming from Department of Interior, The White House, and other agencies. (Even this weekend, I received a news release from the EPA with nothing more than a visitation tally count among the President and other cabinet members.)

Why all the confusion? The reality seems to be that no one is in control of the spill or the cleanup. And the sheer lack of a centralized communication plan can only be indicative of a top-down failure to establish any centralized leadership.

The international community is just now seizing on this fact, noting that U.S. authorities took unnecessarily long to define the incident as a national disaster and failed to appreciate early enough that BP had no ready and obvious solution for stopping the leak. For them, it's all too obvious in the speeches being delivered by President Obama.

Obama seems to be waffling on whether to call BP a partner or public enemy number one. In one speech, he even drove home the point that his administration was in control but then stressed BP was letting him down as it called the shots. It can't be both. Or can it?

As investigations continue, the administration can expect the questions will become more and more difficult. The international community is already asking why the Obama administration was poised to open up more offshore drilling when they weren't confident in the regulatory agency overseeing it and without an emergency oil spill response plan.

So far, instead of answering those questions, President Obama has pledged to bring those responsible to justice. Ironically, such a move might include his administration; if not for the leak, then for the containment of it.

A special thanks to Geoff Livingston for inviting me to discuss some of these issues on his online radio show, EL Show, today. Tomorrow, we'll present some ideas on how the administration could attempt to turn the crisis communication failure around.

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Friday, May 28

Shifting Communication: Transocean Acts Under Siege

Much like Halliburton, the Transocean Web site remains unchanged by the Gulf Coast oil spill.

The most haunting page of all falls under the tab of responsibility. "At Transocean, we firmly believe that the safety of people underpins our success. Our safety vision above covers all our drilling units and shore-based facilities worldwide." And then there is the promise in big bold letters splash across the page as the header.

"Our operations will be conducted in an incident-free workplace, all the time, everywhere."

It's not just a headline by Transocean. It's also the company's vision statement.

Just off the front page, the only section mentioning drilling rig Deepwater Horizon is under news releases. All of its communication there has been a steady stream of releases, with an emphasis on the event from April 21 to April 26. April 26 marks the day that Transocean communication decisively changes.

The Communication Snap At Transocean.

What changed? Transocean shifts from crisis communication to increasingly defensive protectionism. After sending a message to investors that the total insured value of the rig is $560 million on April 26, releases shift to a limitation of liability petition for approximately $26 million as a necessary step to protect the interests of its employees, its shareholders and the company.

After that decisive turn, most communication becomes reactionary to rumors and the news reporting on those rumors, including the alleged distribution of any incident response forms that promised cash for cooperation. Four days later, Cheryl D. Richard, senior vice president of human resources and IT, announces her pending retirement.

The next and last communication, on May 25, responds to what it calls erroneous reports relating to its "shareholders' approval of a dividend and its intent to avoid liability arising from the Deepwater Horizon incident or to profit from such incident." The release goes on to say that "Transocean will honor all of its legal obligations arising from the Deepwater Horizon accident."

A statement seems to contradict its limitation of liability petition. Meanwhile, the company's online newsletter Beacon, appears frozen in winter 2010, filled with letters of praise. It's biannual employee publication is frozen even earlier; the last available issue published in 2008.

Coincidently, perhaps, 2008 also seems to represent a shift in company behavior. Between 2008 and 2009, Transocean went from a hot stock pick to a company that seemed to move away from the aforementioned safety-laced vision. The company had five management appointments, two vice president appointments, and a change in the nation where it is incorporated. It moved from the Cayman Islands to Switzerland.

The Transocean Connection To The Spill.

For those who might not know, Transocean was the owner and operator of Deepwater Horizon. As such, Lamar McKay, the president and chairman of BP, has alluded that the blame belongs there (despite BP accepting responsibility for the cleanup). Transocean CEO Steve Newman responded by saying it was not the time for finger pointing ... before attempting to shift blame away from his own embattled company.

If there is any truth to some of the stories surfacing in papers today, the Deep Horizon incident plays out like many construction contractor-subcontractor relationships.

Subcontractors sometimes drag their feet, which places pressure on the supervising contractor to exert influence. In one summary offered up by the Huffington Post, which criticizes the absence of two key testimony witness, it seems to be the most logical scenario, with "Donald Vidrine, BP's 'company man,' overruled the rig's chief mechanic and driller and pushed to speed up the process by remove the drilling mud faster to save BP money on the day of the tragic explosion."

It would make sense, given many of the initial delays were related to the Halliburton slowdown. However, there is one write-up that smacks of perception. If oil rigs are anything like ships, BP could probably not overrule a chief mechanic and put Transocean at risk unless the owner-operator was predisposed or ordered to follow contractual obligations and ignore the company's eroding vision to allow safety to lead to success.

The Psychology Of Influence And Erosion Of Communication.

If you worked as a pizza delivery driver and the boss told you to drive 20 miles per hour over the speed limit to shave 15 minutes off the delivery time, you might be inclined to say no. Some people might even say hell no. On Deepwater Horizon, Transocean said yes.

Once again, it seems Milgram was right. The question that ought to be asked is what convinced a chief mechanic and driller to change his mind? Was it mounting pressure from BP? Was it the lack of communication or a direct order from his company? Or was it the authorization to proceed from the regulatory agency's approval to proceed?

Answer that question andprimary party responsibility seems to land squarely. However, that is not to say the balance of participants are to be exonerated. Guilt doesn't wash off as well as oil.

From the perspective of communication alone, Transocean seems to have the most to lose. It's clearly the most defensive, sometimes flailing about. There must be a reason. Sometimes those actions are the sign of inexperienced communicators or crisis counsel. Other times, it's merely an admission that the company hasn't been observing its vision for the better part of two years.

We'll pick up on our crisis communication evaluation next Tuesday. Mostly, we're just thrilled the real priority, plugging the leak, seems to be working. In the interim, consider some other worthwhile perspectives.

• Geoff Livingston pinpoints where BP communication becomes muddled. It's an excellent point-by-point resource primer.

• Patrick Kinney of Gaffney Bennet Public Relations talks to Lynn Neary about BP's public response to the Gulf oil spill. Kinney worked for Ogilvy Public Relations when it helped BP rebrand itself as "Beyond Petroleum."

• Chris Maloney pens one post that pinpoints what BP seems to be doing right since taking full responsibility for the spill. His writeup is a bit more tempered than those who gave BP a B on crisis communication. (A "B," really? Not in my class.)

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Thursday, May 27

Communicating Zip: Why Halliburton Is Quiet

When you visit the Halliburton Web site, one of the world’s largest providers of products and services to the energy industry, business continues as usual.

The board declared a 2010 second quarter dividend of nine cents ($0.09) a share on the company’s common stock, the Gulf of Mexico remains "one of the world's most prolific producing areas," the company was busy presenting at the 2010 UBS Global Oil and Gas Conference, and the deep water drilling section of the site concludes "our experience speaks for itself."

Mostly, with exception to the prepared statement (one release away from being bumped off the home page) that was delivered by Tim Probert, president, Global Business Lines and chief Health, Safety and Environmental officer, Halliburton, the oil spill in the Gulf of Mexico already reads like a memory rather than a current event. It's not.

The Halliburton Connection To The Spill.

Halliburton connection to the crisis is that it was responsible for sealing the well. The casing to seal the well was installed several days before the explosion. (CNN provides one of the better investigation time lines for April 20, if you are interested.)

What makes the casing significant is most accounts point to gas leaking through the casing just hours before the explosion. This seems to be supported by BP briefs as rig workers tried to close valves on the blowout preventer at least twice.

However, there are four points to consider related to the casing. Only one point falls squarely on Halliburton.

1. BP's decision to install a single barrier option made the best economic case.
2. There are some contentions that the Halliburton work was taking longer than usual and possibly improperly constructed .
3. BP seems to have made a decision to perform some tasks related to the last plug in reverse order, something that would require MMS approval.
4. BP officials had made a decision to run only six of 21 tests to ensure the drill pipe was properly centered; an uneven drill pipe could have contributed to the instability of the installation.

The Halliburton Postion And Communication Strategy.

The Halliburton position is that it was following Transocean’s orders (as dictated by BP) and is "contractually bound to comply with the well owner’s instructions on all matters relating to the performance of all work-related activities." It has simultaneously defended its work while also claiming it is premature and irresponsible to speculate on any specific causal issues.

In terms of ongoing communication, other than saying it is cooperating with investigations and releasing its investigation statement, the company is silent. While Halliburton is providing some intervention support to help secure the damaged well and planning and services associated with drilling relief well operations, details are absent.

Public relations professionals and crisis communicators generally hate this communication approach. The reality is that such little communication from Halliburton is indicative of a subcontractor role. Crisis communicators don't generally teach it, but subcontractors generally attempt to position themselves as subordinates.

The benefit for the subcontractor is limited responsibility for the communication. The benefit for the contractor is greater message control. In this case, Halliburton has mostly used its communication to send a message to BP and Transocean. That message is clear: it's your show unless you try to toss us under the bus.

Halliburton Communication Overview.

• Of the three companies, Halliburton is in the best possible position to escape the bulk of the backlash. It seems to know it, because even if the investigation shows its work may be the primary cause, the primary cause on its own did not result in a disaster. Several decisions leading up to and after the installation seem to have led to significant lapses in safety.

• The subcontractor communication strategy — based on the observation that the general public is not the customer — is becoming an arcane practice. While subcontractors have been traditionally exempt from the most rules of communication, the general public has become increasingly critical of subcontractors since the advent of social media.

• There are still weaknesses in Halliburton's communication. Given prior public exposure, the public is beginning to remember its name as a controversial and untrustworthy corporate citizen. Further, the excuse, "just following orders," seems as thin as medical personnel who relied on it during another crisis we covered two years ago.

• The most challenging concept for communicators to grasp is that the greatest threat to Halliburton is not tied to public pressure. It is only tied to how future contractors perceive their communication and cooperation during the crisis.

Since the company's survival rate is mostly based on how contractors view their cooperation, it seems likely that this company will once again survive controversy while employing a situational communication strategy that most communicators would not recommend. What could it do better?

Even for a subcontractor remaining mostly silent, Halliburton could have shored up communication on four fronts. Among them: communicating policies to ensure safe working conditions despite contractor "orders," avoiding any speculation in the testimony as opposed to what can only be called selective speculation, providing BP updates to roll on their site despite their own silence, and better communicating its role in cleanup efforts as a BP partner in being part of the solution.

In 2009, Halliburton’s total cash and in-kind donations amounted to $572 million. It would only make sense to earmark some of these funds toward a cleanup effort the company is at least partly responsible for.

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Wednesday, May 26

Managing Crisis: Bad PR Is Only A Symptom

Any time a crisis involves a natural disaster, environmental catastrophe, or drawn-out tragedy, there is only one point of discussion.

When is it going to stop?

Transparency? It doesn't matter. Who is at fault? It doesn't matter. Is the federal government doing enough? It doesn't matter.

Sure, those questions are bound to be asked and asked again. Thirty-seven days is a long time to be in the midst of a crisis with multiple events. And during that time, when specific event coverage can no longer hold viewer interest, investigations start and second tier questions bubble up. But all stories always come back to that singular question. When is it going to stop?

It's the primary reason that for any communication offered up by one of the world's largest energy companies, it always circles back to live shots of oil spilling into the Gulf of Mexico from the ocean floor. It always ends with oil washing up on the shore. It always comes back to the impact on animals and sea life or the disruption of life for residents who live within the path.

This isn't "Obama's Katrina" as some people like to call it. Katrina was over, from the time it was upgraded to a tropical storm, in five days.

The oil spill is not an event. It's multiple events.

If there is one fatal flaw in the communication strategy by BP, the Obama administration, and dozens of other vested and guilty parties, it is that they have neglected to see the obvious. This crisis is not a singular event. It's a multiple event crisis, with each event requiring a different set of answers for first tier questions.

• Provide updates and estimates related to the time and date of the event.
• Determine the what, when, where, how, and why.
• Determine who will be involved and to what extent.
• Determine the public or environmental risk of each event.
• Determine the extent of any property damage and loss of life.
• Determine which authorities will be on the scene of each event.
• Estimate and create action plans when each specific crisis will be resolved.
• Keep providing updates, with any positive outcomes, until it is resolved.

Isolating each event related to the crisis is critical if anyone hopes to manage it. Otherwise, the culmination of unrelated events will overwhelm any singular or tag team entity much like Toyota's sometimes unrelated recalls that eventually added up into a company that lost its way.

As a visual, the greater mass of the oil crisis might be likened to a giant blob that BP is attempting to hold up on its own while other vested parties stand by hoping for the best. It's not possible. Crisis and communication blobs do not act like solid mass. They act more like oil. It slips. It drips. And eventually it will coat everyone involved. It doesn't matter who gets more soiled.

Instead, the entire crisis needs to be broken up into parts. There is the leak, which was the initial cause of the crisis. There is the oil that has already seeped into the ocean, killing wildlife, damaging fishermen, and halting tourism. There are scores of smaller events that impact specific ecosystems, local communities, and residents.

The first tier priority is to stop the leak. Until then, nothing else matters.

The second tier, which occurs simultaneously, is to contain the spread of the oil and disperse it. BP is managing this effort, but relying on support from the Coast Guard and hired local fishermen. The results to date are mixed, with some unexpected consequences to the individuals exposed to chemicals.

The third tier are the dozens of events that occur anywhere oil washes up on shore. BP is attempting to mange this aspect of the spill as well. It's clearly not working, with impacted states beginning to take the heat for not doing enough.

A reorganization of the entire process is badly needed. BP clearly needs to focus its energy on stopping the leak. The federal government needed to and still needs to step up responsibility and take action on mitigating the the impact of the oil that has already escaped instead of attempting to armchair quarterback the scene with conflicting messages. And local state governments ought to have taken the lead on individual events, with support from various environmental groups, to keep the beaches clear and clean up as the oil made landfall.

Sure, BP could still act as consultants on the second and third tier events, increasing its presence as each event is resolved. And they ought not to be acting alone. Some of the companies that have a partial responsibility are all but silent on the issue.

And the blame game? Who cares about that?

Considering the amount of oil that has spilled into the Gulf Coast, the top kill solution (if it works) is only the beginning of the environmental events to come. The blame will eventually come to light as investigations continue. What will also be the subject of great debate is why the federal government sought to look like it was in control early on, but then demonstrated only a presence.

Public relations alone cannot solve such a crisis alone. Neither can the various boycotts. If anything, boycotts could make the situation worse despite the reasons some people say to move ahead.

Healthier ways to participate in the crisis at this time include any number of efforts. One beneficiary of a satirical Twitter account BPGlobalPR is to raise funds for the Gulf Restoration Network. The boycotts, if any, can wait until after the spill.

Public relations is always reliant on the actual plan.

When any plan to deal with a crisis is bad, the symptom is improper communication. For its part, BP has attempted to keep communication channels flowing, but it is clearly holding back. They seem to be focused on a singular thought that if they fix everything and then prove themselves to be only partly to blame, then they may be able to justify the clean green logo.

However, as Geoff Livingston points out, that is not the case. He writes that the collective "crisis PR has been terrible with missteps on resolution, horrific transparency on possible solutions, false accounting of actual daily oil spill amounts, the policing of beaches to prevent media reporting, bickering between BP and the EPA, dispersants’ negative impact, a new climate bill that endorses further off-shore drilling, 19 new off-shore drilling licenses since Deep Horizon, etc., etc., on and on."

He says the crisis might be insurmountable for the company. I'm not sure yet, but only because BP is much more than BP. BP is Castrol, Arco, Aral, am/pm, and even the Wild Bean Cafe. It's also a leader in biofuel technology. It's investing in solar technology. It's investing in wind. It's investing in emerging coal conversion technologies. And the list goes on.

You won't read about many of these efforts for the time being. BP is smart enough to keep the focus where is belongs, but there is more to the company than meets the eye. Where it is less adept, obviously, is in its ability to work beyond its internal sphere. Perhaps they think they are too big to do that nowadays. But they are not the only ones.

Generally, in the past, sometimes the federal government would be slow to take charge and delegate a national disaster. But ultimately, the federal government would. This time around, the crisis plan matches the PR plan. Every stakeholder in the oil spill crisis has its own message. And while it is said in many different ways, the underlying theme is "not me."

Other voices around the Web with a focus on communication.

• The Dirty Business of BP's Corporate Reputation Clean Up by Jennifer Janviere.
Its Fake Twitter Stream Has Twice the Followers of the Real Thing by Jim Edwards
How Not To Get “Brandjacked” Like BP Global PR by Olivier Blanchard

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