legendsin-their-lunchtimes

Legends in their lunchtimes

As the basket at the foot of the AMP guillotine begins to fill, for those of us who have had the privilege (or curse) to have been active in business for more than 3 decades, the unfolding events appear all too familiar.

Hubris, and wilful blindness have never combined to end in a positive result. Never-the-less, both tend to manifest as part of a regular business cycle.

An outbreak of believing your own PR is likely to resulting in mounting casualties.

Business success depends not only on sound strategies – well executed – but, annoyingly, on a degree of luck, timing and a supportive broader social and regulatory environment. Too often management and boards can mistake a fair proportion of the latter three (delivered by regular variations in business and consumer confidence) for their own genius.

The resulting natural tendency is to lessen the focus on detail and begin rewarding one another for the job well done. A tendency naturally increased if it is other people’s money that is being used.

The mess uncovered at the AMP is almost certainly the beginning of a long stream of hubristically driven shambles that the, much delayed, Royal Commission into Misconduct in the Banking, Superannuation and Financial Services will bring to light.

The damage to personal and corporate reputations will, in some cases be irreversible and in most cases, take long periods to recover from.

Two things confound and disappoint the public and work to lessen an organisation’s social licence to operate. First, the evident avarice-driven disregard for rules and customer benefit. Second, the failure of boards, as houses of review and management supervision, to identify and act on such abuses.

As professional communicators, we are regularly asked to convey good news and minimise poor outcomes when engaging with ‘stakeholders’ (read anyone who can impact on a share price that drives bonuses or who can tip folks out of a job). Both on principle and in the longer-term interests of our clients, we never knowingly misrepresent the facts. We may focus on one element more than another, but to lie is to ensure you will, eventually, get caught-out. An outcome that damages all involved.

Board members of any public company, industry body, not-for-profit or other such organisations have a responsibility to ask management the difficult questions, to challenge assumptions and, where necessary, to check the detail. Even if all is presented, on the surface, as good news.

In getting to the facts, too often we have witnessed situations where process is relied upon rather than proper answers. Instances where to us, as so-called spin masters, it is obvious that either not enough substance is present and/or too much pre-spin has already been applied.

Thankfully, few such cases have involved our existing clients. But we have worked on quite a few crisis management cases where the damage has already occurred.

Business cycles have, even in our relatively short experience, displayed a predictable regularity. A longer view of business history does not support an alternate conclusion. Executive management and boards should, in good times and bad, take a close look at how their businesses operate, how they generate the results, consider the prevailing conditions and ensure that they are well insulated from possible ethical, regulatory and operational failures.

If that is happening, the task for the communicators is to tell a good story, well. If not – welcome to the town square, with the crowd baying for blood. The most that can be done at that point (at great expense) is make the best of bad situation and prepare the ground for the successors.

RMKA_BAD-BITE-TO-REPUTATION_web

Bad Bite To Reputation

In industries of high public trust reputation is of critical importance. The food industry is a prime example. Food poisoning is on a very steep rise. It is estimated that it has leapt almost 80 percent in a decade. And it can impact any part of the food industry – from restaurants to food processors and manufacturers – all are vulnerable to reputational damage. With schools and businesses now coming back on stream there is heightened potential for damage.

Each year an estimated 5.4 million Australians are affected by food poisoning, including 120 deaths and more than 1.2 million visits to doctors. The estimated annual cost of food poisoning is $1.25 billion and the number of lost work days is 2.1 million.

In OzFoodNet’s most recent nine-year survey period they linked 68 food poisoning outbreaks to eggs alone with 1404 Australians ill, 322 hospitalised and two deaths.

And in the current three-months period – the Christmas/holiday season – there have been 14 food recalls, ranging from Mexican Salsa Peanuts to pancakes, hash browns, cider, cheese, biscuits, bread, beans and beetroot.

Behind each of these is a company whose reputation is now damaged. The consumer has doubts about the veracity of the product, as well as the hygienic nature and standards of the manufacturing process.

History is littered with companies which have collapsed because they have not managed the situation, nor their reputation effectively.

This is where token food recall crisis management ‘on the fly’ and ‘let’s keep our heads down’ attitudes can do irreparable damage to a company. This approach does not ‘cut it’ in today’s media and voracious social media world.

The traditional media, now often led by social media, can become a nightmare for unprepared companies. A single tweet can turn an issue into a full-blown crisis of global proportions.

Companies have no basis to think they can get away with it. Unfortunately, investment in preparedness is still neglected today, despite the facts.

The adage “fail to prepare, prepare to fail” is typical of many companies. They are paying lip service to having a crisis plan, having it tested and having it maintained for currency.

But doing ‘the right thing’ by consumers and the community, plus putting ‘reputation goodwill in the bank’ can only be achieved by an effective crisis plan and preparedness for an issue.

RMK+A has more than 30 years’ experience in preparing companies for crises and in dealing with  issues, as well as developing and testing crisis plans.

donaldtrump2016

Trumpocracy – the 101 Lesson for Communicators

Who was it that said: there are none so blind as those who will not see?

Maybe it was the Huffington Post, which reported of Hillary a day before the US election: “She’s got it!”. Or the New York Times, whose election-eve odds were 84% favouring a Clinton White House?

Ok, let’s not be too cute on the morning after, when all has been revealed and it’s easy to say, I saw that.

For the record, I didn’t see that.

But far more significantly, those self-assured and self-described indefatigable seekers of Truth – the entire American 4th Estate – didn’t see that.

Never have so many witnessed so much, so closely, for so long and seen so little.

But the outcome is not just a critique of media or journalists; rather there is a truly vital lesson for professional communicators everywhere.

This is a lesson in top down communications and engagement, versus bottom up.

The American media turned its full skill, experience and attention to reporting, analysing and interpreting; essentially commenting and telling the American people what was going on.

You get the model? We (the media) know what’s happening; we give you (the people) the benefit of our stunning insight, opinion and wit.

Yeah, right!

We talk these days about the importance of engaging, understanding and enfranchising. That applies to the public, whether it be stakeholders, communities, customers, clients … or voters.

But in hindsight what the American media didn’t do is clear – and also, for that matter, what the UK media didn’t do in the Brexit debate. It didn’t stop, ask, observe and listen, instead of tell, tell, tell.

This is the essence of good modern communication. It is about understanding first, then talking.

Governments in Australia and around the world, and to some extent Corporations, are learning this – sometimes the hard way.

But if there’s any real lesson from the US election for communicators, it’s that engagement, consultation and enfranchisement are not just the latest buzz words for the same old same old.

Things must truly be done differently in 2016.

We are a long way from the idea of developing a position, turning it into simple key messages, pumping it through news media and, if they don’t listen, buying space to time to say our piece.

The message no longer comes first. What comes first is … the open ear.

Engagement means listening and hearing, looking and seeing, and mostly shutting up yourself.

Things change slowly, of course. Organisations still expect a thing called a “communications strategy” that has positions, statements, and all the key messages tied up in a neat, pretty bow.

After Trumpocracy, and Brexit, the opportunity is for communicators to educate their paymasters about why they need a strategy that first gives the microphone to their audience – and starts with a key messages page that is blank.

dreamworldspecial

Nightmare in Dreamworld

The deep Dreamworld tragedy is now the nightmare that may not be forgotten or forgiven.
Equally, the reputation wreckage left in the roiling wake of that Thunder River Rapids ride was avoidable. What was needed amidst chaos were clear, and above all, human and humane thinking. Not easy, no. But necessary and totally expected from highly paid executives.

Of course, we don’t know the full deliberations of Dreamworld or the advice it took or rejected.
We only see the public result. From that it’s hard to know why the plainly obvious can remain so apparently unseeable to decision-makers in crisis, as they react – perhaps inadvertently – to deepen pain and destroy their reputation.

This crisis was bad and tragic. The disastrous effect of the bad response was totally foreseeable.
Dreamworld’s CEO started sensitively, with a quick statement after the event declaring that all efforts were bent to helping authorities, and all thought and hearts were with family and friends.

I’ve seen enough executives gripped by crises to know these feelings are sincere.

After that, things plummeted. In the Dreamworld bunker, the world must have been spinning so fast they probably felt they had no time to reflect fully on the humanity of their decisions. It truth, the executives may not have appreciated well enough how to manage the time they had.
Crises are awful, for sure. But their public unravelling, and searing media scrutiny, follow a pattern.

The first part, typically the first 24 hours, is about acknowledging tragedy, immediate condolences, unconditional co-operation with investigators, and the facts: what happened; what are the casualties; how big; what is happening now. Dreamworld did this quickly. The second part, the next day or so, is about the human face and grief: the victims and families, the scene pictures and videos, the stunned witnesses, the scene aftermath. The last part, which can take weeks, months and years, is about speculation, fault, blame, legal cases and recovery. Being clear-headed about these phases is not to diminish the tragedy, but rather to create space to respond sincerely to it.

What does this mean for Dreamworld, and why did they crash their own crisis response?

While within hours of the disaster the CEO was rightly expressing his shock and pain for victims, families, patrons and staff, internally Dreamworld needed to focus completely on day two.

Had they fully understood that every flinch of their corporate face would be interpreted mercilessly against the rawness of human grief, they could have demonstrated their sincere organisational grief accordingly. Measured against the tragedy, even the whiff of re-opening the park could only be interpreted as unconscionable. While the intent was to offer a memorial event, the effect signalled an untimely rush to reopen for business.

Keeping the victims and families as their priority, Dreamworld apparently overlooked that the only conceivable reopening or memorial event could occur only if families of victims explicitly requested it, and then only as they wanted it – and with police and safety inspectors’ endorsement. Further, that the CEO of parent company, Ardent, could be financially rewarded (a bonus) during this crisis, even if for retrospective good work, is mind boggling. Would a carmaker choose a horror fatal crash as the moment to laud the safety advances of its chief engineer?

It might be said that this is hindsight. But here’s some foresight.

Dreamworld’s nightmare is not over yet. Mercifully, Ardent finally conceded that they did not get their response right. They still have the aftermath to manage, the on-going blame, the leaks, the speculation, the recovery, the legal case all to come. Will they shut down? Or will they open?
Here is the really tough bit. Now is the opportunity for Dreamworld to redeem itself, somewhat, by being as transparent and open as possible. Yes, they need legal advice. But another error in crises is to rely too heavily on legal advice that is focussed predominantly on limiting liability. I don’t offer legal advice, but reputational advice suggests that Dreamworld must consider quickly how it may more publicly and practically demonstrate its regret and apology to families, staff and patrons and show continuing sincere empathy.

Is vowing to run one of the safest parks enough? What were they aiming for before?

To repair some trust, they must show patrons and community that they are trustworthy. That means even  if  they find a weakness in practices; and how they could commit to making their own internal investigations fully public.

It is about demonstrating honesty and openness when it hurts the most, even if it costs money in the short term, because you can almost guarantee it’s going to cost that and more in the long term.