Chapter Contents
2. Introduction
A dictionary definition describes the word ‘crisis’ as ‘a time of great danger, difficulty, or confusion when problems must be solved, or important decisions must be made’ (Oxford Learners Dictionaries). Fink (2000) sums up a communications crisis as occurring ‘when an event increases in intensity, falls under close scrutiny of the news, media or government, interferes with normal business opportunities, devalues a positive public image, and has an adverse effect on a business’s bottom line’.
All over the world, crises are happening to people, businesses and governments every day on both large and small scales. Irrespective of size, a crisis could be defined as a serious incident for an organisation or a person that has the potential to affect the reputation of the organisation and ultimately impact on its bottom line. For example, at the time of writing, countries worldwide are tackling the Coronavirus Pandemic, which is a global crisis that threatens both the health and the economies of the worldwide population. It presents multiple crises, for businesses, for governments and for healthcare providers worldwide and presents huge challenges in crisis management and communications in terms of changing behaviours and
attitudes (a case study on COVID and communications will be included in this book). There are numerous other crises that have occurred however that might not be as instantly memorable but important for the organisations involved nonetheless. For example, in 2018, the fast food chain, Kentucky Fried Chicken (KFC) experienced a crisis in the UK when it ran out of its core product - chicken! The company was forced into a crisis communications strategy as a result, which it handled very well and is discussed later in this chapter. Goya Foods, the latino food producer had a crisis in 2020 when its Chief Executive, Robert Unanue lavished praise on the then US President, Donald Trump at an event in the White House. The Latino community in the States expressed their outrage on social media highlighting that Trump’s policies were responsible for numerous injustices against the Latin American community. As these issues gain attention on social media initially, they have the potential to spread and get worse for the company, its reputation and ultimately its bottom line, very quickly unless a well-executed crisis communications programme is immediately actioned.
When analysing a crisis from a communications perspective, it is important to make a distinction between crisis management and crisis communications. These terms are commonly used interchangeably and erroneously. Fink (2013) attempts to explain it when he states that ‘crisis management’ is ‘the management of the realities’ and crisis communications is ‘the management of the perception of the crisis’. Crisis management is a process an organisation will hopefully have engaged in long before a crisis hits. It involves a risk assessment of potential crises that could affect an organisation and scenario-based simulation training around such crises. For example, an oil company may look at an accident on an oil rig as a potential crisis situation and plan with and train its staff to respond to such a disaster.
A technology company might look at a potential breach of data as a risk to the organisation’s business and might train its management team in responding to such a crisis. The crisis management process should include a detailed analysis of best practice in managing such crises looking at precedent within the organisation and amongst similar organisations, and the development of a plan of action in the eventuality of such a crisis occurring in the future. Topics of concern for an organisation involved in crisis management planning would include: deciding on the members of the crisis team, identifying the departments of the business that could be affected, human resources issues particularly if the crisis could result in redundancies or lay-offs and legal issues especially in some large crises where customers may be entitled to compensation. These are all operational crisis management issues and ones that take place under the remit of crisis management.
Crisis Communications on the other hand becomes active after a crisis has materialised but should also form part of the management planning process. The main concern of crisis communications is the public response of the organisation to the crisis. The communications
has the ability to protect and in some cases even enhance an organisation’s reputation. This is important because reputation is recognised by companies as hugely important to their value.
For example, an article in the Harvard Business Review states that markets believe that organisations with good reputations ‘deliver sustained earnings and future growth’ (Eccles, Newquist & Schatz, 2007). This is further substantiated in a study from global market research company, IPSOS. In its 2019 report on the value of reputation, it found that 87% of consumers around the world say that they take the reputation of the company into account when purchasing a product or service (IPSOS, 2019). Unfortunately however, in many cases, despite the unlimited finances and resources that organisations have at their disposal, many organisations cannot build or maintain a good reputation. As Warren Buffett famously said: ‘It takes twenty years to build a reputation and five minutes to ruin it’ (Snyder, 2017). Starting with a good crisis communications plan is the first step in ensuring that your company is best placed to protect its reputation if and when a crisis hits. At the very least, the organisation should not make the crisis worse through poor communications. An example of a company that did just this was BP (British Petrolleum).
There is no book or article on crisis communications that can be written without mentioning the communications of BP and in particular the performance of its CEO in the aftermath of the largest oil spill in US history and one of the worst environmental disasters of all time. In 2010 there was an accident at the BP oil rig in the Gulf of Mexico that, according to the National Geographic, resulted in the leakage of more than 300 Olympic sized swimming pools of oil into the sea, destroying marine life and polluting the waters and beaches throughout the Gulf of Mexico (Borunda, 2020). Eleven people died in the incident and the local fishing industry was decimated by the accident. The Chief Executive of BP at the time was Tony Hayward and he was dispatched to front the crisis communications campaign to try and protect BP’s reputation. However, to the untrained eye, it would seem that BP’s communications activity was designed to do exactly the opposite. From the outset, the company was accused of covering up the real story. It gave vastly underestimated figures of how much oil was leaking into the sea to the public, it was unable to give a timeline as to when the leaking might stop and was obstructive in allowing media access to the areas affected. In a television interview a month or so after the disaster, Hayward stated that ‘the environmental impact of this disaster is likely to be very modest’ and he famously told one journalist in an interview that there was no-one who wanted the crisis to be over more than him as he wanted to have his life back!
BP’s strategy and Tony Hayward’s performance were shocking for an organisation that was in the midst of a reputational crisis to the extent that it would leave experts wondering how they got the crisis communications so wrong? Clearly a company this large had trained for such an event? The answer would seem that the company was completely out of touch and
out of its depth in terms of the scale of this disaster and was unable to pivot its communications strategy to one of transparency and truth, which was what was required. A demonstration of empathy was also sorely lacking in the personal interactions from Tony Hayward. Empathy is a key component of crisis communications and we will look at this in more detail in the ‘Crisis Communications Checklist’ later in this chapter. The crisis cost BP billions and Tony Hayward was eventually replaced in his position by Bob Dudley who said in a BBC interview shortly after his appointment in 2010: “We will earn back trust in BP and begin to restore the company’s battered reputation” (Madslien, 2010). Dudley then set about a post crisis communications programme in which the company attempted to provide up to date information as to the stage the attempts to fix the leaks was at and the steps BP was putting in place to ensure this wouldn’t happen again. The extent of the damage caused by this disaster is still being uncovered to this day over 10 years’ later.
Whereas Crisis Management’s focus is to prepare an organisation for the logistics of managing a crisis, crisis communications is about protecting the reputation of an organisation in the event of a crisis occurring. Crisis communications planning will help an organisation to develop explanations for its stakeholders, to communicate key points on what the organisation is doing to mitigate, give clear facts and dates to the public as to the stage of the problem and explain how the organisation plans to prevent similar crises happening in the future. In a well-managed communications-savvy organisation, the communications aspect of the crisis will have formed part of the crisis planning strategy and a well thought out public response will have been anticipated and developed. The ultimate goal of a crisis communications plan should be to communicate the details of the crisis clearly and not to further damage the reputation and revenues of the organisation involved. In some cases the crisis communications can even improve the reputation of an organisation. For example, in the Kentucky Fried Chicken crisis, the company responded immediately through a clever social media campaign which became a positive reputational campaign in itself. When it became public knowledge on social media that the company’s outlets were closed as it had run out of chicken, it took to social media to immediately apologise to its customers and explain that there had been an issue with its new courier company that had resulted in the failure of the chicken to be delivered. The new courier company then verified KFC’s claim and the company succeeded in projecting an image that was pro-active and one that had good relationships with its contractors - all key attributes of a good reputation. Next, the company set up a webpage and developed a humorous campaign on social media entitled #wheresmychicken that went viral. This was an immediate, transparent and humorous response that worked well for this company. It is important to note that this type of response would not be suitable in a more serious situation in which the crisis involved a loss of life for example or a major
environmental disaster as such that had occurred with BP. However, no matter the magnitude of the crisis, immediacy and transparency in all situations are key to the successful execution of a crisis communications strategy.
To look at the origins of crisis communications we can go back to the early 20th Century when Ivy Lee, one of the first public relations practitioners and considered to be one of the founders of the public relations profession, drafted the first known example of a press release. The press release was composed in response to the Pennsylvania Railroad train crash in the US in 1906 in which 50 people lost their lives.. At the time of the crash, transparent communication from organisations to their stakeholders was not common practice. On the contrary, businesses were fearful or sceptical about the media and would commonly opt to hide information and avoid communicating with their stakeholders until such a time as the media came looking for answers. However, Lee’s response to this crisis changed this practice. He drafted a statement updating the public as to what had happened and what the company was doing in response and he invited media to the crash site to report on the incident. His press release was published by news media, including in the New York Times and Lee then went on to publish his ‘Declaration of Principles’ which laid out the foundations for future public relations professionals and organisations in how they could communicate in an informative and transparent way with the public through the news media.
Although the types of crisis and processes of crisis communications have evolved with the time that has elapsed since the Pennsylvanian Train Crash, the basic principles of the communications response as laid out by Lee, including transparency and honesty have remined the same. Probably the most significant factor that has influenced crisis communications since the time of Ivy Lee and particularly in the last 15 years, is the emergence of new technologies and new media channels through which news is consumed and which has resulted in increased and immediate access to news. Both bad and good news now enters the public domain immediately through social media and that has placed an increased onus on companies to be prepared and to respond quickly. To illustrate this point for example, if the Pennsylvanian Train Crash had happened in 2020, almost as soon as it had happened, either a passenger involved in or a spectator to the crash would have posted about the crash on Twitter and the news of the crash would have instantly become public knowledge. In this instance, Ivy Lee would not have had the luxury of drafting a press release for the next day’s newspapers. Rather, a journalist would most likely have been on the phone to Lee within the half-hour looking for a comment. In a further illustration of this need for immediate communication in a crisis, in 2015, the American railroad company, Amtrak was ridiculed for its response to a train crash in which eight people died and numerous others were injured. The company was heavily criticised for its uncoordinated response and its failure to
engage quickly and responsibly through the media, including social media, in the immediate aftermath of the accident. This led the author of an article on the crash in PR Week to pose the question ‘when are companies and organizations going to learn that effective and immediate communications are a must-have in a crisis, not a nice-to-have?’ (Barret, 2015).
The importance of being prepared and the immediacy of response are key factors for organisations and public relations professionals to consider in their crisis communications planning.
Companies both large and small should engage in a crisis management strategy and incorporate communications into this strategy. The larger the organisation and the more risk the organisation takes, the greater the need for a crisis plan. A clear communications strategy is required to address each of the potential crisis situations identified and a spokesperson is required to be trained in media relations prior to the crisis event taking place. This will ensure that the company is best placed to respond to a crisis and ensure that at the very least it can protect and maintain the organisation’s reputation in a time of crisis and avoid making the crisis worse through poor communications. An analysis of previous crisis events combined with crisis communications theory will inform a crisis communications programme ensuring it is grounded in best-practice and research.