Why some PR arguments can't be won

Few came forward in defence of Stephen Hester, the CEO of the Royal Bank of Scotland, when it was announced he was to be paid a one million pounds (USD 1.5m) bonus this year.   The bank is effectively in public ownership (83 per cent) after it was bailed out by the Government.   Mr Hester was hired to restructure the bank and manage it back to privatisation.

The Chairman of the Bank, Philip Hampton, publicly waived his £1.4m share bonus, either to deflect criticism (it hasn't) or to avoid public vilification.

Mr Hester didn't start with the public rooting for him.   Banks did not fare well in the latest Edelman Trust Barometer (banks and the financial sector remain the two least trusted industry sectors for a second year), and even less popular than banks are....bankers.  They're seen in Britain by most as the cause of the current financial crisis.

Labour blames the Tories, the Tories say they inherited the contract from Labour. The public are telling politicians to intervene - we own the bank - the Tories are effectively saying they don't like to, but they've told the bank how much they disapprove.

The arguments for Mr Hester's bonus go like this:

1.  He is being bonussed with shares which do not pay out till 2014, so it is a long term incentive plan.
2.  Mr Hester took a drop in conditions when he came from his previous employer to come to the public service.
3.  If Mr Hester is successful he makes money for the taxpayer when the bank is sold.
4.  Mr Hester is doing the job he was hired to do, doing it well and is entitled to a bonus under his contract, if we didn't want to pay him a bonus, we should have said so when we hired him.
5. You would have chaos in RBS if Mr Hester left, and that wouldn't benefit the taxpayer (Iain Duncan-Smith).
6.  Mr Hester's pay reflects progress in categories agreed with shareholders, and strongly geared to the recovery of RBS (RBS statements)


The argument against are:

1.  Mr Hester is a public servant, and no-one in the public service should be paid this kind of bonus (in fact no-one at all should be paid this kind of bonus).
2.  It's not fair.
3.  The bonus highlights inequality in society (SNP leader Alex Salmond)
4.  It's not fair.
5.  RBS has failed to lend enough to small businesses (Matthew Oakshott, Lib-Dem MP)
6.  It's not fair.

This is a classic no-win situation for RBS.  It's easy to see why in the arguments above.  The arguments for Mr Hester's bonus are rational and linked to agreements the Government signed.  The arguments against are emotionally driven.  Putting it simply, the public doesn't like it.  They are under severe financial pressure and are driven by a feeling of "unfairness".   Defining "fairness" is of course an almost totally subjective exercise, depending on how much you are benefitting from the alleged fairness.

For example, the decision to cap public welfare benefits in the UK is seen as "fair" by those members of the public in work (and therefore funding it) and "unfair" by those in receipt of benefit.  If there's any rational argument that will shift these positions, nobody's thought of it yet.  On this and the bonus issue, the strength of public feeling for the welfare cap and against Mr Hester's bonus is overwhelming.

To all of the pro-Mr Hester arguments, the answer is always the same: "that may be true, but it's still too much and I don't like it."

Rational arguments, at least in the short term, do not win over emotionally driven reactions to issues.  That does not mean you should not make the arguments, but it is very important, too, to acknowledge the feelings of those who are on the other side of the argument.  You can only stick it out and hope that emotions will calm, or that someone else comes along with an even bigger bonus than you to take your place.  Or you can give in, effectively conceding you were wrong.   Even if Mr Hester did this, he'll get little credit from an angry public.

You build trust by your behaviour, not your words.

This is an issue that will be faced over and over again as Europe slides towards recession and large remuneration packages are revealed.   I haven't met anyone in the last week who supports Mr Hester's position.  The phrase you hear most often is "they just don't get it" and "I thought we were all supposed to be in this together?"

Instead, RBS are left with little option now but to meet an emotional reaction with a rational argument - and it won't work.

The late and deeply popular Queen Elizabeth the Queen Mother was not only someone who "got it" but who was an expert in public relations before the term was even invented.    She was famous for visiting bombed areas, especially the East End of London and the Docklands with The King.  But when Buckingham Palace was itself bombed, she famously said "I'm glad we've been bombed.  It makes me feel I can look the East End in the face."   She was really saying, "you see, we're all in this together".


STOP PRESS:  Just as this blog was published, it was announced that Mr Hester would not be taking his bonus following the public outcry.

"An Unforgettable Holiday with Costa" - the crisis lessons begin

"As soon as you step onboard, you will realise what an unforgettable experience your holiday at sea with Costa will be", extolled the Costa Cruises website, nearly 24 hours after 3 people died (at the time) and 40 were still missing in a catastrophe for the Costa Concordia.

There are many lessons to be learned from the Costa Concordia accident, both in crisis communications, and in dealing with passengers involved in an emergency.

"Having a robust crisis plan is not optional" - The Hon Mary Jo Jacobi Jephson

But the overwhelming lesson is that your organisation must be prepared for the unthinkable.   "Where loss of human life or serious injury is a possibility, having a robust crisis plan is not optional", veteran comms doyenne and ex White House staffer Mary Jo Jacobi Jephson has said.  "And where loss of human life or serious injury is a possibility, rehearsing your crisis plan is not optional."

"There are echoes of the Titanic" - Simon Calder

The Simon Calder Travel Show on LBC Radio

As veteran UK travel journalist Simon Calder told BBC News: “It is unbelieveable.  A lot of people in the cruise industry are just astonished that this should happen to a 21st century ship when everything is designed with safety in mind. There must have been an extraordinary sequence of events....the ship was listing dangerously and people were jumping into the water, and I'm sorry to raise this, there are echoes of Titanic which happened a hundred years ago.’

Your crisis plan must work in situations you think will never happen.

For Costa Cruises and its parent company Carnival, it seemed that even the things that could be planned for hadn’t been enacted.  24 hours after the accident it still appeared possible to book a cruise on the Concordia on the Costa Cruises site, with a cruise the following week round the Balaeric Islands being offered at less than half price.  The  front page of the Carnival Cruises (Costa’ parent company) website was still extolling “Look what the carnival breeze blew in” a day later with a tiny link to a statement about the tragedy at the top left of the page.

The pages were changed later.

So, an easy lesson.  Make sure that your organisation's website can be suspended in the event of a tragedy.  Prepare "vanilla" pages that can quickly be populated with information about what is happening and are right in tone.  When a ship with 4,000 passengers falls over, it's time to show that your priority is those who are affected.

After any accident, of course, there must be business continuity in the rest of the business.  But care, compassion and taste come first - always.

But it does require you to have a robust plan.  Involve your web and social media teams in every rehearsal - no exceptions.

It also helps not to have a public row with the Captain of a lost ship about culpability in public.  It can sound like you're trying to say "it wasn't our fault".  At best, extremely unattractive.   But more of that another day.

(Posted from London)

Wake up to what your employees are doing on social media

News that school districts in the US are banning teachers from having contact with their pupils (and in some cases ex-pupils) on social media has caused a rumpus.   Some say it is a restriction on free speech, whilst others point to the fact that 80 teachers in Missouri alone lost their licences in the last four years through sexual misconduct with pupils, some of which began on social media.  One district in Cincinnati in making a policy tried to make themselves look as if they were ahead of the curve.  They said social media was "growing" and they wanted to set a "forward thinking policy setting some parameters".  The "parameters" turn out to be a total ban on teachers relating to students on social media or via instant messaging.

This may or may not be a necessary policy.  I'm not qualified to judge.   But social media isn't just "growing".  It's here.  It's ubiquitous.  And students have been using it for several years.  Who invented Facebook again?  Oh yes, a college student.   Several years ago.

The dear folks of Cincinnati may be trying to dress up their slowness in getting a social media policy as "forward thinking" but at least they've got one.

I'm amazed as I speak at events round the world and ask delegates how many people do not have a social media policy for employees, how many hands go up.

The incident in 2009 at Dominos Pizza in the US, where two low-rent employees made a disgusting video at work which was posted up on You Tube (and viewed a million times within days) was a wake-up call to organisations that they need to discuss with their staff the benefits and risks of social media.  Dominos used the opportunity to re-engage with their staff worldwide on this topic.  Employees need to understand why rules are needed.  Few employees start work each day wanting to do a bad job, or wanting to badly damage the company.

When designing a social media policy for your organisation, talk to your employees first and listen to them.  You don't have the monopoly on wisdom.

Your social media policy will vary depending on the kind of organisation you run.

If your company is concerned with the preparation or service of food, if you allow camera enabled cellphones in the workplace, you are risking your entire business.  Employees should surrender their cellphones before starting, and reasonable use of the house phone for urgent family members is easy to allow.

Although less about social media, there are similar considerations if your employees use computer screens at work that show potentially sensitive information, such as financial information, which could be captured.

You should also think about whether you want to allow employees to say where they work on social media.   If they do, their behaviour, much of which is their business, will become yours.

In some jobs, because the employee is prominent or front-of-house, it may be obvious the person is your employee and they need to take special care in what they write.

A number of years ago a broadcast journalist boasted on social media of the number of women he had slept with.  It was such a huge number, you marvelled that there had been any time to appear on air.  The broadcaster thought it brought discredit to them because everyone knew who this individual was.

It's not just the fact that your employee works for you that raises issues, it's whether they talk about their life at work.  It might be fine, for example, if you run a cool coffee shop, to see one of the baristas enthusing about his work and his customers.  But what if he talks disparagingly about an especially irritating customer?  Or a co-worker that gets on his nerves?  Not so good.

In some companies, by talking about their life at work, employees can inadvertently disclose security arrangements, or private company procedures, without realising what they are doing.

One dedicated but exhausted US teacher sounded off on Facebook about her pupils (she had had a very bad day) not realising the privacy settings had changed.  What she thought were private remarks were seen by everyone, including her pupils.  Despite a blameless long career, she was fired.  Best not to talk about work online.

The important thing about having a social media policy for employees is not to restrict them, it is to make them think about what they are doing.  Employees on the whole like knowing what's expected of them. They like being engaged on issues so they understand the risks and how to get it right.

One of the first organisations off the blocks in the UK was the BBC, who were concerned in the early days of social media that staff might express political views on social media and threaten their reputation as a strictly impartial broadcaster.  Their social media policy is used by many companies as a template.

Develop your own policy, but do it now!



(Posted from Changi Airport, Singapore)

Liege and the importance of the press conference

The terrible aftermath of the shootings in Liege on 13th December are a reminder that all local authorities must have plans in place to deal with the unimaginable.

The press conference (above) held by the authorities on the 13th outlines the scale of the shocking minutes of terror, injury and death for local people.

The Straits Times in Singapore devotes a page this morning to a decade of shootings across Europe, including the 2010 attacks in Cumbria, North West England in which 12 people were shot dead, and the deaths of 69 young people on the island of Utoya, Noway in July.    The Straits Times calls the Liege shootings a "chilling addition to a long list of similar attacks that have blighted Europe over the last 10 years".  The paper notes the Liege shootings come alongside the shooting of two Sengalese men in Florence, Italy by a far-right author, who then killed himself.

The page provides ample evidence as to why every local authority must have a major incident crisis plan.  Any such plan must include potential arrangements for a press conference.   It's where things sometimes go wrong.

A press conference is an efficient and fair way to distribute information in an emergency.  It will establish your organisation as the authoritative source of information about the incident.  It is a way of dispelling rumour with facts.  It also enables you to publicly show care and compassion.

There are some useful things to check as part of your plan.

1.  Identify a suitable location for a press conference and an alternative should that location not be available.   It's a good idea to consult local TV colleagues who will be glad to help you with advice as to the suitability of a location for TV positions and links.  Remember today most 24 hour news channels will carry press conferences "live" and will not thank you for holding them in a location which makes this difficult.  The venue needs to be co-operative enough to make itself available at very short notice, so it is better, but not essential, if it is a public building.

2.  Your venue must be suitable in size and dignity to host a press conference which may be to announce large numbers of deaths.   Think about whether there can be a raised platform, and a raised platform at the back for TV cameras, and whether you can have a backdrop (in London the Metropolitan Police do this very well).  There is no time to do this on the day.

3.  Identify the personnel you would need - types and numbers of people - and don't forget you will need security to ensure only authorised media are admitted - be careful that there may be people who wish to disrupt the event.  You will need staff to record the names of those attending, as you may wish to contact them afterwards.

4.  Work out how you will advise the media that there is to be a press conference.  Be careful not to commit too far in advance as you will lose credibility if a press conference is trailed on TV and doesn't happen.  The media are entitled though to adequate notice to make technical preparations.  It's helpful to tell media, for example, that while you don't know the exact time of a press conference yet, if there is one it will be in "x" building.  Then they can begin logistical preparations.   But be careful not to promise a press conference which may not happen.

5.  Have "toblerones" (name cards for tables) ready to put participants names on them on the press conference table in your crisis tool box.  Most media present will not be familiar with the participants and it helps TV viewers, too.

7.  Training - it's very important that as part of crisis training, you include training in handling a press conference.  Mock press conferences are easy to stage and senior officials should be mandated to attend this type of training at least once a year.

These arrangements will get you off to a good start in the event of an emergency and will help you avoid some basic pitfalls - like holding press conferences on a pavement, which should never happen.


(Posted from Singapore)

Product tampering always an emergency

News breaking on 30 November that customers of a Walmart store in Cartersville, Ga, US, have pricked themselves with needles hidden in clothing products was yet another example of product contamination and the need for companies to respond quickly to such an event.

14-year-old Courtney Worthington was trying on some pyjamas bought for her by her mother in the Walmart store when a hypodermic needle pricked her finger and foot in an alarming incident for the teenager. A second shopper, Patricia Heidrick, reported she had been pricked by a needle hidden in women's apparel at the same store.  Further needles were found in other clothing products.

Apart from the injury, the risk of contracting HIV from a contaminated needle (should they turn out be to be so) is real.  Post exposure prophylaxis treatment should be given within 72 hours of suspected or possible HIV infection (and preferably within one hour) and it is expensive.  Monitoring over a period of months is required.

Walmart responded quickly.   They said they believed this was confined to one store.   There was initial confusion as to whether the company would pay the customers medical costs relating to the incident (a big issue in the US where costs are high - one estimate is USD 1300 for the prophylactic treatment alone).  According to one report,  Mrs Heidrick said Walmart wouldn't talk to her about medical costs.   A Walmart spokesman said  "Walmart has reached out to Ms Heidrick.  If any our our customers were harmed, we will gladly pay for any valid expenses."

The tampering so far does appear to be confined to one store and it's not yet clear who is behind this potentially serious criminal action.

What are the principles when handling product tampering or contamination?

They were established in the Tylenol crisis in the 1980s in the US, a defining moment in dealing with product tampering.

1.  Customer safety must come first.  If there are suspicions of tampering, immediate action to protect customers must come before anything else, whatever the price tag, if you want to maintain trust in your brand.  Amazingly, on December 6, more needles were still being found in clothing at the store.  The probability is that the metal detectors being used to check stock were not sensitive enough to pick up the needles (or the culprit was still planting them).  Either way, it's not good news for customer trust in Walmart.  Close the section and search the items one by one, by hand if necessary.

2.  If you are a chain, you must have a clearly understood emergency system of alerting all branches if tampering is suspected.

3.  If you sell something, even is tampering is not your fault, it is your responsibility - so be seen to take responsibility for sorting it out and protecting customers.

4.  Care and compassion are the guiding principles of dealing with affected customers.  Ms Heidrick didn't seem to feel she had Walmart's full support.  The word "valid" in Walmart's statement is odd.   I would have made this statement unequivocal.  If a doctor recommended prophylaxis (which they may not, there are significant side effects) I would have paid for it without question and I am sure Walmart will.  Try to make unequivocal statements.

5.  Walmart did the right thing by getting out there and making clear public statements.  They may have had police advice that it was likely this was an isolated incident and it's reassuring to say so, but be careful.  Like the Tylenol crisis, the trouble may spread and then your credibility is damaged.  This story was active on Twitter with alarmed customers, it's not immediately clear that Walmart were involved in the conversation.

6. It's important you tell customers afterwards what you are going to do to prevent the issue happening again.  In this case, that is going to be difficult.  After Tylenol, tamper proof medicine bottles were introduced which gave the public confidence.

Walmart is a giant company with a strong reputation.   They have incidents and a well-oiled machine for dealing with them.  So far it looks like this incident is contained.   It's important not to over-react in where the situation is a local one, but the health and safety of your customers must always be your first priority.  If you do not have their trust, you have no business.




(Posted from Singapore)

The power of explanation in a crisis

In a crisis, people are more likely to co-operate with instructions if they know the reason why.

On an overnight flight from London to Dubai this week on the way to speak at the IQPC CMO Congress, our sleep was interrupted by a call over the PA.  "If there is a medical doctor on board will you please make yourself known to a member of the crew."   (I'm often surprised that there is almost always a doctor on board every aircraft - there are either a lot of doctors in the world, or the ones that there are travel a lot).  There was a medical emergency with a passenger.

A doctor duly came forward and the decision was taken to continue to Dubai, where we were met by an emergency medical team and ambulance.

Have you ever noticed that when a plane reaches the gate, people seem to leap out of their seats as if a spring had propelled them upwards?  They rush to get their stuff from the overhead lockers like their lives depended on it.  Then they stand in the aisles for ten minutes waiting for the airbridge to connect.  It's a global ritual, and people are very competitive about it.

On this occasion, the pilot came on the PA as he taxied from the runway. He explained that a passenger had been involved in a medical emergency and we were going to be met by a team.  Would we all help by staying in our seat with our seat belts on so the team could have free access to do what they needed?

And everybody did.  There were no complaints, no muttering and no tutting, even though people's sleep had been disturbed and we were feeling a bit crotchety. Because the passengers knew that by doing this they were helping the sick passenger and the crew.

It struck me that this is also true in a crisis.

In an emergency, of course, your message has to be very simple.  If the building is on fire, the fire alarm is a way of shouting "get out" at people.  No need for pleasantries.

However, in many crises, the need is less obviously so urgent.  It's important we tell people why we need them to do things.  In the 7/7 London bombings, for example, we asked people to stay in their buildings and not go on the street.  We explained this was because there could be other bombs.  They understood the reason and they stayed in.

A simple explanation can be very powerful.  "Do this" and "this is why".  Unless there is a threat to life -  then it can just be "do this" but later when things are calm, tell people "why" you asked them to do it.



Arriving at the Ritz-Carlton hotel in Dubai at 8am I was exhausted.  The bell boy beamed. He got my name from my luggage tag and addressed me personally. I got to the reception and told the receptionist I was dead beat.  A broad smile broke across her face. "That's something we can fix right away", she said.   OK, it was the Ritz Carlton, but the cheapest of hotels can manage a smile.   It's one of the most powerful communication signals.  And it crosses every language and cultural barrier.

(Posted from Kuala Lumpur International Airport)

A headache for Nurofen Plus and the lessons from the Tylenol crisis

Allegations of contamination or tampering are an emergency for a pharmaceutical company.

The core element of every reputation is trust, and the trust bar is set very high indeed by consumers when buying or being dispensed drugs in the pharmacy.

The most famous example of this was the Tylenol crisis in the United States in 1982.  Tylenol was the most successful over the counter medication, with over 100 million users.  It was discovered that someone had placed capsules in boxes contaminated with deadly cyanide.  Seven people in Chicago were reported to have died after purchasing tampered boxes and taking the medication.  How the company dealt with the crisis has become one of the most famous example of crisis management.  It could have finished the company which made Tylenol, Johnson & Johnson.

--------------


Now it's been reported that 5 boxes of Nurofen Plus in the UK made by Reckitt Benckiser contain prescription only anti-psychotic or epilepsy medication.  If it is sabotage, it's not yet clear why someone is doing this.  No-one appears to have been harmed by this, and doctors say the risk is low.

When I began my career in Britain's National Health Service, a study of a new pain-killing wonder-drug was being carried out on the medical wards.   The drug Ibuprofen was so successful in patients with the severe pain of chronic arthritis that some physicians were calling for the study to be curtailed and the drug to be licensed without further delay.   It both relieves pain and is anti-inflammatory. The drug became commercially known as Nurofen and is now available over the counter.  We take ibuprofen for granted but it is a remarkable and useful drug - and very safe.

It's important to know that Nurofen is marketed as Nurofen, Nurofen Extra (which is simply higher dose ibuprofen) and Nurofen Plus which is a capsule mixed with Codeine to deal with strong pain, for example after a dental procedure like an extraction. (Nurofen Plus is not available in countries which prohibit the import of medicines containing codeine).  The present recall only affects Nurofen Plus.

In a major operation, all packs of Nurofen Plus have been recalled from pharmacies and consumers are being asked to bring any packs they have to their local pharmacy.

A product recall is highly expensive for a company.  In this case the company ordered an immediate product recall.   It was the right thing to do.  No consumer will buy medication they think may cause them harm.  The huge expense of a product recall is necessary for public safety, but also to protect the brand's long-term reputation.  In this case the recall has knocked the story off the news agenda.

The recall is a reminder of the lessons learned in the Tylenol crisis in the early eighties.   Andrew Gilman  was one of the team who worked to restore the reputation of Johnson & Johnson after the crisis.

It is such a powerful crisis lesson that he returns to it again and again, including in his blog.

When a company is faced with a possible contamination problem, what are the crisis rules:

1. First of all, consumer safety always comes first, last and always - as Reckitt Benckiser have demonstrated by their actions.

2. Secondly, take control, or someone else will.

3. Go beyond what you are legally required to do.

4. Spend money and effort getting information out there quickly. Don't hide from the media.  The Andrew Gilman lesson: transparency and clarity.

5. Contact people affected.  Care about them.  Not just for PR.

6. When the problem is resolved tell consumers what you've learned and how you will prevent a recurrence (In the Tylenol case, investment in new tamper-proof designs).

The cost of all this might nearly break the company.  But the sentence for companies who fail to respond is oblivion.

Consumers judge your company not on what happens to you, but how you respond to it.





(Posted from London)