Some NGOs court controversy and engage in political theater to promote their causes and fill their coffers. Until this week, the Susan G. Komen Foundation, the leading breast cancer charity, was mostly known for pink ribbons, hot pink adorned athletes, their Races for the Cure across America and efforts to promote breast cancer screening and finding and battling the disease. All that changed with the announcement of the organization’s decision to cut funding to Planned Parenthood. The news unleashed a torrent of opposition to Komen from cyberspace to Capitol Hill and has proved a monetary godsend for the beleaguered Planned Parenthood.

Though the drama continues to play out, it quickly damaged the reputation of Komen, with organization executives resigning in protest, women throughout the country cutting up their pink ribbons and Komenwear, calls for boycotts and politicians racing toward microphones to opine on the decision From a crisis communications aspect, an organization needs to war game the potential public reaction for any controversial announcement (and first appreciate what in fact will be controversial) and be prepared for potential reactions among all its stakeholders. This can help decide what and how to communicate. For an otherwise incredibly savvy- marketing Komen, there seems to have been a serious lack of planning here or appreciation of the impact of the news.

The initial rationale for the decision that was floated tied the defunding to new criteria which barred grants to organizations under investigation. For Planned Parenthood, this was a seemingly politically motivated investigation by a conservative Republican Congressman. Thus, Komen was catapulted into the center of an election year scrum amidst passionate politicos of all stripes. With social media already hyper-buzzing, Komen added even more fuel to the flames with a poorly scripted and stiffly delivered defense of its action on its Facebook page.

As the controversy took over the airwaves and digital media (with Planned Parenthood reaping the benefits of the media onslaught and a rush of new contributions), Komen committed perhaps an even bigger communications gaffe. It changed its story. Yesterday, Komen founder Nancy Brinker, grimly and combatively did the cable TV circuit, to offer a new rationale for the funding cut and equivocate a bit on what the decision meant to future grants for Planned Parenthood. The reason du jour was now Komen’s desire to support groups that directly provide breast health services and that Planned Parenthood only provided referrals.

Earlier today, Komen reversed course. 

It apologized, asked for peace, pleaded that it did not cave to political pressure and indicated that it would fund existing grants to Planned Parenthood.  What the finely crafted statement (better than anything it did previously) did not say was if Planned Parenthood would be funded in the future.  Though contrite, Komen still seems to be giving itself some wiggle room down the road.  This fire fight may not yet be over, but it is already offering lessons in what not to do from a crisis communications perspective. In time, we will be able to gauge the effect on Komen’s standing and the multi-millions it raises each year and whether its serious stumbles in terms of communications and issues management, from before it even made an announcement through the seeming squishiness of its apology, will cloud its future…

rtauberman Crisis Communications Planned Parenthood, Susan G. Komen Foundation

Winners:

Planned Parenthood – who may get some reprieve from being the poster child for abortion and re-cast for what they are – a provider of women’s health services – and one that heavily serves poor and uninsured women — a population of women who often have few options for healthcare.

Former Komen Exec Mollie Williams – who got out of dodge before things got ugly and has handled media inquiries with dignity and grace.

Mike Bloomberg – who personally pledged to match donations to Planned Parenthood for Cancer screenings up to $250,000.

Serendipitous Beneficiary – The American Cancer Society – long respected for their work to combat the dreaded “C” word – they have the opportunity to “take back” breast cancer as their own, and mobilize support from the people who still want to fight cancer, but don’t want to support the Komen Foundation.

Losers:

No surprises here - The Susan G. Komen Foundation, and the research that may see a decline in funding if support for their efforts dwindles.  You have to question whether ceasing a $600,000 grant – a drop in the bucket for both organizations – was worth the reputational damage.  

Women – Millions of uninsured and low income women who rely on Planned Parenthood for their healthcare needs, including cancer screenings.

The employees of Susan G. Komen Foundation – When the sex abuse scandals of the Catholic Church were on the front page, a priest friend told me he was ashamed to wear his collar in public for the first time in his life.  I would imagine that many of the employees at the Foundation work there because they passionately believe in this cause.  Overnight, they’ve gone form walking tall and proud because they work for the gold standard to defending themselves and their employer.

Collateral Damage – The color pink is no longer the new black; but the pink ribbon may be the new Scarlet Letter.   Pinkwashing is the new greenwashing.

gb_admin Crisis Communications American Cancer Society, Mike Bloomberg, Mollie Williams, Planned Parenthood, Susan G. Komen Foundation

I often say that good communications is not an effective remedy for bad policy.  When trouble hits, everyone suddenly needs “communications help.”  But communications can only change perception if you’ve fixed the underlying problem.  Case in point:  the Susan G. Komen Foundation.

I remember when the Susan G. Komen Foundation came on the scene.  It was early on in my PR career, and every client I had wanted to partner with them – almost as fervently as they wanted to be on Oprah. Soon we had pink everything – from KitchenAid mixers to diamond necklaces – all supporting breast cancer research.  And the Komen Foundation became the Xerox, QTip or Kleenex of breast cancer.   Heck, the NFL had a pink out.  The Komen Foundation and the pink ribbon became the gold standard for every health advocacy group out there.  Until today.

Unless you’ve been shut off from the world the past few days, you know that the Komen Foundation will no longer be funding mammograms and other cancer detection services through Planned Parenthood.  I learned about it the same way you probably did – on Facebook.  And if social media is a good indication, this one isn’t going to just pass over.  The Komen Foundation has quickly become Public Enemy No. 1 for women everywhere, and put the debate over coverage of contraceptives on the back burner. Commentary ranges from statements about the power and influence of right leaning politics to suggestions that the foundation itself has lost its way in a sea of pink licensing and promotional deals. 

The Komen folks point to a new policy that prohibits them from funding, but a recent story highlights the departure of a top executive as a result of that policy, and several inside sources who paint a picture of duplicity – a public Komen advocating for women, while privately scheming to cut off Planned Parenthood in a nod to conservative politics who’ve made sport of villain-izing Planned Parenthood.  What inevitably follows is the question of Komen’s trustworthiness, and where the money goes.  How much of the millions they raise through walks, endorsement, licensing and product sales really goes to cancer research, and with what kind of results? 

The pundits will surely be lining up to talk about the importance of crisis communications.  And yes, good crisis communications will be key to the very existence of the Komen Foundation.  But this isn’t a communications problem – this is a policy problem.  In an apparent nod to conservative politics, the Susan G. Komen foundation manufactured a new policy in order to sever ties with Planned Parenthood. The Komen Foundation seemingly forgot, or miscalculated, the priorities of its passionate advocates and supporters. Good communications, even great communications, can’t fix bad policy or bad decisions.  The Susan G. Komen Foundation needs to make good decisions first, then communicate.

cwinters Crisis Communications NFL, Planned Parenthood, Susan G. Komen Foundation

Last weekend’s tragic Costa Concordia accident just off the Italian coast continues to dominate news coverage days later, thanks to the heroic stories of passengers rescuing themselves and each other and the almost daily revelations of the Captain’s incompetence, cowardice and excuses.  Carnival Cruise Lines, parent of Costa, has seen its stock price plummet.  The media and financial analysts are also speculating on costs to insurers and the cruise industry in general, particularly at the height of the booking season.  Cable news and investigative reporters everywhere are breathlessly reporting on such topics as the “hidden dangers of cruise ships” and “what you need to know before you book a cruise.”

From a communications perspective, the Costa Concordia grounding shows how an entire industry can be sent into crisis mode from one player’s accident.  And unlike the airlines, the cruise sector is focused purely on leisure activities so taking to the water is optional and not the necessity that air travel is for the majority of fliers.  Therefore, companies such as Royal Caribbean, Norwegian Cruise Lines and even Disney are scrambling to reassure the public of their safety procedures and distance themselves from the egregious missteps that took place in Italy.  One can also expect that a bevy of cruise sales are just around the corner.

For companies across industries, the lesson here is to be prepared to react and react quickly and appropriately when a crisis hits a competitor.  The media and public, especially in the digital age, can be fast and even reckless, painting an entire industry with one brush when there is an accident, scandal or any significant issue facing one player.   This is a great time to dust off that crisis communications plan, see if it is updated to take account of social media and game plan how you would react if a Costa Concordia happened in your industry.  There are times to be proactive as in the current crisis facing the cruise industry and there are times when you want to only be reactive, such as when a data breach impacts a competitor.   Notice how quiet online retailers have been after Zappos’ data breach, as no one want to raise their hand to tout their security bona fides and challenge a hacker.

rtauberman Crisis Communications Carnival Cruise Lines, Costa Concordia, Zappos

We are well used to retailers, airlines and a host of tech/industrial/manufacturing companies filing for Chapter 11 to try to fix a variety of financial messes and start anew.  But government entities seeking court protection under Chapter 9 are rare indeed.  On Wednesday, Harrisburg, PA, the State Capitol, took that seldom traveled road against a backdrop of a spectacularly failed incinerator project and political sniping at the local and state level.

For the citizens of and the companies that do business in and with Harrisburg, the way forward is unclear, particularly in light of conflicts at City Hall and the State Capitol about the legality of the move, much less potential solutions.  What is clear is that Harrisburg’s reputation (which already had some issues even with Central Pennsylvania partisans) as a place to live and work has taken a big hit that may take a long time to recover.   The public’s opinion of government on every level is hovering at all-time lows and unlike a retailer or airline, a marketing/PR campaign espousing “business as usual” through the process and an even better outlook on completion of the restructuring is a much more difficult proposition.

With politicians at the local and state level added to the usual mix of employees/retirees/unions, vendors and other constituencies, it should be an even more contentious and volatile process.  The political grandstanding and gamesmanship in the court of public opinion is already off to a spirited start, a sad harbinger of how things may go once the action picks up in the Bankruptcy Court.  Given the current economic climate, the Harrisburg case will also be closely watched by other cities and municipalities teetering on the brink.    

All that said, government entities, like companies, can come out of a bankruptcy filing stronger.  A good example is Orange County, CA which sought Chapter 9 protection over a decade ago after its investment portfolio tanked.    It will take leadership, comity, compromise and shared pain among government officials, employee groups, the business community and others constituencies dedicated to a common purpose and the greater good.   The start does not look good but as restructuring communication professionals, we are always optimists.

rtauberman Crisis Communications Harrisburg Bankrputcy, Orange County

Rupert Murdoch has always been a bit of a maverick. And he’s had his share of scandals. And you can’t spend decades in media and publishing, amassing an empire of his size and influence, without also experiencing moments where your hero status (launch of The Daily, anyone?) quickly becomes goat status.

But even I was surprised by the decision to cease publication of the UK’s leading tabloid in the wake of the phone hacking scandal. Since then, some have pointed out that this decision is largely a publicity stunt, because NewsCorp will pick up the readership, and transfer the advertising revenue, to other properties.

But it does beg the question about the table stakes when it comes to a crisis. Those of us in that business often counsel clients that their reputation, and even their business, are at stake when it comes to crises. And we’ve certainly seen companies that never really recovered from a large scale event – ValuJet/AirTran, Lehman Brothers and Exxon, to name a few. But it’s rare to see a company decide to just close its doors in the wake of a scandal.

Does Murdoch’s decision to just close up shop, displacing many innocent employees in the process, create a new world order where the table stakes are even higher in a crisis? Or will the world view this much like the ValuJet changing its name to AirTran scenario?

cwinters Crisis Communications AirTran, Exxon, Lehman Brothers, News of the World, Rupert Murdoch, ValuJet

Those words from the Hippocratic Oath are the principle governing emergency medical services and also a maxim for crisis communications. Unfortunately, they are too often forgotten in the rush to respond to a crisis situation and get out information. Rather than discuss the compromising pictures and botched cover-up of the latest misbehaving Member of Congress, I would like to focus on the less salacious topic of Spanish cucumbers.

The deadly E. Coli outbreak in Europe has seen German officials scrambling to find answers and reassure a scared public that has largely stopped eating fresh vegetables (something my daughter is seeking to do to show her solidarity with her Swedish relatives). Unfortunately, the German officials violated the first rule of crisis communications – never speculate on the cause of the issue and only dispense information that you are sure is correct.

First, they blamed the outbreak on Spanish cucumbers, which devastated the local farming sector and put another dagger in the already tumbling Spanish economy. Nice try but not true. The authorities in Berlin next pointed the finger at bean sprouts from an organic farm in Northern Germany, causing that facility to close down. With testing of the sprouts near complete, it now appears that this also is not the cause. Strike two.

Meanwhile, greengrocers and farmers across Europe are reeling and consumers are ready to join them in taking up pitchforks. The only winners so far are livestock and zoo animals who are feasting on discarded vegetables at the peak of the growing season.

Getting out in front of a crisis and setting the tone for communications is critical, particularly in the digital age. But the need for speed must be tempered by the cautionary words of Hippocrates to “first do no harm.” Sadly, the German government disregarded this and has made a bad situation worse, damaging their reputation at the same time.

rtauberman Crisis Communications Anthony Weiner, Congress, E. Coli, Europe, Farmers, Germany

Most people understand that if you do the wrong thing, you’ve earned your spot on the front page. A collapsed Ponzi scheme. An airplane somewhere other than a runway. A lawsuit.

But what happens when the actions of others put you in the middle of a story you don’t want to be in….when you are the scene of the proverbial crime, not its perpetrator? Like being the airline when the employee pops the chute and quits over the PA? (Disclosure: jetBlue is a client) Or being the hotel where sexual assault occurred and your employee was the victim? Or the restaurant where the mob boss was shot?

Crisis communications is about communicating, right? Maybe not. Sometimes the hardest thing to do is to just be quiet – to duck and let the story pass. Unless you are an enabler to the issue – something in your policies or actions enabled the situation, or could have prevented it – communicating just makes you a bigger part of the story.

Even though your instinct tells you to defend your Company’s honor, the more you communicate, the more you become a part of the story. This is especially true as the news cycle winds down, and the media starts looking for new angles for “day 2” stories.

For those reasons, Sofitel, the employer of the woman who was allegedly sexually assaulted by IMF Head Dominique Strauss-Kahn, and the site the location of the incident, has managed this crisis perfectly by cooperating fully with authorities and otherwise keeping its head low.

Sometimes the best strategy is to let it pass.

cwinters Crisis Communications Dominique Strauss-Kahn, IMF, Sofitel

The numbers are stunning – 77 million Sony PlayStation accounts hacked, 24 million Sony Online Entertainment accounts hacked, 12.3 million credit card holders information in possible jeopardy, including an estimated 5.6 million Americans.

Unfortunately some other metrics regarding the Sony data breach are also amazing – two days to contact law enforcement, five days to contact the FBI, seven days from the date of the breach for Sony’s U.S. subsidiary to issues a statement, nearly two weeks for the Company to offer more fulsome details of the attack and almost three weeks before Sony’s CEO issued a public apology. So much for learning lessons from Toyota’s long, fragmented and much maligned dance of disclosing details of the issues with its cars and seeking forgiveness.

Corporate bureaucracies, geography and culture aside, the rules of crisis communications are universal, particularly in the digital age of immediacy and no boundaries. Companies, whether U.S., Japanese or from Djibouti all need to get factual information out quickly (days are no longer a relevant measure of crisis response time), take responsibility, be transparent and exert control of the story in a crisis situation.
Sony like Toyota was a well respected company with a loyal customer base. PlayStation partisans are a more rabid even cultish crowd than Toyota drivers and they took to social media with a vengeance to air their outrage and savage Sony. Many are saying that they are done with Sony for good. Time will tell. Toyota has invested much time and resources in trying to win back trust of their customers and things are now getting back to normal for them. Sony will no doubt need to do the same.

The dichotomy between Sony and Toyota is the events that precipitated Toyota’s crisis were manufactured in-house while Sony was attacked by hackers (unless you are one of the conspiracy theorists who believe it was a disgruntled employee). If fact, Sony looks to be trying to make use of this victimhood in an effort to gain some sympathy from its customers as well all the elected officials and regulators investigating the situation. We will have to wait and see how this works out for them.

In the end, the Sony data breach shows once again that a company’s crisis response can be as, if not more damaging than the crisis itself. Toyota’s recall fiasco of 2010 cost it $5.1 billion or 16 percent in brand value according the latest Interbrand’s study of Best Global Brands.

The Sony saga is not over but it will be interesting to see how their brand value is impacted. Also worth watching is whether the next global company facing a crisis in the U.S. or elsewhere will heed the lessons of Toyota and now Sony.

rtauberman Crisis Communications PlayStation Network, Sony, Toyota

What a difference a month makes. Last month Warren Buffett was praising David Sokol, his erstwhile successor who made a hasty departure amid the scent of an insider trading scandal, as a great guy whose purchase of Lubrizol shares prior to the Oracle of Omaha buying the Company “were not in any way unlawful.” At this weekend’s Berkshire Hathaway annual meeting, normally a lovefest for 40,000 Buffett shareholders and devotees, the Oracle used words like “inexplicable”, “inexcusable” and “very damning evidence” to describe Sokol and what now looks like share purchases that will end with a perp walk.

Buffett is legendary for his investment acumen and vigilance regarding his and his firm’s reputation. After a month in the media spotlight regarding the Sokol/Lubrizol affair where questions swirled about what the Oracle knew and when he knew it, whether he was just getting too old and was off his game, or whether he was just a hypocrite when it came to Sokol, Buffett came clean and admitted that he “obviously made a big mistake.” Time will tell whether Buffett’s reputation took a hit. He has built up considerable good will over the years and the Sokol fiasco as well as the big hit to Berkshire Hathaway profits in the first quarter as a result of insurance losses will likely not do lasting damage to the man or his company’s reputation.

The Sokol/Lubrizol affair is just the latest example of the response to a crisis situation creating seemingly more problems for a company and its executives than the crisis itself (think Toyota, BP, Goldman Sachs and Johnson & Johnson). Crisis communications 101 teaches that you take control of the message quickly, be transparent, only release information on what you know and never speculate. From the start, Berkshire Hathaway dropped the ball, whether due to Buffett’s loyalty to a key member of his team or just not knowing the facts. The media jumped all over the issue and for a month reveled in discussing the seamy details and timeline of events, repeating Buffett’s reputation mantra and highlighting the ode to Sokol in the company’s press release.

Now, a few weeks late, Buffett has held forth on the issue and provided a mea culpa. Charlie Munger, Buffett’s right hand man summed it all up nicely at the annual meeting in typical Berkshire Hathaway understatement when he admitted that it “wasn’t the most clever press release in the world.” It also wasn’t the most clever way to respond to a crisis and that should be the lesson for the normally very clever Oracle and the rest of us.

rtauberman Crisis Communications Berkshire Hathaway, BP, Goldman Sachs, Johnson & Johnson, Toyota, Warren Buffett