For about a week in early March the media obsessed on the Walt
Disney Co. It seemed like all other news -- the tensions in Iraq,
the war on terrorism, the jobless economic "recovery" -- took a
back seat to all the doings at Disney.
The story certainly had enough drama. In addition to Comcast's
all-stock takeover bid for the entertainment giant -- which remains
despite Disney's rejection -- Roy Disney, the nephew of company
founder Walt Disney, had started his public crusade to oust Eisner.
Disney was like "Zelig," appearing on both the network and cable
news shows to get his message out as well as penning Op-Ed pieces,
with his partner Stanley Gold, in The Wall Street Journal.
As if feeding off [Roy] Disney's tirades, many in the press
started to slam Disney CEO Michael Eisner. At first, Eisner laid
low. But on the day of Disney's annual shareholders meeting in
Philadelphia March 3, he appeared on ABC/Disney-owned "Nightline"
-- and was subsequently grilled by Ted Koppel.
Yet amid the firestorm Disney, the company, rolled right along.
According to Fortune, the company has promised to deliver "more
than 30% growth in earnings this year and double-digit compound
annual growth in earnings through fiscal 2007. Wall Street has been
listening; Disney's stock is up 58% in the past 12 months." (In the
same issue of Fortune, Disney was voted No.1 of Most Admired
companies in the entertainment space.) During the height of the
(mostly negative) media coverage, Disney's stock didn't take a hit,
hovering in the $25 range. Around the same time, the company topped
the 2003 Media Reputation Index (compiled by Delahaye Medialink)
and moved to No. 4 (from No. 15) on Harris Interactive's 2003
ranking of corporate social responsibility.
Although the Disney story is far from over, the initial media
coverage illustrates how crucial it is for senior communication
executives, with their CEOs in tow, to get out in front of stories
(about their companies) that can get out of control.
It happens whenever the media pack swarms the same story: a
disconnect, to varying degrees, between perception and reality.
(The perception here being that Eisner was already packing his bags
for the beach and Roy Disney was handing out noisemakers after
slaying his nemesis.)
"[Roy] Disney has been able to marshal his resources and has
judiciously used his allies to validate his claims but I haven't
seen the same from Disney Co.," says Bill Keegan, senior VP for
crisis and issues management at Edelman. "That may be the strategy,
to lowball the situation, but [the company] hasn't managed the
issue properly and has let the opposition fill the vacuum...A
defensive strategy is not a winning one."
Companies must be preemptive when going up against the media.
"Stories take on a life of their own only because the company
wasn't prepared," says Sallie Gaines, senior VP/media for Hill
& Knowlton, known for its work in crisis communications.
"Companies need an overarching message that the CEO and the
chairman need to buy into and they need to get these messages out
early" when a crisis strikes.
Gaines, who was a business reporter for the Chicago Tribune for
nearly 20 years, says companies have to develop early warning
systems. "You need people who are constantly monitoring the Web
sites that are important to your company or your company's
customers," she says. "You need, 'Mmmmmmm, people in Idaho seem to
be upset about our Mexican imports that are being sent to the
Northwest.' But I'm still stunned at the number of large
organizations that don't have monitoring systems."
Gaines recalls the practice at Kemper Insurance, now part of
Zurich Financial Services, in which a media synopsis was created
every morning for the CEO to see where some trouble spots might
emerge that day. This is not unlike the Natural Security Advisor
briefing the president before the start of business every day.
There are other ways to ensure the company isn't blindsided by
the press, namely being hyper-responsive to reporters during a
crisis. "I know some companies that can take as many as four days
to call you back to tell you the CEO isn't available," Gaines says.
"These are the same companies that are quick with excuses. I
understand that PR execs are up against a brick wall, but at some
point a decision has to be made." When companies do settle on
strategy, "there's nothing like saying the allegations are wrong,"
Gaines adds. "Give them facts instead of outrage."
One of the most important things to do when facing an acute
crisis is to isolate the decision-makers and spokespeople who will
handle all the messaging; the smaller number of people in these
roles the better, since too many cooks in the kitchen can often
spoil the broth.
Short of a law degree, you also have to learn to work
harmoniously with legal counsel. In the wake of the Northridge, CA,
Earthquake in 1994, for example, Allstate received what ultimately
turned out to be fraudulent policy claims. But at the outset, the
insurer took the charges very seriously. The FBI started to
investigate the alligations against Allstate. "The situation was
escalating and things were getting out of control," says Peter
Debreceny, director of corporate relations at Allstate. "We were
open and accessible [through the process] and jointly agreed (with
legal) that since law enforcement officials were investigating the
charges, general counsel would be the best spokesman."
In other cases, however, the CEO could be the spokesman, even
though his or her comments might be misconstrued. But that's no
excuse for getting out there - and quickly. "You shouldn't let risk
paralyze you," Debreceny says.
Contacts: Peter Debreceny, 847.402.3111, [email protected]; Sallie
Gaines, 312.255.3094, [email protected];
Bill Keegan, 312.240.2624, [email protected]
Riding the Media Monster
When a negative issue just won't go away, the public relations
team often is blamed because the media "has it all wrong." Several
steps could have helped prevent or ease such a crisis.
First, building strong relationships with key media pays
dividends in a crisis. Reporters are more inclined to give the
benefit of the doubt to executives who've built up a reservoir of
trust and good will. Second, smart organizations constantly monitor
the media--including relevant Internet chat rooms, Web sites,
consumer newsletters, etc. - to identify emerging issues.
Even organizations that do these things can be blindsided by an
accusation or issue, so the third step is to respond immediately
and strongly so you are part of the first cycle of coverage.
If none of these things happened, somebody else has framed the
story. Your first job as the internal public relations professional
is to make clear that top executives understand they need to be
personally committed and involved. The more serious and potentially
damaging the issue, the more senior the public spokesperson needs
to be.
Steps that can help ease the pain as the issue plays out
include:
- Tell what you know, when you know it; it may be weeks or months
before you know all the facts, and by then nobody is listening - Tell only what you know to be true, not speculation, rumor,
indignation or personal opinion - Address any question, even if just to explain why you can't
answer, and always bridge to what you can and want to say - Offer respected third parties who can verify and explain facts
you offer - Reach out quickly and, if possible personally, to your most
important audiences. For example, a business-to-business company
needs to focus first on key customers, not consumers - Don't engage in name-calling; if your facts are compelling, the
media will figure out that accusers may have an unfair agenda - Keep employees informed
- Do not let fear of legal action keep you from doing or saying
the right thing; show and express care, concern and empathy for
anybody who has been or may be harmed
Source: Sallie Gaines/Hill & Knowlton