Date post: | 02-Dec-2014 |
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Reputation & RumoursDefending the Corporate Reputation
July 29, 2014
Reputation and RumorsThe way stakeholders perceive the organization based on multiple inputs including actions, product quality and communications
Unverified information spread initially through informal channels about the organization. Can be positive or negative; true or false, or a mix of true and false
How the organization responds to the rumor through words and/or actions. No response counts as a response.
The impact of the response on the rumor and on the organization’s reputation
Reputation
Result
Response
Rumor
Current Reality - Rumors Rumors are a fact of life – people seem to
enjoy gossiping and spreading rumors Rumors may be false, true or partly true –
it is up to the organization to clarify the facts of the matter
Some rumors are the result of a malicious hoax or the attempt to advance a cause
Modern technology makes spreading rumors faster and easier than ever before Facebook is an excellent tool for spreading
rumors
Current Reality - Rumors
Case Study – Cambodian Exodus
Case Study – Cambodian Exodus Approximately 200,000 migrant workers from
Cambodia left Thailand over the course of a week in June 2014
The primary factor leading to this unprecedented movement was a rumor that Thai authorities would soon crack down on illegal workers
At the time of their departure there had been no major crackdown and no formal announcement of one
Why was this rumor so powerful:- Cambodian workers were unregistered
- The NCPO had stated policy toward controlling illegal workers
- The Thai government is controlled by the military
Case Study – Cambodian Exodus The effects of this rumor included short-term
damage to the Thai economy Damage to Thailand’s reputation – especially
considering its recent ILO vote and TIPs downgrade
Damage to Thailand’s relations with Cambodia
Defending Your Reputation
Reputational risk areas
Monitoring for new rumors
Response to damaging
rumorsThe first stage in reputational defense is to determine where you are at risk
The second stage is to stay alert to new rumors
The third stage is to quickly and decisively respond to damaging rumors
Risk Assessment – Know the Environment To help prepare to respond to rumors it is
necessary to first identify areas of risk Internal – operations, products, services,
employees External – NGOs, regulators, community groups
Once risks have been identified they should be prioritized according to likelihood and impact Likelihood – the odds that they will happen in the
near to mid-term futures Impact – the financial, operational, reputational
ramifications of the rumor – how much will it cost
Risk Assessment – Know the Environment
Monitor the situation and key players
Prepare reactive materials and
conduct training
Monitor & seek to proactively
engage relevant stakeholders
Actively engage stakeholders and
address root causes
LL
H
HIMPACT
LIK
ELIH
OO
D
Risk Assessment – Know the Environment Analyzing stakeholders
Internal / External Friend / Foe Power Influence Access to resources
Your current position – reputational audit Based on insights re. key issues and key
stakeholders obtain benchmark information on the state of your reputation and the reputation of your competitors
Media Relations
Media Relations Media relations is not hard but it is a time-
consuming and long-term process Building good relations with media requires a
commitment to transparency Need to be willing to work with media in both
good and bad times Balance between key media and ROM Understand growing importance of online/new
media
Media Relations During a rumor driven reputational crisis:
A response of some kind is required Speed is essential Know the facts (be able to separate facts from
fiction) Be consistent in your message Communicate broadly – across platforms Have a crisis communications command
structure in place
Media Relations
Rumor
Proactive
Proactive
Reactive
False True
Kill it with facts
Explain Context
Don’t Know
Seek Resolution
Determine T/F
Go Proactiv
e
Go Proactiv
e
Media Monitoring
CVCVCV
CV CV
CV
CVCV
CV
CV
CV
Media Monitoring Media monitoring can provide early warning as
well as current status of a reputational issue/crisis
Types of Media Monitoring General – everyday process focused on your news
and your competitors (daily) Issue specific – regular review of media to track issue
development and key players (weekly/monthly) Social media – can be related to first two but often
requires special skills and tools (daily) Crisis monitoring – intensive issue-specific monitoring
executed as close as possible to real-time
Media Monitoring The key to effective monitoring is determining
the important search areas and channels Narrowing the subject matter and the range of
channels makes the monitoring process more efficient
A primary point of failure for many organizations is effectively using the output of media monitoring – especially regarding issues There needs to be an individual or team
responsible for analyzing issues coverage and alerting management to important trends or developments
Operations: It’s what you do
Operations: It’s what you do At an operational level an organization can do
several things to mitigate the impact of a rumor: Maintain clear and open communications Leverage a history of transparency and good
governance Ensure fast decision making followed by appropriate
actions Use employees as ambassadors to reach out to key
stakeholders Make sure that regular operations do not suffer
Have patience Most Internet-based rumors do not last long and if your
response is appropriate and honest the impact is likely to be limited
Case Study – KFC In early June 2014 a rumor started to spread that
a KFC in Mississippi, USA asked a 3-year old girl who was recovering from a pit bull attack and her grandmother to leave because ‘her injuries were disturbing the other customers’
The story was picked-up by local TV news and from their it went national
Case Study – KFC KFC’s initial response was to say that this action
was against its policy and that it was investigating the situation
The company launched two investigations (one internal the other with an independent agency)
KFC also offered to contribute to the girl’s medical expenses
In the face of significant social and traditional media scrutiny KFC never admitted to wrongdoing in this case
Case Study – KFC The result of the investigations were that the
claims against KFC were a hoax and there was no evidence the girl and her grandmother had been to the KFC in question
The company simply announced the results of its investigation without taking action against its accusers
The family initially maintained that it did not lie and the incident happened, but offered no further evidence
Shortly after KFC’s statement the little girl’s Facebook page and donation website were deactivated
Case Study – KFC Why would this rumor spread? Why would the hoax be perpetrated in the
first place? Was KFC’s response appropriate?
Wrap-up Rumors have always been a part of the
business environment and a reputational threat - this will not change
Today technology makes it possible for rumors to spread very quickly and very far
Media still plays a role in helping to make a rumor ‘viral’
Understanding your risks and monitoring the environment are keys to defending yourself
Your response to a rumor should be based on facts and proportionate to the potential damage