What #OscarsSoWhite and Chipotle Can Teach Us About Crisis Communication

In today’s age of instant social media amplification, there has been no shortage of examples of crises and crisis communication in popular culture.

To walk us through what organizations should do to prepare for a crisis and how to best react, eCornell’s Chris Wofford was joined by Amy Newman, a senior lecturer of management communication at Cornell University.

While Newman says that “crisis is inevitable,” she believes that when handled properly a crisis can actually give a boost to an organization. What follows is an abridged version of her eCornell WebSeries presentation.

Wofford: There are a lot of things that could constitute a “crisis” within an organization. What are we talking about when we talk about crisis communication?

Newman: Let’s start by looking at an academic definition. Timothy Coombs, one of the leading researchers in crisis communication, defines a crisis as “the perception of an unpredictable event that threatens important expectancies of stakeholders and can seriously impact an organization’s performance and generate negative outcomes.”

It’s important to note that while a crisis is unpredictable, it’s not necessarily something that you can’t anticipate. Some organizations should know what crisis is coming and even if they don’t, they should be prepared for some crisis because it will happen at some point. It’s just a matter of what it is and when it strikes.

A crisis does threaten the expectancies of stakeholders. There might be health or safety issues, environmental consequences or economic consequences, and all of these will have an impact on the organization. So by definition, a crisis affects the organization’s reputation or bottom line or something else.

Wofford: What’s a good example you could share? Are there any recent situations you can point to as a case of crisis communication?

Newman: There’s one that I’m sure you’re aware of and that the viewers are aware of. The Academy of Motion Pictures recently identified their slate of nominees for this year’s Oscar awards and they were all white for the major categories. There was a lot of backlash about this, with Spike Lee and some major actors threatening to boycott. There’s a hashtag trending on Twitter called #OscarsSoWhite. So this is something that has evolved to the level of a crisis.

Wofford: The consequences in this case are pretty obvious, right?

Newman: If there are people who are respected in the industry who don’t attend the awards because of this, the ceremony is going to suffer and advertising revenue might go down. I would also say also the general reputation of the organization is being harmed. The Los Angeles Times has been doing the most reporting about the situation and they took a look at the demographics of the academy itself and guess what the average age of the people voting for the Oscars is?

Wofford: I’d say it’s up there. 50-plus, 60, 70.

Newman: It’s about 62. So, you know, it’s people who have won awards, people who have been in the industry for a long time. They have a lifetime membership. You can see why there might be a lack of diversity.

In this case, I wouldn’t say that the crisis was entirely unanticipated. They should have known better. Last year, there were also all white nominees and criticism of the Academy. At the time, the Academy president,Cheryl Boone Isaacs, who happens to be an African American, was adamant that the Academy didn’t have a problem recognizing diversity. But now it’s escalated to the point that they really do need to do something about it.

We’ll talk later about their response, but first I’d like to talk about three phases of crisis management: preparing for a crisis before it happens, managing through the actual crisis, and then learning from a crisis.

Wofford: It’s the leader’s job to prepare an organization for decisions using these three steps, right?

Newman: It certainly is. The preparation is very important. We usually think about crisis management happening at the most senior level of an organization and certainly if it’s a large organization, there’s a corporate communication department that handles much of this.
But it becomes everyone’s responsibility during a crisis to represent the organization well and to try to turn things around.

So in preparing for a crisis at first, well, of course the best way is to prevent a crisis from happening at all. You can’t do that in every situation but you can in some. I’ll present Volkswagen as the case here. They installed diesel deception software in their cars so, in effect, created their own crisis. It was bound to come out at some point.

Wofford: Do you think Volkswagen was at all prepared for this? They got caught red-handed.

Newman: It really didn’t seem they were ready for it. What I understand about Volkswagen is that they have a very tightly controlled centralized management. That’s good in some situations but in a situation like crisis communication, it made them very slow to respond. I think it’s because they kept information so tightly closed—they really were not prepared for what happened at all.

One thing an organization should do is to document what would happen in case of a crisis. This means identifying contacts and putting together a team of crisis communication people. Usually that will be some HR people, maybe your local department, communications people, of course, some emergency management people, safety—All of those functions should be represented.

Included in that kind of plan is an approach for the media. What should we say if we get a phone call? What will the communication challenges be? Which channels should we use? How do we notify different audiences?

Part of the preparation process is being honest about the vulnerabilities in an organization, and this really depends on the industry. If I own a restaurant, I am likely to have a problem with food poisoning at some point or some other food safety issue that has to be handled. If I work for a hospital, we will probably have a malpractice situation, so we might as well think about how we’ll address that when it happens.

The other way to think about this is situational. If we’re doing layoffs, well, we might have a situation of workplace violence. If we’re in the process of labor negotiations, we might face a strike so we should prepare our messages ahead of time.

When a crisis hits an organization, emotions are running high and you have to act quickly. You don’t want to be trying to craft messages and figuring out the best way to respond. That should be done ahead of time.

Another thing we can do is to try to catch a situation before it becomes a full-blown crisis. An example I can give is McDonald’s.

Wofford: Okay, I see your slide shows a poster saying ‘You’re not alone. Millions of people love the Big Mac”. But yikes, the woman looks very depressed or even suffering from mental illness. I can’t imagine this campaign worked out very well.

Newman: Well, a lot of people suffer from mental illness, depression in particular, and this was not appreciated. So someone took an image of the ad and posted it to social media and there we go: a crisis is born.

But I have to compliment McDonald’s for handling it quickly. They immediately put an apology out. They also blamed their ad agency, which could be a dangerous strategy. But the ad agency in Boston took responsibility and confirmed what McDonald’s had said, which is that they had not approved the ads. So the agency apologized as well.

The ads were taken down and it quickly resolved, which is the best way to handle a crisis.

Wofford: McDonald’s probably offended some people but by responding quickly, there wasn’t a major effect on the company’s bottom line.

Newman: Exactly, McDonald’s handled it correctly.

But sometimes, despite our best efforts, there is still a crisis. I’m going to review three principles and I’ll show some examples of each. The first is to communicate quickly. That is essential, especially within the social media environment. The second is communicating consistently. And the third principle we’ll talk about is communicating openly.

Let’s start with the first. A study found that 53 percent of Twitter users who expect a response from a company on Twitter expect that response within just one hour. The thing is, within an hour all sort of things can happen on Twitter. One tweet could go to millions of people, so if companies aren’t in that conversation they’re really going to miss out.

Let’s give an example. People may know of the movie ‘Blackfish’, which came out in 2013. It’s about SeaWorld and how they treat their animals. It showed how SeaWorld was treating their orcas, putting them in restricted spaces. According to the film, there were some trainer injuries and a couple of trainer deaths because of how the orcas were being treated. It is a pretty damning film.

SeaWorld had no response to the movie at all and the conversation just kept elevating and elevating and social media celebrities were all over it. Some acts canceled planned events at SeaWorld. PETA, of course, had its own campaign. People were making this analogy of living in a bathtub for 40 years, referencing the confinement that the orcas had suffered.

SeaWorld showed exactly what not to do in a crisis situation. They refused to do any interviews. Months later, they finally did start to use social media and their website to share some videos meant to portray that they’re actually an organization that helps animals. But it was too late, and now what we’re seeing is that SeaWorld has really suffered in terms of ticket sales and lost partnerships. This was just a classic example of a tone-deaf organization that wouldn’t admit to wrongdoing.

Wofford: You mentioned you would get into how the Academy responded to the #OscarsSoWhite crisis.

Newman: Well, after that hashtag started trending, Cheryl Boone Isaacs did respond pretty quickly. The Academy tweeted out a statement from her, which you can see on my slide.

In her first statement, she says “I’d like to acknowledge the wonderful work of this year’s nominees.” And I think it’s really important to remember that when a leader is working on a crisis situation, there are many, many audiences involved, and many people to try to appease. One thing she can’t do is take anything away from the current nominees, so she’s doing the right thing here in acknowledging them.

She goes on to use really strong words: “I am both heartbroken and frustrated about the lack of inclusion. This is a difficult but important conversation and it’s time for big changes.” This sounds sincere.

Wofford: And she’s owning it by using “I”, right?

Newman: Yes. She’s doing the right thing. She’s the president of the organization but she’s also saying this as an African American. I’m sure she probably has her own feelings about this as well.

She goes on to say: “In the coming days and weeks we will conduct a review of our membership recruitment in order to bring about much-needed diversity.” So she’s promising action and, of course, you say that you had better do it, right?

She continues by saying that the Academy has done quite a bit to encourage diversity in recent years but she acknowledges it hasn’t been enough. So I think that’s good too.

But then I think she really falls a bit short in the end when she says “This isn’t unprecedented for the Academy. In the ’60’s and ’70s, it was about recruiting young members.” Now, as my students would remind me, that was a long time ago.

Wofford: Right, and probably a lot of her detractors haven’t been around that long so I’m not I’m not sure that line did her any favors.

Newman: Exactly, it makes you think of old white guys. But she ends on a positive note: “I recognize the very real concerns of our community.” That’s a good line.

So the Academy’s response, issued just four days after the crisis, is not a perfect response, but it is a good example of a quick response.

Now let’s look at another principle for communicating, which is communicating consistently. You’ve got three tools that are going to help you communicate consistently within the organization. One is the crisis communication plan that we looked at before. The second tool I would suggest is social media guidelines. The third tool I want to recommend is to have a communication plan.

Organizations need to identify all of their audiences, internal and external, and think about how those audiences might feel or respond to a crisis situation. That helps us really empathize and then identify what we are trying to accomplish with our communication. What do we want them to feel after they read our message or watch our video? What do we want them to think differently about the company?

It’s always good to use a variety of communication channels because we know that people have different learning styles and different ways of receiving information. So you have to use multiple forms: social media, emails, press releases, statements on websites and, of course, video can be very powerful in a crisis situation.

Too often companies forget about internal employees so I would recommend prioritizing those before anything goes to the press to make sure that internal employees are aware of what’s happening and any response that the company is planning to make.

Wofford: Your third principle is communicating openly, right? What does that mean?

Newman: Being available to the media, being honest about the communication and, ideally, being transparent. Now, there can be a lot of questions about how transparent an organization really should be. There’s always this healthy tension. Lawyers tend to be more conservative and don’t want the companies to disclose much. They might prefer an organization to say “No comment.” But corporate communicators know that kind of stance is not going to help the company in the long run. People really want to know what’s going on.

My view is that information will come out anyway, so you might as well control the message as the organization.

Another area of great debate within some companies is whether organizations should apologize. Lawyers sometimes argue that apologizing demonstrates guilt. But we don’t have to apologize in a way that says we’re responsible. We can apologize in a way that shows sympathy and regret. There’s a ton of research that says showing sympathy will actually mitigate the reputational damage for an organization in the long run and could actually reduce financial loss.

Wofford: Once you’ve made it through a crisis, what should you have learned?

Newman: What most people want to do is just get back to work because it’s incredibly emotionally draining and time consuming, but one of the most important things a crisis leader can do is to reflect on what happened. How did we do in terms of the media coverage and community relations? How did the crisis management team itself do?

Taking stock in that way is really important to build leaderships skills and to prepare for another crisis if it does happen again.

I want to end on a positive note here and that’s to say that there’s definitely a life after crisis. I’ll give an example with the Tylenol case. In 1982, cyanide-laced Extra Strength Tylenol appeared on the shelves. At first, the company said it didn’t come from their plant; they denied responsibility and the predictions were that the company was pretty much done.

But then they acted very proactively, pulled all of the product from the shelves, and they actually came up with those tamper-proof bottles that we know today. They took real positive action and became an industry leader.

For a more current example, we can look at Chipotle’s response to its E. coli breakout. They are being very transparent about changes. Just this past week, the company had a meeting at all its locations. They closed down for four hours and they live-Tweeted the meeting. Chipotle founder Steve Ells says that he wants to become a leader in the industry in terms of food safety. We’ll see whether he achieves that goal, but most analysts say they have no doubt that the company will recover.

People have short memories and as soon as another crisis comes along, we will forget about this one.

Wofford: Amy has a Twitter account, @bizcominthenews, that is very current and keeps up with all of these sorts of issues—we invite you to check it out.
Amy, thank you so much for joining us today.

Newman: Thanks for having me. It’s been fun.

 

Want to hear more? This interview is based on Amy Newman’s live eCornell WebSeries event, Crisis Communication: Expect the Best, Prepare for the Worst. Subscribe now to gain access to a recording of this event and other Women in Leadership topics. 

Christopher Wofford is Digital Media Producer and host of WebSeries at eCornell.
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