Willem S Eksteen, Chief Executive of Stone, as featured in the October/November 2020 edition of BusinessBrief, available online here.

Sometimes things do go wrong – this is a reality of business and life. How one responds to an issue or how one resolves an embarrassment, determines how your business and personal reputation is scarred or strengthened in a time of crisis.

We have recently seen some very public hair-raising examples of how a blunder should not be handled and others where misfortune was turned into an opportunity by managing a potentially damaging situation correctly and swiftly.

A good business reputation gives you a competitive advantage. According to Forbes Magazine, your actions and what others say about you craft your reputation. This approach is the most powerful leverage you have in business and life. A headline-making crisis can alter a company’s public perception and business future forever. Most people’s reputations precede them. If one’s reputation is positive, they don’t have to sell themselves or brag, because others are doing it for them. If people understand what one stands for, they might view crises with more graceful eyes against the backdrop of a positive reputation, for a short window in time and provided that the situation is well handled.

Many sayings like ‘do not waste a good crisis’, have become commonplace because they are apt descriptions of how a problem can be turned to benefit the person or company in the eye of the reputation storm. However, unfortunately, another commonly known platitude that is equally true is if you fail to plan, you plan to fail.

There are many examples that we know too well where bad planning resulted in reputation damage and severe business impact. Recently there was the issue where airlines removed passengers from their seats to accommodate others. Another was the listeriosis issue that impacted the entire processed meat industry. While more recently, we saw the business impact on a fast-food chicken chain when they failed to plan and manage the fallout of a bad situation.

Approach

In line with our bespoke methodology, Stone Pebble Ring Thinking©, all planning should always be driven by one’s business rationale in an integrated reputation engagement approach – especially at a time of adversity. The reason for or higher purpose of the business should remain at the centre of managing a reputation crisis.

At a time of crisis, acting in line with your expressed values will not only be testing your mettle, but it will guide how you interact with those around you with sincerity, integrity and placing the interest first of those most affected by the issue at hand. It remains businesses critical to act sincerely, with empathy and driven by your lived values (and hopefully these are not values merely articulated in a faded document in a cheap frame gathering dust on a stairwell on route to the office canteen or boardroom)

Execution

Focus and a keen eye on timing ensure that communication objectives flow seamlessly into engagement and service delivery. All activities must be executed with the best strategic reputation impact in mind and with minimal time wastage and noise for a better return on investment.

The steps we usually recommend at a time of reputation crisis include the following:

  • The first step is long before any situation – always plan for the eventuality by having protocols in place that are triggered the moment adversity hits, or crises strike
  • Rather be regretful when you have made a mistake – do not become defensive and try and justify a blunder, saying ‘sorry’ when it is required as it makes you more human
  • Do not lose your cool or become aggravated – that does not help anything
  • Act swiftly and with integrity – own up quickly if you messed up and manage it well from there
  • If you hear that your business reputation has suffered, work immediately to repair it
  • Manage stakeholders with the help of expert counsel – reputation crisis is a very specialised skill
  • Align your message and business strategy and keep your business objectives at the centre
  • Do not act out of character – exceed expectations in line with your business values and personality
  • Be authentic and consistent while allowing your stakeholders to make sense of the situation
  • Clear up misunderstandings that might have led to worsening the reputation crisis
  • Practice positive behaviour and illustrate the real value that your business brings
  • Show interest in others beyond your interests, even that of your advisory’s well-being
  • Take your people with you – communicate well internally and do not let employees learn the fact from an unfolding media circus
  • Learn sustainable lessons from the crisis and make these lessons part of improved business practice in the future
  • Plan your future business reputation beyond the current prevailing situation or issue – it is not a short -term thing – focus on the sustainability of your reputation

Cohesion in the reputation management should drive all communication endeavours while being supported by a focus on the business value added to one’s stakeholders.

In addition to working relentlessly towards building a positive reputation, one must reactively guard against crises and reputation risks by having the correct tools as part of the issues plan:

  • Lead from the front – develop a spokespersons matrix with well-trained visible senior spokespersons, mapped with key eventuality and business-relative expertise to champion your narrative well at a time of crisis
  • Develop a reputation management programme
  • Develop a crisis communication manual and enforce as policy
  • Engage target audiences proactively at relevant and multiple touchpoints
  • Use digital tools effectively to build the reputation and mitigate the fallout from the crisis
A permanent strategy

Crisis impact must not be seen as not merely short-term. Recently Lunice Johnson commented amidst a very public and political retail crisis that effective reputation management needs to be recognised as a long-term game that should be an executive priority. She rightfully noted that perhaps executives would pay more attention to it if they incorporated reputation with real sincerity into their broader risk business strategy and organisational performance management criteria.

Quoting the Harvard Business Review of February 2017, she stated that a sober approach to issues and reputation was required, away from believing one’s PR. The authors argued that executives’ responsibility to protect the company’s reputation is as important as ensuring operational performance is optimal, since both drive shareholder value. Senior executives tend to be optimists and cheerleaders. Their natural inclination is to believe the praise heaped on their companies and to discount the criticism. ‘But looking at the world and one’s organisation through rose-tinted glasses is an abdication of responsibility’, stated the HBR.

Our brave new world

We live in a media-flooded world with information always at our fingertips and on stakeholders’ screens. In this brave new world of immediate news where negative news stories, damaging posts, scathing customer reviews, embarrassing video clips or employee blunders, can be shared and commented on hundreds or even thousands of times before a company is even aware of it. By the time a reputation-damaging story has made the rounds online, it’s often too late to effectively respond in a way that will protect the company’s reputation only with sound old-school rules.

Managing a crisis in the connected world demands fast and decisive action, more than ever before:

  • Use the digital conversation to one’s advantage and be responsive and assertive from the start
  • Listen and be in the conversation – do not leave it to the geeks or social teams only
  • Manage the expectations and drive the agenda by responding fast and decisively
  • Ensure that you floor the platforms of adversity with positive stories and points of view from your company – not only from own sources but gain external endorsement for your point of view
  • Do not assume anything – investigate and follow the conversation while building a responsible narrative around the situation at hand
  • As far as possible, take the conversation offline for constructive direct engagement but without becoming circumspect – remain transparent as possible in your management of the issue at hand
  • Publicly connect with the affected people, solve their concern quickly and sincerely
  • Use social sentiment in social media to turn adverse views into supporting ones, illustrate people-centricity with a willingness to listen and respond directly (albeit in a public forum)
  • Leverage technology to manage your online and offline reputation in tandem – integrate across channels so that a single business reputation is built and at every turn, your narrative remains the same
  • Manage all your digital platforms well
  • Do your best but do not expect that you will please everybody every time

Regardless of channel or platform, hold your reputation dear. Plan properly, act rapidly and execute meticulously. Manage risk by safeguarding your business reputation as a critical strategic business asset.

Turning adversity into opportunity – positive case studies

Since 2008, our clients have regularly called upon us for advice and counsel on how to weather storms that have the potential for reputation devastation, and to engage with hostile audiences during times of adversity.

Mining accident

We had formulated and facilitated all strategic internal and external communication for a coal mining client. The company was formed as a B-BBEE company with strong values and led by integrity-driven leaders, avoiding the unethical practices of fronting or tokenism. Unfortunately, a severe accident occurred where a miner was buried under coal when a vehicle that he operated overturned near a conveyer belt, carrying coal to one of South Africa’s critical power stations. In the mining industry and society at large, mining accidents and especially fatalities are rightfully a massive concern.

At the time of the accident, very few facts were known. From the outset, we onboard to counsel the CEO and to guide the organisation through this traumatic event. Without sensitivity to the situation, the family and community where the victim hailed from, a very positive business reputation could have been damaged beyond repair. Fortunately, the company had strict protocols in place, and it was not just left to the compliance admin processes only.

At first sight, it was unclear if the accident had claimed only one victim and indeed what the cause was. In line with the issues plan, we had to act very swiftly and gave counsel to the CEO as the spokesperson from step one. The CEO was rushed to site where he remained during the search and recovery operation of the victim. He participated actively and visibly in the interest of those touched by the tragedy. As the search went on, as could be expected, family and community concerns heightened, and they had to be engaged to keep them in the picture as the case unfolded. They had to be reassured of the company’s commitment to a safe working environment for its workers. There was also mounting media interest due to the essential nature of the operations which supplied the power station, and the topical issue of mining safety when the accident was confirmed as fatal.

The sincere and sensitive approach also reaped positive results, and the family appreciated the significant support from the company, which garnered positive sentiment and community support for our client. Following the events, the incident that had had the potential to devastate the company’s reputation, had, strengthened the relationship with the community and gained significant alignment, which later stood them in excellent stead. Internally, the incident served to foster a renewed focus on safety across their mining operations.

Tourism fraud

Tourism has been earmarked as a growth industry in South Africa. However, it is also a volatile people-driven industry that will always remain extremely susceptible to several environmental elements that cannot easily be controlled. During one festive season, a client of ours faced huge embarrassment and reputation risk, which impacted the company and South Africa as a whole. A franchisee defrauded travellers by booking outbound flights but cancelling the return flights without the passengers (or company’s) knowledge. The company was then defrauded of the proceeds. Passengers were then left stranded on Christmas Eve en-route back from their international holiday destination.

The issues at hand were the very public fraud at one subsidiary, as well as substantial losses at another business unit. The client also had to realign its business to counteract the impact of these issues, whilst rekindling a positive reputation as a sound and credible business. Furthermore, the group was aiming to strengthen its position and transform itself into one of the most dynamic companies in the tourism sector. Rapid action was required. In response to the immediate crisis, reactive media engagement was actioned. Travellers and families waiting for their return were reassured, and new return tickets were issued at our client’s expense. Further governance steps were taken and communicated to manage the fallout.

Our team commenced the strategy development process to repair the corporate reputation, with a fully integrated brand reputation management strategy. The strategy implementation included rekindling activities aimed at correcting perceptions and reflecting its real business intent among its stakeholders.

Due to the rapid and decisive action taken, the media fallout was minimal and reactive engagement with enquiring media was in general very positive. A facilitated process of engagement with all the key stakeholders affirmed the business and brand reputation, whilst aligning internal audiences with the group’s business vision.

Reputation crisis - BusinessBrief Magazine

As featured in the October/November 2020 edition of BusinessBrief, available online here.