Crisis Management: Crisis Lessons the Hard Way – Firestone: Crisis response
What were the likely reactions to the Firestone tire recall calamity several years ago?
If your vehicle had such tires, you worried that loved ones were safe.
If you managed a company, you said, “God, don’t let this happen to me.”
If you were an employee, you wondered whether your executives could protect your job during a crisis.
The Firestone case came close to matching the Exxon Valdese for crisis mismanagement, and I saw at least 4 lessons to be learnd from it.
Your first action is the most important.
“When did you learn about it and what did you do about it” is paramount. Failure to recognize and rapidly fix a problem is like giving your company cancer. Monumental public relations campaigns may be in progress, but you are so sick inside that you may not survive.
I worked on two chronic crises where initial actions by the companies were badly bungled before I got involved. One case lasted two years, the other five months. We did a good job of attempting to undo the damage – we even got kudos for it – but the turnarounds failed. The holes were too deep. Promise yourself that you will take positive action quickly. Again, the finest PR cannot offset a disastrous first mistake allowed to linger.
Work with your lawyers toward customer protection and not just self-protection
The Wall Street Journal reported that Bridgestone/Firestone apparently ignored public relations counsel to boldly fix problems early and took a lawyer-driven cautionary approach instead. This has proved disastrous.
You may remember that Swissair’s CEO, following the airline’s Nova Scotia crash, told company attorneys to come back later because he did not want them interfering with the airline doing and saying the right thing. He said that the lawyers “are programmed to be enemies of communications” and would tell him not to do or say anything that would cost the company money.
Since most crises end up in court anyway despite your best efforts (one crisis manager estimates 90%), why not strike a blow for doing the right thing early? Wouldn’t that give you something more constructive to say to a jury?
Customer protection would also give you something helpful to say to the news media. (Incidentally, the media – a Chicago newspaper and a Houston TV station following on the heels of an insurance researcher – started the Firestone firestorm.)
At the time, a good example of prompt public action was the Freightliner brake recall for trucks, buses, and tractors. The manufacturer initiated this after some 40 incidents, none serious. While the affected companies would surely prefer to avoid the repair bills and national news coverage, wasn’t that preferable to the horror show that would follow the deaths of innocents because of inaction?
“Pay me now or pay me a whole lot more later!”
When a crisis strikes, the high cost of fixing it may freeze you into inaction or denial. You may want to hide behind lawyers and make yourself a small target. Unfortunately, self-preservation may not safeguard others. Failure to protect those who depend upon you may draw legal penalties far greater than the price of an early correction. Crisis manager Jim Lukaszewski is right when he says, “The first check you write is always the smallest.”
I once wrote of a client that spent four times more money fighting a battle than it would have cost to eliminate victim concerns at the start. Restitution is often far cheaper than resistance, even when a combative stance seems warranted.
The CEO may have to get involved.
With the recalled tires mostly on Ford Explorers, Ford – as opposed to sluggish Bridgestone/Firestone – worked hard to restore public confidence – even going so far as to shut down vehicle assembly plants to make more replacement tires available for consumers. (Ford even continued to pay the idled employees.) Published reports said CEO Jacques Nasser personally lead the crisis management effort involving thousands of Ford employees. He reportedly demanded that they focus on helping customers as much as possible. Nasser’s intimate involvement ran counter to a crisis rule that a crisis team should manage a crisis while the CEO operates the company. Although Ford remained under fire for being too slow to recognize the problem, Nasser and Ford got points for their efforts. (It was weeks before Nasser’s counterpart at Bridgestone/Firestone surfaced.) We may have to reconsider the no-CEO crisis rule.
As the Firestone recall joined the pantheon of PR disasters, it compels me to repeat a warning I have made before. 9 out of 10 CEO’s expect a crisis to strike their company. Fewer than half have done anything to prepare for one.
