01.15.05
ISSN:1528-3836
© 2005 Jonathan Bernstein
Circulation: 4,000+
Estimated Readership: 14,000+
JUST A THOUGHT
Never interrupt your enemy when he is making a mistake.
Napoleon Bonaparte
CRISIS MANAGER UNIVERSITY
Editor's Note: A wise CEO recently asked me to give my Crises: How to Prevent Them and What to Do When You Can't class to ALL of the employees in his multi-location company because he agrees with the point of this article -- that the actions of those in contact with customers/clients can make or break an organization. Here are two case histories -- one right way, one wrong way. Although they are about two businesses, I'm sure that my readers in not-for-profit and governmental organizations will see how the principles discussed in this piece apply to them as well.
Customer Service -- The Front Line Of Crisis Management
By Jonathan Bernstein
If a significant number of your customers/clients get so turned off by how they're treated that they "vote with their feet and wallets" and take their business elsewhere, you'd probably consider that a crisis, right?
The shame is that all too many business leaders:
- don't even know when this is happening, as they have no satisfaction verification system; and/or,
- grossly underestimate the power of negative word-of-mouth (which these days is dramatically enhanced by Internet-centered communication); and/or,
- are arrogant enough to believe that they're so good, or so unique, that people will continue to use their service no matter how bad their experience, ignoring the reality that few of them are Bill Gates.
Let's take a look at two incidents where customer service failed -- one subsequently handled well by that organization's CEO, the other handled very poorly.
Hospital Blunder
Frequent "Crisis Manager" contributor Bob Aronson was recently motivated to email a letter to the CEO of what I have renamed "Local Hospital" to preclude embarrassing the institution. Bob's letter began as follows:
Dear Sir:
Your hospital has a wonderful reputation for cardiac care and so I am sure you will find this letter about your emergency room service appalling. I am a very angry patient.
I am a 65 year-old Caucasian male with cardiomyopathy, an ejection fraction of 15 and an ICD implant. Upon arriving at your emergency room with all the symptoms of a heart attack, I was treated rudely and without concern. When I complained that I might be experiencing a heart attack your receptionist called security to have me removed from the premises. With the assistance of my wife, we left Local Hospital and went to Another Local Hospital, where I was seen and treated immediately. Do I have your attention?
I am a professional health care brand communications consultant known by all with whom I work as an even-tempered gentleman. I have the knowledge, experience and contacts to get the attention of the news media, regulators and legal authorities if I so choose. I am sure that such extreme action is unnecessary and that is why I have chosen to bring this incident of incompetence and concern for paperwork over patient care to your attention.
On Sunday evening October 25, 2004, while visiting from Minnesota, I experienced excruciating and radiating pain in my left shoulder, neck and arm while eating dinner. Because of my severe heart condition, I quickly made the decision to get emergency help. Because Local Hospital was closest to our location and because our hosts made it clear that your hospital had an excellent cardiac care program, my wife (Robin) quickly drove me to your hospital emergency room at about 8 PM. I was nearly immobilized with pain and remained in the car while my wife ran into your emergency room to get someone to help me into the building. There was no hospital employee at the reception desk or anywhere in sight.
She waited for several minutes and finally returned to the car where she assisted me into the ER herself. There were several waiting patients but no hospital employees. We waited for about ten minutes before my wife, frustrated by this amazing situation, entered a "Staff Only" door and told a female staff member that I, her husband, was in the lobby and may be having a heart attack. She noted that she needed help because there was no one at the reception desk. The woman acted unconcerned and told Robin that she would send someone out. At least 5 more minutes passed before the same woman meandered out with a clipboard saying we should sit down and fill out a detailed form. For the second time we explained my heart condition and my pain to her. The pain was obvious; I could not move my left arm, I was perspiring and experiencing shortness of breath. Looking annoyed, she re-entered the "Staff Only" door still holding the clipboard absent my information. She did not return for several minutes. When she did she ordered us (not asked, ordered us) to proceed toward a window to talk with her. I said, for the third time, "I may be having a heart attack, please let me see a doctor." Her terse response, "We have to get you into the system first." In my agony and fear, I lost my temper and loudly stated that I didn't give a damn about her paperwork, I wanted to see a physician." She repeated that she had to get me into the system first but because of my attitude she was calling security (I think she pushed a button under her desk to do so). We were so furious and I was in such intense pain we left the hospital for Another Local Hospital despite my condition and the greater distance. Your employee's attitude was that my medical complaint was getting in the way of whatever else she was doing. Our estimate is that we spent close to 30 minutes in your emergency room.
Bob's letter then explained in some detail how the other hospital had seen him promptly, diagnosed the problem (fortunately not a heart attack) and treated it appropriately.
Just minutes after Bob's email was sent, this email reply came from Local Hospital's CEO:
Dear Mr. Aronson,
I have just received you letter regarding your treatment at our Emergency Department. I too am appalled by the events you have described. What you described is absolutely unacceptable.
Please be assured I will personally investigate your visit to our ED. Once that is complete, I will be communicating with you regarding what corrective action we have taken and what we will be doing to ensure that it never happens again. While we cannot change what has occurred to you, we will prevent this from happening again.
Please accept my apology for the action of our associates that evening. I do appreciate your time and effort to communicate with me directly what transpired.
Poor customer service, whether institutionalized at an organization or delivered by inadequately supervised personnel, is seldom isolated to a single incident. How much business did this hospital lose, and how much ill will was created, before Bob wrote his letter?
In Bob's case, at least, the CEO did as he'd promised and, hopefully, Local Hospital's patient relations has taken a dramatic turn for the better.
On the other hand, there is the...
Foolish ISP
There are few industries today as competitive as Internet Service Providers (ISPs). You might surmise, therefore, that wise ISP leadership will do all it can to retain customers.
The Bernstein Crisis Management website was hosted by a company I'll rename Strong Regional ISP (because they were a one-time client and the ethics of naming them is questionable) for a couple of years after I got tired of fighting my way through Earthlink's customer service system. Because it was relatively small, it was far easier to reach technical or executive staff and, for quite a while, I was very pleased with its service.
Then one day, one of the authors whose publication I feature on my Bookstore page wrote to say, "What happened to my listing on your site?" I went to the page -- and found half of the content missing! I then browsed around the site and found that a lot of other material had disappeared as well, and that the navigation buttons weren't working. Since my website elicits around 90 percent of my new business, this was definitely a potential crisis.
My Webmaster, Oliver Del Signore, contacted Strong Regional ISP's tech support and found that -- to put it simply -- the company had migrated to a new type of server THAT COULD NOT PROPERLY HOST THE TYPE OF WEB PAGES I AND MANY OTHER BUSINESSES USE. He was not given any fix other than to completely re-do hundreds of Web pages, work for which I would have had to pay.
I sent an immediate, considerate and detailed, "I'm sure you weren't intentionally causing harm, can you please fix this right away" email to Strong Regional ISP's Webmaster (who is in charge of tech support there) with a cc to the company CEO.
No response.
The next day I sent another email to both, and left voicemail for the CEO.
No response.
The NEXT day I left voicemails for the CEO and one of his senior execs with whom I had had past contact, and sent email to both of them and the Webmaster.
No response.
The next day I directed Oliver to move the entire site over to BAPORT.com, an ISP run by a trusted friend of mine, Skip Pratt. It was moved, quickly and seamlessly, without even a burp in search engine ranking.
If I had to guess, Strong Regional ISP simply failed to anticipate the full effect of its migration to a new server and then got paralyzed by the flood of complaints which resulted, having no crisis response plan to deal with emergencies. Whatever the reason, I have little doubt that it cost them a lot of business and created a lot of ill-will. Many businesses would not have had the immediate contact with an alternative ISP and probably took longer to migrate elsewhere.
ALL THEY WOULD HAVE HAD TO DO to retain my business, at least until a fix could have been found, would have been to send an empathetic and personalized reply. Or call me. Even a second-best "form letter" that explained why this had happened, that they had failed to plan for the impact, and asking for customer patience, would have mollified me for a little while. Instead, by not responding at all, they said, loudly and clearly:
- We don't care about you.
- We don't want your business.
- We're incompetent.
So, while I'm sparing the company from being named here, if any reader is based in Southern California and wants to know which ISP to avoid, contact me.
Editor's Note: Rick Boyer and I served on a conference panel together, where he first presented these ten points that he was gracious enough to convert to article format at my request. His guidelines on crisis-related legal actions are, based on my experience working with attorneys, quite stringent and not often practiced to this degree. But if you'd rather be safe than sorry....
The Top Ten Legal Actions In The Event Of A Company Crisis
By Richard L. Boyer, Esq., Lucas Boyer & Haverkamp, APC
The following ten steps should be incorporated into every company's Crisis Response Policy. Ensure that all officers and managers are familiar with these steps, and that they will be immediately implemented in the event of a crisis.
1. Advise Legal Counsel.
Get your lawyer on board immediately. You need someone keeping an eye on the legal issues you currently face or may face in the future. All company actions and statements in response to the crisis should be vetted by your lawyer.
2. Suspend Electronic Communications.
Email communications within your company are discoverable. Don't create evidence for opposing parties. An email should be sent to all employees who communicate via email within the company stating that, on orders of legal counsel, the topic of the crisis is off limits for email communications until further notice. Employees and consultants handling the crisis who need to communicate via email should copy legal counsel on every email, and each such message should carry this label at the bottom:
This email message is for the sole use of the intended recipient and may contain confidential and privileged information. Any unauthorized review, use, disclosure or distribution is prohibited. If you are not the intended recipient, please contact the sender by reply email and destroy all copies of the original message.
3. Suspend Internal Memos Regarding the Crisis.
Internal memos are discoverable. In whatever manner is most effective, communicate to all pertinent employees that, on orders of legal counsel, issues pertaining to the crisis are not to be communicated via memo.
4. Prohibit Unnecessary Discussion Regarding the Crisis.
Unless communications take place with legal counsel present, all communications are discoverable. If employees are required to testify about the crisis, they may be forced to reveal the specifics of any discussions they had regarding the subject, including the identities of the participants in the discussion. The safe course is to prohibit all unnecessary communications regarding the crisis within your company.
5. Suspend Records-Destruction Activity.
Immediately suspend your records-destruction procedures until your legal counsel authorizes their resumption. You are legally obligated to preserve evidence if litigation or a criminal investigation is anticipated. Destruction of evidence is a serious charge whether made in a civil or criminal proceeding.
6. Back Up Your Hard Drives and Store Offsite.
Electronic discovery is becoming commonplace. To avoid disruptions to your business in the event of a subpoena, search warrant, or demand for production of your computer hard drives, immediately back them up on suitable media and store the back-ups offsite.
7. Identify, Segregate, and Secure Pertinent Documents.
All documents pertaining to the crisis will eventually be required. Do not wait for the subpoena, demand for production, or law enforcement serving a search warrant to begin collecting these documents. The disruption to your business will be minimized if all pertinent documents are collected and secured in segregated files in an organized and thorough manner before the crisis escalates. An employee who can verify and, if needed, testify about the thoroughness of the collection effort should be designated the custodian of these records. Within these segregated files, further segregate and clearly label all attorney-client privileged documents.
8. Have Legal Counsel Interview Pertinent Employees.
While memories are fresh and unaltered by gossip and communal reflection, your lawyer should interview all employees with knowledge pertaining to the crisis. Having the lawyer conduct the interviews should guarantee the information elicited will remain confidential. If possible have outside counsel perform this task to avoid the possibility your corporate counsel will become compromised and the interviews become discoverable.
9. Report the Crisis to Appropriate Governmental Entities.
If your business is subject to oversight by a governmental agency or agencies, report the crisis immediately. Even if such reporting is not required, keeping them in the loop about developments will help to avoid antagonizing them.
10. Contact Your Insurance Company.
Provide early notice to your insurance carrier to avoid a denial of coverage due to untimely reporting. Some insurance coverage is triggered if there is even a possibility that coverage might apply, so even if you are certain the crisis does not trigger coverage, tender the matter to your insurer and let it provide a written denial.
Richard Boyer, a founding shareholder of Lucas Boyer & Havercamp in San Diego, has more than 15 years as a litigator, with a practice focused in the areas of Long Term Care and Business Litigation. Contact: (858) 535-4000 or rboyer@lbhlawfirm.com.
CRISIS MANAGER BUSINESS ANNOUNCEMENTS
Teleseminar: Crisis Management & The Law
How PR Pros & Lawyers Can Work Together Effectively
Featuring Richard Levick and Ed Novak
February 23, 2-3 p.m. Eastern
I am VERY excited to be re-starting my teleseminar series with a subject many of you think is "hot" -- Crisis Management & The Law -- and two stellar co-presenters. Whether attempting to prevent or respond to crises, constructive and successful interaction between attorney and public relations professional can significantly enhance results. Conversely, if they're butting heads, the results can be disastrous. Wise attorneys know that public relations considerations must be included in a CEO's deliberations, and vice versa. Not just when faced with litigation, but also when engaged in other sensitive transactions.
About My Presenters
In this teleseminar, I will play "talk show host/interviewer," with my call-in audience also being encouraged to ask questions of:
Richard S. Levick, Esq, the President of Levick Strategic Communications (www.levick.com), the worldwide leader in legal media. The firm has managed the media in nearly 3,000 legal matters and crises, representing nearly half the 100 largest law firms in America and their highest profile clients. Front page engagements have ranged from the Catholic Church and Guantanamo Bay, to Rosie O'Donnell and Napster. Richard and his firm have published acclaimed books, including Stop the Presses: The Litigation PR Desk Reference. His articles appear regularly in publications throughout the world: For the Defense, Legal Times, The European Lawyer, Mealey's Emerging Toxic Torts, Law Practice Management, and Asian Counsel, among others. Richard gives over 50 speeches a year on litigation communications and crisis media. This year, for example, he keynoted In House General Counsel conferences in China, Hong Kong, Australia, India and New Zealand as well as dozens of speeches throughout the U.S. He is a frequent commentator on radio and television on high-profile cases. PR News honored Richard Levick as the Public Relations Professional of the Year for US Agencies in 2002. He holds a master's degree in Environmental Advocacy (Communications) and a Juris Doctor degree.
Edward F. Novak, head of the White Collar Crime practice at "top 100" law firm Quarles & Brady (www.quarles.com). He has extensive jury, non-jury and appellate experience in criminal defense matters, complex civil litigation and government agency investigations in several areas including healthcare, environmental, procurement fraud, RICO and securities. Ed's recent experience includes representation of a prestigious national health care organization in a multi-federal district and multi-state investigation into patient billing fraud; defense of a Big Five accounting firm in multiple simultaneous proceedings in federal and state court involving both civil and criminal litigation; defense of a publicly held mutual fund company in connection with a federal fraud probe; defense of municipality in a fraud probe alleging civil rights violations; defense of a national home builder in connection with a multi-district federal and multi-state investigation of clean water act violations and representation of a large national retail securities firm in connection with a federal and state investigation into the fraudulent sale of oil and gas limited partnerships. He has also provided expert witness testimony on issues of ineffective representation in criminal cases and legal malpractice in civil cases. Ed and I have worked together on a number of crisis management situations.
Questions to be answered will include:
- If the attorney and PR person disagree, to whom should the CEO listen most closely?
- When do PR considerations outweigh legal considerations, and vice versa?
- What types of legal matters require close collaboration between legal and PR counsel?
- What can a PR person do when dealing with an attorney who just doesn't "get it" with regard to crisis communications?
- What can an attorney do when his client doesn't seem to understand the need for complementary PR?
- What are some "right way/wrong way" examples that illustrate the principles of effective crisis management in legal matters?
There are also at least two marvelous giveaways associated with this teleseminar: Stopping the Presses: The Litigation PR Desk Reference co-authored by Richard Levick, and the 30-page Guide for Responding to Governmental Inquiries by Ed Novak and other members of his White Collar Criminal practice group.
Cost: $95 for as many people as you can crowd around a speaker phone. A CD-ROM recording will be for sale post-teleseminar at the same price. To register and obtain more information, go to: http://www.thecrisismanager.com.
PLAIN ENGLISH DISCLOSURE
Bernstein Crisis Management, Inc. has formal or informal co-promotional and mutually beneficial business associations with a number of the services we mention periodically in this newsletter. No, we can't go into details because that's confidential, proprietary, etc. But our relationship is NOT "arm's distance" and you should know that, since we regularly write about these services as we use them for crisis and issues management or other purposes. That said, you should also know that Bernstein Crisis Management sought the relationships because its staff is convinced that these services are the best of their kind for Bernstein Crisis Management's needs and those of its clients. If you have any questions about these relationships, please contact Jonathan Bernstein, (626) 825-3838.
ABOUT THE EDITOR & PUBLISHER
Jonathan Bernstein is president of Bernstein Crisis Management, Inc., www.bernsteincrisismanagement.com, a national crisis management public relations agency providing 24/7 access to crisis response professionals. The agency engages in the full spectrum of crisis management services: crisis prevention, response, planning & training. He has been in the public relations field since 1982, following five-year stints in both military intelligence and investigative reporting. Write to jonathan@bernsteincrisismanagement.com.
Bernstein Crisis Management, Inc. is located at 1013 Orange Avenue, Monrovia, CA 91016. Telephone: (626) 825-3838.
GUEST AUTHORS
GUEST AUTHORS are very welcome to submit material for "Crisis Manager." There is no fee paid, but most guest authors have reported receiving business inquiries as a result of appearing in this publication. Case histories, experience-based lessons, commentary on current news events and editorial opinion are all eligible for consideration. Submission is not a guarantee of acceptance.
LINKS
When I find a site that I think will be useful to my readers or site visitors, I put it on our Links page. If you have a site that would be of specific use to crisis managers and want to discuss a link exchange or other cooperative effort, please write to me, jonathan@bernsteincrisismanagement.com.
LEGAL DISCLAIMER
All information contained herein is obtained by Jonathan Bernstein from sources believed by Jonathan Bernstein to be accurate and reliable.
Because of the possibility of human and mechanical error as well as other factors, neither Jonathan Bernstein nor Bernstein Crisis Management is responsible for any errors or omissions. All information is provided "as is" without warranty of any kind. Bernstein Crisis Management and Jonathan Bernstein make no representations and disclaim all express, implied, and statutory warranties of any kind to the user and/or any third party including, without limitation, warranties as to accuracy, timeliness, completeness, merchantability, or fitness for any particular purpose.
Unless due to willful tortuous misconduct or gross negligence, Jonathan Bernstein and Bernstein Crisis Management shall have no liability in tort, contract, or otherwise (and as permitted by law, product liability), to the user and/or any third party.
Under no circumstance shall Bernstein Crisis Management or Jonathan Bernstein be liable to the user and/or any third party for any lost profits or lost opportunity, indirect, special, consequential, incidental, or punitive damages whatsoever, even if Bernstein Crisis Management or Jonathan Bernstein has been advised of the possibility of such damages.
A service of this newsletter is to provide news summaries and/or snippets to readers. In such instances articles and/or snippets will be reprinted as they are received from the originating party or as they are displayed on the originating website or in the original article. As we do not write the news, we merely point readers to it, under no circumstance shall Bernstein Crisis Management or Jonathan Bernstein be liable to the user and/or any third party for any lost profits or lost opportunity, indirect, special, consequential, incidental, or punitive damages whatsoever due to the distribution of said news articles or snippets that lead readers to a full article on a news service's website, even if Bernstein Crisis Management or Jonathan Bernstein has been advised of the possibility of such damages. Authors of the original news story and their publications shall be exclusively held liable. Any corrections to news stories are not mandatory and shall be printed at the discretion of the list moderator after evaluation on a case-by-case basis.
OTHER IMPORTANT STUFF
Do you know people who are Crisis Managers, whether they want to be or not? Please pass this newsletter on to them!
Subscribe to the free, twice-monthly email newsletter below. After entering your email address, you will receive a message asking you to confirm your subscription in order to prevent someone else from adding you to the list without permission. YOU MUST CONFIRM YOUR SUBSCRIPTION OR YOU WILL NOT RECEIVE THE NEWSLETTER.
Articles in "Crisis Manager" were, unless otherwise noted, written and copyrighted by Jonathan Bernstein. Permission to reprint will often be granted for no charge. Write to jonathan@bernsteincrisismanagement.com.
|
