Lawyers vs. Communicators in a Crisis

The frequent conflict between the advice of lawyers and that of communicators is one element of an interesting New York Times story on handling terrible news. The piece uses the BP, Toyota and Goldman Sachs debacles to tell universal lessons of crisis communications.

Here’s the link to the story, but if it’s too long for you, below are some excerpts and good quotes from well-known crisis communications professionals. http://www.nytimes.com/2010/08/22/business/22crisis.html?_r=1&hp=&pagewanted=all
Paragraphs that do not quote someone directly were taken verbatim from the Times story.

As conventional wisdom has it, the three companies at the center of these fiascos worsened their problems by failing to heed established protocol: When the story is bad, disclose it immediately — awful parts included — lest you be forced to backtrack and slide into the death spiral of lost credibility.

“Companies that typically handle crises well, you never hear about them,” says James Donnelly, senior vice president for crisis management at the public relations colossus Ketchum… There’s not a lot of news when the company takes responsibility and moves on. The good crisis-management examples rarely end waving the flag of victory. They end with a whisper, and it’s over in a day or two.”

Measuring success in a crisis

“The two things that are very hard to survive are hypocrisy and ridicule,” says Eric Dezenhall, a communications strategist in Washington. “It’s the height of arrogance to assume that in the middle of a crisis the public yearns for chestnuts of wisdom from people they want to kill. The goal is not to get people not to hate them. It’s to get people to hate them less.”

[BP] had to contend with a classic corporate quandary of balancing advice from counselors with starkly different considerations, according to people familiar with BP’s deliberations who requested anonymity because the advice was confidential.

In times of crisis, communications professionals and lawyers often pursue conflicting agendas. Communications strategists are inclined to mollify public anger with expressions of concern, while lawyers warn that contrition can be construed as admissions of guilt in potentially expensive lawsuits.

For BP, this tension burst into view in May, when executives went to Capitol Hill with officials from two of its contractors: Transocean, which owned the offshore rig that exploded, and Halliburton, which aided BP in drilling. Executives from the three companies each disowned culpability while pointing fingers at one another.

“What that screamed is the lawyers are in control," says [former Merrill Lynch media relations vice president Eddie] Reeves. "All it did was get everybody all the more peeved at them.”

People will forgive an honest mistake but not a dishonest cover-up

Of Toyota, Reeves said, “When you’re in the mix of these really obtuse situations where nobody really knows the facts, in some sense the facts are less important than your posture toward the facts. People are reasonable. They know companies make mistakes, and people will forgive an honest mistake. They will not forgive a dishonest cover-up.”

Yet seeking a way around a painful public reckoning appears to be a nearly universal approach to corporate crises. In the long run, the best course for an embattled company may be swiftly owning up to its errors. But to human beings stuck with the task of disclosing embarrassing details here and now, dissembling and delaying may beckon as the easiest way to get through the day.

Children stuck on scary roller coasters sometimes close their eyes and wait for the ride to end. So, apparently, do grown-ups heading giant corporations in crisis. This is the conventional explanation for how three enormously successful enterprises managed to prolong and deepen their public relations agony.

“These companies made the same mistakes,” says Howard Rubenstein, the public relations luminary who represents the New York Yankees and the News Corporation. “They broke the cardinal rule of crisis management: They didn’t seem to have a crisis plan in hand. They sought to minimize the extent of their problems, and they never seemed to display an understanding for the situation they were in.”