Damage Control (Revised & Updated). Eric Dezenhall

and institutions in the narrative. When Jaws’s Chief Brody observed that Quint’s crew needed a bigger boat, he was doing more than making an observation; he was making a strategic assessment of both the practical tools that would be needed to catch the great shark and inquiring about the resolve of the shark-hunting team.

      Resolve must be anchored in a realistic appreciation of the challenges at hand. Ironically, in an age of crisis, business culture is living in a “Spintopia”—an environment in which business schools, consultants, and pundits dispense Mother Goose aphorisms about crisis management that contradict what real-world life experience teaches. The advice crisis consultants give is often designed to benefit the consultant, not the client.

      We’re in the crisis management business. A crisis manager’s job is to make bad news go away. We are the trauma surgeons of public relations. Corporate scandals, high-profile litigation, product safety allegations and recalls, boycotts, brand smears, government investigations and prosecutions—these unwanted events are our daily challenges.

      Conventional public relations is enamored with “reputation management,” “empowerment,” “trust,” “the message,” and other guru-driven happy talk that serves little purpose other than to give people in very tough situations the illusion of control.

      “Martha Stewart just needs to apologize,” a pundit says on CNN. “If Nixon had just said right away, ‘I screwed up,’ there would have been no Watergate scandal,” a political science professor speculates. “If Coca-Cola had just recalled their product right away, that whole Belgian mess wouldn’t have happened,” a business school case-study lecturer asserts. “We’ve got to tell’em all the good things your products do,” a public relations account executive assures her polluting client in a new-business pitch, adding with a sparkle, “Remember, a crisis is an opportunity to get your message out!”

      Crisis management is the enterprise of telling ugly truths. Ideally, it is the pursuit of redemption in the marketplace. When one has done wrong, repentance is required. When one has been wronged, a vigorous defense must be mounted.

      Even before the meeting at Socrates formally began, our team, drawing on eighty collective years in the high-stakes communications business, saw four telltale signs of crisis management doom: 1. The chief executive officer was absent.

      The task of crisis and issues management had fallen to Socrates’ public relations chief. There’s no question that the chief communications officer must play a key role in the crisis, but, as a rule, companies that see communications as the answer to its problems rarely have the management juice to make the decisions necessary to resolve the crisis. Does the PR chief have the authority to recall a product? Can she order a product reformulation? Can she shut down—and then reboot—worldwide production and distribution? Does she have the ear of Wall Street analysts? Does she have bet-the-company authority? The answer to all these questions is probably no.

      In times of crisis, the chief executive officer must be the chief crisis officer, or, if not the CEO, the business unit chief who has the authority to make fundamental decisions. In the gathering at Socrates, the real powers to resolve the crisis were not in the room.

      2. There were too many people at the meeting.

      The boardroom was filled. There were more than twenty people gathered from every discipline within the company, not to mention other outside consultants. Many of them were primed to take notes on laptops. The group leader was very pleased that she was seeking “input” from Socrates’ “diverse knowledge partners.” The corporate-speak was suffocating and betrayed the true purpose of the meeting: making the participants feel comfortable with the process.

      Effective crisis management teams are small. While they may indeed collect input from a variety of sources, they are not meant to be New Age esteem-building entities where everybody has a voice and gets to feel special. That so many of Socrates’ players were ready to memorialize the meeting’s proceedings on their laptops was a blaring warning sign. It’s a safe bet that these jottings would wind up in court or on the front page of the Wall Street Journal.

      3. Someone mentioned the “Tylenol case.”

      One of the more hackneyed features of most introductory crisis management meetings is the obligatory citation of the famed 1982 Tylenol case in which seven people died as a result of cyanide poisoning from tainted Tylenol capsules. The brand famously recovered after a product recall and introduction of tamper-resistant packaging. Our ill-fated meeting with Socrates was to be no exception. A PowerPoint image on the screen referenced the Tylenol case, and an exuberant midlevel employee was poised to present an argument for capitulation.

      While there are many admirable features of the Tylenol case (which will be explored in depth later), its invocation has become a mantra for managers desperate for a guaranteed happy ending. In reality, the Socrates crisis has little in common with the Tylenol case.

      4. Someone recommended more research, a plan, and the formation of a committee.

      There’s a myth that the biggest threat to sound crisis management is panic. Actually, it’s quite the opposite: The biggest threat is the instinctive corporate desire to do nothing when facing danger. “Doing nothing” can never be openly presented as a viable option, of course. So, it is introduced with the thoughtful observation that “we shouldn’t run off half-cocked” and then followed by a series of memos, plans, presentations, and the like that make people feel busy but do little to calm the raging seas of pending disaster.

      Here’s the dirty little secret of the procrastinators: It is not so much that they oppose action per se; it’s that they neither know what to do nor have any tolerance for risk of any type. Memo anyone?

      In the crisis management business, we don’t turn away work on the grounds that a case appears to be difficult—a crisis by nature is supposed to be hard. Nevertheless, we cannot help save an enterprise that does not want to be saved. We didn’t sign on with Socrates because we felt the company was constitutionally incapable of resolving its crisis.

      Our business by its very nature is intimate, and we take on a limited number of cases, preferably those for which we can make an impact. “Impact,” of course, doesn’t necessarily mean victory, but it does mean there is more likely to be a correlation between input and results.

      Crisis management, while a rare corporate discipline, is nevertheless a fundamental one because the future of the enterprise is on the line. A grieving widower appeared on Larry King Live in 1992 and speculated that his wife’s terminal cancer was caused by a cellular telephone: Motorola, the leading cell phone manufacturer, saw its stock drop by 20 percent in the following days. Merck’s recall of its arthritis drug Vioxx cost the company roughly $750 million in the fourth quarter of 2005 alone; a Merrill Lynch stock analyst estimated that damages against the company could run between $4 billion and $18 billion. Perrier was toppled from its perch atop the best-selling bottled water mountaintop after the chemical benzene was found in its product. And when the Audi 5000 was accused of “sudden acceleration,” its sales evaporated and the Audi brand essentially vanished from the U.S. market for a decade.

       WHO SURVIVES?

      Damage Control examines these survival factors in greater detail later; however, our encounter with Socrates strongly suggested that this company didn’t have what it takes to weather the hurricane it was facing. Companies (and individuals) that survive crises tend to have certain features in common, features that are often evident in the first moments of an engagement:

      • They have strong leaders who have broad authority to make decisions.

      • They question conventional PR wisdom and do not worship at the altar of feel-good gurus who espouse “reputation management,” the canard that corporate redemption follows popularity.

      • They are flexible, changing course when the operating climate shifts (which it usually does).

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