Charlie Pownall 查理·保诺

It came as something of a shock. Arriving in Singapore from London in 2006 to run a global PR consultancy’s digital capabilities across Asia-Pacific, it quickly became clear that while digital marketing in the region was in rude health, corporate use of digital communications was often poor and sometimes non-existent.

Why?

Budgets were small and the outlook mostly short-term. Many firms were struggling to understand the role and value of online PR. Key stakeholders were apparently not yet using Twitter. For companies, websites were Kings; email and search were its Queens and social media was but an Infant mewling about buzz and bloggers.

Much progress has been made over the past few years, not least a broad realisation that a proactive approach to digital communications that includes social media is a must-have. And well it should be. Asians are some of the most mobile, networked and digitally-savvy individuals in the world. The world’s most social consumers in virtually every product category, Asians not only consume huge volumes of online content but also create more videos and other output than people in any other region.

Equally, many Asians are increasingly aware of their rights as consumers and citizens and are prepared to take a public stand when they see these rights compromised. Negative product and service experiences are widely shared online, as firms such as Vodafone and Dolce & Gabbana have discovered to their cost. Civil society actors such as WALHI in Indonesia are using the Internet and word of mouth highly professionally to force change. Suddenly, the range of potential reputation red lights has expanded significantly.

While there has been a flowering of company Facebook pages and Twitter and Weibo handles over recent years, there remains plenty to do if organisations are to fully leverage the benefits and limit the threats inherent in today’s digitised communications landscape.

VMA’s recent Pulse study on corporate communications trends in Asia identifies three key digital challenges for corporate communication teams:

Thin understanding and education
Lack of budget, dedicated or otherwise
Concerns about what employees may say online.

How should corporate communications teams accelerate their digital transformation? Here are three topline recommendations:

Education: While much traction for social media can be gained through trial and error, substantive progress is unlikely to be achieved without the buy-in of company leadership. Make a though and objective assessment of the broad range of opportunities and risks of social media and, if you don’t have one already, identify a strong and respected internal executive champion to establish ownership and authority, take responsibility for educating the CEO and other senior leaders, and to sell the vision. If that individual is in brand marketing or another function outside communications, make sure they are on your side and that you have a consistent vision. And whichever operating structure is chosen for digital/social media (centralised, de-centralised etc), ensure your team is actively playing its part and leveraging its known strengths: internal access and influence, external listening and engagement, management of corporate reputation.

Budget: Budgetary support will increase as a result of leadership confidence and buy-in. Don’t get hamstrung just because there is not a standalone digital/social corporate communications budget or figure that social media should live in PR. Many firms now have dedicated social media teams that sit independently of communications; for instance, while social media resides within marketing at Ford, the Digital Acceleration team at Nestle owns social media and reports simultaneously to marketing and corporate communications. Beyond this, be clear what you are trying to achieve and report regularly using metrics that are relevant and understandable to top leadership.

Behaviour: Increasingly, communications is seen to work in the long-term interests of a company’s reputation, providing it with a legitimate interest in ensuring sound employee behaviour. Accordingly, communications should work closely with other relevant areas of the business to identify and mitigate possible behavioural reputational risks, rather than simply having to manage them once they occur. Many organisations now have a corporate social media policy of some description that sets out the parameters of employee behaviour in social media, but few have successfully ensured that their people (as well as others within their ecosystem such as sales agents) fully understand and live by these documents.

In my experience working both in in-house PR and as an external communications and social media consultant, the image of corporate communications can suffer by appearing too far removed from the realities of day-to-day life in the trenches.

Social media makes managing reputation in real-time a company-wide prerogative. Corporate communicators must get into the trenches and fight the good fight. Being seen to do this will help accelerate digital as much as anything else.

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First published on VMA Group blog. I am an Associate at VMA Enhance, VMA’s professional development arm

There is much talk in social media and marketing circles about ‘digital’ or ‘social media’ crises.

There are no such things.

A crisis is a crisis, a one-off incident or series of events that seriously impacts the reputation and/or performance of an organisation – think BP’s Gulf of Mexico oil spill, the BBC’s Newsnight meltdown or Yum Brands’ recent KFC woes in China.

While the internet and social media can escalate and amplify both ‘digital’ and ‘traditional’ issues, the great majority of significant reputation problems directly attributable to social media are small.

Types of crisis

According to a recent study by law firm Freshfields Bruckhaus Deringer, operational crises such as significant product recalls or environmental lapses have the greatest long-term impact on a firm’s share price (and reputation), while behavioural crises such as rogue employees or corruption have the severest short-term impact.

This feels accurate, and it is useful to see it quantified.

Here’s how Freshfields categorises crises:

Behavioural: allegations of illegal or questionable conduct by the company or specific employees, including claims of bribery and corruption; senior employee misconduct or human rights violations.
Operational: where the company’s ability to function is seriously impaired, such as significant product recalls or environmental incidents.
Corporate: a crisis affecting corporate or financial well-being, including liquidity issues or material litigation.
Informational: where a company’s IT infrastructure or electronic data systems are seriously impacted, including system failures; hacking and loss of customer data.

Most crises are informational

Most incidents emanating from or being played out in social media fit into one or more of the categories above. Research (see below) indicates that the majority of social media risks are informational in nature.

McKinsey-Risks-Use-of-Social-Tech-Mar2013

Worryingly for reputation and risk managers, the most damaging in terms of reputation are behavioural and involve their own employees. Experience and observation suggest the main drivers of so-called ‘digital’ reputation issues are:

Customer service – complaints about poor product quality and/or customer service eg. Vodafone’s Vodafail in Australia
Customer feedback – failure to listen to customer needs, requirements and concerns eg. Netflix’s sudden price hike
Marketing – inappropriate, misleading or offensive marketing and advertising eg.
Nivea’s Re-Civilise campaign
Social media campaigns – often caused by a lack of alignment between marketing and PR eg. #QantasLuxury or #McDStories
Employees – disgruntled or poorly trained employees eg. Domino’s Pizza mucus video.

Of these, only inappropriate use of social media by employees, failed standalone social media campaigns and poor online customer service can surely be construed as ‘digital’ and result largely from inadequate professionalism and a lack of coordination between marketing, sales, PR and customer service.

Smart organisations have learnt to educate their people about their online behaviour and to integrate their social media campaigns and online customer service.

Regrettably, bona fide crises will continue. But the death of the ‘social media’ crisis is surely nigh.

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First published by Social Media Today

—Charlie Pownall 查理·保诺

Reputation management and communications

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Types of crisis

Most crises are informational

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