Response Matters

Remember the little boy standing at the counter of a corner shop? “What about me?” he says.

Most corporate communications are written and disseminated in a manner that serves the corporate purpose, stating the organisation’s case with sometimes scant regard for how that response will be received by different stakeholder groups.

Every piece of information sent out by an organisation has multiple (sometimes multiples in the millions of) receivers. But most organisations still think in terms of sending rather than receiving.

This is particularly apparent when things go wrong. Yet this is when it is most important to get key messages right; to be engaging with language; to think carefully about the chosen mediums of distribution to ensure timely reach. It is about being effective in minimising damage.

Reputational risk is greater than liability risk and can actually do more damage. The value of word-of-mouth recommendations is well documented. So too, the hundred-fold greater impact of word-of-mouth complaint.

This is especially important today as the distribution channels widen, blur, clutter and crash across the spectrum of senses. No longer are we always in control of our message. The Internet is both a wonderful and frightening frenzy of communication.

We all make mistakes. Our public (customers, employees, shareholders) can be very forgiving. Or not.

The resulting problem for the organisation is more often not that there was a mistake, but how they responded. Which takes me back to three points made above:

It is about how stakeholders receive your message that matters. “What about me?” is pertinent in that how you respond to a situation has different impacts on different stakeholders and they really don’t care about excuses, or reasons, or justifications, or what you might be doing for other stakeholder groups. They want to know what you are going to do about it – for them.

What you did wrong can in many situations be dissolved under the weight of what you do about it. Minimise damage.

Do it fast. Be timely in your response. Do it now.

When you start thinking in terms of how the message is going to be received and interpreted by stakeholders, it is a lot easier to start thinking about what you can do to make the situation better (for them).

Some organisations have turned negative situations into extremely positive end-results with higher customer or shareholder or community favour and loyalty and sales than they had prior to the event. All because of how they responded.

Some organisations make things worse, until the mistake itself is lost in the corporate (or political) waffle, and the situation of response becomes an escalating crisis for the organisation.

It really is a choice. You can have an extremely unhappy client who will never deal with you again and will tell their friends, colleagues, customers and suppliers; who will tell it to all the social media sites they know of, send emails and remind people of their disasterous purchase or dealings with your business, year-on-year, to ensure they never do business with you. They might take it to A Current Affair or Today Tonight or hard-news shows like ABC’s Four Corners.

Or, through the actions you take in response to the initial situation, you can turn that unhappy client into a fan for life – an evangelical singing the praises of your business forever more. Response matters.

The lemon car is the best example of what not to do. This forum has a few stories that will make you laugh, but not if you are the owner of such a car. No amount of fixing can fix a lemon car in the eyes of the owner. Why is it so hard for car companies to see that it is so much cheaper, so much better for them in long-term sales, customer acquisition and brand value terms to replace the car the second it starts to exude a certain citrus aroma?

One of the best corporate example in recent history was the Australian Securities Exchange (ASX) and its subsidiary, Sydney Futures Exchange (SFE) “market mistake” in late 2007. Not a day went by without major media coverage of the error and the SFE response, deemed in the nicer stories as inadequate.

“What about me?” scream the traders holding the losing side of the contracts.

The market error isn’t the issue.

Two years ago, at the newly merged ASX / SFE AGM, Chairman Maurice Newman said:
“While we strive to improve our own management and governance performance, we also seek to make the markets we supervise models of integrity and efficiency.”

A lot of the losing traders would have been at that meeting.

Reputation management isn’t about how many press releases one churns out. It is about managing how the organisation is received at every touch point. A lack of, or wrong response, not only disconnects the previously engaged stakeholder, it can turn nice quiet (to stay with the analogy) well-behaved children, into screaming crying vengeful – Bloggers!

(If you like this article, see more in the book, Reputation at Risk.)

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Tags: ASX, corporate communications, lemon cars, response matters

Category: Reputation Management, Sin & Spin