News

The violent events we have recently witnessed serve as a reminder that all our contacts need to know how to minimize harm in the unlikely event they are around violent situations involving weapons. In the hope that it will save others from harm, we are sharing a two minute segment from one of our security training programs on the standard protocol for dealing with violent circumstances. Please share it with your friends and colleagues.

Government and Community Relations Actions

Government and Community Relations Actions

What should businesses do about government relations? Governments can take your money or reduce your taxes whenever they want. They can increase the cost of materials or open markets to you. Governments can regulate you into oblivion or encourage your growth. They can even take care of your stakeholders’ needs for you or compel you to provide everything for them. This is true at the national level, as well as with state and local governments. The potential impacts are enormous. It would be foolhardy to ignore them. So, what do you do? To start, learn and practice the basics of government and community relations.

Government and community relations Government affairs

In our increasingly polarized society, the stakes of government action are growing. The pendulum of history swings both ways. If it goes too far one way, eventually it will swing back in the other direction.  With less than 90 days before the November 6, 2018 elections, you need to start preparing your business for whatever direction the government will go. Whatever the results, the direction will change.

We’re not necessarily suggesting that your business take sides in the election, but you should expect change either way. The deliberate, methodical procedures of government used to allow time to adapt by insulating businesses from dramatic change. Today, those procedural protections are often disregarded. Combine this with the political posturing that is reducing opportunities for bipartisan solutions, and we have a recipe for more extreme change.

What should businesses do about Government Relations?

Most businesses operate better in stable, predictable environments. Without this stability, we are forced to find solutions for the unpredictable disruptions of our polarized and contentious political world. Some businesses are picking sides and others are seeking influence. Be careful though, since you are gambling your company’s future when you pick sides in politics. You may win for a number of years, but you only need to look at Enron to see how it eventually could work against you.

government affairs government relations

These days, even the most sophisticated businesses are finding it difficult to anticipate and respond to government actions. Some may think of government relations as a political exercise and try to bolster their connections with either Republicans or Democrats in anticipation of the next election. Others look at government relations as a public policy exercise and do their best to objectively inform government officials about the impact of issues. Small businesses may have the owner periodically inform local elected officials about their concerns, rather than dedicate staff to government relations.

Most companies try to navigate this age of disparagement, conflict, and agitation without alienating key stakeholders. For many, the best solution may be a return to government and community relations fundamentals. This helps insulate them from harm and strengthens their base of support. We’ll walk through the seven fundamentals of government and community relations below.

Seven Fundamentals of Government and Community Relations

Regardless of size, every business should prepare itself for an uncertain future. While government and community relations efforts can range from the very elaborate to do-it-yourself, there are seven key initiatives that will strengthen any program. Take these basic government and community relations actions now, scaled to the resources and needs of your business. They will dramatically improve your business’ ability to protect and even enhance its future. This applies whether you have a formal government relations function or are a one-person shop.

government and community relations

Stay Informed

This is the most fundamental need. Stay informed about developments, policy alternatives and the potential impact on your business. For the small business, this may be limited to following the news and participating in a business or professional organization. For large businesses, it’s the same plus deep analysis by experts, intelligence gathering by trade associations, consultants, and your own professionals. If you don’t want unpleasant surprises or missed opportunities, you need to know what is happening and how it will affect your business.

Build your reputation

It’s important that you develop the best possible reputation for your company. This will help prevent your business from being left out of positive legislation or the target of attacks. How others view your company, its value to the economy and contributions to society will influence government officials. A strong brand and reputation help ensure a more attentive audience. In most companies, this is managed by corporate communications or your communication consultant.

Engage in local communities

Strengthen your relationships and base through involvement in the communities where you operate. The communities that host your business are some of your most important stakeholders. They are homes to your employees and people who can influence your future. They can either oppose you and make life miserable or be your biggest supporter.

The time to make friends is not when you need them, but when you can help them. Your investment in them will pay great dividends if and when the tables turn. Start by joining the local chamber of commerce and supporting local organizations. Introduce yourself to local officials and be as helpful as you can in resolving problems. A little courtesy and involvement by you will go a long way. Someday you may be pleasantly surprised by how willingly and effectively they can return the favor.

government and community relations

Leverage your influence

Large businesses likely have a Washington office with teams of government relations professionals and outside lobbyists. They may be a member and involved in major trade associations such as the U.S. Chamber of Commerce, National Association of Manufacturers, American Petroleum Institute, American Hospital Association or the American Short Line and Regional Railroad Association. Small and large businesses may also belong to state and local associations such as the Texas Farm Bureau or Greater Houston Partnership. These are great sources of information, and they provide opportunities to collaborate with like-minded businesses. They also can help you directly express your business’ views to government officials.

Build relationships with officials

You, your government and community relations professionals, trade associations, employees and other stakeholders can also develop relationships with elected officials by attending events, writing and meeting with them. If you share substantive information, your elected representative may be better informed, share insights and become more supportive of your position. Don’t overestimate your influence, however, since the average Congressional district has about 650,000 residents, with conflicting demands for representatives’ time and energy.

Inform and engage your stakeholders

Your employees understand and care about your business. Keep them informed about issues and opportunities, so they can share their views with elected officials when needed. Man employees are involved in their communities and your most effective ambassadors. Elected officials care what people think. Also, consider keeping other stakeholders such as suppliers or business partners informed and engaged.

Consistent messages

It’s always important to have consistent messaging to all stakeholder groups. Employees, media, investors, government officials, and community leaders should all receive consistent messages and timing is also important. For instance, federal rules prohibit disclosing material information to one group of investors before another. Likewise, you don’t want employees to learn important information about the company from the news before they hear from you. Avoid conflicting messages and be sure to coordinate your company’s outreach efforts on policy matters. The government relations and communication teams need to synchronize their efforts so stakeholders’ grassroots activation complements your other legislative and administration contacts.

Conclusion

Businesses depend upon a social license to operate. These government and community relations efforts build the understanding and relationships needed to gain that support. In this way, they protect and even advance your business interests. While we may not be able to predict the future, we can prepare for and influence it. Take these steps now and you will have a say in how government policy affects your business.

Crisis Management Cultural Issues

Crisis Management Cultural Issues

Imagine an entire community emotionally paralyzed with indecision. Now, consider the impact during a crisis. This phenomenon occurs when communities suffer the sudden or traumatic loss of things that define them. It’s called Mazeway Disintegration. At their peril, most organizations do not anticipate the devastating impact of these crisis management cultural issues in their response planning. Fortunately, you can mitigate mazeway disintegration. We will walk you through how to address these cultural waypoints in your emergency response and crisis management plans.

crisis management cultural issues

Consider what happens to affected groups in an emergency or disaster.  In normal situations, our cultural reference points make it easier for us to comfortably conduct every-day life. This changes if a crisis disrupts or eliminates those cultural connections. Entire groups of people can be disoriented and even immobilized if they lose touch with cultural norms. Correspondingly, this limits their ability to cope with a disaster, compounding the difficulty of the crisis response.

If we do not mitigate mazeway disintegration’s effects, these groups may not be able to psychologically cope with the disaster. Accordingly, effective response plans need to address these crisis management cultural issues before a disaster occurs. The alternative is simply not acceptable since disoriented communities will only serve to prolong and magnify the crisis.

What is Mazeway?

First, let’s make sure we understand the term mazeway. Most of us have an organized and predictable way of doing all the things in our lives. It’s the pace, pattern, rhythm, and manner in which we interact with the world around us. It’s our mazeway.

The American anthropologist, Anthony F. C. Wallace, proffered the term, mazeway, six decades ago.  He wrote about what happens in a disaster from a different perspective.  He told the story of a Petun Indian tribe whose warriors returned home to find their village burned to the ground and every man, woman, and child a victim of a violent death or abduction.  Likewise, everything they knew, including their home, family, and possessions no longer existed.  He described their “shock” with the term mazeway disintegration.

mitigate mazeway disintegration

Socio-Cultural Disorganization

This is important because victims of other disasters often react in similar ways.  Think of people displaced by sudden onset natural disasters such as earthquakes and tornadoes.  They didn’t see it coming. Therefore, they were emotionally unprepared for a disaster taking away homes, lives and entire communities. Interestingly, this is true even if they live in an area prone to such hazards.

In these circumstances, normal mazeways disappear or become unconnected…. disintegrated.  These groups no longer have the things that connect them to the world in a way that is orderly. Moreover, being psychologically (and physically) unconnected can be severely debilitating.

Crisis management cultural issues can make it impossible for affected groups to engage in activities that would normally help. The crisis response needs to address and restore enough of the cultural reference points to allow communities to function normally. Otherwise, the response will not mitigate mazeway disintegration.

Planning for Crisis Management Cultural Issues

Preparing to mitigate mazeway disintegration is an essential component of an effective emergency response or crisis management plan. If the objective is to resolve the problem, restoring people’s lives to normal needs to be part of your planning. If you don’t do this, the problem will fester and perpetuate the crisis.

To mitigate mazeway disintegration, you need to have some understanding of what their maze looked like before the disruption.  Likewise, rendering assistance beyond basic first aid can either support a return to normalcy or add exponentially to the problem. In fact, you may exacerbate the problem if you fail to address the group’s cultural norms and crisis management cultural issues.

crisis management cultural issues

Business and Cultural Interactions

Think of all the different cultures affected by a large multinational miner, manufacturer, producer, refiner, or transporter.  Some examples are business cultures, national cultures, ethnic cultures, regional cultures, local cultures and then subcultures.  Businesses interact with these cultures every day. Nevertheless, these cultural interactions are far more complex in an emergency or disaster.

Consider a Chinese company that has a U.S. citizen as the country manager for their U.S. operations.  Many people assume this will provide sufficient understanding of the U.S. culture.  In fact, that may be true for normal operating conditions when the public isn’t affected by an emergency. However, that assumption is no longer true when things deviate from the standard.

Imagine restoring normalcy to a displaced Quaker community after a pipeline rupture that caused fires and a toxic H2S release. Contrast that with an undocumented immigrant community in a city, a casino resort on a Native American reservation or a massive subdivision of expensive homes.  Each one of those has its own culture and requires different considerations and types of assistance.

Three Ways to Mitigate Mazeway Disintegration

  1. Go Beyond Cookie Cutter Correctness. The political correctness mindset limits and hinders the effectiveness of response efforts. This makes a thorough discussion of risks, solid vulnerability analysis, and subsequent preparation essential. Even the most brand-aware organization will be rendered ineffective if they fail to identify crisis management cultural issues in their response.
  2. Know the Mazeways of Affected Populations. Determine the characteristics of the cultures, inside the fence and out. Do this now before you need it in a crisis. If you don’t know their cultural context before it is disrupted, you can’t effectively mitigate mazeway disintegration after the disaster. If you wait until impacted populations demonstrate crisis management cultural issues, it may be too late. In fact, after the disaster, affected communities may not be able to articulate what they need to restore normalcy.
  3. Get Independent Assessment. Don’t pawn this off on an overworked or unprepared employee. While it’s not feasible to have cultural anthropologists conduct exhaustive studies of every population, there are cost-effective options. In most cases, you can use professionals who understand this dynamic. They should identify those special populations and describe their needs using accurate descriptors. If they uncover difficult issues, you can address them at that time. Also, prepare the cultural assessment in a context that won’t be misconstrued. This will more effectively mitigate mazeway disintegration in a crisis.

The public now expects companies to avoid culturally insensitive collateral damage. This approach demonstrates your company’s interest in your stakeholders and guards against charges of corporate callousness. Preparing to mitigate mazeway disintegration doesn’t need to be a huge, resource intensive program. Modest programs utilizing knowledgeable resources can identify crisis management cultural issues and develop plans to address them. By following these steps, you can mitigate mazeway disintegration risks and ensure a much more positive resolution.

Issue Fatigue – Corporate Crisis Stress

Issue Fatigue – Corporate Crisis Stress

Issue fatigue is another hot topic. The actions of the political extremes are increasingly alienating the majority between them. The news media and social media cannot constrain their obsessive coverage. Millions of bots are exacerbating it. People are exhausted! Concurrently, the core groups in the extremes are enthusiastically whipping up hateful sentiment hoping to gain the advantage. The frightening corporate equivalent of issue fatigue contributes greatly to corporate crisis stress. It can decimate your best plans to defend your company.

This political narrative helps illustrate the dynamics in a corporate crisis, but don’t take the comparison too far. Both have leaders and operatives from opposing camps and likely many camps. Both have experienced professionals who strongly believe it their point of view. (If your business doesn’t have professional support or loyal employees, you have even bigger problems.) However, unlike politics, a business loses if it alienates its customers, suppliers, investors or myriad of other stakeholders.

Issue Fatigue

A sustained crisis can wear down the people your company needs most, your leaders and responders. Your opponents may have true believers and potentially an endless stream of new advocates and investigators against you, but there’s a limit to how much your people can process and handle. Unlike opposition that could come from any direction and doesn’t always have to be reliable, a company’s response must be consistent and accurate. With all this stress and issue fatigue, your people may succumb to corporate crisis stress. So, what do you do?

Presidential stress

Issue fatigue and crisis stress take their toll on everyone. You can see this in the way virtually every President of the United States has noticeably aged during the term in office. They simply cannot fully compartmentalize and control the enormous weight of responsibility and the frequent barrage of one crisis after another. The combination of mental, emotional and physical stresses will wear anyone down, as well as threaten performance.

Crisis Responders

Some people seem to excel and even thrive in adverse, stressful circumstances. I used to stoically joke that it was the adrenaline. That wasn’t completely accurate, but challenging situations did allow me to use quick wits, a wealth of experience and total determination to solve major problems. However, over the years I’ve learned the wisdom of objectively and dispassionately considering what to do in a crisis. Often, it can provide better results than just bluster and around the clock enthusiasm.

Of course, members of the team need to show that managing the crisis is their top priority and they’ll do whatever it takes. It’s important to demonstrate your commitment, but passion can also obscure other important information. Being solely in the moment leads to limited thinking and significant crisis stress. For a brief time, emergency responders can handle the stress of a crisis. However, even basic issues such as sleep deprivation, poor diet and lack of exercise soon take a toll.

15 Corporate Crisis Stress Magnifiers

Some of the actions that may contribute to corporate crisis stress are:

  1. You learn about the crisis and realize that the business, people, financials and reputation are at risk.
  2. The need to drop or cancel every activity that had been most important to you, just moments before.
  3. You mobilize people and resources to respond. This usually means yanking them away from what was important to them.
  4. Grab plans, people and supplies and usually go to a new location.
  5. You do your best to let family, friends, staff, management and stakeholders know what you can when you can. However, there are severe restrictions and managing the crisis is the priority.
  6. You start getting inquiries, unsolicited advice and pressure from dozens of internal and external sources. This includes the media, government officials and even the neighbor you’ve been ignoring.
  7. To maintain control, you may keep information close only to find that reporters are airing reports from uninformed sources.
  8. Reporters are entering secure areas. They are interviewing untrained employees.
  9. You spar with local, state and federal officials to see who controls your crisis at your facility.
  10. You haven’t had a crisis drill for 18 months. The plan hasn’t been updated since the downsizing. Several key responsibilities are missing.
  11. The conference room hasn’t been refreshed in years. Computer equipment is outdated. Office supplies, food, refreshments and toilet paper supplies are inadequate.
  12. You have people working overnight, through the weekend and from out of town. There aren’t rooms or showers available for them.
  13. There’s always something that requires your attention, so you haven’t slept more than 15 minutes straight for days.
  14. The board wants hourly updates, twice daily reports and is second-guessing your actions.
  15. Your family needs you at the hospital.
Woman show effects of corporate crisis stress and issue fatigue

Corporate Crisis Stress

More Stress

The list can go on and on, but this should give you a feel for the circumstances and pressures many emergency response and crisis communications managers encounter in one crisis after another. Imagine combining these with issue fatigue, sustained stress and separation from stabilizing influences such as family, friends and routines. There is a real risk that performance and health will suffer. The trick is handling corporate crisis stress in a way that doesn’t exacerbate mistakes.

Of course, no one is suggesting that we don’t handle a crisis. It requires an effective response. You want to have your best people handling it. Otherwise, the damage may be even greater. We just want to prepare and respond in a way that ensures the best results for the business and the least harm to people and the environment. In fact, if done right, it might be self-actualizing for the participants.

3 Ways to Reduce Issue Fatigue and Corporate Crisis Stress

Here are three things you can do to reduce corporate crisis stress. Importantly, they also significantly increase your prospects for successfully resolving the crisis.

  1. The best way to reduce crisis stress and improve performance is through planning and training before the crisis occurs. This planning will decide who is responsible, ensures you have the people and resources you will need, and clearly defines a chain of command. Through exercises, drills and training, the plans are tested. Also, people become proficient in their roles and you make the adjustments needed to improve performance. This is a good time to confirm logistical support and preapprove statements and strategies. Otherwise, they will cause delays during a crisis. The forethought and confidence you gain will dramatically reduce corporate crisis stress.
  2. Stay focused on the problem and not on personal considerations. Recognize that crises often sew political discord. Try to steer clear of political jockeying. At the same time, be open to good ideas and use your knowledge and common sense to advance the best solutions.  Ultimately, use your knowledge and training to be professionally deliberate.
  3. Use experienced consultants to give you an outside perspective and the benefit of their knowledge from other crisis situations. Their slight bit of detachment from the crisis may give you the perspective and assistance your internally focused team can miss. Consultants allow you to bounce ideas off an expert in real time. Also, many employees fear the repercussions from a crisis and that clouds their judgment. Experts don’t have the same concern.

Words to Remember

A career international Crisis Manager once recounted the words his first boss told him.  “Don’t get stressed over politics or people.  Assume you’re going to be fired regardless of how things turn out.  Be the best professionally and always do the right thing.  You can defend doing the right thing forever into the future but not so lapses in common sense or professionalism.”

Global Operations Insight

Global Operations Insight

How can we integrate our global operations with local cultures and locations? As challenges multiply across international markets, new global operations insight is needed. This guest briefing by Nicholas Krohley, Ph.D. provides extensive and valuable insight. Dr. Krohley is a globally respected social scientist, with deep practical experience working with interests such as the military and energy industries to integrate leaders into new cultural environments.

Global Operations Insights

Global Operations Insights

 A new perspective for the front lines of global operations…

It’s a jungle out there – sometimes literally. From the creeks of the Niger Delta to the deserts of southern Iraq, to Philippine archipelago, international operations are growing more and more challenging. Geopolitical turmoil and regulatory changes are both adding big-picture complexity. Yet the most critical factor is the human element of business and the ways that local realities are intruding evermore into our day-to-day operations.

A confluence of factors creates complex challenges:

  • Workforce nationalization mandates are bringing the nuances and complexities of local society into the workplace.
  • Increasingly robust social and environmental regulations invite heightened scrutiny from local and international stakeholders.
  • Empowered community activism and aggressive actions by local governments draw us into a web of complex (and often intractable) local social and political disputes.
  • Simmering conflicts in and around our areas of operation pose a host of risk- and security-related threats.

As a result, the fundamental operational management strategies and personnel models of many global organizations are being upended. 

Life in the Bubble

For decades, industry leaders in sectors ranging from resource extraction, to project management, to finance and consulting have cultivated an expat-led management strategy. We developed the technical skills of a cadre of expatriate managers and operational leaders and then rotated them among various geographies.

Global operations insights

This was meant to create an international vitality within our organizations. A career progression that included leadership roles in a diverse set of countries would contribute to the growth of the individual, and the dynamism of the organization as a whole. This, in turn, was central to our identities as “global” multinational organizations.

In reality, this approach was effective in proportion to our ability to create “expat bubbles” from one country to the next. As a manager or operational leader, we might move from the United States to Colombia, and then on to the United Arab Emirates, and then to Vietnam. In theory, this progression imbued a range of cross-cultural experiences that would enhance our professional development. In practice, however, we typically moved from one expat bubble to another, seeing the same sorts of faces in the same sorts of housing compounds, and sharing drinks at the same sorts of social events. The scenery changed, but the fundamental “expat experience” was broadly consistent. Moreover, our workplace culture was deliberately directed toward the establishment and maintenance of global “best practice”, which we would apply from country-to-country as our careers took us around the globe. Our core technical skills enabled us to do our jobs, while the realities of our operational management strategy (where the leadership team was staffed predominantly by fellow expats and the lower echelons of the workforce were often drawn from low-cost labor markets outside of the host country) insulated us from local reality.

Adapting to the “New Normal”

This model is no longer tenable. Around the world, the expat bubbles are bursting. Local content mandates force us to hire and source locally. Community activism and external oversight bodies have achieved broad visibility on our inner workings. National governments are increasingly assertive in contract negotiations and associated impositions and may hold us up as foreign scapegoats for (or merely a convenient distraction from) a broad range of locally-rooted challenges.

How do we adapt to this new reality? On the one hand, we must maintain global standards. This is critical to our organizational cultures, and essential to our maintenance of performance, ethical, and safety benchmarks. On the other hand, however, we must also come to terms with where, when, and how to adjust to our local environment. An apparent contradiction results: we have to be a coherent global entity that is, simultaneously, a local organization in each of the markets where we operate. What does this look like for an organization that has its headquarters in New York, and operations in Nigeria, Nicaragua, and the Netherlands?

global operations insights

From leadership and personnel development to HR administration, to security and crisis management, there are core values and standards to uphold. Yet “the right approach” to implementing the attendant policies and procedures will vary in subtle yet enormously significant ways from Mongolia, to Mexico, to Mauritania. These subtleties may well decide the balance between success and failure, or profit and loss – yet few organizations have recognized this dynamic, and developed a systematic approach to adapt accordingly.

How do we do this? How do I, as a country manager, operational leader, HR professional, security officer, or crisis manager determine what matters about where I work, and what it all means when I am making a business decision? How should local dynamics influence my leadership style, my security posture, my recruiting efforts, and my crisis communications strategy? How do I navigate my immediate environs, and make practical sense of the complex and dynamic social, economic, political, and cultural currents that are swirling around my operation?

Who Can Help Us?

There are resources that we can draw upon. The media offers an abundance of information. But how do we vet our sources (particularly in unfamiliar cultural environments, where we may not appreciate the perspectives and/or biases that are embedded in reporting)? Moreover, how do we zero in on the issues that are operationally relevant, amidst the overwhelming volume of reporting on any given geography? Unless we know exactly where to focus, “information overload” ensues almost immediately.

Political risk and advisory firms offer more focused, industry-specific reporting. Yet their focus is at a macro-level, with geopolitics and regulation as key issues of concern. To what extent can a country report, or a regularly-issued email update from an analyst in Washington, London, or Dubai, enable us to navigate the “here and now” of specific concerns as we lead operations in Port-au-Prince or Port Harcourt? What can a desk-based Libya expert in Paris offer to an operational manager working in the desert south of Sirte about what is happening around me at my worksite? Certainly, there is an abundance of contextual information that will be helpful to know. But this is only a starting point, not a destination. How do we generate the actionable, targeted insights that we need to take informed actions on a daily basis?

Learning from the Best…

Fortunately, there is a high-profile, exceptionally well-resourced, industry-leading behemoth that has taken on precisely this challenge, and whose (very, very public) successes and failures offer a wealth of relevant insights. An organization that has a clearly established and widely revered set of global standards, and an exceptionally well-developed internal regimen for the honing of professional and technical skills – but that found itself unable to function effectively in its most important overseas markets, due to an inability to come to terms with local realities.

Any veterans reading this message may well have guessed the organization in question: the United States Army.

Faced with faltering campaigns in Iraq and Afghanistan, the US Army came to appreciate the critical importance of local understanding. Of the need to dig into the details of its operating environment – the “human terrain” in military parlance – and understand how local social, economic, political, and cultural realities were tipping the balance from success to failure. The fundamental intent was not to soften the Army’s approach in pursuit of “hearts and minds”, but to equip operational units with the depth of local insight that would enable them to adapt and succeed on the ground.

Having recognized the need for this sort of insight, Army leadership confronted an organizational dilemma: who is going to do this, and how? Put simply, the collection, analysis, and operationalization of this sort of contextual insight fell outside of the core job categories within the Army. Intelligence officers were focused on the enemy. Civil Affairs was focused on the rehabilitation of infrastructure and engagement with local officials. Company- and Battalion-level commanders were already working 18-hour days to manage the day-to-day operational flow of their deployments. The front line leaders who were able to tackle these questions “in their spare time” were making an enormous difference on the battlefield, but this was clearly not a viable operating model.

In need of a rapid and scalable solution, the Army chose to bring in outside expertise. In effect, the executive leadership team outsourced the problem to consultants. The resulting program, known as the Human Terrain System (with which I served from 2007 to 2011), became the flagship effort of the US Army in resolving these challenges. Central to the utility of these teams were the skill sets of civilian social scientists, who brought academic skills to bear in the navigation of local realities.

At its peak, the Human Terrain System was a $150,000,000-per-year operation, with upwards of fifty small teams embedded with operational military units across Afghanistan and Iraq. The program also maintained a sizable rear echelon for research support and internal administration, and it developed a proprietary technological platform for the organization and visualization of research.

The performance of the Human Terrain System’s elite teams fully validated the utility of the concept, delivering critical insights from unique perspectives, and shaping the design and execution of operations on the ground.

Yet, in the final account, the program delivered an unsustainably poor return on investment – prompting its shuttering after seven years of operations, and the delegation of its analytical and operational responsibilities to a range of “in-house” military and intelligence entities.

The Key Lessons Learned

A host of lessons have been learned within military and intelligence circles from the rise and fall of the Human Terrain System, many of which are captured here, and here. Yet there is a clear and concise list of lessons that are applicable to our current predicament:

  • We have the in-house talent to take on this challenge. We do not need to embed legions of expensive experts within our operation. The Human Terrain System tried this, and two things became rapidly apparent: First, a host of challenges arise when we try to embed significant numbers of outsiders into our operations, which inhibit their ability to add the right value at the right time. Second, any large, high caliber organization will have ample intellectual firepower within its workforce to take on this sort of work. Reaching the desired end-state does not require long-term engagement with teams of external subject matter experts. Instead, the challenge is to harness the talents of our current personnel, establishing processes and procedures through which we can analyze these issues ourselves.

 

  • Technology won’t solve this for us. The tech solution pursued by the Human Terrain System was a staggeringly expensive failure, consuming up to 1/3 of the program’s budget and ultimately delivering nothing of practical value. Technology can solve all sorts of problems in business, and it’s appealing to think that there might be a magic button we can press, unleashing “artificial intelligence” and “algorithms” to make sense of the world around us. The US Army spent tens of millions of dollars to that end – with virtually nothing to show for it.

 

  • Investing in the front line personnel pays off in myriad subtle waysand neglecting us can wreak havoc. The US Army, like many of our organizations, dedicates significant time and resources in strategic decision-making processes at the executive level. Questions of what should we do, and how should we do it, are well resourced and debated. Within our organizations, the decision to enter a particular market will involve extensive (and expensive) consultations with lawyers, lobbyists, risk analysts, surveyors, and accountants. Yet, once the decision is made to “go in”, what do we do to prepare the men and women who will be leading the operation on the ground? This dynamic was a key factor in the challenges faced by the US Army in Iraq and Afghanistan, where front line units were typically provided only the most basic information about the areas to which they were deploying. Similarly, this is a potentially crippling weakness for large global organizations in the private sector. If vital practical and contextual insights about the local operating environment are not conveyed to front-line personnel, the potential for disaster is unlimited. This was recognized as a problem within the military, leading to the notion of the “strategic corporal”. In a positive sense, this term captured the idea that junior enlisted soldiers had the potential to make strategically significant contributions to our campaign, by doing the right thing for the right reasons. More commonly, however, the term came to be used in the negative sense, with the realization that a mistake or misdeed at the lowest levels of the organizational hierarchy could cause ripples that would cascade into a strategic-level catastrophe.

Taking our discussion back to the corporate world of international operations, there is an obvious need to convey factual knowledge to the men and women who lead our operations, and for global organizations to provide a baseline of focused, structured information on the societies in which we work. This is an essential first step as we adapt to the challenges outlined above. Yet we must appreciate that these environments are dynamic and that operational success requires a level of specificity that cannot be fully captured in a report or a briefing. To reach the needed level of granularity, we also require a defined process and method for home-based and in-country personnel to come to terms with local realities. We need to equip our personnel with skill sets to make sense of these shifting cultural, socioeconomic and political paradigms, and to empower them with a mandate that recognizes the importance of this endeavor.

The Way Ahead…

Once we embark on this path, new opportunities present themselves for integrated action. How can our local recruiting strategy support our security and community engagement efforts? How can we tap the knowledge and access of our local workforce for targeted insights into key social, economic, or political dynamics? How can the refinement of our leadership and personnel management strategies optimize the performance of our local workforce, and enable compliance with rising workforce nationalization mandates? How do we integrate detailed local insights into the organization, so that we can pre-empt or avoid potential crises? Failing that, how can we leverage our local understanding to respond to an incident with the right messaging and actions at the right time? More broadly, how can our executive leadership strike the balance between global standards and local norms across our international operations?

There is no prospect of the international operating environment becoming less complicated. There are no lights of simplicity beaming from the end of a proverbial tunnel. There is no emerging technology platform that will sort all this out for us. On the contrary, we will require ever increasing levels of awareness and understanding of the world around us and flexibility in adaptation to events outside of our control. This will demand the refinement of existing skill sets, and development of new ones as well.  The social sciences will have much to offer, but social scientists themselves will have only a light-touch advisory role to play. The companies that are able to harness and leverage that expertise and instill these capabilities – and the mindset that underpins them – into their own organizational DNA, will be the ones best positioned to succeed in the ever-challenging “new normal” of international operations.

 

Dr. Nicholas Krohley

Founder, FrontLine Advisory LLP

nkrohley@frontlineadvisory.com

www.frontlineadvisory.com

@nkrohley

Fall Crisis Preparedness Advantage

Fall Crisis Preparedness Advantage

For many businesses, Autumn is the time when you press forward to accomplish everything you’ve missed or, better, give yourself an advantage next year. Most Americans call the season Fall, which evokes another meaning of the word that is closer to failure or collapse. None of us want to fail or even think about a great Humpty Dumpty fall, That’s why it’s wise to occasionally consider and prepare for major corporate issues. To help, let’s take a few minutes to walk through giving yourself a Fall crisis preparedness advantage.

Fall crisis preparedness advantage

As with a fall, a crisis is usually rather sudden, unexpected and difficult to correct while it’s happening. If you don’t want to crack open like an egg, it helps to prepare, practice ways to minimize damage and respond as the situation demands. Ultimately, those efforts will ensure a more thoughtful, coordinated and effective response; a crisis preparedness advantage. The need is evident from the host of business, professional, societal and environmental calamities suffered over the past year. Do yourself a favor and press forward with a Fall crisis preparedness program, before it’s your downfall.

Why bother with Fall crisis preparedness?

The operations functions of most organizations recognize the risks from an operational emergency. They’ve had enough exposure to past emergencies to understand the great financial and operational cost if the emergency is not effectively addressed. That why they require serious attention to emergency preparedness, including planning and training. Sadly, less attention is given to preparing for corporate crises, even though they carry the greatest risk to organizational survival. That’s why Fall crisis preparedness planning and drills are so important. If not now, when?.  No crisis suffers fools with a corporate death-wish.

Last year, we wrote that “2017 ‘gave’” the energy and chemical industries, pipelines, railroads, and other businesses the following:

  • Workplace violence with fatalities
  • Employee theft and embezzlement
  • Sexual Assault and harassment
  • Explosions, fires, and spills
  • Hurricanes, floods, and earthquakes
  • Kidnapping of employees
  • Internal and external industrial espionage
  • Extortion of compromised employees
  • Executive misconduct
  • War, civil unrest and insurrection where we do business

 Do you see any similarities this year? Have you considered whether it might get worse next year and hit your business directly? These things happen more often than any of us want to admit. They’re also happening with greater frequency and severity.   The only real questions are when and how much. In other words, will you be next and what will be the uncontrolled damage to your organization.

crisis

Avoidance isn’t the answer

Few would have expected Houston to encounter three 500-year floods in as many years or that the latest would be a 1,000-year flood. This created corporate challenges for some companies that went well beyond the operational response. Many others would have missed the global attention spawned by the Me-Too movement. Obviously, it would have been better to resolve these issues before they became a crisis for many. However, most organizations will do well to prepare to identify and address such issues effectively, once they are known.

Don’t beat yourself up if you haven’t already prepared. It has been human nature throughout history to discount risks and expect to overcome perils. The ancient Greeks recognized the risk of arrogance and excessive pride, by making hubris the common failing in most Greek tragedies. Even so, if you’re not already in a crisis, there’s still time to initiate Fall crisis preparedness. Anything you do to overcome inertia will help you achieve a crisis preparedness advantage.

The odds of a crisis confronting a company are infinitely greater than the odds of winning the lottery. So, it’s hubris to feel immune to a crisis and/or intentionally dismiss the importance of preparation for a worst-case scenario.  The rational investment is to dedicate the time and resources needed to prepare for and prevent a crisis. Doing that could easily save your company far more than you could ever win in a lottery.

Operational vs. Corporate/Reputational

The big question is whether you will be prepared when a crisis strikes. Most companies have emergency management programs in place to address the inherent risks in their physical operations. These are important and are often institutionalized much like safety and regulatory compliance have been ingrained in their processes and are a component of company culture. Testing those programs regularly and subjecting them to external assessments creates a good and solid foundation for the basic components of Crisis Preparedness that include Emergency Management, Communications, Corporate Security and Emergency Response.

emergency management

The problem comes when it’s something unanticipated or bigger than the company’s routine operational capabilities; in other words, a crisis needing a crisis management plan, crisis management team, crisis management policy, procedure, and processes, all integrated with crisis communications and public affairs. If you have these capabilities working in full coordination, you are doing well and should have an effective and comprehensive crisis preparedness program.  If you include annual training through organized exercises, you will have a crisis preparedness advantage.

Many of the examples listed above constitute a bigger corporate crisis that could seriously damage a company’s reputation and its market value. These bigger and more complex situations require elevated crisis preparedness capabilities with crisis management plans involving executive management and more sophisticated crisis communications capabilities. Here, dispassionate wisdom and experience can make all the difference.

Crisis preparedness advantage

Crisis preparedness requires thoughtful planning and the discipline to follow through. It’s what separates great companies with staying power from those with short-term focus who won’t make it through the next downturn. Even when companies have strong, well-established crisis preparedness programs, they can easily create new vulnerabilities. Some examples are when 1) they rotate inexperienced people through supervisory responsibility for crisis management, 2) crisis management team members change without experienced replacements or trained replacements, or 3) the rate of those changes exceed the frequency of the team’s group practices.

Without strong coaching and support, an inexperienced crisis management or crisis communications professional can unintentionally expose a company to extraordinary risks. These are not only career limiting for the professional, but also for the executives overseeing the function.  Unfortunately, it may take a major accident, catastrophic event or highly visible issue for these mistakes to become apparent.

Institutional knowledge and culture are key to successful and repeatable response management. If you want to avoid these issues, then at the very minimum, arm those employees or leaders with an experienced consultant and mentor to guide them through the minefields of the risks, corporate exposures, and liabilities.

To lose what you already have in crisis preparedness and organizational resilience is a terribly expensive waste.  Readiness and preparedness for a crisis are part of a larger recipe for success.  Since few investors will tolerate a preventable loss of share value, basic measures of crisis preparedness and capability maintained to specific standards are core expectations of owners and stockholders.  Make the call and get ahead of this, while there’s still time.

Crisis Management Budget

Crisis Management Budget

Your budget is due! What do you do? If you manage operations, EHS, security or crisis management, you know you need a crisis management budget. Corporate communications also needs a crisis management budget, but you may call it crisis communications. Oh sure, you’re also budgeting for other stuff, but this is different. If you don’t budget for crisis management, you’re leaving your future to chance. Clearly, you need to regularly update and test your plans. You also need to train your people and ensure stakeholders are happy with your responses.

crisis management budget

The question is how you do this when there’s so much already on your plate. You’re being pulled in a dozen different directions and haven’t been able to do all that’s needed. Worse yet, you need reliable numbers for activities you may only touch every year or two. What if you don’t know what to do or how to do it? Nonetheless, you must figure it out and prepare. You’re the functional expert and failure is not an option. The stakes are simply too high to ignore this, but who has the time.

Budget Imperative

The business world is driven by priorities and urgency. Yet, the possibility of a future crisis may not be urgent enough to be a priority. Fortunately, the annual budget process provides the sense of urgency we need. Since there will likely be some sort of crisis next year, companies need to ensure they have resources for the possibility. So, use the budget as a way to ensure you prepare.

Of course, you will need to budget for ongoing work and programs. For these items, past expenses can provide helpful guidance, even in zero-based budgeting. The problem comes with sporadic items. If you haven’t updated, trained or practiced your crisis plan in years, you’re already behind the curve. This frightening situation only gets worse if you don’t have time to work through the numbers and strategy.

crisis management budget

In most situations, crisis drills and plan updates should be conducted annually. If you haven’t prepared and trained, correct this lapse as soon as possible. Otherwise, you could be caught flat-footed in a major crisis. The simplest solution is to include a crisis management budget in your overall budget request. Budget planning season is the time to ensure you are protected against risks that could seriously damage your company.

Crisis Management Budget Needs

This is the annual opportunity to ensure crisis preparedness through your crisis management budget. Start by recognizing that you need to budget for review and update of your crisis plan. Then, outline a budget to train your employees and conduct exercises or drills. This will help you test your program and employees’ abilities. Depending on your situation this can be elaborate or basic. Now you need to provide reliable cost estimates for your budget.

Unfortunately, this hits right when the summer vacations end and children return to school. Concurrently, management is gearing up for a host of major activities in the fall. So, budget preparation is often an afterthought in a world with more to do than time to do it. However, if you hope to have an effective crisis management, training or communication program, don’t miss this opportunity.

So how do you get reliable numbers? It’s hard to budget if you haven’t decided between vendors or whether it would be more efficient to handle this in-house. Nevertheless, there’s a safe solution that will restore sanity to your life and ensure you can make your budget submission work. Having come from the corporate side, we’re going to share this solution despite it causing us more work. Of course, we get our income from work, so we see the beneficial connection.

Crisis management budget

The Budgeting Solution – Ask Consultants

Identify one or two consultants that can do the work you need. For crisis management, this could be a crisis management firm, but if they don’t have integrated communications capabilities, you may need to broaden the outreach. You could use other firms for other specialties, but today we are focused on your crisis management budget. Simply contact them to confirm their relevance and let them know you are planning for next year’s crisis management budget. Then ask them for a budget proposal to provide the necessary work for you.

This should lead to some discussion of your plan elements, as well as training, drill and exercise needs. If you want a stripped-down, fundamental program they should be able to give you an estimate for its parts. For instance, they could say a table top drill for 10 people with a post drill critique will cost $X, while an onsite exercise will be $XX to $XXX. However, if you have significant exposure and gaps in your ability to respond, you may want a signed NDA so you can share details. Paying a modest fee for a more in-depth assessment and the proposal may yield a more comprehensive program later.

If the consultant agrees, you will have the information you need. Conversely, you will be aware that there are limits to what you can expect from them if the consultant declines. Of course, receiving more than one proposal will teach you more about the range of options and capabilities. You can then decide to select one or possibly combine their proposals. Whatever approach you take, the proposal(s) you receive from the consultant(s) should give you the information you need to submit your crisis management budget.

Result

Of course, you could decide to handle the work next year with your own people. If that costs less than the consultant’s proposal, you can feel satisfied that you are saving the company money. Even if you expect to handle this in-house, you should consider initiating vendor approval for the consultants. Here’s why:

  • It recognizes the service they provided.
  • Vendor approval can be a lengthy process and someday you may need help without delay.
  • If you do decide to work with them next year, you can start planning now.
  • If you start now, you’ll have a program waiting for you next year.
  • Tell the consultant about your plans, before they go through vendor approval. Since some companies’ vendor approval requirements can be costly, this will reduce misunderstandings. The consultant may be willing to take the risk but should be given the opportunity to objectively weigh the cost-benefit.

With this approach, a consultant will have an opportunity to build a relationship with your company and you will have more accurate budget plans. This doesn’t always work, but if you are honest and transparent with the consultant, it’s a solution for you and an opportunity for them.

Crisis Issues – Beyond Emergency Response

Crisis Issues – Beyond Emergency Response

Don’t worry! We have a great emergency response team. They follow all the best practices and train annually. They can handle any emergency response.” That’s a great start for any company. Certainly, it will serve you well in an operational emergency. Also, they can apply many of their skills in other areas. However, this doesn’t address the different perspective needed for corporate concerns and crisis issues. To illustrate this, you’ll see major crisis issues to watch later in this post.

crisis issues emergency response

Emergency Response vs. Crisis Management

Many companies plan and practice only emergency response procedures because they are more comfortable with the structured approach and focus on operating issues. They also like that the federal government has complementary emergency response protocols.  Of course, emergency responders are very important in most operating circumstances. However, corporate crisis situations require perspectives that go beyond emergency response.

What’s missing is the host of corporate concerns that are also covered in the broader field of crisis management. If you have an existing emergency response program and need a crisis management capability, the simple solution is to build an overlaying crisis management team and supporting crisis management plan at the corporate level. This will ensure that neither team or approach confuses the focus of the other.

Likewise, crisis management teams support emergency response teams and other tactical groups while providing direction and voice for the entire enterprise. In this hierarchical structure, the crisis management organization encompasses all the resiliency efforts such as emergency response, business continuity, and security.

Conversely, don’t expect emergency response teams to handle crisis issues. Corporate concerns can simply be too complex for the structure of emergency response plans and compartmentalized teams.

Hopefully, your company already has a crisis management plan and practices it. If not, act now, since the middle of a crisis is usually too late to plan and practice your team’s roles and responsibilities.

crisis issues emergency response

10 Crisis Issues

Crisis management can work hand-in-glove with your emergency management team and plan while addressing other enormously important issues. Here are 10 major crisis issues that warrant real thought, preparation and integrated crisis management:

Bankruptcy

This can happen to any company. Consider two companies that had been among the 10 largest in the United States. Texaco declared bankruptcy so it could appeal an unexpected $13 billion judgment for tortious interference. Enron went from perennially most innovative company and darling of Wall Street to a global pariah in a matter of weeks. The plans, strategies, and leadership at Texaco ensured the company survived for many years after the bankruptcy. Enron did not enjoy a similar fate. Initially, there was too much executive focus on personal survival and shocked denial to stem the massive capital collapse. These situations resulted from several of the next examples.

Litigation

This was the proximate cause of the Texaco bankruptcy and virtually ubiquitous around the Enron collapse. Litigation is often the cause of an unanticipated crisis. Unfortunately, you may appear to be in complete control, until you aren’t. Litigation requires extraordinary attention to any communication and coordination with legal representation. Often, communication with stakeholders helps with litigation, such as through amicus curiae

Hostile takeovers/activist investors

Activist investors are increasingly confronting companies and threatening change-of-control. For instance, when Texaco was weakened by its bankruptcy, Carl Icahn initiated a takeover. The crisis response included passage of the Delaware corporate consolidations bill that slowed more aggressive tactics. This gave the company time to restructure and successfully respond.

Third party incidents

One company’s emergency may become a crisis for other companies in its industry. An oil spill in Alaska resulted in stringent shipping requirements on the entire petroleum industry and a passenger train collision in California resulted in multi-billion-dollar positive train control requirements on freight railroads. Public opinion and crisis issues can drive punitive legislative responses.

Corporate malfeasance/ government investigations

If an employee bribes a foreign official, the CEO may go to jail under the Foreign Corrupt Practices Act. In another case, the government may prosecute your company if you falsify billing. Both will seriously damage reputations.

Expropriations/ abrogation of contracts/ sanctions

You may be doing everything right, but a sovereign government can act for its own reasons. It may want your assets, refuse to pay for services under its contract or put you in the middle of an international dispute. These actions can shake markets’ confidence and require massive crisis communication, diplomatic and legal campaigns.

Executive misconduct/sexual assault

Even powerful executives have flaws and they are not always obvious to those who work with them. The preventive programs you put in place and the way you respond can make all the difference. Observers will attribute their actions to your company, whether that’s right or wrong. Carefully managed, it won’t be as bad.

Cyber-attacks/digital assaults

Denial of service, cybersecurity breaches, and other digital attacks have become common. Be sure to handle each case appropriately for its unique circumstances. Federal law actually changed after more than 100 million personal records were hacked at a consumer credit reporting agency. If you want to avoid scandal, be sure to consider and address public interest as a part of each case.

Mass shootings/ terrorism/ acts of war

Nothing is immune to violence. Churches and schools are targets, and new industries are having to scramble to adapt and prepare. Remember when few could imagine someone checking in a hotel, firing hundreds of rounds and killing scores of innocents. The thought, planning, and training to prepare for the unthinkable is now a necessary part of the business.

Targeted reputational attacks

It’s not just politicians and governments that find themselves under attack. Similar methods and sensationalism can be used to persuade communities that a company has violated their trust when that’s not the case.

 

Companies are vulnerable to many of these crisis issues. Waiting for them to happen is too late. Take actions now! Crisis Management and Crisis Communications require capabilities, critical thinking skills, and innovative approaches. With strong planning, preparation and skill you can overcome these issues.

Aspirational Reputation – Institutional Inspiration

Aspirational Reputation – Institutional Inspiration

Businesses have a challenge. Fortunately, they can fix it and increase their competitive advantage at the same time. The solution is to create an aspirational reputation for your company. Simply help your stakeholders believe in the great potential of your business and you will both benefit. Stakeholders who are enthused about your business will help it thrive. Likewise, you can help your stakeholders aspire to greater things by connecting them with the aspirations of your business. You can accomplish all this through authenticity and by creating institutional inspiration.

institutional inspiration

The Challenge

The challenge is that many American’s have lost confidence in a better life for themselves and their children. This has been reflected in recent elections and is felt despite remarkably low unemployment. Interestingly, you can see this in many other parts of the world, as well. This is both a societal problem and a real concern for businesses.

A disaffected population can constrain the economy and increase costs to society. Concurrently, disaffected populations are gravitating toward stronger political leadership to guide and protect them in more difficult times. This phenomenon was seen in the rise of fascism following the disruption of World War I and during the global depression of the 1930s. Significantly, some analysts see a parallel in the current dislocation of the tech revolution and globalization.

With large segments of the population feeling abandoned or even betrayed by elites, the risks to businesses are real. As businesses respond to growing technological and competitive challenges, the gulf between business elites and the have-nots widens. Businesses need to bridge this gap before they become the target.

Why Business Should Act

If the problem is frustration and resignation, the best defense may be to provide opportunities worthy of enthusiasm. Remember, businesses need consumer confidence, an engaged workforce and enthusiastic stakeholders to do well. Fortunately, developing an aspirational reputation builds enthusiasm and makes stakeholders want to associate with your business. The key is to advance institutional inspiration in communication programs and as a priority for both leaders and employees.

aspirational reputation

Most businesses do much better when public sentiment is positive. This is particularly evident when sentiment about an individual business is favorable. When a business encourages its stakeholders to see the business as a positive force that improves conditions, it builds an aspirational reputation. This is a reputation that facilitates a positive outlook and a belief that association with the business makes those associated with it better.

Aspirational Taglines

Advertising can be a very effective tool for capturing the sentiment of an aspirational reputation. Consider these slogans and you should see what we mean:

  • We bring good things to life
  • Be all you can be
  • I think, therefore IBM
  • Just Do It
  • Think Different
  • We Try Harder
  • The Few. The Proud. The Marines.
  • Don’t be Evil

Of course, there’s much more to a company’s reputation than a slogan or tagline, but they help illustrate the concept. In addition, when a company with an aspirational reputation moves on from a specific slogan that can also indicate a shift in focus that will ultimately change the culture and reputation. Some might argue that GE dropping We Bring Good Things to Life coincided with a challenging period of change for the company.

In most cases, great taglines come long after a fundamental philosophy and culture are formulated by leaders and influencers. In some cases, the actual terms are formulated by leaders and influencers.  For instance, Thomas J. Watson first used the slogan Think in 1911 before IBM was formed and three-quarters of a century before the slogan “I think, therefore IBM” was coined.

Impact of Aspirational Reputation

Similarly, Google’s Don’t be evil manifesto was put forward nearly two decades ago by influential employees. This employee engagement is consistent with its more open and participatory style. Of course, some might argue whether the manifesto is controlling, but you can still see how it affects decisions. Interestingly, their willingness to forgo expediency and short-term gains in the early years may have helped deliver long-term success for Google.

These examples reflect the aspirational reputations of world-class companies, but they are important for emerging companies too. Ultimately, finding ways to inspire stakeholders can yield great value. Motivated employees are more productive, and often more innovative and engaged. Investors are more enthusiastic about the company and less likely to create distractions by finding fault. Customers find products more desirable and show greater brand loyalty. Communities welcome those who bring opportunity and elevate the region’s status.

Institutional Inspiration

How do you inspire stakeholders? Often it starts with the leader of the enterprise. Leaders inspire in many ways and the choices often reflect the leader’s individual style. They can inspire through principles, actions, ideas or even art. If that inspiration causes stakeholders to see the potential greatness of the enterprise, then that will begin an aspirational reputation. The leader may be essential to the effort but is rarely able to do it alone.

institutional inspiration aspirational reputation

Even a cursory study of change management demonstrates the importance of coordinated and consistent efforts to promote change. Since communication and motivation are so important, here are ten steps to help establish institutional inspiration:

  1. CEO presentations to all employees and various stakeholder groups, through video, blog, speech or announcement
  2. CEO discussions with executives to reinforce messages and secure buy-in
  3. Management team presentations to their reports and group meetings
  4. Town hall meetings
  5. Stories in internal publications, video or intranet
  6. Messaging in public speeches, analyst and community meetings
  7. Incorporate messages in web and promotional materials
  8. Consider updating boilerplate, vision and values
  9. Awards and recognition for those who demonstrate the inspirational change
  10. Incorporate in advertising and branding

Comprehensive Aspirational Reputation Program

Reinforcing the message across several channels is important in creating institutional inspiration, which will lead to an aspirational reputation. Furthermore, to resonate with audiences and seem authentic, you should go further than repetition. For instance, appeal to different styles by incorporating several genres into your communication programs. Corporate communications, advertising, and marketing can be important partners in these efforts.

Imagine the president of your company speaking from the heart about your organization’s potential for greatness and then positively reinforcing this with people throughout the enterprise. Now add uplifting theme music such as Classical Gas and people will start associating your positive messages and the uplifting music. Now create visual design and carefully researched slogans that reinforce culturally authentic messaging. The result could be a truly aspirational reputation that makes stakeholders want to be associated with your company.

Authenticity Yields Authentic Reputation

Authenticity Yields Authentic Reputation

Authenticity allows us to like what we like and dismiss what we don’t, without value judgments. It can generate enormous brand loyalty. It has enriched social media influencers. For some, it’s the single most influential factor in determining stakeholder support. Authenticity is that secret sauce that conveys the consistent image that people rely upon. When combined with the real qualities that people attribute to businesses, they create the very powerful force of an authentic reputation.

To illustrate these concepts, we’ve created a story about authentic reputation and its importance to business success. When we finish we will offer five keys to protecting authenticity. We will use two fictional companies and their leaders. Both companies had great brands and their success was envied by many. They each cultivated authentic reputations that ensured strong stakeholder support. The companies, Real Products and Unlimited Energy, were at the threshold of global success.

authenticity authentic reputation

The Calculating Model

Real Products was a closely held company that had methodically built itself from a cleaning contractor to a major conglomerate. The CEO of Real Products was cold and calculating. He brilliantly used data analytics to his advantage. While fully capable of winning in direct competition, he often discretely maneuvered to co-opt the competition.

He used elaborate structures to win over stakeholders. While customers, employees, and communities might not get the best deal from Real Products, it was much better than if they crossed him. He wanted to effectively control his business lines globally. Of course, he cared about money, but power and control were stronger drivers. He had an authentic reputation for winning through careful analysis and calculation. Investors and other stakeholders supported him, so they would not lose to Real Products.

The Bold Model

Unlimited Energy had been the most popular brand in the world with operations in every country. For generations, it was the biggest, best and most widely admired corporation, but over time it faltered. Activist investors gained control and brought in new management.

For this job, Unlimited Energy chose a bold, brash and supremely confident CEO. He had radically transformed several other companies. While a couple of those companies had to be broken up and sold, all his ventures enriched his investors. This new CEO promised to restore Unlimited Energy to global dominance and make all investors wealthy in the process.

Predictably, Unlimited Energy’s reputation morphed into one closer to the supreme self-confidence of their CEO. Investors flocked to Unlimited Energy’s can do, take no prisoners attitude. Unlimited Energy gained the authentic reputation as the company that would always come out on top. It wasn’t enough just to win; Unlimited Energy must dominate.

authentic reputation

The Strategy

Real Products and Unlimited Energy were the most effective competitors in the markets that were open to them. They were first or second in every market. When one of them wasn’t in a market, the other was usually twice as big as the next competitor.

The CEO of Unlimited Energy realized that together they could easily pick off the more profitable parts of their smaller competitors. He decided they should talk rather than fight head-to-head and squeeze each other’s margins. A preliminary discussion between the two CEOs was set while they were both at Davos.

To simplify the story let’s assume they weren’t covered by the Sherman Antitrust Act or other regulations. The activist investors were all crowing about how Unlimited Energy would dominate even these preliminary talks.

The Collaboration

When they met, the Real Products CEO was true to his nature. He had analyzed every aspect of the possibilities and developed a comprehensive plan for absorbing 60% of their competitors. The remaining 40% was consolidated under several allied businesses, to soften opposition.

The plan doubled the business volumes for Real Products and Unlimited Energy. In addition, they agreed not to compete on price. The cumulative effect would triple earnings in two years.  The plan far exceeded the Unlimited Energy CEO’s wildest expectations and he immediately agreed.

authentic reputation

Since they were already at a global forum, they announced the agreement that afternoon. The additional publicity would reward the activist investors and improve the companies’ ability to raise capital for the acquisitions.

At the announcement, the Unlimited Energy CEO tried to cement the deal by praising his colleague. He told participants he was humbled by the brilliant strategy and grateful that the Real Products CEO wanted to work with Unlimited Energy. “Our stockholders will never again have to worry about their investments,” he said. “Real Products has ensured extraordinary returns.”

The Unlimited Energy investors who prided themselves on dominating the market were furious when they saw their CEO defer to his biggest competitor. Then they figured out that the remaining 40% would be owned by companies under Real Products’ control. Instead of an equal deal, their CEO had been hoodwinked into ceding control of 60% of the market to their competitor. They dumped their Unlimited Energy stock and the darling of Wall Street became a paper tiger without any authenticity.

Importance of Authenticity

The lesson is simple. Authenticity must be part of your nature. You need to be honest, open and consistent about this. If you try to deceive, it will be discovered.

In our story, the Unlimited Energy CEO presented himself as a businessman who was very confident in his own ability to control situations. So long as people’s experiences supported that image, it represented an authentic reputation. The challenge came when there was a disconnect. When people saw a deferential demeanor in the announcement it undermined their confidence in his ability to control.

authentic reputation

Authenticity is particularly important in crisis situations. In crisis communications, audiences can be hypersensitive and critical. If they find any inconsistencies in your behavior, they may dwell on them until they become insurmountable problems.

Five Ways to Protect Authentic Reputation

How do you avoid the inconsistencies that undermine your authentic reputation? If you can remain true to five principles of behavior you should be able to maintain your authentic reputation. They are:

  1. Honesty – You and your business should be honest about your true nature from the start. If your reputation still fits your character today, continued honesty should ring true.
  2. Integrity – Don’t pretend to be something you’re not. Likewise, stand up for your beliefs. If you find that your organization is changing, then address it as it occurs. Don’t wait for a crisis to advise stakeholders.
  3. Transparency – This doesn’t mean releasing proprietary or confidential information, but there should be a reason to keep information confidential. For other things that can impact stakeholders, transparency should be the norm.
  4. Values – The company’s values should be meaningful and influence behaviors. Use values to guide your behaviors and your authentic reputation will naturally be closer to your real priorities.
  5. Compassion – While it’s not a requirement for authenticity, compassion affects others’ perceptions. If you demonstrate compassion for others, they will be much more likely to show the same for you. If you want to get the benefit of the doubt, you need to give it.

Authenticity strengthens your company’s reputation. Remain true to your values and nurture consistent behaviors, even when it’s inconvenient. This will yield an authentic reputation that will serve you well when you need it most.

Fake Opposition in the Age of Conspiracy

Fake Opposition in the Age of Conspiracy

For many years I dismissed most conspiracy theories as superstitious ramblings of people who mistook institutional incompetence for nefarious intent. Not anymore! If you observed the Strzok hearing or the Russian Indictments last week, you know conspiracy theories are alive and well in the United States. The world has changed, and the pace of change has accelerated. The challenge in this new age of conspiracies is knowing whether it is real or fake opposition, and what to do.

If you are purely reactive, it may not even matter much whether it’s fake opposition. It will feel real to many and that may be enough to spell the end for you and your business. Conversely, you may avoid being a victim by being prepared and proactive. To better understand this conspiracy trend, let’s look at last week’s news and see what it can tell us.

fake opposition conspiracy

In the case of Strzok, many people believe he is a member of the deep state who is out to get the President. For many others, it is an abuse of power by those who will defend the President at all costs.  In the case of the Russia indictments, it could be a case of the deep state manufacturing these charges to undermine the elected President of the United States. Alternatively, it could be a case of a foreign power deliberately conspiring to undermine U.S. elections.

It’s disturbing that many people react just as violently against fake opposition as they do toward real enemies. They may even sacrifice their core values to combat fake opposition. Sadly, if they took the time to learn it was fake, they could have kept their integrity intact. Watch this phenomenon carefully, so you too don’t fall victim.

Communication Conspiracies

Even in years past, we all knew that some conspiracies existed, such as in espionage and criminal matters. Nevertheless, there were limits. For instance, I didn’t believe the Apollo moon landing was faked or that  Area 51 was only a front for extraterrestrial studies. However, I still don’t know what I think about Roswell. Frankly, I also didn’t want to believe that a friend or colleague would intentionally deceive me or fabricate information.

The world has changed. Well-documented conspiracies are already underway. Some of these communication conspiracies are from foreign influences. Other conspiracies are manufactured right here in the good old USA. There are simply too many tools available to create artificial opposition and too much to be gained. It’s not just your imagination anymore.

That doesn’t mean we want you to instantly distrust your best buddy. We don’t want to destroy all your enjoyment by having you obsess over intrusions.  Instead, we want you to be aware and careful to explore who’s telling you what and why, before you act.

Businesses’ Role and Exposure

We are going through a time when the rules are changing, concurrent with the ability to manipulate and distort facts. Economic and social institutions are being massively disrupted, with people lashing out at each other as they struggle for control. Government officials, interest groups, and even religious sects are fighting each other rather than preparing us all to better manage our future.

Increasingly, businesses and executives are stepping forward to try to make things better. Your first reaction might be that people are just expecting too much, but it probably has more to do with businesses’ vested interests.

Interest groups view the current situation as a zero-sum game of “our way or the wrong way.” On the other hand, businesses are all about building the value of their enterprise and want to do what they can to prevent harm. Politicians dismiss an opponent as just “one of them.” In contrast, a business sees that person as connected to scores of others. That one person could use word of mouth to damage or promote the business with thousands of potential customers.

fake opposition conspiracy

The Problem of Fake Opposition

You may have heard of scams where digital calls wait for you to say “yes” so they can charge you.  There are also cases where a scammer uses a fake email address or cell number to mimic a decision maker’s identity. In far too many instances, this allows them to trick bookkeepers into issuing large payments to the wrong people.

These examples show how far people are willing to go for the right financial incentive. In fact, they are quite good at it. Stories and impressions will also work. A news or gossip scam can be just as effective as a phone scam, and far more damaging.  While some are tired of fake news claims, we need to recognize their potential impact.

Consider what would happen if businesses were attacked by fake opposition. Instead of waiting for you to do something wrong, your detractors could just roll out one fake opposition front after another. It’s a nightmare scenario! Don’t wait for it to happen. Prepared now.

What to Do

Whether your business is a direct target or just collateral damage, you’ll probably feel the sting of fake opposition. You want to inoculate your business with a strong, positive reputation. Support your reputation with a robust and effective communication plan that includes strengthening stakeholder relationships. Don’t just store communication tools for an emergency. Regularly test, sharpen and exercise those tools so they are more effective.

fake opposition communication conspiracy

Furthermore, you want to be sure you are using the right tool for the correct job. Be sure the fake opposition problem you think you have identified is the real problem. With the extraordinarily powerful threats of weaponized media and AI reputation stitching we’ve described in previous posts, a dedicated attacker can inflict grave damage. Their communication conspiracy can ruin relationships with your stakeholders.

It may be tempting to launch a broadside counterattack against the local activist group that appears to be your problem. Before you do that, make sure it’s not fake opposition. Delve deeper and learn whether someone more dangerous isn’t supplying them with the information or resources. There are experts who can help you with this. Let us know if you need suggestions.

If you have any reason to suspect fake opposition, you want to know who is really against you. Otherwise, you’re fighting fires that could pop up anywhere. Worse yet, if you try to resolve the issue with the fake opposition, you could find you’re negotiating with yourself. In this age of conspiracy, knowing your real opposition can be just as important as what to do.

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Email: info@corporatecrisisgroup.com

Address: 405 Main Street, Suite 730
Houston, Texas 77002