Team 4 Readings/Presentation

Team 4’s reading provided some insight into a subject most of us didn’t know the details of (Red Cross’s mishaps regarding both September 11 and Hurricane Katrina) and things we didn’t even know we should be thinking about (Think Like a Sociopath, Act Like a Saint)!

As we learned in the Red Cross case, sometimes, no matter how prepared an organization is, unexpected crises appear without warning. As Coombs states, “An organization avoids crises by taking action on crisis warning signs and reducing its factors.” Well, if you can’t even see on the horizon the hiring of a convicted felon, how could you possibly prepare for that? Of course, deadly natural disasters and crises of Katrina’s proportions weren’t foreseen either (although, ask the Army Corps of Engineers about that one) and the Red Cross desperately needed volunteers.

One could argue that this man, maybe reformed maybe not, was doing his job of being a good volunteer. Did his track record really affect the job he was doing on behalf of the Red Cross, and as a volunteer (not a paid employee), mind you? As we discussed in class, has he paid his dues and now should be absolved of all wrongdoing, as long as his past doesn’t affect his job? Whether or not that’s the case, he was technically a member of the Red Cross. Although he wasn’t an employee, he was working on behalf of the organization, the organization trusted him enough with a management role and substantial financial responsibility. The real issue here is that Red Cross’ communication systems was quite jolted by the hurricane and it needed in place more managers to do background checks on potential volunteers. Red Cross is certainly suffering these days; as Coombs says, “A favorable reputation builds up the (bank) account, whereas a crisis subtracts from the account.”

The Mitroff article was great and should be required reading for public relations managers in any arena! This article really showcases how important it is to examine the improbable. I thought, too, that the article and issues brought up in it just weren’t for public relations professionals. PR is there to help management see what they aren’t seeing, but PR cannot be the final word. PR can only offer so many suggestions hoping management sees the light. But suggestions from the article, such as the crisis wheel, where managers are forced to deal with uncomfortable situations in a quick-thinking atmosphere, are just what they need to think outside the box.

It struck me when the article mentioned, “it will be a long time before we can say that the entire food system is truly protected against bioterrorism, if ever fully.” This is absolutely true. Terrifying, but true. As much as we like to think most people are rational and couldn’t possibly commit the unthinkable, they can and they will. I think of many popular TV dramas these days such as 24, CSI or Law & Order. We see criminals on these shows every week commit horrendous crimes and yet we know very well that people are watching these shows and getting ideas. It’s scary and we must be aware this is not just television! Most companies at some point will have some disgruntled employees who may consider doing harm to the company or its employees. The article describes these people as “internal terrorists” or “internal assassins.” These are people who have intimate knowledge of companies, products and procedures and can do more damage than managers may be willing to admit. You can apply some of the Coombs reading here. Whereas, “likelihood” of something happening may be low, “impact,” or the amount of damage a crisis can inflict on an organization, can be infinite.

The Ethical Company: Johnson & Johnson

Johnson and Johnson credo is described as not only an ordinary cooperate mission statement of the kind we are used to, but as the best credo in the cooperate world. The Associated press journalist Susan Todd (2004) indicted that while most companies’ credos are directing and without heart and soul, it was not so with Johnson & Johnson credo. The credo demonstrated well the meaning of cooperate social and moral responsibility, a quality lacking in most organizations as they are often profit focused. It is clear that the credo is not just an additional decoration within the company walls and offices, as the aspirations and the spirit of the credo are made a reality in the day to day dealings of the company executives and employees. This was exemplified during the Johnson & Johnson crisis of the Tylenol laced cyanide in 1982 whereby apart from reiterating the credo, the CEO recalled all the bottles of the existing Tylenol, irrespective of whether they were contaminated or not. This was even done before the source of the contamination was determined. This demonstrated the heart and the soul part of the credo and sent a clear message that it was not the business that mattered most, but rather the customers. Frandray (2000) rightly described Johnson & Johnson as the ethical company. There are very few companies that can fit this description. Most decisions taken by the company executives are more guided by profits than credibility and customers. It goes without saying that the cooperate world should emulate Johnson & Johnson and move beyond having nicely worded vision and mission statements to demonstrating it by actions.

I have observed companies with nice looking and worded credos but their business dealings with customers leaving so much to be desired. This is often mostly the case in Africa where customers are taken for granted because they are not as enlightened on their rights as western counterparts. It would be very interesting to hear how Johnson and Johnson ensures that the standards maintained in developed countries are the same ones maintained in developing countries such as in Africa. I have noted the presence of Johnson & Johnson in Zimbabwe and South Africa and it would be very interesting to note issues that may have occurred in these regions and how they were addressed.

Why would someone steal from the Red Cross?

I read the article about the charges against the Red Cross in regard to handing out aid for Hurricane Katrina victims. There were many cases of supplies that were not were they were supposed to be and supplies being handed out without following the proper documentation procedures. In one case, a lady issued herself two money orders and cashed them not far from where she was working. Talk about mass chaos.

The Red Cross has a policy of not hiring felons, which is a good policy. With all the things they do and hand out, it is good to make sure that no one is trying to steal from the people who need it most. In the case of Hurricane Katrina, the Red Cross got such a large influx of volunteers to go and help that they were not able to check the backgrounds of all the volunteers. This is something they should have done. While they may not have had the time to, they should have appointed a few people to just check backgrounds. It would have slowed the process a lot, but they would not have had the same problems they have now.

When I read the articles, I was appalled. I can not imagine why someone would steal from the Red Cross. In my mind, they help so many people and do so many nice things that I assumed anyone would feel horribly guilty for stealing from them. Obviously, not everyone feels the same why I do. I’m sure some people volunteered to help with Hurricane Katrina because they saw an opportunity to take things. Why some people think they way they do, I’ll never know.

The Red Cross should get to the bottom of this and press charges. I think they are already doing so, but if not, they should. It may take a while to investigate everything just because so many things were messed up, undocumented and went wrong. In one case, volunteers were handing out supplies to people who just drove up and said they needed them. The people did not even have to prove that they needed what they were getting. They could have been people from an unaffected area that were just looking for cleaning supplies. They could have also been the friends of the volunteers who were looking to get cleaning supplies or to sell them later and make some money.

With every disaster, there is always someone looking to capitalize on it. This is unfortunate, but the way of the world. In this instance, the people who wanted to capitalize in the disaster volunteered to help out the Red Cross. I think the Red Cross learned a lesson for the future; everyone who wants to help out is not always helping for the right reasons. Some people want to help out as a way to make a few quick bucks from free handouts they do not even qualify for. I think the Red Cross was handling this well by getting rid of a guy who they found out had already been charged with auto theft and for saying they were looking into the situation.

March 6 - Team 4 readings

Redd Kross: Although now one year old, Team 4’s Red Cross article offers further proof of the post-Katrina chaos that continues to consume New Orleans. But it also illustrates a growing body of evidence in instances of corporate and governmental malfeasance. A “breathtaking systematic failure by senior managers to enforce inventory control procedures,” and an “outright contempt for well-established internal fiscal controls” (pg. 3) shouldn’t surprise us anymore, even when it concerns the Red Cross—an organization most of us would think beyond reproach. Although I missed this report the first time around, these things don’t faze me anymore. It’s just another example in a long list of documented organizational dysfunction, some with intent to do harm. And, at least to me, it reaffirms the existence of some of the less-than-desirable traits of human nature.

Beyond the managerial ineptitude, several specific incidences in the article point to how people will take advantage of others if opportunity presents. Even if it doesn’t, people will manufacture opportunity if they think they can get away with it—especially when the transgression could be deemed “victimless.”

Although there certainly is much philanthropy in the world, the list is equally long on the flipside: government scandals too numerous to mention, including the current fiasco at Walter Reed Army Hospital; U.S. and global corporate malfeasance abounds including Nestle USA’s well-documented transgressions against Third World mothers and children, Wal-Mart’s pressure on suppliers to continually lower costs, which translates into abusive labor practices; legions of abuses by “trusted” leaders of the Catholic Church; and virtually every disaster relief effort in the world suffers from varying levels of greed as both financial and material contributions are siphoned off before victims actually benefit.

Your President’s Modus Operandi – by Ian Mitroff
Eye-opening, at least for me. Forcing executives to change their way of thinking, with an eye toward “creative demolition” (pg. 45) explained how companies could face and possibly manage abnormal accidents. On page 44 Mitroff says, “it is estimated that up to 80% of all terrorists acts happen to private businesses and not the government.” Why estimate? Seems like an easily verifiable statistic.

The “internal assassin,” “spy game,” and “mixed metaphor” scenarios made thinking like a controlled paranoid kinda fun. And remember, after driving 900 miles to kill someone while wearing diapers, dress like a Domino’s pizza delivery person—that will get you in.

This Mitroff guy might be a genius, but I don't trust him. He might be lurking outside my house right now. Or he could show up in class disguised as a former executive from Johnson and Johnson.

Some J & J Thoughts from Ronnie

Johnson and Johnson’s handling of the Tylenol crisis is a casebook study of what to do right. I am certain everyone here is familiar with it, so there is no need to wax excessively about it here. Random bottles of Tylenol contained pills that had been laced with cyanide. The connection to Tylenol was made after several people tied. Johnson & Johnson immediately recalled the product and told consumers not to use Tylenol again until they (Johnson & Johnson) advised them otherwise. Johnson and Johnson put customers first – and in so doing assured the success of their company and of the particular product once it was put back on the shelf in tamper-proof packaging.

Those actions fit with the Johnson & Johnson credo of people first and their belief that their “first responsibility is to the doctors, nurses and patients, to mothers and fathers and all others, who use our products and services. Stockholders come last. That is not to say that Johnson & Johnson is not interested in making a profit – obviously like any corporation they are. But it does seem that they have learned to live by the idea of true customer service.

In a different kind of way, that is what Jet Blue is attempting to do as it tries to regain its footing after the bad weather debacle at Kennedy Airport that left passengers stranded on the tarmac for hours. In this day and age, the incident of course spurred a blog, http://jetbluehostage.blogspot.com. Jet Blue CEO David Neeleman has gone public with his apologies and with the presentation of the company’s own passenger bill of rights. Regaining customer confidence at any cost seems to be Jet Blue’s credo these days. Something has been learned.

Reaction March 4 – Think like a sociopath, act like a saint

Mitroff argues that traditional ways of thinking when planning for crises can work as a scanning mechanism for determining risky and weak areas for an organization, however conventional ways of thinking may be damaging at the same time. He argued that the conventional methods for thinking about crises are largely responsible for causing major crises instead of acting as an early detection mechanism. “Conventional methods are too ‘rational’ to anticipate and cope with abnormal states of mind” (p.43).

The new type of crises Mitroff talks about in the article are referred to as “abnormal accidents”, which are intentional accidents caused by deliberate acts of evil such as: bombings, kidnappings, cyber attacks, cheating, stealing, and manipulating the truth.
These abnormal accidents are a result of intentional break up of complex technical, organizational and social systems.

But due to the abnormality of these intentional crises, they are not easy to plan for and consider while planning for future crises. However, businesses today need to plan and get ready for the abnormal. So many of the recent business scandals and other organizational crises seem so unreal that it is hard for organizations to think that it will happen to them, but they actually can happen to any organization. Organizations need to prepare for abnormal accidents by developing special skills and new thinking skills.

Executives can start preparing for these abnormal crises by engaging in different organizational exercises. One of these suggested exercises is the “wheel of crises” where executives force themselves to select crises randomly and apply it to their organization. Another technique is asking people to act as “internal assassins” and role play to find out the weak points of the organization or the production process to identify weak points and possible scams organizations might be in danger of. One more strategy is “spy games” where people from outside the organization asses the systems of the organization and provide the company with a list of possible problem areas.

Mitroff suggests executives and managers to think like a controlled paranoid by “developing the ability to think so that one can forecast potential threats against one’s person, organizations and institutions with which one makes contact” (p. 49). This kind of thinking the absurd also helps executives to realize more bizarre situations they might be in danger of, which they cannot realize through conventional ways of thinking.

This article makes us realize that organizations need to start thinking about the unthinkable if they want to prepare for the crises of today. Being a paranoid may help managers and executives to identify certain situations and potential problematic areas that might put them in danger in the future.

Chapter 4 Crisis Prevention & J&J Credo

Coombs (1999) explained issues management as “the idea is to have the issue resolved in a manner that is not a crisis” (p. 41). He emphasized the proactive role of issue managers, “Issue managers may decide that the best way to resolve an issue would be to correct or improve operating standards and plans” (p.41). Proactive issue management can be the corrective action before the crisis may occur. Coombs (1999) also explained staying close, organizational credibility, and meeting expectations as three central elements of a favorable organization-stakeholder relationship. I believe that among these three, organizational credibility is the most significant since credibility is the fundamental in every relationship. Coombs explained “Credibility can be divided into two components, expertise and trustworthiness. Expertise is the communicator’s knowledge about the subject. Trustworthiness is the communicator’s goodwill toward or concern for the receivers” (p. 46). Credibility is the trustworthiness based on expertise.
Credibility is not built in one day. Credibility is delivered with a track record of successes, of promises kept, and trust built over a long period. Most international companies have their own “code of conduct” or “code of ethics”. Johnson & Johnson’s credo is also company’s philosophy to demonstrate the corporation’s responsibility to customers, employees, the community and stockholders. I understand that J&J’s credo is the company’s efforts to build credibility with their publics not only in normal times but also in crisis. The code of conduct or code of ethics shown in corporations’ Websites usually seems just perfect and nice words to take responsibility of its customers. However, to make those words alive, the corporation should show their actual practice in real world. In case of J&J, Tylenol crisis of 1982 and 1986 proved that a corporation truly put customers’ safety prior to all other loss. J&J successfully managed the crisis and made the threat to be opportunity to regain successful reputation. If the corporation didn’t manage those crises successfully, it would have meant that the corporation didn’t keep their credo in reality. Also according to J&J’s explanation about the credo history, the company conducts a periodic survey and evaluation how well the company performs its Credo responsibility. These research and evaluation are fundamental two way communication processes and also the practical efforts to show the corporation’s Credo in real world.

Johnson & Johnson Comments

Please peruse the Johnson & Johnson web site, especially the Credo and its history, before the visit by Bill Nielsen on Tuesday. You can "comment" on this post to make your reaction and thoughts public for the rest of the class.