Save a penny, lose a dollar

It has been a year since the explosion of the Deepwater Horizon oil rig on the Gulf of Mexico. Eleven people lost their lives and five million barrels of oil spilled in the ocean, the worst such accident in US history.

From a public relations point of view, it is surprising that corporations as important as BP reacted in such an inadequate way to the disaster. In fact, BP’s behavior is now the point of reference for what NOT to do during a crisis.

Prior to the accident, BP’s then CEO, Tony Hayward, had reduced the company’s PR budget, following the advice of consultants who obviously were not qualified to make such a recommendation. And much less in light of the coming crisis. The result was enormous damage to BP’s reputation and, therefore, also to its bottom line. By the way, Hayward lost his job as CEO as a consequence of his handling of the crisis.

A corporation which in 2009 earned 14 billion dollars started to save money in an area as vital to them as public affairs and in the end the paid for their mistake. As the saying goes, save a penny, lose a dollar.

A decision that was not only irresponsible but also lacked intelligence; because an oil company definitely knows that, sooner or later, an accident such as this can happen. And when it does, it must have a first-rate public relations team that is always ready to deal immediately and efficiently with such a crisis. Even though any corporation or government can face any type of crisis, this is true for companies that deal with especially risky fields such as airlines and chemical companies. It’s only a matter of time before an accident happens, never mind a terrorist attack. And if the crisis is not dealt with satisfactorily, it could lead to the end of the business.

That is why it’s so surprising that a corporation as prestigious as BP could be so shortsighted.

The other incident that, unfortunately, reminds us about the total lack of preparation when facing catastrophes is what happened in Japan.

I have visited Japan several times. I have dealt professionally with the Japanese and Japanese businessmen and women. The last thing that you’d imagine is that a country as organized and professional as Japan would not be ready for something that is totally predictable.

Japan is one of the world’s most earthquake prone countries. In that area, obviously, the earthquakes cause tsunamis, which is also to be expected. And is anyone surprised about the potential danger that a nuclear accident could bring about? The Japanese government and the company that owns the nuclear plant should have been ready for all these situations, but it’s obvious they were not. Something that is truly unforgivable because we’re talking about events during which the lives of hundreds of thousands of people are at risk.

It is true that the catastrophe was beyond what anyone could have imagined and that when something like that happens it’s hard to react. There is a collective psychological shock. However, I must state again, we are talking about situations that are truly predictable.

In addition to the structural and human disasters, there was an information one. There was a total void of reliable and precise information. The Japanese government completely failed when the population most needed this information to be able to make potentially life or death decisions.

No one knew how to deal with the media, what information to share, which recommendations to make. The information the public was getting was incomplete, half-truths or totally wrong. The Japanese media would say something and the international media would report something totally different. The nuclear plant owners would state something and independent experts would immediately deny it. The Japanese government would put out a press release and the US government would contradict it. And to this we must add the traditional skepticism that
many Japanese have regarding what many national companies say, because they’re well known for their lack of transparency. The result was a total information chaos which was aggravated by an environment of extreme physical and emotional tension. A perfect storm.

I know people who have family in the affected area in Japan. They tell me that no one knew the real security perimeter surrounding the nuclear plant, what they needed to do, where to find shelter or where to find uncontaminated water or food. This is not precisely the image that most have of a country such as Japan.

What happened? Didn’t the Japanese government have a crisis management plan in place for situations such as this, which are, once again, completely predictable? And if they had it, why wasn’t it put in place? Didn’t the Japanese government train its key personnel so they would know how to handle the media, known as media training, especially during a crisis? And if they did get the training, why did they act in a way that put the population in such danger?

How is it possible that multimillion dollar corporations such as BP or first-world governments such as Japan’s could be so poorly prepared for these types of situations? How is it possible that they could have made a strategic mistake of such magnitude?

Without a doubt, in disasters such as these the first priority for a government or corporation should be the physical security of people and the environment. However, during these events, the flow of reliable and correct information is
not secondary but also a priority because it directly impacts the security of the population and the environment. During a catastrophe, knowing how to communicate effectively saves lives.

Unfortunately, more accidents or natural disasters are in our future. We will see if BP and the Japanese government, as well as other institutions and businesses have learned from these mistakes or history will repeat itself.

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