Public Relations Crisis Management Plan - Dissertation Example

Public Relations Crisis Management Plan Current Relevance The present age of competition and turbulence in the business environment has triggered a wave of competition among the business organizations to ensure organizational efficiency. In order to emerge successful in this age of turbulence it is very essential to have a good relationship with the customers as well as the community and society. These calls for the need to ensure better inter organizational communication. Advancements in technology and the role of media have also assumed to be of significant importance to business organizations. The immense reach, popularity and the influence of media in shaping public opinion has augured the need for having a dedicated public relations department that seeks to leverage the media to shape a positive opinion and image of the firm in the minds of the customers. The role of the public relations department also assumes significance in areas of crisis management in organizations as they largely tend to act as medium of communication between the organization and the external world. SWOT Strengths The main strengths of the company include a strong brand image of the organization and a product portfolio that has an evergreen demand in the market. The company’s presence in a market like Australia also adds to its bouquet of strengths. Certain other strengths include a talented and motivated employee base along with sound financial strength of the organization. Weakness The major weakness arises in the aspect of the rising cost of fuel and raw materials and it’s over dependence on external suppliers for raw materials. Opportunities The rising disposable income and demand for products such as cars largely influence growth of prospects for Hypothetica oils. The surge in demand witnessed over the last few years with an optimistic future largely emerges as an area of opportunity. Opportunities also exist in the form of new markets like China that have high potential. Threats The threats to the company arise mainly from the high extent of competition in the Australian market. Presence of large number of competitors in the market leads to a situation where market share and profit margins have reduced significantly thus generating considerable threats for the organization’s profitability and sustainability. Target Publics Primary Publics The first step towards shaping a public relations strategy involves selecting the public’s to be targeted. Publics constitute a collection of a number of individuals that have a set of similar interests and value proposition with regards to a particular scenario (Millar & Heath, 2004, p.42). Primary publics constitute the individuals that a firm tries to generate influence. This largely consists of individuals whose thoughts largely help in ensuring profitability and sustainability for the business. In the case of Hypothetica oil the primary publics would consist of the customers of the organization and the common people at large who form a part of the social network of the company. This would also include the employees of the organization as it is largely important to have a positive image of the organization in the minds of the employees as it largely helps in inducing motivation which is very critical to the success and sustainability of an organization. Secondary Publics Secondary publics include members of target audience that have the ability to act on the behalf of the company and have the power of influencing the primary publics with regards to a particular situation. Secondary publics in this case would include the media that includes both forms like electronic and print media. Another key secondary public is the government of a nation. Influencing the government in a positive manner can lead to generation of impacts that can largely help in influencing public opinion about an organization. The identification of primary as well as secondary publics assumes significance considering the fact that there are differences in the nature of strategies to be adopted for each of these publics and any misinformation or wrong selection can lead to disastrous consequences for an organization. Research The topic of study revolves around the case of Hypothetica oil which is an Australian oil and gas manufacturing and distribution company. The company was in the news in 2010 when there was a major oil spill in the high seas that largely impacted the natural ecosystems at the great coral reef. The oil spill resulted in a major damage not only to the natural ecosystem of the area but also generated a negative image of the organization in the minds of the public’s around the world. This assumes significance as the firm faced tremendous crisis as its image took a drastic hit that led to considerable damage to the aspect of positioning and brand image of the organization. Numerous organizations have faced PR crisis like Hypothetica oil. Among the most significant of these include the case of Toyota motors in USA which was hit by a series of crisis following the accidents in some of its models. The reason for these accidents was largely accounted to a manufacturing defect which the company refused to accept in the initial phase. This series of accidents following the incident led to a considerable dent in the brand image and positioning of the organization. The company’s PR skills and strategies came into a lot of debate over its effectiveness in tackling the situation (Liker, 2011). The importance of PR startgies assumes large scale significance considering the influence of media in shaping public opinion. Experts have argued that managing communications and handling crisis using PR skills and media can lead to better results for an organization considering the act that media acts as an independent source of information that makes it a stronger medium for crisis management and image makeover as compared to advertising strategies (Queensland Government, 2009, p.1). An effective Public Relations strategy begins with identifying the short and the long term goals with regards to the nature of information to be used in the PR strategy. Certain other factors include setting up accountability and responsibility apart from having a proactive approach towards the issue. Identification of media sources is also important as they largely act as communication mediums for the spread of information. It is also important to have a well knit strategic framework that would act as a guiding template for the organization in the event of a crisis situation. Finally the most important element remains to have a good relation with the different stakeholders including government as it is important to take them under confidence considering that they act as secondary publics for the PR strategy of the organization (ILMC, 2001, p.2). There have been a large number of theories and models devoted towards the area of public relations in business organizations. The theory proposed by Grning (1976) states the importance of the direction of communication and its purpose in four different ways which includes press publicity that involves a one way flow of information, publicly available information which is again a single direction communication flow, a persuasion type in which there is two way communication and finally a relational approach in which there is a two way symmetric flow of information (Millar & Heath, 2004, p.41-42). Figure 1: Model of Public Relations Strategy (Source: Millar & Heath, 2004, p.41) The model shown above largely stresses upon the inter linkage between organizational structure and the public’s towards crafting an efficient strategy for public relations. A public relations strategy must essentially include a synergy between organization’s internal aspects and strengths and the proposed PR strategy. This is important as it is largely important to have the different internal stakeholders into confidence while dealing with a crisis situation (Millar & Heath, 2004, p.41). The theoretical elements highlighted above show the necessity of drafting a PR strategy as an efficient one can reap strategic advantage for the organization whereas a weak strategy can lead to disastrous consequences on the brand image and positioning of the organization that can affect the nature of profitability and sustainability of the firm in the long run. Proposed Approaches Elaboration-Likelihood Model The Elaboration Likelihood Model proposed by Richard E Petty and John T Cacioppo states that there are two main ways in which messages can be held for processing. These two ways include a central and a periphery route. On one hand the central route lays stress on the providing complete information in a straightforward fashion whereas the peripheral approach uses aspects like endorsements, advertisements and use of attractive features like display and colour to process the flow of communication (Witte, Meyer & Martell, 2001, p.42). In the context of the issues at Hypothetica Oil a mixed approach that effectively includes a combination of the peripheral and central routes should be used. The central route would include press releases, media address and other aspects where the information would be routed through the media. The peripheral route would involve use of advertisements and other tools of marketing communications like promotional campaign to reach out to the target respondents. A combination of these two approaches would on one hand allow the advantage of getting connected to the masses (via the central route) and to target specific segments (using the peripheral route). This would help include a large target audience to which the message can be spread out so as to improve the positioning and to respond effectively to a crisis situation. Persuasion Tactic Persuasion is a major tool that is used in PR strategies of business organizations. The major consideration to be followed in persuasive tactics involves propagating messages that are believed to be essentially true. In addition to this the sources of media to be used for persuasive tactics should also be reliable (Heath, 2005, p.616-617). In case of Hypothetica oils it is generally useful to use the print as well as the electronic media as a medium for communication as these sources have large credibility amongst the masses that can help enforce the effectiveness of the message to be communicated. Influencing Public Opinion In order to have a favourable public opinion Hypothetica oils must try to first acknowledge its mistakes publicly. This would also include provisions and planning by the organization so as to ensure that such mistakes are not repeated. In order to influence the public these messages should be propagated using credible media sources to spread the information. Promotional campaigns as a part of peripheral communication strategy must also be used. Selecting a credible personality as a brand ambassador can also help shape a favourable public opinion among the masses as well as the stakeholders of the organization. Recommended Delivery Approaches In order to regain a favourable positioning in the business markets it is very essential to include a communication mix that selects the actual means by which Hypothetica oils can improve its positioning in the market. The company should use all possible sources of communication including television, newspapers, radio and also the online channel such as social networking to spread a positive image. The company’s primary publics would involve the general masses, stakeholders and employees whereas the secondary publics would involve media and government. Adherence to compliance as well as using CSR measures that aim to take care of the damage as well as promote the general well being of the environment can have a positive influence on the primary publics thus ensuring a proper management of the crisis situation. A credible person can be appointed as a brand ambassador as a spokesperson who would be responsible for communicating the message. The credibility of the person would add to the effect of the public relations strategy of the organization by enhancing its credibility and acceptance among the targeted audience. Tactics for Implementing Communications Strategies Media Release Headline- HYPOTHETICA TO PAY FOR ENVIRONMENTAL DAMAGE Date- 24th may 2011 ‘This is to bring to your kind attention towards the major issue of oil spill in the Great Coral Reef. The company is fully aware of the magnitude of the disaster and take full responsibility for the crisis. The company in this regard would also like to state that the mistake was fully unintended and happened by chance. However taking full responsibility of the crisis the company has appointed an expert panel comprising of an independent counsel to probe into the matter. As a part of the compensation towards the damage the company ages to provide monetary as well as other resources that can help in minimising the damage and to bring back the coral reef to its normal position. In this regard an effective policy to monitor operations has been implemented. An external consultant has also been hired to analyse the business process and suggest means of improvement. Quality checks and monitoring would be made more stringent and accountability would be fixed. This process is being personally monitored by the CEO so as to ensure speedy strategy formulation and the results are expected to be announced very soon. Finally on the behalf of the entire management team of Hypothetica Oil we would like to render our sincere apologies and make a solemn promise to ensure no such repetition of the mistakes in the future and ensure development of the society.’ Hypothetica Oils Ltd 14 ABC Avenue, Sydney Australia. Proposed Budget The proposed budget for handling the crisis would be divided into two heads. The first would involve the spending towards the central and peripheral routes of communication. A total of 25000 US Dollars would be spent on this that would include advertisements, ads on TV, radio, hoardings, notices, press and media releases etc. In addition to this the company would also spent about 50000 US dollars towards setting up control and feedback measures. Approximately 10000 US dollars would also be spent on CSR measures that would seek to help undo the damage to the natural ecosystem of the Coral Reef. Provisions for extending this amount would also be made depending upon the findings of the expert committee that would provide the actual magnitude of the damage in terms of monetary value. Strategies to Monitor the Effectiveness of the Implementation In addition to formulating strategies it is also important to have a feedback and evaluation mechanism that seeks to ensure viability of the strategies. In case of PR management at Hypothetica Oils a monitoring mechanism would involve a mix of market research and management practices. The company can conduct market research that would help in analysing the effectiveness of the PR strategy. The market research would be both qualitative and quantitative in nature and would use primary data collected from relevant respondents. This would help in evaluating the present strategies so as to make amendments in these strategies if necessary. Finally a balanced scorecard method can also be implemented that would help in analysing the financial as well as non financial strategies so as to ensure business efficiency. Concluding Thoughts In the age of increased market competition it has become imperative for business organizations to ensure proper risk and crisis management strategies. The unexpected and sudden nature of these situations as highlighted by the case of Hypothetica Oils calls for the need to ensure formulation of contingency plans that can be used to handle crisis in an effective and fast manner. Crisis management techniques should also include an effective PR strategy that could be used to communicate the views of the company in times or crisis. It is also essential to have a proper cell dedicated towards crisis management that should formulate contingency strategies for the organization. Tools like Balanced Scorecard should also be implemented that can help the firm to evaluate its strategies in a proper timely manner. Incorporating these elements would not only help save the firm in times of crisis but would also help reap sustainable competitive advantage in the long run. References Heath, R.L. (2005). Encyclopedia of public relations, Volume 2. SAGE. ILMC. (2001). Effective Communication and Public Relations. [Pdf]. Available at: http://www.ilmc.org/toolbox/PDF/1-5%20Effective%20Communication%20and%20Public%20Relations.pdf [Accessed on May 19, 2011]. Millar, D.P.M, & Heath, R.L. (2004). Responding to crisis: a rhetorical approach to crisis communication. Dan Pyle Millar. Liker, J. (2011). Toyota's Recall Crisis: What Have We Learned? [Online]. Available at: http://blogs.hbr.org/cs/2011/02/toyotas_recall_crisis_full_of.html [Accessed on May 19, 2011]. Queensland Government. (2009). Effective PR. [Pdf]. Available at: http://www.arts.qld.gov.au/publications/pdf/ma_ef_pr.pdf [Accessed on May 19, 2011]. Witte, K., Meyer, G., & Martell, D. (2001). Effective health risk messages: a step-by-step guide. SAGE. Read More