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1. CORPORATE MANAGEMENT WITH NEW MEDIA
Crisis management and corporate reputation
By, Morteza Javadinia
Ryan Allag
Lecturer:
Vidhi Chaudhri, PhD

2. Agenda
• Definitions
• Insight into Theory
• Crisis types and responses
• Case studies : BP, Pepsi, Dell , New Medias Vs. Traditional
Communicating

3. Crisis
 “ The Perception of an unpredictable
event that threatens important
expectancies of stakeholders and can
seriously impact an organization’s
performance and generate negative
outcomes” Coombs (2007)

4. Crisis Management
 “… a set of factors designed to
combat crisis and to lessen the actual
damage inflicted; it seeks to prevent
or lessen the negative outcomes of a
crisis and thereby protect the
organization, stakeholders and/or
industry from damage. ”
Coombs (2007)

5. Crisis Communication
 “… a set of factors designed to
combat crisis and to lessen the actual
damage inflicted; it seeks to prevent
or lessen the negative outcomes of a
crisis and thereby protect the
organization, stakeholders and/or
industry from damage. ”
Coombs (2007)

6. Secondary Crisis Communication
 Secondary crisis communication will
assess the recipients’ intentions to tell
friends about the crisis, to share the
received information with others and to
leave comment.

7. Corporate Reputation
 The stakeholders’ collective
judgments of a corporation based on
assessments of financial, social and
environmental impacts attributed to
the corporation over time.
 Positive Reputation Include:
 Customer satisfaction
 Loyalty
 Trust
 Positive word of mouth

8. Insight into Theory
Attribution Theory: Based on Psychological Research
Crisis is seen as a negative event
Looking for responsibility
Situational Crisis Communication Theory (SCCT):
Founded on attribution theory to understand factors shape crisis
perception
Why do we need theory :
Crisis are serious time and during this time it would be better for mangers to rely
on evidence based ideas rather than just speculation

9. Focus on organizational legitimacy
• Reputation and legitimacy are not synonyms
“suffering from an imperfect reputation is less dire than suffering from an
organizational legitimacy crisis because being less well regarded by other
organizations does not threaten the organization’s continued existence”.
(Deephouse and Carter, 2007)
• Different approaches of legitimacy (passive/static VS “actional”)
Policies and communication activities are likely to alleviate the social issues to
which they were addressed and therefore reinforce perceptions of legitimacy
among publics.

10. Crisis Types and Responses
• Cluster by how much responsibility is attributed by stakeholders
• Victim cluster = Low responsibility
• Accidental cluster = Minimum responsibility
• Preventable (earlier called: intentional) cluster = High
responsibility
• Crisis Response:
• To what extent organization perceived as accepting
responsibility

11. Crisis Types and Responses
• 5 response strategy :
• Denial
• Excuse
• Justification
• Corrective action
• Diversion or Appology

12. BP, Pepsi, Kryptonite, Dell , Dominos
Case studies

13. BP
• BP took responsibility for the spill
• BP mainly used traditional Media to lessen the crisis
• Commitment to environmental responsibility
• Calling themselves as a leading developer of alternate source of
• energy
• b. New logo design, yellow and green sunflower
• c. New tagline: Beyond Petroleum
• d. Affordable, secure and does not damage the environment

14. Pepsi / Kryptonite
1993: Claims of syringes being
found in cans of Diet
Pepsi
Contingency plan
• Release of videos showing the different production
processes, showing how it was impossible that
syringes could end up inside the Pepsi cans.
• Alliance with FDA (Food & Drugs Administration)

15. Domino’s pizza
• Context: “Contagion”
• Dilemma of the hoaxes (paradoxical communication)
• Domino’s pizza challenge (Strategic actions)
Questions:
Should companies always respond to hoaxes?
“ Satisfied customers tell 3 friends, angry customers tell 3000 friends”, how do you
feel about this?

16. DELL
• Definitions: all around the Blogosphere
• Purpose of Corporate Blogs
• The Dell case
• Effects, must-do and limits of blogs
• QUESTIONS: Multi-authors blog or unique author blog?
Blogging the good stuff only or the bad stuff as well?

17. Corporate Blogs
Corporate Blogs
INTERNAL EXTERNAL
Organize culture
Share knowledge
Celebrate collaboration
Customer relationships
Sales and Marketing
Brand awareness

18. Thank you for your attention