When is resignation right for crisis management?

Rebekah Brooks took far too long to realise that the only option left open to her to protect her reputation (such as it now is) and, more importantly, News International’s reputation (such as it now is) was for her to resign. She might have had “total” support from Rupert Murdoch six days ago but there was little evidence of support outside the murky Murdoch world and it is always the outside view that counts for more.

It was not only crisis management experts who were aghast at her brazen attitude by clinging on, not to mention their brazen attitude by holding a surreal walkabout in an attempt to show that they were all in this together. We knew they were all in this together – up to their necks in it together – but it was not the togetherness that mattered. It was the subject – and the public was aghast at their arrogant attempts at toughing it out.

When crisis management gets to the point where you think the right thing to do is to tough it out – it’s not. It’s time to bow out – because you have made the wrong thing (you) the focus. If the crisis affects the business, it is the business’s reputation, not yours, that matters.

So, when should Rebekah Brooks have resigned?

She was not editor of the News of the World when, in 2005, Clive Goodman, the News of the World’s royal editor, and Glenn Mulcaire, private investigator, were arrested for illegally phone hacking Prince William’s phone. Nor was she editor of the News of the World when, in 2007, Goodman and Mulcaire were jailed. She was editor of The Sun. She was promoted to chief executive of News International on 1st Sepember 2009 at which point she became responsible, overall, for all the newspapers in the News International group. Phone hacking must have been on her agenda as a topic of concern; she should immediately have ordered, and announced, a clean sweep through all News International’s policies and set new standards.

When, in February 2010, the House of Commons culture, media and sport committee said it thought it inconceivable that no-one other than Clive Goodman knew about phone hacking at the News of the World, Rebekah Brooks should have announced that she had taken action to find out what exactly was going on and act on her findings. You can’t be at the top and ignore what is going on – even if the allegations apply to a time when you were not associated with the News of the World. It is now, and the future, that matter.

New allegations emerged in September 2010; Scotland Yard reopened its inquiry and the story began to snowball. The spotlight fell on Andy Coulson more than on Rebekah Brooks – but what was she up to, as chief executive? Instigating changes? Apologising? Or just hanging on?

In April 2011 News International apologised to some of those whose phones were hacked – and set aside a £15m fund for compensation claims. Resigning now, allowing a new chief executive to clear things up, would have meant a short, sharp burst of publicity followed by recovery. But she hung on.

On 4th July, The Guardian alleged that the News of the World hacked into Milly Dowler’s phone when Rebekah Brooks was editor of the News of the World. And what was her reaction? To shift blame by saying that she was on holiday. Astonishing. It did not wash. If you are in charge, you take responsibility whether you are working at your desk or paddling in the sea. It is your policy and your approach which are being followed – wherever you are. And if it is going on behind your back, all the public can conclude is that you are a weak and ineffective leader. You must go.

Arguing that you need to stay to oversee the clean up operation – otherwise known as doing a Willie Walsh – is short-term desperation that has nothing to do with saving the business; it is about saving you. Rebekah Brooks’ stance was indefensible as chief executive; it did even more damage to her own reputation, News of the World’s reputation, and News International’s reputation. It was clear that she was not up to the job. But still she hung on.

Hanging on is almost always a sign of ego getting in the way of business sense. If you want to limit the damage of a crisis, the time to resign is the minute it begins to affect the reputation of the business (or your own, if it is a personal crisis). Hanging on only prolongs the agony by highlighting wrongdoings (more claims, more criticism from public figures including prime minister David Cameron, the FBI, a major shareholder); increasing risks to other aspects of the business (BSkyB, ownership of other News International titles, US titles, other titles around the world); and sends costs spiralling – and not just the cost of flying in from afar, time spent at meetings and advertisements to say sorry and we won’t do it again, it is the costs-to-come of repairing a now much more seriously damaged reputation: Rebekah Brooks’ reputation, News International’s reputation, News Corp’s reputation, Rupert Murdoch’s reputation, James Murdoch’s reputation and, inevitably, the reputation of the entire British press.

Ironically, we might end up thanking Rebekah Brooks for hanging on while doing nothing at News International and inadvertently tackling tabloid tactics.

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News International’s reputation crisis – numerous lessons in what not to do

News International’s fascinating reputation crisis has highlighted so many issues about crisis management it is hard to know which to focus on in a blog giving tips. Meanwhile, the story keeps developing faster than I can keep up – which is typical of crises that are mismanaged. And that is lesson one:

Take control from the start. News International lost the chance to be in control – by not taking it from the start and that’s the first crucial and critical aspect of good crisis management, when a crisis blows. You can only do that if you anticipate the worst and mitigate against it. From News International’s point of view, the worst must be what is happening now – a problem with one publication in its stable has ended up shaking the worldwide reputation of the whole of News Corp. News International has been dodging the worst since the issue of phone hacking first arose. It hoped a couple of seemingly dramatic steps (Clive Goodman’s arrest and imprisonment; Glenn Mulcaire’s arrest and imprisonment) would convince us that it had got rid of the causes of their misdeeds. The problem is that the public suspected that they were acting on higher orders; someone sanctioned their behaviour, and that someone is still somewhere in News Corp. And that leads to lesson two:

Token gestures do not work. The sacking of Clive Goodman and Glenn Mulcaire didn’t go far enough – and didn’t we all suspect that? The announcement of an internal inquiry didn’t go far enough – and didn’t we all suspect that? Rebekah Brooks, it has just been announced, is now not going to lead that internal enquiry – and didn’t we know all along that she shouldn’t? Closing the News of the World ends its 168-year history – but aren’t we all questioning the integrity of all Murdoch titles, indeed all Murdoch media businesses? And that leads to lesson three:

Take swift, decisive action. If the sackings of the wrongdoers had been followed by significant shifts in policy which were then put into action, this crisis might have been avoided. It looks, though, as if the corruption was so endemic that it was impossible to stop it without closing the title. If that had been done then, when the issues first arose, the damage to News International would have been much less. Yes, there would have been a media frenzy. Yes, politicians would have spoken out. But some voices would have been supportive – and the impact much less as a result. And that leads to lesson four:

Consider those you might affect: A crisis in any organisation or business will have an impact on others. Some will be friends and some foes; your aim must be to win public support from friends and to keep foes quiet. Well, didn’t the News of the World do well. It’s hard to find any friends who have not turned into foes and those who have spoken out have had an enormous impact including big brand advertisers, charity partners and shareholders; we have yet to see what effect it has had on its readers. But it has had a much wider impact on organisations that were already in a weak position: threatening the future of the Press Complaints Commission (long due a wholesale overhaul); dragging the integrity of the Metropolitan Police into the open, yet again (long due a wholesale overhaul); raising serious questions about political friendships and contributions (long due a wholesale overhaul). It has thrown doubt on the prime minister’s judgement (not just about appointing Andy Coulson but also about forging links with editors). It will undoubtedly raise questions about other tabloids and whether they always tell the truth (we know they don’t). It is not inconceivable that others of its newspapers – wherever they are published – could be at risk. We know that it has affected News Corp’s bid for BSkyB. It will affect the public’s view of James Murdoch (who has stepped in to try to shift the image of the crisis but been unconvincing). And it will make people question the business ethics of Murdoch’s daughter, Elisabeth Murdoch, her husband Matthew Freud and his business Freud Communications (whose approach to crisis management has not always been the best). Which leads to lesson five:

Be wary of forging alliances: Having the support of big names – celebrities, brands, decision-makers – is inevitable; it adds credibility and draws attention. But it has a flip side; it’s the reverse of considering those you might affect: it’s about how your allies might affect your reputation if they do something wrong or inappropriate. That’s why Ford, the Royal British Legion and others have withdrawn their support; they cannot afford to be dragged down by News International’s dodgy reputation. And that leads to lesson six:

It takes years to build a reputation – and a second to destroy it. Of course, you could argue that the News of the World’s 168 year reputation was always as a distributor of sleaze – but millions read it (including, for several years many years ago, me) and millions loved it (including, for several years many years ago, me). It punctured puffery – but it failed when it failed to puncture its own. And that leads to lesson seven:

Don’t get too big for your boots. We see it over and over again. Success, or being surrounded by yes-men or being courted by the great and the good, makes people feel invincible. Peter Mandelson, Gordon Ramsay, Tony Hayward, Hosni Mubarak, Fergie, the Pope, HMRC, British Airways, Tony Blair, Alastair Campbell, Rupert Murdoch, Rebekah Brooks … they all faced crises because they behaved as if they were above it all. And that leads to lesson eight:

It’s all about trust. For decades, dinner party chat has been about Murdoch, his approach and his publications – and not in a good way. The public does not trust Rupert Murdoch. We see politicians toadying up to him and his editors, and we don’t like it. We see a man consumed and convinced by his own self-importance, and we don’t like it. We see a business empire getting ever larger, with fewer controls from outside, and we don’t like it. We see him protecting editors and others even when there is evidence that they were implicated, and we don’t like it. Because, just as we all believe in the freedom of the press and their role to tell us what others are trying to hide, we don’t like having the wool pulled over our eyes by people whose role it is to expose the truth, but who lie themselves. We knew there was worse to come and that it extended well beyond the News of the World; we had little trust. Which leads to lesson nine:

Face the music. The most striking image of all throughout this saga was the one of Rupert Murdoch – a media man who knows the rules – when he said “no comment” – the biggest sin in media management – when door-stepped by journalists. When you say nothing, the only inference people will make is that you have something to hide. We all know that there must be more to come. Much more. We’ve had fudge, denial, pretence, lies. We’ve even had Rebekah Brooks claiming to be on holiday every time a problem arose (as if that means she is not ultimately responsible). They have not worked. They never work. They do not build trust. They will always be exposed. Which leads to lesson 10 which is, in reality and always, lesson one:

Be honest, open and transparent: It’s the only mitigation factor that works – and it works every time.

The question is: will we ever get the truth, the whole truth and nothing but the truth from News International?

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