Directors & Boards/ Learning from United’s PR Disaster

Four Board Tips for “Re-accommodating” Crisis

If you serve on the corporate board of United Airlines, this week started badly and quickly grew far worse. The ugly incident of a passenger being dragged off an overbooked United flight not only showed a company that’s lost its way on “customer service,” but also one that badly botched its response in today’s instant social media world.

You already know the details — a Sunday flight from Chicago to Louisville was overbooked, and United staff sought passengers willing to make room for a United flight crew needed in Louisville. One passenger, bumped at random, refused to leave, and airline security manhandled him, dragging him off the plane streaming blood.

United board members woke up to this news Monday, including a video taken by a passenger that quickly went viral. #United has been a top twitter trend since then (never a good sign), and massive negative news coverage led to a national spasm of outrage.

Related article: United Passenger Incident: Should the board step in?

It endlessly puzzles me that major firms, even those with a life-or-death need for good consumer relations, so often botch major media crises. And these debacles are not just a few days of minor bad news any more. Twenty-four hours after the United beat-down story broke, the company’s stock price had dropped three percent — $600 million in shareholder value lost.

What lessons can companies and their boards draw from this “fly the unfriendly skies” disaster?

1. Have a crisis plan in place. Have a crisis plan in place.
I wrote that twice because too many boards and managements still ignore this obvious need. Any consumer-facing business (which today is pretty much every business) must have a prearranged crisis escalation protocol in place for dealing with consumer incidents. Sure, major legal, leadership or product crisis plans are things any company should already have ready to roll. But what about dealing with an isolated consumer incident, something that’s easy to dismiss or ignore — until it explodes. Then, within hours, a social media and news storm can put the company’s brand itself in peril.

Work out a plan that details who is monitoring the social media matrix for such issues, how leadership will be apprised of flare-ups, and what steps and messages will be sent, and how. Run fire drills on a regular basis to make sure a smart response becomes basic muscle memory for staff.

2. Seek outside help.
Your company media relations and IR staff may object, but I advise prearranging support from a proven outside communications firm. As good as your internal media team may be, outside specialists have strong, real-time media relations contacts, and professional crisis management firms are constantly on the firing lines in spotting (and solving) sensitive public and political crises. They should be the ones alerting you to a blowup involving your public image.

3. Embrace the leadership test.
Board members look to the CEO when a public crisis strikes, and the CEO’s poise and messages determine how long he or she stays employed. While the United incident should never have happened, CEO Oscar Munoz compounded the problem with a lawyered-up statement about the unfortunate need to “re-accommodate” passengers (giving Twitter a whole new hashtag to play with). Plus, in a private email to United staff (assume in today’s world there is never such a thing as a private email), Munoz told staff that he had their back when dealing with “disruptive and belligerent” passengers.

4. Assess board disaster skills.
Rosanna Landis Weaver, of the As You Sow social investing service, writes that the United Airlines board includes heavy corporate hitters with vitae in such fields as aircraft technology, finance, and corporate strategy. What’s missing? How about directors with customer service expertise, and first-hand knowledge of dealing with consumers? If your board has no one who brings deep consumer perspective/expertise, expect customers to be treated as afterthoughts.

United Airlines is far from the only company to face a sudden, social-media consumer sinkhole. Uber, Wells Fargo, Volkswagen and too many other major firms have seen their brands suffer due to hubris, complacency and lack of skills. But such crises offer the rest of us vital lessons on the power of our customers, and the urgency of brand image in our social media age.

Betsy Atkins is a 3-time CEO and founder of Baja Corporation. She currently serves on public company boards: Cognizant, Home Depot Supply and Schneider Electric. She is also a member on the board of Volvo Cars (private) and the SAP Advisory Board.

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