How to handle a crisis like Ayala's, Gokongwei's
MANILA, Philippines – Two of the country's biggest conglomerates run by 2nd generation family members of Filipino dollar-billionaires were involved in crisis situations 3 days apart.
The reputation of the Ayalas and Gokongweis were at stake when one business unit of their diversified portfolios figured in an incident that harmed lives.
While the events were tragedies in themselves, it is what unfolds afterward that is of crucial importance to the future reputation of their empire.
Amor Maclang, a publicist who has dabbled into public relations, and now crisis management through Astrolabe, said that how companies manage a crisis allows them to put their best — or worst — face forward to either win a new fan base or lose customers.
Taking off from what Gokongwei and Ayala groups did right or wrong, here are 7 tips by a PR practitioner on how to handle a crisis:
1. Determine what a crisis is
Dictionary definitions consider crisis as a 'time of intense difficulty, trouble or danger.' There is no formula on whether lives were lost, or the number of people or entities injured, displaced to consider a situation of crisis proportions.
“Sometimes the one thing that freaks people out is determining whether it’s a crisis or not,” explains Maclang. Both the Ayala-led property firm Ayala Land Inc. and Gokongwei-led budget airline Cebu Pacific handled the incidents they were faced with as crisis situations.
The blast at the Ayala Land's high-end apartment complex called Two Serendra in Bonifacio Global City in Taguig's commercial and residential district killed 3 people and injured 5. The incident happened on a Friday night, May 31.
The following Sunday, June 2, a Cebu Pacific flight from Manila to Davao carrying 165 passengers overshot the runway after it landed amid bad weather. No one was hurt during the incident.
2. Focus on de-escalation
When issuing statements, both companies were prompt at providing the media with an initial report. Within the prescribed 3 hours after the event, both the Ayala Land and Cebu Pacific were able to issue an official statement.
“The only thing you report after a scenario is what you can verify. They would have been irresponsible if they tried to give opinions as to what happened without scientific backing. The 'holding statement' should be issued two to 4 hours after the event to communicate with the stakeholder,” said Maclang.
Initial reaction to the Serendra incident was swift and efficient, with President Benigno Aquino III appearing at the scene even before Interior and Local Government Secretary Mar Roxas did. The Taguig police called for an investigation, while the Bureau of Fire Protection (BFP) and the government took a week before announcing the results of their investigation.
According to Maclang, the de-escalation is something Ayala Land and the government did well. “They were calm, objective, and went into the heart of explaining. A lot of it is because the people in Ayala Land knew what their priorities were," she said.
"The first thing you need to secure is life-in-a-crisis. Ayala prioritized the security and welfare of the people,” she said, referring to the evacuation and transfer of the affected units' residents to an Ayala-led luxury hotel.
On the other hand, Cebu Pacific failed to contain the complaints coming from irked and traumatized passengers in the crucial first hours of the 'crash.'
“I feel in the case of Cebu Pacific it did escalate. The way the issue was managed lent itself to escalation, not de-escalation,” she noted.
Passengers took to social media to share their horrible experience of being in a plane that landed on its nose, and who were left waiting for about 15 minutes in a smoking aircraft without being told what was unfolding before being evacuated on emergency slides.
There were no injuries, but the ire was in the response.
3. Choose a 'public face'
A credible representative is needed, Maclang emphasized. The company must assign a "public face" that will cajole, convince, dissipate the anger or worry of the company’s important stakeholders, and show compassion to the victims.
The choice of spokesperson is important as he or she will become the company's public face whose looks and demeanor during every media appearance will be scrutinized.
In the Serendra incident, the full force of the relevant government bodies were immediately put forward with Roxas acting as the public face. However, what was notably absent during this incident were the Ayalas themselves even if the property developer and gas supply, which caused the blast, are both owned by the busines group.
“I can only guess the reason why it was a government official and not Ayala was to rule out that it was not a terrorist attack,” said Maclang.
“Given the high profile of the investigation, the opportunity was there for them [the Ayalas] to go out and ensure the public, their various investors, and those who are engaged in the various properties of their brand,” she added.
Maclang explained why — at least, from the public relations point of view — she thought this Ayala Land strategy worked: “Whenever you have a crisis and risk team, the person who is speaking on behalf of the company or organization should be different from the person who is managing from the backend. It doesn’t have to be the CEO (doing both).”
“You need to separate the CEO from the person who is on top of the situation from the person who is speaking. You should not purely put a PR agency on top of a crisis. You need an enterprise risk strategist. PR and communications is merely one aspect of an overall crisis scenario,” Maclang shared.
Cebu Pacific CEO Lance Gokongwei defied this when he made a public apology to those whose travel plans were affected.
“Even if there was no death, Lance Gokongwei was there. Unless there’s a death involved I don’t usually bring out my king,” said Maclang.
4. Explain, don't defend
Cebu Pacific "over explained" without offering restitution, Maclang noted. It took two days to remove the stuck airline blocking the Davao airport runway, stranding thousands of passengers.
Gokongwei also became defensive in his apology. Defending his company, he praised the “airline crew workers [who] did their best in the face of the mishap.”
“People aren’t interested in hearing your editorial whenever you explain. Even if you’re being actively attacked, don’t be defensive.”
In the case of the Serendra incident, they explained but didn’t defend, she noted.
"What kills you under a crisis is 'brand love.' When you’re under siege your first instinct is to put up your defenses and attack whoever is attacking your company.”
“The first thing that flies out of the window during crisis is objectivity," she said.
5. Stay the course
While both companies had statements immediately following the event, they took time in releasing follow up reports.
“When an issue does happen, you need to be the first to go out there and not wait for the media. It’s unacceptable way to try and ignore it and hope no one knows. Make sure people hear from you first and not wait for someone like Father Tabora to word something strong,” said Maclang.
She was referring to Ateneo de Davao University president Fr Joel Tabora who wrote a harsh letter the day after the incident, which led to the closure of the country's 3rd busiest airport.
Tabora's letter, various social media hate posts and news reports about stranded passengers and goods continued while both companies were also juggling the impact of the crisis to their businesses. Cebu Pacific was working with the local aviation regulators to remove the Airbus A320-200 off the runway in a way that ensures the aircraft is useable again. Ayala Land was coordinating with the Roxas-led government investigation on the cause of the explosion.
Maclang said it is crucial that, in both incidents, the companies present nothing but the truth. No sugarcoating, no spinning the story. This ensures credibility, Maclang said.
The Civil Aviation Authority of the Philippines (CAAP) said they will release the result of their investigation on the Cebu Pacific Davao airport mishap in a week or two. For the Serendra blast, Roxas had pointed to gas leak as the cause of the explosion. What led to the leak and who is responsible are the goals of the next round of investigations, but Roxas was careful not to immediately pin the blame on the Ayalas.
6. Identify key stakeholders
The moments following the incident and how the company treats their stakeholders are what matter the most and companies have to react quickly, fairly and with compassion.
“Most companies think that the stakeholders that matter are those that bring in the direct revenue. A stakeholder might not have a direct contribution to our company but their thoughts and contribution might have an effect on the company,” said Maclang.
She cited Tabora and the university president's scathing letter again. Tabora asked Ateneo de Davao students to boycott Cebu Pacific due to the “insensitivity and ineptness” of its personnel.
“In the case of Cebu Pacific, if you have such an advocate like Father Tabora going out and calling for a ban of your service, that’s not managing stakeholders,” said Maclang.
CAAP, which was peppered with complaints as Davao and nearby General Santos City coped with stranded passengers and goods, had to make an ultimatum, giving the airline a final deadline to remove the airline from the runway.
In the case of Ayala Land, however, no equivalent public outcry has stood out, although other property developers shared that condominium buyers are increasingly making inquiries about the safety features of high-rise buildings.
7. Plan for life beyond crisis
There is a formula of 13/30 in crisis management according to Maclang. A company has 13 days to get away from the front page of the newspaper and 30 days to plan for business as usual.
The incidents have only been just over a week ago, but already the stories are straying from the front page. Ayala highlighted that business was back to normal at the retail outlets the day after the blast.
Crises like these spring back to life the companies' past 'sins,' and customers tend to find trends on how companies handle them.
The Serendra blast served as an eerie reminder of the 2007 Glorietta mall blast that killed 11 mall goers and injured more than a hundred. Both are properties that carry the Ayala brand and reputation.
“Ayala Land has always been very temperate and consistent on how they conduct themselves with stakeholders,” Maclang noted.
With Cebu Pacific, she noted a recurring theme of lack of good customer service.
"It may not have been the same issue, but it’s the perception that lack of sensitivity with clients seems to be a recurring issue with them,” said Maclang.
On December 23, 2009, the airline was accused of discriminating against a mentally handicapped child. It was reported that Maritess Alcantara and her son John Arvin, who has Global Developmental Delay, were asked to leave a flight because there was already a Down Syndrome child on board and it was company policy that no two special children or persons may board the same flight. After over a delay of about an hour, the Cebu Pacific crew relented and allowed Alcantara and her son to remain on board. The family got media mileage and an outpouring of sympathy when they took their story to the press.
In another incident in April 2012, wheelchair-bound Socorro Jabor reportedly crawled out of the plane because she was not aware of the P11,000 wheel chair fee.
“I don’t feel they have understood the opportunity to implement a more proactive customers service. A lot of it has to do with learning from it and make sure you can [implement the lessons] to future operations,” said Maclang.
“In the case of Ayala there could be more opportunities in being super strict in terms of securing the premise. Risk goes far beyond managing stakeholder,” she added. - Rappler.com