Putting Out The Fire: When A Crisis Occurs

Crisis
Management
in the World
of Food
Borne
Illness

Pamela J. Ritz, ARM, SPHR, CRM, HACCP
President
Specialty Risk Management, Inc.
®

May 16, 2008

SRM has created a closely integrated
team with expertise in the areas of:

– Food Law
– Public Health Law
– Communicable
Disease/Pathology
– Product Recall
– Media
– Marketing Response
– Customer Response
– Employment Practices
– Business Recovery
– Contracts
– Insurance

© Copyright All Rights Reserved SRM, Inc. © 2008

Prevention
• 100% of our
prevented cases
happen within a
matter of hours of
the first Health
Department
contact
• However, 5% slip
through to
“public/media
events” … TIME IS
OF THE
ESSENCE!

Presently 11,000 to 12,000 Interactions per
Year on “Media”-Based Events

Food Borne Recall Summary
Illness Manufacturers
1997 - 2008 2002 - 2008 • 41% Customers
• 38% Company Crisis
Management
• 6% Insurance Carriers
• 4% Health Department
Interactions Interactions • 5% Media
• 3% Medical
73,937 4,328 • 2% Law Firms
• 1% Lab


Food Borne Crisis – “Plug In”
Public
Marketing
Relations
Internal or
External Human
Goals
Resources • Integrate
• Take on
character of
Quality company
Assurance/
Health
Risk • Uniquely
Management/
Department
Insurance
mold to each
Carrier(s) event
Restaurant • Be invisible
Management Corporate
Management
• Earn our
place
Increase Effectiveness

1. Current Trends –
What’s Hot Now
2. Prevention / Control
3. Controversial –
“Pammie Dearest’s”
Future Predictions

Current Trends -
What’s Hot Now

Even If You Are Doing Everything You Can to
Monitor your Employee’s Health and Exclude any
Symptomatic Employees …

Scenario:
A “Regular” customer (retiree)
walks into your restaurant and
seats himself at his usual table.
On his way, he stops to grab his
own silverware accidentally
touching other pieces of
silverware. Little does he know he
is a carrier of Norwalk virus …

He visits with his favorite wait staff.
She has been an acquaintance
and server for almost two years.
He finished his meal and she clear
the dishes while serving his final
cup of coffee…

Illness is Building …
HD - Slow to Respond …
• Week 1 (total of 9 ill guests, 1 ill employee)
– Sunday: - Customer infected with Norovirus eats at restaurant
– Wednesday: - Server calls in sick
– Thursday: - Server returns to work
– Saturday: - 8 guests eat – sick within 48 hours (Server working)
• Week 2 (total of 45 ill guests, 13 ill employees)
– Sunday: - 14 guests eat – sick within 48 hours (Server working)
– Monday: - 3 employees call in sick
- 3 guests eat – sick within 48 hours
– Tuesday: - 6 employees call in sick
– Wednesday: - 2 employees call in sick
– Thursday: - 9 guests eat – sick within 48 hours
– Friday: - Employee calls in sick
- First inspection related to customer complaints –
HD gets involved
– Saturday: - Employee calls in sick
- 13 guests eat - sick within 48 hours

Warning Signs are often missed…
• Week 3 (total of 24 ill guests, 2 ill employees)
– Sunday: - 9 guests eat - sick within 24 hours
– Monday: - SRM receives call from restaurant for help
- 1 employee calls in sick
– Tuesday: - 1 employee calls in sick
– Wednesday: - 4 guests eat – sick within 24 hours
– Thursday: - 1 guest eats – sick within 24 hours
– Friday: - 3 guests eat – sick within 24 hours
- Confirmed death from complications
- Restaurant closes
– Saturday: - Media circus begins
- Intense cleaning
• Week 4
– Sunday: - Intense cleaning
– Monday: - Re-inspection
– Tuesday: - Re-opened restaurant

100 sick 8 hospitalized 1 death

“Laissez Faire” (hands off)
Health Department – Hep A
• Friday, 5 p.m.: Health
Department Press Release
Scenario: – “The County Health Department has
Employee travels learned that a worker with confirmed
internationally – infectious Hepatitis A worked while
unknowingly ill at “our” restaurant.
exposed to Hep A – People who dined at this restaurant
between March 14 and March 25
contact their local Health
Department or healthcare provider
for assessment and vaccination.
– A vaccination clinic will be set up
next week. It is strongly
recommended all over 12 months
obtain the vaccine.
– Symptoms for Hep A are …

Media Nightmare Cycle & Upset
Customer Eruption
• Week 1
– Friday afternoon
• 5:00 - Press Release – Health Department goes home
• 5:30 - 60 phone calls to restaurant
• 6:00 - Local news continues
• 7:00 - Calls from weekend reporters
• 8:00 - Cameras rolling in parking lot
• 10:00 - Return calls to local media complete
– Saturday
• Customer hotline running
• Customers (eating 14th, 15th, want testing and shots)
• Health Department available for one (1) call Saturday with
company – vaccine / IG harder to find than realized, maybe no
clinic or maybe Wednesday
• More cameras rolling out front
• No private physician has vaccine / IG
• All employees inoculated/tested

– Sunday – Private clinics established by
restaurant for testing/shots
– Monday (within 48 hrs)

The rest • By 8:30 a.m. 2300 customer calls over
weekend
• Media stories Monday

of the – Tuesday
• Starting arrangements for >155 customers

story…
shots from California, Canada, Florida – 22
states total
• Media stories Tuesday
– Wednesday
• H.D. slates one day for shots – only 1000
shots available – run out in a matter of hours
9,700 Total Interactions
• Stampede of customers as they rush to
private clinics for shots – only to wait for hours
No restaurant closure! due to long lines – “standing room only” –
“wall to wall” people
• Media (big) – “not enough shots”
85% in revenue – Thursday - Customer calls – follow up
– Friday – Customer calls – follow up
1 employee ill
• Week 2
No other employees (ill)
– Saturday
No ill customers • Health Department gives another 250 shots
• Customers also want testing

HD / Media Problems We
Currently See…
• Customers hear “Hepatitis” or
“Norovirus” – demand treatment
• “Fecal/oral” route stalls business
• Workers with Hep A “worked
while ill” (customer anger)
• “Contact your local Health
Department or Healthcare
Provider – You’re Exposed”
• Delayed response after press
announcements – 5 to 7 days
even in a pro-active HD setting
Copyright © 2008 SRM , Inc. and its licensors. All rights reserved.
®

Crisis Management Environment
• Friday night press releases – weekend
catastrophes
• Coordination of nationwide needs
• Availability of “serum”
• Testing/treating your own employees –
pre-requisite for restaurant re-opening
• “Cash strapped” Health Departments are
charging for services

®

Dollar Costs to the
Community…or will it be you?
• Scenario: Patrons wait 3 hours
for Hep A inoculations
– **“One elderly woman fainted in
line and was taken to a hospital”
– **“’They expected several
thousand people, but it looks like
half of Arlington is here’, said
Wayne Springer, the deputy fire
chief.” • Customers expect
• Total Inoculations treatment
Given (2 wks customers): 3800 • Insurance carriers
• Cost per Inoculation: x $35-$75 may not cover
• Total Cost of
• “Tax Dollar
Inoculations: $133,000-
$285,000 Expenditure” outrage

** As reported by The Boston Globe, 6/19/04 ®

Health Departments may Regulate
our Restaurants but …

Public Health Law mission statement:

… The board shall exercise its power in matters
relating to protecting the public health to prevent the
introduction of disease into the state… including
anything necessary or expedient to promote health
or suppress disease…

No thought for revenue/expense impact
No after-hours/weekend support
Law allows unlimited use of media
®

Public Health Varies by State -
Will Impact Your Event

Tennessee Georgia California New Jersey

3 Regions Single Strong Cities +
Coordination Overlapping
– not a “Agencies” Divided by
“Monolithic” County
Force

®

American’s Demand Healthcare
Increasing Phenomenon
• Most don’t know personal vaccine history
• Want to be tested or treated
• Internet tells them about disease / treatment
• Customers want a place to go for help –
immediately
• “High end” customers – demanding
• “Inoculations / vaccine” not on hand at
treating physicians
• What are you going to do?
®

Our First Hurdle Towards
Rebuilding Business Traffic

Customers want: Business
Attention Recovery Efforts
Treatment
®

After the Initial Shock of Media Events the
Issues of “Liability” and BI Intertwine

The longer an
Business Insured
Income recovery remains as a
requires source of
“getting out” “public
of the public contempt” the
consciousness longer the BI
event


It’s Simply Enough…
Restaurants and hospitality are uniquely
vulnerable to any one of the 35 reportable
diseases

Sick Employee Health
Restaurant
Treatment Doctor Department
Report

Cycle is Defined by Law


Commonality is Enough to
Generate a Health Department
Investigation

Doctor
Sick Customer
Report
Treatment
Doctor
Sick Customer Report Health Common
Treatment Department Restaurant

Sick Customer Doctor
Treatment Report

Restaurants are vulnerable to special risks
®

The 1999 Federal Food Code
Transferred all Responsibility to
the Restaurant Manager
• Managers are expected to know:
– Any employees diagnosed
– Any employees with symptoms
– Any employees previously ill
– Any employees with sick family members or who
have recently traveled outside U.S.

Hepatitis, Salmonella, E-Coli, Shigella were the
focus (Employees as ‘Carriers’)
®

The Big “5”

2005
• Federal Food Code changed
• Laboratories upgraded
• New abilities to diagnose
• “Old Disease” will look like a “new”
problem
• Most common Media events
®

Public Health Science v.
Traditional Product Testing
• Expectation – “food is long
Public Health gone” – illness onset time
periods
• No actual contaminated food
Food is required to complete
investigations
Borne • Food testing advances may
not even address (especially
Illness virus)
assumes: • Food Code changed in 1999
& 2005
you should be there
®

PFGE Patterning / RNA Sequencing
Technology is Catching Up

• Health authorities using
science of “victims” and
statistics
– Homeland Security money
has dramatically improved
state labs
– “Pulse Net” now tracking all
pathogens - E. Coli,
Shigella, Salmonella, Hep A
– States now ID Norovirus
®

Complications – Compressed Operating
Environments for Restaurants
• Enjoying recent abilities to “Send
negotiate insurance premiums
Money”
• Property/casualty coverage
must be “tested” for
“restaurant” industry readiness
• Lawsuits – sick customers
don’t help – media impact
• Standard carriers don’t have to
pay for your business losses

®

Smack Down (pleeeeaase)

• “I cannot comment on
matters involving
litigation” – COME ON!
• Give American people
some credit
• “We have given
individualized attention
to each and every
customer – there has
never been a need to
file a lawsuit.”

®

Radical Legal Principles in Food
Borne Illness Events - Product Liability
• Customers are entitled to “actual
damages” under strict liability law
• You can “render aid” during
ongoing investigations without
“admitting liability”
• There will always be a “written
report” by Health Department
• Enough science to rule out most
“fakers”

®

Prevention: (Actual Event)
The Phone Rings
“We have taken
samples from your
ice machine along
with other
restaurants in the
city. We found
coliforum counts. Do
you have any
comments?”

Creating the
“Ick” Factor
Thru “Junk
Science”

• Making news on a slow
day…
– Health Department is not
involved
– No customers have
complained
– Now what?
© Copyright AllAll RightsReserved SRM, Inc. © 2008
© Copyright Rights Reserved SRM, Inc. © 2008

Can the media just say
anything they want to?

No!!
No!!
You still can’t yell fire in a crowded theater

There are Laws that Govern
the Publication of Information

• “Libel law” - basics
still apply
• “Truth” is the
media’s only
defense
• “Privacy” is another
barrier


Reporters Think About the Factors
that “Ping” the Ear of the Public

• Am I affected?
• Unknown effects
• Caused by employees
• Caused by restaurant
• Companies we know
Media reaction /
• Children, elderly, pregnant
consumer fear
women
angles
(death or injury)

Media Prevention Work Means
Playing a Game of “Brinksmanship”

• Don’t drop into media
training here
• Dialogue – chat only
• Stay in touch (you’ll have
another opportunity …)
• Do the science (internally)
• If you comment - it becomes
the “truth”

Return Call to Reporter…”Let’s
Test Your Science…Buddy”

• So I know that there are natural coliforum
counts in public water supplies – how does
ours compare?
• “We will want to test, too. Let me compare
processes – water testing requires sterile
containers obtained from labs with time
periods strictly maintained for submission.”


Goal: Prevent our Brand Name from
Being Mentioned – or Article Published

OUTCOME

NO MEDIA EVENT

The Weight of “Truth” –
Prevention Strategy for “Brand
Impact” Protection
Be prepared - 2008 Junk Science Trend

• Coliform Bacteria
• “Aerobic Plate Counts”
• Fecal Coliform


We Slip into “Media” Training
Sometimes too Quickly
• There is a natural
“surface tension” in any
news story called “truth”
• If you break it with
volunteered information
– “game’s on”
• Don’t remove the
“burden” of truth in how
you interact

“Privacy” has Some Strength
as a Tool in Brand Protection
• Customer calls the
media with a report of a
food borne illness
• Reporter calls – “Would
your restaurant like to
comment?”


Truth – In the “Food Borne Illness”
World it means Health Department
Involvement

• Discipline
– “I’d love to talk with you
… have you talked with
the Health Department?
Who (name)?”
– “What did they say?”
– “Can I call you back?”


Switching Gears:
Basic Truths During any Food Borne
Illness Event – Public Events
• Must know / understand the
Health Department message
first
• If there is a message – they
must know your plan
• Health Departments now have
PR spokesman – you have to
seek them out during events
• If there is no ongoing
investigation, then there is NO
© Copyright All Rights Reserved SRM, Inc. © 2008validated illness © Copyright All Rights Reserved SRM, Inc. © 2008

The Majority of Your Time is Spent
on Advertising and Branding

• For our brands – it’s “reflex” now
– Reach
– Spread
– Surveys and analysis
– Who “we” are, what “we” serve, who
buys our “stuff” (inside Brand
Loyalty)


We Know Who and What we are
(Reacting to “Pain” or “Reality”)
• It’s just painful to hear / see:
– “Popular local eatery sickens
hundreds”
– “Tune in at 6 – eating at the most
popular place in town could just be
your last meal”
• Your officers are mad
• Your largest investors are
shocked
• Your founder wants to fight back

Internal Communication is also
Important
• Food borne illness
media events will
impact our sales
• “Responding” is a
long term
commitment = .
day/week/months
• Measure financial
impact in context
• Yes - It will cost us
money

How to Handle the Media –
Books are Written about it
• There is no magic “structure”
• Too often we think:
– Being “open” or “available”
– Get our “media trained staff” out
there
– Interviews at the restaurant
– Get the press releases
out far and wide

© Copyright All Rights Reserved SRM, Inc. © 2008 © Copyright All Rights Reserved SRM, Inc. © 2008

Non-Traditional Marketing /
PR
• PR’s role is shaped everyday by the crisis
management meeting
• You will be learning “technical” knowledge
during an event
• “Get in” and “get out” of the press for a
reason
• Control your “reach” and “spread”
• Prevent it if you can, of course

Technology in U.S. gives us some natural
limitations on “who hears story”
Broadcast Bands License for a “Fixed” Distance

Impact restricted to “need to know area” for mandated action

Financial Results - Not Brand
Surveys
$60,000 $60,000

$50,000 $50,000

$40,000 $40,000

$30,000 $30,000

$20,000 $20,000

$10,000 $10,000

$0 $0

Affected Location Nearby Location
$60,000 $60,000

$50,000 $50,000

$40,000 $40,000

$30,000 $30,000

$20,000 $20,000

$10,000 $10,000

$0 $0

Other Location Other Location

Year to Year Revenue of Location Tells us How to
Rebuild Business Copyright All Rights Reserved SRM, Inc. © 2008
©

It is Always a Shock –
But Success in Crisis Management is
Measurable
Success is… • Minimizing the financial drop
• Limiting the spread
• Focusing on how fast we recover

Actions
Affect
Recovery

SM

Crisis Management is About
Continuously Affecting/Reducing Loss
– Mentally Prepare Yourselves

Food Borne
Illness Event Business Response
Plans - Integrating
Gov’t Control / Marketing Concepts
Pathology to Increase
Dialogue Business Flow

Immediate
1-800 Customer
Response Reduce
Media

Gov’t Control /
Pathology
Dialogue

Integrated Effort/Expertise

Controversial
“Pammie
Dearest’s”
Future Predictions

History:
CDC Data 1996-2006 10 YEARS
“Supplier Events” “Restaurant
Caused Events”

66 Events 6,000 Events

8,520 258,168
Customer Illnesses Customer Illnesses

Current Pre-Occupation with “Supply Chain” Issues

“E-Coli Lawyer Cleans Up, Makes
Good Money from Bad Food”
(article from Associated Press 2/5/08)

Highest Plaintiff
Attraction -
Restaurant Events
+
Supplier Issues


Science is tightening the noose
Salmonella Reduction Initiative
Salmonella Reduction Initiative
2008 FSIS //FDA Initiative
2008 FSIS FDA Initiative
CDC Posting
PulseNet Comparisons

PFGE PFGE

Factory Human Illness /
Product Sampling Outbreak Sampling

We have to think about more seamless
approaches to “worst case”
• Collision course:
– (BI) Insurance agents pushing for risk transfer
for financial loss
– (GL) Insurance agents pushing for risk
transfer for liability loss
– Corporation is pushing coverage and low cost


Think About the Worst Case
Death – Disability – Customer Injury

We want our suppliers sitting
beside us at the Defense Table

What if we are suing them for
recovery at the same time?

Any Loss Any Supplier Loss
Transferred to Transferred
Insurance will
Mean Lawsuit Insurance
Carrier

Recovery /
Subrogation
Your
Company
Subrogation
Lawsuit

Supplier


100% of all Food Borne Illness
Restaurant Outbreaks Result in
Inspections

• Health Department
Inspection
• Public Information
Critical Violation
– How much are you at
Critical Violation fault?
Critical Violation – What ammunition will be
in Health Department
investigation?


Media Nightmare – Disclosure and
Managing conflict in the media eye.


We Know How Product Liability
Law Works – Lock Attorneys in a
Room

Contracts
Decide Work
How do we
Backwards
want to defend?


Back to Basics - Contracts
• How do we want to do business anticipating
liability?
• Car companies went through the same cycles
• What media agreements are integrated into
contracts?
• Some suppliers are our only source
• How do we both survive?
• QA, Purchasing, Risk Management & Public
Relations – joint project

THANK YOU!

Pamela J. Ritz, ARM, SPHR, CRM, HACCP
President
Specialty Risk Management, Inc.
®

May 16, 2008

Putting Out The Fire: When A Crisis Occurs

Recommended

Recommended

More Related Content

Similar to Putting Out The Fire: When A Crisis Occurs

Similar to Putting Out The Fire: When A Crisis Occurs (18)

More from National Restaurant Association

More from National Restaurant Association (20)

Recently uploaded

Recently uploaded (20)

Putting Out The Fire: When A Crisis Occurs