Crisis and Reputation• Reputational Capital• Build through good work• Crises spend some, but how much
Attributions of crisis responsibility• Greater threat to reputation as they increase• Connection between response strategies and crisis type – Crisis types reflect crisis responsibility – Crisis response reflect acceptance of crisis
Original Dimensions• Internal-External: locus of control from Attribution Theory• Intentional-Unintentional: controllability, purposeful by an actor or not• Shape attributions of crisis responsibility
Original Crisis types• Faux Pas: interpretation of organizational behavior – Organization considers positive or neutral – Stakeholders view are negative• Accidents: things happen• Terrorism: external attack• Transgression: organization places stakeholders at risk
Original Response Strategies• Distance – Excuse: deny intention and/or control – Justification: minimize harm done• Mortification• Suffering – Organization as victim
Revised Response Strategies• Arranged from – Defensive: protect organization – Accommodative: help the victims
Crisis Responses• Deny: no connection – Denial, Attack Accuser, and Scapegoat• Diminish: reduce responsibility – Excuse and Justification – Reinforce existing frame• Rebuild: attempt to improve reputation – Compensation and Apology
Crisis Responses• Bolstering: draw on goodwill – Reminder, Ingratiation, and Victimage – Supporting strategies
Reputational Threat• How people perceive the crisis.• Strong threat requires stronger response (more perceived acceptance of responsibility)
Assess the Threat• Initial Assessment: Crisis Type• Frame used to view the crisis• Grouped by attributions of crisis responsibility – Victim – Accidental – Preventable
Intensifiers• Crisis history: similar crises in past• Prior relational reputation: how well or poorly organization has treated stakeholders
Velcro Effect• History of crises intensifies crisis responsibility• Negative prior reputation intensifies crisis responsibility
Boundaries• Financial resources are constraints – Afford the strategy?• Crisis can be frame by media (includes Internet) – May need to follow and not try to reframe
Ethical Base Response• Instructing Information: to protect selves – Warnings – Information about crisis (what happended)• Adjusting Information: cope psychologically – Express regret – Corrective action – Counseling
SCCT Recommendations1. All victims or potential victims should receive instructing information, including recall information. – This can be called the “public safety response.” – This is one-half of the base response to a crisis.2. All victims should be provided an expression of sympathy, any information about corrective actions, and trauma counseling when needed. – This can be called the “care response.” – This is the second-half of the base response to a crisis.
SCCT Recommendations3. For crises with strong attributions of crisis responsibility (preventable crises and accidental crises with an intensifying factor), add compensation and/or apology strategies to the instructing information and care response.
SCCT Recommendations4. The compensation strategy is used anytime victims suffer serious harm5. The reminder and ingratiation strategies can be used to supplement any response6. Denial and attack the accuser strategies are best used only for rumor and challenge crises7. Suffering part of response if organization is a victim
Other outcomes• Emotion (anger)• Purchase intention• Negative word-of-mouth
Example of Research in Detail:Negative Communication Dynamic
Crisis Affect• Emotions generated by a crisis – Anger – Sympathy – Schadenfreude• Anger most common (McDonald & Hartel, 2000)
Anger• Typical reaction to a crisis• Can be a catalyst for behaviors – Negative word-of-mouth – Purchase intention (Jorgensen, 1996)
Anger as Energizer• Energize people to say or write negative things about an organization/product/service• We refer to as “The Negative Communication Dynamic”
Current Focus in Crisis Communication• Crisis and impact on reputation• Limited on purchase intention• Effects typically transitory—people forget• Any effects from crisis can dissipate quickly (McDonald & Hartel, 2000)
Potential Persistence of Anger• Unhappy customers tell others (Power, 2006)• Similarly, stakeholders unhappy about a crisis and crisis management may tell others• Dissatisfaction leads to negative word-of- mouth
Word-of-Mouth• A powerful force in shaping consumer attitudes• Negative word-of-mouth more power than positive (Lacznial, DeCarlo & Ramaswami, 2001)
Lasting Effects of Word-of-Mouth• Negative word-of-mouth spreads beyond initial stakeholders – Initially tell 6 to 15 people – They in turn tell others• Negative word-of-mouth can linger – Remain on blogs, web sites, and discussion boards after initial anger subsides.
Hypotheses• H1: Higher attributions of crisis responsibility and stronger feelings of anger from a crisis are associated with higher levels of intended negative word-of-mouth.
Hypotheses• H2: Anger mediates the relationship between crisis responsibility and negative word-of- mouth.• H3: Anger mediates the relationship between crisis responsibility and purchase intention.
Results• Negative word-of-mouth and crisis responsibility correlated at .45• Negative word-of-mouth and anger correlated at .63
Results• Anger did mediate the relationships between – Crisis responsibility and purchase intention – Crisis responsibility and negative work-of-mouth
Negative Communication Dynamic Visual Representation Anger Crisis Negative WOM
Visual Representation II AngerCrisis Purchase Intention