How Starbucks highlighted five of the new rules of crisis management

    

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The debate swings back and forth about whether Starbucks response to events in one of its Philadelphia stores in April is good, bad or indifferent crisis management.

However, it is inarguable that Starbucks did more than most would do - and the incident and its aftermath very effectively underline and illustrate the new rules of crisis management.

The facts of what happened on April 12 now seem established.

The Starbucks store’s manager called police to arrest two black men who were accused of loitering in the store without any intent to make a purchase. One of the men was refused use of the store’s bathroom.

In fact, the business contact that the men were waiting to meet, turned up just as the police did.

Other customers recorded the whole incident on cellphone videos, including the what appeared to be white customers sitting at tables without making orders.

The videos went viral creating a social media firestorm.

Starbucks went into full crisis response mode.

The company apologized, initially via a tweet, then CEO Kevin Johnson apologized to all employees via a memo and to everyone else with a video (https://www.youtube.com/watch?v=n2bPDjPcjLk).

Subsequently the brand announced that, as a first step, all 8,000 US Starbucks stores will close on May 29 for a half-day of ‘racial bias’ training.

If we look to the eBook, ‘The New Rules of Crisis Management, published by In Case of Crisis with support from the PRSA, we can see how much of what happened during and after the events in that Philadelphia Starbucks on April 12th is a wonderful case history of the new crisis rules in action.

Here’s our take on five of the key lessons from the book:

  1. Social media is an effective two-way communication channels during a crisis (Chapter One) – The customer videos ignited the social media firestorm, but it also gave Starbucks the means to respond quickly, initially with the tweet and, later, with the CEO’s apologetic video.
  2. Organizations must remain authentic in good times and bad (Chapter Two) – Starbucks has always been proud of its progressive values, going right back to the person of its founder Howard Schultz. The brand stood by those values even to the extent of losing millions of dollars by closing the stores for training.
  3. In a crisis, employees are one of your most important audiences (Chapter Three) – If you get this right, employees will become advocates for the organization in a difficult situation. CEO Johnson was quick to send a memo of apology direct to all employees, which made it clear that Starbucks stands firmly against discrimination or racial profiling. The closing of the stores put money against that idea.
  4. It’s never been more important for communication and legal teams to work together (Chapter Four) – You must have legal support for your response, even in situations like this where a ‘legal response’ would have been exactly the wrong thing to do. Starbucks needed to show heart, emotion and its values in action, which it did.
  5. The golden rule is that every crisis plan must direct that a statement be issued within an hour of a crisis going public (Chapter Five) – This is where Starbucks could have been stronger. In fact, it did not respond until two days later with a tweet (that was also criticized for its lackluster words and tone). Two days is too late.

Download your own free copy of ‘The New Rules of Crisis Management’ at https://www.rockdovesolutions.com/the-new-rules-of-crisis-management.

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About The Author

Mike Hatcliffe is founder and president of The Hatcliffe Group, a reputation, issues and crisis consultancy. Previously, Mike spent nearly 25 years with two of the world's leading PR agencies. Most recently, he spent 10 years at Ogilvy, as managing director of its US corporate practice, and before that 14 years with Ketchum in both the US and the UK. Mike has worked on crisis and reputation assignments with a range of blue chip companies, leaders in their fields, including LG Electronics, Wells Fargo, Carlsberg, Zebra Technologies, CDW, Quintiles, Rockwell Automation, Unilever, Pepsico, Deloitte, Grant Thornton and HSBC.