2017’s Most Dangerous Emerging Risk Has Nothing to do with United Airlines

May 8, 2017 - Chris Britton  We all got a little pre-occupied over the past month with the compelling spectacle of United Airlines turning a tricky issue into a full-blown disaster

The noise and smoke created by the United crisis management fiasco, and the subsequent issues faced by other airlines, obscured a more interesting and potentially even more damaging source of reputation risk that became visible in the same period.

On April 3, a week before Dr. Dao became the most famous physician in the country, two separate studies were published, each with a perspective on an alarming and difficult set of issues increasingly faced by organizations.
 
What the two studies told us is that managing risk from cultural, social and political issues is becoming a huge challenge for organizations.
 
One of the studies was from the thought leadership unit of the marketing agency McCann, The Truth about America.  

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McCann highlights how the rising political divisiveness in America and the sharp divide between liberals and conservatives deeply affects perceptions about values, institutions, brands, foreign countries, American symbols or news sources.
 
McCann’s press release said, “The bitter divisiveness and partisan disputes about truthfulness that have come to characterize today’s political environment are also affecting other aspects of American life, including attitudes about brands and core values”.
 
It is always a careful walk when brands and companies make judgment calls and get involved in issues around race, gender, nationality and politics—but never greater than right now in divided America.
 
The second study was The Institute for Crisis Management’s (ICM) annual crisis report, which tracks six hundred thousand crisis stories in the news worldwide.
 

Mismanagement (malpractice, misconduct, negligence, unethical practices, and so on) was top of the charts, accounting for nearly 30 percent of crises.

But look what was number two on the list with a bullet.

Discrimination stories skyrocketed to around 20 percent, with ICM’s report citing news articles involving Papa John’s pizza, the restaurant chain Noodles & Co and the North Carolina bathroom bill.

By comparison natural disasters accounted for just one percent of crisis stories in 2016—and stories about data breaches just five percent.

One of those issues around discrimination tracked by ICM, the North Carolina bathroom bill, was the reason the retailer Target published a blog post in April 2016 welcoming transgender employees and customers to use the restrooms and fitting rooms corresponding to their gender identities.

The blog was only confirming what was a long-held practice at the stores. It should not have been that controversial—but it rapidly became so.

The Wall Street Journal recently took a look at the issue one year on and concluded that nothing much had gone to plan:

“Other retailers have similar policies. But for Target, the posting of what was its long-held practice quickly became an expensive and distracting lesson about the perils of combining the web’s megaphone with touchy social issues.”

Target faced an avalanche of criticism from groups opposed to the policy.

Equally, it won support from advocacy groups on the other side of the issue.

But don’t think you can avoid cultural risk by doing nothing. Consumers have taken that option off the table.

Earlier this year, the marketing behemoth Unilever unveiled an international study that showed a third of consumers buy brands that can demonstrate a social and environmental impact.

In 2016, the BBMG agency identified a sector of the buying public it calls ‘Aspirationals’, a consumer demographic it claimed represent 40 percent of the global public. Aspirationals are defined by their love of shopping, desire for responsible consumption, and their trust in brands to act in the best interest of society.

So, damned if you do, damned if you don’t.

What does all this mean for you in your role as a defender of your organization’s reputation?

Take a look at your crisis planning.

How well does it equip you to manage these kinds of issues?

How well would you respond in this type of crisis?

What inputs and counsel can you call upon to overcome lurking cultural blindness?

When you access your plan on your crisis mobile app and you have to react at social media speed, you will want to know that these questions have been answered. 

 

Originally Posted by Bulldog Reporter