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Business Smart, Media Dumb

Yesterday you were a behind-the-scenes hero to your shareholders, peers, and employees. Today, the media is camped outside your door. Your 15 minutes are at hand. Are you ready?

What a difference a year makes. In December 1999, Bridgestone/Firestone Chairman and CEO Masatoshi Ono was honored as executive of the year by his industry’s bible. Rubber and Plastics News credited Ono with boosting Firestone’s sales and profits and nurturing its relationships with customers. A mere 10 months later, Ono appeared before the U.S. Senate Commerce Committee begging America’s forgiveness for dragging his heels responding to public concerns, assuming personal responsibility for the tire debacle, and promising to win back consumers’ trust. He then turned the testimony over to John Lampe-a Firestone executive who, unlike Ono, speaks English. Lampe soon found himself ensconced at the head of a tire company that had skidded off road.

While Ono and Firestone’s dilemma is extreme, complicated by the severity of a crisis blamed for more than 100 deaths, as well as language and cultural barriers, such media myopia is widespread. By necessity, CEOs are generally smart, articulate, dedicated, visionary, hard working, and self-sacrificing. But when it comes to mingling with the media, even the best and the brightest often make a muddle of things.At a bare minimum they blow their chances to tell their firms’ stories in a favorable light, to correct a wrong or negative impression, or to position themselves where they when Audi cars slipped gears and maimed people and its CEO provoked outrage by sniffing that Americans don’t know how to drive.

In 1999, when Belgian school children complained of illness after drinking Coke, Ivester flew home from Paris as planned and dawdled in Atlanta for a week. His technicians decided the problems were minor. But Belgium takes health matters seriously; its previous health minister and prime minister had lost their jobs for failing to placate the public about dioxin-contaminated beef. Ivester fared no better. After the local media blasted him as uncaring, he belatedly returned to Europe apologizing profusely for not speaking up sooner.

Ivester, who resigned as CEO of The Coca-Cola Company in December 1999, also got tarred for being out of touch with sentiment towards Coke in countries where he was trying to make deals. He saw Coke as beneficent, while foreign regulators saw it as an ugly threat to their culture. French authorities rebuffed his attempt to buy Orangina, while Mexican and Australia regulators nixed his attempt to buy Cadbury Schweppes. EU Commissioner Karel Van Miert castigated Ivester as arrogant for thinking he “could pull the wool over our eyes,” and for failing to “respect the rules along with everyone else.”

Heads in the Sand

Some CEOs dally because they don’t see a problem as significant or are reluctant to respond before a solution has been found and the problem resolved. “Many CEOs over-research and then find that they’ve missed the press opportunity,” says Marilyn Gottlieb, president of the Crescendo Group in Larchmont, NY. Or, conversely, “they’re so eager they don’t prepare for a real interview. They believe they’re too busy to need to. That often leads to trouble.”

Being caught off guard or uninformed of relevant information puts formed of relevant information puts them in a bad light. It also opens a door to embarrassing cross-examination, as when Bill Gates’ inability to remember key events during the Microsoft trial damaged his credibility.

Many CEOs approach an interview without a rehearsed message they want to embed about their companies, services, products, or goals. “They’re opinionated folks who make future predictions that come back to haunt them,” says Ries, citing Ken Olson, ex-CEO of Digital Equipment, who once publicly predicted that the personal computer had no future. “That comment caused him endless problems both inside and outside the company.”

Often a CEO gets burned by the press after revealing too much as a way to curry favor, says Jan Sneed, senior vice president at New York City-based Grey Global Group. “They don’t get that the reporters had an obligation to report on what they’d been told.”

Trumpeting good news is an easy enough task, but crises like missed numbers or a sudden scandal are the true test for a media savvy CEO. Whitewashing in times of trouble only escalates the negative impression. Yet many CEOs have a tough time coming clean about downturns. “These people are accustomed to winning,” says Spencer Stuart’s Tom Neff. “Typically, they can’t believe that when something is going wrong, it’s their fault.”

In a world where bad news travels the globe in mere moments, stonewalling is out, and full disclosure is in. “You can’t buy, sleep, or marry your way back from a lie,” says Sneed. CEOs who don’t get the bad news out all at once, “often look like they’re hiding something critical,” she adds. “They let the media control the story, rather than controlling it themselves.”

“Journalists admire executives who seem to come clean at the start of a crisis,” agrees DeVries.

Often a media gaffe is not an isolated malapropism but a reflection of an executive’s whole attitude. Conseco’s onetime CEO Stephen C. Hilbert courted disaster when, as one of the nation’s highest-paid CEOs, he repeatedly tapped the insurance and finance company for loans while entertaining lavishly in chic Bij an suits in his flamboyant Carmel mansion. The six-time husband with the celebrity lifestyle was ousted in April 2000.

Some CEOs invite press scrutiny by simply behaving badly. Herbert Haft of the Dart Group alienated reporters by firing his wife and son because he thought they were usurping his power. Apple founder Steve Jobs courted contempt by viciously berating employees in front of others.

Vindictiveness and power plays also invite reproach. After Fortune wrote what Lou Gerstner perceived to be an unflattering article, he angrily pulled IBM’s advertising.

“The prank backfired for him as it did for Mobil and Citicorp years ago,” says a marketing consultant, who notes that his behavior simply drew attention to the article and positioned Gerstner as a sulky sore loser. “Always remember the adage: ‘Don’t fight battles with folks who buy ink by the barrel.’ It mostly causes the lingering idea that where there’s smoke, there’s fire.”

While some CEOs launch their own misguided missiles, others fall victim to bad advice. “They surround themselves with yes-men who control much of what gets to them for their own private agendas,” says John Frank, Midwest correspondent for PR Week. “In a big company nobody wants to give bad news to the boss.”

Spin City Makeovers

Whatever the cause, a bungled turn in front of the cameras does not mean a reputation tarnished forevermore. In fact, memories and perceptions seemingly set in concrete can prove surprisingly malleable. Witness the reinvention of ’70s disco fever icon turned hip Pulp Fiction veteran John Travolta.

It took Travolta decades, but a business image overhaul can be had a lot faster with expert coaching and a motivated CEO. Before his recent PR-inspired makeover Microsoft founder Bill Gates was the picture of arrogant, sulking self-confidence. Critics likened him to a young gunfighter who knew he could outdraw any challenger. “Bill Gates provided a case study of what not to do on TV,” says one media trainer. He was sullen and evasive in his videotaped deposition for the government’s antitrust case and the judge scolded him for lack of candor. Even as Microsoft’s agency hustled post-trial to craft ads that created sympathy for the company, Gates blew priceless opportunities to lay the cornerstone for that campaign, says Sneed. Twice on “Nightline,” after Ted Koppel asked him how the Justice Department’s decision made him feel, Gates eschewed the opportunity to show a human side in favor of spouting corporate rhetoric. “Admitting the loss had taken a personal toll would have gone a long way in swaying public opinion,” says Sneed.

Gates has since reformed, taking a conciliatory route after feedback led the company’s PR team to suggest he behave differently. Marketing consultant Jack Trout calls the softer, gentler Bill Gates a “spin city” makeover designed to “soften his arrogant, nerdy image, to make Gates more user-friendly.”

Shortly after the court case Gates appeared with schoolchildren in Harlem, sang a children’s ditty during an interview with Barbara Walters, and got new eyeglasses and an updated hairstyle. In full-page ads he reminded America of how he and friends started the company 25 years ago with nothing but the idea “that we could harness the power of the PC to improve people’s lives” and of the benefits the company has brought to the population, industry, and the national economy.

But perhaps the most glaring media missteps in recent times concerned the tire fiasco of August 2000. Bridgestone/Firestone and Ford CEOs “created what will become a textbook case on how not to handle PR in a crisis,” says Bea Lund, president of the New York City-based Lund Group. “They’ve ignored the four basic rules: Be prepared in advance for any disaster that might occur; talk immediately to the press, have your most senior person as your spokesman, and tell the truth.”

Ono waited too long to profess his commitment to customer safety       and put that behind a business decision by phasing in a recall, says PR Week’s Frank. “And he showed the company hadn’t learned from its past.” In 1978 Firestone had to recall 14 million tires. Ono fumbled because he let the lawyers dictate strategy, says Frank.

But even playing by the PR book isn’t always enough, as Ford CEO Jacques Nasser discovered. “He told the world he was trying to fix the problem, but he didn’t come across as caring,” says Frank. Filming the commercial in question at an assembly line instead of in an office might have made Nasser seem more sympathetic. Nasser also lost points by indulging in fingerpointing-calling the problem a tire issue, not a vehicle one-when customers who buy the whole car saw it differently. “When a plane crashes the airline doesn’t try to pin the blame on Boeing,” Frank points out.

One positive result of the media mess so many CEOs have made is that others are going to school on their mistakes. They’re recognizing the need to act fast and with compassion, to nip crises in the bud, and to prepare by storing up chips. “They’ve begun reaching out to critics to avoid embarrassing environmental or safety run-ins that could wound their reputations, and training people internally to look for trouble spots,” says Frank.

Facing down a horde of news-hungry-and potentially antagonistic-reporters will never be fun. But at a time when news travels the globe in mere moments and a single mismanaged incident can snowball into an insurmountable image problem, media management is as essential for CEOs as investor relations.

As Frank points out, “The world is small and, thanks to cable and electronic means of rapidly and cheaply disseminating information, getting smaller. CEOs live in a fishbowl of accountability and exposure, where a one-time isolated story can mushroom within hours. There’s no safe place to hide if something goes wrong.”

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