McCluskey 1

Kristy McCluskey
Dr. Paul LeSage
Public Relations and Crisis Management
December 14, 2010

Crisis Management: Lessons from Corporate Crises

Some corporations spend millions of dollars on crisis communications plans, while

others, certain that they will never be confronted with a full-scale crisis, completely ignore the

subject. History has shown that no company, corporation, or public figure is free from the danger

of a crisis, for issues can arise in even the most efficient businesses. It is essential that companies

and public individuals respond to a crisis with a carefully constructed crisis management plan.

While it is wise for those plans to be in place before a crisis even occurs, a company can recover

from a crisis with a plan constructed in response to a crisis if that plan addresses the essential

components. Effective crisis communication isn‟t about winning or even about turning a bad

situation into a good one, but about knowing how and when to respond to a problem in a truthful

and forthcoming manner (Adubato 7). Crisis communication involves minimizing damage and

encouraging public support.

Corporate responses to crises in the past three decades have demonstrated the importance

of truthful communication that gains public‟s respect and the destructive consequences of denial

or refusal to accept blame. The 1982 Johnson & Johnson Tylenol tampering case involved a

corporate response that demonstrates all the crucial components of a successful crisis

communication plan, while the 1989 Exxon Valdez oil tanker spill “remains a prime example for

how not to handle a crisis” (Adubato 20). Rudy Giuliani‟s response to the events of 9/11

demonstrates a superb balance between strong and compassionate communication, while Dick

Cheney‟s silence following a hunting accident in which he shot a friend “just might be the
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dumbest communication decision in recent history” (57). Each of these companies and public

leaders were confronted with a potentially devastating crisis, and the manner in which they

responded proved to make or break the presence of public support.

Steve Adubato, author of What Were They Thinking? Crisis Communication: The Good,

the Bad, and the Totally Clueless, wrote that “the way CEO James Burke of Johnson & Johnson

handled the Tylenol tampering case in 1982 continues to be the gold standard in crisis

communication” (3). He called the negative publicity that surrounded the seven deaths linked to

cyanide-laced Tylenol “a seemingly insurmountable PR disaster” (13). Advertising expert Jerry

Della Femina said, “There may be an advertising person who thinks he can find this and if they

find him, I want to hire him, because then I want him to turn our water cooler into a wine

cooler,” (Kaplan 3). But Johnson & Johnson didn‟t just survive that negative publicity—it

enhanced its public image with its swift and honest communication with the public.

Johnson & Johnson did not have a crisis communications plan, but Lawrence G. Foster,

its Corporate Vice President at the time of the tampering, said that no crisis management plan

could have prepared for such a tragedy. However, the company did have a credo written by

Robert Wood Johnson, who had lead the company for 50 years. “Johnson saw business as having

responsibilities to society that went beyond the usual sales and profit incentives,” (Kaplan 7).

The company‟s president at the time of the tragedy, David R. Clare, said that “the credo

prompted the decisions that enabled us to make the right early decisions that eventually lead to

the comeback phase,” (7).

The window of opportunity to gain public support is a narrow one, but one that Johnson

& Johnson was determined to gain access to. Using the credo as guidance, the company

developed a crisis communications team and appointed a leader within hours (Adubato 13). The
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team immediately decided that “full and timely disclosure was critical to surviving [the] crisis,”

and was consistently up front, honest, and accessible to the media and the public (13). Johnson

& Johnson immediately recalled all Tylenol capsules from Chicago, where the first deaths had

occurred. The move demonstrated that protecting the public was the company‟s top priority,

despite the tremendous cost that such an action entailed. Johnson & Johnson‟s efforts were

estimated to cost $100 million, but the crisis management team focused on the company‟s long-

term reputation rather than immediate financial concerns (15).

Examinations of the recalled capsules uncovered two capsules that were laced with

cyanide. Johnson & Johnson responded by identifying, communicating with, and responding to

its most important stakeholders, which included the news media, the general public, employees,

and medical professionals. Company CEO James Burke immediately held a press conference to

distribute the information while the crisis communications team “sought high-profile network

opportunities… on such programs as 60 Minutes [and] Nightline,” (Adubato 14). The company

took out full-page ads in major newspapers nationwide to inform customers that they could

exchange Tylenol capsules for Tylenol caplets, which were not affected by the crisis. Johnson &

Johnson set up a twenty-four-hour hotline staffed by medical and health experts to answer

questions related to the crisis (15). These moves demonstrated that “the company‟s top priority

focused on warning the public about the dangers that might exist,” (Adubato 14). Burke held

forums with employees in which he kept them updated, answered their questions, and

encouraged them to pass the information along to friends and family (15). The company notified

the FDA and sought the assistance of the FBI, a move which “secured their place as an aggrieved

party seeking justice in [the] tragedy,” (15). It sent medical professionals information as it
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became available, which proved that the company was sympathetic to the overwhelming number

of questions and concerns the medical professionals were bombarded with.

Johnson & Johnson‟s “we‟re all in this together” approach solidified its position “as a

corporate „victim‟ of some sick, dangerous killer” and allowed the company to gain the trust of

the news media and the general public (Adubato 16). The company‟s repeated efforts to

communicate openly and honestly with the public gained it such respect that when the company

did make mistakes during the crisis, the mistakes did not prove to be devastating. When the

Associated Press heard that there was cyanide in the manufacturer‟s plants, despite official

statements that said otherwise, it contacted Foster, who was the chief crisis communication

spokesperson (16). Foster investigated the concern and discovered that a small amount of

cyanide was used for quality-assurance testing, but in a facility separate from the production line.

He reached out to the Associated Press to clarify the situation, which solidified the company‟s

trustworthy and reliable reputation. As a result, most media organizations agreed not to run the

story, and when the New York Times did run the story, Johnson & Johnson “was not portrayed as

the corporate villain,” (17). According to Adubato, “Foster‟s solid reputation and track record

with the media was paying off,” (17). In fact, the media “praised [Johnson & Johnson]… for

their socially responsible actions,” (Kaplan 4).

Many public relations professionals “attributed the success of the comeback to the quick

actions of the corporation... If Johnson & Johnson had not been so direct in protecting the public

interest,” the outcome of the crisis would have been much different (Kaplan 5). The Tylenol

crisis demonstrated the importance of a solid crisis communication team, of acting quickly and

openly, and of identifying communication systems that encourage dialogue between the

company and key stakeholders (Adubato 18). The crisis showed the positive effects of seeking
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out media outlets and of acknowledging and apologizing for mistakes. These actions help to

build goodwill that the company can cash in on later. Johnson & Johnson demonstrated that “it‟s

not what happens, but rather how you deal with it, that matters most,” (19). Public relations

experts consider Johnson & Johnson‟s response to the crisis to be one of the best in the history of

public relations, and the response has certainly made a lasting impression in the realm of crisis

communications (Kaplan 3).

Officials at Exxon Corporation also made a lasting impression in the world of crisis

communications, but their examples demonstrated what companies should not do when faced

with a crisis. On March 24, 1989, the Exxon Valdez oil tanker hit submerged rocks when its

captain placed the tanker in the hands of an inexperienced third mate. The rocks ripped a hole

almost the length of the ship. Eleven million gallons of oil spilled into Alaskan waters, which

created a 1,3000-square-mile oil slick and claimed the lives of 100,000 animals (Adubato 20).

The media distributed “graphic images of devastated wildlife” to the public, while

Alaskan fisherman “accused Exxon of destroying their livelihood,” (21). The public looked to

company officials to explain what happened and to make amends. Exxon needed to swiftly

address the public with empathy and compassion. But the company‟s actual response was

“pathetic,” according to Adubato. The company focused its resources entirely on the operational

side—the cleanup—for company officials believed that by cleaning up the spill, they could clean

up the public relations fallout (21). But a quick cleanup was impossible; it took ten years for

scientists to conclude that Prince William Sound was even relatively normal.

Ten days passed before Exxon publicly responded to the crisis, which came in the form

of newspaper advertisements. The advertisements announced Exxon‟s commitment to cleaning

up the spill, but made no acknowledgement of fault, nor an apology (Adubato 22). In fact,
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company officials made every attempt to blame others. In an attempt to minimize the extent of

the problem, officials implied that environmentalists and the media were exaggerating the

severity of the situation (21). Exxon President Lee Raymond even told ABC news “that he

blamed „ultimately the Coast Guard‟ for delaying the use of dispersants,” (22).

The lack of a crisis management plan—or even a strong leader—made a bad situation

worse for Exxon. CEO Lawrence Rawl “made the fatal mistake of delegating all significant

communication responsibilities to his PR team,” (Adubato 22); the ever-changing spokesperson

portrayed an image of a weak, disorganized company. Rawl reluctantly gave an unemotional

video statement which “communicated little if any empathy and compassion for those whose

lives and livelihood had been devastated by the Valdez fiasco,” and cited feeling

“technologically obsolete” as his reason for not reporting to the scene of the disaster (22). His

actions repeatedly communicated that he had no understanding of a CEO‟s responsibilities

during a crisis; it took three weeks of constant criticism for Rawl to even visit Alaska (23).

Paul Shrivastava, director of the Industrial Crisis Institute at the time of the Valdez crisis,

said that “all crises have a window of opportunity to gain control of 34 minutes to 12 hours,”

(Adubato 23). Rawl evidently did not understand how crucial a swift, compassionate response

was to recovering from the crisis. Exxon waited ten days before distributing newspaper ads and

three weeks before sending to the scene of the disaster a CEO who lacked communication skills

or empathy. The public was clearly not happy: many joined together to boycott Exxon and

demonstrated their displeasure by cutting up their Exxon credit cards (24). Years later, Exxon

Shipping Company President Frank Iarossi said, “Exxon is a very, very proud company that has

done a lot to protect the environment… the public‟s reaction… is totally irrational,” (24). But his
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statement only gets worse: “how much good is this really doing? We‟re not willing to make [the

commitment] to go anywhere and do anything anybody says,” (24).

The lack of effort Exxon was willing to put in was quite clear, though evidence shows

that an empathetic and timely response could have minimized the public relations fallout. Exxon

was going to take a hit no matter how it responded. However, the key to a solid crisis

management communication is to plan a timely and personal response as a means of minimizing

the fallout. Exxon needed to send representatives to Alaska immediately, to communicate

compassionately and empathetically with the public, and to acknowledge responsibility in the

crisis. Had these actions been taken, it seems that the company could have recovered from the

unfortunate incident.

Perhaps one of the most devastating aspects of this crisis is that Exxon had taken the first

step in being prepared. It had a 250-page containment plan that detailed the appropriate response

for responding to spills in Alaska (Adubato 25). However, the plan was ignored when the crisis

hit, in part because those in charge were unfamiliar with how to implement the plan. Exxon

tackled aspects of the crisis as they developed and unfortunately, “CEO Lawrence Rawl‟s

delayed response, bumbling comments, insensitive actions, and shift-the-blame accusations set

Exxon up for a corporate disaster,” (24).

In the aftermath of the attacks on 9/11, the public needed a public figure to whom it could

look to for hope and direction. In an example of “crisis communication… par excellence,” New

York City‟s Mayor Rudy Giuliani became that person (Adubato 90). Giuliani reported directly to

the scene of the attack on the Twin Towers, where he appeared “fully engaged. Hands on.

Talking to first responders. Walking just a few blocks from the flame-engulfed Twin Towers,”

(91). Giuliani gave a live telephone interview at 10:51 a.m., just two hours after Flight 11 hit the
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North Tower, and held his first official press conference at 2:35 p.m. with his aides available to

provide specific information. “No detail was too small. No question was off limits. Giuliani was

calm, confident, clearly focused, and most of all, in control,” (93).

Giuliani‟s superior, Governor George Pataki, stood behind him during the press

conference. Though Pataki politically outranked Giuliani, Giuliani appeared to be the man in

charge (Adubato 93). He presented himself as a “strong leader, capable of providing comfort and

emotional and psychological support to millions through his unscripted and clearly heartfelt

words,” (93). Communication needed to strike a balance between “hopefulness and candor,” and

Giuliani‟s speech achieved just that balance. Giuliani gave the public hope and a sense of

direction without “sugarcoat[ing] the horrific and grim reality and ultimate challenges and hurdle

to be faced,” (92). He attended countless funerals and public memorials in the wake of the

attacks and always seemed to find the right words and tones for grieving families and fearful

citizens (94). He was widely praised, even by his harshest critics such as Wayne Barret, who

wrote that “While George Bush was making America wonder who was watching the store…

[Giuliani] lead a masterful performance that left no one in doubt that New York City, at least,

was in strong hands,” (92). Mark Green, a New York City mayoral candidate who had never

been a fan of Giuliani‟s, said, “I can see some public officials overplaying the tough card…

but… he struck just the right chord of toughness and compassion,” (96).

Giuliani‟s response to the attacks on 9/11 were not without criticism. He was publicly

criticized for not ensuring that fully functional two-way radios were given to firefighters,

especially since radio communication failure had a deadly, devastating effect on 9/11 (Adubato

94). His decision to house New York‟s emergency command center at World Trade Center

Building 7 was questioned, since the location had been a terrorist target in 1993 and ultimately
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fell on 9/11 (94). Some wondered if Giuliani made enough of an effort to encourage rescue

workers at Ground Zero to wear protective masks. But most of these mistakes were tactical and

operational, and were overlooked because his communication strategies made him an

inspirational leader. Giuliani‟s response to the crisis gave “a unique view of the power of well-

executed crisis communication: it is the strongest weapon we have… when we need to move,

inspire, and give hope to others,” (95).

Unfortunately, Giuliani allowed the praise to affect his actions. He was criticized for

exaggerating the dangers he had faced, and became involved in a verbal battle with NYC

firefighters who believed he was exploiting his efforts on 9/11 for political gain. As a result,

Giuliani‟s reputation as a “masterly communicator” suffered, which demonstrates “how easily

and quickly poor communication skills can tarnish the image of an exceptional crisis

communication leader,” (Adubato 100).

Fortunately for Giuliani, the public did not forget his masterful communication skills

when the nation looked to him for answers. According to Adubato, “great leaders remain calm in

the face of the worst crisis—even when they themselves are experiencing fear of overwhelming

emotion,” (102). Giuliani certainly did just that. David Letterman described him as “the

personification of courage,” and was brought to tears during the lengthy standing ovation the

mayor received on the show a week after the attacks (96). A New York Post editorial declared

Giuliani “A Mayor for Crisis,” and wrote that in his FDNY baseball cap and EMS windbreaker,

“America and the rest of the world saw a visible symbol that New York had not been defeated by

the attack. That [was] his finest hour,” (96). Giuliani set a standard for crisis communication

leadership “the remains untouched by any public or private sector leader,” (97).
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Dick Cheney‟s communication skills in the face of a crisis were in stark contrast to

Giuliani‟s. In what Adubato terms “the dumbest communication decision in recent history,”

Cheney‟s lack of communication caused a simple accident to transform into an image crisis (57).

On February 11, 2006, Cheney accidentally shot his friend Harry Whittington while the two

hunted for quail. Cheney‟s lack of response to the event caused it to become a full-blown crisis.

Cheney first communicated with the White House 24 hours after the incident, when he

called the Chief of Staff, Andrew Card, to tell him about the shooting. But he didn‟t explain how

Whittington had been shot. “At that point, even those in critical communication positions in the

White House were left in the dark by the vice president,” (Adubato 58). Officials at the White

House didn‟t learn the true nature of the incident until the next day, when the woman who owned

the property Cheney had been hunting on went to the local press. Media organizations across the

nation picked up the story, and Cheney‟s crisis began.

Officials tried to argue that Cheney had been on “a private hunting expedition,” and even

tried to blame the victim, claiming that “Harry Whittington may have actually contributed to the

accident by being in the wrong place as Cheney was shooting,” (Adubato 59). One New York

Times reporter represented the public‟s disappointment with Cheney‟s response when he wrote,

“the vice president appear[ed] to have behaved like a teenager who thinks that if he keeps quiet

about the wreck, no one will notice that the family car is missing its right door,” (59).

The crisis caused tension between the staffs of the president and vice president over how

the incident could have been avoided. The crisis “offers… insight into what can happen within

an organization when one of its members drops the ball in a crisis,” (Adubato 60). The delay in

communication caused the public to question what else Cheney was hiding, He continued to be

secretive, as if he believed that ignoring the crisis would cause it to go away, but doing so backed
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him into a defensive position (62). Four days after the incident, Cheney agreed to an in-depth

interview with FOX news channel, but the interview did little to assuage the public‟s fears.

Cheney had the sympathy factor on his side—had he explained that he was personally impacted

by the trauma of shooting his friend, the public would likely have understood (63). But while

Cheney acknowledged responsibility for the shooting, he refused to acknowledge that there were

mistakes in the way the information was disseminated to the public. In attempting “to defend the

indefensible,” Cheney‟s insistence that the incident was private strained his credibility.

Additionally, his interview source was questionable, as many believe FOX news to be friendly

toward Republicans (62).

Cheney‟s crisis was about communication and leadership skills rather than the actual

events. Larry Davis, who heads a Washington law practice that specializes in legal crisis

management, called the crisis “a self-created nightmare… Cheney took a non-story… and

created a huge negative story because of his stubbornness and arroagance” (Raum A1). Cheney‟s

disastrous response demonstrated the importance of immediate and full disclosure, and the need

for a communications leader to be able to accept responsibility and to acknowledge when

mistakes are made.

Johnson & Johnson, Exxon, Rudy Giuliani, and Dick Cheney were all confronted with

potentially devastating crises, and the manner in which they responded to the events had a direct

impact on the outcome. Giuliani and Johnson & Johnson officials were honest and truthful as

well as empathetic and compassionate. They acknowledged the devastating results of the crises

they faced and made a true effort to communicate with the public and meet the public‟s needs.

Exxon and Cheney mistakenly believed that ignoring a crisis would make it disappear, and made

disastrous decisions to blame others instead of acknowledging their role in the crises. It is clear
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that had Johnson & Johnson followed Exxon‟s model, it wouldn‟t have experienced such a swift

comeback from its crisis, while if Giuliani had followed Cheney‟s model for crisis

communication, he wouldn‟t have earned the title of America‟s Mayor. When an individual or

company is faced with a crisis, swift, honest, effective communication is the key to minimizing

damage and overcoming the crisis.

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Works Cited

Adubato, Steve. What Were They Thinking?: Crisis Communication: The Good, the Bad, and
the Totally Clueless. New Brunswick, NJ: Rutgers University Press, 2008. eBook.
<http://site.ebrary.com/lib/mcla/Doc?id=10251789&ppg=25>.

Kaplan, Tamara. "The Tylenol Crisis: How Effective Public Relations Saved Johnson &
Johnson." Aerobiological Engineering. Web. 4 Dec 2010.
<http://www.aerobiologicalengineering.com/wxk116/TylenolMurders/crisis.html>.

Raum, Tom. "Cheney's PR mishap is model miscue." Berkshire Eagle 17 Feb 2006: A1, A5.
Print.