How do you respond?
Controversy and scandal can put a media bull's-eye on government contractors. If your company should face a public relations crisis,are you ready?
- By Roseanne Gerin
- Feb 18, 2005
Jack London, CACI's chief executive, said he tried to be "out front and on top in providing information, cooperating with the media and cooperating with the authorities" during the Abu Ghraib crisis.
Crisis management "is a function of doing business every bit as much as winning contracts is a part of doing business." ? Steve O'Keeffe, O'Keeffe & Company
Government contractors "have naturally skittish customers who can be scared off at a drop of a hat" by a Government Accountability Office report or federal investigation. ? Don Goldberg, Qorvis Communications
Duane Andrews, chief operating officer of SAIC, said his company and the FBI shared blame for a troubled IT project.
Henrik G. de Gyor
Jody Brown, chief spokeswoman for CACI International Inc., vividly recalls the phone call she received on the afternoon of April 26, 2004:
"This is Seymour Hersh. I have a classified government document that implicates your employees in the torture of detainees at Abu Ghraib. What do you have to say about that?"
Brown knew immediately that a crisis was brewing.
Hersh, a renowned investigative reporter with The New Yorker, had an Army report alleging that two CACI employees were involved in the abuse of Iraqi prisoners at the Abu Ghraib prison outside Baghdad. Hersh's article detailing the abuse, and a report by CBS' "60 Minutes II" ignited an international firestorm that quickly enveloped the Arlington, Va., contractor.
CACI received hundreds of phone calls, e-mails and inquires about the alleged involvement of the company's employees in the abuse scandal, with reporters and camera crews even staking out the lobby of its headquarters.
CACI officials initially had little information of their own; for example, they didn't have a copy of the classified Army report or any access to military investigations into the matter. Yet reporters demanded details about their activities.
War critics roundly condemned the contractor and its work for the military, even though CACI officials could find no evidence that any CACI employees actually participated in the abuse.
"From then on, we were just swirled up in this typhoon, sort of like a little leaf or something bubbling around out here with all these different currents of opinion, and viewpoint, and media, and coverage, and TV, and international issues and Congress," said J.P. "Jack" London, CACI chairman, president and chief executive.
"It was a huge swirl of things ? enormous," he said. "I would say it was not only a crisis, it was an enormous crisis with international proportions."
A HUMBLE CLUB
CACI is just one of many government contractors that have come under fire for allegations and complaints about corporate misconduct during the past year.
Titan Corp. of San Diego also had one of its employees named in the Army report on Iraqi prisoner abuse. At the same time, Titan was under investigation by the Justice Department and Securities and Exchange Commission for allegations that its employees bribed foreign officials to win contracts.
Computer Sciences Corp. came under scrutiny after the IRS accused the company of missed deadlines and cost overruns with its IT modernization project.
Likewise, last month the FBI publicly pounded Science Applications International Corp. about the company's work on the Virtual Case File system.
And Boeing Co. has had to contend with the conviction of a former procurement official and her boss at Boeing for improper dealings with the Air Force.
When such catastrophes hit, companies must quickly assemble a crisis management team to gather information and plan a response, public relations experts said.
Team members should include upper management, communications personnel, the company's general counsel and perhaps an outside law firm or public relations company.
[IMGCAP(2)]With its communications team, a company must get ahead of the publicity juggernaut and shape the company's message before rumor and innuendo take over.
"Organizations should move rapidly to acknowledge and quarantine the issue, to position the issue as an anomaly rather than as a systemic problem," said Steve O'Keeffe, president of high-tech public relations firm O'Keeffe & Company of Alexandria, Va.
They also must set the proper tone by first acknowledging any wrongdoing and sympathizing with the injured party, O'Keeffe said.
"Acrimony and arrogance are never appropriate," he said.
Government contractors have an additional concern, because their performance is watched by the general public, the media, federal lawmakers and their agency customers.
Government contractors "have naturally skittish customers who can be scared off at the drop of a hat" by a Government Accountability Office report or federal investigation, said Don Goldberg, managing director for crisis communications at public relations firm Qorvis Communications of McLean, Va.
They also have a "900-pound gorilla in that they can be debarred if found guilty," he said.
Crisis management "is a function of doing business every bit as much as winning contracts is a part of doing business," O'Keeffe said.
OPEN UP OR HUNKER DOWN?
When the crisis management team is in place, those responsible for media relations should get out in front to prevent the crisis from snowballing and give honest and correct information promptly, experts said.
Under the terms of some government contracts, companies cannot give any information without approval from their federal customers. They may not be able to issue a statement if security matters are involved. If you can't say anything or have no new information, then say so, experts said. Likewise, never resort to "no comment," because it looks as if you have something to hide, they advised.
"In a crisis, there is no substitute for being available, being accessible and providing as much information as you can," said Jeff Eller, managing director of Public Strategies Inc., a business advisory firm in Austin, Texas. "You will get a tremendous amount of benefit of the doubt and goodwill if you go out there and address" the situation.
CACI's London said that early on, he decided to use as his model Johnson & Johnson's widely praised public response to the Tylenol crisis in 1982. In that case, seven people died after ingesting Extra-Strength Tylenol capsules that had been laced with cyanide. Rather than go into a defensive crouch, Johnson & Johnson immediately pulled Tylenol from the shelves and kept the public informed about what it knew and its planned actions.
"The approach that Johnson & Johnson used was to be absolutely out front and on top in providing information, cooperating with the media, cooperating with the authorities and so on ... and that's what we did," London said.
CACI initially turned to its external public relations firm for help, but realized it needed crisis management specialists to advise the company and build a custom-tailored response, London said. The media team reviewed all news reports on the company as they related to the Abu Ghraib prison scandal, and sent letters to publications that it believed had incomplete or erroneous information.
London also hired Washington consulting firm Clark & Weinstock to set up meetings with lawmakers and their staffs on Capitol Hill "because we were not a household name."
Titan, the other company caught up in the Abu Ghraib prison scandal, made few public statements about its alleged role. Complicating Titan's decision whether to respond was the fact that Lockheed Martin Corp. had proposed in September 2003 purchasing the company for $2.2 billion.
In one of Titan's statements, a brief May 7 press release, Chairman Gene Ray said the company employed translators and interpreters for the Army in Iraq. The statement added: "Titan is committed to full cooperation with government investigations into these matters. Should evidence arise of unethical or illegal behavior, we will take appropriate action."
By contrast, CACI issued 20 press releases from May through October. The company also set up a link on its Web site answering questions about the company and its business in Iraq.
Given the gravity of the crisis, some public relations experts said Titan should have been more vocal.
[IMGCAP(3)]"Titan's silence was a mistake," said Jonathan Bernstein, founder and president of Bernstein Crisis Management LLC of Monrovia, Calif. "Silence sends a message, one subject to interpretation by the listener but most typically interpreted as, 'We're afraid to talk,' or 'We're guilty,' or 'We're covering something up.' "
Goldberg disagreed, saying Titan "decided not to play the game, and it worked OK for them" because the national media that often drives these stories didn't pay too much attention to the company.
Titan declined to comment for this article. "I am sure the lawyers will not allow this," company spokesman Wil Williams wrote in an e-mail. "If I make a comment one way or another, it could carry an implication or consequence" for pending investigations.
Titan is still awaiting the outcome of SEC and Justice Department investigations into allegations that workers at overseas subsidiaries bribed foreign officials for business. Lockheed Martin withdrew its acquisition offer in June 2004.
DEFENDING A REPUTATION
When responding publicly to a crisis, don't make the client or the media your adversaries, but stand up and shield yourself when you must, public relations experts said.
"You walk a tightrope and must defend yourself without antagonizing the customer," Goldberg said about government contractors, adding they "must be cautious of defending" their capabilities while not appearing antagonistic to their clients.
SAIC in January was criticized by the FBI, which at a press conference said the San Diego company had botched its Virtual Case File system work for the agency's $170 million IT upgrade project, known as Trilogy.
Following the press conference and subsequent media reports, SAIC issued a press release, saying the company had performed well and that the FBI was partly to blame for problems.
In a published statement, Duane Andrews, SAIC's chief operating officer, said the FBI switched the project's focus and changed the system's requirements, causing delays and cost increases.
"In the time that SAIC has been working on the Trilogy project, the FBI has had four different CIOs and 14 different managers. Establishing and setting system requirements in this environment has been incredibly challenging," Andrews said.
But Andrews also sounded a conciliatory tone. "All parties involved have made mistakes in the way the Trilogy program was handled in the past. SAIC hopes to move beyond this and continue a mutually beneficial relationship with the FBI," he said.
Although SAIC declined to comment for this article, public relations experts said SAIC correctly handled the situation.
"You can't just let yourself be attacked," Bernstein said. "If the company doesn't say something, then the FBI's stand is the truth. But it must be accurate and demonstrable."
Eller of Public Strategies said: "Theoretically, if you get hit, and the facts are on your side, you've got to hit back. Maybe [SAIC] felt they did a good job and had to defend their employees, so management stood behind them, and it was good enough to take a public decision."
The importance of defending employees also was uppermost in the mind of CACI's London. He recoiled at the prison abuses, but said he did not want to simply assume that the CACI employee named in the report was guilty.
"We're a services company. All we have is people," London said. "Our relationship with employees and our behavior toward employees from a company standpoint is really important for our image and reputation" and ability to attract workers.
Many industry people were impressed with how CACI fought back and defended its employees, Goldberg said.
"CACI made it clear it was going to correct the facts, and its aggressive strategy was pretty effective," he said.
INNOCENT OR GUILTY: DOES IT MATTER?
In many public relations crises, it takes some time to determine whether the company is guilty of any alleged misdeeds that prompted the unwanted publicity. In the case of CACI, only one of its employees ? not two, as initially reported -- was named in the first classified Army report. More importantly, subsequent investigations by CACI and the military, including recent trials of the perpetrators, have not turned up any evidence that CACI's employee was involved in the prison abuse, company officials said.
[IMGCAP(4)]In SAIC's case, the company did not claim to be blameless but also pointed to FBI actions that had contributed to problems with the Virtual Case File system.
Companies are entirely justified in defending their employees and reputations in such instances, public relations experts said. All agreed that companies should be open and forthcoming with information, because that will help them make their cases with the public and their customers.
But what if a company actually is guilty of wrongdoing? Should a company adopt the same approach to crisis management?
Boeing last year faced a major public relations crisis when it was accused of ethics violations in recruiting senior Air Force official Darleen Druyun to the company. Druyun was fired from Boeing and later sentenced to prison after it was discovered that she had negotiated a job with Boeing while she exercised authority over the company's contract activities. Druyun's boss at Boeing, Michael Sears, also was fired and pleaded guilty to illegally negotiating Druyun's job.
In such situations, the company must balance the rights of its accused employees with the need to resolve the crisis, public relations experts said.
"From an employee relations and morale perspective, the company can't be viewed as internally hanging the employees out to dry, as tempting as that may be," Goldberg said. "The only way to handle this from the public relations standpoint is to demonstrate respect for the process while demonstrating that you are taking all appropriate steps to get to the bottom of the issue."
Boeing declined to comment for this article, but the Chicago aerospace and defense company is clearly concerned about polishing its image.
During a company financial conference call earlier this month, Boeing Chief Executive Harry Stonecipher said: "We're committed to restoring our reputation for excellence and integrity with all our stakeholders. And as we continue to work through some challenging issues, I'm very proud of the focus that the Boeing team has in bringing and creating value for our customers and our shareholders."
WATCH HOW YOU SAY IT
Companies need to deliver messages that are not emotionally charged or tinged with animosity, public relations experts said. They should express empathy or compassion for the problem at hand, but not take pot shots at the media or use them as a soapbox.
"The tone that a company takes has a bearing on the way that you view them," O'Keeffe said.
O'Keeffe noted a particularly acrimonious exchange between CACI and California State Treasurer Philip Angelides. After the prison scandal broke, Angelides called for the state's two largest pension funds that held stakes in the company to question CACI about the training and supervision of its interrogators in Iraq. In an Oct. 18 statement, Angelides said CACI interrogators "were deeply involved in the abuses," a charge CACI officials vehemently denied.
Angelides "continues to display an appalling ability to distort the truth, disregard the facts and spread vile lies to the public to promote his political ambitions," CACI said in statement released the next day.
O'Keeffe said that in this instance, CACI's response came across as "self-righteous" and even "vicious," making the company appear defensive and thus weakening its case.
London isn't apologetic. CACI's top executive said he felt a duty to defend his employees and the reputation of a company that has served the federal government for 40 years.
"We're certainly not going to swallow a bunch of vicious, malicious accusations and lie down and pretend like mea culpa, we've done all this sinful stuff, because we hadn't," London said. "I want us to be known as somebody who will answer those types of accusations."
Staff Writer Roseanne Gerin can be reached at email@example.com.