James Grunig, Professor Emeritus of University of Maryland is a noted public relations theorist and author of many textbooks in communication faculties in the world. Professor Grunig who attended this year’s edition of PR Award, said the big collapses in United States could have been prevented by specialists in public relations and gave advices for a better management of one of the biggest crisis in history.
The professor notes a special case: head of PR department of Merril Lynch attended an international public relations conference a week ago. Being asked if the investment bank’s collapse could had been avoided, Merrill Lynch representative recognized that few weeks ago he heard rumors among employees of how dangerous some products and decisions of the banks may be. He refused to communicate to CEO O’Neal the rumors.
“Then the whole crisis occurred. He mentioned that the CEO was fired. The PR person said to the CEO “Here’s what I’ve heard earlier”. And he said “I wish you would have told me that. Because it would have been very helpful”. I’m not sure that in something so complicated – finance is one of the most difficult areas of the corporation to really understand by public relations people, especially if they are not so well trained. Which is why it can be dangerous to keep information from the CEO,” Grunig said
At this point, nothing can be prevented anymore, and PR persons cannot act to manage the crisis. Professor Grunig is the author of a crisis management theory that consists of four principles.
The first and most important is Accountability Principle. The organization must assume the full responsibility for break-out of a crisis, even if not all of the factors that were under its control. Grunig reminds of two classic examples – the sinking of Exxon oil tank, when the company blamed the captain of the ship, and Tylenol crisis when Johnson&Johnson assumed responsibility even though it wasn’t its fault.
In case of the financial crisis in United States, banks, government and Treasury should have all assume responsibility, Grunig believes. “A big share of the population believes that the banks aren’t being accountable. They made bad decisions, they lost a lot of money and now they want the government to bail them out. Therefore the public is not willing to support the bail out because they think banks ought to be accountable for their decisions. I think that’s true. I’ve heard very little from most of the financial institutions that are involved in the crisis in saying what they presume had happened, what are they to do”.
The second principle of crisis management is Disclosure Principle – you must communicate exactly what happened, what were the causes and what measures you will take, even if law advisors will tell you to remain silent. It is a principle that has not been respected by American financial institutions. “A part of the problem, when I think about it I can’t see that the government and the secretary of the Treasury are fully disclosing everything that’s happening and what they’re going to do. I would interpret it as a lack of support. People are frustrated, so it has to be that all of the details they don’t fully understand, that haven’t been disclosed”.
The third principle set forth by Grunig is the Symmetrical Communication Principle. In an organization,it must be a two-side communication, both from management to employees and public, and reversed. According to Grunig, government and financial giants affected by the crisis must know the feedback of specialists in finances but of common people as well.
“When the crisis gets so complicated you have to listen to them. If I were to do research I would probably interview and focus groups and ask what you need to know to understand this. Talking not just to financial people, but ordinary people in small towns to at least understand how they understand,” Grunig pointed out.
The fourth principle is The Relationship Principle: An organization can withstand both issues and crises better if they have established good, long-term relationships with publics. There are strong relations that evolve in time. The problem of the actual crisis, Grunig said, is that investment banks were not used to communicate with the public, focusing on relations with big companies.
Even if until now the four principles were rather ignore, American financial institutions will be forced to take them into account. “It’s one of the biggest crisis ever. In the time of the crisis it’s pretty difficult not to follow these principles because the media are so on top of the organizations that it’s very difficult not to disclose because the media is going to take the information from some place. And it may not be as accurate, as far as the organization is concerned”
The long-term experience of Grunig makes him believe that PR will loose its attribute of information spreader and will focus on strategic advisory. And the financial crisis that the world is experiencing at the moment will surely fasten this passing.
Translated and adapted by Camelia Oancea.
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