Friday, February 24, 2012

Honda Announces Product Recall and See Positive Stock Price Move

As I have identified in my research on the impact of social media on crisis communications, being open and timely are 2 of 5 essential elements in an effective crisis communications plan.

Open.  Adopting an open reporting approach has two main advantages. Firstly, open reporting will establish the company's credibility with stakeholders with regards to their desire to resolve the crisis. This credibility will in turn position any subsequent actions taken positively. Secondly, being proactive in releasing information about the incident will prevent distortion of the facts.  This will allow the company to “frame” the incident in its favor as well as prevent the crisis from spiraling out of control.

Timely.  The timely acknowledgement of an incident, or potential crisis, will enable the company to gain the information initiative.  In addition, as there is usually conflicting information during the early stages of a crisis that causes confusion, the timely release of information will fill this vacuum and reduce distortion of facts.  Putting a “face” to the company also allows the company to establish itself as the primary source of credible information on the crisis.

This is perhaps one good example of how being timely and open not only helps avoid a potential crisis, but builds the brand's reputation.

For the full report click here.

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