Business Use of Media in Crisis Management

Business Use of Media in Crisis Management 1 – Introduction 2 – Why business should engage with media during crisis? 3 – What strategies are successful during crisis? 4 – Recent new stories 4.1 – Barilla Pasta 4.2 – Costa Concordia Cruise 5 – Conclusion REFERENCES: BIBLIOGRAPHY: 1 – Introduction Organizations have always lived crises, some economic, others policies, more common administrative and internal, although many of them without if it is aware. Currently, the speed with which information is sent and received and with the development of the media, much of the attention is focused on organizations and their actions because the population is perceived as an integral part of the social process that organizations develop. Crises are not merely problems or conflicts that happen daily in organizations. Crisis is an event that involves failure, which generates general distress and affects relationships. It is a fact that happens suddenly threatening the organizational image, business and may result in large financial losses. In this essay, it will be discussed why it is important for business to engage with the media during crisis. Next the strategies that are successful in public relations for businesses during such times will be explored. In the end, two recent news stories which centred on crisis for different business will be commented. 2 – Why business should engage with media during crisis A significant threat to the business that can impact negatively if not controlled is considered crisis. The threat can have negative consequences for the organization, for the industry and for the stakeholders in general. Three related threats are created by the crisis: the safety of the public, the financial loss, and reputation damage. For example, flight and industrial accidents can have serious injuries and deaths as well. Financial loss can be created due to the operations break causing a decrease in the market share or due to the decreased in purchase intention (Coombs, 2007). Dilenschneider (2000) stated that all crises will affect the company’s reputation to some extent. When a company faces a crisis, the management have to do and say something to the public. This is called crisis response. In this case the Public Relations (PR) has an important duty by helping the organization to reach the public with its message. The response needs to be very quick, accurate and consistent. According to Fearn-Banks (2011) an organization has to prove to its customer and to the general public as well that the negative image is not a fact. Therefore, it is really important that the business engage with the media during a crisis as soon as possible. The media is the best way to reach a wide variety of public and stakeholders very fast. The message spread out quickly and to a great amount of people. Probably some non-targets will receive the message; however, the most important is the speed and reach of the message. According to Dolphin (1998) a good message sent to the stakeholders can create an opportunity to make the organization’s image better. Even in a bad disaster a good message has a beneficial effect. It is also important for the business to engage with the media because when a company respond to the stakeholders about what happened it is a way of improve the corporate image and create a relationship with them. The best way to explain the crisis is using the media engagement (Barton, 2001). Besides, the engagement with the media can show that the organization is responsible and is trying to do the best for those who have been affected. The message has to be accurate and consistent in order to improve the corporate image. 3 – What strategies are successful during crisis? A great number of researchers have studied public relation strategies for business during crisis time in order to improve the organization’s image. As a result of this research it was developed a list of reputation repair strategies. The person who contribute more in order to determine the reputation strategies were Benoit (1997). From a great different number of researches which showed a matter for reputation strategies, Benoit evaluate and combine all of them (Combs 2007). With the work of Benoit and others, Coombs (2007) created a list of reputations repair strategies integrating all writings. Coombs stated that the reputation repair strategy can change in terms of how to help the victims and more than the organization interest. The list of reputation repair strategy is composed with ten strategies for crisis communication. Those strategies were divided in primary and secondary crisis response strategies. The primary has three main topics: Deny crisis response strategy, Diminish crisis response and Rebuild crisis response strategy. The secondary has one main topic: Bolstering crisis response strategies. The table 1 below show the strategies. Table 1: Crisis response strategies – Coombs (2007) In order to assess the reputational problem of a crisis, managers should follow a process based in two steps. The first one is to define the crisis type considering the way that the media and stakeholders are describing the crisis. Coombs and Holladay (2002) create a list of crises types according to the threat each one offer. See the table 2 below. Table 2: Crisis types by crisis clusters – Coombs and Holladay (2002) The second one is to inspect the previous reputation and important point of crisis history. In case of the organization had a negative reputation before, the threat can be enhanced. Reputation is considered an important asset for the company and it is very valuable and very important to protect. A crisis can probably affect the reputation with the negative word-of-mouth and it will decrease purchase intention. However, the reputation strategies will assist to reduce this probability (Coombs 2007). 4 – Recent new stories Several recent new stories which centred on a crisis for different businesses can be used as an example to highlight the communications strategy. Two recent new stories will be analysed. The first one is about the Barilla Pasta and its chairman, Guido Barilla, for his antigay comments. The second one is about the Costa Concordia Cruise and its captain, Schettino, for do not follow the navigation system causing a serious accident. 4.1 – Barilla Pasta The crisis started in September 2013. Having said that gay couples never will do advertising campaigns for Barilla, the president of the Italian pasta maker, Guido Barilla, apologized through media. The announcement was made after the statement had negative repercussions around the world and netizens started a campaign to boycott the products of the brand on social networks. The crisis type of the action taken by Guido Barilla can be classified as organizational misdeed management misconduct. According with the table 2 seen before, this crisis type is considered a preventable cluster because in that situation the organization knew that was taking an inappropriate action. Of course all the disorder could have been avoided if Barilla had not made the statement to the Italian radio La Zanzara. However, since a problem of this nature occurs, there are ways of minimizing the impact. The company took a primary crisis response strategy. The rebuild crisis response, apology, was used to indicate that the organization takes the full responsibility and ask stakeholders for forgiveness. Barilla was quick to respond to the crisis. The company post press releases on their official website and a video apology on company Facebook page. The retraction and apology from Barilla represent fundamental attitudes. It was necessary that he said he was not well understood and acknowledge the mistake. These cases it is important to accept the error and enhance the brand does not want to leave a bad image. The speed with which the message of the President of Barilla was posted on Twitter less than 24 hours after his interview with radio was another point where the company did the right thing. Have chosen Facebook and Twitter to rule was also a hit from the company. This is because the message first came to followers of the brand, which were probably inside the controversy. Knowing where relaying retraction is essential. It has to be directed to the right people, because they take it to those who still do not even know of the incident, will only arouse the curiosity of those people to the fact. The chairman also met some different LGBT organizations to apologize once again. In general, the crisis situation was well controlled by the organization. 4.2 – Costa Concordia Cruise In the year of 2012, on the night of January 13, a disaster occurred with one of the Costa Concordia cruise ship in Italy. It hit a rock and started to sink with 3,206 passengers and 1,023 crew on board. The commandant was Captain Schettino and the cruise was supposed to travel around the Mediterranean sea, including ports of Savona, Marseille, Barcelona, Palma, Cagliara, and Palermo. They are not absolutely sure that the Captain has not followed the navigation system. However, they assure that if this task was followed it would show clearly the dangerous that they were approaching. Schettino said â€Å"I have to take responsibility for the fact that I made a judgment error. This time I ordered the turn too late.† Then, at 22:54 on that night, the captain gave the order to the crew and passengers to abandon the ship. This tragedy was classified, by the Costa Concordia Full Investigation Report, as a very serious accident with dead or missing of 32 people. Also more 157 were injured, and from this number 20 were admitted to the hospital. In addition at the end they had total loss of the ship. With regard of the classification of the type of this crisis, it can be said that is a Human error accident (see table 2). This identification came, because as said before if the captain had followed the navigation system accordingly, this tragedy could be avoided. Also they said that the procedure to abandon the ship did not follow the Decision Support System and the â€Å"general emergency† alarm was given late. The company took a primary crisis response strategy. The rebuild crisis response, compensation, was used to offers money or other gifts to victims. Under these circumstances, after 5 days of the accident, the company’s CEO tweeted : I gave my personal assurance that we will take care of each every one of our guests, crew and their families. And some days after the CEO gave to the passengers that were on board, a 30% of discount on future trip cruises with the company. In addition, neither the CEO nor the Costa executives appeared in the pear of Giglio, the place where the ship sank, to speak with the survivors or to check the situation directly. In conclusion it can be said that the company Carnival did not know how to deal with the Concordia ship accident. As can be expected the physical appearance of corporate executives at the scene of the occurrence can be considerable significant. Also such attitude is crucial to prove the corporationsinvolvement and benevolence toward the victims. 5 – Conclusion To conclude, organizations have always faced a crisis. Sometimes economic, others policies or more common administrative and internal. Crisis is an event that disrupts the relationship and the normal business activities resulting in financial losses. Business has to engage with media very quickly because it is the best way to reach a wide variety of public and stakeholders very fast and it is the way of improve the corporate image and create a positive relationship with the stakeholders. Business has to identify the crisis type and after choose one of the several crisis response strategies that are successful in public relations to handle with the crisis. Two recent stories were presented. The first one, the Barilla Pasta, was an example of a well-managed crisis communication. The organization took some action very fast and before the first 24 hours. The organization apologized in different communication channels. The chairman made a video apologizing and also met some LGBT organizations to apologize once again. On the other hand, the second one, the Costa Concordia Cruise, was an example of not well managed crisis communication. The organization just took some action on tweeter 5 days after the accident. The CEO had the courage to offer 30% of discount for a future trip. Anyone from the organization, neither the CEO appeared in the place where the ship sank to check the situation directly. REFERENCES: Barton, L. (2001). Crisis in organizations ll. Cincinnati. 2th edition. Benoit, W. L. (1997). Image Repair Discourse and Crisis Communication. Public relations review. Coombs, W. T. (2007). Crisis Management and Communications: http://www.instituteforpr.org/topics/crisis-management-and-communications/ Coombs, W. T. (2007). Protecting Organization Reputation During a Crisis: The development and application of situational crisis communication theory. Corporate Reputation Review. http://www.palgrave-journals.com/crr/journal/v10/n3/full/1550049a.html Coombs, W. T. and Holladay, S.J. (2002). Helping Crisis Managers Protect Reputational Assets: Initial tests of the situational crisis communication theory. Management Communication Quarterly Dolphin, R. R. (1998). Fundamentals of Corporate Communications. Butterworth-Heinemann. Oxford. Dilenschneider, R. L. (2000). The Corporate Communication Bible: Everything you need to know to become a public relations expert. New Millennium. Fearn-Banks, K. (2011). Crisis Communication: A Casebook Approach. Routledge, New York, 4th edition. BIBLIOGRAPHY: For the recent new stories Barilla Pasta http://www.businessweek.com/articles/2013-10-07/barilla-in-hot-water-offers-a-lesson-in-reputation-management http://www.queerty.com/barilla-chairman-meets-with-lgbt-groups-in-an-attempt-to-reverse-global-boycott-20131008/ Costa Concordia Cruise http://www.cruiselawnews.com/2012/01/articles/social-media-1/cruise-crisis-management-fail-how-carnival-is-ruining-its-reputation-following-the-costa-concordia-disaster/ http://www.bbc.co.uk/news/world-europe-16563562

Financial Markets Assignment Essay

Explain how interest rates decline following major Fed purchases of mortgage-backed securities. The FED implements quantitative easing by buying financial assets of longer maturity, e. g. , mortgage-backed securities, from commercial banks and other private institutions in order to inject a pre-determined quantity of money into the economy. This is a means of stimulating the economy and lowering longer-term interest rates further out on the yield curve; quantitative easing increases the excess reserves of the banks, and raises the prices of the financial assets bought, which lowers their yield. Graphically, this can be explained with the aid of Figure below. The supply of money is shifted from point 1 to the right (MS1 to MS2) and, all else equal, the new equilibrium point (with aggregate money demand curve) is at point 2, where the interest rate is lower. i i1 i2 AD1 MS1 MS2 Quantity of Money 2. What could be the implications of lower interest rates for households and businesses? By implanting the policy of purchasing mortgage-backed securities, the FED has set its sight on increasing consumption and investment, which will ultimately increase employment. As described in question one Bernanke’s policy decreased interest rates to new record lows, encouraging borrowing for both businesses and households. The ability to borrow money at more attractive rates stimulates investment in durable consumer goods, such as automobiles, and in operational necessities such as buildings and capital equipment for businesses. Indeed, after the implementation of the policy mortgage applications increased significantly. Because of low interest rates households and businesses as investors could shift their preference away from bonds and into stocks. According to frbsf. org, the increase in stock trading volume has the effect of raising the value of existing stock portfolios, which in turn stimulates consumer and spending across the country due to the psychological effects of rapid capital appreciation. Lower interest rates can have negative effects on the value of the local currency compared to other currencies. As foreign investors dump their local-denominated investments in favor of more profitable currencies, exchange rates can shift to the detriment of the local currency. The weakening of the local currency serves to increase the attractiveness of local goods to foreign purchasers, which has the effect of boosting exports and international sales. All of the factors mentioned above have the combined effect of increasing productive output, or GDP, and increasing employment across a wide range of industries. As individuals, businesses and foreign investors are encouraged to spend more due to increased access to capital, higher portfolio valuations and weaker currency values, businesses in nearly every sector experience an increase in sales, often requiring them to grow their operations and employ additional labor. However, there are some negative implications from this policy. Without a strong commitment to control inflation over the long run, the risk of higher inflation is one potential implication of experiencing real interest rates below the economy’s natural interest rate. Low interest rates provide a powerful incentive to spend rather than save. In the short term, this may not matter much, but over a longer period, low interest rates penalize savers and those who rely heavily on interest income. If short-term interest rates are low relatively to long-term rates, households and firms may overinvest in long-term assets, such as Treasury securities. If interest rates rise unexpectedly, the value of those assets will fall (bond prices and yields move in opposite directions), exposing investors to substantial losses. Finally, low short-term interest rates reduce the profitability of money market funds, which are key providers of short-term credit for many (large) firms, e. g. the commercial paper market. 3. Explain the Fed’s policy dilemma and try to rationalize why unemployment in the US is stubbornly high while inflation is low. Based on the theory of the Philip’s curve diagram we notice that there is an inverse relationship between inflation and unemployment. Stated simply the lower the unemployment in an economy the higher the rate of inflation. Philip’s Curve Inflation Unemployment The explanation of the inverse relationship between inflation and unemployment is based on two assumptions. The first has to do with the fact that as unemployment rises there is no room for workers and labor unions to demand an increase so a wage inflation that would increase the prices of the final products cannot occur. Secondly high unemployment is a reflection of the decline in economic output and indicates an economy’s slowdown. Therefore competition among firms in recession will lead the prices at lower levels. But this is not the case currently in the US since we observe high unemployment and low inflation. The FED is concerned about the unemployment rate and in an effort to stimulate the economy and improve the labor market conditions it started implementing the quantitative easing policy. So the FED purchased MBS, helped banks to rebuilt their balance sheets, contributed into maintaining price stability, preserved interest rates near zero for more than three years, and prevented the economy from slipping into greater recession. Despite all these efforts the situation in the labor market did not improve. Apparently the fact that unemployment is still very high depicts the limitations of the monetary policy. The low business confidence, policy uncertainty, and the government’s reluctance to act are beyond the FED’s capacity. What is more the infinite use of the quantitative easing may produce undesirable effects in the long run such as stagflation. The only optimal solution under these circumstances is the co ordination of the FED’s monetary policy with the government’s fiscal policy plan that could boost the society’s confidence. . Do you think that another round of quantitative easing (QE) by the Fed would help stimulate the US economy? Please explain. The FED declared that the use of QE will be aggressively continued until the economy is improved. The cash injections into the economy helped interest rates to remain at low levels. Consequently everyone wins from this decision in the short run; homeowners can borrow at historical low levels of inter est rate, corporations can also take advantage of this act and invest, consumption increased and also the banks increased their profits and the stocks record a growth. So as long as the QE is active in the short run everyone is a winner. But in the long run things become vague. First of all historical evidence shows that despite the fact that interest rates may be at levels near zero it remains uncertain whether this will be the incentive to boost the actual economy. Secondly the fact that consumers will have more money to spend but fewer goods to buy might lead to a hyper inflation. Furthermore by repeating the use of QE is very possible to lead to a liquidity trap, unless the economy finds ways to stimulate production. Last but not least the FED’s decision to inject cash into the economy by purchasing MBS is questionable; Mortgage backed securities entail the risk of defaulting once again as they did in the real estate crisis and that would cost the Americans a lot more money repeating the history that started back in the September of 2001. To sum up the use of QE is indeed very effective but only in the short run. Short periods of economic recession can be avoided by stimulating the economy temporarily through cash injections but to maintain growth on the real economy we need to improve labor market conditions, productivity, innovation and bolster the economy’s confidence. So a combination of fiscal and monetary policy is the only way to prevent an economy from collapsing, and also is this is the only way to avoid a possible systemic risk that will negatively affect all the institutions and individuals. . How is a loose Fed monetary policy in the US affecting fundamentals (such as inflation, asset and commodity prices) in other countries? What does that imply about global monetary policy? Since the dollar is the vehicle currency in the global economy almost every country is tied to its value and everyone is affected by the monetary decisions of the FED. By the QE, the supply of dollars is increased and consequently the dollar depreciates against foreign currencies. This means that America’s exports will increase and on the contrary the imports will decrease. So countries trading with the US fear about the capital inflows and the possible inflation on commodities. On the other hand the FED support that there can be no further inflation since the global economy is in recession. Moreover countries experiencing huge capital inflows resulting in inflation can implement fiscal policy, such as imposing taxes, in order to contain the effects of foreign capital inflows which push up local stock prices and the currency itself. Every country should focus on its own monetary policy adjusting it to the problems that may experience. For example the US chose to inject more money in the economy. The results of such a decision are low interest rates, more exports but always with the risk of inflation. On the other hand a country experiencing high inflation might limit the money supply, increasing the interest rates with the risk of experiencing a decline in exports.

The Founding of Thebes

The founder of Thebes is known as Cadmus or Kadmos. He was a descendant of the union of Io and Zeus in bull shape. Cadmus father was a Phoenician king named Agenor and his mother was named Telephassa or Telephone. Cadmus had two brothers, one named Thasos, and the other Cilix, who became king of Cilicia. They had a sister named Europa, who was also carried off by a bull--Zeus, again. The Search for Europa Cadmus, Thasos, and their mother went to look for Europa and stopped in Thrace where Cadmus met his future bride Harmonia. Taking Harmonia with them, they then went to the oracle at Delphi for a consultation. The Delphic Oracle told Cadmus to look for a cow with a lunar sign on either side, to follow where the cow went, and to make sacrifices and establish a town where the bull lay down. Cadmus was also to destroy the guard of Ares. Boeotia and Ares' Dragon After finding the cow, Cadmus followed it to Boeotia, a name based on the Greek word for cow. Where it lay down, Cadmus made sacrifices and started to settle. His people needed water, so he sent out scouts, but they failed to return because they had been killed by Ares dragon who guarded the fountain. It was up to Cadmus to slay the dragon, so with divine assistance, Cadmus slew the dragon using a stone, or perhaps a hunting spear. Cadmus Founds Thebes Athena, who helped with the slaying, advised Cadmus that he should plant the teeth of the dragon. Cadmus, with or without Athenas help, sowed the teeth-seeds. From them emerged fully armed warriors of Ares who would have turned on Cadmus had Cadmus not thrown stones at them making it appear that they were attacking one another. Ares men then fought with each other until only 5 worn out warriors survived, who came to be known as Spartoi the sown men who then helped Cadmus found Thebes. Thebes was the name of the settlement. Harmonia was a daughter of Ares and Aphrodite. The conflict between Ares and Cadmus was resolved by the marriage of Cadmus and Ares daughter. The event was attended by all the gods. Offspring of Cadmus and Harmonia Among the children of Harmonia and Cadmus was Semele, who was the mother of Dionysus, and Agave, mother of Pentheus. When Zeus destroyed Semele and inserted the embryonic Dionysus in his thigh, the palace of Harmonia and Cadmus burned. So Cadmus and Harmonia left and traveled to Illyria (which they also founded) first handing over the kingship of Thebes to their son Polydorus, father of Labdacus, father of Laius, father of Oedipus. Founding Legends Athena reserved some of the dragons teeth to give to Jason.Thebes was an Egyptian city, too. One story of the founding of Thebes says that Cadmus gave the Greek city the same name his father had just given to the Egyptian city.Instead of Polydorus, Pentheus is sometimes named as the successor of Cadmus.Cadmus is credited with bringing the alphabet/writing to Greece.The continent of Europe was named for Europa, the sister of Cadmus. This is the background for the first of three sets of stories from Greek mythology about Thebes. The other two are the sets of stories surrounding the House of Laius, especially Oedipus and those around the conception of Dionysus. One of the more enduring figures in the Theban legends is the long-lived, transgendering Tiresias the seer. Source Ovids Narcissus (Met. 3.339-510): Echoes of Oedipus, by Ingo Gildenhard and Andrew Zissos; The American Journal of Philology, Vol. 121, No. 1 (Spring, 2000), pp. 129-147/

The Age of Reason and Revolution Essay - 810 Words

The Age of Reason and Revolution Many individuals that lived in the period of time known as the Age of Reason, discovered many new inventions and advancements to improve the quality of life. Some of these advantages brought fourth new ideas to extraordinary people who forever changed the way we look at life. Although many people found these discoveries to bring great revival to mankind, others rejected these new improvements and felt as if they were defying god. These years were full of discoveries, conflicts, and new visions of the world. The age of reason brought on many changes to religious, political, scientific, and literary aspects of the eighteenth century. The Age of Reason and†¦show more content†¦He wrote the influential pamphlet Common Sense, which was an assault on monarchial rule and the American colonies independence from Britain. â€Å"Society in every state is a blessing, but government, even in its best state, is but a necessary evil; in its worst state an intolerable one; for when we suffer, or are exposed to the same miseries by a government, our calamity is heightened by reflecting that we furnish the means by which we suffer.†(Paine) Paine also felt that society as a whole, was produced by our wants, and governed by our wickedness. Paine was once imprisoned in Britain for sedition. James Monroe, American ambassador to France, gained Paine’s release on the grounds that he was an American Citizen. Paine later went on to help boost moral and spirits when Washington was defeated. He wrote words of encouragement and inspiration. â€Å"Direct representative government, the distribution of power betwee n the respective levels of government, the significant role of local government and the evolution of a political structure that was eventually institutionalized are all the legacies of the formative years of the Colonial character of America.†(Brainard) During the seventeenth and eighteenth centuries, the Scientific Revolution, which was the development of new sciences and technology, and the Age of Enlightenment, which was the so called â€Å"age of reason†, had sparked women’sShow MoreRelatedAge Of Reason And The Scientific Revolution1089 Words   |  5 PagesHistory Honors 11 March 2015 Age of Reason The Age of Reason took place in Europe from the mid 1500s and ended in the late 1700s. This can be categorized into two different time periods. First, was the Scientific Revolution when many scholars created new ways of thinking about the natural world. 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