Effective crisis leaders are problem solvers and they focus on the future. They also have lot in common with movie directors like Steven Spielberg. In Part 2 of this special series on successful crisis leadership, you will learn the crisis response strategies used by one leader as he fought off lawyers and battled daily to solve 5 major problems that erupted during a crisis that left more than 1500 homeless after a major pipeline explosion. You will also learn how corporate culture can save or sink an organization in crisis.
If you missed Part I, click here. Later, in Part 3, you will see the results this crisis leader’s motivation assessment test that reveals key leadership filters that greatly influenced his decision-making and crisis leadership strategies.
Crisis Leadership Part II Background
This special series focuses on Jim Hart, who was Vice President of Public Affairs for Texas Eastern Transmission Corporation (TETCO) when its huge natural gas pipeline exploded in a highly populated neighborhood of Edison, New Jersey. Jim’s team won many prestigious PR awards for their crisis leadership and crisis communication strategies in Edison. More importantly, TETCO earned the trust of the public and even the news media because of their approach to stakeholder engagement and crisis response. The goal of this special 3-part series is to help today’s crisis leaders gain deeper insights into effective crisis leadership and decision-making. For legal reasons, companies cannot always be frank about what they learn in the immediate wake of a crisis, but time has passed and we reached out to key leaders in the Edison crisis response. Jim has retired to his family farm in Florida, where he is active with charity groups and grows high-quality hay for area farmers. He also certifies aspiring pilots at a local airport and serves on the airport’s Board of Directors.
We also reached out to a couple of Jim’s key team members in Edison. Today, Jack Barnett is Chief Communications Officer for the Harris County Appraisal Office in Houston. Keith Schmidt is a PR and Crisis Consultant with Benchmark Communications, as well as a guest journalism instructor at The University of Texas. George Spadora, who was Edison’s newly elected mayor during this crisis, today practices law in New York.
Directing The Crisis Story
A crisis leader is like movie director Steven Spielberg. He makes decisions that direct the attention of the news media and stakeholders. Directors like Spielberg have one, main goal: create a successful, compelling storyline and manage issues that could impact that goal. In looking back on TETCO’s pipeline crisis response in Edison, Jim Hart and his team focused on one, main storyline. “Every one impacted by the incident needed help, and the company joined forces with multiple response groups like the Red Cross and United Way to provide the best help possible for about 1500 people left homeless by the incident,” says Hart. Behind the scenes, there was another important storyline playing out that was just as daunting and affected even more people. “The Northeast was facing frigid March temperatures, and it was critical that the pipeline be promptly repaired, so natural gas could begin flowing again to area homes and businesses,” says Hart. “But, before that could happen, we first had to address a series of problems – legal battles, as well as operational and stakeholder issues,” he adds.
Problem Solving 1: Empathy For Victims
Some of the best reputation management leaders know the importance of walking a mile in the shoes of victims – those most impacted by a crisis issue or event. “If you cannot quickly identify and satisfy this group’s needs, the media, politicians and other stakeholders will hammer you,” says Benchmark Communications’ Principal, Louie Modling. Modling is a lawyer and crisis management consultant. “There are short and long-term consequences if you get this wrong,” Modling adds. TETCO’s Hart knew that he had never experienced from a personal standpoint the trauma the nearby apartment residents faced. “They had just experienced the trauma of running for their lives and losing everything they possessed, so we immediately secured counseling services for them and set up a fund – cash that would not be considered as a claim,” says Hart. “They got $5000 with no strings attached. Then, we brought in risk management experts to help them get settled into new housing and vehicles,” Hart adds. Over the following weeks, TETCO’s spokespersons continually shared what was being done to help the crisis victims get back on their feet.
“Your corporate culture can make you or break you
during a crisis, because how you treat people daily
will only be magnified when bad things happen.”
Problem Solving 2: Culture Shock – or Rock?
Your corporate culture can make you or break you during a crisis, because how you treat people daily will only be magnified when bad things happen. Prior to a crisis, your culture has already influenced stakeholder and news media perceptions about your organization. What your employees, customers, vendors, media and others think about your company – are all a reflection of your corporate culture. “Your culture either weakens or strengthens your crisis endurance capabilities, and this is why stakeholder engagement is so crucial during good times,” says Modling. “Once a crisis occurs, you have a short window of time to confirm negative stakeholder impressions – or change those and create positive ones,” he adds. Years before the Edison explosion, TETCO had embraced a stakeholder-centric culture, and that resulted in the organization adding a “humanitarian aid” clause to its crisis response plan. Local managers knew they were empowered to immediately help those impacted by their operations. “That was simply part of our corporate culture,” says Hart. “Local managers cannot wait for higher approval when victims have immediate needs. This quick response immediately gave us credibility with the press and local elected officials. It helped build stakeholder trust and paved the way for improved communications between me as the company spokesperson and all our stakeholders,” Hart recalls. “Many members of the media were actually praising our efforts, which is rare in the midst of such chaos!” Hart adds.
Problem Solving 3: Colliding Perspectives
It is a given that politicians, regulators, residents and the news media will have very different perspectives during crises. This is where many organizations flounder with their crisis response. They often lack effective reputation management and stakeholder strategies to truly understand “other” perspectives. Naturally, in Edison, the media primarily turned to Mayor George Spadora for the community’s perspective. Spadora’s job was to look out for the best interests of the residents and emergency responders. “Our first focus was on taking care of those left homeless and we were satisfied with how TETCO stepped up and acted responsibly toward people, Spadora recalls. “Also, I cannot remember any specific request we made where the company was not responsive,” he adds.
Problem Solving 4: Reality Wars
But, Spadora admits there was one big area of dispute. “Our biggest dispute was around the timing and psychology of putting that line back into operation. Looking back now, it makes sense that a utility thought in terms of repairing the line and getting it back into operation,” says Spadora. “But, the community was still in deep shock and dealing with the catastrophe. We initially thought that hundreds had died in the explosion and we brought in cadaver dogs to find bodies,” the former Mayor recalls. “Nearby residents and people were constantly calling our office that first week, especially with concerns about the pipeline starting up again. So, when the company started talking about getting the line back into service, we thought they had to be kidding – we were just not ready to go there psychologically,” says Spadora. “Colliding perspectives attract media attention during a crisis,” says Benchmark’s Modling. “You have to truly understand human behavior patterns and emotions to effectively assess and manage the emotions that come with those different perspectives.” Modling adds.
“When the company started talking about getting the line
back into service, we thought they had to be kidding!”
– Former Edison Mayor, George Spadora.
Problem Solving 5: The Moose Mentality
If you have ever watched National Geographic, you may have seen a pair of moose locking antlers in a fight over territory. During a crisis, there are often temptations by impacted parties to adopt the moose mentality and defend their position. Like Hart, Spadora also had a law degree, and at first he attempted legal maneuvers to keep TETCO from moving too quickly on getting the line back into operation. At the same time, TETCO’s lawyers were digging in and ready to take legal action to address the mayor’s concerns. But, Hart knew better. He knew that a “win / win” solution was essential, or things could quickly fall apart and harm long term relationships and goals. “I had a career background that allowed me to understand the mayor’s point of view. I had been in government relations, worked on political campaigns and had also been a lobbyist at one time, so I fully understood politics. I knew Mayor Spadora needed to win with his constituents; he needed to walk away from this crisis with community support and his political career intact. Our lawyers were trying to convince management to let them deal with the dispute using legal tactics. But, I was able to work closely with Mayor Spadora’s staff and we hammered out an agreement that was a win / win for both sides. In the end, our leadership team agreed and this allowed us to present a united face to the media and public,” says Hart.
Coming Up… Part III Effective Crisis Leadership
In Part 3, you will see the results of Jim Hart’s motivation assessment test that reveals key leadership filters that greatly influenced his decision-making and crisis leadership strategies in the Edison crisis.
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* Benchmark Communications was honored to work with TETCO before, during and after the Edison crisis. TETCO’s PR leaders and crisis communications team were instrumental in creating a stakeholder-centric culture that was key to the company’s success in Edison. Their leaders also credited Benchmark’s crisis management strategies, executive media training, media crisis training and stakeholder engagement programs for contributing to their stakeholder and crisis response approach in Edison.