Strategic CSR - Apologies

The articles in the two urls below both deal with the issue of apologies by firms for actions that have not met stakeholder expectations (Issues: Stakeholder Relations, p138). The first article emphasizes that the internet and related communication technologies are forcing greater transparency and accountability among firms (Figure 3.4: Free Flow of Information, p56):

“As if being a successful CEO wasn't tough enough, now you may have to learn a new skill: the art of apologizing. The number of public C-level apologies is growing daily as Mattel's Robert Eckert, Ameritrade's Joe Moglia, Apple's Steve Jobs and JetBlue's David Neeleman join a very long list. … What's happening? Have business leaders suddenly abdicated control? Are financial expectations overtaking common sense and good business judgment? Or have corporations lost touch with their customers? "All of the above" could be one answer. But a more accurate explanation is that our world of instantaneous and ubiquitous communication has given customers more power to hold CEOs and companies accountable than ever before.”

The second article contains a number of anecdotes of firms apologizing well and many more of them doing it badly. Both articles detail the potential consequences for firms that fail to apologize quickly and genuinely:

“Business leaders have not always found apologising so easy. Here, timing is every bit as important as in politics - it's just that the time horizons are so much shorter. In the summer of 1999 Doug Ivester, then chief executive of Coca-Cola, waited over a week before apologising to Belgian customers for the contamination of his product that appeared to cause widespread sickness. While the company hesitated, Coca-Cola was being taken off the shelves in France and the Netherlands as well. In 1989, Exxon's response to the Valdez oil spill off Alaska was even worse: silence, followed by grudging acceptance and a Dollars 4.5bn fine.”

The issue of apologies and the potential positive consequences for firms that do it well and genuinely is worth keeping in mind as the U.S. Supreme Court re-visits the Exxon Valdez case today—an error of judgment that continues to generate negative headlines for Exxon (Special Cases of CSR: ExxonMobil, p292), almost two decades after the event.

Take care
Dave

Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther

Nothing Is Insignificant When It Comes to Brand Fulfillment
Go Beyond: In Every Single Way, Marketers Must Do More to Lock in Customer Loyalty
By Don Frischmann
January 21, 2008
http://adage.com/cmostrategy/article?article_id=123169
The article is posted in full at:
http://yummythinking.com/tt/entry/Nothing-Is-Insignificant-When-It-Comes-to-Brand-Fulfillment

Say sorry and mean it - or don't say anything at all.
By STEFAN STERN
929 words
19 February 2008
Financial Times
USA Ed1
Page 13
http://www.ft.com/cms/s/0/7c87c596-de47-11dc-9de3-0000779fd2ac.html