CEO trip deepens crisis at Canadian bank

TORONTO: Canada's largest bank is still in damage-control mode after a massive computer glitch created an eight-day customer-relations nightmare.

TORONTO: Canada's largest bank is still in damage-control mode after a massive computer glitch created an eight-day customer-relations nightmare.

Though the problem now appears fixed, both Royal Bank of Canada customers and PR experts are debating the same question: Why did the CEO go on a business trip to London on the third day of the crisis?

It all started May 31 with a software upgrade gone wrong. Overnight, millions of customers couldn't access accounts. Bill payments did not register. Payroll deposits did not go through.

The bank went public with the glitch on June 1. Journalists gleefully pounced on the chaos.

Royal Bank's damage control included newspaper ads, radio spots, and interviews with Gay Mitchell, an EVP filling in for Gordon Nixon, the absent CEO who finally cut short his trip on June 5.

Nixon emerged, in full-page newspaper ads June 8 with a public apology.

He was finally quoted in the fourth press release on the issue, apologizing for "the inconvenience and hardship."

He also appeared on a national morning news program, Canada AM.

Judi Levita, manager of media relations at RBC Financial, said Nixon took the trip "because, at the time, the situation appeared to be under control."

Laurence Booth, finance professor at the Rotman School of Management in Toronto, called the efforts too little too late.

"It's the prime responsibility of a CEO to protect the brand, to appear at press conferences, and to field the media's questions," Booth said.

Others disagree. "When a company is in crisis, it needs to decide when to bring out the CEO," said Shelley Pringle, principal at Polaris Public Relations in Toronto. "But it's a juggling act. Play the card too early, and you've nowhere else to go."

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