Blackwater incident sheds light on crises

Contractor's situation showcases that PR is no magic cure to difficulties of repairing reputation

Contractor's situation showcases that PR is no magic cure to difficulties of repairing reputation

On October 2, the House Committee on Oversight and Government Reform launched hearings into the role of private contractor Blackwater USA in the wake of a deadly incident in Iraq that claimed 11 lives. The Department of Justice is investigating a September 16 shootout in which Blackwater security personnel, while escorting a convoy to Baghdad, opened fire in a public square.

To help it prepare for its date before Congress, Blackwater hired BKSH & Associates, a subsidiary of Burson-Marsteller. According to a statement Burson issued, BKSH was tapped "through a personal relationship" with Blackwater, and "with the hearing over, BKSH's temporary engagement has ended." Blackwater did not return calls requesting comment, and it is unknown if it is currently working with any other firm.

At the hearing, Blackwater CEO Erik Prince defended his company's actions, claiming the security convoy was fired upon first. The hearing, combined with support from BKSH, perhaps marks the limited space where Blackwater can embark on an effort to fix its reputation. But even with a firm as reputable as Burson, clients may find limits to what an agency can realistically do.

"PR is not the panacea a client might think it is," says Nick Kalm, president of Reputation Partners. "Sometimes they think, 'OK, we've got this PR firm, now the articles [about us] will go from negative to positive.' Negative to balanced news coverage would be more the continuum."

"In the absence of good crisis planning... it inevitably [gets] very emotional, and [clients] want to say, 'This too shall pass, quickly,'" says Harlan Loeb, MD at FD. "It's a lot of hand-holding and telling them [that] the definitive statement on how they handled the crisis is not written the day the crisis breaks."

Blackwater's presence before Congress might help address the immediate crisis of accusations from Iraqi investigators, reporters, and even some members of the US military, not to mention a blogosphere full of voices, some of whom are activists with political or personal axes to grind. It remains to be seen, though, how Blackwater will handle the aftermath of the hearings, something experts say all companies should consider.

"While companies may do a good job working through the acute and chronic phases of a crisis, they sometimes neglect the reputation repair stage - turning the proverbial lemon into lemonade," says Chris Gidez, SVP of risk management and crisis communications at Hill & Knowlton.

While recognizing a difference between a financial crisis like bankruptcy and a company that's immediately involved in loss of life, such as Blackwater, crisis experts maintain that recovery is almost always possible.

"Absent very unusual circumstances, there is not a client whose reputation is beyond redemption," says Loeb. "It's a factor of time and commitment."

But a company like Blackwater could be in one of those "unusual circumstances." Because it's under contract with the State Department, its public statements are minimal, making it difficult for Blackwater to plead its case in the court of public opinion.

And another, modern suggestion from PR pros is likely out.

"The most effective strategy is for a company to share its point of view through its own blog, which can be viewed as the 'official' voice of the company," says Paul Walker, EVP of GCI Group's digital media practice, in a recent paper titled "Crisis Management and the Half-Second News Cycle."

It may just be that Blackwater's reputation overhaul will have to come in the form of more congressional hearings and reports, provided the company isn't permanently barred from operating in Iraq, as the Iraqi provisional government has recommended.

Blackwater's Prince has stated his support of government oversight, which could force the company to shift its practices, another key to reputation recovery, Kalm notes.

"Part of it is getting your message out, but the other is operational changes," he says.

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