Crisis management procedure: Coping with a crisis

01 February 2007
Crisis management procedure: Coping with a crisis

You can make contingency plans to protect the image of your business, but how do you deal with a crisis over which you have no control? Three months on, Nic Paton looks at the fallout from the polonium-210 poisoning

In years to come it could win you the jackpot in your local pub quiz: name the seven hotels or restaurants caught up in the Alexander Litvinenko/polonium-210 poisoning affair of 2006. Some are well enough known by now: the Pine Bar of the Millennium hotel, Mayfair, where seven workers tested positive after the former Russian spy ingested the radio-active poison. Pescatori on Dover Street, the last establishment to be named, checked out and cleared by the Health Protection Agency. Itsu, the Piccadilly sushi bar shut in a blaze of publicity, with all 137 staff tested and then given the all clear.

But a number of other hospitality establishments were also touched by the affair. One worker tested positive at the Sheraton hotel on Park Lane, as did one at the Best Western Premier Shaftesbury Avenue. At Parkes hotel in Beaufort Gardens traces of localised contamination were found in two rooms, but at such low levels as to be of no concern, and the Ashdown Park hotel in Sussex was checked and cleared.

"The worst moment," says Dave Walsh, head of sales and marketing at the Parkes hotel, "was when right at the start we were told by police that it was possible the contamination could have moved from room to room and that if that was the case they could be shutting us down. But they were very professional and quickly established that it was localised to those two rooms. The Health Protection Agency's advice was that there was nothing special either we or they needed to do."

Having a police presence in your hotel does mean that you are unable to operate as usual and what's all too clear by now is that all these establishments, and all the workers affected - thankfully none seriously - were innocent parties caught up in tragic events that had their roots thousands of miles away. Nevertheless, no restaurateur or hotelier wants their name splashed across the papers in this way. The worry, particularly in an age of 24-hour and online news, is what sort of damage will it do to you financially and in terms of your organisation's brand, and how can you manage events to minimise damage?

In the case of Itsu, the financial damage is almost inevitably still being felt. A brave face is being put on the company's website, but the Piccadilly site remains closed. Its latest statement simply says that "we have finally secured access to our shop in Piccadilly and have started the clean-up process. It is being closely monitored by various government agencies and we expect to reopen in mid-March 2007".

It goes on to explain that staff are working at the chain's new Paternoster Square outlet and most of them will return to Piccadilly when it reopens, adding, with a nice touch, "as they are missing their shop".

At the Millennium hotel, where the Pine Bar, a room on the third floor and the downstairs gents are likely to be closed for further investigations for the next six months, general manager Stefan Buchs has come up with a temporary solution to ensure staff are kept on board. He has converted the former Brian Turner private dining into what is now called the Mayfair Lounge as a temporary replacement for the bar. "It's been a 24/7 thing," Buchs says. "I've been working right through since 24 November, when Scotland Yard first entered the hotel. There has had to be a lot of communication with the staff and a lot of counselling, and we've been working very closely with the Health Protection Agency."

But surely this is precisely the sort of unforeseen event for which we pay our through-the-nose insurance premiums? Not necessarily, cautions Malcolm Tarling of the Association of British Insurers. "It's obvious to say it, but it will very much depend on the terms of your policy. Most will not normally cover radioactive attack or contamination, so you need to check the wording, as it may well be that you're not covered for the cost of the clean-up and things like that," he says.

Others in the industry suggest that even if you are unable to claim for the direct contamination, there may be scope to claim over business disruption elsewhere. Again, it's worth speaking to your insurance people early.

The potential long-term damage to your brand and custom is a much harder thing to gauge. Itsu owner Julian Metcalfe declined to speak to Caterer for this feature, but in one of the few interviews he has given since the affair blew up - to the Times newspaper in December - it's clear just how difficult the whole period has been.

"I thought it was the end of Itsu. Something covered in that much publicity? Instructing customers to call the NHS? Forget it. I was convinced, convinced, that it was the end of the company," he said.

His staff suffered a "terrifying" week waiting for the results of their urine tests, he said, but the main thing was they got the all clear and no customers were harmed either.

"Do I really think this has been good for the brand? I suppose in some sick way it has. Does it make us more famous? Yes. Do I wish it had never happened? Yes," he added.

In this type of crisis your hands will partly be tied by what the police or health protection authorities tell you you must do. After all, Itsu was, for a time, a crime scene.

Yet whether by luck or design, Metcalfe and his team appear, thus far at least, to have managed the crisis and ridden the resulting media storm extremely well, says Stephen Minall, managing director of the supply chain consultancy Moving Food. "He was able to say to investors and the public very early on that it was low-risk. Whether or not it was something he was advised to do by his PR people, you have to take your hat off to him in terms of protecting the brand," he says.

Sense of humour

What's more, even in adversity, the chain has not lost its sense of humour, a crucial part of its youthful brand. Take the hoardings around the Piccadilly site, for instance. At first, with time of the essence, they were a funereal black, but when it was pointed out this made it look as though something dreadful was going on inside, the chain moved quickly to add its own designs.

As operations manager Glenn Edwards explained to trade magazine Design Week, once it was clear none of the staff was contaminated or in any danger, it was felt it was safe to start to look forward. First the hoardings were changed to pink - "the policemen stationed outside the building looked pretty uncomfortable with that" - and then, cheekily, to a James Bond-inspired theme, complete with iconic gun-barrel motif. "What has happened is very sad, but we want to let people know we'll be open for business," Edwards said, adding: "It's been a crazy few weeks."

"You really have to feel for them because if you'd sat down with your PR company to plan how to respond to a crisis and suggested this you'd have dismissed it as being way too far-fetched," agrees Elisabeth Lewis-Jones, vice-president of the Chartered Institute of Public Relations. In this type of event you have to work on two fronts, internal and external, she argues. "Your main concern has to be internally with your staff, and you have to make sure they are communicated with and well looked after," she advises. "Then you have to stand back and see who your other stakeholders are - your customers, suppliers and so on."

Perhaps Itsu's luckiest break - if you can call what happened to it lucky in any sense - is that it has other branches. This meant that even though the Piccadilly site was cordoned off, it was relatively straightforward to transfer staff and customers temporarily to other sites.

If your only option is to send workers home or even worse, lay them off, it's much harder to maintain communication, loyalty and goodwill, all of which minimise the chance of negative information leaking out.

In fact, one of the few interviews to have emerged with an Itsu worker has been in, of all places, the Sun. In November, at the height of the affair, the newspaper revealed, in its inimitable style, the fears of "stunning sushi bar girl" Ela Malek and her co-workers.

"I feel like I'm caught in the middle of some mad spy movie. Friends who know I worked at this restaurant are too scared to touch me in case I contaminate them. It's horrible," she told a reporter. "I came into direct contact with him [Litvinenko] that day, which I've been told has put me at higher risk of being contaminated. I have been absolutely terrified since it came out about him," she added.

In PR terms it's all too easy to see how much more damaging an interview with a more disgruntled worker might have been in similar circumstances. What's more, as Metcalfe himself touched on in the Times, there may perversely be a silver lining for Itsu and other outlets affected by this affair. Certainly, Itsu's name recognition has never been higher.

"Talking about its positives is a bit insensitive when you think about what's happened to some of the people. But before this all happened I wasn't really aware of Itsu as a brand. Now I seem to see it everywhere I go," points out one industry consultant.

Adverse publicity

No one has been crass enough yet to offer "polonium tours" of the various bars and restaurants affected, but who's to say, once Itsu reopens, that it or the Pine Bar won't become in some way part of the London "tourist experience"? "If people become nosy and want to go there, then they will probably get more business out of it," concedes Minall.

The adverse publicity has already had a positive knock-on effect in other areas, too. When in December Itsu opened its first outlet in New York, it garnered much more publicity than it could ever have hoped for pre-Litvinenko.

Longer term, though, because it has ultimately been a negative and tragic event and has those fearful associations with radiation and radioactivity, it may not be something the chain wants to become permanently linked to its brand, cautions Lewis-Jones. "They will probably need to manage that," she points out. So probably no polonium-branded aqua zingers or "Litvinenko sat here" plaques, then.

"Half the battle in maintaining a good reputation is having had a good reputation to maintain in the first place. It's a good idea to start managing your reputation early on, so that if something happens you have something to fall back on," Lewis-Jones recommends. "You need to react really quickly," she stresses. "And never, never say ‘no comment'."

How to respond in a crisis

  • If you have operational or customer duties, delegate so that you can dedicate yourself solely to managing the crisis.
  • Seek the facts and quickly assimilate the evidence to inform the right decision, for example full or partial closure, "business as usual", apology, etc.
  • Reassure customers and provide clear information about reopening dates, adjusted operating hours, reduced levels of service, etc.
  • Open up communications channels with staff, agencies, authorities and media, and ensure communications are regular, consistent, unambiguous and originate from a single nominated source.
  • Place a "hush" order on all other employees and hold daily planning meetings.
  • If it's clear the restaurant is to blame, say sorry in a meaningful way, identify what remedial steps are being taken, and provide reassurance that tangible changes will be made.

Peter Antenen, principal, Antenen Consulting

Spining around

Spin may be considered a "black art". Yet even when it feels events are spiralling out of control, it's sometimes possible to steer things back your way.

In 2001, the GMB union branded roadside chain Little Chef "Scrooge Boss of the Year" after a manager failed to pay an employee £248.90 for four days she had worked the previous December. As the chain's PR consultancy Mason Williams later explained, a story that was rapidly gathering negative momentum was nipped in the bud by a decisive media response.

"A short statement apologising to the employee for the error and promising immediate payment was drafted, approved and issued," it said. "As media interest in the story intensifiedall Little Chef restaurants in the region were alerted to the situation and advised to refer any media enquiries to the consultancy. Meanwhile, the ex-employee's outstanding wages - and an additional sum by way of apology - were delivered by hand.

"The prompt action defused the GMB the story received no national exposure and coverage only appeared in the Whitstable Gazette, and on Invicta FM and Meridian TV. In each case the tone was: ‘Little Chef has apologised.'"

Time line and radiation trail

16 October

Two former KGB agents, Andrei Lugovoi and Dmitry Kovtun, stay at Parkes hotel, Knightsbridge. (Two rooms found to be contaminated are later closed - primarily because they are a potential crime scene rather than dangerous - and reopen at the end of November). The former agents later meet Litvinenko at Itsu in Piccadilly. (Restaurant seats are later found to be contaminated, but these are not the same seats used by Litvinenko and Italian parliamentary investigator Mario Scaramella on 1 November).

25 October

Lugovoi and Kovtun meet Litvinenko at the Sheraton Park Lane hotel. Traces of radioactive material are later detected at the hotel by the Health Protection Agency. The affected rooms on the eighth floor are still isolated, although the risk is pronounced minimal and the rest of the hotel has remained open.

1 November

Litvinenko and Scaramella meet at Itsu. Later, Litvinenko and the two former Russian agents meet at the Pine Bar at the Millennium Mayfair. Litvinenko's cup of tea (which he claimed was already on the table at the Pine Bar when he arrived) is highly contaminated. Seven bar staff are contaminated and the bar, a room on the third floor and the ground-floor gents are subsequently closed - and will remain closed for the next six months. That night, Lugovoi and Kovtun go to the Arsenal v CSKA Moscow match at the Emirates Stadium. Seats are later found to be contaminated.

What is polonium?

Polonium is a rare and highly radioactive metalloid and has been studied for possible use in heating spacecraft. It is most lethal when it is ingested. It has been suggested that chelation agents such as dimercaprol can be used to decontaminate humans.

Source: Wikipedia

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