In my blog posts of 15 September 2009 http://deonbinneman.wordpress.com/2009/09/15/product-recalls-done-properly-reduces-reputation-risk/ and http://deonbinneman.wordpress.com/2010/01/25/is-your-company-ready-to-deal-with-a-product-recall-a-checklist-for-your-convenience/; I discussed the importance of product recalls and the type of planning and preparation that needs to be done to make this process a success.
The following video, although of low quality is a must watch and features Bob Eckert, CEO of the world’s largest toy manufacturing company and he has some real lessons to share about this process, including some real reputation risk reduction lessons using adequate communication and crisis preplanning and the risks that emerge from subcontracting.
Those readers who are interested to learn more about product recalls and the steps needed to prevent unnecessary reputation risk, will want to attend a special workshop that will be held on the subject at the end of July in Johannesburg, South Africa.
|What:||27 July – A Product Recall Workshop (Planning for and Managing a Recall)
The challenges of dealing with a product recall is immense and resource challenging. Not only is there the challenges of dealing with the recall itself but the challenges of communicating with all stakeholders and minimising reputational fallout is high. The Toyota and now wider recall issues in the motor vehicle industry (Honda, Land-Rover, etc) is serving a warning to other operators and manufacturers in other industries of the need to prepare for a recall long before if it happens. The issues in dealing with a recall goes back long before the actual recall event. Prior preparation, risk management, attention to quality and communication issues need to be addressed, and will be scrutinised if such a recall ever takes place. Since a recall is always a possibility despite of quality controls and risk management, companies are well advised to plan to handle potential recalls well in advance, as handling product recalls professionally can go a long way to safeguard reputation.
|When:||Tuesday, July 27, 2010 (all day)|
Johannesburg, Gauteng South Africa
Got a random call the other day from a Powerlines reader who asked me how I would critique a Crisis simulation exercise.
Here is an extract of my partial response:
I try and always facilitate a process with the group after a simulation to process the learning experience after a simulated crisis.
This involves each person providing a 2 – minute feedback about how they experienced the simulation, what they believed went well and the areas necessary for improvement as well as completing an exercise critique form.
Apart from their feedback, this is what I will be looking for during a simulation:
- Adherence to plans - I will need to review the plans beforehand, and verify adherence to plans during the exercise (but see below)
- Improvisation – cautiously review any improvised steps and assess these against:a) divergence from plans, i. e. have plans turned out to be dysfunctional, b) personalities, i.e. have individuals improvised to the benefit of the organisation
- Behaviour and personality interaction- how do people react to the challenge, albeit simulated. IMHO this is the most difficult area to look at, but it is something that must be done to reflect on people’s abilities.
- Outcome – how did the organisation perform against pre-set expectations or defined outcomes.
- Discontinuities – failed, aborted, modified exercises, or generally the underlying reasons for an exercise that went wrong.
What do you look for?
There is a full page spread today on page 16 of the Star newspaper featuring an advertisement by Aspen Nutritionals entitled ‘’ASPEN’s S26 ASSURANCE OF QUALITY’’
Obviously such an advertisement is costly, but what is more important? Protecting your Reputation or the cost? The advertisement clearly spells out what makes the product great.
See also statement: Aspen Pharma – News Room – Quality of S-26 in South Africa Guaranteed http://bit.ly/T2JG2
The Tanzanian Health authorities recently withdrew S26-1 from the market in that country following 4 complaints regarding the quality of the product. The advertisement spells out the reasons – possible counterfeiting and non-adherence to required storage conditions. It further states that Aspen is actively investigating the matter and will take measures required to ensure the matter is managed.
This example offers a number of lessons for companies and Leaders:
1. Is your company prepared for a crisis? Crisis can come in many shapes and sizes, from life safety to product safety crises to just plain allegations and rumours. Have you done your homework about what could go wrong and planned the relevant response? Realise that planning for a potential crisis, actually start when you launch a product.
2. In any crisis, there are a number of communication challenges. Have you planned your messages and with whom you need to communicate and on what basis?
3. Has your organisation actually simulated, tested and had your crisis plans audited by a 3rd party to provide objective oversight?
Research shows that those companies who respond quickly and decisively in a crisis**, weathers the storm best.
How prepared are you?
** REPUCOMM – my consultancy has a Crisis Management & Crisis Communication Toolkit available for purchase. This toolkit available as a download or on CD contains all the necessary information to design, develop, write and test a crisis management & crisis communication plan. It provides a fast start and could make the difference between failure and success.
Depends though on a simple premise. What do you cherish the most – Your Reputation or the cost involved in planning and prior preparation?