Q&A with Robert Luttrell on crisis management

1. What sort of crises have you been involved with?
Corporate restructurings, downsizings and closures, mergers & acquisitions, hostile takeover bids, product contaminations and recalls, extortion threats, industrial disputes, environmental disasters, litigation and prosecutions, kidnap and ransom - to name a few!

2. How did you get into crisis management?
I trained as a lawyer but moved into PR consulting in 1985. I then spent eight years with Prudential, a major insurer, before returning to consulting in 1997.

3. What makes your offering different to others?
My background enables to combine legal, communications and risk perspectives to provide holistic advice. Having been a Head of Corporate Affairs, I understand the challenges from the client side. As Director of Issues & Crisis Management at two global PR consultancies, I have had the experience of advising on a wide variety of challenging situations. Since setting up Luttrell & Associates in 2003, I have been brought in by leading consultancies to work on specific problems, as well as servicing my own client base.

4. What is the most common mistake organisations make?
Complacency – thinking that just because you are a good company, nothing will ever happen to you.

5. Who do you regard as good case studies?
Arnott’s, Sanitarium and MasterFoods are all leading food companies which have experienced product threats and emerged with their reputations not just intact, but enhanced because of the way they handled the situation.

6. Are some industries or companies more prone to crises?
We all put a high degree of trust in any product we put in our body, so food & beverages and pharmaceuticals are more susceptible. We also care about those who cannot make an informed judgment such as children and pets (eg toys affected by lead paint or pet food with melamine substitution). Products and services we all use will capture headlines and big brand names make big targets. Utilities and resources companies are often the best prepared. But a crisis can strike any company.

7. What impact do crises have on organisations and their stakeholders?
The Oxford Metrica study shows the impact on market capitalization between companies that handle crises well (recoverers) and those that don’t (non-recoverers) can vary by as much as 30 per cent. Most people associate crises with negative impacts, such as a financial loss, business interruption, damage to reputation and morale. Initially there is a sense of shock and disbelief within the organisation – this can’t be happening to us. Once people get over that, a crisis can be quite galvanizing as people pull together united in a common goal. A crisis puts a spotlight on a company and if it performs well it can strengthen its reputation.

8. Are there distinct patterns or phases to a crisis?
Yes, the first phase involves gathering the facts, analyzing the situation and deciding how to respond; the second phase involves an operational and communications response; this is then followed by planning for resolution and recovery.

9. What role do you play if an organisation finds itself in a crisis?
I usually advise the chairman or the CEO or work alongside the Heads of Risk Management or Corporate Affairs. Sometimes I act as a Planner, considering a range of scenarios as to how the situation might unfold so that the team is prepared. It helps when I have worked with the client so that I understand the culture, the personalities and the structures of the organisation beforehand but quite often I find myself parachuted in at the eleventh hour in which case I have to quickly establish what is required and how I can best add value. Clients generally find it extremely helpful to have someone who has been through a variety of crises and who can provide an objective, independent viewpoint.