How a difficult situation could have been handled better

Manners and Etiquette 10 Comments

In the modern business climate, manners and etiquette are a crucial aspect of maintaining a positive corporate reputation – especially in the course of handling difficult issues.

Good manners cost next to nothing. Yet a little courtesy goes a long way.

Last month in my neighborhood there was a perfect example of a situation which was handled poorly but could have easily been handled better with a little effort – much better.

The situation in question concerns the closure of the Croydon Market, a flea market which operates not far from my house in an undercover car park area adjacent to the Centro Croydon shopping centre.

PCL Prattcorp, which bought the shopping centre and the market site in May, closed the market last month, apparently citing concerns relating to insurance and safety (refer article).

 
A badly handled situation
This was never going to be an easy situation. The market opened in 1908 and has been operating in its present location since the end of World War I. Its closure was always going to be met with sadness. Not to mention the impact on stallholders, who depend on this market and other markets for their livelihood.

But what made things worse was PCL’s handling of the situation. Rather than being given advance notice of the closure, stallholders were not told at all. Instead, on Sunday June 28, they loaded up their gear and made the trip to market as normal, hoping for a good day of sales. (Some came from as far away as Horsham, four hours to the west, where markets had been held the previous day.) Alas, they arrived to find the gates closed and security guards turning them away. Their entire effort had been wasted. Worse still, those dealing in perishables were left with unsaleable stock.

Hardly any better was the company’s handling of the media. Enquiries from the Maroondah Leader, a local newspaper, were referred by PCL’s head office to management of the centre itself. Centre management, in turn, handballed those same queries back to head office. No one, it seems, wanted anything to do with this.

 
What should have happened
This situation could easily have been handled better with only a small amount of effort on the part of PCL.

Two simple steps would have gone a long way:

 
• Advance notice.

Giving stallholders advance notice of the closure would have been basic common courtesy.

Even a short period of notice – say, six weeks or even a month – may have enabled stallholders to arrange to set up at different markets in alternative locations, thereby minimising the disruption of the closure to their operations.

Advance notice would also have allowed them to clear unsold stock in the final weeks of trading.

(Even if safety concerns were a factor in the decision, as the company insists, the suddenness of the closure hardly seems necessary. The market has been operating in the same location without incident since World War I, surely it has not suddenly become so unsafe to the point of needing to be closed without advance notice.)

 
• Coordinated media strategy.

Given PCL’s size – it paid $31.5 million Australian dollars [$USD 26.5 million (approx)] for the centre – its absence of a strategy for handling media enquires is staggering.

It would not have been hard, for example, to prepare a short media statement about the closure. Nor would it have been difficult to arrange a designated contact point for media enquires. Yet either of these measures would have gone a long way toward making PCL look more professional.

(The company did make a media statement in the end. But that did not come until July 02 – almost a week after all the drama. Too little, too late.)

 
Simple steps, big impact
None of this would have been hard or costly. But better handling of the situation would have gone a long way toward enhancing PCL’s reputation.

Stallholders are businesspeople, and have a right to expect advance notice of decisions affecting their operations.

Moreover, the poor handling of this situation reflects badly upon PCL as a company, and this has adverse consequences for the company in terms of community reputation and staff morale. Pity. Even a little forethought on its part would have made a world of difference.

Etiquette and manners are essential when dealing with difficult situations.

Thoughtfulness and consideration hardly cost anything. But a few simple steps can go a long way.

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BP: How well intentioned statements became insults

Manners and Etiquette 11 Comments

There are a number of lessons to be learned from the current disaster surrounding BP and the oil spill in the Gulf of Mexico.

The most obvious (and most important) of these relate to the importance of disaster management planning and disaster prevention strategies.

But one interesting facet of the debacle is how some public statements made by the company have been well intended yet served only to inflame public anger.

Three examples stand out:

• Chairman Carl-Henric Svanberg’s declaration, made after a meeting with President Obama on June 16, that, “We care about the small people”;
• Chief Executive Tony Hayward’s lament last month that, “I want my life back“; and
• Hayward’s earlier comment about the size of the spill being ‘tiny’ compared to the size of the ocean.

 
Fine intentions, bad wording 
Each of the above statements were made out of good intention. Svanberg was simply trying to assure residents in affected areas that the company was taking their concerns seriously. Hayward, too, was trying to apologise for the disruption which the spill had caused to people’s lives.

But none were appropriate. Rather, each served only to cause offence.

Rightly so, too: references to ‘small people’ are rarely well received (Svanberg later recognised this apologised for his comment), and Hayward’s choice of words was dreadful – especially in light of the death of the eleven workers and the impact of the spill on so many lives. As for Hayward’s earlier comment about the size of the spill – that pretty much speaks for itself.

To be fair, given the extent to which BP execs have been under the pump, it was perhaps inevitable that some poorly worded statements were going to come out. And it should also be acknowledged that not even the best worded of statements would have done much given the magnitude of this disaster.

But that is no excuse. Well intended though they might have been, none of the above statements were appropriate. It is right that they backfired.

(It is also right, given the scale of the disaster and BP’s poor handling of the situation, that public anger against the company continues to grow.)

The lesson is clear: efforts to soothe public anger can easily have the opposite effect – especially in a crisis situation.

Choose your words carefully!

 
P.S. I cringe whenever I hear terms like ‘small people’ or ‘little people.’ Regardless of how well intentioned they might be, these terms are patronising and offensive. They have no place in good English usage.

No matter who they are or where they come from, each and every person is important. So too is each and every family, community, region or country. No one should be thought of otherwise and good language usage should reflect this.

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The importance of shareholder manners

Manners and Etiquette 6 Comments

A company’s annual general meeting is the only time that individual shareholders get to have their say, so it’s not surprising that some use the occasion to voice their frustrations or grievances.

So they have every right to – it is their company.

But problems arise where shareholders abuse this privilege.  One such case occurred at a meeting which I attended in Melbourne last month. This case highlighted the need for shareholders to observe reasonable manners and etiquette – even when voicing grievances or frustrations.

Shareholders have a right to challenge directors on tough issues. They have no right to make unsubstantiated allegations or personal attacks.

 
Drama at the Orica AGM
The drama took place at the annual general meeting of Orica Ltd, a multinational Australian company which manufactures a range of chemical products, during the discussion about the financial, directors’ and auditor’s reports.

One speaker, ‘Clancy,’ launched a tirade of disparaging remarks. (Real names have been quoted here since a podcast of the entire meeting is on public record on the company’s website)

He began:

“Yeah last year I raised the issue of (accounting firm) KPMG carrying out a false audit of this company ..”

In his one minute denunciation, Clancy went on to allege that:

• KPMG were ‘still’ issuing false audits of the company.

• Don Mercer, the company chairman, “should be in jail with Karl Williams” (a notorious Melbourne gangland figure)

• Mr. Mercer was part of the Melbourne business set – “the largest crime syndicate in Australia.”

• Mr. Mercer and others had only gotten away with it (his alleged criminal behavior) because of Managing Director Graham Liebelt’s friendship with former Australian Treasurer Peter Costello, who “looked after the Melbourne business set” and was “the most corrupt politician to sit in politics in Australia.”

(There were never any suggestions of impropriety by Mr. Costello throughout his eleven years as Federeral Treasurer of Australia between 1996 and 2007)

 
Allegations in context 

To put these claims into context, a number of points should be noted.

First, Clancy did not provide or refer to any form of evidence in support of his allegations.

Second, Mr. Mercer enjoys an outstanding reputation within the Australian business community – earned over many years of service on the board of a wide range of high profile Australian companies.

Third, immediately prior to Clancy’s attack, a representative from the Australian Shareholders’ Association had given the company a glowing report on a number of corporate governance related matters, saying that the ASA “could only be complimentary,” and that shareholders should be “very satisfied.”

In short, these were nothing more than wild allegations.

 
Let’s hold off on unsubstantiated allegations
Shareholders are the collective owners of the company – by whom directors (and senior executives) are employed and to whom they are accountable.

They have every right to voice their frustrations or concerns, just as they have every right to challenge directors on areas where performance or behavior have not been up to standard. They need not be ‘nice,’ and should not feel under any restraint toward asking difficult questions. The annual general meeting is there chance to do so, and they should not hold back.

But there are limits. Directors have a professional relationship with shareholders and deserve to be treated accordingly. This means answering tough questions, but not putting up with unwarranted personal attacks, unsubstantiated allegations or defamation.

In the case of Orica, Don Mercer did not seem overly worried about the whole situation. He’s been around the traps a long time – this was water off a duck’s back to him.

Nor did many of the other shareholders attach a great deal of credibility to Clancy’s allegations.

Nevertheless, board members should not have to put up with this kind of thing.

Shareholders must be free to challenge directors or make their feelings known.

But they have no right to make personal attacks or unsubstantiated allegations – directors should not have to put up with these.

 
Over to you
What are shareholder meetings like in your country?

Are they generally productive in terms of giving shareholders a fair opportunity to voice their concerns?

Are shareholders generally polite and well behaved?

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