Worst-Case Scenarios
Be open, honest and prepared if foodservice crisis occurs
By Jon W. Drummond, Special to R&I -- Restaurants & Institutions, 3/15/2004
When operators of a steakhouse chain enlisted David A. Fuscus and his public relations firm to manage fallout from an E. coli outbreak, a team from the agency was on the phone in minutes and on site the next morning.
When clients call, he and his associates can walk into a company storage room, grab one suitcase packed with their clothes and another containing a laptop and office supplies, and step out the door in minutes.
Fuscus has to be ready for crisis management because, he says, many foodservice operators are not. “Most chains—other than the super chains—haven’t given this a lot of thought,” says Fuscus, CEO of Xenophon Strategies, a Washington, D.C.-based public relations firm specializing in corporate crisis counseling. Xenophon partnered with the National Restaurant Association (NRA) to create a crisis-support program (www.crisissupport .com) tailored to the foodservice industry.
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“In comparison to other industries, the restaurant industry is less prepared to handle a crisis,” Fuscus says. “Overall, the food industry is a three on a scale of one to 10, with airlines at nine and the petroleum industry closer to 10.”
Problems foodservice operators face range from labor unrest to immigration raids, product recalls to natural disasters. Fuscus defines a crisis as “anything that can happen that can affect your business—meaning your sales and your brand.”
Among his foodservice clients, chains tend to be most interested in setting up a precrisis plan, while independent operators most often call after a problem occurs.
The need for speed
“You tend to find, with any crisis, that things spiral
out of control very quickly,” says David Watson, who
guided Irvine, Calif.-based Chi-Chi’s response in November
2003 when health officials linked hepatitis A with the chain’s
unit at Beaver Valley Mall in Monaca, Pa. The outbreak resulted
in three deaths and sickened more than 500 in Pennsylvania.
“We were called in to put a cap on it,” recalls Watson, director of corporate branding for CCG Strategic Communications in Sherman Oaks, Calif. He said a CCG team was in Pennsylvania with a detailed action plan in less than 24 hours. “Take control of the situation as soon as you can,” he advises. “Get the facts out there.”
Hampering the company’s efforts, Chi-Chi’s had filed for Chapter 11 bankruptcy protection a month before the outbreak and needed court permission to take actions such as paying for medical expenses. “They did not have a normal free hand,” he says.
Health officials eventually traced the Chi-Chi’s contamination to green onions from a Mexican supplier. Once the Pennsylvania Department of Health cleared Chi-Chi’s of any wrongdoing, Watson says the company wanted and needed to express contrition to customers and employees.
It helps to have a company officer who is comfortable
in front of cameras and reporters. Watson believes the chain
was lucky
to have Chief Operating Officer Bill Zavertnik in charge.
Zavertnik has been with the company for 20 years and started
as a restaurant
general manager. “Bill is local. This hit him hard. It
was obvious that he cared,” says Watson.
After 10 weeks, Chi-Chi’s officials decided to reopen the Beaver Valley location. On the big day, the wait for a table was up to three hours long as customers came out to show their support.
“In the modern world you need to move very quickly because the media works very quickly,” says Fuscus.
Basic training
“It’s pretty easy—and not that expensive—to
be prepared,” says Susan Tellem, president and CEO of
Tellem Worldwide, a Los Angeles-based public relations agency.
She believes foodservice is not prepared for a major mad cow-like
crisis, although larger operations are cognizant of the need
to be ready.
“I think we as an industry are well prepared to deal with a crisis,” says Kristin Nolt, NRA senior vice president of marketing, communications and media relations. “The silver lining in the nation’s recent crisis events is that they prompted our industry to be even more proactive in the area of crisis preparedness.”
Tellem recently created a food-issues group within her agency. Services include crisis planning, safety training, video production and bioterrorism education. Two major components are a crisis-preparedness survey and a vulnerability audit. The survey evaluates a client’s ability to respond to a problem and the audit looks at the operation to determine its most vulnerable areas. She helps companies brainstorm for worst-case scenarios and advises them to stage drills and mock press conferences.
“We stress that 50% of what you need to do can be done in advance,” says Dan Murphy, vice president of public affairs for the Arlington, Va.-based American Meat Institute (AMI), a trade group for an industry that has seen its share of crises. The AMI Web site (www.meatami.com) dedicates space to crisis-management resources, including possible scenarios, sample press releases, tips for media interviews, and a preparedness checklist.
Audience management
Once a crisis occurs, Tellem suggests companies examine
the audiences that will be looking at them—customers, employees,
vendors, government officials and the media. “A company
often doesn’t think about all of its audiences,” she
says. “You have to prepare for each one.”
Of all audiences, start with the media, says Wendy Lane of Portland, Ore.-based Lane Marketing Communications. “Always tell the truth, and tell it often to all of your audiences,” she says.
Notifying health officials usually isn’t a problem, Fuscus says. “With outbreaks, the health department contacts you.”
He recommends dedicating a team member to act as a government liaison to keep information flowing both ways. He also advises bringing in food scientists and other independent experts to find the problem and review the company’s practices.
If someone seems determined to paint an operator as the villain, Lane suggests staying truthful and calm. “Don’t get emotional,” she says. “No snide comments. Just facts. Get the message to your audiences. Your only cover is the truth.”
One of the first things Fuscus tells his foodservice clients is that every crisis has a lifecycle and they can recover. Jack in the Box restaurants overcame an E. coli outbreak in 1993 that killed four children and sickened an estimated 700 people in four Western states. Following the crisis, the company was recognized for taking strides in food-safety testing and employee training.
After any crisis, a company should take high-profile action to restore public trust, Tellem advises. “Do something visual to help the public see that the restaurant is clean.”
She tells of one case involving the discovery of restaurant workers who contracted the hepatitis-A virus. Although health officials determined the virus was limited to two employees and there was no need to close the restaurant, sales had dropped 80%. “So we hired a crew to scrub the unit clean,” she recalls. “Of course, we invited the media.” Within a month, sales were back to normal.
“Whatever the crisis, probably half of a company’s ability to manage the damage falls on the front end,” AMI’s Murphy says.
The need for preparedness is one reason NRA created its crisis-support program with Xenophon, says Nolt. “We recognized that many restaurants are understandably focused on running their business and keeping customers happy and coming back, and they might not focus on crisis planning until a crisis hits,” she says.
Nolt acknowledges that chains lead in planning, but a number of independent operators also seek the NRA’s help. “Because of their size and the potential for a crisis to escalate geographically due to brand identity, multi-unit operators tend to incorporate crisis management into their overall operations plans,” Nolt says. “One reason they do so is because they typically are able to devote more time, resources and staff in this area.”
Jon W. Drummond is a Chicago-based freelance writer.
Crisis basics
Below are tips from “Protect: Crisis Support for the Restaurant Industry,” sponsored by the National Restaurant Association. Find more at www.crisissupport.com.
PREPARING FOR A CRISIS
MANAGING THE SITUATION
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