«13TH INTERNATIONAL PUBLIC RELATIONS RESEARCH CONFERENCE “Ethical Issues for Public Relations Practice in a Multicultural World” Holiday Inn ...»
Yet, the T-Mobile spying scandal was not one of the kind in Germany. In 2006, a parliament report accused the German Federal Intelligence Agency (the Bundesnachrichtendienst) of systematic surveillance on some reporters. The crisis ended when the government of Angela Merkel ordered the agency to stop. Additionally, the T-Mobile scandal occurred on a background dominated in Germany by crises of other corporate giants such as Siemens, the industrial and engineering electronics company based in Munich, accused of bribery, and Volkswagen whose reputation was tarnished by payoffs to union representatives (“Phone Giant in Germany Stirs a Furor,”2008, para. 15).
For T-Mobile and DT, the scandal can have a tremendous impact on their reputation at an international level. For example, the American media revealed that U.S. Federal Communications Commission could enter the investigation into Deutsche Telekom to see if the latter had been also spying in the U.S. Joe Nordgaard, director of the consulting firm Spectral
Advantage asserted with regard to Deutsche Telekom’s spying scandal:
Pre-texting is clearly against the law in the U.S. That was made clear in the HP scandal, but there are other complications stemming from the fact that Deutsche Telekom is part owed by the German government (Deutsche Telekom Scandal Could Spread to U.S., 2008, para. 3).
As a result, what first started as a crisis threatening the relationship of the company with the customers whose expectations with regard to confidential data had not been met, extended over a few weeks to a scandal between DT and its internal publics on one hand (the employees whose trust was betrayed by pre-texting) and a political one at an international level on the other hand.
To this time the crisis is far from being over and will probably come to an end when the decision of the German court will have been made. Up to that time, Deutsche Telekom adopts different strategies to prove its responsibility and regain the trust of its internal and external publics. Interviewed by The New York Times in May 2008, Mark Nierwetberg, the company’s
By handling over the information to the prosecutor, we are using the sharpest knife we have to solve the problem. We are not trying to hide anything.
The scandal that emerged compelled DT’s top management to face not only the internal and external publics that became suspicious of the telecom provider, but also the reluctant media to which it had to respond quickly in order to restore its image.
The T-Mobile’s crisis developed as a result of issues from within the system, i.e. from the frustration and the discontent of the employees. According to the chaos theory that was studied by McKie (2005) systems are characterized by instability and nonlinearity which makes it hard if not impossible to predict any possible issue that might rise and develop into a crisis. There is evidence that the management intentionally ignored the frustrations caused by the Deutsche Telekom’s plan to eliminate 45,000 jobs by the end of 2007. The service workers’ union, Ver.di 490 strongly disagreed by calling the Telekom’s plans “clear-cutting” and “an outrage scandal to employment policy (“Did Deutsche Telekom Spy on Journalists and Board Members,” 2008, para.2).
In 2006 the crisis became more acute as a result of the tensions between the member of the executive board Rene Obermann, head of the mobile division of Deutsche Telekom on one hand and Walter Raizner, head of the landline division on the other hand. While the two were deeply suspicious of one another and treated each other more like rivals than colleagues, information from within the company was slowly leaking to the press, revealing the discord within the corporation. At the same time, the environment in which the corporation was operating had started to change dramatically and landline business was facing growing competition from small upstart providers which declined the prices and sales. Additionally, the mobile telephony business was no longer achieving the growth rates. Yet, while competition was trying to come up with a strategic plan to face the new challenges of the business environment, the management of Deutsche Telekom was unable to agree on a strategy “Did Deutsche Telekom Spy on Journalists and Board Members,” 2008, para.2).
As noted earlier, in May 2008 the German newsmagazine Der Spiegel revealed that data about 17 million customers was available for sale online (Data on 17m Mobile Phone Users Stolen, 2008, para1.). The T-Mobile’s response was that, although the company had known about the information leak since 2006, they were using internal investigations to make sure that they would further prevent such situations. However, less than two weeks later, Der Spiegel published details with regard to the way Deutsche Telekom and T-Mobile had been coping with the information leak.
Further on, German Journalists from Der Spiegel managed to procure a fax that was sent to Deutsche Telekom and was addressed to the Head of Telekom’s legal department. The threepage document ended in a threatening tone: “you should not underestimate my aggressive potential and my staying power. “The fax came from the chief executive of a consulting firm in Berlin who had been allegedly hired to spy on the top management of Deutsche Telekom as well as the media that covered the corporation. The goal was not only to determine how internal information with regard to 17 million customers could have been disclosed but also how informational and strategic plans with regard to T-Mobile’s future actions that could affect the stock reached the press. The surveillance programs were called “Clipper” and “Rheingold” and the fax made it clear that the program involved monitoring phone calls of hundreds of thousands landline and mobile connection data sets of German journalists and their private contacts. The fax also stated that the same procedure was repeated with several board members on the employee side. The frustration of the chief executive of the consulting firm had stemmed from the fact that Deutsche Telekom had not paid for all the services his firm offered. The fax also included information with regard o spying on one of the Deutsche Telekom’s shareholders called Blackstone, headquartered in New York (“Germany Rocked by Telekom Spying Scandal,” 2008, para.7).
Der Spiegel newsmagazine classified the crisis as “an absurd concoction of economic spying, power-hungry megalomania, paranoia, and a complete disregard for the freedom of the press”, adding that “had it not been for the money, there is a good chance that the entire unsavory story would have never come to light” (“Germany Rocked by Telekom Spying Scandal,” 2008, para.2).
It is important to note that Der Spiegel was the media outlet that triggered and defined the 491 crisis first, therefore compelling T-Mobile to provide a crisis response and face a situation that would damage its image and reputation both at an external and an internal level.
William L. Benoit’s theory of image restoration (1995) states that organizations and
individuals employ the same limited repertoire of image restoration strategies:
Despite differences in how image restoration strategies might be selected, combined, or employed, however, the basic image restoration options are the same for both individual and corporate image repair efforts.
Benoit’s perspective on crisis communication is rhetorical and focuses on verbal strategies, more precisely on what people or organizational spokespersons say when they have been attacked. Therefore, the theory lays more emphasis on the sender of the message and does not take into consideration other factors. The key words of Benoit’s theory are: verbal defense, ethos, reputation, and image restoration discourse. For Benoit (1995) communication is goal oriented. Moreover, as soon as individuals establish goals and realize they are capable of achieving them, they engage in communication that would make them fulfill their aims.
Analogously, organizations engage in crisis communication with the goal of maintaining or restoring a good reputation.
According to the theory proposed by Benoit, an image is threatened: 1) when an undesirable or offensive act has occurred and 2) someone is holding the accused accountable.
The degree to which the act is offensive and the accuser is responsible plays a paramount role in how much the reputation of the accuser will be affected. On the other hand, whether the accused is responsible or not for the wrong doing is not important: so long as he is held accountable by publics he has to defend his reputation.
Furthermore, Benoit identified five strategies that help restore the image of an individual or
organizations, each of them being characterized by diverse tactics as follows:
Benoit’s (1995) theory shows that companies will engage in employing several strategies during one single crisis. For example, an organization could make use of both denial and bolstering to protect its image.
In contrast to Benoit, Coombs’s contribution to the crisis communication scholarship brought in a public relations perspective. Coombs and Holloday (2004) developed the Situational Crisis Communication Theory which, contrary to Benoit’s perspective, takes into account the role of the stakeholders during a crisis. Consequently, crisis communication is goal- oriented just as Benoit suggested, yet stakeholders play an active role in the crisis discourse and the rhetorical strategies become subtler when trying to reach the target audience.
Thus Coombs considered that the strategies a rhetor employs in dealing with a crisis should be a continuum, changing from defensive strategies that are used when he denies either that a crisis has occurred or that it has a great significance, to accommodating strategies that he uses when he has to take full responsibility for the act, ask for forgiveness and try to renew/restore his image.
The following chart provides the seven crisis communication strategies proposed by
organizational legitimacy, and the causal attribution. For Coombs, the relationship between an organization and its stakeholders is determined by a structural and a temporal dimension. The structural dimension defines the interdependence that characterizes the relationship between an organization who needs resources from the macrosystem in order to survive and the stakeholders who need the products or the services that the former provides them with. When he discusses the temporal dimension, Coombs introduces the notion of relational history by which he understands the actions taken by the organization in the past that are perceived by stakeholders as defining the values and characteristics of the organization. Therefore, a crisis is an unpredictable event, a relational damage or a phase in the ongoing relationship between the organization and its stakeholders.
Taking into account elements from the theories of Coombs and Benoit’s mentioned above, Finn Frandsen & Winni Johansen (2007) developed a model that makes allowances for all the publics that are either affected or affect a crisis. In the researchers’ view, once a crisis arises, “an arena opens with the public sphere of the society and/or the organization where various actors communicate with or against each other, to or past each other” (Frandsen & Johansen, 2007). The theory which they entitled Rhetorical Arena uses the notion of interdependence different than Coombs, more precisely it borrows the concept as used by Pompper (2005) when describing The Game Theory. Thus, interdependence transcends the meaning Coombs offered to the term and implies the fact that, before reaching a decision, organizations have to take into account what other persons and organizations do. Additionally, in the view of Frandsen and Johansen (2007), organizations are unpredictable systems whose behavior does not unfold in a linear cause-effect way. Therefore, at any time, organizations could face severe disruption and chaos may arise at any time. Consequently, the evolution of crises comes in contradiction to the Newtonian view according to which the universe is governed by predictable and stable laws.
In sum, the researchers make use of the game theory and the chaotic theory to develop
the following model:
Contrary to the model of Frandsen and Johansen (2007), who consider that context and media influence the image recreation discourse, the model proposed in this paper assumes that context and media can themselves be influenced by the corporate crisis discourse and undergo considerable modifications. The model dovetails with those analyzed by Benoit, Coombs, and Frandsen and Johansen. However, the model provides an in depth overview of the circumstances that determine a specific type of discourse and assumes that any speech delivered by organizational representatives before, during, and after a crisis is delivered with the intent of image restoration. In other words, the goal of the communication is image-oriented.
The fulcrum of the model is a relationship of interdependence between speaker, media, and publics. Yet the degree of interdependence and mutual influence is established by the context.
The model can be reduced to the following schemata:
When designating a person who would be in charge of media relations during a crisis, top management should take into consideration his or her training as well as the experience this person has in dealing with past crises. Choosing the right person who would face media could be a tough decision and should be made not only by considering his or her abilities and skills, but also by being sure that the person is representative of the organization, i.e. that he or she shares the values and the goals promoted by the company. Furthermore, a crisis can create “heroes” and the context might necessitate that the “hero” of the crisis should be the one to step forward and talk to the publics.