Accentuate the Positive, 3.0

The NCAA hasn’t exactly had a great couple of years on the PR end of things, especially after losing a judgment against a coach wrongly labelled as a cheater (to be retried). That case threw the whole NCAA investigation and infractions committees into question.

Now the NCAA is making a foray into blogging… using interns.

Not sure that’s the right strategy. We’ll see how they do.

And it’s not mine.

It’s Wal-Mart.

I’ve told you the “Beast from Bentonville” wasn’t going to sit back and take the licks any longer.

Of course, it’s not hard to look good when compared to FEMA.

If you’re going to deflect a reporter to a spokesperson, make sure it’s not a dead end.

The board of directors of the Gloria Wise Boys and Girls Club in New York is on the hot seat. A former board member (who was one of the go-to-guys in launching liberal talk network Air America) is now being investigated for redirecting more than half-a-million dollars in grant money and “investing” it in the Air America startup.

Air America has been quick to point out that it is under new ownership, and has the appearance of deniability.

The current Gloria Wise board is running into trouble, though. Hugh Hewitt at the Weekly Standard tried getting some answers:

My producer and I have spent a lot of time trying to get a member of the board on the record about the investment. The only one who agreed to talk to us referred us to Rubenstein Public Relations. An assistant to Richard Rubenstein called me to relay that he didn’t know anything about the “Gloria Wise story.” Odd.

Either there is a huge disconnect in protocol at Rubenstein (which I highly doubt,) or someone is trying to buy some time.

To make matters worse, the article didn’t mention which board member had been approached, so now this little cloud of avoidance is hanging over all of them, until it gets cleared up.

We’ve seen in the Richard Scrushy case how important your pre-trial PR posture can be. Looking like you’re ducking tough questions is not the way to get there.

The Office of Corporate Counsel holds a lot of sway in many businesses, but isn’t immune to big PR blunders.

Many times, the office lawyer nixes promotional ideas for potential liability, and even parses your media communications for trivial little changes. That level of internal authority can give the J.D. a bulletproof mentality, especially when it comes to ignoring the expertise of the PR practitioner. Face it… when was the last time the boss told counsel to “hold off” while the public relations department pondered the action?

Well… it should have happened in Baltimore. A Greyhound bus crash injured 34 people there on Monday. While the victims were still hospitalized, Greyhound lawyers combed the hospital looking for people to sign a liability waiver — offering at least one person “medical expenses plus $2,500.”

I’m sure the corporate suits saw this as a no-brainer, and a way to avoid some costly suits. But the strategy did not sit well with passenger Chris Childs:

“I thought it was tacky. It basically matched how I feel about the company,” said Childs, 36, who has retained a lawyer. “I never figured somebody would offer you money on the day of the accident.”

Now, the company will spend an undetermined sum (in time and cash) to re-build a positive image. The bus crash is an accident, and can be forgiven. Sending the sharks into the E.R. is willful, and hard to forget.

In typical fashion, Greyhound’s PR representative had to clean up a mess long after the roads had re-opened:

When asked about Childs’ account, Greyhound spokeswoman Kim Plaskett said that any passengers who want to complain about customer service should call the customer-assistance line at 214-849-8966.

“I can’t confirm what happened in the emergency room,” said Plaskett.

“I can say Greyhound representatives did go to the hospital to make sure they were taken care of.”

…and in typical fashion, the Office of Corporate Counsel gagged her. Hey lawyer-types, when it comes to protecting corporate image, “leave the driving to us.”

Dear Mr. Scrushy:

Congratulations on beating the rap in your $2.7-billion accounting fraud trial. That is no mean feat.

However, there are a lot of people who are coming to terms with your acquittal, not ready to attach “innocence” to your name. Just ask Michael Jackson, who beat his charges, but was labelled as a “probable pedophile” by one of the twelve who set him free.

So, here are some things I recommend you do to repair your public image:

1) Be Gracious. Avoid speaking ill of anyone who wished you the worst. Keep the focus on you and your family. And take a vacation.

2) Don’t storm the citadel at HealthSouth. Yes, it’s your baby. Yes, as far as the law is concerned, you’ve been vindicated and have every right to reclaim your office. Don’t. They will make your return ugly. Express your relief that HealthSouth is on better financial footing. You can go home again, but don’t sour your public persona by running back inside today. That would look too greedy.

3) Do not cancel your “Morning Viewpoint” show. Too many people saw this show as a transparent ploy to recast your image. Prove them wrong.

4) Re-invest in the community. Yeah, a lot of organizations were quick to pull your name off those schools and buildings and streets and libraries that carried your name. That’s not what you need to re-approach. Let your next wave of philanthropy be quiet — let word of mouth carry the day. As long as you don’t appear to be “buying” good will, you’ll succeed. You lost a lot of people at once, you need to get them back one at a time.

As I write this, you are already putting some of this advice to use. I heard you say something to the effect of “We give all the glory to God, who gave me and my wife the strength to endure this torture…” It’s not enough to say the right things… you’ve got to live them over time. Just use the same discipline you did in the pre-trial phase.

Just be content to re-cast a new legacy. Leave the old one behind. There was too much baggage there anyway.

Trying to be fair, your pal…

Ike.

(p.s. — some of my friends reading this may have other advice for you too. They’ll add it to the comments section.)

Let the PR punditry begin.

The corporate fraud trial of HealthSouth founder Richard Scrushy is over. Verdict at 11:30 Central.

I’ve said before that he has to win in court, and in the court of public opinion.

We’ll see if he beats the first to have a chance at the second.

Tightest ship in the shipping business? Four million people might beg to differ.

CitiGroup now admits that personal information on 3,900,000 consumer lending customers is now floating around somewhere.

Unlike other security lapses, this doesn’t involve an internet transfer. Instead, Citi was sending a physical tape with the data to a credit bureau.

And UPS, which ships 14-million packages a day, just happened to lose this one.

Citi is doing its best to point the finger at UPS, even going as far as releasing a statement that is tantamount to a pink slip:

“We deeply regret this incident, which occurred in spite of the enhanced security procedures we require of our couriers,” Kevin Kessinger, executive vice president of Citigroup (Research), said in a statement. “Beginning in July, this data will be sent electronically in encrypted form.”

While this looks really bad for UPS for the time being, let’s put this in perspective.

First of all, this is not another one of those stories about an internet breach or a computer virus or a phishing scam that has put your personal financial information at risk. No one (as far as we know) set out to procure this stuff. It’s just lost.

Second, the odds of someone stumbling across the tape who can recognize what it is and have the appropriate equipment to read it is fairly small.

Third, has it occurred to anyone that maybe CitiGroup might be just a little behind the times here? Running large chunks of data through a sneakernet? I’m sure a secure intranet connection would be faster, with more frequent transfers. (I’ll bet a dedicated fiber line directly to Experian would be cheaper than this PR headache will be.)

I’d like to know how many other outdated and inefficient measures Citi takes with regards to my profile. Is the electronic transfer going to be any safer? Isn’t the use of couriers supposed to keep the hackers at bay? If electronic transfer is safer, then why has Citi been hoofing it? If the relative shift in safety is unknown, then why issue an immediate policy change? If one method is clearly safer than the other, why haven’t they been using it? If not, then why suddenly switch?

I know what Citi is trying to accomplish in retaining consumer confidence. But its actions come across as rather rash, especially when placed under responsible journalistic scrutiny.

Maybe it’s time to break down and buy identity theft insurance.

To save his reputation, ousted HealthSouth founder Richard Scrushy has to win in court twice — once in a court of law, and the other in a court of public opinion. It’s not enough to earn a mistrial or a hung jury. Getting off on a technicality won’t restore his luster.

Earlier this week, I documented the extent of his public relations campaign. In some respects, it’s all the old messages but done through alternate media.

The first part of that battle is leaning his way. Jurors have indicated they are deadlocked on the key charge of conspiracy. That bodes well, as it tends to hang doubt on all of the rest of the charges that follow. If you can’t prove he was part of the creation of the scheme, it’s hard to prove “what he knew and when he knew it.”

This blog is about media relations, and how shaping public opinion (through positive positioning) can help you. It’s also about how neglecting to defend your image can backfire.

So, why have I intentionally avoided the elephant in the room? My own backyard, even?

HealthSouth founder and CEO Richard Scrushy was on trial for his knowledge of a $2,700,000,000.00 (billion) accounting fraud. Over a number of years, HealthSouth fudged the numbers to meet Wall Street expectations. Fifteen former officers (including five CFOs) have reached plea agreements with the feds, in exchange for their cooperation against Scrushy.

(I will say that unlike the Enron’s and the Tyco’s of the corporate fraud world, HealthSouth was actually a profitable company delivering tangible service. Just not nearly as profitable as most were led to believe.)

The jury is now in its fourth day of deliberations, having to sort through 55 days of testimony and 6,000,000 documents. So again… why have I held off?

The Scrushy indictments and SEC hearings were among the last big stories I covered in my previous life as a journalist. That $2.7-billion figure came out of my addition and reporting. Needless to say, I know a heck of a lot about what prosecutors were up to, as they fought to freeze Scrushy’s assets. With my new job, I didn’t get the chance to directly see or hear a lot about what the defense was up to in the legal realm. But it’s been interesting to see what’s been happening on the public relations front.

I’ve maintained all along that Scrushy faces a monumental task: winning his freedom while keeping his reputation intact. He always had a corporate swagger of control, and was known for the degree to which he micro-managed certain aspects of HealthSouth. Richard Scrushy is a proud man, and intensely proud of the company he dreamed and established from nothing.

It takes a lot of moxie and ego to bring all of that together — and those are exactly the sorts of things he had to let go of during the trial. How can one maintain that reputation, when the defense amounts to a lot of “I didn’t know” and “I guess I’m not a great judge of character to have had such crooks in my trust.”

The Scrushy saga has been the elephant in the room — and now that it’s in the hands of the jury, I can feel more comfortable as an ex-journalist to comment. And this particular missive has to do with Scrushy’s playing of the race card. (I know what you’re thinking… what’s a white billionaire know about being black?) Throughout this ordeal, Scrushy has positioned himself as a simple man who grew up poor on the wrong side of the tracks in Selma, Alabama. A high-school dropout with no formal education, he made his way into the medical world as a respiratory therapist, married young with kids he could barely feed.

His attorneys have equated this to a civil rights case. Even now, you can’t find Scrushy walking to or from the courthouse without an entourage of black attorneys, pastors, and supporters. Some think the display a little transparent, and will not affect the jury (split 6-6 black and white.) Some point to the timing of Scrushy’s relationship with those inner city pastors, and a $1,000,000 gift he gave one influential congregation. Some even point to the executives Scrushy surrounded himself with, none of whom were black.

Richard Scrushy has spent a lot of time in and out of the courthouse on reputation managment. He and his wife Leslie did a religious talk show for more than a year, he had a website to refute the bias and false claims he saw in the media. From a trial standpoint, he bluffed jurors and reporters alike into believing he was prepped and ready to testify on his own behalf — which he ultimately did not do. (I for one was not fooled, and I have witnesses to back that up.)

The prosecution’s strategy was to play against Scrushy’s need to rehabilitate his public image. Play his own ego against himself. It’s not easy to win simultaneously in Federal court and the court of public opinion. We’ll see how it works out.

As a rule, I don’t generally try to rip off other people’s blogs, but B.L. Ochman’s “What’s Next Blog” has a great cautionary tale about getting too cute with your decorations.

Let’s just say that if you’re a major retailer trying to score major publicity at a media opportunity that you are in full control of… and that event involves dressing up the venue with a bunch of toilets… you really ought to let people know they aren’t hooked up to anything.

“We have had people use this nonfunctional bathroom all night, which does not even have any plumbing,” lamented Samuel Coplan, who helped install the display in the pre-fab rooms set up to showcase Target’s home furnishings. “Some poor [people] will just clean it up in the morning.”

We’ve documented the ins and outs of Wal-Mart’s shift in public relations strategy.
(That is, a shift from nothing to something.)

Since PR and marketing tend to be bigger losers when the economy and budgets tighten, we now have a classic laboratory case for just how much ‘media savvy’ is truly worth.

MSN Money asks the question, Can Wal-Mart’s PR campaign save its stock?

Also — with Wal-Mart now answering the challenge of its critics, will some of the heat transfer to other retailers?

CNN/Money looks at what could be the end of the free ride for Target.

When you’re as big as Wal-Mart, and you’ve been this silent for so long, the fact that you are talking is enough to make news.

The mega-mega-retailer is hosting a two-day media blitz in Bentonville, no doubt to start bending editorial ears to their spin on various issues.

For the longest time, Wal-Mart was able to enjoy the 8,000-pound gorilla position, and didn’t have to address critics. The corporate growth curve was still sharp and steep, and if it ain’t broke…

…we’ll know in the next few days about how well Wal-Mart’s spin legions are able to handle the pre-emptive counterstrikes. Labor organizations are feeding the media frenzy in the final hours, hoping to shape the debate.

This can be an effective tactic, when you know a competitor or adversary is on the brink of unveiling a new effort or campaign. At the very least, it projects your position as that of equal footing, and gives you at least a chance to frame the issues from your perspective.

Given the number of contentious issues that has hounded Wal-Mart in recent years (lawsuits over gender equity and the use of illegal aliens, predatory pricing practices, contracting out of the US…) this is probably a wise move. Any extra time Wal-Mart spends dealing with “labor-prepped” media will likely translate into extra ink. Even if the issue winds up being a wash, you’re still getting free publicity for your cause, and even re-energizing your own base.

What you do give up, though, is the chance to get the last word. Wal-Mart will likely counter with a series of talking points, and given the fact they’ve had years to work on them, they’ll probably be pretty good ones. That’s a trade-off you have to consider when you time your releases and points to meet the other guy’s calendar.

Conservative commentator and talk show host Armstrong Williams got his hand caught in the cookie jar.

USA Today broke the story Friday morning, detailing how Williams’ company got a $240,000 contract from the US Department of Education to highlight the advantages of the No Child Left Behind Act.

The contract, detailed in documents obtained by USA TODAY through a Freedom of Information Act request, also shows that the Education Department, through the Ketchum public relations firm, arranged with Williams to use contacts with America’s Black Forum, a group of black broadcast journalists, “to encourage the producers to periodically address” NCLB. He persuaded radio and TV personality Steve Harvey to invite Paige onto his show twice.

White House spokesman Trent Duffy said he couldn’t comment because the White House is not involved in departments’ contracts. Education Department spokesman John Gibbons said the contract followed standard government procedures. Gibbons said there are no plans to continue with “similar outreach.”

Williams’ contract was part of a $1 million deal with Ketchum that produced “video news releases” designed to look like news reports. The Bush administration used similar releases last year to promote its Medicare prescription drug plan, prompting a scolding from the Government Accountability Office, which called them an illegal use of taxpayers’ dollars.

Forget the ethical problems involved here. This is precisely the kind of trouble you can expect to get into when you aren’t careful about the multiple hats you wear. Williams deserves to be scolded, if for no other reason than for being stupid about how things will look under public scrutiny.

Kurt Busch is a NASCAR champion, who was just a punch or two away from being the next Ron Artest.

Fortunately, some of his big-money sponsors saw the light, and staged a media training intervention.

Youth + speed + high exposure can be a formula for a real car wreck… it can also be a recipe for a media relations nightmare. If proper media training is lacking in your marketing plan, you run the risk of countering your own message.