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Meltingpot PR

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Armand Margaux

on 18 March 2015

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Transcript of Meltingpot PR

Key figures & Corporate Communication
General Motors at a glance
exist to earn customers for life

to design, build and sell the world’s best vehicles

Value & reputation:
- Delivering vehicles with compelling designs
- Flawless quality and reliability
- Leading safety
- Fuel economy
- Infotainment features.
- Delivering the world best vehicles
- Long-term relationship with customers
Founded in 1908 by William Durant, GM is the leading automobile manufacturer specialized in manufacturing cars and trucks.

Brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Oldsmobile, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. - Branded Strategy, Wally Olins Framework (1978)

Key figures:
- Over 202,000 employees
- 396 facilities on 6 continents
- 21,000 dealers across 120 countries
- Revenue: £155.93bn
Issues & Crisis Types, Response Strategies
Crisis Communication
Response strategies
Wednesday, March 18, 2015
Tatiana Typaldos Margaux Armand Natalie Lewkowicz Paul Antauer Anthony Mukoro
General Motors Recall Scandal
Meltingpot PR
"There is no conclusive evidence that the defect condition caused those crashes." Alan Batey, EVP
Reputation after the scandal
In 2001
Accident issue
In 2014
Transgression crisis

Full apology

Loss of trust by stakeholders
Brand reputation tarnished
Fall in sales
Legal liability from government and victims
Old GM vs New GM
Crisis Output
Culture changes
Work together as the new working philosophy
"We had more of a cost culture, and now we have a customer culture that focuses on safety and quality."
CEO Mary Barra
Corporate reforms
Association Press (2014), ‘GM: Parts are ready to fix recalled small cars’, CBS News, 1 October. Available at: http://www.cbsnews.com/news/gm-parts-are-ready-to-fix-recalled-small-cars/ (Accessed: 4 March 2015).
CORNELISSEN, J. (2014). Corporate communication: a guide to theory & practice, 4th edn. London: SAGE.
Colvin, G.(2014) ‘Mary Barra's (unexpected) opportunity’,
The Finance
, 18 September. Available at: http://fortune.com/2014/09/18/mary-barra-general-motors/ (Accessed: 11 March 2014).
GAMBETTI, R., & QUIGLEY, S. P. (2013). Managing corporate communication: a cross-cultural approach. Houndmills, Basingstoke, Palgrave Macmillan
General Motors (2015)
About us.
Available at: http://www.gm.com/company/aboutGM/our_company.html (Accessed: 5 March 2015).
General Motors (2015)
General Motors Company 2013 Annual Report
. Available at: http://www.gm.com/content/dam/gmcom/COMPANY/Investors/Stockholder_Information/
PDFs/2013_GM_Annual_Report.pdf (Accessed: 5 Marche 2015).
IndustryWeek (2014) ' Available at: http://www.industryweek.com/quality/ceo-mary-barra-driving-culture-change-general-motors (Accessed: 14 March 2015)

New York Times . (2014). Highlights From House Hearing on G.M. Defects. Available: http://thelede.blogs.nytimes.com/2014/04/01/live-updates-from-house-hearing-on-g-m-defects/?_r=0 . Last accessed 10th March 2015.
Mishandling Of Ignition Recall Risks GM's 'New' Reputation - Forbes. 2015. Mishandling Of Ignition Recall Risks GM's 'New' Reputation - Forbes. [ONLINE] Available at: http://www.forbes.com/sites/dalebuss/2014/02/27/mishandling-of-ignition-recall-risks-gms-new-reputation/. [Accessed 8 March 2015].
Plumer, B. (2014) ‘GM’s faulty ignition switches.’,
, 3 October. Available at: http://www.vox.com/cards/gm-car-recall/why-is-gm-recalling-so-many-cars (Accessed: 4 March 2015).

Lets Evaluate
What they did right
Start communicate more about what happened and talk more about present and future projects.
Media Relations Techniques:

Start to use different mediums to communicate with its customer before anyone else (printed, TV talk show, press conference, press release)
Accommodative Strategies:
Quicker response teams within organisation
Stakeholder Management Theory:
Reach out to second or third owners
Be more prepared by building a 5 Step Contingency Plan:
1. Publish regular reports/investigations on design, manufacturing and engineering
2. Provide regular written or oral update by the legal staff for relevant engineering groups on alleged or potential defects
Regular drills and enforcements in place - natural and human errors
3. Design a prompt recall department
4. Communication between all stakeholders, prioritise high interest and high power stakeholders with correct information
5. Provide psychological support services for victims and families

Incident Management

"Recalls were not being done in any particular order, but rather were ordered as soon as the relevant data was discovered. When it was clear there was an issue, we acted,” said James Cain, the G.M. spokesman.
CEO, Mary Barra, as the head spokesperson for more credibility with the general public and the media
Embarked $1.3 million into the recall
Recall back to 1990
Responsible Job Cuts

What they did wrong
No contingency plan/crisis response strategy plan
Late communications response
Lack of communication with stakeholders about facts: victims, shareholders, Government, the media.
1. GM's crisis may have been detected at an early stage but was poorly managed.

2. The preparation for the crisis happened 10 years later (Immediate action needs to be taken)

3. False technology of GM's cars was replaced too late and 28 million cars were pulled off the market in total. Having to recall this many cars puts the organization in a bad light.

4. Internal company changes, public statements and donating a fund of $1.3 million help GM to regain their reputation.

5. GM has to deal with federal investigations that forces them to make changes and improve their business.
Faux pas
Valukas report on gm redacted pdf

Stockholders and Investors
Communities in which GM operates
Governments at the national, state/provincial and local levels
5 stage contingency plan
Stage 1
Minimal Planning
Stage 2
Extensive planning
Stage 3
Training for 'expert staff'
stage 4
quality control
Stage 5
Risk Management
Primary stakeholders
Total recall of 28 million worldwide
Tried to hide problem for ten years
Lied to stakeholders
Facing federal/ criminal probe and congressional investigation
Re-use of faulty ignition switches
3,866 injury claims
479 death claims
Taken responsibility for 13 deaths (not responsible for passengers)
faulty ignition switches Cut off air bags and engine
Rejects proposal to fix problem because too costly and take too long
'No keyrings' 'Too short' Problem fixed? NO
Mary Barra becomes CEO - Problems became public

p.1: GM at a glance
p.2: What happened
p.3: Crisis communication - crisis types & strategies
p.4: Quote of Alan Batey
p.5: Crisis output
p.6: Reputation after the scandal
p.7: Let's Evaluate
p.8: Recommendations
(Cornelissen,2013, p.206)
Issues & Crisis Types
(Cornelissen,2013, p.206)
(Cornelissen,2013, p.208)
(Cornelissen, 2013, p. 187)
(Cornelissen, 2013, p.50)
New safety leader, Jeff Boyer
Creation of product integrity team
Senior leadership changes
(IndustryWeek, 2014)
What happened ?
Full transcript