A crisis-like situation confronting F&N Dairies in Malaysia?


Students of crisis and issues management as well as crisis communications should find this case interesting. This case came to Unspun‘s attention when Edward Skading posted a comment in this blog that says:

Dear Blogger,

Hello.

My name is Edward Skading and I am writing to seek your corporation and support to help me uphold our consumer rights against F&N Dairies’ Contaminated Condensed Sweet Milk – Tea Pot brand.

The full information is posted on my weblog http://consumersrighteousness.blogspot.com/. If you wish to contact me please send an email to eddskading@hotmail.com.

I would greatly appreciate your support to expose this incident to all Malaysians because it seems like most main stream media is not interested in this horrible discovery. I wish they would take notice.

I am also in the midst of being taken to court by F&N because of my determination for transparency and truth.

Please come forward and help me. I would greatly value it.

Thank you.

Yours truly,

Edward Skading

Unspun does not have all the facts at hand and cannot tell who is in the right or who is in the wrong here, but on reading Edward’s blog and the comments posted there, it looks like F&N Dairies is losing the image war and about to be taught a lesson on what damage one pissed off citizen with access to the internet and a few simple Web 2.0 tools can inflict on a huge corporation.

Edward, through his own description and photos, is an elderly chap. From the comments posted on his blof (contrived or real? who knows?) it also appears that Edward was a patriot who served his country in the Congo. Some commentators even called him a war hero.

Edward is also, for an elderly chap, very Web 2.0 savvy. In his blog are flash video clips of the allegedly contaminated condensed milk he purchased. He’s also uploaded a leaflet on Scribed giving his point of view and calling others to join in his “righteous” cause.

On the other hand (and here take things with a pinch of salt because the information is all from Edward’s blog) F&N Dairies seems to have taken the heavy handed approach to Edward’s complaints, threatening him with lawyers’ letters and a potential law suit. And in the letters they told him to keep things confidential, something that Edward has gleefully posted on his blog as well.

The F&N Dairies General Manager also apparently wrote to Edward telling him that “We are not liable for damaged products in the marketplace.”

If F&N Dairies has actually done what Edward has claimed they did, then they have been asking for it. They may take Edward to court and win in a court of law but they have already lost in the court of public opinion, and is unlikely to win there unless they have a major change of strategy. What did F&N Dairies do wrong?

From a Crisis Management point of view it would seem that F&N’s first mistake was not to take ownership of the product. It sought to blame any damage of the goods on market conditions. A basic lesson in crisis management is that if your brand is involved in any mishap you need to take responsibility for it, even though it may be someone else’s fault.

The second mistake F&N apparently did was to think that Edward’s persistent complain could be solved through a legal solution. This is a huge booboo. Large corporations have to think trice before suing individuals, especially if they are elderly with a war service record, because they become the classical Goliath bearing down on poor David in the public mind. To the public, F&N is now being perceived as arrogant and a bully. And Edward is now perceived as the persecuted underdog. So guess who the public will be barracking for? From the outset this was a public relations problem, not a legal problem. It is baffling why F&N chose to treat it as a legal problem.

If F&N wants to get out of this without further loss of reputation it must abandon its present strategy and seek professional crisis management help. With things starting to boil it must engage Edward and other bloggers who take up Edward’s cause. If need to they should eat humble pie, apologize and communicate to the public what steps they have put in place to ensure that something like this (the contamination – if it really did happen- and the reaction to Edward’s complaints) would not happen again. They’ve got to become part of the conversation or be a victim of the conversation.

F&N should also employ people who understand the web and see if Edward is using any sock puppets or engaging in Astroturfing (and if nobody there understands these terms its time perhaps for them to get younger people?) of the comments as part of its defense arsenal. If Unspun was a suspicious person he’s advice to check on the origin of that posting where the commentator identified a photo of Edward from a few decades back.

Or F&N can choose to hunker down, use their lawyers to wield the big stick and try to control a situation that will only escalate if they do not engage. The key word is engage. Whether F&N was right or wrong, and whether Edward was justified in his complaints or just being a difficult old man, is besides the point.

The point is that there are new rules at play here. It’s the Web 2.0 rules of crisis and issues management. More than ever the perception is more important than the reality. If F&N ignores this development then they are asking for a bollocking when the groundswell in the blogosphere inevitably occurs.

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