Case analysis of the Coca-Cola India Crisis
1. What are the key problems that Gupta should focus on in the short term and in the long term?
In looking at the situation, hindsight is always 20/20. Gupta would have benefited from the eight steps of crisis management.
Step 1: Get control of the situation.
Gupta needed to define the real problem, use reliable information, and a measurable communication objective for handling it.
Step 2: Gather as much information as possible:
Gupta quickly reacted to the situation without taking a fair and objective look at the facts in the statements being made. Gupta’s reaction was emotional and attacked the credibility of the Center for Science and Environment ( hereafter CSE).
Step 3: Set up a centralized crisis management center:
As Gupta was gathering the right information from the right people he should have made arrangement for creating a crisis center for the constituents, that is, media, employees, customers, and government. Creating a crisis center would have made Coke India look more sympathetic and human. Instead, Gupta went on the attack and published a letter that was callous and focused only on the potential impairment of business; not the safety of lives.
Step 4:Comminicate early and often:
Gupta should have made a plea in person especially since the crisis involved the threat to lives. He could have avoided any panic by hiring a public relations firm to assist him during this process. He should have expressed concern for the public safety rather than focus on profits and conspiracy theories.
Step 5:Understand the media’s mission in a crisis:
Gupta should have created an alliance with certain member’s of the media. A public relations firm would have been an asset.
Step 6: Communicate directly with affected constituents:
Gupta needed to communicate directly to his employees the position of Coke during this crisis. The employees were the mouthpiece to the community and the media. Everyone one needed a consistent story. Half-truths and rumors would only inflame the situation. Gupta also needed to consider which constituents were the top priority. Communicating with these constituents would filter the information that would be published. In this case, I believe he should have been communicating not only with the media but also with the government as well as any customers affected by the crisis.
Step 7: Remember that business must continue:
At this point Gupta needed to take a step back and look at which areas of the company will be most affected by the crisis. Are there certain divisions that are short handed because the impromptu crisis management team had taken them away from their usual duties? Did they need to start thinking about a promotional campaign to rebound from the situation? Did they have an exit and re-entrance strategy?
Step 8: Make plans to avoid another crisis immediately:
Gupta should have been somewhat prepared for this crisis because Coke has had similar incidents in the past such as the Belgium incident. They should have followed the lead of Coke Belgium by not only implementing an aggressive public relations campaign, but also put a crisis management plan and team in place while the motivation was still high to learn from mistakes.
Long Term:Gupta needs to integrate the eight steps of crisis management into a crisis policy. This policy should include a campaign to assure customers of continuous safety monitoring, as well partnering with the CSE, government and other evaluators, and regulatory organizations. Together they could create and implement a consumer safety policy. They should also have set up a public relations campaign that highlights combined efforts to exceed safety and environmental standards of excellence within the industry.
Short Term: Immediately there should have been a press conference with Gupta stating that they are doing everything imaginable...