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HUL vs Nestle: Going over their crisis management with a fine tooth comb

HUL vs Nestle: Going over their crisis management with a fine tooth comb

Author | Sarmistha Neogy | Thursday, Aug 06,2015 8:14 AM

HUL vs Nestle: Going over their crisis management with a fine tooth comb

The rap video, ‘Kodaikanal Won’t’ accusing Hindustan Unilever (HUL) to take action for the mercury poisoning which happened as a result of its thermometer factory has been in the news for the last couple of days. The rap song written and performed by Chennai-born rapper Sofia Ashraf, who is also an ex-employee of Ogilvy & Mather, has garnered more than 1.5 million views ever since it got uploaded by NGO Jhatkaa on July 30th and is taking the internet by storm.

View the video here:

The company has been prompt in issuing a statement highlighting that the safety of all the employees is their number one priority. Also they have always acted in a transparent and responsible manner ever since the issue first arose in 2001, when they immediately closed the factory and launched an investigation.

HUL has also provided detailed and clear, factual information on its website:

According to Anand Halve, Co-founder and Director, Chlorophyll Brand, a crisis situation can crop up anytime because bad news is always around the corner. “Therefore, companies need to concentrate on three most important things to tackle this. Firstly, there is a need to create a credible bank balance of goodness, which involves doing things that are not directly connected to your business. Like Dettol getting associated with the Swachh Bharat mission, will in the end mean, more sale of their products. So, sometimes, there is a need to give back to the society as well. Tatas have been able to build their image well in this regards, there are hospitals, schools and colleges all over the country. Secondly, you need to have a face for the good deeds done by your company. For e.g. Anand Mahindra is the face of the Mahindra Group. The reason behind this is when, people associate with goodness, and they need a face to connect with. However, most international companies don’t have a face in India. Thirdly, nothing will impact businesses; we Indians are ethically very ambivalent. The only thing which companies need to be worried about is, getting picked up by magnifiers.  But again, most of the crusaders in our country are only fighting for rivals and not for the common man,” he cited.

Did HUL handle their crisis better than Nestle India?

Handling any crisis period is quite a task for any company, no matter, how new or old your business is. There have been several reports accusing Nestle India for their incapability in handling the entire Maggi episode correctly. The company took time to respond and when they did their tone was very defensive as well as dismissive, which apparently backfired. The product was finally banned and Nestle India announced the removal of Maggi noodles products from the Indian market on June 5th.

Commenting on whether HUL by their prompt response has been able to handle the crisis situation better than Nestle, Rajiv Dingra, Founder & CEO, WATConsult said, “The only good thing about HUL’s statement is that they were quick, other than this, I can’t find anything. The statement is too long, verbose and legal; it completely lacks the humane touch. On the other hand, the rap video is made in such a manner that even a small kid can understand what the matter is all about. Who has the time to go through such a long statement, the trick is either you show something with your action or just reply in one sentence; both these things are missing here. Social media is buzzing with anti-HUL tweets and this statement has actually not done anything good to them. So if Nestle has been late and defensive in their tone, HUL is no better, it has been equally defensive, just that it was quick.”

Pranesh Misra, Chairman & Managing Director, Brandscapes Worldwide feels that HUL’s response is a well-thought out and drafted one because they had the advantage of time. The case is 14 years old and HUL team has already done all their ground work from before, so issuing a statement took no time. On the other hand, for Nestle, the Maggi crisis came out of the blue and usually in these instances, your tone becomes quite defensive when you are handling these things for the first time.

Echoing similar views, Pravin Thakur, Digital Media Consultant, ibrand explained that “When big brands goof up they already have their fire-fighting mechanisms in place. But no one will come out in the open and accept their mistakes. In a country like ours, brand image doesn’t get affected for long. In case of any crisis, the brand will formulate a strategy and recover. HUL was fast because they had all their documents in place and it was just a matter of pulling out the required data and issuing a statement. On the other hand, for Nestle, they were never expecting such a thing to take place. No one had ever imagined that a popular brand like Maggi will one day get wiped out. It was unexpected for them, and that is the reason, they had to discuss, deliberate and issue a statement, so it took time.”

Akshaara Lalwani, Founder and CEO, Communicate India feels that companies need to walk the talk rather than take a defensive mode when it comes to managing crisis situations. “The video seems to be a reaction to the frustration faced by the people of Kodaikanal and they need to be heard. There is a reason for this frustration, 14 years have gone by and nothing has been done. The statement issued by HUL on the hand is extremely defensive and they seem to be getting away from the situation. Here not only the company, but the PR machinery is also at fault; they should have checked things from before.”

She further added, “However, today in the race to add more clients to their kitties, PR firms often tend to ignore or overlook very important things. They should infact check from their end, if whatever the client is preaching is correct or not. Also companies need to keep in mind that they need to open all their cards in front of the PR right from day one and not expect them to suddenly act as a saviour when crisis has already hit them. The reason is, sometimes we are able to foresee certain things better and identify things which have the probability of flaring up.”

However, Nitin Mantri, President, PRCAI (Public Relations Consultants Association of India) and CEO, Avian Media pointed out, “The fact that HUL has responded quickly says it all. Whether it is right or wrong, I don’t know, but presenting their version, in a detailed and a transparent manner right in the beginning and also engaging with the audience is surely the correct thing to do in a crisis time like this.”

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