Optus Company: Organizational Public Relations Problem

Introduction

In the conditions of a sharp aggravation of competition and the diminution of the influence on its outcome by the price factors, the position of the separate companies mostly depends on the efficiency and the quality of their personnel’s work.

Modern management should consider comprehensively the essential growth of the value of “the human fund” in the activity of firms and simultaneously radical changes its quality. One of the priorities and, perhaps, the most complex direction in the communicative strategy of the company is the image policy. As a practice, nowadays, the reputation of the company, in other words, its image, is defined as one of the major factors that promote victory or defeat in business and public life.

It should be followed that there are situations that could affect the image of the company that could be called crises, or revise the position of the company to negate the harmful effect. In this context, this report presents an analysis of the organizational PR problem of the company “Optus” based on media articles that followed particular “crisis” situations providing recommendations on managing those issues.

Problem Overview

The series of articles that recently covered “Optus” in the media followed technical outages of telecommunications networks and public and financial consequences that resulted from such incidents. The articles in general were a representation of public opinion as a reaction to the incidents themselves or the official statements made by the company regarding its position. As a result, the company aside from the financial losses resulting from paying compensations to the parties involved risks harming the company’s reputation.

As the technical flaws are unpredictable events the major problem in this situation is the PR management regarding organizational issues (crises). Thus, in this case, the reputation of the company and its external image are affected by the problems in PR management. Additionally, as one of the primary objectives of PR management is to influence public opinion, it can be seen through the articles that this particular division did not make effective attempts to gain public support.

Analysis

The development of the issue comes from the communication sector, where it covers the process of informing external groups of the public about the company and its activity by the means of various communication media. In this case, the various communication media are the press releases and official statements regarding technical faults. The direction of the coverage was negative as the issue regarding public commitment affected the reputation of “Optus” due to the failure to deliver a proper press release regarding the incidents.

If outlining the major stakeholders in this issue, there could be a distinction in the way they are affected by the problem. Financially, the parties involved are those who experienced losses from the outage such as the customers who use their mobiles for communication and business companies who relied on constant connectivity to process their business operations. The list of business companies includes:

• Service Providers.
• Airport
• Banks and hospitals.

Other stakeholders that are affected by the outage could include the company “Optus” itself and the public including the Queensland government.

Analyzing the stakeholders based on the importance and the influence, it will be as follows:

Influence

High Business partners and large business clients

Low Shareholders and sponsors of the company

Low Others, including the management team involved

High Customers and media

Impact

The key publics in the problem presented are the customers of the population that are targeted as the potential customers of “Optus” which includes ISP providers, Banks, and other private and government institutions that rely on network communications in their working process.

Relations with mass media inherently are two-directional. They form a link between the organization and the press, radio, or TV. On the one hand, the organization gives the information and at the desire of mass media material resources, on the other hand, it also takes steps for releasing comments and reports of information. The mutual trust and respect between the organization and mass media are necessary to pledge of good relations.

On the one side of this chain is the company itself and on the other is the public opinion, and if defining this relation as mutually beneficial the outputs could be evaluated as the establishment of bilateral dialogue for revealing of the general representations or the general interests and the achievement of the mutual understanding based on the truth, knowledge and full knowledge. It could be assumed that the outcome which is the knowledge and full knowledge are affected, thus the relation has been affected in a negative way that accordingly influenced the company’s reputation.

The key events that were taken during the time frame could be characterized as follows:

• Releasing the statement along with an apology regarding the technical outage that was preceded by a statement that it is not their fault.
• Releasing of a statement regarding the compensation to their customer, outlining that it will be on a case-by-case basis.
• Releasing the statement that disproves “Optus” previous statement providing evidence that the technical flaw is not their fault, which is the second time the statements are opposing each other.
• The statements that consist of photos as proof are opposed to other photos that prove that it is the fault of the company after all.
• Two more disruptions in the service of “Optus” telecommunication, no explanation, and more inconvenience for customers.
• Another outage, and a claim that the network was restored, thus no compensation planned by “Optus”
• Statement on the need of an expert from “Optus” equipment supplier.
• A statement about backing up the network with a promise of having emergency maintenance, so the network will not suffer more disruptions.

It can be seen that the rash opposing statements and the lack of a detailed thorough explanation demonstrate the lack of cooperation within the organization of the company as “success is a product of the collective effort of personnel. Where they are committed to organizational objectives, most will be achieved. In the absence of commitment, results are less salutary. Commitment requires personnel to be involved in strategic planning and budgeting as well as program development”. (Brody, 1987, p. 214)

These opposed statements are working negatively on the image of the company, which in the long term could create a particular stereotype of the company’s reputation. Stereotypes are more concrete than the demand. This is certain, visible, heard, and represented biased relation of the public to, the channels of information that are advanced by the company. Stereotypes concern the world of thoughts, feelings, i.e. to the sphere of the ideology. However, their influence on reality and the actions of the public are always enormous, especially because stereotypes happen to be positive and negative. In this case, the issue could form a negative stereotype on the commitment and the trust of the company.

Recommendations

Recommendations on managing the issue presented within the paper according to Jones and Chase system should consist of the following “

1. identification,
2. analysis.
3. developing strategy options for change.
4. action programming, and
5. evaluation.” (Culbertson, Jeffers, Stone & Terrell, 1993, p. 13)

Thus if classifying the aforementioned issue the following categories will characterize it the most.

Category

Definition

• Type

  • Economical, technological
• Impact and response source

  • The business system, Company, Department
• Geography

  • Local
• Span of Control

  • Controllable
• Salience

  • Immediacy

(Culbertson, Jeffers, Stone & Terrell, 1993, p. 13).

The present crisis is usually caused by the fact that it is not directly under the control of the company. Therefore any preparations cannot be specific. However, in more or less predicted crises, there are recommendations on how to avoid them. In many cases preparing a plan of PR-actions addressed for deciding the predicted problem. It is obvious, that many of these problems are caused by internal difficulties, in this case, it is organizational and communication questions. The communication strategy should contain some positions in such cases, including the following.

• Communication with all interested parties (for example, with clients, mass media, distribution partners, business partners, etc.) in time and correct sequence.
• To avoid mess and misunderstanding adapt the key messages for the specific audience.
• Holding the communications process under the control.
• Verification, those communications with all audiences (with clients, mass-media, partners, etc.) it is carried out consistently and according to the development of the situation in time.
• In all contacts with mass media, coordinated key messages are used.

However, the most important action is the installation of clear goals of your actions; in this case, the taken measures logically follow from the goals. Usually, in crises, information measures happen to be to a certain degree qualitative, more than quantitative. It means two aspects:

1. In most cases the company does not want any publications in general.
2. The company wants the facts to be coordinated with their statements.

As the communicating process not only should neutralize the negative effect resulting from the technical problems, it also should advance the public opinion toward a favorable one. “By using communication to reach targeted audiences, organizations in various ways and degrees can change perceptions, ideologies, coalitions, beliefs, attitudes understanding, and policy standards of priorities. Influence is needed to create an atmosphere as hospitable as possible to an organization and its stakeholders, even its critics.” (Grunig & Grunig, 1990, p. 31)

In the organizational aspect, the recommendations involve rearranging the conformity in making the decisions in all the parties involved in the company. According to the exchange theory in the organizational basis “people working through organizations will negotiate decisions about alternative organizational behaviors and objectives. They will collectively shape and direct organizational interactions, both with other organizations and with other constituencies, to maintain equity in power and resource exchanges. Organizational structures will result from the need to maintain balance in exchanges.

Organizational communication will occur or fail to occur when relationships are not in balance. Organizational conflict will occur when inputs and outputs are not in balance and one organization or the other refuses to act to restore that balance. Organizational change will result from continually negotiating inputs and outputs. Organizational management will be both reactive and proactive in such negotiations.” (Botan & Hazleton, 1989, p. 72)

In such a manner the organizational process in the public relations should have reached conformity between the various instances that include PR management team technical staff, marketing team, and company’s head staff after which the released statement should be concentrated on solving the problem and appeasement of the customers. Thus, the main rule in the circumstances is honesty, openness, and efficiency of the organization during a crisis.

Fast publishing to the press of the materials prepared by the company might temporarily stop the negative publicity effect, but a reckless decision could turn the situation against the company as well. It is necessary instantly to start cooperating with mass media, trying to help them enlightening the events according to the facts and the decisions that do not harm the company’s reputation. “Corporations’ problems cannot be solved by communication if they do not result from misunderstanding or misperception.” (Grunig & Grunig, 1990, p. 35)

It is seen that in the organizational issue of “Optus”, the process indicators which are the press releases and the statements are not linked with the outcome indicators, which are in this case maintain the reputation of the company without losing key customers, and keeping the trust of the customers in the company. “Outcomes also measure whether the communication materials and messages which were disseminated have resulted in any opinion, attitude, and/or behavior changes on the part of those targeted audiences to whom the messages were directed” (Grunig, 2000, p. 27)

In this case, if analyzing this problem as a special case in issue management some anticipatory comments could be made in connection with approaching or ongoing problems. A typical example – public discussion of technical maintenance in all branches and the progress reached in eliminating the defects. The company should be assured that the position and the opinions are heard in this discussion. Such discipline in PR can be considered almost as lobbying.

However, it should not be considered as an attempt to affect those who make the decision, rather as a desire to bring the public up to date. Therefore criteria of measurements should include such concepts, as the distinction of the company’s point of view in comparison with other opinions. It can be expressed in a number of publications, in communication influences or, as a result of independent sociological polls.

Works Cited

Botan, C. H. & Hazleton, V. (Eds.). (1989). Public Relations Theory. Hillsdale, NJ: Lawrence Erlbaum Associates.

Brody, E. W. (1987). The Business of Public Relations. New York: Praeger Publishers.

Culbertson, H. M., Jeffers, D. W., Stone, D. B., & Terrell, M. (1993). Social, Political, and Economic Contexts in Public Relations: Theory and Cases. Hillsdale, NJ: Lawrence Erlbaum Associates.

Grunig, J. E. (2000). 2 From Organizational Effectiveness to Relationship Indicators: Antecedents of Relationships, Public Relations Strategies, and Relationship Outcomes. In Public Relations as Relationship Management: A Relational Approach to the Study and Practice of Public Relations, Bruning, S. D. & Ledingham, J. A. (Eds.) (pp. 23-48). Mahwah, NJ: Lawrence Erlbaum Associates.

Grunig, L. A. & Grunig, J. E. (Eds.). (1990). Public Relations Research Annual (Vol. 2). Hillsdale, NJ: Lawrence Erlbaum Associates.

Babou, S. (2008) What is Stakeholder Analysis. The project management Hut. Web.