Debate: Substantive But Boring

Analysts are complimenting the policy-related questions for the fourth Republican Presidential debate, but the result was a less exciting debate. Representatives from Fox Business Network did a better job than CNBC reporters in the last debate by focusing on real issues instead of personality.

Donald Trump played a less dominant role in this debate. Fox News reported, "As for Trump, he was very passive tonight. Statesman Trump is not as fun as reality TV Trump." CNN reported other players winning ground:

"There was no single dominant performance as in the past when candidates such as Carly Fiorina and Marco Rubio wowed audiences -- and swiftly improved their place in the polls. Several candidates, including Rubio and Ted Cruz, were strong on the debate stage on Tuesday. And Jeb Bush, who has struggled in such environments, projected greater confidence, seeming to relish a confrontation with Donald Trump on national security."

Reuters' focus was also on Jeb Bush, who said of his own performance, "I thought the debate went well, and I had a good debate because I got to talk about things with a little substance instead of the cute one-liners." Bush may have bought himself more time to gain a few percentage points in the polls; his campaign has been suffering, and his debate performances until this one certainly haven't helped.

Rubio and Cruz are emerging as the most well spoken, if not the most brilliant or substantive.

Discussion Starters:

• How much do you think appearance and youth count in the election? How will these factors help Rubio and Cruz?
• Who do you think won the fourth debate? How, if at all, will this debate affect your vote?

SeaWorld Changes Its Whale Show

It took since the opening of the movie "Blackfish" in July 2013: after increasing protests and declining park attendance, SeaWorld has finally announced the end of its killer whale show-in some form.

The documentary and other critics accused the theme park of keeping and mistreating orcas in captivity. Although the news reports that shows are ending, they will reopen with a different type of show in 2017. CEO Joel Manby describes a "natural setting, natural environment, and also the natural behaviors of the whale."

This report from the Today Show features Samantha Berg, a former SeaWorld trainer who appeared in "Blackfish." (Sam is also a Cornell graduate and was a guest speaker for my Corporate Communication class last year.)

Critics say the new show plan is a "bait and switch" and perpetuates captivity of the whales.

As the news was hitting media reports, SeaWorld published two major communications-neither mentions the decision to end shows as we know them:

• A video, "This is How SeaWorld is Taking Action to Make a Better World for Animals," describing the organization's rescue efforts and the emotional appeal of its parks
• A post on its website

Discussion Starters:

• What's your view of SeaWorld's PR strategy? Should the organization mention the show changes in its communications, or is it a smart decision to avoid the topic entirely?
• Many news reports focus on ending on the shows, but that's not quite the story we hear from the Today Show clip. Are the news reports short-term, deceiving, or something else?

More Trouble for Volkswagen

Volkswagen is facing a new wave of inquiry since the diesel emissions scandal. According to The Economist, "VW confessed that it overstated claims about the carbon-dioxide (CO₂) emissions and, thus, fuel efficiency of 800,000 cars, including, it seems, some with petrol engines."

The European Commission is asking EU countries to expand their investigation. A spokesperson for the Commission said, "Public trust is at stake. We need all the facts on the table and rigorous enforcement of existing legislation." Since the news about the cheating software, VW's stock lost more than one-third of its value. 

Now that Porsche models have also been implicated, VW's new CEO, Matthias Müller, previously head of the Porsche division, is not looking as good. As The Economist writes, the news "casts a shadow" on his role. 

Communications continue to lag. The U.S. VW site has the same tired video of Michael Horn. 

Discussion Starters:

• Did VW do the right thing by admitting the emissions under-reporting? Another strategy would have been to wait for the news to be discovered as part of the diesel software investigation. 
• What else should VW communicate at this point? Look at the U.S. website and make a few recommendations. 

Metrojet Defends Its Plane and Pilot

A Russian airplane crashed in Egypt, killing 224 people, and the cause still eludes investigators. The airline, Metrojet, has ruled out mechanical failures and pilot error, anxious to rebuild its reputation.

But the head of Russia's Federal Air Transport Agency said, "...it is very premature to talk about the reasons. I would like to call on the aviation community to abstain from premature statements." Russian President Vladi­mir Putin said, "Everything must be done to create an objective picture of what happened so that we know what happened and react accordingly."

Metrojet is still at the center of the investigation. Turns out, the company hasn't paid its employees in two months, and a pilot's wife says her husband complained about poor plane maintenance. Also, the Metrojet plane had suffered a tail strike, and investigators are wondering whether the problem was properly fixed. In a video statement, Metrojet denied mechanical and pilot errors.

Recent reports indicate a flash picked up by a U.S. satellite, which could point to an explosion on board, such as a fuel tank or a bomb.

Meanwhile, ISIS has taken responsibility for the crash. Although officials won't yet rule out terrorism, few seem to believe the organization's claims.

Putin expressed his condolences and investigation plans via video.

Discussion Starters:

• How well is Metrojet handling the news and its defense?
• How does the background information about Metrojet-potentially missing payroll, for example-influence your thinking about the situation?

Messages About Pig Farming

A full-page ad in today's Wall Street Journal tells us why pig farmers use antibiotics. The "We Care" initiative of two pork associations strives to "promote responsible practices in all areas of farming and is a commitment to continuously evaluate and improve our methods." 

The Porkcares.org website highlights healthy practices for pig farming, particularly defending the use of antibiotics. 

The controversy was elevated recently when Subway announced it would serve pork without antibiotics. This organization differs:

"When Subway recently announced-that soon all meat served in its restaurants would be sourced from farms that use no antibiotics at any time-some folks cheered. But, the thing is, all meat sold in the U.S. is inspected by USDA's Food Safety and Inspection Service for consumer safety and must meet the same high standards regardless of production methods. Furthermore, it's not practical to never use antibiotics on a farm." 

On its website, the organization highlights "5 Ways Subway Got It Wrong" and why antibiotics are important for food safety, animal health, humane treatment, sustainability, and consumer pricing. 

Subway's announcement included this graphic: 

The opening paragraph of the press release follows: 

"SUBWAY® Restaurants announced today that it has elevated its current antibiotic-free policy. The brand recently communicated a commitment to transition to only serving chicken raised without antibiotics important to human medicine. Today, the brand confirmed that it is beginning to transition to serving only protein from animals that have never received antibiotics across all of its 27,000+ U.S. restaurants in early 2016."

Discussion Starters: 

• Analyze the organization's argument on its website. Which arguments are most and least convincing? How effective do you find the graphics, fonts, and other visual elements?
• Analyze Subway's infographic. Consider the text, graphics, color, and so on.
• After reading the related messages, what's your view about using antibiotics? 

Amazon Responds to NYT Piece

Two months after The New York Times published a scathing article about Amazon's work environment, the company is responding. Right after the article, Jeff Bezos did send an email to employees, and others wrote their own perspective. But this is an official and attacking review of the article by Jay Carney, former White House press secretary, and now VP of worldwide corporate affairs at Amazon.

Reminiscent of criticism of Rolling Stone's article on rape at the University of Virginia, this piece challenges New York Times reporters' fact checking. Will The New York Times also retract its article?

Carney begins his rebuttal with the quote featured in the Times article: "Nearly every person I worked with, I saw cry at their desk." He writes,

"Olson's words were so key to the narrative the Times wished to construct that they splashed them in large type just below the headline.

"Here's what the story didn't tell you about Mr. Olson: his brief tenure at Amazon ended after an investigation revealed he had attempted to defraud vendors and conceal it by falsifying business records. When confronted with the evidence, he admitted it and resigned immediately."

It will be interesting to see how The New York Times responds to these claims.

UPDATES:

• Dean Baquet, executive editor of The New York Times responded, justifying the article. He said that more than 100 employees were interviewed, and themes emerged clearly (which, he says, have been supported by thousands of comments on the Times' website). Baquet also cites several employees and clarifies their perspective more fully.
• Carney again responded, questioning the Times' fact-checking.

Image source.

Discussion Starters:

• Why did Amazon publish this article two months after The Times piece?
• How do you think The Times will respond? What could the reporter say to substantiate the article?
• UPDATE: Do Banquet's response and/or Carney's response change your opinion of the story or Amazon?

United Announces Acting CEO

United Airlines has selected a new chief while the previously selected CEO is in the hospital. United CEO Jeff Smisek resigned amidst allegations of improprieties including keeping unprofitable flights to suit an executive at the NY/NJ Port Authority. Oscar Munoz, previously COO at CSX, was hired to replace Smisek, and had a strong start, communicating with United customers and employees. 

But Munoz suffered a heart attack just 41 after his appointment and has taken a medical leave. In the interim, the company announced Brett Hart, United's general counsel, as acting CEO. Hart joined United in 2010 from Sara Lee. 

In the press release posted on United's website, the company quoted Hart:

"Oscar's agenda is focused on customer service, teamwork and innovation and I, along with the executive team, will continue to move quickly to implement it. We believe strongly that we can continue to make steady progress on increasing shareholder value by working together to deliver a great product to our customers."

Although this sounds optimistic for Munoz's return, the press release ended this way: 

"The board of directors remains actively engaged in preparing for all potential outcomes regarding the company's leadership structure."

Strangely, a CNN Money article includes this reference to Hart's history at Sara Lee: 

"Hart was at Sara Lee when its CEO, Brenda Barnes, suffered a stroke and resigned in July 2010. Hart announced he was leaving for a position at United three months later."

Image source. 

Discussion Starters: 

• What are United's considerations in addressing Munoz's leave and announcing an acting CEO?
• Assess United's statement about the leadership change. Read between the lines: what do you take away from the announcement? 
• Why would CNN Money include Hart's history at Sara Lee?  

Pope Apologizes for...What?

Pope Francis has issued an apology, but critics want to know what it's for. He asks for forgiveness for "the scandals that have occurred recently both in Rome and at the Vatican."

A Reuters article says the apology is "an apparent reference to two cases of priests and gay sex revealed this month during a major meeting of bishops." The article also indicates, "The pope also appeared to be referring to a scandal exposed in the Italian media last week about an order of priests who run a parish in a well-to-do neighborhood in Rome." 

But for some, the apology isn't clear enough. The outreach director for the organization Survivors Network of those Abused by Priests (SNAP) expressed her frustration:

"Instead of stopping clergy sex scandals, Pope Francis is again asking forgiveness for them. That may be good public relations but it's irresponsible leadership."

This isn't the first broad apology. In 2000, John Paul II made what The Guardian called "a sweeping apology for 2,000 years of violence, persecution and blunders." 

Discussion Starters:

• What's your view of the pope's apology? Is it enough? 
• If the pope were to be more specific, what could he say?

Coastal Commission Bans Whale Breeding

In what could result in the final demise of SeaWorld, the California Coastal Commission announced a ban on breeding whales. Because SeaWorld no longer captures whales from the wild (and hasn't in 35 years, according to the theme park), its source of entertaining orcas must come from breeding within the current supply.

In a press release, SeaWorld says it will "review options." President and CEO Joel Manby said, "Depriving these social animals of the natural and fundamental right to reproduce is inhumane and we do not support this condition."

The Editorial Board of the San Diego Union-Tribune scored a win for SeaWorld by questioning the legality of the Coastal Commission's ban. The article ended with this encouragement: "But SeaWorld has options, the most obvious being a court challenge. We urge it to aggressively pursue that option."

Others support the decision, including the Humane Society and PETA, which has advertised against SeaWorld's orca conditions by comparing their living conditions to a bathtub.

Discussion Starters:

• Assess the persuasive arguments in the Editorial Board's article. Which do you find most and least convincing?
• What actions should SeaWorld take now? Consider legal options and messaging.

Horn Testifies Before House Committee

Michael Horn, President and CEO of Volkswagen Group of America, Inc., addressed the U.S. House Committee on Energy and Commerce Subcommittee on Oversight and Investigations about the company's emissions scandal.

His opening statement to the committee included his own defense. He said he was not aware of the software issue, but he did assure the committee that the company takes full responsibility.

Subcommittee members, such as Diana DeGette of Colorado, pushed Horn for more details about the deception:

"You haven't revealed how the defeat device affects the engine, why it was installed and how it was able to evade emissions tests. You haven't revealed when and how the engines equipped with this defeat device will be fixed. And you haven't told us whether that fix will affect the fuel economy or performance of the vehicles."

Other members questioned whether this was VW's only "dirty little secret" and expressed concern about widespread deception in the auto industry.

Discussion Starters:

• How convincing do you find Horn's opening statement?
• I wish he had coaching to pronounce "vehicle" more clearly. Do you have trouble understanding other words?
• Watch the full hearing. How well does Horn respond to questions? Which do you find particularly persuasive, and where does he fall short?

Planned Parenthood Fights Allegations

A video showing Planned Parenthood officials discussing how they provide fetal tissue for research has caused outrage and a fight from the organization. Abortion opponents use the video as evidence of Planned Parenthood's "selling baby parts," but the organization denies these claims. 

In a statement on its website, Planned Parenthood refers to opponents as "extremists" and calls the videos "highly political" with "at least 42 splices": 

"They are engaged in a fraud, and the claims they've made have been discredited and disproven. If there was any truth to these videos, the footage would be shared with a judge who would take the necessary steps to seize records and conduct an investigation.  Instead, the videos were shared with members of Congress in advance of being released to the public and then used in an effort to defund Planned Parenthood and eliminate access to women's health care."

The Planned Parenthood website has additional statements, and Cecile Richards appeared before Congress to testify. 

Discussion Starters: 

• Analyze the organization's statements on its website. What themes emerge? How would you describe the tone? 
• In what ways do your own views of abortion affect how you read the organization's statements?

GM CEO: "People Died in Our Cars"

In a statement to employees, GM CEO Mary Barra was frank: "People were hurt, and people died in our cars." Her presentation came after the company reached a $900 million settlement agreement with the Department of Justice for failing to recall cars with faulty ignition switches. (See transcript.)

Barra focused on changes at GM: 

"But apologies and accountability don't amount to much if you don't change your behavior.  We have.  And that's what I want to focus on in our time together."

She outlined what she called a "tough agreement" and then reviewed the actions GM has already taken: "We lived our values, and it made a huge difference."

Discussion Starters:

• Who are the primary and secondary audiences for Barra's presentation? Why would the company make this internal communication public?
• Assess Barra's video. What is notable about the content, organization, and delivery compared to her previous presentation to employees?

VW Executive Changes and More Comms

Since the scandal broke, Volkswagen has sprung in action, making executive changes and stepping up communications. No surprise, Martin Winterkorn resigned. However, his statement is unusual (as was his video, considering the likelihood that he would leave the company): 

"I am shocked by the events of the past few days. Above all, I am stunned that misconduct on such a scale was possible in the Volkswagen Group. 

"As CEO I accept responsibility for the irregularities that have been found in diesel engines and have therefore requested the Supervisory Board to agree on terminating my function as CEO of the Volkswagen Group. I am doing this in the interests of the company even though I am not aware of any wrong doing on my part. 

"Volkswagen needs a fresh start – also in terms of personnel. I am clearing the way for this fresh start with my resignation. 

"I have always been driven by my desire to serve this company, especially our customers and employees. Volkswagen has been, is and will always be my life. 

"The process of clarification and transparency must continue. This is the only way to win back trust. I am convinced that the Volkswagen Group and its team will overcome this grave crisis." 

Since the decision on Wednesday, VW has hired a new chief executive, Matthias Müller, previously head of Porsche. A New York Times article title calls him an "insider"-notable because of criticism about the company's centralized control of power.  

Additional communications include the following: 

• Statement by the executive board
• Statement by the CEO of VW car brands
• Statement about further restructuring

Discussion Starters: 

• Analyze the most recent communications. Are you convinced the company is doing all it can to fix the situation and regain customer confidence?
• As far as I know, U.S. VW customers have not received any direct communication (e.g., an email) from the company. What's your view about this? 

Volkswagen Upsets Customers

Volkswagen customers are furious, and the executives have a lot of explaining to do. Chief Executive Martin Winterkorn may be known for his meticulousness, but he missed the boat in ensuring that the company met ethical industry standards. An investigation has revealed that millions of diesel cars don't meet emissions guidelines; worse yet, software to intentionally deceive tests was built into many models.

A New York Times article covers background (drama) between Winterkorn and former Chairman Ferdinand Piëch. Now, Winterkorn seems to be holding the responsibility. Because VW has centralized management practices, he'll have a tough time convincing stakeholders that senior management wasn't involved. 

As you can imagine, VW customers aren't happy about the situation. They bought the "clean diesel" line from the company and "green" award-winning Passats, Golfs, Jettas, Beetles, and Audi A3's that aren't what the company claimed. The fixes are expensive and will cause drops in performance or trunk space. A Wired article also warns that, whether people "dodge the recall or not, your car's resale value is likely to drop as far and fast as VW's stock, which has plunged 20 percent since the feds came down on VW Friday." 

On its website, VW posted two statements relevant to this situation. The first addresses the findings and apologizes (below), and the second-issued two days later-says the company is "working at full speed to clarify irregularities concerning a particular software used in diesel engines." 

In addition to these written statements, Winterkorn created an apology video: 

UPDATE: Today's post, as predicted, included Winterkorn's resignation:

Discussion Starters:

• Analyze the two company statements. In what ways do they rebuild company image, and how do they fall short? 
• What else does the company need to do to gain consumer confidence? What should Winterkorn do? 
• The news was announced on Sept. 20. How many days do you predict it will take him to step down?

United CEO's Email to Customers

United's new CEO Oscar Munoz has reached out to United Mileage Plus members to introduce himself and try to improve the airline's image. Three executives, including the former CEO, left the company because of potential improprieties.

After communicating with employees, Munoz has sent a similar message to customers.

 

In an article, "How A Scandal Has Given New Life To United Airlines," the author discusses the airlines' stock gain for the past couple of days. Perhaps the CEO's clear, personal communications are contributing to the recent attention.

Discussion Starters:

• Compare the messages to employees and customers. What differences and similarities do you notice?
• In his message to customers, Munoz did not mention that executives recently left the company. What factors do you think he considered in making this decision?

Comedian Apologizes for 9/11 Account

For 14 years, Steve Rannazzisi stuck to his story of escaping the Twin Towers during the 9/11 attacks. In 2009, he gave a detailed account of the day and how the event inspired him to move to Los Angeles. Now a comedian with his own TV show, a special on Comedy Central, and an endorsement deal with Buffalo Wild Wings, Rannazzisi's lie is biting him back.

Rannazzisi posted a series of tweets, but his confession doesn't seem to be winning him any favors. He also published a statement, which The New York Times called "contrite":

"It was profoundly disrespectful to those who perished and those who lost loved ones. The stupidity and guilt I have felt for many years has not abated. It was an early taste of having a public persona, and I made a terrible mistake. All I can ask is for forgiveness."

Buffalo Wild Wings is reconsidering their deal:  

"We are disappointed to learn of Steve's misrepresentations regarding the events of September 11, 2001. We are currently re-evaluating our relationship with Steve pending a review of all the facts."

Discussion Starters: 

• What's your assessment of Rannazzisi's tweets and statement?
• Should Buffalo Wild Wings cancel his contract? Should Comedy Central cancel his show? If so, what should they say?

European Commission Official Calls for Unity

Jean-Claude Juncker, president of the European Commission, called for quotas for European countries to accept more than 160,000 refugees. Juncker is encouraging consistent immigration policies and warning sanctions for countries that don't take their fair share. 

Juncker used emotional appeals in his state-of-the-union address to the European parliament: 

"Today it is Europe that is sought as a place of refuge and exile. It is Europe today that represents a beacon of hope, a haven of stability in the eyes of women and men in the Middle East and in Africa. That is something to be proud of and not something to fear."

When speaking of the potentially 500,000 refugees who may cross borders, Juncker gave more examples: 

"Europe is the baker in Kos who gives away his bread to hungry and weary souls. Europe is the students in Munich and in Passau who bring clothes for the new arrivals at the train station. Europe is the policeman in Austria who welcomes exhausted refugees upon crossing the border. This is the Europe I want to live in."

Although Germany, France, and Italy support the plan, other EU members are reluctant. Juncker used Ukraine as an example of a country that may seek assistance in the future. But he did not convince everyone. Slovak prime minister said, "We won't bow down to Germany and France. Quotas are irrational." The plan also faces resistance from Poland and the Czech Republic, whose Europe prime minister called quotes "nonsensical." 

The UK has been a notable resistor to accepting migrants. Britain's Liberal Democrat Member of the European Parliament chastised the prime minister's lack of cooperation: 

"By refusing to take a single refugee that has arrived on Europe's shores, the UK government is shirking our international duty and lowering Britain's standing in the world. Of course we must do more to tackle the causes of the refugee crisis at source, but we cannot turn a blind eye to the human tragedy unfolding right now on our continent."

Prime Minister Cameron has defended his financial contributions and focus on resettlement. 

Discussion Starters:

• What are Juncker's challenges in delivering this speech? What type of resistance does he need to overcome?
• Read the transcript of Juncker's speech. What examples do you see of emotional appeals, credibility, and logical argument? What rhetorical devices does he use?
• Assess Juncker's delivery skills. What suggestions do you have for his future presentations?

Pilot Strikes

Two pilot associations are in the news for strikes this week: Vereinigung Cockpit (a German pilots' union for Lufthansa and Germanwings) and the Independent Pilots Association (for UPS).

The Lufthansa pilots have extended their strike-their 13th in the past 18 months-to a second day, causing more than 1,000 flight cancellations. In a press release, the company stated its willingness to negotiate with the union:

"Lufthansa remains willing to resume its negotiations on all open collective labor agreement items with the VC's Group Collective Labor Agreement Committee at any time. 'Our goal is still to work with the VC to find a joint solution to all the open CLA issues through the negotiating process,' confirms Dr. Bettina Volkens, Chief Officer Corporate Human Resources of Deutsche Lufthansa AG."

The UPS pilots took out a full-page ad in The Wall Street Journal to express their dissatisfaction with union negotiations. The ad claims, "UPS management has stalled and delayed, unnecessarily prolonging our contract negotiations."

In a statement, UPS management clarifies that, although the union is threatening to strike, it won't happen. The first three paragraphs of the statement follow:

"UPS continues to negotiate in good faith for a contract that is good for our employees, our customers and our company, and we are confident these negotiations will be completed without disruption in our service.

"Despite the IPA's announcement, there is no real threat of a strike. Such authorization votes are routine during negotiations in the airline industry, but they are legally irrelevant under the Railway Labor Act, the U.S. labor law that governs airlines.

"Under the RLA, a strike is not possible unless authorized by the National Mediation Board. Even then, there are a series of fail-safes, including presidential and congressional intervention, designed to prevent an interruption in operations. . . ."

Discussion Starters:

• What's your view of the IPA's full-page ad in The Wall Street Journal? This is an expensive communication. Is it effective? Who is the audience, and what are the objectives?

• Assess UPS's full statement. Which are the most and least convincing arguments?

Arguments About Raising the Minimum Wage

Perspectives on the whether and how much to raise the U.S. minimum wage are heating up. A recent National Labor Relations Board ruling made it easier for fast-food workers to negotiate with companies, even if they are contractors or work for a franchisee. And the minimum wage in New York State will increase to $9.00 in December 2015 and likely to $15 for fast food workers. 

The upcoming presidential election also has heightened interest in the topic. A New York Times Editorial Board op-ed describes some of the Republican candidates' arguments: "none of which make much sense." Popular opinions include the following, according to the article: 

• States should decide (Fiorina)
• The market should decide (Bush)
• Businesses will be hurt (Trump)
• Robots will replace workers (Rubio)

The National Restaurant Association has been an active voice in the debate. In an article, the organization points to potential negative impacts on young workers and the industry. 

Image source. 

Discussion Starters: 

• Which arguments do you find most and least compelling? What evidence supports your own point of view? 
• Have you worked for minimum wage? How, if at all, does that affect your position in the debate? 

Ashley Madison's CEO Resigns

Now that the jokes about increasing divorces have subsided, Ashley Madison is in the news again because company CEO Noel Biderman will step down. Ashley Madison is the online dating site that fell victim to a computer hack along with 37 million users who were exposed for cheating on their partners and spouses. The site's tag line is "Life is short. Have an affair."

Although the company promised anonymity, it couldn't protect users from having their emails revealed in an easily searchable database. Further damaging the company's credibility, thousands of Ashley Madison emails in the system showed that many of the female profiles on the site weren't real. 

In a statement, the company says decision for the CEO to leave is by "mutual agreement." 

Discussion Starters: 

• Analyze the statement about the CEO leaving the company. Consider the timing, content, and tone. What could be improved? 
• Although Noel Biderman denied having affairs, the hack revealed communications between him and women. Do you think this factored into the decision for him to resign?  
• Read additional company statements. How is Ashley Madison trying to rebuild its image?Which tactics do you find most effective?