Executive Briefings

There are Good Ways and (Very) Bad Ways to Manage Crises - Like Horse Meat in Food You Serve

Many balk at the idea of biting into Seabiscuit. The cultural taboo around eating horse is one reason why the public has had such a negative reaction to the news that certain European suppliers have been shipping beef contaminated with horse meat.

On Monday, news broke that said beef made it into IKEA's Kottbullar Swedish meatballs served in some European facilities. Meat in the U.S., the company insists, comes from U.S. suppliers. So far, no contaminated meat in the ongoing European scandal has reached the U.S.

To put the scandal in context, this will probably not significantly dent IKEA's business. Financially, its meatball sales are just gravy -- the company can more than float the business on the profits from its build-it-yourself furniture.

But it could turn into a consumer trust problem. Mostly, says Gene Grabowski, senior vice president and chair of crisis litigation of the strategic communications firm Levick, IKEA has handled this well. It is addressing the issue and promising solutions. That is not true for some of the manufacturers.

"The European manufacturers are making the classic mistake of trying to appear as victims," Grabowski says, which is bad crisis management. There are three players in crises like these, he says: the victim, the villain, and the vindicator. "People don't identify companies as victims because of their size and resources."

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Keywords: supply chain risk management, supply chain, supply chain management, business risk public relations, horse meat, food safety

On Monday, news broke that said beef made it into IKEA's Kottbullar Swedish meatballs served in some European facilities. Meat in the U.S., the company insists, comes from U.S. suppliers. So far, no contaminated meat in the ongoing European scandal has reached the U.S.

To put the scandal in context, this will probably not significantly dent IKEA's business. Financially, its meatball sales are just gravy -- the company can more than float the business on the profits from its build-it-yourself furniture.

But it could turn into a consumer trust problem. Mostly, says Gene Grabowski, senior vice president and chair of crisis litigation of the strategic communications firm Levick, IKEA has handled this well. It is addressing the issue and promising solutions. That is not true for some of the manufacturers.

"The European manufacturers are making the classic mistake of trying to appear as victims," Grabowski says, which is bad crisis management. There are three players in crises like these, he says: the victim, the villain, and the vindicator. "People don't identify companies as victims because of their size and resources."

Read Full Article


Keywords: supply chain risk management, supply chain, supply chain management, business risk public relations, horse meat, food safety