Monday, January 5, 2009

Dealing with the Rumor Shrill

There is such a drumbeat of speculation about the health of Apple’s CEO you’d think someone will soon launch a “Sickly Steve Jobs” blog to organize the rumors in one place.

Let’s see…Steve recently had a heart attack or, according to reports this morning, it’s a hormone imbalance that has led to significant weight loss. Have no fear, blogger extraordinaire Robert Scoble got word from a reliable source that Jobs’ health is just fine.


This would be laughable if it weren’t for the hit Apple’s stock takes nearly every time a rumor about Jobs’ fragile well being spreads from blog to blog to the business press. I suspect there is little chuckling among the institutional and retail investors who see the value of their shares torpedoed by speculation and rumor mongering.

Apple’s failure to publicly address the health of its CEO has me thinking about the responsibility a company has to its shareholders to put an end to such speculation. Like most organizations, Apple’s policy is to simply decline to comment. Unfortunately, their silence creates a vacuum that is quickly filled by the shrill of rumors from the blogosphere.

Yes…Apple does need to more clearly address this situation as it’s damaging their business prospects and the valuation of the company. Here is my take on a possible course of action:

1. Develop a message platform that balances the interests of shareholders with Jobs’ desire for privacy. If he is sick, it should be acknowledged in greater detail than some vague reference to hormones being out of whack. Equally important, the company’s plan to maintain continuity of management regardless of Job’s current well being should be presented.

2. Create a micro-site for the distribution of information directly from Apple. Rather than “no comment,” refer journalists, bloggers, shareholders, etc. to this site for accurate information. Even better, incorporate comment functionality into the site so Apple representatives can address questions, when appropriate.

3. Select a handful of respected journalists and bloggers for a sit-down with Jobs and other members of the management team. Give them full access, yet set ground rules about topics and issues that Jobs will address.

4. Monitor the media and blogosphere for inaccuracies, and move rapidly to correct any misinformation.

8 comments:

Robin Ferrier said...

Marc: If anything, this whole situation should show companies the importance of not only having a succession plan, but also having a public communications plan that ensures the successor is publicly prominent prior to a succession plan being implemented. Apple should be concerned that people seem to think the company's success lies so totally with Steve Jobs. They need to ensure their second in command is out and present so people don't fear this sort of thing happening. (Does the 2nd in command at Apple have a public presence? If so, I don't know about it, but then, I don't follow Apple closely...)

Eric Forst said...

Marc, I think your suggestions are spot on. Corporate reputation and brand are increasingly owned by consumers and the comments they post online. It is critical to monitor the buzz and respond to rumors and misconceptions in real time. Apple also lost stock price on false iPhone delay rumors in 2007. Blog monitoring software (i.e. www.visibletechnologies.com) can help you pinpoint the most influential authors and keep pace with the dynamics of online communities.

Lydia Sugarman said...

Don't you mean "rumor mill"? From Wikipedia- Noun
rumor mill (plural rumor mills)
(idiomatic) A group or network of persons who originate or promulgate gossip and other unsubstantiated claims.

Marc Hausman said...

@Lydia - nope...I actually do mean "shrill." It is a play on mill, yet shrill is much more of high-pitched, annoying sound.

Mark Schannon said...

Marc,

You're absolutely right that the "no comment" approach is an invitation for the rumor mill to race into hyper drive. There are no firm PR rules for dealing with these kinds of issues for lots of reasons, but to quote David Maister, a management consultant I've seen a number of times, "all ambiguous behavior is perceived negatively."

I can fully understand Jobs's desire for privacy, but, as you note in your article, he needs to balance that against his responsibility to his company and the share owners.

I think your recommendations are great. My only caution, and it's one of the toughest calls to make, is determining when rapid response is required. If the source is a crank or has few followers, it might be better to hold off. On the other hand, if one believes that a rumor might get legs, then rapid resonse--from credible sources--is essential.

This is also a situation where humor can be effectively used--the old Mark Twain "Rumors of my death have been greatly exaggerated." Apple spokespeople should be well trained--and not everyone can pull this off--in using humor to deflate the rumors. Depending on the culture at Apple, this could range from the mild to the totally absurd. But it works.

margaret chaidez said...

Given Jobs large following, the blogger/journalist round table is an excellent idea. I think there is a lesson here for all large corporations. There is a fine line between informing on a need to know and creating panic.

I have seen this so many times where corporations overlook some of the basics of PR. Communicate with your employees, communicate with your stakeholders, provide updates on a regular basis.

Really surprised at Apple's poor response to the situation.

Alesa said...

Good post, Marc. A couple of comments:

1) I agree that "no comment" is public relations suicide and is amateurish at best. It only invites conjecture that just makes the issue more prominent.

2) OTOH, as an onlooker or halfway savvy investor, I would have a hard time believing that Apple does not have a deep succession plan. Remember, Jobs was kicked out of his own company when his hand-picked man John Sculley came to turn the company around. Apple has seen Jobs leave before, and his return is part of the cult of Apple.

Both Coke and McDonald's (I believe) survived the sudden death of their CEOs, in the same year, I think. The success of successful public companies does not and should not hinge on the health of one person, be it the founder/CEO or anyone down to the janitor. Just because Jobs may be keeping his health situation close to the vest, that would not dim my view of the company, even though I agree they could be doing much better with this potentially unfortunate situation for him.

Marc Hausman said...

@Alesa - thanks for the comment. Excellent point about the importance of corporate succession planning. It's something that needs to a Board-level priority.

And you're spot on about Coca-Cola. In fact, I believe they had two CEOs unexpectedly pass away within a few years of each other.