Karen’s PR & Social Media Blog

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November 27, 2012

Walmart & the Bangladesh Factory Fire Tragedy: A crisis case study

One of the crisis situations that will be discussed tomorrow night on “The Crisis Show” will be the Bangladesh Factory crisis that happened a few days ago. On Saturday, November 24th, a fire broke out at a factory in Bangladesh that ultimately killed 112 workers, which has initiated a day or mourning for the victims as well as thousands participating in demonstrations around the area.  These demonstrations focused on raising awareness and calling for action for better worker conditions and justice for those impacted by this tragedy.

One of the companies named in connection with the factory is Walmart, who did release a statement today saying that the Bangladesh factory was indeed making items in their factory before the fire broke out. However, the focus of the statement from Walmart was their acknowledgement that they did use the factory to produce products for them, but they discontinued this relationship due to these concerns.

Walmart made the following statement regarding this tragedy, which was reported in the Huffington Post:

“Today, we have terminated the relationship with that supplier. The fact that this occurred is extremely troubling to us, and we will continue to work across the apparel industry to improve fire safety education and training in Bangladesh.”

What is challenging here for Walmart is that they have been hit with several crises all at once. Just a day before this tragedy hit the factory, there were about 100 cities participating in strikes among Walmart employees set for Black Friday, one of the biggest shopping days of the year in the US.  With the strikes going on as well as the connection with this international tragedy, these crises will impact their overall corporate reputation.

One of the more popular photos being circulated and published regarding the crisis in Bangladesh.

The current situation in which Walmart finds itself reminds me of what happened to Toyota a few years ago with their recall.  They did take responsibility for their actions, however, they also did shift the blame to their supplier of the particular brake part that was causing all of the accidents and issues with the recall.  This appears to be what is going on with Walmart.

However, it was noted that they did reference in their latest Global Responsibility Report (and mentioned in the Huffington Post article) that they stopped working with factories in India due to fire safety issues, so they have these concerns documented already from a year ago.  It is also interesting to see how the media is framing this crisis and its connection to Walmart – even having one article stating how Walmart “failed to protect” factory workers involved in this tragedy, citing that the owners and company wanted to have the cheapest operating costs possible, which means working in unsafe conditions.

t is also apparent that many voices are coming out to tell their perspectives and stories related to this crisis, and what crisis communication professionals need to be aware of in this crisis are a couple of things.

  • First, the power of storytelling and human interest stories will dominate the focus and discussion related to this crisis. The emotional impact and devastation to Bangladesh will be in the spotlight as well as the actions and timeline of events of the crisis.
  • Second, Walmart’s responses and statements have to be timely and accurate – they have to provide documentation of their actions and initiatives related to this crisis as well as what they did before this crisis happened in terms of raising their concerns about the fire safety issues.
  • Third, photos and other visuals are being used as a strategic communication tool to show the global community the impact and devastation for this crisis, which crisis communicators have to determine the best message strategies and platforms to use to handle these new tools in raising awareness and advocacy for those impacted in this crisis.
  • Lastly, there needs to be messages involving Walmart and others involved on what they are going to do next to make sure that this does not happen again. Also, resilience needs to be incorporated into these messages to help those involved overcome this tragedy and bounce back into their daily lives.  This may take time, resources, and dedication – but this needs to happen to help restore trust and credibility.

In summary, this case is a cautionary tale for brands and individuals to make sure they investigate and really evaluate whether or not to do business with others and formulate long term partnerships.  Associations, even of you are not directly involved in a crisis, can get you into trouble as well.

Hope you all are having a great day.

Best Wishes,

Karen

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