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CORPORATE CRISIS: ANTHRAX AND THE U.S. POSTAL SERVICE

CORPORATE CRISIS: ANTHRAX AND THE U.S. POSTAL SERVICE . John Nolan Former Deputy Postmaster General October 18, 2006 john.m.nolan@verizon.net. Anthrax and the USPS. USPS was experienced in dealing with disasters What’s the same? What’s different?. Situation: September, 2001.

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CORPORATE CRISIS: ANTHRAX AND THE U.S. POSTAL SERVICE

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  1. CORPORATE CRISIS:ANTHRAX AND THE U.S. POSTAL SERVICE John Nolan Former Deputy Postmaster General October 18, 2006 john.m.nolan@verizon.net

  2. Anthrax and the USPS USPS was experienced in dealing with disasters • What’s the same? • What’s different?

  3. Situation: September, 2001 • USPS Business Model in Jeopardy (GAO) • Internet/Recession/Competition/Negative Legislation • Volume/Revenue Dropping • 9/11 Impact on Ops/Service

  4. Pre-October, 2001 Scientific Community Determination: • Anthrax will not escape sealed envelope • Little or no risk to employees • No contamination to other mail

  5. Anthrax Attack in the Mail LEAD NEWS STORY FOR ONE (1) MONTH PERIODICALLY FOR TWO (2) MORE MONTHS • Four (4) Letters • Ten (10) postal workers with anthrax and two (2) die • Eight (8) others with anthrax and two (2) die • Canadian scientists’ video changes everything • 284 facilities tested; 23 test positive; 2 closed for almost 3 years • 17,400 employees on antibiotics • Since attacks, 25,000+ incidents requiring facility closures for short periods . . . no anthrax found in any • Advertising Mail volume initially plummets

  6. Key Actions • PR firm utilization • Task Force implementation . . . with unions • Reaching out to industry CEO’s / experts • Testing DC plant (despite assurances) • Media and internal communications strategies • Maintained control of crisis command center • Determination of exact size and scope of exposure • Closure of 2 centers (but not others!) • Meeting with Canadian terrorism experts • No amount of planning will ever replace dumb luck RELIANCE ON OUR CRISIS MANAGEMENT PROCESS!

  7. J&J Plan for worst Early admission Take responsibility Empathy, responsibility, action Message from top Deny blame Create picture Make sacrifices USPS Plan for worst Early notification Reliance on experts Empathy, responsibility, action Message from top Control team; deny blame Create picture Make sacrifices J&J Tylenol / USPS Similarities:

  8. Strategy, Timing, Control of Story Seek to understand and be understood Build trust and bank it Media, public, customers, investors “Could USPS be the first major business casualty of the war on terrorism?”Washington Post “Anthrax assurance as threat to public trust – officials insisted mail was safe but now wonder.”L.A.Times “Amid Anthrax, businesses sour on U.S. Mail and seek alternatives.”WSJ “Polls find Americans not panicking over anthrax” Gallup/USAToday “72% Happy With Government Handling Of Problem”CBS News/NY Times Crisis Communications

  9. Anthrax Aftermath • Employee health • Employee morale • Management-Labor relations • Health of the business • Organizational credibility • Government • Media • Industry • Future crisis readiness • Biohazard detection capability

  10. The Board’s Role: Before, During, After • Ensured sound process and plans in place • Culture of timely and open communication • Corporate Governance rules still applied • Offered experience and support • Let management manage (While assessing performance) • Listened: Were “consumers”/ investors • Evaluated: sought to improve readiness

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