Presentation on theme: "1 Announcements: Tuesday Breakoutreview for the final Office hours next week: Tuesday 1:30-3 Wednesday 10-11:30, 3-5 Thursday 2-4 Exam is on Friday 10-12,"— Presentation transcript:
1 Announcements: Tuesday Breakoutreview for the final Office hours next week: Tuesday 1:30-3 Wednesday 10-11:30, 3-5 Thursday 2-4 Exam is on Friday 10-12, various rooms that I will post on Oncourse
2 Announcements: Thursday Office hours next week: Tuesday 1:30-3 Wednesday 10-11:30, 3-5 Thursday 2-4 Exam is on Friday 10-12, various rooms that you were told in section and that I will post on Oncourse
4 Calgene The aim: to genetically modify crops: insert genes to improve a crop in some way. $90 million was spent 1980-92.
5 Calgenes Products The FLAVR SAVR tomato, which would not rot on the vine and so could be naturally ripened Herbicide-resistant cotton Improved canola oil for detergents, shampoo, margarine, and auto lubricants Which of these would have the most political trouble?
6 What you will learn today How should you deal with activists and the press?
7 The Life Cycle of an Issue Development Felt need, Dissatisfaction Politicization Public discussion, Intellectual leadership, Mobilization Triggering event Legislation Implementation Your Ability to Influence Shrinks over Time...
8 Heading off the Issue 1. Crisis Audits: identify a list of potential problems 2. Fix the problem before the pressure starts. 3. Admit responsibility 4. Co-opt the opposition
9 Admit Responsibility Cut your losses Best done early---before pressure--- not late Limit the storys lifetime Maybe even if youre not mainly to blame like out-of-court settlements, or no-questions-asked returns Like the big bath in accounting
10 Co-opting the Opposition Figure out their personal objectives Get their approval by compensating them Substitutes in the interest-group analysis chart The Danegeld problem
11 The Politics of Mass Opinion ConcentratedDispersed Concentrated Interest group politics Entrepreneurial politics DispersedClient politicsMajoritarian politics Policy Benefits Policy Costs Mass opinion is mobilized in entrepreneurial and majoritarian politics.
12 Entrepreneurial Politics Political entrepreneurs are expert at using the media to mobilize interest groups Does your business have that expertise? Sensationalism sells the story!!! Many people forgive someone who lies for the public interest People dont forgive businesses that lie
13 Greenpeace and Shell Should the Brent Spar be dumped deep in the sea? Greenpeaces situation: a drop in contributions Greenpeace estimate: 5,000 tons of oil sludge. Shell: 100 tons.
14 Greenpeaces spokesman: Joe Six-Pack wont understand your technical details. All he knows is that if he dumps his can in a lake, he gets fined. So he cant understand how Shell can do this.
15 Imagine you are a reporter… Reporters must operate with tight deadlines Reporters are not experts. They rely on experts: Government sources: The FDA, the ITCFDAITC Think tanks like the Heritage Foundation and the Brookings InstitutionHeritage Foundation Brookings Institution Academics: Wisconsin and OxfordWisconsinOxford Industry sources paint, railroads, U.S. SteelpaintrailroadsU.S. Steel Which experts have the greatest incentives to be readily available? Are they biased? Can they be trusted?
16 How to Spin the Press: Give Them What They Need Provide information. Give them a name and phone number of someone to call for a quote or a fact. Always be trustworthy. Correct mistaken statements instantly. Write the story for them! Give them something as a starting point. Create think tank response (Accuracy in Media, Center for Media and Public Affairs, the Media Institute, etc.) Enlist a politician to push your position
17 Coca-Cola Children in Belgium started becoming nauseous after drinking Coca-Cola Was it Cokes fault? Even the Coke managers in Europe and the USA didnt know
18 What strategy should Coca-Cola have used? (a) Lobby the EC regulators (b) Co-opt the opposition (c) Start advertising to influence public opinion (d) Admit potential responsibility (e) Wait two weeks to get the facts correct, then use one of the options above 1. Did the sign-in sheet get around? 2. If you answered a question, bring up a notecard for me.
23 Calgenes Tomato Strategy Marketing channels Lobbying regulators Lobbying politicians Educating the media FDA approval
24 The Unhappy Ending Calgenes political strategy was highly successful. It did get FDA approval. Calgenes business strategy didnt do so well. Consumers didnt find it worth paying a 200% price premium for the tomato. Calgene sold out to Monsanto. The moral: Even with the best political strategy, a company needs a good product produced at a low cost.
25 Business Lessons Identify issues before they are publicized. Head off problems using self- correction or co-opting. Keep good relations with the press and government. Make their jobs easier.