CorpComms Magazine

With long, snaking queues and increasingly disgruntled passengers at its airports, key executives resigning and a major Competition Commission probe to deal with, BAA and its new Spanish owners ought to have been in communications battle mode this summer.

 Unfortunately, the strategy they chose to fight these varied campaigns seemed more like a silent war than one seeking to win hearts and minds. Spani sh cons t r uc t ion g roup Ferrovial has held a controlling stake in the British airports group for a year, gaining control just before the alleged terror plot at Heathrow in August 2006 and the consequent chaos due to tighter security. But its approach to communications since the takeover can be seen as a textbook example of the problems that can occur when the independence of communications departments is compromised.

Since the takeover, nine senior executives, including the chairman, chief executive and finance director, have left BAA, as operational turmoil combined with poor communications with the UK media, politicians and regulators to turn BAA into one of Britain's most unpopular companies.

As well as the shoddy conditions at Heathrow and lengthy queues that sparked a media feeding frenzy, there was a bungled attempt by BAA to obtain an injunction preventing environmentalists protesting at the airport over the company's plans for a third runway. And after more intervention by the Spanish management, the company had to deal with the high-profile resignations of two of its top communication chiefs amid more bad publicity.

The final blow came after Ferrovial's executive chairman Rafael del Pino intervened at the 11th hour to cancel an interview with BAA chief executive Stephen Nelson for London's Evening Standard newspaper, which had been highly critical of the company.

Del Pino then imposed what management members themselves described as a 'media lockdown', preventing director of corporate affairs Duncan Bonfield and head of media relations Mark Mann from speaking to the press, except for answering routine factual questions. Cue the resignations of the two communications executives after the Daily Telegraph splashed the impending departures in its business section.

Different strokes

 Bonfield and Mann were reported to be 'aghast at Ferrovial's inept communications', which became even more difficult after the imposed blackout. But Ferrovial is only the latest example of a foreign firm not understanding UK media.

'US clients in particular find the UK financial media very difficult to engage with,' says Nick Miles, chief executive of M:Communications. 'The US corporate culture is very formal and legally enforced. US business leaders say very little without the approval of their legal counsel and very seldom stray from the agreed script.

'US journalists are far more scrupulous about checking quotes and facts, possibly because they are aware they may be sued or because they have become inured to the US way of doing business. Whatever the case, in the US, business is business; in the UK, business is showbiz.'

'The classic situation is the difference between the US and Europe,' adds Tom Wells, managing director of Gyroscope, a consultancy for companies that invest significantly in public relations and communicat ions. ' If a European company is bought by an American company, you'll often find that the US parent firm will not properly consider the size and importance of the UK media, and it will try to restrict local communications people from speaking and working effectively. [US parent companies] tend to ignore problems and then try to over-control them.'

Wells says there are other differences within Europe: in Sweden, for example, the culture is not to brag, boast or make a noise about oneself.

'If a Swedish company was to buy a British company it might well be stunned by the aggressive approach of the UK press,' he suggests. 'Senior people at German companies are often absolutely terrified by the UK media. The German media are much more compliant, particularly toward big business. Companies in France, Spain and Italy are probably also used to getting an easier life from the mainstream financial and corporate press. There is less hostility and public aggression in the press there.'

Wells says such cultural differences can cause managements to react badly in their communications in three ways: they can become too hostile and aggressive, too defensive and closed-off, or far too open, losing track of the communications message. 'The lesson is to hire locally, make sure you hire the best - and then listen to them,' Wells advises.

Lost messages

In BAA's case, commentators say the company's actions to avoid the media resulted in a vacuum that led to the group becoming even more of a media whipping boy because there was nobody to put its side of the story. On the issue of the congestion at Heathrow, for example, BAA failed to shift the blame to the planning delays that have resulted in an airport that was designed for 48 mn passengers a year having to handle 20 mn more than that.

'To have any chance of keeping this company together, you have to come out fighting, but the Spanish think they can just do deals in Whitehall corridors,' says one former BAA executive. 'It's not just relations with the media that are in disarray; they're not winning the arguments with politicians or the regulators, either.'

Wells believes the communications and operational failings were intertwined. 'BAA's communications difficulties were hugely compounded by its operational difficulties, and the operational problems were made worse by the communications failings,' he observes. 'The operational problems would have been less damaging if the company had been able to communicate effectively.'

'BAA's communications strategy was clearly not going to work,' points out Charles Stewart-Smith, founder of crisis management public relations company Luther Pendragon. 'Foreign clients usually prefer things to be written down and more controlled because they don't understand the nuances of the way the press behaves in the UK.

'They don't understand two things: the first is that if you say nothing to the UK press, it will write nothing - which is completely wrong, of course. Newspapers just end up writing things that are less well informed and sometimes inaccurate. Secondly, foreign firms tend to think that if you issue a statement, the UK press will report it in full, which of course it often doesn't. These are the two most common misconceptions and they are usually compounded by the fact that this is how corporate lawyers often think about the press, too.'

Stewart-Smith says it is common for in-house communicators faced with the kind of lockdown Bonfield and Mann encountered to engage external agencies to carry out 'unofficial and informal' communications with the press.

'I think it is a good idea to use a third party if you're in that situation, because it can work outside the lockdown,' he explains. 'If you're in a situation where your owners are doing enormous reputational damage to the company by insisting on a media strategy you know is not going to work, you can use an agency to carry out communications work for you.'

Smooth beginnings

Miles believes cultural communications issues need to be ironed out at the beginning of takeovers. 'Whether a new owner is European or American, the key task is to explain the different rules of engagement and the ability or otherwise of the UK media to turn what may seem to be an in-house operational issue into a national and very public campaign,' he says.

'Very often the media respond more to the way a company is communicating than what it is actually doing. That was clearly the case at BAA where, frankly, the airports have long been a national disgrace. The tipping point for a massive media backlash appears to have been the shutting up of shop on the communications side.'

Not all commentators agree, however. One director of a major PR consultancy says: 'In terms of BAA's handling of the media, it has been just about as disastrous as it possibly could have been - but this is not really a communications issue; it's about operational failure. The poor communications were just a symptom of something much deeper that was wrong. Ferrovial completely failed to understand the extent of customer unrest.

'If people think this is another story about shooting the messenger, they are missing the point.'

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