2011-01-19 08:12

SHANGHAI - Chinese enterprises are slow to recognize emergency situations and perform poorly when handling public relations crises, according to a recent report.

The report, compiled by the public opinion research laboratory of Shanghai Jiao Tong University, looked at the 50 most prominent PR events in 2010 and analyzed the responses made by the enterprises concerned.

"We found Chinese enterprises' ability to respond to a crisis is basically weak in areas such as problem solving, issue management and communication," said Xie Yungeng, deputy director of the university's Institute of Arts and Humanities, who helped write the report.

He singled out a lack of judgment as the cause of many enterprises' failure to handle crises as and when they arise.

According to the report, half of the 50 cases included in the study occurred in private enterprises, 26 percent in State-owned enterprises, and 24 percent in foreign firms or those from Hong Kong, Macao and Taiwan.

The enterprises involved in these cases were largely concentrated in information technology and the light food industry. The crises to which they responded had to do with illegal operations, product quality, poor internal management, or an accident or disaster that occurred, usually in the country's developed areas, such as Beijing and Guangdong province, the report said.

It also noted that new media, such as micro blogs and BBS (bulletin board systems) are playing an increasingly important role in enterprises managing emergent crises. This was underscored by 44 percent of the 50 cases in the study initially gaining public exposure through new media.

"In the face of an emergency, enterprises are increasingly turning to new media for assistance," said Xie, who added that it has been proven that new media can effectively and efficiently help put a positive spin on events.

For instance, in July 2010, a Hong Kong magazine reported that two products made by BaWang International (Group) Holding Ltd, China's largest herbal shampoo maker, contained a substance that may be carcinogenic. The company immediately responded to the report by starting up its own micro blog, which it updated 17 times within a four-hour period.

The report further stated that State-owned enterprises generally have a good rapport with the government and that crises were easily resolved by government intervention.

However, State enterprises were noticeably slower in responding to sudden events, according to the report, often adopting an intransigent attitude or subscribing to the ostrich policy.

Many State-owned enterprises have been slow to adopt the new media and tend to rely on traditional outlets for their messages, which are not as effective in reaching the public, Xie said.

In contrast, private enterprises are generally able to respond to PR crises quickly and positively, efficiently using new media, such as micro blogs, to win the support of the public through effective communication.

Foreign-funded companies as well as those from Hong Kong, Macao and Taiwan, performed moderately well at handling crises, although they were weaker at communicating with the public and lacked judgment in emergency situations, Xie said.