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The venerable Augusta National Golf Club has been playing host to the Masters Tournament since 1934. But this year it is also playing host to another great drama, the relaunching of the most valuable personal brand in the world. Tiger Woods’s penchant for cocktail waitresses and porn actresses ended up costing an astonishing amount of money: two economists at the University of California, Davis, have calculated that his biggest corporate sponsors, such as Nike and Gatorade, saw as much as $12 billion wiped off the value of their shares in the wake of the scandal. But Mr. Woods’s warm reception at Augusta suggests that he is well on his way to recovering his star power. Brand Tiger is thus likely to join a long list of brands that have come back refreshed after a spell in rehab. These include not just the predictable roster of celebrity brands such as Martha Stewart and Kobe Bryant, but also a surprising number of solid corporate citizens such as Johnson &Johnson and Coca-Cola. Brand-threatening scandals are becoming a regular feature of the corporate landscape, thanks to a toxic mixture of globalisation, which scatters corporate activities hither and yon, and the Internet, which allows bad news to spread like wildfire. Oxford Metrica, a consultancy, estimates that executives have an 82% chance of facing a corporate disaster within any five-year period, up from 20% two decades ago. Indeed, just the day after Mr. Woods made his return to golf, the American government fined Toyota over $16m for its tardiness in addressing safety concerns. The key to a successful relaunch lies in making a cool-headed assessment of how much the scandal damages your company. Does it involve life and limb, rather than less consequential matters’ Has it spread beyond particular products or particular divisions to afflict the entire corporate brand If the answer to both questions is yes, then companies arc well advised to go into collective overdrive; if it is no. then they can experiment with more nuanced responses. such as lopping off a tainted product or sacrificing a rogue division. Marsh & McLennan and JetBlue provide good examples of companies that took a no-holds-barred approach to brand rehabilitation. In 2004 Marsh & McLennan was accused of taking kickbacks to recommend insurance providers to its clients an accusation that went to the very heart of its identity as one of the country’s biggest insurance brokers. The firm was not content with issuing grovelling apologies and paying $ 850m in compensation. It also appointed a new boss, Michael Cherkasky, who was the head of its financial-investigation division, Kroll. Mr. Cherkasky proceeded to de-emphasise the insurance business and boost other divisions, such as Mercer Consulting and Kroll. In 2007 bad weather presented JetBlue with a nightmare of its own. Thousands of passengers were left stranded and one planeload of unfortunates spent eight hours sitting on the tarmac, with precious little food or drink to sustain them. The company’s founder and boss David Neeleman immediately recognised that this made a mockery of his promise to "bring humanity back to air travel". He threw himself into dealing with the problem, issuing public apologies, telling his employees to contact passengers personally by phone and e-mail, producing a retroactive passengers’ "Bill of Rights" and ponying up around $ 25m in compensation. The detBlue case underlines the most important rule of successful crisis management. The boss needs to take charge. This means sidelining corporate cluck-cluekers such as lawyers (who worry that any admission of guilt will lead to lawsuits) or financial officers (who obsess about the bottom line). It also means putting the survival of the company above personal considerations (Mr. Neeleman stepped down three months after the crisis). Many of the most damaging crises, by contrast, have resulted from footdragging at the top as appears to be the case with Toyota today. Crises can even give brands a long-term boost, provided the rehabilitation is properly handled. CocaCola emerged stronger from its disastrous recipe change in 1985. In response to widespread outrage from customers, it reverted to the original formulation within three months. The whole episode reminded consumers of their fierce attachment to Coke, and thus ended up increasing sales. Tiger Woods, too, could well emerge with added lustre from his own debacle. There is nothing Americans like more than a redemption story - particularly when the man being redeemed is supremely good at his job. In terms of brand rehabilitation, the author’s attitude towards lawyers and financial officers is
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In this section you will hear everything ONCE ONLY. Listen carefully and then answer the questions that follow. Mark the correct answer to each question on ANSWER SHEET TWO. Questions 1 to 5 are based on an interview. At the end of the interview you will be given 10 seconds to answer each of the following five questions. Now listen to the interview. According to Dr. Getsy, the advice for people who have trouble sleeping is to
Watchdogs are growling at the web giants, and sometimes biting them. European data-protection agencies wrote to Google, Microsoft and Yahoo! demanding independent proof that they were making promised changes to protect the privacy of users’ search history. They also urged Google to store sensitive search data for only six months instcad of nine. Ten privacy and data-protection commissioners from countries including Canada, Germany and Britain wrote a public letter to Eric Schmidt, Google’s boss, demanding changes in Google Buzz, the firm’s social-networking service, which had been criticised for dipping into users’ Gmail accounts to find "followers" for them without clearly explaining what it was doing. Google promptly complied. Such run-ins with regulators are likely to multiply and limit the freedom of global Internet firms. It is not just that online privacy has become a controversial issue. More importantly, privacy rules are national, but data flows lightly and instantly across borders, often thanks to companies like Google and Facebook, which manage vast databases. A recent scandal dubbed "’Wi-Figate" exemplifies the problem. Google (accidentally, it insists) gathered data from unsecured Wi-Fi networks in people’s homes as part of a project to capture images of streets around the world. A number of regulators launched investigations. Yet their reaction varied widely, even within the European Union, where member states have supposedly aligned their stance on online privacy. Some European regulators ordered Google to preserve the data it had collected in their bailiwicks; others demanded that information related to their countries be destroyed. Despite such differences within Europe, the gap is much greater between Europe and America, home to many of the world’s largest online social networks and search engines. European regulations are inspired by the conviction that data privacy is a fundamental human right and that individuals should be in control of how their data are used. America, on the other hand, takes a more relaxed view, allowing people to use consumer-protection laws to seek redress if they feel their privacy has been violated. Companies that handle users’ data are largely expected to police themselves. Some experts say this dichotomy explains why Silicon Valley firms that strike out abroad have sometimes been the targets of European Union data watchdogs. Jules Polonetsky of the Future of Privacy Forum, a think tank, says that many American firms have yet to learn that showing up in Europe and extolling the virtues of self-regulation is likely to be as ineffective as rightwing politicians denouncing antidiscrimination laws back home. Transatlantic friction between companies and regulators has grown as Europe’s data guardians have become more assertive. Francesca Bignami, a professor at George Washington University’s law school, says that the explosion of digital technologies has made it impossible for watchdogs to keep a close eye on every web company operating in their backyard. So instead they are relying more on scapegoating prominent wrongdoers in the hope that this will deter others. But regulators such as Peter Schaar, who heads Germany’s federal data-protection agency, say the gulf is exaggerated. Some European countries, he points out, now have rules that make companies who suffer big losses of customer data to report these to the authorities. The inspiration for these measures comes from America. Yet even Mr. Schaar admits that the Internet’s global scale means that there will need to be changes on both sides of the Atlantic. He hints that Europe might adopt a more flexible regulatory stance if America were to create what amounts to an independent data-protection body along European lines. In Europe, where the flagship Data Protection Directive came into effect in 1995, before firms such as Google and Facebook were even founded, the European Commission is conducting a review of its privacy policies. In America, Congress has begun debating a new privacy bill and the Federal Trade Commission is considering an overhaul of its rules. David Vladeck, the head of the FTC’s Bureau of Consumer Protection, has acknowledged that "’existing privacy frameworks have limitations". Even if America and Europe do narrow their differences, Internet firms will still have to grapple with other data watchdogs. In Asia, countries that belong to APEC are trying to develop a set of regional guidelines for privacy rules under an initiative known as the Data Privacy Pathfinder. Some countries such as Australia and New Zealand have longstanding privacy laws, but many emerging nations have yet to roll out fully fledged versions of their own. Mr. Polonetsky sees Asia as "a new privacy battleground", with America and Europe both keen to tempt countries towards their own regulatory model. Shoehorning such firms into antiquated privacy frameworks will not benefit either them or their users. "Watchdogs" in the first paragraph refers to
Questions 9 and I0 are based on the following news. At the end of the news item, you will be given 20 seconds to answer the questions. Now listen to the news. What does North Korea blame U. S. for
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