tepco by the numbers
DESCRIPTION
A brief look at how B2Bs fail to adequately explain numbers and terms during crises, using TEPCO as a starting point.TRANSCRIPT
TEPCO by the Numbers
Gil ChavezProfessor, Globis Univ. IMBA
BC Consultingwww.consult-bc.com
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The numbers are the numbers
• Crisis Communications and Investor Relations (IR) both involve messages and numbers.
• Crisis Communications tends to focus on messages more than the numbers.
• That is a mistake.
2
The numbers are the numbers
In crisis communication this should be vital early step:
Place the numbers in context-- Make them understandable
If not, someone else will…and it may not be fair or accurate.
The numbers are the numbers
Why is this a crisis communication problem? • Investor relations has accounting rules and regulations.
• Audience agreement on numbers’ meaning.
• Crisis numbers often have wider scope of interpretation, even in heavily regulated industries.
• Audiences extend beyond experts.
• Issues open to greater debate.
TEPCO by the Numbers
• Let’s look at today’s numbers
The numbers are the numbers
• Fukushima Dai-ichi 2011: • 9.0 earthquake; 15 meter high tsunami• 250,000 tons of radiation-tainted water• exposure of 100 mSv
• BP Gulf Oil Spill 2010• 4.9 million barrels of oil
• Intel Pentium Chip 1994• Error once every 9 billion calculations
• Botswana 2002• 38.8% of adult population AIDS/HIV positive
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TEPCO by the Numbers
• How numbers define events
TEPCO by the Numbers:An unprecedented event?
1st Context –
Fukushima Dai-ichi: • 9.0 earthquake
• 4th strongest ever
• Tsunami up to 38 meters high in some areas
• 15 meter tsunami at the plant
• Once in 200 years occurrence, right?
TEPCO by the Numbers:Context is king
2nd. Context – Fukushima Dai-ichi• 4 powerful Sanriku tsunami in 140 years• 1793, 1856, 1896 (record height), 1933
• March 11 was 5th event in 218 years = Every 43.6 years
• Dai-ichi completed 1971, lifespan 50 years• Sea wall 5.7 meters• The bet was that there would be no major tsunami from 1933
through 2021, nearly 90 years.
TEPCO by the Numbers
• Audiences get lost in large numbers
Lost in numbers
If your heart beats 60 times a minute, how long will it take to beat • 1,000 times?
XX
• 1 million times? (1,000,000)
XX
• 1 billion times? (1,000,000,000)
XX
• 1 trillion times? (1,000,000,000,000)
XX
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Lost in numbers
If your heart beats 60 times a minute, how long will it take to beat • 1,000 times?
Just under 17 minutes (16.67 mins)
• 1 million times? (1,000,000)
About 11.5 days (277.78 hours)
• 1 billion times? (1,000,000,000)
About 31.7 years (11,574 days)
• 1 trillion times? (1,000,000,000,000)
About 31,709 years (Last Ice Age peaked 20,000 years ago – 1.5 Ice Ages)
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TEPCO by the Numbers
• Audiences get lost in technical terms.
TEPCO: Water by the ton
“I went to the store for a kilo of milk…”
May 29, 2011 Yomiuri Shimbun• “It will cost about 53.1 billion yen to decontaminate
250,000 tons of radiation-tainted water….”
• How much water is that?
TEPCO: Water by the ton
250,000 tons of water = 100 Olympic Swimming PoolsOlympic swimming pool (OSP): 2,500 metric tons of waterOSP = 1/200,000 sydharb (Sydney Harbour)
TEPCO by the Numbers
• Combined numbers and terms
Sievert (Sv), a measure of radiation:
Millisieverts vs. Microsieverts
• Which is more and by how much?1. Millisievert: 1 mSv = 0.001 Sv (1/1,000)
2. Microsievert: 1 μSv = 0.000001 Sv (1/1,000,000)
Millisieverts
Press Release:
Status of Fukushima Daiichi Nuclear Power Station
(as of 9:00 am Mar 17th, 2001) • “The radiation exposure of 1 TEPCO employee, who
was working inside the reactor building, exceeded 100mSv and was transported to the hospital….”
Millisierverts
Which means what?
Estimates measured annually or hourly: • 9 mSv per year: Air crew on NYC – TOK polar route• 100 mSv per year: Lowest level related to long-term, but
extremely low, cancer risk• 800 mSv per hour likely to cause radiation sickness;
may increase risk of cancer by 2 to 4 percent.
TEPCO Press Release (Apr 12, 2011)Fukushima and Chernobyl both Level 7 Nuclear Events
• Level 7 Rating for the Incident at Fukushima Daiichi“ We recognize that the problems at Fukushima Daiichi Nuclear Power Station due to Tohoku-Chihou-Taiheiyou-Oki Earthquake have led the government to assign provisionally level 7 on INES (International Nuclear Event Scale). We deeply apologize for the public's distress and inconvenience at the surrounding areas of the power station, Fukushima Prefecture, and broader society. In order to resolve the situation as soon as possible, we will proceed to cool the reactors and to prevent the diffusion of radioactive materials. In addition, we are considering various countermeasures and their processes. Cooperatively working with the national and local governments, we will concentrate all our resources to resolve this difficult situation.” Masataka Shimizu President The Tokyo Electric Power Company, Incorporated
TEPCO by the Numbers
• If you don’t define it, someone else will.
New York Times: Fear sells
“Radioactive cesium was detected in broccoli in Fukushima Prefecture well above the country's limit.”
First reaction? That’s scary.
“The estimated increase in cancer risk of eating two unwashed pounds is about two chances in a million.”
Second reaction?
TEPCO by the Numbers
• Other crises
Intel Pentium crisis 1994
What did Intel initially do?
Sept – Nov.• Insist error was insignificant
• Offer consumers a white paper
• Chip replaced only after close questioning
Intel Pentium crisis 1994
Late Nov/Dec describes error occurring:
• “in certain types of division problems involving more than five significant digits … that can include numbers before and after a decimal point.”
• “in complex mathematical calculations and will not affect most computer users”
• Occurs 1 in 9 billion calculations
Intel Pentium crisis
Mid-Dec Intel says:• Error 1 in 9 billion calculations
• Or once every 27,000 years -- could say “nearly 1.5 Ice Ages”
Too late, IBM refuses to ship Pentium PCs:• Says the error happened more frequently
• Every 24 days….
Intel Pentium crisis 1994
After crisis passes: New York Times• “If…the Pentium chip were magnified to the size of New
York City's road, train and subway systems, the flaw would be the equivalent of a few misdirected traffic lanes in the Bronx. Most New Yorkers do not drive in the Bronx, but for those who do, the error is important.”
Reader: “But if I were to drive in the Bronx….”
BP oil spill 2010
Initially underestimated size of spill
Final total --
4.9 million barrels of oil
(a large number and an unfamiliar term)
And that means….?
BP oil spill 2010
312 Olympic Swimming Pools (206 million gallons)
That’s a lot.
And this is a lot more:• Gulf of Mexico total volume: 660 quadrillion (15
zeros) gallons
• Roughly a 1:1 billion ratio
BP oil spill 2010
• “If the Gulf of Mexico were the Superdome, the total spill would be three cans of beer inside.”
• In Tokyo terms: 1 can of beer inside the Tokyo Dome(1 Superdome = 3 Tokyo Domes)
Botswana AIDS rate 2002
Objective: Promote tourism and diamonds
What I wanted to say:• “Produces 1/3 of gem quality diamonds in world.”
What I had to say:• “World’s highest AIDS/HIV rate: 38.8 percent adult
population.”
Botswana AIDS rate 2002
How I said it with context:
“38.8 percent is the highest documented rate in the world.”• Why?
• Botswana’s huge counter-program
• Neighbors had no counter-programs
• Diamond revenue main resource in fight
• 2009• 24.8 percent in 2009
• On the map as a tourist destination
Conclusions: “Crises force B2B’s to speak directly to consumers.”
Once the story is shaped, it is difficult to transform• Focus on the numbers BEFORE the crisis.• Put them into understandable terms.• Place them in context.
Conclusions: “Crises force B2B’s to speak directly to consumers.”
• Think like a non-expert.• What does the number/term mean?• How can it be related to people’s daily lives?• Get outside the box -- ask for outside review.
TEPCO by the Numbers
Thank you