Analysis of Talk Talk response on Cyber-Attack Crisis in October 2015 - Coursework Example

STUDENT’S NAME: ADMISSION NO: NAME OF THE INSTITUTION: Table of Contents Table of Contents 2 1.0 Introduction 3 1.1 Image Restoration Theory 3 1.2 Shareholders Theory 4 2.0 Context 5 3.0 Data 6 4.0 Methodology 8 5.0 Findings 9 5.1 Compensation 11 5.2 Corrective Action 11 5.3 Bolstering 12 6.0 Conclusion 12 TALK TALK CYBER ATTACK RESPONSE 1.0 Introduction The image and reputation of any given company is a critical aspect which must always be maintained. Therefore, any given entity that desires to keep it clientele base must always try to defend its goodwill in whichever way possible. This can always be done through offering apologies, rationalizations and critical explanations to the interested parties. Several bodies have different ways of addressing their reputations as follows: 1.1 Image Restoration Theory According to Benoit (2000), this is a theory that was invented by a scholar known as William Benoit so as to illustrate the mechanisms that can be used by an entity to repair their damaged reputation. According to Willian Benoit (2001),an entity through its leadership often tries to explain to the interested parties about the circumstances that led to the alleged accusations. Often it involves organizing a press release and writing a communication to explain the alleged crisis in question among others. Ideally, the reputation of an entity can be somehow repaired but a full restoration of the initial company goodwill may never be achieved as intended (Benoit 2000). Image Restoration Strategies may include:- Denying the allegations falsehood and only intended to taint the reputation of the entity especially when initiated by the competitors Transferring the blame to a third party that may have played a part in the alleged accusations The entity my consider bolstering; this involves outlining the good activities and practices that the entity has been involved in or aspires to be engaged in so as to keep up with their clientele’s trust. Compensate the parties that might have been implicated by the crisis that may have encroached the organization. 1.2 Shareholders Theory This is a theory that determines the relationship between a firm and those in its external and internal environment. It depicts how these relationship influences the firm’s operations. The shareholders on the other hand are the individuals or the group that affect or can be affected by the firm. They include the suppliers, employees, stockholders, customers, government and the local community around the firm (Ackermann & Eden 2011). As an organization, the interests of our esteemed customers, shareholders, our suppliers, community, the Government and our employees must always be given priority (Sherman & Gorkin 2008). As a result, we desire to assure our shareholders that Talk Talk Group has taken an initiative to ensure that their goals and objectives are adhered to as stipulated in the Memorandum of Understanding. Therefore we have decided to update our system on a timely basis so as to enhance the security of the system. We want to guarantee our shareholders especially our customers that the security of their data will be enhanced and therefore there should be no course of alarm. On the other hand we are in investigating this incident and will share promptly upon completion of the investigation that are currently being undertaken by the cyber crime specialists in conjunction with the Metropolitan Police Cyber Crime Unit. We are going to contact all our customers and share with them the necessary information in addition to offering them advise with regard to the cyber crime attach that was witnessed in our website. 2.0 Context As stated by the CEO Dido Harding, Talk Talk was faced by some unfortunate incidents due some insecurity related issues. On Wednesday 21st October, 2014, our website experienced significant and sustained cyber attack by unknown group of cyber criminals. We suspect the following data might have been accessed and tampered with:- Name of our customers Customers’ phone numbers Customers’ physical and email addresses Credit Card/Bank Details Talk Talk Account Information Customers’ Date of Birth However, On Thursday 22nd October, 2015, we engage Metropolitan Police Cyber Crime Unit inconjuction with cyber crime specialists who have launched a criminal investigation to apprehend the culprits. We value the security of our customers’ data and hence taking all the necessary measures to establish the extent of the damage. As a matter of fact, we contacting our customers hence forth with information, support and advise with regard to the cyber crime incident in our website. 3.0 Data In regard to the cyber crime attack as explained above, the management of Talk Talk Telecom Group released upon of press statements to address the situation as outlined in the table below Date Press statement headline 22 Oct 2015 Press release “Statement by Talk Talk PLC on Cyber Attack” This was basically to give an overview of what really happened and the correction action taken to against the unfortunate incident in the organization’s website 24 Oct 2015 Press release “Cyber Attack update-Saturday October 24th 2015” The release was ideally to give an update on the ongoing investigations, that is the investigating teams’ findings so far and customers’ assurance 26 Oct 2015 Press release “Cyber Attack update-Monday October 26th 2015” This intended to assure the shareholders that the credit and card numbers were protected and were never affected at all.However, The Bank details might have been accessed but the information therein was not enough to enable the culprits withdraw any money 26 Oct 2015 Press release “Talk Talk PLC responds to Metropolitan Police update” This was intended to inform the shareholders’ about the arrest of one of the suspects behind the cyber attack by the Metropolitan Police 27 Oct 2015 Press release “Cyber Attack update-Tuesday October 27th 2015” The organization was reminding the customers’ of the safety of the money based on the fact that the accessed information was insufficient to be used by the culprits. Meanwhile the arrested suspect was helping the police with investigations 30 Oct 2015 Press release “Cyber Attack update-Friday October 30th 2015” This was basically to update the customers that the extend of the damage was minimal and there was no course of alarm. However, the Metropolitan Police is still carrying out the investigation 06 Nov 2015 Press release “Cyber Attack update-Friday November 06th 2015” The release ideally stated the number of customers implicated by the attack and the exact data accessed. Meanwhile the damage was much less than initially thought 11 Nov 2015 Press release “Talk Talk reaffirms commitment to customers” The organization was basically informing their customers of their commitment towards their well being and thus had a variety of offers in terms of free upgrades to provide to their customers 4.0 Methodology The image restoration theory has pioneered by William Benoit can be used to state some strategies that are vital in mitigation of damages especially towards ruined reputation. The theory acts as mechanisms in enhancing understanding of problems in the corporate world. This theory ideally illustrates the crisis and the subject related to the crisis. Typology of the Image Restoration Strategies As stated William Benoit, the theory provides five image restoration strategies which tend to address the challenges with regard to the crisis in question. Strategy Key Characteristics Illustration Bolstering Stress Good Traits The company intends to offer upgrade to its customers’ broadband. Corrective Action Plan to solve/save from Talk Talk confirm to start having reoccurrence constant update of its system to maintain security Down play Did not perform the act The organization stated that the access inform was to little to have any serious damage. The accessed bank details cannot be used to withdraw customers’ Victimization The company took the blame Talk Talk felt sorry for the Unfortunate incident and took the blame 5.0 Findings As stated in the Press release dated 22 Oct 2015, Talk Talk Group seems to have never been involved in a crisis which requires a comprehensive response through issuance of press statements. However, upon the cyber attack on its website, the company took a high level of responsibility by responding adequately taking into consideration a number of strategies as outlined by William Benoit (1997) in his image restoration theory. The company utilized the William Benoit’s image restoration theory to respond to the cyber crime attack on its website. In order to retain the clientele base following its damaged reputation as result of the attack, the company utilized the following strategies:- Bolstering During the press release of Nov 11th 2015, the company announce free upgrade to each and every Talk Talk household in recognition of the cyber crime incident. Like the following selections were to be added by the customers to their packages at no extra costs TV content including movies, kids entertainment and sports; • A mobile SIM with a monthly allowance of free texts, data and calls; • Unlimited UK landline and mobile calls; • A broadband health check by experienced engineers; Likewise the CEO stated the following during his press release,” In the last six months, the value for money provider has seen over 130,000 new mobile customers take its SIM, handset and tablet bundles. The demand for flexible and affordable mobile deals has also led TalkTalk to take a 14% share of UK new SIM-only connections between April and September, boosting its mobile customers to c.0.6 million.” Corrective Action The CEO stated the following while during the press release dated Oct 24th 2015, “TalkTalk constantly updates its systems to make sure they are as secure as possible against the rapidly evolving threat of cyber crime, impacting an increasing number of individuals and organisations. We take any threat to the security of our customers’ data extremely seriously and we are taking all the necessary steps to understand what has happened here. As a precaution, we are contacting all our customers straight away with information, support and advice around yesterday’s attack.” Likewise, Talk Talk Group through its broadband service provider, promised to create a new bundle of online and telephone with enhanced security features so as to protect users from scammers, cold callers and malware. The company has also created a pool for posting “thank you” notes to its customers regardless of whether they were affected by the cyber attack or not. Down Play The CEO said the following “it is the unlikely that money is stolen from your bank accounts since the information accessed by the suspects as insufficient to enable them access any money.” 5.1 Compensation As reported in the press release of 11 Nov 2015, The company promised to compensate its customers when it promised to offer them an advanced broadband service practically with high level security features to protect them against future occurrence of such malpractices 5.2 Corrective Action As outlined by the CEO in his press statement of 30 Nov 2015, the company intended to create a large scale gesture of thanks for all the Talk Talk Group’s customers both implicated by the crisis and those who were not. 5.3 Bolstering The company while releasing its press statement on 11 Nov 2015, announced an incredible growth, whereby the last six month in its operations, the company had witnessed the value of its money provider grow with over 130,000 new mobile customers taking up its SIM, tablet bundles and handset. On the other hand, the demand for flexible and cheaper mobile deals had seen Talk Talk Group increase their market share in UK increase to 14%, that is, for the SIM usage between April and September only hence increasing its customer number to 0.6 million The superfast fibre brand had also been appreciated by its customers hence attracting an addition of 99,000 new fibre customers taking the tally to 578,000. On the same platform, the company’s joint venture with both Sky and CityFibre so as to bring the Ultra Fibre Optic broadband to York had also seen an incredible growth with a number of triallists signing up to be amongst the first batch of service users which was anticipated to be 100 times faster than the standard broadband. 6.0 Conclusion In respect to the findings stated above, the company’s interest is to ensure its shareholders’ welfare is given priority. Therefore, the increasing growth in terms of customer base will ensure the profit of Talk Talk group increases hence maximizing the dividends expected to be paid to the shareholders of the company. At the same time, the company in affirming that its conform to the expectations of the society, has decided to offer an apology to its customers with the intention of having them know that the company respects the will of the people and hence feels sorry for the unfortunate incident. BIBLIOGRAPHY Ackermann, F., & Eden, C. 2011. Strategic management of stakeholders: Theory and practice. Long Range Planning, 44(3), 179-196. Benoit, W. L. 2000. Another visit to the theory of image restoration strategies. Communication Quarterly, 48(1), 40-43. Benoit, W. L. 2007. Hugh Grant's image restoration discourse: An actor apologizes. Communication Quarterly, 45(3), 251-267. Berman, S., Jones, T., & Wick, A. C. 2009. Convergent stakeholders theory. Academy of Management Review, 24(2). Blaney, J. R., Benoit, W. L., & Brazeal, L. M. 2002. Blowout!: Firestone’s image restoration campaign. Public Relations Review, 28(4), 379-392. Dean, D. H.2004). Consumer reaction to negative publicity effects of corporate reputation, response, and responsibility for a crisis event. Journal of Business Communication, 41(2), Fred Garcia, H. 2006. Effective leadership response to crisis. Strategy & Leadership, 34(1), 4-10. Jones, D. S., & King, K. K. 2011. The implementation of prompt corrective action: An assessment. Journal of Banking & Finance, 19(3), 491-510. Sherman, S. J., & Gorkin, L. 2008. Attitude bolstering when behavior is inconsistent with central attitudes. Journal of Experimental Social Psychology, 16(4), 388-403. Siomkos, G. J., & Kurzbard, G. 2012. The hidden crisis in product-harm crisis management. European journal of marketing, 28(2), 30-41. Press release https://www.youtube.com/watch?v=Or4ir9KMHAs Read More