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SMRT: Effective crisis management?

by: Shanta Arul/

In a horrific accident in April, Thai teenager Nitcharee Peneakchanasa lost both her legs falling off an MRT platform ahead of an incoming train. Her family is now suing SMRT for $3.4 million dollars. SMRT ultimately allowed liability concerns to interfere with the way it handled the accident, inevitably presenting itself as an organization lacking compassion, a perception which probably factored into the family’s decision to sue. SMRT failed to effectively manage this crisis, dealing a blow to itself not just in terms of encouraging a lawsuit, but in attracting negative attention from the public

From the newspaper reports, one surmises that the extent of SMRT’s goodwill towards Nitcharee extended to some hospital visits and free transport to and fro the hospital. It seemed as though the company was getting as minimally involved as possible.

Sympathy for the family grew as stories emerged of her family having to travel from Thailand to Singapore by bus and train because they could not afford flights. They arrived a week after Nitcharee’s accident. Weeks later, her father was begging SMRT publicly for help to cover her hospital expenses. Then came the news that SMRT had offered the family only $5,000 to them, an amount which hardly comes close to covering the expenses. As these events unfolded, SMRT remained largely silent. There were no press releases, and much citing of confidentiality and the need to wait and see. Only following the lawsuit filed against SMRT did the organisation offer more insight, stating that it had earlier offered the family S$10,000 as “initial financial support”.

For an esteemed multi-million dollar organisation(SMRT reported a net profit of S$161.1M for FY2011) its financial offerings to the family are a paltry amount, especially when compared to the $400,000 raised by everyday Singaporeans unconnected to the incident.

It can be inferred from all this that ensuring the wrong impression was not created was a key concern for SMRT– by staying at arm’s length from the case and making minimal comment, it would not unwittingly suggest it bore some responsibility. Even though Nitcharee reportedly had a dizzy spell which led her to fall, n terms of responsibility, SMRT is not necessarily off the hook. With the safety barriers being progressively erected at MRT stations all over Singapore, one can argue that SMRT did not ensure the safety measures which could have prevented such an accident.

Rationally speaking, it is impossible to put in place safety measures designed to comprehensively pre-empt every potential accident and I think that people and the courts are reasonable about such realities. However, whether one chooses to raise suit against the overseeing organisation depends not just on whether they feel the organisation is clearly responsible or was negligent in some way, but on their perception of the organisation’s behaviour following, irrespective of their liability. This is where crisis management comes into play, and where SMRT seems to have gone wrong.

SMRT’s strategy of keeping mum backfired, and created for itself a highly negative impression –that SMRT was more concerned about its own liability and protecting itself, than being human and reaching out to a girl whose entire life has been altered as a result of this accident.

Could SMRT have handled it differently? Imagine a different scenario, where SMRT had sponsored the family’s immediate flights to Singapore so that a young girl who had lost her legs in a freak accident could be with her family as soon as possible. Or if they had sent a representative to be with the girl every day, attending to her needs and being a source of comfort. The cost of her treatment in Singapore was estimated at $50,000. If SMRT had engaged the family in a discussion on how they could help them during this difficult time, and effectively communicated the offer to take some burden off the family, evidently unable to foot the hospital bills themselves. SMRT may not have had a legal obligation to have done any of those things, but in doing any of the above, it would have likely resulted in a different outcome.

Any parent would have been aggrieved that in such devastating circumstances the organisation seems to be more concerned with keeping potential costs at bay, or perhaps setting a precedent for such claims in future, than extending a hand to their child? Despite the fact that proving SMRT’s legal responsibility will be a challenge, the decision to sue, which was based on legal advice, can be driven by emotions, and the desire to seek some kind of justice.

It is understandable that any company would attempt to limit its liability as far as possible, if put in SMRT’s position, but its apparent strategy has been myopic. By showing itself to be overly concerned with protecting itself, the organisation showed a lack of compassion which not only had a negative impact on the family, but the Singaporean public.

It now loses out on two fronts. with the goodwill it has lost in the way it previously handled complaints about overcrowded trains, SMRT lost a wonderful opportunity to regain lost ground in the past year by merely doing the right thing and being seen to be doing do.

The question many would ask is, does public opinion matter? SMRT afterall holds a monopoly over train services in Singapore. I would argue that it does. Given the outcome of the recent General Elections, the conduct of a government linked company (GLC) in a manner that screams of a “lack of moral accountability” can have a negative ripple effect on the rest of the government and their affiliates?

What a better handling of the incident would have cost SMRT is a fraction of what they will now likely to have to pay in legal fees, as well time and effort expended to firefight this matter. This may have been nothing close to a real crisis for SMRT, and these are costs it might have been prepared to forgo in the first place. However, there is no saying when a high-stakes crisis will hit, and if this incident is anything to go by, there may very well be cause for concern. If SMRT did not consider effective crisis management as a priority in the past, a re-evaluation of this is much in order.

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*The use of the word "crisis" in crisis management is not specific to a tragedy or large-scale disaster as the word may imply. The terminology is often used to describe the management of a situation which is potentially harmful to the reputation or the running of an organisation.