The American Electrical, Inc. (AEI)

The American Electrical, Inc. (AEI) is in a middle of an environmental crisis that is likely to impact the listed firm’s stock value, profits, and brand. AEI’s relationships with its clients, employees, and the community in Marietta, Georgia where it is headquartered are also likely to be adversely affected in the face of the looming problem. The purpose of the communication plan, therefore, is to stem the damages that the company will be taking on by outlining and implementing a strategy to transparently communicate several key messages.

These messages include the roles of AEI, Multi-Phase Equipment, Inc. , Wiregrass Disposal, Inc. , Independent Laboratories, Inc. , and Georgia Department of Environmental Protection (GDEP) in the situation; a comprehensive timeline leading to the situation; the tactical response of AEI to the situation; as well as the strategic response of the firm to avoid similar situations from happening in the future. This communication plan is important because it will address all anticipated and possible concerns of AEI’s stakeholders, which include the people in Marietta, customers, employees, government agencies, stockholders, and the press.

Potential Crisis AEI is at the breach of crisis. This is because it is probable that it will be liable for the cleanup of PCBs, compliance with government regulations, and compensation of any damages caused by its and Multi-Phase’s environmental oversight. The situations that contributed to the crisis are the following. First, AEI failed to substantiate the findings of Independent Laboratories that the air, water and soil quality of Multi-Phase Equipment passed quality standards.
Apparently, Independent Laboratories’ samples were not representative and its work did not reveal the fact that illegally buried PCBs were hidden in the site. GDEP excavated in the far northeast corner of the Multi-Phase Equipment site that is adjacent to the WSA treatment plant. It uncovered 200 drums of PCBs, some 25 of these drums have rusted through, that were not supposed to have been buried there. Second, AEI bought Multi-Phase Equipment six months ago for $6. 5million in stock and cash without performing due diligence on its and its contractors’ environmental compliance.
Moreover, it failed to follow up on its possible interests in Wiregrass Disposal when the latter filed for bankruptcy protection. Wiregrass had been responsible for packaging, loading, transporting and properly disposing PCBs as well as maintaining state and federal records for materials removal from the Multi-Phase Equipment site. Third, AEI did not act proactively on possible connections between residential customers’ complaints about the foul taste and smell of water and the company’s resources adjacent to the Water & Sewer Authority treatment plant.
GDEP said that the buried PCBs leaked but the leakage area is contained and is unlikely to be connected to the foul water quality in Marietta. Its hypothesis is that the source of the unpleasant taste of water is algae. Fourth, AEI did not double-check if employees in the plant near where the PCBs were uncovered are indeed safe from health hazards. It must ensure that the employees are actually safe or else it will be liable for paying possible health claims from the workers, an incident that can further hurt AEI’s standing. Contacts
Because of the severity of the situation, the Executive Committee of the AEI must comprise the crisis management team. The Executive Committee can immediately manage corporate time and resources to ensure swift and suitable actions on the part of the company. The first message of the Executive Committee must be the urgent actions that AEI will be taking to remove the PCBs; its coordination with GDEP in terms of holistic environmental regulation compliance; and legal claims that it will might against Wiregrass Disposal and Independent Laboratories.
The second message of the Executive Committee must be the strategic plans and procedures that the company will implement for stringent and uncompromising environmental compliance. The company spokesperson must be Executive Committee member in charge of government regulations compliance. Walter Martinson can release special announcements to public, press, stockholders, customers and employees as necessary.