Most companies are wholly unprepared to deal with the new nastiness that's erupting online. That's worrisome as the Web moves closer to being the prime advertising medium?and reputational conduit?of our time. "The CEOs of the largest 50 companies in the world are practically hiding under their desks in terror about Internet rumors," says top crisis manager Eric Dezenhall, author of the upcoming book Damage Control. "Millions of dollars in labor are being spent discussing whether or not you should respond on the Web."

In the beginning, the idea of this new conversation seemed so benign. Radical transparency: the new public-relations nirvana! Companies, employees, and customers engage in a Webified dialectic. Executives gain insight into product development, consumer needs, and strategic opportunities. All the back-and-forth empowers consumers, who previously were relegated to shouting at call-center minions. Venom can be a great leading indicator.

When the Web turns against them, executives are faced with the problem of how to manage the blowback. They have two choices: ignore the smaller furies and hope they won't metastasize, or respond outright to the attacks. It's rarely a good idea to lob bombs at the fire-starters. Preemption, engagement, and diplomacy are saner tools.

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