How to Break the Oscars: Risk Management at the Academy Awards

Botched award announcement? It could get worse. A lot worse.

The Oscars’ Moonlight / La La Land mix-up was truly a gaffe for the ages. Here it is one more time, if you want to relive the awkwardness and the spectacle:

Amazing, right? And yet, not entirely unforeseeable. As details have come out about the incident, we’ve learned that the system was far from foolproof, and that plain old human error led to the wrong envelope being handed out.

Fortunately, the accountants of PricewaterhouseCoopers did have someone checking the list against what was being said onstage, just in case this sort of thing happened. And it could have been a lot worse: the broadcast could have ended before anyone caught the mistake. As chaotic as those few minutes seemed, at least the institution had some sort of plan to contain the damage and partly correct it.

The Academy Awards ceremony is a high-stakes, worldwide media event. The organizers should be well versed in “risk management,” which is fancy MBA talk for thinking carefully about things that could go wrong and coming up with plans either to reduce the chance of them happening or to deal the aftermath when they do. That extra Emma Stone envelope that led to the blunder? A a risk management strategy in itself: the accountants maintain backup envelopes, in case the others get lost, stolen, or damaged. Once the Moonlight mistake left Warren Beaty’s lips, the PwC person with the control list immediately noticed something was wrong and got the appropriate people to interrupt the La La Land speeches. Risk management at work.

An incorrect announcement is just one of a dizzying array of risks the Oscars producers account for. Some are obvious, ranging from terrorism (hire private security to augment government security forces) to on-screen misbehavior (bleep a curse word using a broadcast delay; cut to commercials).

Others are less obvious and more interesting to think through. So let’s put ourselves in the shoes of the various stakeholders responsible for putting on the Oscars. We want to protect the short- and long-term money-making opportunities of the ceremony itself and the movie industry writ large. What else could go wrong? Like, really wrong? And how would we manage that risk?

Results Leak In Advance

PwC may have egg on its face for the Best Picture mistake, but a far worse outcome would be for some or all of the results to leak in advance, thereby ruining the big reveals in the show itself.

But it would that be so bad? If the Oscar results were leaked, and not immediately debunked like they were in 2009, there would be massive buzz and speculation leading up to the broadcast concerning whether the leak were authentic. It would be a massive ratings bonanza. Sure, it’d a one-time only thing, as the process would need to be tweaked or revamped to prevent a future leak, but it would certainly inject additional publicity on the ceremony, which continues to lose viewers year after year.

Incapacitated Host

Best I can tell from my research, there’s never been a host who failed to show up for the gig. In 2011, James Franco may have been mentally absent, but he wasn’t hit by a bus on the way to the show. Even though it’s never happened, I’m sure the show’s organizers attempt to reduce the risk of this happening by screening out people who present mental or physical health risks, inserting various clauses into the contract that prohibit risky behavior leading up to the show, and providing ample physical security immediately prior to and during the ceremony.

But this can’t account for everything. It’s entirely within the realm of possibility that a chosen host could be taken out of commission unexpectedly, with little time to find a replacement. I failed to find any evidence that the Oscars deliberately chooses an understudy or backup for the role, so we’re left to speculate on what the plan would be, and the effect.

Again, I don’t think this would be the end of the world for the Oscars. The show organizers would likely tap a de facto understudy, someone like Billy Crystal or Whoopi Goldberg with loads of hosting experience who could either perform pre-existing material or come up with a small amount of new material on short notice. Audience interest would be elevated, and expectations would be lowered.

It’s almost too convenient. Perhaps the organizers could skip on the no motorcycling contract clause next time and just roll the dice.

Trump Police State

Hollywood has a preoccupation with dystopias, so I’m sure they’ve thought this one through. Imagine a world where President Trump declares emergency martial law, jails opponents at will, and imposes heavy censorship on media, including the Oscars telecast. The government tells the organizers in no uncertain terms that criticism of Trump will not be tolerated: dissenters will be booted from the show, jailed, or worse. Hell, let’s go one step further and assume that Trump mandates that the program itself be a tribute to him, in addition to whatever movies that the state pre-approves for awards.

A short-term outlook might suggest going with the flow and acceding to the regime’s demands, but a more long-term outlook would factor in the lost credibility and moral standing after the regime is deposed. And lest you think that left-leaning Hollywood would never accept this sort of thing, remember that the blacklist of suspected Communists was a real thing carried out by the Motion Picture Association of America and the Screen Actors Guild.

Oh, and as of this writing, Disney President Bob Iger still sits on President Trump’s business advisory panel.

Collaborate for the short-term, or resist for the long-term?  History and current events sadly suggest the former. Perhaps more accurately, Trump would be seen as an opportunity rather than a risk for the Oscars.

The Movies Die

Sure, 2016 was another record-setting year at the domestic box office, but Hollywood can’t seem to stop fretting over its own demise at the hands of HBO Now, Snapchat, VR, or some combination thereof. Movies probably won’t die completely, but they may change drastically from the current model. If that happens, do the Oscars survive?

It’s tough to tell. This is a massive, existential risk, but also one that’s nearly impossible to plan for. And yet, you can see shades of a risk management strategy already at play. Could the movies die in the United States, but survive overseas? Sure. Involve Jackie Chan in the ceremony, and present a montage of Chinese movie fans. Could VR become the dominant motion picture presentation format? I don’t think so, but just in case, start nominating VR pieces for animated short film.

Could civilization collapse, and along with it, the electrical grid to make and present motion pictures of any sort?

In that case, I suppose Oscar statuettes can be used as melee weapons.

Something Else Altogether

What else could go wrong? We’re only scratching the surface here! Readers: tap into your fertile imaginations and offer up both your dire Oscar risks and Oscar mitigation strategies in the comments below.

4 Comments on “How to Break the Oscars: Risk Management at the Academy Awards”

  1. clayschuldt #

    A weather based incident causes a delay. What if a rare storm hits LA right as the red carpet walk starts. The whole red carpet pre-show won’t work and a bunch of actors were had rain drenched outfits. If the storm is bad enough power could go out in the theater. Do they have a backup generator and flashlights?

    Or, what about an earthquake? Do they have emergency escape routes? They probably do.

    Reply

  2. Mark Lee OTI Staff #

    Huh. Apparently this year the red carpet area was covered by a tent this year due to rain in the forecast. So they do have a plan for that.

    http://variety.com/2017/film/news/oscars-2017-academy-awards-red-carpet-1201996678/

    Earthquakes: I think the risk management strategy there is basically outsourced to the government (sets the building code) and the venue (presumably adheres to the code, creates an evacuation plan for its building). Ultimately, you can’t fully manage risk for a natural disaster of large enough proportion. If it happens and the whole damn thing is canceled, presumably there’s an insurance policy that will make a payout, and/or you postpone until you can hold there ceremony without the bad optics of throwing a party in a disaster area. (See also: canceling the NYC Marathon after Hurricane Sandy.)

    Reply

    • clayschuldt #

      Wow! I total missed the tent over the red carpet. It is a really simple solution though.

      The only other risk I can think of for the Oscars is if another live event, like major breaking news, interrupts the telecast. Would they stop the ceremony and wait or continue on and do a video delayed Oscars?

      Reply

  3. Monzenn Mallari #

    Since we’re talking about risk management, I wonder if there can exist a market for catastrophic awards ceremonies, just like a market for disaster insurance (and reinsurance) already exists. We know that insurance for not completing a movie already exists, so why not botched awards as well? (Call it the Harvey-Beatty market, maybe.)

    Reply

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