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Article
Dealing With
Crisis
Copyright ©
All rights reserved
By Ken Chapman, Ph.D.
Ken Chapman & Associates, Inc.
You keep your books carefully and
treat your customers like royalty. You spend conservatively and observe
safety procedures to the letter. That is what responsible leaders do.
Unfortunately, it does not inoculate your company against an unexpected
crisis. Even the best managed companies face serious, unforeseen problems that
can threaten their survival. How you respond may be more critical than the
crisis itself. Types of crises vary widely. They may involve a sudden
financial problem, an environmental accident, a defect in a key product or
service, injuries to employees or the public, or a natural disaster. Each
crisis is unique, requiring special tactics. Still, crisis management experts
say certain guidelines should govern just about any situation you may face.
How Serious is Serious
The first challenge is to determine
whether the situation at hand is truly a crisis. This may sound simplistic,
but when emotions heat up, it can be tough to tell a temporary blip from a
catastrophe in the making. I would define a crisis as: “Anything that affects
the short or long-term survival of a business or affects the reputation of the
brand.” Ask yourself this, “Can I imagine this putting us out of business or
trashing our hard-earned reputation?” If the answer is “yes,” you have a
potential crisis. Or try the media test. Will reporters take an interest in
this problem? Hint: Anything involving children, public safety, or the
environment has crisis written all over it.
Delays Spell Trouble
Once you have determined that you
have a genuine crisis, understand that everything you do in response will be
judged from the first moment. When the crisis becomes public knowledge, the
first actions will be the ones most closely examined by regulators, customers,
the media, and the public. The biggest mistake, across the board, is denial.
This is true for big companies and small companies. You have to face the fact
that undue delays simply make you look guilty. The second most common mistake
is analysis paralysis. This is a term that describes managers who over
analyze the situation instead of acting.
First Things First
Obviously, the immediate objective
in any crisis is to stem the problem itself during the acute phase. If there
are injuries, see that everyone is cared for. If it is a product defect, see
that the faulty product is cleared from shelves or retrieved from customers.
The next step is to begin letting people know as quickly and as openly as
possible what is going on. Those affected by the crisis will appreciate
forthrightness and resent anything they take as an evasion. You will want to
share everything you know with government authorities and those affected.
Keep other customers and your staff fully informed as well. Keep the message
simple, direct, and honest. What went wrong and what you are doing to
remediate it is what everyone is most interested in knowing.
The Press
Dealing with reporters can be
particularly daunting for small business owners who are not always accustomed
to interviews, [especially confrontational ones.] and for thoses owners who
may not have in-house public relations staff. Publicity at a time like this
is painful, but efforts to avoid or mislead reporters, or to intentionally
minimize the scope of the crisis, will only backfire.
There is no law saying you have to
speak with reporters. Your lawyers may advise you to hold certain sensitive
information from the media for legal or privacy reasons. But keep in mind
that reporters will aggressively pursue anything they sense is a big story.
They will be trying to interview your customers, your employees, and everybody
else. So the less you say, the less control you have over the story.
Be as open as you can and absolutely
honest. If you do not know the answer to a question, say so. If it is
privileged information, explain exactly why you cannot answer. But make sure
it is truly privileged and not simply embarrassing or painful.
The Silver Lining
It is not all bad news. While no
company enjoys a crisis, the result does not have to be entirely negative.
Even if your company is clearly at fault, people are very forgiving of honest
mistakes. Admit the error and conscientiously make amends, and you may even
enhance your reputation.
Here are some other ideas and
suggestions: Think before you act. Responding quickly is not the same thing
as being rash or giving in to panic. When you first see a crisis breaking,
take a few moments to collect your thoughts.
Take care of regular business. Do
not get so caught up in the problem at hand that you neglect your daily
business responsibilities. To do so, may compound your troubles with the loss
of valued customers when you can least afford to lose them. Always remember,
it is much less expensive to retain a customer than to create a customer.
Finally, have a plan. While there is no predicting when a
crisis will happen, you can protect yourself by having a detailed plan should
one occur. Think about potential problems. For some companies, the potential
crisis may be obvious. Other business owners may have to think a little
harder about what could possibly go wrong. Involve your key staff in the
planning and make sure they understand that even the best run businesses can
face difficult crises. Help them to understand how they should respond; and,
if the time comes when your company does, in fact, face a crisis; everyone
will be more comfortable dealing with it.
For more information
about Ken Chapman and Associates’ Leadership Development Programs, contact Ken
Chapman at 205.366.0265 or email Ken at
kchapman@leaderscode.com.
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