Effective First Steps to Counter a Crisis

Companies face crises all the time – product recalls, plant closings, a company leader making a poor personal decision. It’s how you react once the crisis begins that affects whether your company will survive.

Suddenly it seems that each day we learn of a new accounting scandal leaving a major corporation in crisis and the futures of shareholders and employees uncertain. While this may be a new wrinkle in the U.S.’s corporate legacy, companies in crisis are nothing new. As we have seen time and again, from Tylenol to Exxon to Firestone to Enron, how you act and react once a crisis begins often forms your company’s future.

Companies face crises all the time – product recalls, plant closings, tainted products, a crime committed by an employee, a branded item found at a crime scene, a company leader making a poor personal decision. The fact that we only hear select stories of this kind in the news and at the water cooler illustrates the power of effective crisis communications.

Following are six steps toward a positive crisis resolution.

Preparation is key.
Consider a crisis plan an insurance policy for your corporate image. With such a plan in place, or at least a cursory examination of potential scenarios, if a crisis hits, you can spend crucial time implementing the plan rather than trying to figure out where to start. Preparedness can include developing a detailed crisis strategy, creating media materials in advance, arranging media training for key executives and pre-establishing a crisis team.

Make sure you have all the facts.
Gather as much information about the situation as quickly as possible and from a variety of sources. Then talk with your legal counsel and your communications counsel to see what information can be released and what should remain confidential. You will need to share crucial information while ensuring that you do not jeopardize your corporate image. Continually talk through the situation with your trusted counsel. Stay in constant contact with your senior management or crisis team.

Take immediate action to minimize danger to human life.
If any lives are in jeopardy, be sure to immediately address those grave concerns. Negligence with human life is unforgivable.

Tell the truth.
Be sure that any information you release to the media or the public is truthful. If something you say is false, your credibility will be irreparably damaged. If the information you have is potentially damaging to you or your company, and no one has specifically asked about it (or it has not yet been made public), you do not need to divulge it, at least not immediately. It is not necessary to throw fuel on the fire. If, however, the information is in the public domain, you must immediately react with a truthful response. If you do not know the answer, say that you do not know and that you will try to get the information being requested.

Show you care and be sincere.
Do your best to understand what the public’s concerns will be and address those concerns directly.

Linda Lay, the wife of former Enron chairman Kenneth Lay, likely created more harm than good when she tearfully said on the nationally televised Today Show, “We are fighting for liquidity. We don’t want to go bankrupt.” The American public felt her comments showed a lack of sincerity and an acute lack of sympathy for the many Enron workers whose life savings had just been wiped out. Be sympathetic to those affected by the issue at hand.

Never overlook the power of common sense.
Think through the different crisis resolution scenarios. If your gut instinct is that they are off the mark, get more information and keep thinking. Trust yourself and your closest advisors.

While no one can predict a crisis, appropriate foresight and thought can mean the difference between maintaining a stellar corporate reputation and the dreadful alternative.

Abbe Ruttenberg Serphos is president of ABR Communications Ltd., a full-service public relations firm in New York City. With over 12 years experience, she has been involved in crisis counsel for many high-profile brands and clients.

Abbe Ruttenberg Serphos
ABR Communications Ltd.

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