Lambs to the slaughter. Moths to the flame. CEO’s, key executives, millions of employees, legions of shareholders and thousands of going concerns are falling victim to self-inflicted wounds created by flawed crisis communication strategies. There are several forms of business crises... legal, ethical and operational crises most visible. Legal crises are prominent today spurred on by Enron and the fallout from Wall Street scandals. Ethical crises in business are becoming more common ranging from off-shoring jobs, to third world labor exploitation, to media conglomerates broadcasting questionable content, to 8-figure cost-cutting CEO’s. Operational crises are created by product recalls, executive defections, cash flow shortages, disruption in production capacity, loss of a major customer, etc. And importantly, publicly-traded enterprises have a much greater reporting burden that requires them to respond differently to a crisis than a privately-held enterprise.
Back in the day, businesses were left to resolve their crises in private - away from the public glare. How things have changed. Today, dealing with negative news resulting from a crisis is fraught with hazards created by the complexities and vagaries of the 21st century. Many of the crises today involve potential criminal violations and require the introduction of enterprise outsiders to investigate and report on wrongdoings. Over the years a set of rules have evolved - put forth by the public relations community - describing how you should deal with negative news. This body of thought collectively referred to as crisis communications can be summarized by the following points:
1. Disclose everything you know as soon as you know it.
2. Conduct a thorough and transparent third-party investigation.
3. Apologize and make restitution.
4. Punish the offenders.
At face value the above rules seem right. And in a perfect world make sense. But in today’s increasingly hostile environment these rules have become a recipe for disaster. Enterprises under pressure to respond to a negative event will find itself out-of-control and at the mercy of outside forces if they follow these rules. Here’s why:
First, understand that the primary driver of these rules is the media. Many PR practitioners are ex-journalists who trade on their media contacts. While most PR professionals are really good at opening doors and getting stories printed, they are absolutely awful at developing the right response in the eye of the storm. Instead of crafting a response that supports the enterprise they craft a response that they think the press wants to hear. The interests of the media on the front end of a crisis are at directs odds with the interests of the
enterprise.
Second, most PR professionals advocate for the media... in other words they place the needs of their media contacts above your needs as the client or employer. You are a transient opportunity for the PR professional... their media contacts are not. This results in the PR industry having a vested interest in how much and how fast information is released - everyone has heard the old adage that any press is good press. Anybody who’s been though a PR agency pitch gets hammered with three ring binders full of articles and mentions generated by the agency. The irony is that really great PR works as hard to keep you OFF of the pages of the Wall Street Journal as it does to get you on. Let me repeat this...
REALLY GREAT PR WORKS AS HARD KEEPING YOU OFF OF THE FRONT PAGES OF THE WALL STREET JOURNAL AS IT DOES TO GET YOU ON.
Third, the rush to disclose everything, as soon as it is known, opens the enterprise to all sorts of immediate threats and long term vulnerabilities. In the midst of a crisis there is always an abundance of rumors, confusion, misinformation and bad advice. Quite often the information released in the opening days of a crisis will be wrong. And require wholesale revisions or retractions. Traditional PR doctrine advocates that if you do not respond immediately then the press will accuse you of trying to hide something - and brand you as guilty, or as being non-responsive and out-of-control. As a crisis develops you see PR professionals hustling ill-prepared CEO’s in front of the camera’s and hungry reporters who then use the CEO’s image and words to shape the story according to their agenda.
Fourth, inviting independent third-parties to conduct a transparent investigation lays bare and exposes to everyone the weaknesses and vulnerabilities of the enterprise. Outsiders to the firm do not have the frame of reference or proper context to conduct a meaningful investigation. Most investigations today are publicity stunts designed to appease the media. The best investigations are conducted privately, by insiders with an intimate knowledge of the issues and the players. This assumes that the purpose of the investigation is to correct a deficiency or solve a problem. Capitalism is predicated on competition. And while your enterprise is undergoing a very public investigation your competition will be using this as an opportunity to take share.
Fifth, one of the most effective weapons used against the enterprise today is the CEO apology. The apology becomes a blunt instrument used by critics to bludgeon the CEO and the enterprise. If an apology is truly warranted - and not just another publicity stunt, then it needs to be made privately and humbly to the affected parties by the offending parties. The public CEO apology is almost always followed by punishing those implicated. The punishment is generally termination. Ironically, the people who are terminated are exactly the ones in a position to learn from the crises and avoid them in the future.
And last, a class of critics has evolved over the 20th century consisting of reporters, journalists, writers, analysts, bureaucrats, regulators, politicians, consultants and attorneys. All willing to convert your crisis to their advantage. This class consists of a group collectively referred to as THEY. As when someone supposedly is offering advice along the lines of... you can’t do that - THEY won’t let you. If you manage your crisis on the basis of trying to cater to the critics, then you will fail.
So how do you survive when faced with a significant crisis in an increasingly hostile environment? To answer this question you first need to acknowledge reality. This is what I mean. When confronted with a crisis whether guilty or not, enterprises have been trained to think that if they do certain things - follow the rules - then you can reclaim your reputation or lost opportunity. This is wrong. To illustrate why, simply look at how the media deals with a crisis. When the crisis begins it gets front page attention. When it is later determined that you did nothing wrong or the crisis has been resolved you get little coverage if any. The hard reality is that you inherit the perception created by the crisis.
The other reality that needs to be confronted is the effectiveness of taking the high road. As a crisis unfolds you quite often hear people saying - we need to take the high road. The low road typifies the fray, the dusty, muddy fray created by a fight. The high road is the civilized road, it’s above the fray. The problem is that when your critics are taking the low road you have no other choice but to get down their with them and fight. This assumes that you are fighting over something of value and you have the will to fight.
Here are new rules for 21st century crisis communications:
1. Accept the new reality. What ever created the crisis also creates a new reality. Rather than trying to deny it or change it, accept the new perception as your new reality.
2. Adopt a survival posture. Based upon the new reality, determine if the enterprise has the will to survive. This includes leadership and the rank and file.
3. Control the flow of information. Do not disclose anything to anybody until you have a full grasp of all of the details of the crisis. Then disclose on a highly selected, need to know basis only.
4. Control the communication outlets. Use only those outlets you control to communicate to the public. Web sites, press releases, commercials, advertisements are examples of outlets you control.
5. Engage the critics. Use your communication outlets to engage your critics. Take the low road and fight the analysts, reporters, politicians etc. This is the first step in shaping the environment to your advantage.
6. Determine and remedy the problems. Determine what created the crisis. Then fix it.
7. Fight your way back. Be prepared to get down in the mud. If you’re not willing to get muddy, to get dirty, then your critics will win.
Subscribe ARMORY | Book MOBILIZATION | Engage CAMPAIGN
Comments