Crisis situations are not only about big business. Unexpected problems can overtake not only a huge corporation, but also your favorite coffee shop.
It is important to be conscious and prepared for economic or social crises that are inevitable in business life. And here you will find why there is no need to be afraid of crises and how to react to them correctly.
What is crisis management
A communications crisis is an event that provokes negative coverage of a brand (company or personal) in the media or a number of other communication channels. That is, a crisis is an initially negative process.
Crisis management (or crisis communications) is a set of measures aimed at reducing reputational damage. This is a lot like putting out a fire. As in the case of a real flame, the task of a crisis manager is to quickly identify the source of the “fire” and throw all his energies into liquidation. Otherwise, the brand may burn to the ground.
There is no one-size-fits-all solution to corporate crises. But you can learn something from well-known cases.
Examples of crisis management
Johnson & Johnson – Poisoned Tylenol
What Happened: Seven people have died after taking the super-potent antipyretic capsules. The investigation ruled that potassium cyanide, a deadly poison, was added to the packages.
What the company did: Johnson & Johnson acted immediately. The company first issued a public statement accepting the blame and expressing condolences to the families of the victims. She then quickly removed 31 million packages of Tylenol worth $ 100 million from the shelves and ceased production and advertising of the product.
The company also contacted Chicago police, the FBI and the Food and Drug Administration (FDA) to find the poisoner. Johnson & Johnson even offered a $ 100,000 reward for any information about the culprit.Result: The media highly appreciated the efforts of J & J and its concern for the public interest. In the post-crisis period, the company reintroduced Tylenol with tamper-resistant packaging and $ 2.50 discount coupons. The Chicago Poisoner was never found.
British Airways – user data leak
What happened: Data from about 500,000 British Airways customers went public in the fall of 2018. Fraudsters gained access to passports, addresses and credit card details. Government regulators issued a fine of almost $ 200 million to the company.
What the company did: British Airways pleaded guilty to the data breach. The company has also begun negotiations with affected customers for damages and moral compensation. Such determination preserved the company’s reputation and saved it from even greater financial losses.
Result: The company has maintained its reputation, although it will have to pay a fine. However, the amount could have been much higher if British Airways had not taken urgent action.
Uber – lack of action and transparency
What Happened: In early 2017, it became known that CEO Travis Kalanick was on President Trump’s advisory board. This is how the hashtag #DeleteUber appeared. In late January, Kalanick announced his resignation from Trump’s advisory board due to criticism.
Another scandal soon erupted . On February 2, the New York City Taxi Association announced a general strike at John F. Kennedy Airport. The reason for this was Donald Trump’s immigration policy. But the Uber drivers kept on working. This caused another wave of indignation.
In late February, former Uber employee Susan Fowler Righetti accused one of the company’s managers of sexual harassment. Subsequently, other cases were revealed. Travis Kalanick promised to immediately launch an internal investigation. But investors and the public did not believe in his impartiality. The company did not conduct an investigation with outside experts.
A few weeks later, a video appeared where Kalanick rudely discusses the pay cut with the driver. The entrepreneur published a statement where he asked for forgiveness and stated that “he must become better and develop.” But the video went viral anyway.
What the company did: They only issued small textual statements on each of the cases. The main mistake Uber made was the lack of transparency and at least some desire to emphasize words with actions.
Rescue Operation: Crisis Checklist
Prepare in advance
Special prevention practices include :
- understanding your key stakeholders;
- creation of an anti-crisis management plan and its updating at least once a year;
- conducting exercises to test the plan and the crisis management team at least once a year;
- drawing up templates for statements during the crisis.
Keep calm
Lack of panic and readiness for urgent action is the key to success. Let’s take a look at what needs to be done immediately after the onset of the crisis:
Throw away your panic and calm down. You won’t be able to go back in time, and wasting time on emotions
is definitely not the best option.
Form a team that will deal with the problem. Clearly define the tasks of each member of the “rescue squad”.
Identify the source of the crisis and try to eliminate it.
Make a statement and admit guilt. At the same time, in no case should you lie or hide anything.
Prioritize
Don’t try to fix everything at once. It is much more important to prioritize correctly . Their list might look like this:
- Saving lives and preventing serious injury.
- Minimizing damage to the environment, property and assets.
- Brand reputation protection.
- Business continuity, return to business as usual.
The order of the items may vary depending on the situation. But saving lives and health should always be a priority.
Truth and only truth
The preparatory stage for combating the crisis has been passed. It is even better if it is completed quickly and followed by the main part – communications.
It all starts with an informative statement and needs to be made as quickly as possible. If your company is to blame for the crisis and because of your actions people have suffered – you need to admit it and take the blame.
What you should include in the application:
- basic information about the crisis that has occurred;
- an action plan to resolve the problem immediately;
- a victim assistance plan with instructions on how to get it;
- apologies.
The official “paper” statement should be followed by a live performance in front of the media. This is one of the most important points in crisis management.
Here are some tips on how to do it best:
Define the “voice” of your company. It doesn’t have to be just one speaker. The main thing is that the company’s rhetoric should be directed in one direction and that the speeches do not contradict each other.
Avoid the phrase “no comment” or any similar evasion of questions. People may think that the organization is trying to hide something.
Present information clearly and avoid jargon and technical terms. Lack of clarity raises the suspicion that the company is deliberately misleading.
Clear eye contact is needed. Also, avoid distracting nervous gestures.
Inform the target audience about the latest crisis information and key messages that the organization is trying to convey to stakeholders.
Websites, social media and mass notification systems complement media coverage and help spread information quickly. So do not neglect different communication channels, but be consistent everywhere.
Actions, not just words
Remember that it is important to support words with action. Listen to what people want and always try to satisfy as many requests as possible. It is not scary to spend a lot of resources on this – it is more important to restore your reputation in the eyes of the public.
Draw conclusions
When the crisis subsides, it is necessary to extract lessons from it. Here are a few key points to break down:
Reasons for the emergence of the crisis. At what stage and in which chain of the company’s existence there was a mistake that triggered a crisis situation.
Search and punishment of those responsible. It is important to conduct an independent investigation, which also needs to be covered in the media. A fair system of sanctions will help avoid mistakes in the future.
Crisis management problems. Analyze your mistakes and shortcomings, make an action plan in case of the next crisis.
Conclusion
In order to stay calm and manage eveything in a perfect manner, neither you should have experienced or top level managers or you should integrate your operations into a perfect management system. Systems like Servista can provide full control to a business by a perfect measures with the help of high technology.
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