Critical Factors for Successful Crisis Management
In 1982 Johnson & Johnson faced a potentially crippling disaster when bottles of its powerhouse brand Tylenol were tampered with resulting in several deaths. Faced with a crisis of unprecedented scale, the company’s chairman James Burke successfully addressed the situation, effectively managed the response and lead the company back from the brink to become stronger and better respected than it had ever been before. More than 30 years later Volkswagen is now expected to suffer losses of up to $30 billion as a result of badly mismanaged and misguided attempts to cover up and then deal with the fallout over its own devastating crisis.
What separates these two examples are, on the one hand, the leadership and crisis management skills put into play and how effective the correct response can be, and on the other hand how devastating missteps can become in the wake of a company crisis. When dealing with a potentially disastrous event, be it a public relations meltdown, scandal or public health concern, taking the appropriate steps can help you and your business navigate the danger and find the light at the end of the tunnel, for the largest companies down to the smallest operations. As they say, all politics, and business, is local.
Design a Plan, Designate a Spokesperson and Take Action
Knowing beforehand how you will respond to any given crisis beats trying to come up with a plan on the spot every time. The manner in which you respond speaks as loudly as the results do. Prioritizing the protection of people, both employees and the public, over the protection of your products, property or public image shows observers and potential customers where your company’s values lie.
Creating and maintaining a consistent message and communicating that message to the public are paramount as well. A designated spokesperson helps hone a message and develops a sense of continuity and forward progress while mitigating the impression of chaos and disarray that does irreparable damage to your brand.
Prioritize Honesty and Open the Lines of Communication
One of the most costly mistakes when confronting a crisis is when people – the public, your customer, your suppliers – find out about it through the media. Getting out ahead of a potential public relations disaster and launching a campaign of open communication will diffuse a media frenzy in the making. Scrambling to cover up a problem or keeping quiet while you frantically try and deal with the situation behind closed doors leaves plenty of time for negative press to fester. Taking charge publically dispels rumors.
Internal communications must be well oiled on top of all of this. Consistency in messaging isn’t limited to your company’s relationship with the public or your target audience, but serves you equally as well inside your organization. When everyone is on the same page you’ll progress from chapter to chapter far more smoothly. Visible and public action is essential. The company that fiddles as their Rome burns will end up smoldering in the ash as well.
Update Early and Update Often
Transparency trumps all. Let your stakeholders know what is happening and what you and your outfit are doing about it. One key point here is all marketing needs to stop. There is no stickier egg on your face than trying to assuage fears with one hand while still trying to sell your product or service with the other. As mentioned earlier, in the wake of whatever disruption or crisis your organization is coping with, silence invites conjecture and more often than not that conjecture will only do more damage to your company and the situation overall. Over communication may feel like you’re exposing yourself too much, but it’s far better to keep the lines open and visible, helping to tamp down any runaway speculation and rumor. Be ready to engage across the board lest your customers and the public at large accuse you of having selective hearing.
Lastly, although the marketing push should be halted, don’t neglect your social media presence. These platforms are still generally the most visible parts of your company and should reflect and present everything that is going on behind the scenes in real time.
Be a Company of the People
At the end of the day, your customers and the public should be your top priority over anything else. Johnson & Johnson’s recall of every bottle of Tylenol across the nation at a then staggering $100 million immediately made clear where their concerns lay. With a market share of 37% before the crisis, Tylenol had bounced back to 30% from a low of 7% within two years of the ordeal. Having a crisis action plan before the moment arrives is essential. Building strong relationships before and after a business disaster will strengthen you and your organization across the board.
Weathering the storm successfully isn’t a matter of chance. Put yourself in the position to withstand a crisis that, in the increasingly visible and shifting business and commercial environment of today, is becoming a question of when, not if.
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