Crisis Management 101
11 December 2018
Marketing Strategy Column
December, the most intense time of the year for most. It’s a race to tie up annual budgets, finalize large transactions and most importantly plan ahead for the months to come. Which means it’s the perfect time to exercise crisis management. Between natural disasters, personal data theft, sexual or psychological harassment accusations, and operational mistakes, to name a few unexpected incidents that can affect a company’s equilibrium. So, how do you navigate the waters of a crisis? The solution can be summed up into three simple elements.
1- The best insurance is having a plan
Developing a crisis plan is usually the last thing a company does. Why? Because they never think it’ll happen to them. However, the best way to maintain a company’s operations, protect its sales, and reputation is to anticipate every consequence a particular crisis can bring forth before even it happens.
To avoid being blindsided, it’s imperative that you reflect on your plan of action, including even the most uncommon scenarios. You must decide the first person to be notified, and who will be the official spokesperson. In addition to preparing a summary of information to share, you have to put into place principles of transparency to ensure that your teams can quickly be informed of the events, and know what is expected of them. Taking the time to reflect when the climate is more favourable allows you see every flaw and plan for ways to save your reputation.
In 2014, UPS and Fedex discovered that the lack of planning can quickly take a disastrous turn. Crumbling under an explosion of online orders, the two shipping industry leaders disappointed a number of clients who waited significantly longer for their orders. Instead of owning up to their mistake, and working with retailers to satisfy their clients, they blamed the weather, last minute orders, and their distribution system limitations. More than likely their legal counsel advised them not to take responsibility to avoid any lawsuits. But in the meantime, both organizations were being perceived as the companies who couldn’t deliver—literally—the merchandise, which made their stock plummet in the market.
When UPS and Fedex failed at the task at hand in 2014, Amazon stepped in. To compensate for the delays, they offered a $20 gift card to the clients who had been affected. People tend to forgive and forget more easily when the company is transparent and makes amends right away.
Talk about a great way to be proactive when a partner or competitor is in hot water. Are you ready to pounce?
2- If you admit your mistake, you’re almost forgiven
If a crisis presents itself, don’t wait to admit the mess you’re in. Because, the longer you wait, the more the media coverage will increase, and the higher the chances that social media will blow up. Quickly gather the facts, take your courage in both hands, and make decisions on how to rectify the situation. The important thing is to respect company values, and to deliver, as soon as possible, an empathetic response that will save your reputation.
JCPenney has a really good example of a quick response during the Hitler tea kettle debacle in 2013. When a blog post pointing out that their kettles looked a lot like Adolf Hitler went viral, the team at JCPenney quickly responded. They said that it was totally unintentional, and that if they had designed it to look like something, they would have gone with a snowman or something fun. An apology and being able to laugh at yourself often allows you to score points.
3- Stand behind your values
The role of a director is to ensure to lead a company in the healthiest way possible. To avoid any kind of crises, it’s recommended to establish, from the time a company is launched, ethical principles that are in line with the company values and mission. Communicate with your teams the actions expected from them, and have the courage to demand respect for the principles you are defending. It’s really the best way to protect yourself from a potential crisis.
The end of the year is the perfect moment to verify that core values are respected by operations and that the culture doesn’t encourage problematic behaviours. It’s also a good time to help the teams connect with the mission of the organization, to put values and the code of conduct at the forefront, and underline related actions to take.
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