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Managing the Unpredictable: A Crisis Communications Case Study

Oliver S SchmidtBy Oliver S. Schmidt, Managing Partner, C4CS

The first warning was an email from a regional sales rep alerting management at headquarters that a reporter from a TV station in another state had visited a customer facility where the company’s equipment was in use. The reporter, the sales representative warned, had asked about rumors of a product malfunction that allegedly resulted in a near-fatal incident.

So began an adventure in crisis and reputation management that, within weeks, would impact the manufacturer across North America. While professional prudence dictates that we not identify the company, the real-life story serves as a reminder of how important it is to be prepared for the worst.

To be sure, virtually any organization could face a crisis at just about any time. A truck could overturn, spilling toxic material. A product could be found to be defective, resulting in a recall effort. Faulty software could cause financial havoc. A fire, perhaps resulting from a natural disaster, could destroy a plant or distribution center. An executive could get caught embezzling. An employee could go berserk. The list is indeed endless.

In the case of our client, management had the smarts to recognize the potential seriousness of its challenge. There was no thought of ignoring the sales representative’s warning, nor, when it came time to answer queries from the media, of stonewalling behind a curtain of “no comment.”

Management’s first step was to form a crisis response team of key executives so that the impacted functional areas within the company—Sales, R&D, Marketing, Legal, Corporate Communication, and others—could act in lockstep. The crisis response team, in turn, quickly set about to investigate what prompted the reporter’s interest and to gauge just how pervasive the alleged product issue might be. Dispassionately dealing with unvarnished facts, no matter how unpleasant, is always crucial to preventing a bad situation from snowballing into a devastating one.

The company also sought assistance from a firm with particular expertise in strategic communication and crisis management. As such, we helped management prepare for various scenarios that might unfold, with an eye to reaching and influencing all of the company’s stakeholders – customers, employees, general and trade media, professional groups, and others – with consistent and targeted messaging.

Within hours of being asked to help, we conducted a situational assessment, assisted in determining business and communication objectives, and performed an audit of internal and external communications channels and tools.

Many questions had to be answered. Who manages the company Web site and how rapidly could new content be added—even at midnight? Where and how is customer data stored and how readily could we generate a list of customers who might also be impacted? How effective is e-mail for reaching specific stakeholders? Which key customer accounts needed additional attention? Who controlled the company’s social media presence? Was automated Internet and media monitoring already in place? Had members of the sales team been approached by concerned customers or media representatives? Who had been designated as official spokespersons and what additional training did these managers need prior to answering questions from reporters? How do we streamline the approvals process?

With our assistance, the client proactively contacted the TV reporter, asking her for the opportunity to be a part of her reporting. While she and her newsroom editors were gracious and professional, it was clear that the station thought it had a riveting story that would keep viewers intrigued. They did not divulge many details about the story they were pursuing. Television news, after all, has to be dramatic to compel an audience to stick around.

Nor would the station say precisely when it expected to air the story, but promised to let us know beforehand. As it turned out, they did not keep their promise.

Separately, we found out that the TV reporter had contacted customers in other cities across North America. Even before any story was broadcast, industry buzz was spreading.

We knew we could not just wait to see how negative the TV station’s news report might be. We hence developed multiple crisis scenarios and a step-by-step game plan to guide us, both in the immediate aftermath of a damaging news report and over the longer haul. We prepared a strong first draft of a rebuttal news release, along with a CEO letter. We designed and generated special pages on the company Web site to be our platform for all subsequent communications. These pages functioned as a “Dark Site” that did not go live until the news report had aired. And working with a local video house, we wrote, taped, and edited a video presentation for our “Dark Site,” featuring a line manager with day-to-day safety responsibilities, to personalize the company’s commitment to product integrity and its culture of openness and transparency.

When the TV story aired a few days later, we were prepared. The dedicated Web content went live. The news release and the CEO letter went out. An e-mail blast was commenced. Personal calls were made to key accounts. Trade media and industry leaders were contacted. Employees were kept informed and provided important input.

In the days and weeks that followed, we conducted extensive message development and provided media training specifically geared toward preparing designated spokespersons for taped TV interview opportunities and a news conference that included a product demonstration for reporters in a focus market. We regularly communicated with the sales force and other key employees and added to the content on the Web site, including a technical briefing document and a summary of government research favorable to our side of the story. In an effort to provide total transparency, we later also included links to various TV and print reports that had by then appeared in markets across North America and alerted stakeholders to favorable findings published by regulatory authorities.

Was it overkill? Not at all. Because, as we all know, in this age of Google and ubiquitous online connectivity via social media, a TV report broadcast in a single market could go viral and be seen by any number of stakeholders within minutes. And we also know that a damaging accusation, even a false one, can take on its own life if not countered urgently.

Although the story spread to other cities, in most cases our stakeholder messages were included, and a number of TV and newspaper reports featured content from our specially prepared Web pages. While we did not kill the story outright—that is often an unrealistic, and sometimes counterproductive, expectation on the part of management—we did succeed in making sure that the client’s stakeholders knew immediately that the company would not be passive in defending itself.

Indeed, that realization by stakeholders has probably had life-or-death consequences for the company. As part of our follow up, we worked with our client on attitudinal research. To paraphrase a common response from a senior manager at one of our client’s customers, “When we first learned about this, I was worried. But then I saw how forceful and fast you were in getting on top of this, and that gave us the confidence to stick with you.”

Several months later, a report that resulted from an investigation conducted by regulatory authorities clearly stated that our client was at no fault. That news was picked up by traditional as well as social media across the board, and the client saw its name recognition shoot up as a result.

The bottom line: Bad things can happen to good companies. Management therefore must expect the unpredictable and prepare accordingly.

Lessons Learned: A Checklist

A crisis or disaster can hit virtually any company, any time. If one were to strike yours today, would you be prepared? Review this checklist to assess your company’s crisis communication readiness. And if you find yourself not adequately prepared, don’t get scared. Instead, put the following in place well before a crisis hits:

  1. Crisis Definition
  2. Crisis Response Triggers
  3. Crisis Communication Readiness Assessment
  4. Crisis Notification Procedures & Tools
  5. Crisis Scenario Development
  6. Crisis Communication Plan (including Social Media Component)
  7. Crisis Control Centers & Media Briefing Locations
  8. Crisis Response Teams (local, regional, national, HQ)
  9. Crisis Response & Media Contact Logs
  10. Designated Primary & Backup Spokespersons
  11. Media Policies (social and traditional media) & One-Voice Policy
  12. Internet & Media Monitoring (social & traditional media)
  13. Tested Crisis Communication Channels & Tools
  14. Recurring On-Camera Media Training
  15. Recurring Scenario-Based Crisis Communication Training

Oliver S. Schmidt is the managing partner of C4CS, LLC (www.c4cs.com) with offices in Pittsburgh, Pennsylvania, Charlotte, North Carolina, and Berlin, Germany. C4CS specializes in strategic communication and crisis management precisely tuned to protect and enhance brand equity, reputation, and the bottom line. You can reach Oliver at schmidt@c4cs.com. Additional resources for crisis preparedness planning are available on the firm’s Web site and via its “Communication Command” enewsletter.

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