Crisis communication is among the most difficult tasks within public relations. The economic success of a business is closely linked with its public reputation. In this day and age, what once took days to deliver to stakeholders of an organization can now, thanks to technological and media progress, be delivered within minutes. Successful crisis management is today, as it has always been, a necessary protective measure for any company in order to reduce potential damage.
A crisis is defined as a significant threat to the activities of an organization that, if not handled properly, can lead to negative consequences. In crisis management, the threat of the potential damages that lie ahead for the organization itself is defined by stakeholders and the industry. Both can have an impact on public safety, as well as lead to financial loss and/or reputation degradation. In addition to errors made by the business itself, companies are often brought into the center of a discussion or used as a scapegoat for unrelated issues across all industry sectors.
Although the duration of a crisis is often said to be two to four days, this assumption is not significant. On one hand, there are crises that are reoccurring and persistent. By far the biggest scandal ever to engulf the car industry came in September 2015, when carmaker Volkswagen admitted it had deployed illegal software in its Volkswagen and Audi brand diesel cars to cheat emission tests. “Dieselgate” is an example of a recurring and ongoing crisis that is still far from over. On the other hand, British Airways speedily enacted a successful crisis communications plan, taking responsibility, apologizing and informing all customers who were affected, when it lost customer data and credit card details for thousands of customers. Though aftershock of such a crisis will remain, the public debate significantly decreases. Here, the indication of a specific duration applies when only the outbreak period is considered. Sustainable coping will aid in dealing with the company in the future.
Regardless of the severity of a crisis, any business can fall into such a situation. It is important to be clear about the fact that there is no way to wake control of the situation. Media are obliged to uncover abuses and wrongful developments and subsequently report on them. Through the medium’s active position, organizations are pressured into a passive role which they have to disengage themselves from. Whether or not the company has contributed to the negative message in question is, initially, completely irrelevant. The company gets thrown into a public relations crisis and, subsequently, into the public’s prisoner’s box.
Understanding the pattern of a crisis can help a business better prepare and appropriately respond. A successful crisis communication program must adapt to meet the three phases of any crisis:
The prevention phase is the basic building block for successful crisis management. In the first step all possible risks are identified that have the potential to trigger a crisis. Then, a plan is developed and the members of the crisis unit are selected. The plan does not provide a step-by-step guide, but rather serves as a guide in addressing issues, including basic processes, relevant contact information and a list of available tools. The contingency plan should be reviewed at least annually.
The crisis management team should be composed of members from each of the company’s major departments. In addition to the PR department, representatives from the legal and financial areas are of great importance, as well as those responsible for management of personnel, because a crisis is reflected in all areas and must be dealt with on all levels. Members of this staff should be aware of their duties and responsibilities in the event of a crisis. Regular exercise ensures a minimum level of routine and automatism.
Those who may need to serve as company spokespeople play a key role in the exercise scenario. This function does not have to be handled by one person alone. Depending on the affected area, someone with expertise is more beneficial and authentic than a simply public relations representative. Eye contact should always be maintained, answers should never conflict with company statements, and the phrase, “no comment,” should be avoided.
To further prepare for crises, material should also be created to handle press releases and statements. Again, it is not a question of having finished reports, but rather blank templates that can be completed in an emergency. These include statements of top management, certain wording and phrases as text segments and, depending on the media presence of the company, a website featuring a pre-established private communication channel to contact stakeholders.
The reaction phase comes into play upon the outbreak of the crisis. Three factors are crucial to the success of this phase: speed, accuracy and reliability/consistency. The previously established emergency response team should now be available to meet these three demands and serves as a necessity in achieving the highest level of harm reduction, as it is now a high-pressure situation.
The first factor plays a significant role in the rise of pressure. It is advisable to give a separate opinion to the public within one hour of the crisis announcement. While many measures are still in the implementation phase, the situation needs to be analyzed and addressed. The company statement should be made available to all relevant stakeholders. Acting quickly is key, because news outlets will often speculate or bring in third-party experts when a company opinion has not been issued. Excessive passivity also indicates a guilty plea in the public eye; therefore, the active role must always be assumed in the crisis management process.
The utmost care must be taken when releasing any information. For this reason, only facts, figures and potential impacts on stakeholders may be divulged to the public. Possibly suffused errors or misstatements must be corrected immediately. The spokesperson of the company plays a major role here. A strict adherence to the corporate news is extremely important, as inconsistencies lead to skepticism and loss of confidence.
In all manifestations, the choice of internal channels is of great importance. It is not always useful to inform all parties involved of updates simultaneously. The strategic use of media and its channels of communication play a significant role and should not be underestimated. Depending on the extent, one does not want to unnecessarily draw attention to shortcomings. On the other hand, it must be ensured that the message reaches the correct stakeholders and is not lost in communication channels.
Addressing situations with potential victims is useful in safeguarding a company’s public image. An honest, authentic apology or condolence and the introduction of emergency care aid in public sympathy. However, the extent to which this is done is significant. Under no circumstances should too much activism be shown, as it can quickly be mistaken for an admission of guilt or dishonest action.
Being prepared to act in a reputation-threatening situation is of the utmost importance. Depending on the situation, it offers a wide range of possibilities. If no wrongdoing has occurred, it is conceivable that offenses are being sought. The offense of the actual perpetrator or alleged slanderer and provocative statements thereof are unlikely, but possible. Otherwise, it is vital for a company to promote awareness, as well as demonstrate how the actions will be corrected and how victims will be compensated.
The post-crisis phase marks the end of the reaction phase and employs prevention measures. Though the company will gradually return to normalcy, a crisis must be learned from. The situation will continue to reflect on the company, so material should be updated for future instruction.
In the process of providing stakeholders promised information, analysis and data must be provided as soon as it is available. Sloppiness must not be tolerated, as it may lead to a new outbreak. Stakeholders need to be regularly informed of the appropriate extent of the damage, as well as of the company’s plan of action. Within this, a company can show what action is being taken and how future risks will be prevented, as well as the impact of these actions on stakeholders. Regular information ensures confidence in the company and the recovery of its reputation.
Overall, crisis communication for any company, regardless of its size, is extremely important for future success. No company is too small to be affected by or to manage a crisis; therefore, entrepreneurial diligence and preparation are essential in handling a crisis situation in the best way possible. Failure to do so can lead to lasting damage and massive risks to business.