Is your company crisis communications ready?

Crises always put a company under intense scrutiny, whether from internal stakeholders such as employees and investors or external stakeholders such as suppliers, customers, regulators and the media. This last group, the media, might have the least invested in the company themselves, but they can still wield an enormous power to damage the reputation of a company long term and perhaps even drive it into bankruptcy.

It is often said that the biggest cost to a company from a crisis is not the cost of putting things right, or even the temporary loss of customers, but the cost to their reputation. Operations and customers can usually be replaced, often quite quickly, but a damaged reputation can take a lot longer to fix and sometimes this can prove impossible. Think about Volkswagen and “emissionsgate”, Tesco and horse meat or Ratners jewellers, whose CEO, Gerald Ratner, described their product range as total cr#p, bankrupting his own company. 

Given these facts, it is wise for every company to consider whether they are ready to handle the communications side of a potential crisis. The first step in this process is likely to be an assessment of their crisis communications preparedness.

This assessment should involve a look at their communications capability across every geography and business unit, as well as from the perspective of the entire business as a whole. This assessment should cover policy and procedures in the event of a crisis, as well as corporate leadership and culture. If the company culture is open and questioning it might prevent a crisis from developing in the first place and would certainly better place it to handle a crisis if the worst does happen. Sadly, many businesses only conduct such a review in the aftermath of a crisis incident, which is better late than never but not the best way to go about it.

Social media is now an area that cannot be ignored when considering crisis communications capabilities. More now than just a marketing tool, social media is a basic communications channel for engaging with customers, stakeholders and the mainstream media. A thorough preparedness assessment will include a review of the role of social media in a crisis situation and putting processes in place to ensure that this corporate capability is put to good use during a crisis event.

To properly assess crisis preparedness, a full testing and exercise programme needs to be put in place. Desktop, virtual or even live crisis exercises form a fundamental part of reviewing and building corporate resilience. They can be used to plan and test different scenarios and effectively train the response team, as well as drawing in other stakeholders such as suppliers and emergency services. 

Finally, once a crisis has occurred, and assuming that the company has survived it, a post-crisis review should always take place. This should look at the effectiveness of the crisis response, its impact on stakeholders, operations and reputation and the lessons that can be learned from how it was handled. After all, if we don’t learn from history we are doomed to repeat it.

Shalen Sehgal
Managing Director Crises Control