Business Crisis Management – Five Most Common Mistakes You Don’t Want To Do

Crisis management is in many cases the only thing that distinguishes successful companies from those that fail. Ignoring it in good times can be a costly mistake. However, even when having a plan for crisis events, that doesn’t guarantee the plan is good. Each situation is different and may call for a unique approach to mitigate the possible reputational risk. What are some of the common mistakes businesses make during crisis management?

1. Using untrained spokespeople
One of the best ways to prepare for a crisis is to have your representatives trained on different ways to handle such difficult times. For instance, if your team has to face the media, they need to be prepared with facts and thorough responses to any possible question. In this case, those responsible will need some business crisis communication training. Through the training, they can learn how to pass messages that convey the position of your business in an empathetic, credible way.

2. Going Dark
This is another mistake many businesses are tempted to commit once faced with a reputational challenge. An example of such a case is what Sony Entertainment did during the 2011 data security breach resulting from their Playstation Network attack. They took almost a week to come out and clarify what was happening. What were the results? The public outrage was way beyond control.

Unfortunately, if your company fails to communicate in good time, it will appear like its insensitive, doesn’t care or it is hiding something. It also gives an opportunity for the media or public to peddle speculations and rumors, which in most cases are negative.

3. Lack of a plan
This doesn’t mean a company has to anticipate every problem and come up with a counteractive solution. Instead, there has to be systems in place to make sure once a crisis happens, the right people are notified and can gather to investigate the matter keenly and come up with a solution. In this case, such a plan should outline;

• Key people and faculties to be included in a crisis management team. Depending on the industry, consider representatives from the senior management, legal team, risk management, public relations, and health, environmental & safety departments, among others.
• An internal notification channel and contact lists of the parties concerned
• The names and contact details of relevant public safety departments, regulatory, government, and news agencies that should be notified in case of a crisis.
• Training of key staff and conducting regular drills to test the plan now and then
• Companies that deal with heavy machinery where the whole production stops if one part isn’t working correctly should have an appropriate plan of action to keep the downtime at minimum. Best way to do that is to research upfront on companies that provide rental boilers, mobile steam plants and similar emergency solutions.

Having a plan and notification system prevents a situation where key managers have to learn about a crisis from the media or authorities. Another ugly situation you prevent is where they have to hear about the incidence hours later. Besides, it is in your best interest that the public learns about a crisis from your company representatives.

4. Having lawyers in charge of crisis management
Industries such as manufacturing industry that operate with heavy machinery are likely to face a crisis involving death, loss of property or injury which can sometimes lead to a lawsuit. In those situations, one is likely to consider lawyers as leaders of the business crisis management team. Unfortunately, your legal representatives are wired to keep lawsuits at bay.

Now, one effective ways of calming things down during a crisis is by expressing empathy and relaying apologies to the affected. This act of owning your mistakes, to lawyers it is equivalent to accepting legal responsibility. They’ll want you to remain silent or deny everything, which is not always a good move in crisis management.

5. Losing your cool
It is understandable that during a crisis, things can get heated. Nevertheless, one can contain the situation faster if they stay calm. Acting out of anger can be costly.

In 2013, Gordon Ramsay walked out on the owners of Amy’s Baking Company in a season finale of Kitchen Nightmares. Critics took to the bakeries’ Facebook page with all sorts of comments. Unfortunately, the owners couldn’t stand the criticism and chose to hit back at the critics through their business social media account. Here are some of their posts:

How do you redeem your business’s face from such a mess?

Conclusion
Bad times do come to good businesses too. It is not something you can predict but you should still have a plan of action if you want to keep the financial and possible reputational damage in manageable levels. Learn from the mistakes of other companies so you can pull the right cards in the right time if your business gets caught up in similar situations.