The Risk You’re Not Managing: Why Corporate Reputation Matters Even When You Don’t Sell to the Public

Every industrial company has protocols for an emergency. If your pipeline leaks, your construction site catches fire or there is an explosion in your manufacturing plant, you know how to address the emergency, secure the safety of personnel and contain the environmental impact. 

But do you know who should speak to the media, who will be inevitably knocking on your door before the fire is out? What should he or she say? How will employees – especially those whose co-workers might be injured – be informed? Do you know who should call your customers and if you should give them an estimate of when you’ll be back on line? And what should you say to the elected official who is about to vilify your company in the media as “another irresponsible corporation” in order to field support for more onerous industry regulation?   If you have a crisis communications plan, you know the answers to these questions. If you don’t, you’re like the majority of other companies who will be caught unprepared when an incident occurs and who will suffer more than they have to in the aftermath. (Even more concerning, the mere lack of a crisis communications plan could increase your legal liability in the event of an incident.) 

And don’t think the only crises that could negatively affect your company involve explosions. Following is a list of the many crises to which today’s organizations are subject.

Reductions in force

Plant closings Infectious disease outbreaks   Discrimination Workplace violence Loss of life Litigation communications Environmental accidents Online security breaches Bankruptcy communications   Boycotts and protests Labor issues Mergers and acquisitions Product recalls Employee misconduct Outsourcing Allegations of fraud Natural disasters Credential counterfeiting Media investigations Sexual harassment         

Terrorist / hostage situations Criminal employee activity Shareholder activism

Companies who are unprepared to respond to the public and other key stakeholders during an incident are at greater risk of jeopardizing customer relationships, drawing the ire of regulators and lawmakers, losing employees and recruits, and ultimately, decreasing the valuation of their organizations. It’s a huge unmanaged risk and one that can be addressed through crisis communications planning. That said, you have to plan correctly. To create an effective crisis communications plan, avoid these common pitfalls.  

Planning situations instead of decisions

In the past, crisis communications plans were filled with “if this, then that” guidance. However, in today’s fast-paced world, it’s nearly impossible to predict the specific crisis that will impact your company. If your plan is written only for certain situations, it’s likely to be useless when you need it. Instead, effective crisis plans define the process for making decisions and taking actions during each stage of a crisis. Those processes are defined based on the organization’s primary vulnerabilities and are often tailored to crises of varying severity.  For example, the process for responding to an incident that entails loss of life is very different from a data security breach. Regardless of the crisis, though, the fundamentals remain the same, and good plans help you navigate them effectively.  

Overlapping and incomplete response teams

Industrial organizations are required to have an ERP (Emergency Response Plan) that clearly outlines who should do what during an incident to secure the safety of personnel and address the emergency. However, is the commander identified in the ERP the same as the lead for crisis communications response? If the answer is yes, you have a problem. One person cannot be primarily responsible for both putting out the fire and leading the public response. Organizations must understand the many different responsibilities a team member might play and ensure no one individual is overloaded during a critical situation.   In addition, do you have enough depth on your crisis communications team? This is not just a job for your head of communications or investor relations. Your team needs to include someone who can facilitate speedy legal approvals; an HR representative who can assist with employee communications; someone with the passwords and know-how to manage your website and social media accounts; and more. Essentially, for every stakeholder your organization has, you should have a representative on the crisis communications team. You should also have back-up team members identified when you realize someone is unavailable (on vacation or maternity leave, for example) when a crisis occurs.  

Slow decisions and review cycles

Speaking of speedy turnarounds on legal reviews, the “business as usual” pace for making decisions won’t work in a crisis. In today’s 24-hours news cycle, your message will be left in the dust. Organizations should have an expedited means for deciding when and how to issue communications during a crisis, as well as facilitating necessary approvals. This will help ensure your organization can respond as quickly as the public needs in order to remain in control of your message.  

Empty trust bank

If you had an incident at your organization tomorrow, would that be the first time the public heard from you? If so, you need to start making deposits into your trust bank today. Trust among the public is something that is built over time. If you have been a good corporate partner in your community, the public will think twice before vilifying you because they’ve seen how your organization cares about its community. On the other hand, if the first time they meet you is during the explanation of your executive’s trip to prison, or after your chemical spill shut down the highway, don’t expect a warm reception.  

Ignoring social media

For many corporations – especially business-to-business companies who do not regularly interact with the public – social media is still not part of the communications picture. As a result, it’s not considered when planning for a crisis. However, you can expect it to quickly become a primary communications channel if you have a high-profile crisis occur that impacts a significant portion of the public. To prepare, you should at least own the social media destinations relevant to your brand, if for no other reason than to ensure someone else can’t grab them and start speaking on your behalf or using them as parody sites. In addition, they can become an important channel for fast, interactive communications to the public during a crisis, such as when your message isn’t being communicated clearly through mainstream media.  

Failing to drill

A good crisis communications plan sitting on your shelf is useless if no one knows where it or how to use it. Thus, to make your investment in crisis planning worthwhile, you must train your team on the plan regularly, either via “table top” drills (when you walk through the plan together during a meeting) or actual simulated crisis drills where each team member acts in his or her prescribed role. Depending on your vulnerability to crisis and the pace of staff turnover in your organization, this should take place anywhere from quarterly to once every two years.

The bad news for organizations today is that the number and type of potential crises seem to grow by the minute. Today, responding effectively requires considering more stakeholders than ever. The good news is that the tools to manage that risk and the upside for doing so successfully get better every day as well.