reputation risk management

Reputation Crisis Management

The focus of most business continuity plans is operational resiliency – how to keep operations running smoothly in the event of an unforeseen crisis. But some crises don’t involve disruptions to service delivery. When a reputation-based crisis occurs, the reputation crisis management steps for restoring marketplace trust are vastly different than those required for physical disruptions and/or power/IT failure.

Warren Buffet was quoted as saying “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”

Reputation-based crises can be triggered by any number of events. Some examples include:

  • FIFA (International Federation of Association Football): Seven FIFA officials arrested on May 27 on suspicion of receiving $150M in bribes
  • Planned Parenthood: Controversial videos released by anti-abortion group suggest Planned Parenthood was selling aborted fetuses for profit
  • Tylenol (Johnson & Johnson): The Tylenol murders were a series of poisoning deaths resulting drug tampering in the Chicago metropolitan area in 1982.
  • Blue Bell Ice Cream: Listeria outbreak in multiple plants caused system-wide shut down for nearly four months.
  • Toshiba Accounting Scandal: Electronics giant overstated earnings by more than $1B leading to full housecleaning of board and executive committee plus review of Japan’s corporate governance policies.
  • NBC Brian Williams Scandal: News anchor falsified accounts of being on a helicopter that was shot down while he was reporting in Iraq. Resigns in shame.

When managing a reputational crisis, the goal is to minimize escalation and lasting financial impact. In our 24 x 7 digital world,
there are no secrets. News, especially when tinged with scandal, travels with lightning speed and can be easily misconstrued.

Reputation Crisis Management Tips

Activate Your Crisis Management Team: The instant it looks like there is an issue, the reputation management team needs to be alerted. This shouldn’t be limited to internal and external communication teams, but rather needs to include operations, sales, customer service, marketing and key executives. Make sure the team has their finger on the pulse of traditional and social media as well as hearing direct feedback coming into sales and service teams.

Get Your Facts Straight: A common cause for reputational crisis escalation is miscommunication. Sometimes as a crisis is unfolding all the facts are not known. Don’t Guess! Be clear on what you do know now and what steps are being taken to get a better handle on the situation. You don’t want to have to retract statements made that are later proven incorrect. Think Lance Armstrong.

Communicate Proactively and Transparently: While you don’t want to communicate before all of the facts are understood, it’s equally important to not appear to be hiding from the situation. The sooner you can have key company executives proactively releasing the information and appearing to be as transparent with the facts, the better. This will instill trust and helps to reduce media bashing.

Manage All Communication Channels: Holding a press conference with the CEO is just one way to get a message out. Unless all employees and communication channel managers are briefed the facts and advised as to what they can and cannot say, the chance of a garbled message getting out are quite likely.

Be Human: Scandals that last longer tend to involve arrogance and lies. If you or your company did something that is resulting in media and/or customer outcry, a defensive or haughty response could be just the thing to prolong the pain. Apologize if it is called for and instill confidence that you have a
plan in place to make things better.

Take the High Road: When a scandal hits, the rules of polite society often get forgotten. Your customer service representatives may have to deal with screaming, irate customers, your media relations team with skeptical reporters and your executives with accusations and embarrassment. Reacting with anger to any of these situations will only make matters worse. In times of crisis, every member of your company needs to maintain composure and stay on message no matter what level of rudeness they encounter.

How to Use This Information

If you find your company, potentially, looking at a reputational issue, the way you handle it will directly impact the issue’s lasting effects. It is a time to keep your team sharp and practice reputation crisis management which includes close collaboration, accurate communications and timely messaging. We can help simplify all of this with a crisis management and incident management tool, such as MissionMode’s Situation Center™. Schedule an online demonstration or call us today at 312-455-8811.