Across the United States, business executives are being increasingly held publicly accountable for the operations of their businesses. As a result, stakeholders have much higher expectations of business transparency. Increased pressure for greater organizational transparency demands that CEOs are capable and willing to communicate effectively to all types of stakeholders – ranging from investors to shareholders, customers, regulators, employees and politicians, among others. The quality of information provided, when it is shared, and how credible the CEO appears when presenting company information all factor into shaping perceptions of CEO leadership and, by association, their company’s brand reputation.
Being an effective communicator can boost loyalty among key stakeholders, whereas not taking time to be well prepared can place lingering doubts on brand integrity or company performance and endear employees and customers to competitors – with negative implications for sales. In a crisis, time is the enemy. Social media-driven news leaks are practically real-time and fuel speculation that require CEOs to quickly engage in damage control. While speed is always an important consideration to ensure the company brand is seen as being “responsive,” “concerned and caring” and trying to “fight the good fight,” a thoughtful crisis response strategy must also consider the lingering long-term implications on brand reputation (and sales).
There are a few good practices to keep in mind when you are moving at warp speed in a crisis situation to ensure that both short- and long-term ramifications are considered.
Rule #1 Isolate the issue: One bad apple does not a bunch make, so always isolate the issue from the rest of your organization’s operations. If you are a manufacturer with a financial internal control issue, that may have nothing to do with workplace safety. It’s paramount to quickly acknowledge that there is a problem, specifically identifying what it is and is not. Answer how it occurred and make it clear that you are 100 percent focused on resolving it. Pledge your commitment, but support that pledge with appropriately timed action steps that you are prepared to take because stakeholders expect action, not rhetoric.
Rule #2: Report progress frequently: Set a timeline and meet it. Deadlines are an important metric that stakeholders use to judge company performance during a crisis. Using every communications vehicle you can afford can be effective to present a unified front of timely progress updates against your stated plan of action. Examples include face-to-face meetings with customers/employees/regulators/etc., social media, advertising, news media interviews, employee communications and video.
Rule #3: Engage with key stakeholders (employees, customers, etc.): First and foremost, employees are the primary ambassadors of your company brand to literally every outside constituency. Employees are the most important assets you can initially invest in during a crisis. Inform employees about your strategy and report to them on deadlines and progress against plan. Ask employees and customers about their concerns, actively listen, and let them know how you will address their concerns or when you will respond to their questions in a thoughtful and timely manner. Set a timeframe for one-on-one, in-person meetings with key staff and town halls with all employees to demonstrate that you are taking the time and making the personal commitment to be accountable as a leader to resolve the issue at hand. This will boost their confidence in the CEO’s leadership, whereas, only engaging “legal or PR” resources to handle it will isolate the CEO and raise questions about culpability or ability to lead.
Rule #4: Institutionalize a best practice: Enlist the involvement of suppliers, employees, and even competitors to build a best practice. Think of an environmental or internal control or manufacturing safety incident. In reality, any and all companies face that exposure. It’s just a matter of whose turn it is. Post-crisis, establishing a companywide employee safety campaign or a blue ribbon panel of industry leaders to create best practice standards reflects well on your commitment as a CEO – and as a company – to lead by example. This presents the CEO as a thought leader who can build bridges to help transform an incident into an industry best practice.
Every dark cloud has a silver lining. Often times, misfortunes are really opportunities to gain useful insight to drive change, which ultimately helps sustain high regard among stakeholders for the long-term reputation of your company’s brand.