At the most basic level, a crisis is anything that happens in your business—or in some cases to your business—that you don’t control.
We spoke with Nick Mitsis, a senior crisis communications expert with more than ten years of experience helping businesses large and small strategize how to handle a crisis—internal or external—before they actually have one.
Why are crisis communications important?
Colleen: Thanks for sitting down with us today, Nick! Can you tell us why crisis communications are important? It seems like not everyone is thinking about this issue until they have, you know, an issue.
Nick: Absolutely. The best analogy I can give for those businesses who don’t think they need a crisis comms strategy or plan is to think of fire drills. You have regular fire drills for your office building but how many of you—thankfully—ever have a real fire? Being prepared is important for every aspect of your business. When you plan ahead, everyone knows their “exits and meeting points” —who is doing what and when, how to check in appropriately at all levels and when it’s safe to go back into the building, or back to “business as usual.” You want that level of organization for your communications too.
Now if you actually had a fire, you would need to focus on how to put it out and the associated issues that come up—not figuring out who needs to know you just had a fire.
Colleen: That’s a great analogy. With all the priorities in business, it’s hard to make sure that this is also a priority especially because, like you mention, fires don’t always happen. In business, what constitutes a crisis is so impactful that you’d need a communications plan ahead of time to address it, right?
Nick: Correct. A crisis is predominately a situation that you didn’t plan or predict for, that could affect the internal or external perception of your business. It could be obvious things like an executive-level termination or management shift, to the arrest or death of a key executive. It could be a financial issue like bankruptcy or a product or service failure. There are layers to crises and having a plan in place means you develop an appropriately tailored response. An internal employee misconduct issue might not be Page 6 news—unless your employee is Harvey Weinstein—and you would handle that through internal communication channels rather than involving the press.
What happens if you don’t have a plan?
Colleen: Have there been incidents with your clients that you have had to react to when there wasn’t a plan in place?
Nick: Yes, we have had a few incidents occur with a couple of our clients. In one situation, our client was falsely named in a legal battle involving malfeasance and corruption by one of their customers whereby our client was accused of taking kickbacks on a sales transaction—which was false. As soon as the news broke, we worked with the executive management and our client’s legal team to construct a formal response to the claim; key messages for internal and external audiences, and media responses in the event a reporter contacted the company directly for a statement. In this scenario, we advised our client to take a reactive role, but not to actively engage in the conservation as its involvement was false and minor in scope of the overall situation their customer was facing. In the end, not much focus or interest was placed on our client, but their customer enthralled in this crisis ended up going bankrupt.
In another instance, we counseled a client to be a bit more engaged in a crisis situation that could very well impact them directly. One of its—well main—suppliers entered insolvency. Our client’s business solely revolved around this supplier’s product, which was now in jeopardy of being discontinued.
We not only worked with our client to craft a public statement of support and encouragement that its supplier would successfully emerge from its restructuring phase, but also worked with the supplier on key messaging and public statements regarding the product. This was in effort to assure consistency and guarantee that no unlawful statements were made in the public domain.
Colleen: What about things that didn’t happen directly to companies but might affect it? Is there an appropriate level of “preemptive paranoia” companies should engage in to protect themselves?
Nick: If your primary supplier suddenly declares bankruptcy or the technology your business runs experiences a critical failure, you definitely want to proactively address the issue so your customers and employees don’t misinterpret the situation and you provide transparency so you can have as much control over the messaging and situation. Issue a generally supportive statement with what you’re doing to protect your stakeholders, customers, employees, etc. in light of this issue. Make sure to keep your messages the same internally as well as externally. Your employees shouldn’t see one thing on the news and read another thing on the employee intranet. Remember—this is not the time to say “good riddance” to the CEO of your partner/supply company that just got ousted—but be clear that your success is not tied to their future.
How do small companies get help?
Colleen: At big companies, I presume they have a legal and communications team hashing out these details, but for small- to medium-sized companies who are just as at-risk, this is yet another thing on the never-ending to-do list of priorities. How can those folks get help?
Nick: A great agency will proactively establish a plan for them before they have a crisis. During a planning phase they would develop the internal and external strategy, messaging and channels to communicate; the roles and responsibilities for everyone involved; and establish guidelines for what can and cannot be shared. Don’t forget Social Media, of course!
When something happens, that agency will be right there, shoulder-to-shoulder with them executing the plan so they can concentrate on their customers, stakeholders and their business. If you need to be on the phone with your investors, the agency can talk to the press. If you’re too close to the issue, the agency can draft the employee email.
Also, speed is of the essence. Get the information out in a timely manner before the rumor mill starts. It’s important that your company own the narrative rather than follow it. I worked with a company where the CEO was embezzling funds. When law enforcement stormed the building to arrest him, he tried to escape to the roof! The entire company saw the drama unfold. Just ignoring an issue will not make it go away!
Colleen: What a crazy story! Thanks for sitting down with us today, Nick.
I learned a lot about what a crisis could do to my business reputation and future success if ignored. You might not be able to control the things that happen to you in business, but you can control how you respond and move forward.