Crisis: a guideline for publicly exposed companies

Nataliia Osadcha, Co-founder of S&P Agency Investment Risk Management, attorney, PhD, MBA, Risk Advisor

The crisis is a difficult period for the company and for its top management. Coordinated actions determine the fate of not only individual enterprises but the business as a whole. In addition, the company does not face large-scale crises every day, therefore, the selection of tools, the formation of an anti-crisis team, the selection of rhetoric’s and channels for public communication typically becomes a new and unknown field for the company, as is the process of overcoming the crisis.

In my previous publications, I have already dwelt in detail on various aspects of the anti-crisis processes, on the selection of the necessary tools, the formation of a strategy, the main mistakes of top managers, various specialists, and the consequences of such mistakes for the company. Today I want to discuss an important issue of crisis communication — that is, the company’s public communication during the crisis. I would like to mention you that I am not a PR manager — I am a business consultant helping companies to get out of difficult crises. Therefore, my practical experience consists of many skills, including crisis communication. Furthermore, I’m confident that it is impossible to successfully overcome the crisis without going into the public and without using crisis communication tools. This, in fact, is one of the main and fundamental errors of many companies: they just do not go out into the public in general, do not argue their position, although the Internet is often overflown with the opponent’s publications that compromise the company, “revealing” all their dark sides.

In this situation, “playing ostrich”, namely hiding your head in the sand not only does not work for the good of the company but also worsens the conflict, destroying the previously formed reputation (no matter how strong it is). And thus quietly and monotonously destroys all business processes. Very often, companies in a state of crisis that did not carry out the necessary work in the public sphere, lose clients and, as a result, market share and profits, cannot participate in tenders, etc.
This confirms the thesis, that reputation does not live separately from business and is not some distant concept. On the contrary, it is directly related to business and profit. It cannot work any other way: if reputation is strengthened – the company has fewer problems, higher profits, and a larger market share. And these are not abstract words of a theoretician, this is confirmed by decades of our cases and financial analysis of our clients.

Therefore, our advice: do not ignore the public plane, or it will cost you more in the long run.

The second common mistake is delegating crisis communication to full-time PR specialists. Every company strives to save the budget, therefore, having full-time PR specialists simply throws this “problem” onto them. The situation is exactly the same with lawyers, who are required to bring the company out of the crisis as soon as possible. Dear entrepreneurs, you are forgetting one important detail: your specialists simply cannot possess quite specific practical skills in the area of crisis. This is a separate “area”! If there are any doubts, ask yourself: how many crises did your staff members experience? How many of these situations brought them to success in the end? If you want to experiment, then — yes, you can delegate the problem to people who do not have any special knowledge or experience and demand from them something that’s virtually impossible. But such experiments are costly for businesses — hundreds and thousands of times more expensive than the cost of external expertise. This is also tested in practice.

As a result, the third mistake follows from the second one — incorrectly selected messages and communication channels. Very rarely we come across well-designed messages that bring the company out of the crisis and do not take it into a deeper one. The solution is that PR specialists must work in tandem with lawyers, who form the foundation of solving the problem. There is no way out without lawyers… Now, here is an eternal conflict between full-time PR specialists and lawyers: the former argue that it is necessary to go out and show ourselves, while lawyers in 95% of cases are against this, believing that public attention to the problem will complicate their work. Therefore, the public messages are weak and look more like the company’s admission of guilt than a reasoned denial.

Such a conflict cannot exist when working with third-party specialists. We effectively combine these two directions. What’s more, the legal part only benefits from this. As for jurisprudence, communications are impossible without the legal part of PR. Without PR communications, jurisprudence is just one of the many tools necessary for solving crises — it is like a sword. However, unfortunately, it is impossible to win a war with a serious opponent having only one sword. Statements that it is possible are misleading.

Any crisis is a painful and difficult process. Anyway, crises can be solved not only successfully but with even greater advantages for one’s reputation and business.

Make the right decisions.