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In Case of Emergency: Expert Tips for Weathering a Crisis

August 23, 2018

This article was originally published here on August 1, 2018.

If you’re in a crisis, wouldn’t it be nice to realize: wait, I went to a panel on this very topic with experts in the field? Generally, we hope to avoid crisis — supply-chain issue, customer backlash, unwanted personnel transition, or worse — but it’s comforting to have some tips from folks who been in the trenches for some gnarly events.

This summer, Canaan hosted an expert session on crisis readiness, response and the ways to protect your company and brand as you weather the storm. The panel included:

  • Alexis Krivkovich, Partner, McKinsey’s Financial Services Practice and head of the Silicon Valley office.
  • Keith Yandell, General Counsel and Chief Strategy Officer, DoorDash and former head of litigation at Uber.
  • Nairi Hourdajian, VP, Marketing and Communications at Canaan; former head of communications at Uber; background in politics and advocacy.
  • Julie Grant, Partner at Canaan and previous operator at Genentech. *moderator

In our current moment, planning is more important than ever. As one panelist put it, 10 years ago a bug in a sandwich might include complaints among friends and maybe a letter to the company. Today, one photo can go viral. And that’s probably a good thing! And in this fast-moving environment, companies — big and small — need to be prepared to respond.

Here are some quick observations from the panel. I’ve broken them up into before, during and after a crisis.

BEFORE

Do your homework — can you make a playbook of expectable vulnerabilities? Maybe ask department heads to complete the task (“how would you take down your [product, brand] company in three days?”) — chances are, it will vary significantly by function. Once identified, you can train for them. In the end, the plan may not be applicable …but the process of developing it is always useful.

Draft a team — when something hits, you’ll need to assemble a team quickly. Decide now on the right people from legal, product, communications, etc. Too many companies spend day zero fretting over who will be in the room. If you’re a CEO, imagine what investor or board member you will call when something happens. Know your crisis posse before the crisis hits.

Values and culture are at the core of every company — a healthy corporate culture is the best insurance policy against crisis. It can prevent bad things from happening and also put a company in the position of having the public’s benefit of the doubt. Build a company brand of ethics, corporate responsibility, quality and customer empathy. As an employee – if you don’t see the culture you want; what are you doing to change it?

DURING

Assess  is this a crisis? Will this issue matter in 6 months? Can you imagine this snowballing? If yes: proceed with your crisis plan. Escalate quickly and with empathy. Assemble the inner circle. Get into a room asap.

Consider — external communication, internal communication and root cause analysis. Make tactical plans for each. Prosecute in parallel.

Order of operations — you should be most responsive to inbound press calls. After that, the public, customers, employees and investors should all be on parallel tracks.

Don’t overshare in the first statement — a first statement might read something like: “This is a terrible situation. We have our investigative team dispatching right now. We will be sharing information with you as close to real-time as we can.” Even if you’re still finding your footing, it’s important to be responsive. Silence cannot be what public hears first. But don’t put anything out there that you have to walk back later. Accept that you don’t have all the answers …yet.

Apologies and mea-culpas are not enough — a response needs to have action. What was the root cause of this issue and how is the company preventing it from happening again? If more shoes are dropping on day 2, 3 or 4 then you have not gone far enough or to the right audiences with your remedies.

Business, legal and external — these are the three main considerations for shaping the communications. Companies often over-index to legal and that’s a mistake — a response should be easily understood and sound human, not filled with legal jargon.

Avoid common errors — Examples include: a) Untruthful or inaccurate statements, which is the quickest way to make things worse; b) losing discipline — once you settle on a response/messaging, stick to it. It’s too tempting to veer into new territory when answering new questions; and c) turn off all marketing/social — most ads seem tone death during a crisis.

Internal comms — to the extent possible, communication should go internally slightly before it goes outside the company. It’s not a good for employees to read new information in the press — it creates a vicious cycle of distrust and leaks. The board and lawyers will often be concerned about leak risk but a culture of trust and transparency is key to employee morale. A CEO should also get in front of employees and answer questions quickly — this doesn’t make sense with press but it should be relatively low risk with employees. Answer employee questions until there are no more questions.

Avoid unnecessary information asymmetry — panelists also suggested that CEOs need to communicate more than they might naturally think to. An executive is regularly getting updates from a wide range of stakeholders. But it’s easy to forget that’s a unique and privileged position. CEOs should talk frequently and to different audiences internally. She/he might be saying the same thing 100 times a day but it might be a 1-time impression for each audience. Repeat, repeat, repeat.  

Distributed workforces — remember to give people outside HQ basic information. Delivery people, sales reps and others are on the front lines of the business. They are ambassadors. If they get asked basic questions, you should ensure everyone is signing from the same song sheet.

AFTER

Develop culture-reinforcing habits — find opportunities to demonstrate learning and growth from failure. Some companies institute a “failure of the month” as a presentation at the company all hands. Traditions like this encourage reflection — instead of shame — around failure.

Root cause — keep updating and refreshing the solutions you developed to address the root-cause of the issue. The area that prompted a crisis should be a priority for the company — with dedicated attention and resources — long after the crisis is over.

Consider a public update — depending on the nature of what caused the crisis, it might make sense to provide an update in 6 months to a year. By that time, significant changes have been made and it will demonstrate a seriousness about continuing to address the issue.

Talent flight is rare in the midst of crisis: adrenaline, hands-on-deck, negative corporate halo may make employees less marketable…but when the dust settles, inadequate crisis management and information asymmetry between leadership and rank and file can dampen morale and lead to unwanted attrition. Post-crisis TLC is important for retention.

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