The new crisis landscape

When crisis hits, people expect answers before all the facts are known.

When crisis hits, people expect answers before all the facts are known.

When Sony found itself in crisis mode last year, it was hardly a simple textbook case. Dell, one of Sony's largest customers, had found that its computers using Sony batteries had the unfortunate tendency to, in rare instances, catch fire.

As the news media feasted on the story, blogs ridiculed the companies, and other computer makers took a hard look at their own products, Sony's communications team was working out how to handle a crisis that put it side by side with its own corporate customers.

Sony had to walk the tightrope of satisfying its own clients, while also not falling on the sword of responsibility so much that it could seriously damage the company's reputation. And meanwhile, the story was spreading through the online world exponentially fast.

Rick Clancy, SVP of corporate communications for Sony Electronics, says Sony initially "supported Dell's recall" and worked in tandem with Dell, and later with Apple to support a similar recall. When Lenovo decided to issue a recall based on "much less information," Clancy says, Sony decided to go ahead and issue its own replacement offer worldwide.

Centered as it was squarely in the tech space, the battery crisis was driven to a great extent by the buzz bloggers generated. Sony worked with Burson-Marsteller to both keep tabs on and respond to the blogosphere's chatter.

"The monitoring was one [element], and then, depending on the situation at a given point in time, there was some degree of response and outreach on our part," Clancy says. "But... we didn't share information with bloggers that we did not share with the press."

He notes that blogs were "a key conduit of information" throughout the crisis, and bloggers asserted themselves as a key media group to be reckoned with.

Sony's experience highlights the fact that crises today are not only being started by the ceaseless drumbeat of the blogosphere, but also sped up by the relentless online news cycle - one that's raised the media's demand for quick answers more than anything since the advent of 24-hour cable news.

Karen Doyne, MD of crisis and issues management for Burson, who worked with Sony during the crisis, says virtually all types of crises are fast-moving - and getting faster. "One of the major yardsticks in crisis communications is meeting public expectations. And public expectations are rising all the time, particularly because of technology," she says. "First it was the 24-hour news networks. Then it was the Internet. And now, people demand information immediately and on a continual basis."

That increasing demand means that when a crisis arises, an organization must both respond more quickly and issue more frequent updates to the media and the public than ever before. This larger appetite has led to a conundrum for crisis managers: While the need for information has grown, the actual quantity of good information available about any crisis has not.

To satisfy the public's desire to know while also ensuring that false information doesn't rush out to fill the gap, crisis PR pros are walking a tightrope of expectations.

"Never before has there been such intense competition from the media for breaking news," says Andrea Calise, a Kekst & Co. partner who specializes in crisis work. "Historically, companies [had] more time to prepare for a crisis before it became public. And that's becoming less the case."

In such an environment, both planning for crisis communications and monitoring online chatter to forestall crises before they happen take on even more importance. Clients are recognizing this dynamic - agency crisis pros say they are now modeling crisis situations that address online communications and include how to work with other affected groups on a crisis, similar to the Sony situation.

But Calise warns that "companies must resist the temptation to quickly characterize a situation before it is fully investigated and the facts are understood."

Speak up early

Of course, that doesn't relieve companies of the obligation of making some statements during the first news cycle after a crisis. So crisis managers have to carefully calibrate exactly what they say, balancing their incomplete knowledge of events with a need to avoid appearing obtuse in the press.

Ashley McCown, EVP and co-owner of Boston-based Solomon McCown & Co., emphasizes that completely shutting down during a crisis is exactly the wrong move.
"You can almost always have something to say in those early hours of the crisis, and I think that's critical, particularly with what's happened online," she says.

Those early comments often take the form of the company acknowledging the crisis, detailing what it does and doesn't know to be true about it, and laying out its plans for moving forward. This type of holding-pattern statement quiets the clamoring crowd somewhat, without risking a potentially devastating misstatement of fact.

"The longer you wait to talk, then you have to do two things: You have to respond to whatever the crisis situation is, and you also have to respond to criticism that you're moving too slowly," McCown says. "Those two things together are pretty difficult to surmount."

For companies that constantly monitor the blogosphere, regularly update their crisis plans, and respond honestly and completely as soon as a crisis breaks, the eventual fallout is likely to be minimized. But even after the situation is in hand, it is important to do follow-up communication to restore trust with wounded stakeholders.

"It's vital to be aware of the 'reassurance' phase that comes between crisis response and crisis recovery," says Doyne. The final lesson companies can take from such situations, she says, is the folly of "the tendency to declare victory and return to business as usual."

A crisis checklist for 2007

While some tenets of crisis communications are standard practice, the media and public landscape today does require a recalibration of some principles. Gleaned from a number of crisis experts, what follows is a comprehensive crisis checklist for 2007.

  • Constantly monitor not only the media, but also the blogosphere, where many modern crises are born
  • Have a crisis communications template, and update it periodically
  • Make a statement during the very first news cycle of a crisis, including what you know, what you don't know, and what you plan to do
  • Keep internal audiences apprised of every development. Remember that internal
    communications can more quickly become external these days
  • Work closely with the legal team to vet all statements. Coordinate messaging with investor relations representatives, as well
  • Disclose information as soon as it is verified
  • Give a clear plan of how a crisis is being fixed and what steps you will take to ensure it doesn't happen again. Reach out to key stakeholder groups after a crisis to mend any broken relations
  • Never promise anything you cannot definitely deliver

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