No one likes a crisis, but for those who have had to deal with them the stories aren’t always as dire as it may appear at first glance. Some will point to the opportunity to make something right in a situation that could have been far worse. Others will tell stories about how going through a trying time with colleagues and stakeholders in the end helped them and their organizations forge stronger bonds.
My Favorite Crisis
A cross-section of crisis situations that I’ve handled have ranged from bankruptcy filings and missed earnings expectations to litigation and workplace situations. None of these problems were inherently positive, but there were a few that when I think about it I’m glad I was there to help.
The one that comes most prominently to mind was the time I received a call from the wife of the CEO of a tech firm who told me that during the night his father, the chairman of the company, had died. Since his father, who was liked, respected and admired by many, had suffered from a serious life-threatening health condition, I had a plan in place for this possibility.
Prior to that morning, I had informed the CEO that should the worst happen, I was prepared on the communications front. So, when it actually happened, he didn’t have to do anything more than to tell his wife to call me and say, “We know you have a plan for this. Implement it.”
Immediately, I felt thankful that I was in a position to alleviate some of the burden from the CEO in his time of grief.
The company was publicly traded, so the biggest concern was the possible reaction from analysts on Wall Street and investors. Since the death happened over a weekend, we knew that we had until the stock market opened on Monday morning to prepare.
In the end, this event was a litmus test in the confidence the market had in the CEO and the company’s leadership team.
Other important concerns were the impact the news might have on customers and employees, though these concerns were somewhat less because most customers and employees had substantive experience with the organization and readily understood that day-to-day operations would not be affected.
The Risks and Complications
The major risk in this situation was that a negative impact on the company’s stock valuation could have an effect on current and potential investors, employees who were invested in the company, and on the company’s reputation.
The most important thing we did was have a plan in place for the scenario that eventually happened. We knew in advance what the challenges would be. We knew who our most important stakeholders would be and what they would need to know and want to know.
The plan called for a quick all-hands-on-deck management meeting over the weekend. I was able to use the plan as a meeting agenda and fill in as much information as possible so that I had the substance needed for all communications. These included disclosures to the media, employees, customers and others. We were able to quickly establish internal and external communications protocols.
The key message was that while this event was extremely sad and troubling, since the CEO had been in place for some time, and had been the driver behind the company’s currently strong performance, the sad news would have no impact on the day-to-day operations.
We were well prepared to announce the news to all important stakeholders before the market opened that Monday.
When the market opened on Monday, we had already communicated the news broadly to the media and to the analyst community on Wall Street. Employees and customers were informed personally and directly by their managers and representatives.
At the opening bell, the company’s stock price was not impacted by the news. There were no sudden point drops. From the standpoint of the market, it was generally understood that even with the loss of its chairman, the company remained in good hands.
For me, the thing that makes this my favorite crisis was that I was able to achieve the results that come with good planning so that the CEO of the company was enabled to focus on the personal challenges of losing a father and a friend.