Tag Archive for: Crisis Management

On Wednesday, October 25, Logos president Helio Fred Garcia‘s conversation with award-winning advisor and trainer of NBAU Consulting Natalia Smalyuk on core principles of crisis response was published on the NBAU Consulting website. Their conversation was part of Smalyuk’s Coffee-Break Q&A series. Garcia and Smalyuk discussed the need for mental readiness in a crisis, the importance of defining a crisis clearly, and some of the predictable patterns of crisis and crisis response.

Below is an excerpt from their conversation:

Natalia

Fred, one of your books is called “The Agony of Decision: Mental Readiness and Leadership in a Crisis.” In my experience, mental readiness is not something we hear a lot about in the offerings of the PR firms, which is the world I am coming from. Is there a gap in the preparation of leaders for high-stakes scenarios?

Fred

I came out of the PR firms, too. They can be really good at executing communications, but not necessarily helping leaders avoid wrong choices. And if you execute wrong choices, you are making the crisis worse.

The firm I run, Logos Consulting Group, is a management consulting firm. We counsel leaders on how to make smart choices under stress, and how to execute them in a way that maintains or restores trust. As a professor of management, leadership and communication at several universities, I tell my students that crises follow predictable patterns, and patterns have two kinds of power – explanatory and predictive. First, they help us make sense of what happened in the past. Second, they give us the power to predict what might play out in the future. Knowing the pattern, we can tell the leader that, if they do A, here’s the likely consequence. If they do B, here’s what they can expect. In a crisis, we know things are going to be bad. The leadership discipline is about finding the “less bad” outcome and then making choices that get you closer to that “less bad” outcome.

Natalia

In our earlier conversation, you said that, to put crisis management on the right track, it’s important to ask: “What problem are we trying to solve?” How do you get decision-makers to think clearly in the heat of the storm?

Fred

The best way to get leaders to make good choices in a crisis is to have a really thoughtful crisis planning process that defines a crisis and has a sequence of questions to ask. Here’s an example. A client approached me with what they called a “60 Minutes problem.” Their PR people defined it as a news media enquiry leading to an embarrassing story. I asked a series of questions about what was happening and ultimately told the client: “You don’t have a 60 Minutes problem.”

The company was discovered to have systematically cheated customers and was being sued for this. Essentially, lawyers were trying the case in the media. Hypothetically, it was possible to get 60 Minutes to walk away, but the lawyers would just give the story to the Wall Street Journal or someone else.

I told the client they needed to recognize several things:

a)       The company had committed misconduct.

b)      Their customers had been cheated.

c)       As soon as this became public, the regulators would be all over them. They would sanction the company and might hand this over to criminal investigation.

So, I told the client they had a business problem.

My advice: stop the business practice that is dishonest and possibly illegal. Remediate the customers that were cheated. Fire those who allowed the practice to happen. Hire a high-quality auditing firm to monitor behaviour. Then take all this to the regulators and tell 60 Minutes that you’ve done all that.

The client was horrified that I was that candid, but the CEO and the board took my advice to heart and followed it. The regulators thanked them for bringing the issue to their attention, put investigators on the premises and ultimately sanctioned the firm. However, that outcome was far less severe than it could have been, and regulators commended the company for self-reporting. The story on 60 Minutes was still horrible. The customers talked about all the ways they had been cheated. However, the company’s side of the story was there, too: “We screwed up. We fixed it. We apologized. We self-reported to regulators. We are working closely with them.”

The bottom line is that every crisis is a business problem before it is a communication problem.

Similarly, every crisis is a business problem before it is a legal problem.

The United States is the most litigious country in the world. When the lawyers hear a company is or may be sued, they worry that anything you say will increase your liability in litigation. Here’s a paradox. If you can show that you take the issue seriously and are committed to fixing it, instead of creating legal liability, you are keeping the company healthy.

Here’s what I’d tell the CEO: “For what I know, you’ve gotten excellent legal advice. However, you don’t have a legal problem. You have a business problem. Whatever legal problem may emerge in the future, you have shareholders, employees and customers now, and you have the control of how they think about you. So please don’t make a legal decision. Make a business decision.”

When the lawyer says “you can’t say anything,” I believe what they actually mean is: “don’t say anything dumb.” We don’t want the company to say something dumb. Quite the opposite. We want it to say something smart and helpful. So, here’s how a series of questions with the lawyer might unfold.

I’d ask: “Can we acknowledge that we are aware of this problem?” The lawyer may say: “Yes, but we have to do it very carefully.” Great. We can very carefully acknowledge that we are aware of the issue.

Next question: “Can we express empathy for those who were disadvantaged by this?” The lawyer might say: “We can’t admit guilt.” Well, I am not asking to admit guilt. I am asking to express empathy. The lawyer’s response: “We have to do it very carefully.” Great. We can very carefully express empathy.

Next question: “Can we declare the values that drive us in this crisis?” It’s hard to say no to this – even though, in my experience, one lawyer did. After all, values are on the company’s website. The lawyer might again say: “We have to do it very carefully.”

Can we describe the process we have begun and will continue to get through the crisis? Yes – if we do it carefully.

Finally, can we make some form of commitment?  Yes. It could be a procedural commitment, such as: “We’ll update you at 3:00 p.m.” or a substantive commitment, such as: “We’ll get to the bottom of this and we’ll fix it.”

These five questions are five elements of a well-structured stand-by statement. 1) Acknowledge the problem – or at least your awareness of it. 2) Express empathy. 3) Declare your values. 4) Say what you are doing to fix the problem. 5) Make a commitment.

Between self-defeating silence, which is what the lawyer is suggesting, and self-destructive blabbering, which is what the lawyer fears, there’s a lot of room to maneuver.

 

Read their full conversation here.

On Monday, August 28, Logos president Helio Fred Garcia‘s interview on the Shaping Opinion podcast was released. Hosted by communications professional Tim O’Brien, Shaping Opinion is an award-winning podcast that dives into the people, events and things that have shaped the way we think.

In this episode, Garcia and O’Brien discuss ethics and crisis communications. In their exchange, Garcia and O’Brien discuss some of core principles and best practices of crisis communication, the kinds of ethical issues and dilemmas that occur in crisis communications, and how Garcia built his career in crisis management and communication.

Listen to the full podcast interview here.

On April 21, 2022, Logos president Helio Fred Garcia participated in the inaugural Global Brand Convergence, a free online experience for higher education students, faculty, and professionals around the world in public relations and marketing. Garcia participated in a panel discussion on “Crisis in an Enduring Pandemic,” alongside renowned communicator and crisis advisor Dr. Guanpeng (Steven) Dong.

Conceived by Jacqueline Strayer, the Global Brand Convergence was designed to connect and create a community to share ideas, innovations, and concepts to advance them in the classroom and in the profession. The inaugural event boasted more than 500 registered attendees from 50 countries and 54 colleges and universities.

In their session, Garcia and Dr. Dong discussed lessons learned from of how the COVID-19 pandemic was handled by the US and by China and several core principles and best practices in crisis response. Garcia and Dr. Dong have worked together in several capacities over the past 10 years, and in 2019 Dr. Dong was awarded the Logos Institute Outstanding Leader Award.

Watch the full panel discussion, moderated by Iliana Axiotiades here:

In addition to Garcia’s participation in the event, Logos Consulting Group was proud to be one of the sponsors for this annual event. To learn more about the Global Brand Convergence, visit https://www.globalbrandconvergence.com/.

The following is an excerpt of a guest column by Helio Fred Garcia published in the May 2022 issue of PRSA’s Strategies & Tactics

Effective crisis communication can help organizations maintain trust, inspire confidence, and build competitive advantage.

The pandemic, the Great Resignation, political polarization in the United States and war in Europe have made the need for effective crisis communication even greater.

Increasingly PR professionals are being seen not only as communicators, but also as business problem-solvers, who can help their clients navigate the challenges of maintaining the trust of stakeholders in rapidly-changing times where the stakes are increasingly high.

But PR people don’t deserve a seat at the leadership table simply because of our function. We need to earn that seat. And that means we need to elevate our game and become a respected voice when CEOs and other leaders are under stress and worried about their enterprise and their legacy. Take, for example, the common struggle PR people have with lawyers. And how easy it is for CEOs to take lawyers’ well-intentioned advice.

Making the business case

Over more than 40 years I have advised lawyers and been hired through lawyers to advise our mutual clients. I have taught lawyers through bar associations and have trained individual lawyers in crisis management. And I have fought with lawyers; sometimes I have won those fights. And I have learned from lawyers.

A typical interaction is this: In the CEO’s office the lawyer will give all the legal reasons to say as little as possible – ideally nothing – in the early phases of a crisis. The CEO will then look at me.

My reply is not to make the PR case, but to make the business case:

“I believe you have received excellent legal advice. And you should take it seriously. But please recognize that you don’t have a legal problem, at least not yet. You have a business problem. And you need to make a business decision. You need to consider the risk of legal liability seriously. But not exclusively.

You should also consider the consequences of losing the trust of those who matter to you: your employees, customers, investors, regulators, and others. Silence now will be interpreted as indifference, or worse, and will lead to loss of trust of those who matter most to the company. You can protect yourself from legal liability that will play out years from now, but lose the company in the process. Or you can attend to the immediate needs and concerns of your stakeholders now, in ways that manage future legal liability.”

It’s very hard for the lawyers to object to that. But the key is that we need to be in the room in the first place, to make the case directly to the CEO in the lawyer’s presence. Otherwise, the CEO could reflexively take the lawyer’s advice, without considering the short-term implications. And we’d then be tasked with implementing a suboptimal response.

The CEO then typically asks me to advise on what we could say that would pass legal muster. I ask the lawyer about categories of possible communication:

  • Acknowledge: Can we acknowledge awareness of what has happened? The answer is usually Yes, but very carefully. My reply, Great. Let’s do it carefully.
  • Can we express empathy toward those who are affected? The lawyer usually says, Yes, but we need to be careful to not admit blame. Same reply by me:  Great. Let’s do it carefully, in a way that doesn’t admit blame.
  • Can we declare our values? When the lawyers object, I point out that we typically have them published on our website.
  • Can we describe the overall approach we will take to address the crisis and resolve it? The lawyers usually say we need to be very careful. I again reply, Great. Let’s do it carefully.
  • Can we make some kind of commitment? How about a procedural commitment: We’ll update you when we know more. Or a substantive commitment: We’ll get to the bottom of this and fix it.

In essence, when the lawyers say we should say as little as possible or say nothing, they are channeling an unspoken fear that the company’s leaders will say something dumb; something that will not only increase risks in future litigation but also energize adversaries, regulators, and others to come after the company.

I don’t want the company to say something dumb either. But between self-defeating silence and self-destructive blabbering, there’s lots of room to maneuver. This recognition often leads to the lawyers and communicators collaborating early in the crisis to find the balance. It doesn’t need to be adversarial or either-or.

Managing the choices

At a high level of practice, crisis communication is a rigorous process of managing the choices we make with a view on the desired outcome. The discipline is that leaders should never make choices based on personal preference; they usually do so in ways that make them feel less vulnerable that that can infuriate stakeholders.

Rather, we need to have clear criteria on the choices leaders make – of what to do and say, of when to do and say it; of whom to say it to; of who should do the talking. The more rigorous the approach, the more likely we’ll be seen to be business problem-solvers, and to be in the room before decisions are made.

 

Read the full article and more here.

On January 21, 2022, Helio Fred Garcia was featured in an article on Communication Intelligence about a recent webinar Garcia led for the Public Relations Society of America (PRSA).

The webinar, titled “Maintaining and Restoring Trust in Times of Great Change,” focused on the drivers of trust and techniques to maintain and restore trust in times of crisis.

In this interview, Garcia shared some of the core ideas and key takeaways from his webinar on January 20.

“Trust is the natural consequence of three related but distinct factors,” Garcia explained. He then described each of these factors in detail: promises kept, expectations met, and values lived. When you take these drivers of trust seriously, you are more likely to ask the right questions and make smart decisions in a crisis.

Garcia also explained one of the key reasons why organizations and leaders struggle to respond to crises effectively.

“Most failed crises arise when leaders fail to think of the crisis from the perspective of stakeholder expectations, but rather start from their own personal preferences, fears, anxieties, etc. This is the case in celebrated failed crisis response, from Volkswagen to BP to United Airlines to Trump COVID,” Garcia explained. “Making decisions in a crisis from personal preference is a mark of poor leadership and nearly always makes the crisis worse.”

Click here to read the full article.

The following is a guest column by Helio Fred Garcia, originally published on CommPro.biz on January 3, 2022.

This week marks the start of the third year of the COVID-19 pandemic in the United States.

By the end of 2021 more than a half million Americans were catching COVID-19 every day. One in every six Americans had come down with the virus; one in every four hundred had died.

Much of this was avoidable. And we return from our holiday facing the latest surge and wondering whether it’s safe to reopen as planned.

COVID-19, Crisis Management, and Leadership

Since the beginning of the pandemic, the United States has mounted the worst COVID-19 response in the developed world. In 2020 the American response was driven by incompetence, dishonesty, and neglect.

2021 began with a glimmer of hope, and by April – when vaccines became universally available – the daily death rate plummeted.

But by late June both vaccinations and masks became highly politicized and deaths began to soar again. By year end hospitals were at capacity; the overwhelming percentage of hospitalizations and deaths were among the unvaccinated.

 

https://www.commpro.biz/?s=crisis+management+helio

Illustration 1, Source: New York Times

 

But there is opportunity in every crisis. COVID-19 provides an active case study to learn not only about public health, but also foundational principles of crisis management. As the Greek philosopher Plato said in The Republic, if you want to understand something difficult, study the biggest instance of it that you can. Then apply those learnings to smaller matters. There’s no bigger crisis right now than COVID-19.

For decades in my crisis management practice, I have preached that the severity of an underlying crisis does not determine how the crisis turns out. Two organizations in the same crisis at the same time can have dramatically different outcomes. Rather, the timeliness and quality of the response determine whether or not an organization suffers a catastrophic outcome. Act effectively and quickly and the crisis resolves or plays out with minimal damage. Delay, deny, or dither and things get disproportionately worse.

It is uncommon for multiple organizations to go through the same crisis simultaneously. But COVID-19 is a crisis with which every organization around the world has been grappling. We now have experienced a kind of laboratory experiment of how different jurisdictions responded to the pandemic differently. We can track the different outcomes. We can learn from them. And we can apply those lessons, not only in the continued pandemic response but in future crises, as well.

Crisis Management Works

All the trends point to a common conclusion: Crisis management works. But only when we manage the crisis effectively. Failing to follow crisis management principles can have devastating consequences. There are four rules that lead to the successful resolution of a crisis:

  1. Take the crisis seriously.
  2. Take the risks seriously.
  3. Mitigate those risks.
  4. Act quickly: the longer it takes to mitigate the risks, the harder it is to do so.

We can see clearly how the death rates in different jurisdictions varied based on leaders’ adherence, or lack of adherence, to these rules.

Continue reading here.

The following is a guest column by Helio Fred Garcia, originally published on Forbes on October 19, 2021.

In mid-September the United States passed a tragic milestone: one in every 500 Americans had died of Covid-19. By early October, it was one in every 469 Americans. And counting …

For decades in my crisis management practice, I have preached that the severity of an underlying crisis does not determine how the crisis turns out. Two organizations in the same crisis at the same time can have dramatically different outcomes. Rather, the timeliness and quality of the response determine whether or not an organization suffers a catastrophic outcome. Act effectively and quickly and the crisis resolves or plays out with minimal damage. Delay or dither and things get disproportionately worse.

It is uncommon for multiple organizations to go through the same crisis simultaneously. But Covid-19 is a crisis with which every organization around the world has been grappling. We now have experienced a kind of laboratory experiment of how different jurisdictions responded to the pandemic differently. We can track the different outcomes. We can learn from them. And we can apply those lessons, not only in the continued pandemic response but in future crises, as well.

Crisis Management Works

All the trends point to a common conclusion: Crisis management works. But only when we manage the crisis effectively. Failing to follow crisis management principles can have devastating consequences. There are three rules that lead to the successful resolution of a crisis:

1. Take the crisis seriously.

2. Take the risks seriously.

3. Mitigate those risks.

We can see clearly how the death rates in different jurisdictions were different based on leaders’ adherence, or lack of adherence, to these rules.

A Tale Of Two Nations: Republic Of Korea And United States Of America

On January 20, 2020, the U.S. had its first confirmed Covid-19 case. That same day the first confirmed Covid-19 case was recorded in South Korea.

Unlike the U.S., South Korea took the crisis and the risks seriously. Six years earlier, it had been burned by its mishandling of a public health emergency that had led to dozens of deaths and that had almost brought down the government. Not this time: No dithering, denial or delay.

Initially, South Korea had the highest Covid-19 death rate outside of China. But its leaders quickly worked to mitigate the risks. They launched a whole of government response. In particular, South Korea followed all the mitigation guidelines that the U.S. Centers for Disease Control and Prevention (CDC) advised. These included mandatory masking, distancing, quarantines, contract tracing and testing. And it worked. Infection and death rates plummeted and have stayed low.

The United States did not take the crisis or the risks seriously, nor did the U.S. act to mitigate the risks. President Trump and his allies persistently denied or downplayed the reality of the virus.

The United States never had a whole-government response. And the nation never consistently followed CDC guidelines. In 2020, leaders, including the president, rationalized away the risks. They failed to model safe behavior, even including the wearing of masks. They continued to have large unmasked gatherings. And the pandemic itself became inexorably tangled into the politics of a presidential election, with large numbers taking sides about the reality of the virus itself, a disturbing trend that continues to this day, nearly a year after the election.

But public health experts have been sounding the alarm about the risks for more than a year. Last October, Columbia University’s National Center for Disaster Preparedness concluded that of the 217,000 American Covid-19 fatalities to date, as many as 210,000 could have been prevented by taking appropriate precautions. At the time the U.S. had the highest Covid-19 rate among peer countries. Korea had the lowest.

At about the same time, the venerable New England Journal of Medicine said that the U.S. had failed at every step to take effective mitigation steps and said Americans were dying because of a leadership vacuum.

In February 2021, the British medical journal Lancet noted that as many as 40% of American Covid-19 deaths could have been avoided.

Even after the vaccines became widely available, the seeds of distrust and division continued to hamper mitigation efforts, especially in states whose governors forbade mask mandates and where vaccine hesitancy prevailed.

By late September 2021, American deaths had surpassed two round numbers — one in 500 Americans, for a total of 700,000 deaths. Columbia University Professor Jeffrey Sachs noted that if the U.S. had done what was necessary to keep the death rate the same as our peer countries, 650,000 fewer Americans would have died.

So, what is the current Covid-19 death rate in South Korea compared to the U.S.? One in every 20,000 South Koreans, compared to one in every 469 Americans.

South Korea followed the three crisis management rules:

1. It took the problem seriously.

2. It took the risks seriously.

3. It did what was necessary to mitigate those risks.

The United States did not. The difference: American Covid-19 deaths are at 42 times the rate in South Korea. Most American fatalities were preventable, especially after the vaccines became available to anyone willing to take them.

We see at the national level dramatically different outcomes to the common crisis. There are many lessons we can harvest from the tragedies — including the dangers of misinformation and of political polarization of science. But the crisis management lesson, devoid of politics and ideology, is clear: In a crisis, take the crisis seriously, take the risks seriously, mitigate the risks fully. The outcomes will be far less devastating.

On September 3, 2021, Logos President Helio Fred Garcia was quoted in Loss Prevention Magazine on how 7-Eleven has invested in technology to better execute crisis communication.

 

7-Eleven has heavily invested in both crisis communication processes and software to ensure both company leadership and franchisees can share information with each other and report on specific needs and issues.

 

Garcia noted the importance of having multiple communication channels available for times of crisis to lessen any communication gaps in times of crisis. “You also need to plan for redundancy in the manner of delivering messages. If phone lines are down if the email is down, you still need to communicate,” he explained.

 

Read the full article here.

On July 1, 2021, Logos President Helio Fred Garcia was featured in Reputation America on crisis management strategies and steps for leaders to mitigate crises effectively.

The article excerpts a speech given by Garcia on crisis management. The article includes excerpts on how to define a crisis, types of crisis readiness, common crisis missteps, how to manage social media in a crisis, and how to ask the right questions in the right order to get through a crisis well.

“The biggest mistake is to attempt to improvise in the crisis and ask the wrong questions in the wrong order. Concern about how to deflect blame or protect one’s own job is not the best strategy in crisis communication management. Companies need to resolve the stress and be rigorous in managing crises,” said Garcia.

Read the full article here.

On June 11, 2021, Logos President Helio Fred Garcia was quoted in Idea Grove, sharing his advice on how to manage an organization’s reputation in a ‘post-truth, cancel culture world.’

Scott Baradell, CEO of the unified PR and marketing agency Idea Grove, states that in 2021 brands must be prepared to go on the offense by preparing for the foreseeable, thereby softening the blow to a brand’s reputation should a crisis occur.

In this article, professional communicators share their ideas for reputation management. Garcia’s advice: run a simulation.

“Simulations can be really valuable learning opportunities for leadership teams to assess their current ability to effectively address organizational risks, without the high stakes and consequences of an actual crisis,” he explained. “Simulations can also be custom-designed to target vulnerable areas of the organization (e.g. ability to respond to customer complaints on social media) so leadership can more quickly strengthen their response capacity to a specific risk or area of concern.”

Read the full article here.