By Matt Eventoff
Every day there are myriad stories in the news about companies dealing with crisis situations; many more never make a news broadcast. Missed earnings, resignations, down cycles, layoffs, funding issues (especially for startups) offshoring, and board shifts are all problems that can stay in the family with the correct steps.
- Develop Relationships with Board Members, Investors, and Others BEFORE a Crisis or Bad Bit of News. This may seem like common sense but can often get pushed to the side in favor of day-to-day responsibilities that yield immediate results. The reality is it is much easier to communicate bad news to someone who is used to hearing from you regularly than someone who hears from you once a quarter. Another caveat: sometimes board members can be the best advocates a company can have during a tough quarter; however, one of the keys to having effective advocates is regular contact and flow of information.
There is a reason why some of the greatest political leaders of our time continue to make phone calls and write notes to key supporters during off years, long before election season is looming on the horizon.
- Communicate More Often. There is a tendency when times are good and everything is running very well to communicate a little less. Yet, this is the time to communicate more, andnot just at monthly meetings, especially during tough economic times. Yes, this is a bit counterintuitive as a CEO wants to spend as much time as possible “adding value”; however, I would argue that keeping investors and board members active, involved, and included (rather than frustrated) adds as much value as anything else.
- Communicate Regularly. One technique that works well is sending
weekly e-mail “Updates from the CEO” that consist of a paragraph or two delivered weekly or bi-weekly, internally, with the high and low points for the company. Why? It reinforces the message of engagement with the board and investors, by getting the board in the habit of receiving regular correspondence outside of when they are “supposed” to get it. This is a great initial step.
- Pick up the Phone. Call your investors and board members regularly. They might be too busy to take the call. Call anyway. They may tell you that you do not need to call. Call anyway.
At the same time, the last thing any executive wants, or can afford, is to only focus on investors and board members. Equally important is communicating regularly throughout the organization, which leads to the next five steps:
- Communicate Internally: Front Line to the C-Suite. Be open. Be available. Talk to people. If you are a CEO, be seen. Nothing is worse than a CEO who stays behind closed doors. Your organization needs to know not only what is going on but what it means (the message), and, an important point for CEOs, what it means to you is likely different than what it means to an employee.
- Treat Your Top Talent as You Would Your Board and Investors. If you think you have talked to them enough, go back and talk to them one more time. Trust me. If your top talent is nervous, and you are not communicating with them, they are looking elsewhere. As times get more challenging your top talent becomes more valuable. Replacing superstars in this environment is not easy. Ignore this step at your own peril. I regularly hear executives lamenting, “ I can’t believe _____ left, I never even knew she was unhappy.” If ______ was your sales leader in a down economy, you now have a major crisis.
- Be Consistent. Nothing deflates an organization, employees, a board, or an investor more than perceived inconsistency in communication or communication style. Everything a CEO, CFO, COO, SVP, AVP, and so forth does sends a message—to the board, to the organization or a single team, and communication, or lack thereof, sends a clear message and not a positive one.
- Be Open with Information. Trying to hide bad news is no longer possible; moreover, it will absolutely destroy all credibility. In a 24/7 information cycle, the news will get out, and it is always better if an organization delivers it than if it is delivered by someone else. This counts for major corporations as well as for news that ends up in the paper. News is spread, in the form of gossip and rumor, through organizations of four or 40,000 every day. Just because you haven’t announced it doesn’t mean that your employees don’t know about it, which leads to the final step.
- Be First. Define the news before anyone else defines it for you; this is politics 101. If you have negative news, or news that can be construed in a negative light, communicate it firstand don’t worry. On the other hand, if you don’t and it exists, someone will find it, and this is one game where finishing second does not lead to a silver medal!
About the Author(s)
Matt Eventoff has served as a communication and messaging strategist for C-level executives, ranging from start-ups to those in the Fortune 100; as well as political candidates in the United States and abroad. His specialties include communication training, message development and training, media training, and crisis media management. He is the founder of Princeton Public Speaking.