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The Big Picture of Business – Achieving the Best by Preparing for the Worst: Lessons Learned from High-Profile Crises, part 4 of 4

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Thinking Through the Strategies

Crisis management is so much more than handling of the media. A major oil company had a plant explosion and proceeded to do a good job of communicating afterwards. Unfortunately, the follow-through never transpired after the media coverage died down. Thus, lawsuits flew in the company’s face.

My client (a different chemical company) later had a similar explosion. The chief legal counsel called and stated that we did not want the fallout as from the other company. We therefore mounted a full-scope crisis management initiative that focused heavily on after-the-crisis help for the victims and their families. The goal was to keep litigation from occurring, which was met. At a later news conference, OSHA announced that it was assessing its smallest fine, as a result of the forthright way in which my client had handled the crisis.

Another energy industry client operated coal mines. The irresponsible actions of two employees thrust sludge from the mines and into the Cumberland River, which subsequently contaminated the water supply of three cities. The State of Kentucky filed suit, seeking criminal charges against the company.

Working closely together with legal counsel, our recommended crisis program posed an alternative to a worst-case sentence. The program, approved by the judge, consisted of TV and newspaper apology statements, plus the assurance that safety-environmental training would be provided to employees. An investment of $50,000 effected a reduction of the fine from $2 million to $500,000 and reduction of the charges from criminal to civil. Sustained follow-up communication with employees, customers, the court, regulators and opinion leaders ensued.

Another client was a large urban shopping center. Rapes occurred in the parking lot during the Christmas shopping season. Neighboring offices began e-mailing their friends, concerned that the center was unsafe.

Our strategy to address the crisis was three-fold. We engaged senior citizen volunteer corps and criminal justice students to wear Santa hats and serve as holiday escorts, assuring safety but not appearing as armed guards. Secondly, we initiated safety training that expanded to help home owners avoid accidents. Thirdly, the communications process served to glean research data that we needed to upgrade the center, its tenant mix and security issues. The common denominator was open communications with customers, where other retail centers try to stifle mention of incidents.

The process of strategy development is not esoteric. It is common sense, with an emphasis upon ideas that work and are easy to communicate. You always draw upon successful elements of other client crises. I had a restaurant chain attacked by an auto incident. Its family customer base was uneasy for their safety. We took the shopping center escort idea and translated it to senior citizen door greeters, armed with friendliness and the latest serving suggestions. Coupled with armed guards in parking lots, the approach was to reiterate the friendly, homey atmosphere, in contrast to the stereotype of sterile chain eateries.

There are three aspects to Crisis Management and Preparedness. First, qualified business advisors conduct Crisis Communications Audits. This securing and evaluation of programs needed or in-progress has enabled corporate management to make informed decisions, take swift action and avoid possible litigation.

Next comes Crisis Planning. This becomes a coordinated committee, with multiple departments and professional disciplines represented. What-if scenario planning is similar to the processes utilized in overall company strategic planning and visioning. The crisis plan must be part of the bigger process, not an adjunct or afterthought.

Finally comes Crisis Training. Activities include media-spokesperson training, field and operations staff training, coordination of corporate response and message points, community liaison, collateral materials writing-production, video archiving-production, media relations, monitoring and expert testimony. The crisis teams need to be prepared.

Crisis planning and strategies should be intertwined with security issues, financial goals, workforce empowerment and many other corporate dynamics. Elements which Crisis Management and Preparedness Plans should address, per categories on The Business TreeTM, include:

  1. The business you’re in (core business). Protection of intellectual property, materials, business continuity and core business production information. Prevention of theft, leaks in proprietary information and delays in deliverables.
  2. Running the business. Protection of physical plants, equipment, office files and other supplies. Prevention of unnecessary downtimes, spoilage, stoppage in processes and theft.
  3. Financial. Protection of fiduciary responsibilities and financial assets. Prevention of theft, embezzlement, accounting fraud and overpayments.
  4. People. Protection of human capital, knowledge bases of workers, executives, company safety and the work environment. Prevention of unnecessary employee burnout.
  5. Business development. Protection of company reputation, partnerships and alliances, marketplace intelligence and customer interests and relationships. Prevention of leaks in customer information and losses in company market position.
  6. Body of Knowledge. Protection of status and utilization of organizational working knowledge, management’s activities and relationships with regulators. Prevention of strains in company relationships with others and attacks from outside the organization.
  7. The Big Picture. Protection of the overall organization, compliance standards in the organization. Prevention of loss in quality, purpose or vision.

In times of crisis, take assessment of damages, and investigate the truth. Never exaggerate, speculate, or withhold information. No statements should be “off the record.” Provide complete answers, and respond to media requests for additional information in a timely manner. Failure to return calls implies something to hide. Maintain accurate records of all inquiries and news coverage.

The best way to build bridges is to seek out community opinion leaders and stakeholders before times of crisis. Educate them of your activities. Offer tours or community visitations to facilities. Provide printed information on your business… and a video, if at all affordable.

Test crisis plans during simulated drills, using qualified outside strategic planning consultants to evaluate results. Company officials should take these simulations seriously. The military does, terming them “war games.”

Part of being prepared is being engaged in routine activity. Have a plan in force, and be sure that every employee has a copy. The binder containing the plan should include easy-to-read fact sheets and backgrounders on company operations, current phone numbers, and a delineated line of authority (from company resource people to the spokesperson)

Crises can have many liabilities upon companies, including loss of profits and market share. Inevitable spin-offs include government investigations, public scrutiny, and a tarnished image. This causes loss of employee morale and, as a result, company productivity.

Crisis management and preparedness can minimize negative impacts of any emergency. Going through the planning and implementation is a quality assurance process that strengthens any company. Crisis communications means banking goodwill for those times when the plan is called to the test.

Crises of one sort can and will happen to every company. They can be turned from disasters into opportunities to project corporate strengths. The manner in which a crisis is handled often wins praise for companies whose positions are improved in the public eye. Those who are prepared will survive and thrive.

Defining Moments in the Corporate Culture

Volatile business contractions, uneasy economic climate, plant explosions, health care crises, hostile corporate takeovers, governmental shakeups, and financial failings are crises that upset the routine of business life.

Some jolting incident puts every organization into a reaction mode. The consequences of miscommunication in a crisis can be devastating to all involved. By dealing with the unexpected, preferably before it occurs, companies can bank public goodwill that may be useful later. Playing catch-up means that you have lost the game.

It is the responsibility of corporate management to practice effective Crisis Management and Preparedness. Management must study practical experiences of what can go wrong, put a crisis team into place, understand the workings of news media, identify community opinion leaders, and predict potentially harmful or controversial situations. Learn from those who were successful, those who failed to achieve the desired effects, and those whose corporate credibilities were damaged by inaction or the wrong actions.

Return to part 1 of 4.

About the Author

Power Stars to Light the Business Flame, by Hank Moore, encompasses a full-scope business perspective, invaluable for the corporate and small business markets. It is a compendium book, containing quotes and extrapolations into business culture, arranged in 76 business categories.

Hank’s latest book functions as a ‘PDR of business,’ a view of Big Picture strategies, methodologies and recommendations. This is a creative way of re-treading old knowledge to enable executives to master change rather than feel as they’re victims of it.

Power Stars to Light the Business Flameis now out in all three e-book formats: iTunes, Kindle, and Nook.

The Advisor’s Corner – Is Burnout a Reality?

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BurnoutQuestion:

Is ‘burnout’ a reality, or am I just being a whiner?

StrategyDriven Response: (by Roxi Hewertson, StrategyDriven Principal Contributor)

It’s true that burnout behaviors can look a lot like victim behaviors. However, burnout is a real state of mind and can be debilitating in many ways. If you are trying to decide whether or not you are simply whining or at risk of burnout, consider this: You know you are toast when you’re always exhausted, not laughing, highly critical or cynical, disengaged, or overwhelmed. We can burnout when we’re not feeling appreciated, when “it isn’t fair,” when work is meaningless, when we have values dissonance, and when we’re bored. Sometimes we can ‘manage up’ and work with our boss or manage differently with others to mitigate the root causes of our burnout. Sometimes, we just need to take control where we have control.

The best and fastest way to move from victim to victor is to take control. In our society, we have far more we control over our lives than we think we do. We control our attitude, behaviors, choices, what we say and do and to whom we say it. By strengthening and filling up our personal resilience ‘tank’ we can take back control over our lives one big or little chunk at a time. These are some relatively simple strategies that really do work. I recommend starting with number one and begin to add another and another without leaving any behind.

  1. Believe in yourself – remind yourself that you’ve solved many, many problems before and will do so again
  2. Identify accurately the root cause of your pain
  3. Reach out to others – it’s not a weakness to ask for input, and help from people you trust
  4. Find your empathy and compassion – acts of grace will change your body chemistry!
  5. Control instant gratification urges that cause you harm – mad shopping, eating, drinking, quitting in a huff…
  6. Stay calm vs. becoming reactive
  7. Laugh as much as you can in as many ways you can – movies, cartoons, jokes, friends… whatever brings you joy

Growing your resilience is a process not a trait. We’ve all bounced back from tough things in our lives, so you do know how to do it. The problem is, we forget our wins when we are feeling burned out. It’s time to remember how much you’ve achieved in your life and perhaps it just might be the right time to reimagine what will make you happy, including what is truly meaningful to you. Focusing on what IS working for you right now, and what you want in the future can help jump start your journey back into the light.

About the Author

Leadership authority Roxana (Roxi) Hewertson is a no-nonsense business veteran revered for her nuts-and-bolts, tell-it-like-it-is approach and practical, out-of-the-box insights that help both emerging and expert managers, executives and owners boost quantifiable job performance in various mission critical facets of business. Through AskRoxi.com, Roxi — “the Dear Abby of Leadership” — imparts invaluable free advice to managers and leaders at all levels, from the bullpen to the boardroom, to help them solve problems, become more effective and realize a higher measure of business and career success.

The StrategyDriven website was created to provide members of our community with insights to the actions that help create the shared vision, focus, and commitment needed to improve organizational alignment and accountability for the achievement of superior results. We look forward to answering your strategic planning and tactical business execution questions. Please email your questions to [email protected].

StrategyDriven Enterprises Extends its Advisory Services into the Healthcare Industry, Partners with Artower Advisory Services

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StrategyDriven Enterprises LLC and Artower Advisory Services, LLC partner to provide healthcare industry executives and managers with Affordable Care Act mandated Quality Assurance Performance Improvement (QAPI) program consulting services.
 
 
Healthcare ConsultingStrategyDriven Enterprises, LLC and Artower Advisory Services announced a partnership that will expand the regulatory compliance services of both companies. The relationship combines StrategyDriven’s leading experience in quality assurance and performance improvement regulatory services with Artower’s healthcare industry expertise.

“Healthcare industry leaders must find cost effective ways to meet the new quality assurance and performance improvement mandates of the Affordable Care Act,” explains Nathan Ives, StrategyDriven’s Chief Executive Officer. “We believe by leveraging experiences from other industries that for decades have complied with similar mandates, healthcare executives can not only meet and exceed these ACA requirements, but do so in a highly cost effective manner.”

“We are excited about the opportunity to combine StrategyDriven’s capabilities with Artower’s healthcare industry experience,” asserts Scot Park, Artower’s Chief Executive Officer. “This partnership will create out-of-the-box products and provide advisory services that enable healthcare organizations, both large and small, to rapidly achieve cost effective compliance with the ACA’s mandates while simultaneously driving improved patient care.”

The StrategyDriven / Artower team provides healthcare industry leaders with an array of actionable performance improvement and regulatory compliance support in the areas of:

  • Self-assessment programs
  • Corrective action programs
  • Organizational performance monitoring programs
  • Risk assurance programs

About StrategyDriven

StrategyDriven provides executives and managers with the planning and execution advice, tools, and practices needed to create greater organizational alignment and accountability for the achievement of superior results. We believe a clear, forward-looking strategy, translatable to the day-to-day activities of all organization members, is critical to realizing success in today’s fast paced market environment. Not only does a compelling, well-executed strategy align individuals to common goals, it ensures those goals best serve the company’s mission.

At StrategyDriven, our seasoned business leaders deliver real-world strategic business planning and tactical execution best practice advice – a blending of workplace experience with sound research and academic principles – to business leaders who may not otherwise have access to these resources.

StrategyDriven refers to the family of organizations comprising StrategyDriven Enterprises LLC. For more information, please visit www.StrategyDriven.com.

About Artower Advisory Services

Headquartered in Willoughby, Ohio, Artower Advisory Services’ professionals support healthcare industry leaders throughout the United States. The Artower team has expertise in senior housing, aging services, post-acute/long-term care, and behavioral health. Several of our senior professionals previously held leadership positions within major healthcare organizations. Artower’s project teams work collaboratively across disciplines to deliver greater value through improved outcomes, integrated delivery, and lower cost. For more information, visit www.ArtowerAdvisory.com.

Serve Memorably

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Think about the most memorable service you have ever received. Ever tell anyone about it?

Now think about the service you provide to your customers. How many people are talking about you?

ANSWER: Not enough.

Every time a customer calls it’s an opportunity. The only question is: how are you taking advantage of it?

Don’t answer with a “thank you for the call,” telling me how important my call is while you put me on hold for the next available agent. Or to “serve me better,” ask me to select from among the following eight options.

Selecting from among the following eight options is not one of MY options – and I have the money – and you want the money – and you need the money – so wise up.

The last things employers should cut are sales, service, and training. The FIRST thing to cut is executive pay, then management pay, then eliminate middle management as needed. OR MAKE THEM SALESPEOPLE, and have them contribute to the effort.

Meanwhile, customers need help, service, and answers. Your ability to help them in a timely manner, and serve them memorably, determines your reputation and your fate.

What actions are you willing to take? What investment are you willing to make? Do you understand it’s ALL about customer loyalty (not customer satisfaction)?

MAJOR CLUE: Keep in mind that no company ever CUT their way to success.

REALITY: You cut your way to safety. You have to SELL your way to success.

How ready are you?

If you want to win in this or any economy, you must be ready to win – ready with the right attitude, the right information, and the right service heart.

IF YOU BREAK THE SERVE MEMORABLY LAW: If a computer answers your phone, you have broken the law. If you use the word ‘policy,’ you have broken the law. Start there. The penalty for breaking this law is two-fold. Loss of reputation AND loss of customer. There are very few laws that have a higher penalty, and very few laws that are EASIER to fix. You don’t have to worry about monitoring your bad service. Your customers will do it for you, on Facebook and on Twitter. Your job is to fix it and continually improve it.

IF YOU FOLLOW THE SERVE MEMORABLY LAW: Your business reputation, both online and person-to-person, will soar! You’ll become known for taking ordinary daily business actions and turning them into pleasant customer surprises. The result is not just more business – it’s more loyal customers, more referrals, greater reputation, and more profit.

Think about that the next time you ask me to “select from among the following eight options.”

CAUTION: Ordinary, even polite, service is unacceptable. It will not give you the competitive edge or the business advantage that memorable service will.

At the end of any transaction, that’s when the customer STARTS talking about you.

They will say one of five things about what transpired:

  • Something great
  • Something good
  • Nothing
  • Something bad
  • Something real bad

And whatever they say leads to the next sale – either at your place, or your competition’s place.

The cool part is: you choose.

AHA! My ‘memorable mantra:’ Find something personal; do something memorable.

AHA! Grow from good, to great, to memorable.

KEY TO IMPLEMENTATION: Start with smart, happy people. Then define what is memorable and how everyone can achieve memorability with daily interactions (Southwest Airlines does it with friendly people and humor). Meet with all senior people and staff to create the ideas that wow, and gain the permission to wow at the same time. Then train AND empower everyone with specific phrases and actions they can take on behalf of customers.

Excerpt from Law 12: Serve Memorably from my Jeffrey’s new book, 21.5 Unbreakable Laws of Selling

Reprinted with permission from Jeffrey H. Gitomer and Buy Gitomer.

About the Author

Jeffrey Gitomer is the author of The Sales Bible, Customer Satisfaction is Worthless Customer Loyalty is Priceless, The Little Red Book of Selling, The Little Red Book of Sales Answers, The Little Black Book of Connections, The Little Gold Book of YES! Attitude, The Little Green Book of Getting Your Way, The Little Platinum Book of Cha-Ching, The Little Teal Book of Trust, The Little Book of Leadership, and Social BOOM! His website, www.gitomer.com, will lead you to more information about training and seminars, or email him personally at [email protected].

The Big Picture of Business – Achieving the Best by Preparing for the Worst: Lessons Learned from High-Profile Crises, part 3 of 4

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Effective Crisis Handling, Case Studies

Crises can and will happen to good organizations. Most often (85% of the time), they can be heeded, planned for averted. There is an art to Crisis Preparedness. It must be included as part of a formal Strategic Planning and Visioning process. So also should diversity, branding, quality, marketing, re-engineering and other important processes. No single facet of planning should be done out of sync with the others.

There will also be those unplanned crises that nobody could have predicted. The same planning process that nurtures Crisis Preparedness can and must also accommodate for Crisis Management. Many of the elements of planning strategies can be taken off the shelf and implemented when extreme danger presents itself.

The City of New York had conducted planning for multiple contingencies. Having done so put the city in the position of responding to the unthinkable on September 11, 2001.
Some of those events that had profound impacts upon us recently are examined in this chapter. In this section are examples of crises that were handled well, thus increasing public trust and respect for their organizations.

Product Recall, Tylenol. Several deaths occurred as a result of tampered Tylenol capsules. The company’s swift recall of product from the shelves and the timely response of the company CEO were part of the crisis plan that was in place well ahead of the tragedy. Johnson & Johnson quickly put its crisis plan into action and subsequently drew good reviews for its open communication with the public.

Tylenol mobilized public support, with the company also positioned as the victim. Seeking to facilitate U.S. Food and Drug Administration approval of the tamper-proof caplet, a public awareness campaign was waged. The next phase in restoring public credibility to Tylenol was the reintroduction of new product to the shelves, done in such a way as to restore consumer confidence and increase market share. This is regarded as a premiere textbook case of quality crisis management.

Product Contamination-Damage. Unrelated cases but both well handled involved Perrier Water and the Girl Scouts of America. Ground substances in localized batches of Girl Scout Cookies were contained effectively, thus having no adverse effect on the organization’s fund raising activities. Contaminated quantities of liquid resulted in a worldwide recall of product. Activities included crisis communications, grassroots lobbying, dealer relations, issues management, and the recently-completed successful market reintroduction of the product. Perrier utilized media opportunities to advocate for environmental protection and sought to educate consumers about product purification processes.

Reclaim Company’s Good Name, Chrysler bankruptcy. Going to the government and asking for bailout loans is quite chancy, as the airlines have learned recently. Automaker Chrysler was at an impasse in the late 1970s, facing competition and marketplace dominance from imported autos. From top to bottom, the corporate culture was overhauled. Fresh approaches were taken to getting out of the hole, putting emphasis upon quality in workmanship and moving the company forward. When so many companies today put forward a “branding campaign” and call it a change in focus, I laugh. Chrysler was one of the few to totally rethink and retool. Their success should be a beacon to companies striving to make the long way back.

Rebuilding Through Stakeholder Coalitions

Saccharine. In 1977, the federal government banned saccharine, claiming that it caused cancer. Producers of the product teamed together to form the non-partisan Calorie Control Council of America. Its members included physicians, researchers, diabetes support groups and nutritionists. The coalition fostered healthy lifestyles, rather than attack the government bad directly. The national credibility restoration campaign included crisis management, re-educating the public on the need for artificial sweeteners as part of healthy diets and government relations activity. By organizing business groups with citizens into CCC, this effort coalesced grassroots support, which caused Congress to overturn a U.S. Food and Drug Administration ban on saccharine, thus restoring the product to the market. Research denying its link to cancer and other promotional health aspects of the campaign served to return saccharine to credible common usage and create a wider market share for its uses as artificial sweeteners.

Maquiladoras. In the early 1980s, Laredo, Texas, was faced with a 28% unemployment rate. Devaluation of the Mexican peso and slumps in energy and ranching economies had taken tolls on a city whose population was losing faith. The decision was made to unify the community and actively go after manufacturers to relocate to the area.

Maquiladora is a Spanish word which means “made by hand.” The program offered tax advantages to assembly line manufacturers who either left northern factories or added additional installations on the Mexican border.

This unified business community effort, in response to a dire economic crisis, resulted in 63 major factories being built in Laredo, Texas, and Nuevo Laredo, Mexico, occupied by General Motors, Ford, Sony, Hitachi, JVC, 3-M, Stokeley Foods and others. The Maquiladora program lowered the unemployment rate from 28% to 13%. This industrial development program carried the theme, “You Can Believe/Puede Creer.”

Columbine. Following shootings at Columbine High School, the City of Littleton, Colorado, was in the media spotlight. Still a relatively new community, its right hand and left hand still were not fully acquainted. Uniting to bravely face the tragedy, the community found inner strengths and mounted a visioning program. Infrastructures were put in place. Quality of life issues were addressed. Economic development and community stewardship programs emerged. Out of the ashes of a school massacre came a community that created and nurtured strategies for the future.

Anti-Defamation League. Following shootings at a Jewish community center in Los Angeles, California, the Anti-Defamation League of America came together and launched positive community educational initiatives. Random acts of violence are certainly threats to all, and the ADL built broad coalitions in order to sensitize, educate and further bond communities. Inspirational forces like that built by ADL and other groups are most effective when they add constituencies outside their normal scope, building consensus of opinion and the strength of wider resources.

Continue to part 4 of 4.

Return to part 2 of 4.

About the Author

Power Stars to Light the Business Flame, by Hank Moore, encompasses a full-scope business perspective, invaluable for the corporate and small business markets. It is a compendium book, containing quotes and extrapolations into business culture, arranged in 76 business categories.

Hank’s latest book functions as a ‘PDR of business,’ a view of Big Picture strategies, methodologies and recommendations. This is a creative way of re-treading old knowledge to enable executives to master change rather than feel as they’re victims of it.

Power Stars to Light the Business Flameis now out in all three e-book formats: iTunes, Kindle, and Nook.