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Guest: Tracy Williams, the founder of Olmstead Williams Communications, which is an LA-based public relations, crisis communications, and issues management firm. Tracy is also a client of CEO Coaching International.
Episode in a Tweet: Disaster for your company could be just a tweet away if you don’t have a crisis management plan in place.
Quick Background: In this age of social media and internet activism, lots of top CEOs have Tracy Williams on speed dial for when a crisis hits, or a lawsuit threatens a company’s brand or reputation. Even companies that are vigilant about living their values, following best practices, and creating a healthy workplace culture are vulnerable to the wrath of online mobs if they don’t have an action plan in place when inevitable misunderstanding or slipups do occur.
On today’s show Tracy Williams discusses reputation management in the age of social media, particularly how to protect yourself and your company from a PR disaster that could explode as fast as a tweet.
Transcript: Download the full transcript here.
Key Insights on Crisis Management from Tracy Williams
1. Don’t assume you’re safe.
In these polarizing times, someone somewhere could find a reason to get worked up about your business, even if you haven’t blundered big like Starbucks did earlier this year.
“What I see is companies are doing nothing and they’re still getting into trouble,” Tracy Williams says. “They could be running advertisement on Fox News, which they have to do in order to get their customers, and then customers on social media are appalled where they’re advertising and that company needs to pull the advertising. Social media blew up with Microsoft employees saying they have to pull their software for ICE in this era of zero tolerance and the family separation at the border.”
To be clear: Tracy isn’t making any political judgements, and neither am I. But your customers and online activists are, all the time, sometimes for justifiable reasons, and sometimes not. What you consider an innocuous sale or pro-growth partnership might bring out the pitchforks for reasons you never expected.
“It used to be that you wouldn’t take a stand,” Tracy says. “You would just go and operate your business, but now there is no neutrality. You are taking a stand if you’re doing business with somebody that somebody doesn’t think you should be doing business with.”
2. Know your risk areas.
As the CEO, it’s your responsibility to know everything about your business space, and more importantly, to know what you don’t know and fill those gaps. That goes double for your crisis management game plan. “It’s so important when companies are thinking about their communications, their market, their brand, and their reputation, that assess all of the areas of risk,” Tracy warns.
To identify some key potential risk areas, ask yourself:
- What government regulations or new laws might affect your business or how the public perceives it?
- What is your relationship like with the community where you operate?
- Are you working with any overseas suppliers or partners who might be controversial in the US?
- What does your Glassdoor rating look like? Are current and former employees positive or negative about your workplace culture?
- What do your customers say about your business on review sites like Yelp?
Now obviously online ratings tend to skew negative, especially if ex-employees carrying a grudge or dissatisfied customers distort your numbers. But your online reputation does matter. Address any negative comments that ring true and make a list of actionable steps that can reduce your risk factors in other important areas.
Tracy also recommends drafting holding statements that lean on emotion and feeling words to help shorten your crisis response time. “Used to be companies believed that they should respond within the day,” Tracy says. “But social media, media, and customers want a response within minutes.”
3. Put the C-Suite in command.
Tracy says the core crisis management problem she sees with companies right now is an unclear chain of command. It seems pretty obvious that weathering major storms should be the CEO and C-suite’s responsibility. So why do so many companies struggle with this vital piece of organization?
“CEOs and the C-suite, they’re busy moving that ball down the field,” Tracy notes. “It’s optimism, it’s positivity, it’s taking risk. Sitting back on your heels to go through a risk assessment can be very painful, because it feels paralyzing in an environment where you’ve got to have people being aggressive and optimistic.”
The CEO and C-Suite need to manage a crisis from the top down. The more transparent you are with key staff, employees, and, if necessary, law enforcement and attorneys about what’s going on, the more effective your response will be.
4. Live your core values.
Here’s a real eye-opener: Tracy says that your company’s reputation accounts for 60% of its market value. That’s why Starbucks was willing to lose millions of dollars in revenue to close all of its stores and address racial sensitivity issues. That’s why Dick’s decided stricter gun-sales policies outweighed a potential dip in total sales. Politics aside, these companies decided what was important to them, and made decisions that strengthened how the public perceived their brands.
Most companies won’t have to take stances on that large a scale. But the values that the CEO sets for a business of any size can be the difference between growing BIG and dying under the weight of a bad culture and a bad reputation. Cash grabs that hurt your brand aren’t going to attract value-conscious millennial customers. Top talent won’t want to work in an office that has a reputation for being a boys’ club. Sweeping bad news under the rug isn’t going to motivate employees to excel.
Of course, a special level of brand responsibility falls to the CEO. According to Tracy, new studies show that 49% of the reputation of a company is attributed to the reputation of the CEO.
“We have to live our values,” Tracy Williams says. “We have to do the right thing, and we have to be prepared to do the right thing.”
1. Business is no longer neutral. Set your own opinions and politics aside when considering all potential risk factors involved in your operations.
2. Put your brand before your bottom line. If your brand turns off your customer base they’ll take their business – and your profits – elsewhere.
3. Let your values lead you to best practices and good partnerships that will keep your risk levels low.
Transcript: Download the full transcript here.