Jill Schmidt, executive vice president and corporate practice chair at Carmichael Lynch Relate, talked to Twin Cities Business about how to navigate crisis communications in honest, authentic ways. The article originally appeared in the April issue of Twin Cities Business magazine.
Boeing grounded its best-selling commercial plane, the 737 MAX, in March 2019 after Ethiopian Airlines Flight 302 crashed six minutes after takeoff from Addis Ababa, resulting in the deaths of all 157 people aboard. Just five months earlier, another 737 MAX, operated by Indonesia-based Lion Air, plummeted into the Java Sea near Jakarta, killing all 189 people on board.
If anything deserves the name “business crisis,” the 737 MAX debacle is almost a custom fit. The deaths are the worst part, but the crisis certainly hasn’t stopped there. In early January, internal Boeing emails revealed that there long had been grave concerns in the company about the plane’s design flaws and how they were being addressed. Company leaders appeared to have suppressed vocal concerns or minimized the substantive problems that had been identified.
The fire is still blazing. Chicago-based Boeing, which in 2019 posted its first annual loss since 1997, will have to spend nearly $20 billion to fix the 737 MAX. Meanwhile, suppliers are losing millions of dollars in revenue. The crisis also brought down CEO Dennis Muilenburg, who was fired in December.
Dave Calhoun, Muilenburg’s interim replacement, announced in January that Boeing would restart production on the 737 MAX this summer. That doesn’t guarantee, however, that the Federal Aviation Administration will allow the planes that have been taken out of service to be airborne within the next few months.
“Boeing is the latest large organization with issues related to breaching the public trust,” notes Matt Kucharski, president of Minneapolis-based public relations and communications agency Padilla. Citing other recent examples that involved Volkswagen and Wells Fargo, Kucharski notes that “people assume that a crisis is going to happen only to a large organization.” But smaller companies shouldn’t get complacent. “This isn’t a matter of if a crisis is going to happen,” he warns. “It’s a matter of when.”
The scale of most companies’ crises won’t match that of the 737 MAX. But they still can put the business at risk—and potentially cause permanent harm. How a business responds to a crisis speaks volumes about a company’s competency and ethics. The response determines whether a business comes through the crisis with its reputation intact, or whether it’s damaged, “perhaps irreparably,” Kucharski says. “The last time you want to be thinking how you’re going to handle a crisis is when the crisis is actually happening.”
Nonetheless, there’s a surprise element to every crisis, says Bloomington-based crisis communications consultant James Lukaszewski, whose career spans more than four decades. “In many cases, the organization itself is primarily responsible for the problem,” he says. “It’s not the actual circumstance. Their response creates more problems for them than they would have had if they’d just reported themselves and said, ‘We’re going to fix this.’ ”
Companies of all sizes can learn from the Boeing case. If a crisis or potential crisis rears its ugly head, it’s crucial that a company respond promptly and with care. In the digital age, when crises arise, they can blow up quickly.
Mediating a crisis
Jill Schmidt, executive vice president and corporate practice chair at Carmichael Lynch Relate, keeps close tabs on business crises. Though she’s quick to note that the 737 MAX case is one she’s observed as an outsider looking in, the public reports she’s read led her to conclude that Boeing’s handling of the situation probably exacerbated the issue. How? Essentially, by not being forthcoming. Boeing attempted to deflect the connection between the two crashes and technical problems in the 737 MAX’s software. Instead of addressing the concerns of pilots and potential passengers, the company shifted the blame to pilot error. “It seemed like they weren’t necessarily taking the situation seriously enough, soon enough,” says Schmidt, a key leader in her Minneapolis-based public relations firm. Boeing “seemed to focus on the technical aspects of the situation, but what it was ignoring was the court of public opinion,” she says.
That court increasingly has been convening on social media. That reality doesn’t minimize the crucial role of the reporting done by journalists; but it’s the discussion among dozens, hundreds, even thousands of people that can turn a news report into a full-blown scandal.
“Every crisis is online,” crisis communications expert David Krejci says. “If it’s not online, it couldn’t possibly be a crisis. If it’s not being discussed on the internet, then it is simply not of a magnitude that you could even call it a crisis.”
Few companies will have to deal with a 737 MAX-size problem. But many are confronting static online. Sometimes it’s an unhappy customer. Other times, it involves a controversial social issue, such as an accusation that a business is insensitive to a particular group or community.
In February, Krejci left his job as executive vice president, digital crisis and issues, of the Minneapolis office of communications firm Weber Shandwick to launch his own online-communications consultancy, MediaForensics.org. At Weber Shandwick, Krejci and his team helped clients determine whether online comments truly signified a problem or were provocations of troublesome trolls.
“You have to discern who the parties are that are upset and what their motives are,” Krejci says. “If their motive is simply to cause disruption for the sake of disruption or just having what they think is fun, there’s no reason to engage in a conversation with them.”
You have to discern who the parties are that are upset and what their motives are.If their motive is simply to cause disruption … or just having what they think is fun, there’s no reason to engage in a conversation with them.
That advice noted, sometimes a business needs to confront the troublemaker. Over the past few years, several companies have responded to posted videos that purport to show the business doing or supporting something nefarious.
“To come out and make a statement on social media that this is not a real video … becomes a he-said-she-said, and anyone with a bias gets dismissed,” Krejci says. “So rather than the client coming back and saying, ‘This is fake,’ what we endeavor to do is get the community of conversation happening.” He argues that it can be quite effective to simply let people identify what they’re seeing online is fake.
“There is so much talk about social media being the beginning and end of everything,” Krejci says. “It really isn’t.” Traditional news media, after all, remains the source of most online conversations, and it still has the kind of credibility that social media can’t match.
Notes Krejci, “Nothing better can happen than the media calling and saying, ‘What about this video?’ and the client saying, ‘It’s fake—here’s proof.’ Then a news story gets shared on social media saying, ‘This is a fake video.’ ”
In such situations, journalists focus on getting the facts and separating the truth from fiction. Often consumers who are loyal to a given company will then choose to share links to legitimate news coverage.
“One of the practices we recommend: Build your community ahead of time,” Schmidt says. If a company’s products or services have a good reputation with customers, then brand advocates will come to the aid of the business if an issue arises on social media, she says.
A big part of maintaining a strong online community is being social oneself. According to social media research gathered by Carmichael Lynch Relate, 90 percent of people on social media use the platform to communicate with a brand or a business. “What’s also interesting is that 63 percent of customers expect companies to offer customer service directly through their social media channel,” Schmidt says. In addition, 42 percent expect a response within an hour, 32 percent within 30 minutes. If a company doesn’t respond quickly or at all, it’s not only the disgruntled customer who will know about it. So will other online followers.
When employees are paid to carefully monitor online conversations about their company, they are fully aware of what customers are discussing and the company can address key concerns before an issue develops into a crisis.
Preparing for the unexpected
When a business crisis erupts, communications experts advise promptness and directness in company responses to customers and the general public. “You have to develop messages that expose the facts and exhibit genuine sympathy and empathy,” Krejci says. “If there’s a need for regret or an apology, show remorse and regret in a really genuine way.” Part of the art of crisis communications, he adds, “is speaking so clearly about complicated situations that everyone can understand it, and doing so in an honest, authentic way.”
Communications professionals speak of the need to be prepared, and companies should have plans for relatively “predictable” types of emergencies—fires, chemical spills, and the like—that could have an impact on customers and communities. Yet there are plenty of other crises that make news headlines with regularity: workplace violence, sexual harassment, data breaches, and employee malfeasance.
Kucharski offers an example of an unpredictable crisis. His scenario involves a company that makes pet food. It discovers there’s an online rumor that a carcinogen has been found in a product—and the rumor has gone viral.
Kucharski breaks down how to respond to this challenge. First, determine whether there might actually be carcinogens in the product. “You might find out that this isn’t a social media problem, this is a manufacturing problem,” he says. “So make sure you’re addressing that first, and then address the social media component.”
Every crisis, he adds, “has both an action and a communication element to it. The communication element is driven by the action element. Bad things happen, people hear about it. You solve the problem, [then] you tell people about it.”
When a potentially damaging crisis occurs, many companies might think the best way to respond is to have the company’s legal counsel craft and release a statement. While that is likely an important consideration, in 2020, communication experts say, that action is unlikely to be effective, particularly on social media.
“If [the crisis is] happening on Facebook, you can’t put out a very formal media statement on social media very effectively, because you will get ripped apart for talking like a lawyer,” Krejci says. “That’s not being dismissive about lawyers. It’s just the wrong platform.” If a business is responding to an issue or crisis on Facebook, the person representing the company should use language that is more direct and casual than wording often used in legal statements, he says.
Padilla’s Kucharski prefers to use the word “protocol” to describe how to handle a crisis. A protocol is a flexible response approach that can be activated whenever something unforeseen occurs. It can specify a crisis response team—a group of employees, perhaps paired with an outside communications agency with crisis expertise—and have guidelines for how to respond. The written protocol should be reviewed and updated regularly.
“One of the things that’s important for companies to be mindful of is not believing that you control the timeline in a crisis,” says Ayme Zemke, senior vice president of client service for St. Paul-based Beehive Strategic Communication. “A crisis moves at the speed that technology allows, and that’s real time. A crisis waits for no company.” Companies should not expect things to just blow over. “In a crisis situation, you have to engage,” Zemke says. And engage thoughtfully.
That’s because people expect more from businesses, she adds. “They expect them to stand for something—something more than profits. There is a rising expectation around transparency.” In the case of Boeing, Zemke says, “the company was very focused on completing orders and making a profit in this particular scenario. Airplane failure is certainly a risk factor for a company like Boeing. With this particular airplane, Boeing made an intentional business decision that put them in a risky position.”
All told, Zemke says, “I think the marketplace is going to have a difficult time with Boeing because they made a very intentional choice that broke the trust of all of their key stakeholders, including their customers and pilots.”
Businesses can’t avoid all crises. But by building a culture of responsibility, transparency, and empathy, and acting on those values, a company can respond effectively—and prevent a crisis from causing severe damage to the business.