Business reporters and IR departments are busy these days. From bankruptices to layoffs, investment schemes and more, the news is deluged with stories of missteps and failures that reap untold damage onto companies and their employees.

CFO Crisis Communications2013 Executive Communications Workshop, our panel of experts shared their own personal challenges and triumphs in crisis communications, and shared their own best practices for CFOs to ‘get ahead of the news’ while successfully managing the needs of their employees, executive team, board and more.

Our speakers included:


Tip #1: Have A Plan

In times of crisis, the last thing anyone wants to do is scramble to answer “What do we do?” However, when polled, less than ⅓ of our audience had a known crisis communications plan or policy.

Of course, the best time to plan for a crisis is when there is no crisis underway. The panel agreed that a crisis communications plan should not be overly complicated. Rather, this plan should be straightforward, employ common sense, and empower your team to think on their feet and react immediately.

The essential components of the plan include a fact-based outline of the crisis as you know it, and a list of the personal phone numbers of your senior leadership team so they can be reached and alerted immediately.

Your crisis communications plan also shouldn’t be hard to find. For example, McCarthy employs the ‘Red Binder’ rule, meaning that every member of his senior leadership team has a red binder in their office, the contents containing the crisis communications plan. Warner makes sure that every senior member of her leadership teams carry a wallet-sized crisis communications plan, phone numbers included, so they always have immediate access to the plan.
 

Tip #2: Get The Facts

The normal day-to-day of business is hectic enough. Throw a crisis in the mix, and everything moves faster than the speed of light.

In the immediate wake of a crisis, it is absolutely critical to collect the facts, and get them right the first time. After all, as the panel stated, it is impossible to manage the situation if you don’t understand it. The most important questions to answer immediately include:

  • What happened?
  • Was anyone hurt?
  • Who or what was involved?
  • What is the current state of the situation?

Once these questions are answered, immediately brief your senior leadership team, starting with the CEO. As the CFO, you are the natural hub of communication for your company, and the ‘keeper of the facts.’ As more data is revealed over time, continue to brief your senior leadership team on developments and potential long-range impacts of the crisis on your company.

In fact, the majority of the panel agreed that they couldn’t manage the story without the data and facts as supplied by the CFO. As McCarthy discussed when outlining a past experience, “The CFO played an invaluable role when we were managing our crisis. We already had the data and worked with our committees, and we knew that our data and facts were 100% accurate. The last thing you ever want to do when heading into any type of media situation is to be either unprepared or have bad data.”
 

Tip #3: Know Your Spokespeople

In spite of your corporate hierarchy, not every situation requires the voice and presence of the CEO. In fact, Warner stated that her team sometimes prefers not to put the CEO out in front of a negative story, as it might needlessly harm their name or corporate image. Of course, this decision is made on a case-by-case basis.

It was also noted that the CFO is rarely made a spokesperson. In fact, Howe reviewed his coverage for the past few years and determined that the only CFOs he mentioned or quoted in his coverage included either those who were involved in large-scale scandals (Enron, Worldcom, etc.), or those who were being publicly groomed for a CEO position.

Regardless of whom serves as spokesperson, the whole panel agreed that no company should have one spokesperson alone. Rather, companies should train multiple members of their company to work effectively with the media in the case that their primary spokesperson isn’t available.

And it happens. After all, crisis does not care if you’re on vacation, if you’re in the middle of your annual audit or on a roadshow. Crisis happens anytime, anywhere. And the worst thing you can do is make the media wait. Howe offered this example “Say one of your facilities has a 2-alarm dumpster fire and the media calls for comment. At the same time, your CEO, the only approved spokesperson for your company, is on an 8-hour flight to London, and is completely unreachable. Suddenly that routine story of a dumpster fire turns into something bigger because all the media hears is ‘No comment right now.’ The story will move forward, with or without you.”
 

Tip #4: Know Your Media

There are a basic set of rules to keep in mind when you’re working with the media, which include:

  1. Tell the truth
  2. Be succinct
  3. Don’t delay

Seems easy enough, right?

While the size and scope of the crisis will dictate the type of media you’ll work with, any solid communications plan will include media training for all spokespeople (and that’s not just the CEO!) The panel also offered this advice for CFOs, whether or not they’re media trained “Show patience with questions, and always spend the time needed to make sure the media gets all the answers they ask for. The worst thing you can do is give a statement and walk away. Ultimately, show respect, and you’ll be given the same.”

Another interesting discussion from the panel included the role of social media in crisis communications. While tongue-in-cheek, the panel agreed that “Social media is speed, innaccuracy and emotion in action, all of which can reign supreme over fact.”

When dealing with social media in times of crisis, it is recommended to handle the platforms judiciously and with caution. While the panel did agree that social media can be a powerful and open line of communication with their customers, they also advised CFOs to ensure that their corporate communications department is well versed on how to effectively manage and neutralize potentially toxic discussions or commenters.
 

Tip #5: Get Help

Howe summed this up perfectly: “Crisis communications is like electrical wiring. Unless you are a certified professional yourself, you need to get help.”

As we have seen in recent years, crisis comes in all shapes and sizes, and must be approached with caution and clarity to be effectively managed. And while companies have senior leadership teams who manage day-to-day crises, it’s the ones that spiral out of control, or come out of nowhere, that hobble a company for days, weeks or even months on end.

Did you know that CFO RoundTable members meet monthly on this topic and more? Learn more about our membership benefits today:

 

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