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...response that will leave stakeholders with favourable impression and renewed confidence in the affected company.
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Few circumstances test a company's reputation or competency as severely as a crisis. Whether the impact is immediate or sustained over months and years, a crisis affects stakeholders within and outside of a company. Customers cancel orders. Employees raise questions. Directors are questioned. Shareholders get antsy. Competitors sense opportunity. Governments and regulators come knocking. Interest groups smell blood. Lawyers are not far behind.
As the ultimate unplanned activity, a crisis does not lend itself to conventional "command and control" management practices. In fact, some of the techniques for managing a crisis may fly in the face of conventional notions of planning, testing and execution. Preparation and sound judgment are critical for survival.
Since the Tylenol crisis of the 1980s (unknown parties tampered with bottles of the product), the concept of crisis management has become a specialized activity in the domains of communications and public relations. Companies have come to recognize crisis communications capabilities as a vital part of their risk management and business continuity strategies.
National Public Relations has been on the front lines of some of the highest-profile crises in Canada and beyond, for more than 30 years. We have devoted many more hours to helping companies avoid, manage and recover from a crisis. This article encapsulates our strategy for survival.
1. Crisis prevention: The case for issues management
The first task is to identify crisis risks or to recognize a crisis when it breaks out.
From a communications standpoint, a crisis is a business or organizational problem that is exposed to public attention, and that threatens a company's reputation and its ability to conduct business.
A crisis can take on many forms, including natural or man-made disasters, environmental spills, product tampering or recalls, labour disruptions or criminal acts, to name a few. What makes them a crisis is the fact that they are the focus of intense media scrutiny.
Although some risks are beyond a company's control, others can be foreseen. Research shows that the vast majority of crises arise when companies fail to identify a potentially contentious issue at an earlier, more benign, stage, and to develop a plan of action to manage the issue before the issue manages them.
An issue can fester for months, maybe years, until events and circumstances intersect and propel it to centre stage on the public agenda. In some cases, an issue may have been badly handled, and as a result, has escalated to the brink of becoming a crisis. Examples include:
* A major pharmaceutical company recalls a product that has...
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