Every day there are myriad stories in the news about companies dealing with a crisis situation; many more never make a news broadcast.
Missed earnings, resignations, down cycles, layoffs, funding issues (especially for startups) offshoring, and board shifts are all crisis situations that can stay ”inside the tent” with the correct steps.
1. Develop Relationships with Board Members, Investors, and Others BEFORE a Crisis Situation or Bad Bit of News. This may seem like common sense but can often get pushed to the side in favor of day-to-day responsibilities that yield immediate results. The reality is it is much easier to communicate bad news to someone who is used to hearing from you regularly than someone who hears from you once a quarter. Another caveat – sometimes Board members can be the best advocates a company can have during a tough quarter or during a crisis; however, one of the keys to having effective advocates is regular contact and flow of information.
There is a reason why some of the greatest political leaders of our time continue to make phone calls and write notes to key supporters during off years, long before election season is looming on the horizon.
2. Communicate More Often. There is a tendency when times are good and everything is running very well to communicate a little less. Yet, this is the time to communicate more, and not just at monthly meetings, especially during tough economic times, which can easily lead to a crisis. Yes, this is a bit counterintuitive as a CEO wants to spend as much time as possible “adding value”; however, I would argue that keeping investors and board members active, involved, and included (rather than frustrated) adds as much value as anything else.
3. Communicate Regularly. One technique that works well is sending weekly e-mail “Updates from the CEO” that consist of a paragraph or two delivered weekly or bi-weekly, internally, with the high and low points for the company. Why? It reinforces the message of engagement with the board and investors, by getting the board in the habit of receiving regular correspondence outside of when they are “supposed” to get it. This is a great initial step.
4. Pick up the Phone. Call your investors and board members regularly. They might be too busy to take the call. Call anyway. They may tell you that you do not need to call. Call anyway.
At the same time, the last thing any executive wants, or can afford, is to only focus on investors and board members. Equally important is communicating regularly throughout the organization, which leads to Pt. II…