Dealing With A Crisis

This week the Bumble Bee tuna cannery in Puerto Rico closed down after 50 years, leaving 181 people out on the streets. This, of course, was overshadowed by the news of UBS with two accounts of fraud by the Securities and Exchange Commission.

Crises happen often, what doesn’t happen that often are Financial Crises. I’ve had the opportunity to work closely with the Crisis Communications Plan for the close down of the Bumble Bee cannery. We had business reporters and bloggers wanting to know the financial facts of the situation, such as: number of employees that will be left without a job, reasons for leaving, recent financial statements, and how could this impact the economy on the Island. Now, I’m not the most knowledgeable person when it comes to finance so I had to treat it like a regular crisis management, which still left some inquirers, but it got the bases covered. The trick to manage a financial crisis is to be knowledgeable in both crisis management and finance. So, if you’re a wiz in the financial department, here are a few tips to better manage an unwanted situation.

First of all you have to be conscious of three points when an unexpected situations rises:

• Audience: identify if it’s a public or internal crisis, and which groups are affected the most.
• Timing: you must respond immediately. Leave no room for speculation.
• Content: the purpose is to quell, and if you can, reverse negative attitudes and behavior.

In any way that you can, it is recommendable to develop a Crisis Management Plan. I know what you’re thinking; if a crisis is an unexpected situation, how can you plan for it? Well, if you do a company risk analysis you can be aware of possible situations a better plan for them. In the case of Bumble Bee, they already knew the plant was going to close down and they made a plan that assessed the workers first and foremost, and an hour later the media outlets.

To better plan for a crisis there are five stages:

• Detection: watching for signs.
• Preparation: for a proactive or reactive response.
• Containment: limiting the duration of it.
• Recovery: the return to normal.
• Learning and Evaluation: to prevent or better deal with future crisis. 

Even when you have the stages figured out that doesn’t mean everything will go according to your plan. You may be asked to give an opinion on the matter, but if you were not planned to give statements you should never make one, and always direct that person to the indicated official. To prevent unwanted inquiries, and to better educate people on what’s happening, the most important tools are all the material you put out for your public’s reach. This means that special attention must be put to the written materials to be handed out.

Here are some strategies to keep in mind when writing for a crisis:

• Establish a clear position: you must determine a clear message to be carried out to all media and audiences. 
• Honesty is the best policy: it is not an option to lie.
• Work with your media friends: contact the reporters that have worked with your company and know it better.
• Make assets available: be prepared to hand out fact sheets, financial statements, backgrounders, among others.

Being aware of every aspect of the company and what people are saying in the news and blogs plays an important part on how you decide to manage a financial crisis. Work closely with your CFO, Accounting and HR departments to better handle the situation. When managing the closing of Bumble Bee we had the luck that representatives from Ikea were on the Island striking a deal to bring the chain to Puerto Rico. We have very sensationalist media…so the news just blew over in a day.

Sources:


Kantow, M. (May, 2012). Bumble Bee Closing Mayagüez Palnt After 40 Years, Leaving 200 Jobless. News Is My Business. Retrieved from: http://newsismybusiness.com/bumble-bee-closing-mayaguez-plant-after-40-years-leaving-200-jobless/


Kantow, M. (May, 2012).SEC Charges UBS P.R., 2 execs with fraud. News Is My Business. Retrieved from: http://newsismybusiness.com/sec-charges-ubs-p-r-2-execs-with-fraud/


Treadwell, D., & Treadwell, J. (2005). Public Relations Writing: Principles in Practice.California: SAGE Publications. 


Bernstein, J. (1996). The 10 Steps of Crisis Communication. Bernstein Crisis Management. Retrieved from: http://www.bernsteincrisismanagement.com/docs/the_10_steps_of_crisis_communications.html