A crisis is sometimes a part of doing business in the modern, competitive market. Business crises can come in many forms—perception crisis, internal revolt, problems in the supply chain, and legal issues. Uber has recently demonstrated how quickly even the most successful company can come to the brink of collapse. Bill Busbice, who has spent decades as an entrepreneur, has experienced business crises more than once. Here is his advice on how to weather the storm and move a business forward when the unthinkable happens:
Investigate the Cause
Business crises can appear in many forms, therefore it’s important to investigate what has gone wrong. Doctors can’t prescribe a treatment without diagnosing the disease. The same logic applies to fixing a major company problem. Mr. Busbice emphasizes that keeping a clear head is important to pinpoint exactly what is wrong. Once that is done, the business can start getting in position to address the issue.
Don’t Be Afraid to Fire Leaders
If the company’s problem is a CEO problem, as it was in the case of Uber, then don’t hesitate to fire the CEO and hire a new one. Many businesses don’t want to go through structural changes in times of crisis. However, it may be exactly what the company needs. In the case of Uber, the company voted in a new CEO Dana Khosrowshahi. It was not an impulsive decision by any means. Khosrowshahi has over a decade of experience as the CEO of Expedia. During his tenure there, Khosrowshahi showed “extraordinary business savvy” for growing revenue, Mr. Busbice says. It was the right move for Uber to reshuffle leadership and head in a new direction. Likewise, other companies should consider finding new leadership to steer the ship away from the storm.
Apologize to Customers When Necessary
Taking a stubborn, defensive stance against a public relations crisis can be more counterproductive than useful, warns experienced CEOs. If the disaster calls for apologizing to the customers, then it should be done. For example, Under Armour did this in 2014, when the winter Olympics outfits the brand created were blamed for athletes losing medals. Under Armour didn’t shuffle its feet and delivered a swift response promising to make the suits better. There was no back and forth with the accusers, so a potentially even worse crisis was avoided. The company soon signed a new sponsorship deal and moved on. That’s exactly what other companies facing similar perception crises should do. Don’t play a blame game in public.
Companies should never go radio silent during a time of crisis, experts caution. Communication is very important to taking control of the narrative as the crisis unfolds. The business should communicate with internal stakeholders like shareholders and investors. Then the business should stay in touch with customers to assure that the company is taking the problem seriously. Good communication will prevent the brand’s reputation from being damaged beyond repair.
Good leaders anticipate a crisis in advance, says Mr. Busbice. Have a plan ready to address a potential disaster to help prevent a big problem from turning colossal.