The Art of Crisis Communications: Have a Plan but Keep it Simple

For this week’s blog, I asked longtime PR pro, Staci Busby, to share her insights on crisis communications, a very important topic that inevitably must be faced by all companies and their communicators.  With more than 20 years working in corporate, non-profit and agency environments, Staci Busby is an accredited Public Relations Counselor who has led crisis communications teams through a variety of issues and crises, ranging from employee murders, picketing and triple swipes on debit cards to E. coli poisoning, natural disasters and significant layoffs.

Oil spills, toxic sludge slides and mine disasters… now what? We’re confronted with major disasters regularly. How we handle these crises for our employers can make or break their reputations.

It’s always interesting to read the opinion pieces after a catastrophe occurs. “I would have done this.” “They should have done that.” The truth is we all would do better in hindsight. So the best we can do is learn from our experiences and mistakes, (ours and others), and be as prepared as possible when a crisis does hit.

Although in a crisis situation we’re usually forced into a reactionary mode, it is possible to plan ahead by creating a basic process to follow so that you are not blindsided when a tragedy occurs. I’m not an advocate for filling your bookshelves with plans for anything and everything that might happen, but I do believe it’s important to brainstorm possible threats and develop a simple guide that will help you and your company endure potential crises.

You may find volumes of valuable information to help you predict, plan, practice and prepare for the unthinkable; but it’s rare to find a simple, practical guide to use once a crisis hits, so here are a few simple tips to keep in mind.

  1. First, when a crisis hits, take a deep breath and clear your mind so you can focus on the specific issue you are facing and determine its magnitude.  It’s hard to think during a crisis, particularly if people are injured or killed. Use the simple guide you’ve already developed to help you focus on steps that need to be taken.
  2. Next, gather the facts and develop key messages. Uncover the who, what, why, when and where of the crisis – without speculation, rumor or innuendo. Then, flesh out the basic messages regarding the situation.
  3. Third, identify key audiences (investors, employees, customers, any government officials, media, etc.) that need to be informed. You can tailor your messages to the relevant audiences based on what is most important to them. For example, if a crisis occurs that is not publicized by the media, you may still send a letter to employees explaining the situation. However, it’s always important to be prepared to respond if the press becomes aware of the situation, or you may choose to work with key members of the media to disseminate your message to a particular audience.
  4. Next, identify a limited number of spokespeople, ensure they are familiar with the issue and prepare them to deliver the key messages. Consistent messages are critical because they can minimize confusion and help an organization maintain credibility during an emergency or crisis situation. It’s essential that the spokesperson represent a unified voice for the company.
  5. Determine the most effective method of communicating to each audience. A letter or e-mail to employees may be the best way to handle an internal issue. However, if it is an issue with public consequences, you may decide to respond with a written or verbal statement delivered by an authorized spokesperson. When contemplating the method of communication, always consider the extent of the situation, the audience and the impact it may have on the company.
  6. Now, communicate. How, what and when you communicate to whom can affect the impact of the situation, positively and negatively. The quicker you communicate clearly to your selected audiences, the fewer rumors you have to dispel. Quickly communicate how the crisis will be resolved and what steps you will take to prevent it from happening again. If the resolution is a long process, offer some checkpoints as to when you’ll be   updating your target audiences about your company’s progress.
  7. After the initial response, remember to monitor the results of public statements. What is being reported? How are employees/customers/investors feeling about the crisis? Are your messages being delivered? Are questions being answered? If your messages are not clear, or are misinterpreted, you may need to adjust the statements accordingly. Stay on top of how the media reports the crisis. Be sure to correct factual errors quickly, so that they are not repeated. In the age of social media, it’s important to have a way of monitoring online chat and responding via selected channels if deemed appropriate.
  8. Assess initial reaction to the crisis and review new information. Once the heat of the moment subsides, the tendency is to move on to other business matters. While the end goal is to resume normal business operations, it is important to stay with a crisis situation until it has been resolved completely and there is no new information to report. Crises often evolve, so you should continue to review communications until the threat and discussion subside completely.
  9. Next, determine whether additional communication is needed. Think about employees, customers, investors and other audiences who may take comfort in receiving an official communication informing them that the situation is resolved.
  10. Finally, remember to evaluate the effectiveness of your crisis communications process by asking these questions:
    • How can we prevent this from happening again?
    • How can we improve the crisis/issues management process?
    • What went right? What went wrong?
    • How should we revise our guide based on what we’ve learned?
    • What did we need at our fingertips that wasn’t available?

This is where “I should have; I could have” comes in handy. Learn from each issue or crisis and apply those lessons to your ongoing planning process.

Remember, it takes years for a company to build a solid reputation and seconds to destroy it. When a crisis hits, the people involved in handling the fallout have very little time to think and often have difficulty thinking clearly, depending on the magnitude of what has happened.  Having a simple plan and following basic steps to communicate will help insure your company keeps its reputation intact no matter what type of crisis it is facing.

Building Blocks for a Successful Investor Presentation

Building Blocks2010 has been an exciting year for technology innovators as we have seen venture capital investments flow back into the market. As a result many of our clients find themselves in the process of courting investors to fund their new ventures.  Thus the topic of “how to put together a successful investor presentation” has been top of mind.  Today’s blog provides guidelines for putting your best foot forward with a polished and persuasive presentation that will help quickly grab the attention of potential investors.

Before you start your presentation it is important to consider the motivations of the audience you are addressing and align your messaging appropriately. Venture capitalists invest in companies that they believe have the best chance of producing a return on investment, so the sole purpose of your introductory presentation is to convince them that an attractive market opportunity exists and that your company is well positioned to capture a large percentage of that market share.

It is important to remember that investors are not first and foremost a technical audience. To grab this audience’s attention you must first sell them on the potential revenue opportunity in the market/s in which your company is serving. After you establish the attractiveness of the market, they need to clearly understand the value proposition of your company, the solution you bring to market and why you have an advantage over other companies in the space.  What they don’t need at this stage is a technology drill down with complicated charts or confusing industry jargon.

Most important, you must not come across as a solution looking for a problem. Your business needs to be solving problems for its customers. Investors rarely fund companies that provide “nice to have” products and/or services. Potential investors must be convinced that the demand your solution is real, in that the target market cannot grow without your product/solution.

The following is a suggested outline to help you structure a successful investor presentation. The ideal presentation should be about 30 minutes and allow for Q&A to drill down on topic areas most interesting to the specific investor/s.

  1. Market Need and Business Model – This is the most important slide and needs to capture the investor’s attention right out of the starting gate. State what problem your solution solves and how you make money from it. How critical is the market problem and what is the impact of your solution?  Highlight market buzz words and trends.
  2. Industry and Market Overview – Overall size of the target market, growth, and expected penetration. Include references to industry analyst reports or other 3rd party sources for credibility.
  3. Product and/or Service Offering – What do you offer, how do they solve the customer’s problem, what validation do you have of their acceptance by potential customers and their effectiveness?
  4. The Management Team – Who are they, what are their areas of expertise, and their past successes. Include your key managers, directors, and advisers. The strength of your management team is absolutely critical to your business success and your ability to raise investment capital.
  5. Strategic Partners – Partners bring credibility (especially big name partners) so be sure to include any company that has bought into your vision tor will help you establish a competitive advantage.
  6. Competition – Who are they and what kind (large incumbents, other startups, substitute solutions)? What are their strengths and weaknesses? What are the barriers of entry in general to new competitors in your market?
  7. Competitive Advantage – Explain your sustainable competitive advantage and how you differentiate yourself. What barriers to entry have you already overcome that will make it more difficult for other competitors to enter the market? Will you be able to patent your technology to defend territory?
  8. Marketing Strategy – How will you sell and market your solution? How do you make money? What are your sales and distribution channels? What markets will you target? Who is the buyer?  What key problems are you solving for the target customer?
  9. Financial Expectations – What is your basic financial strategy in terms of revenue streams and margins? What is the plan (path) for making the business profitable? When will the business be self sustaining (cash flow positive)? Why are your revenues forecast to increase each year?
  10. Funding Request – How much has already been raised (invested) in the company? Who are the current investors, their ownership shares, and composition? How much funding are you seeking now? What valuation are you assuming for the company for this funding request? Discuss any future rounds of capital that the company expects to require. Have a detailed slide of how you arrived at the valuation available for the Q&A session.
  11. Use of Funds – How will you use the funds (be detailed), when do you forecast the various expenditures to occur, and how much?
  12. Exit Strategy – What is the planned exit strategy and when? If the plan is a sale then who are the likely buyers and why? What is the forecast valuation of the company at the exit point? What is the investors expected return on their investment?

With renewed interest in technology innovation by investors, it’s a great time to pursue funding – just make sure your first meeting/presentation is a good one – with the number of companies vying for money, it may be the only opportunity you have.