Better to be safe than sorry with a crisis communications plan

by Melissa Murphy

Melissa Murphy

Companies of all sizes allocate tremendous resources to building their brands, but very little thought and consideration is devoted to protecting them. Often, crisis situations are sudden, powerful and damaging, leaving organizations scrambling to determine and enact a solution. In a crisis, information is often incomplete and rational decision making is difficult. Having a basic crisis communications plan in place can mitigate the fallout.

In smaller fund companies, crises could involve regulatory issues, fund underperformance leading to significant outflows and the unexpected departure of a key executive. Crisis situations can arise under a variety of circumstances and can impact your organization by being directly involved or indirectly by industry association.

How did you handle the dot-com crash, the mutual fund late trading and market timing scandal, and the financial and mortgage meltdown in 2008? We want to know. Email us your thoughts.

There are five phases to a crisis communications plan: vulnerability assessment, rapid response planning, training, testing and maintenance and recovery management.

The breakdown goes like this:

1. Within the vulnerability assessment phase, executives must brainstorm to determine the top issues that could potentially impact the organization, the caliber of impact, as well as the prioritization and likelihood of each event occurring.

2. The rapid response phase involves developing a crisis team that should include key managerial executives, marketing and public relations executives as well as legal counsel. Spokespeople must be trained in advance of a crisis, contact information for crisis team members must be accessible and someone needs to be assigned to real time monitoring of mainstream and social media.

3. The training phase involves defining specific threats along with the development of architecture for crisis messaging. Basic messages for each key crisis scenario can be outlined as part of the plan so they don’t have to be created from scratch in the midst of a real crisis.

4. The testing and maintenance phase helps keep the plan fresh and updated. A crisis plan is not a static document and as such should be revisited periodically as business circumstances evolve, members of your crisis team change jobs or external factors alter the parameters for phases one, two and three. Smaller fund firms should aim to revisit the plan at least once a year.

5. The final phase of a crisis plan is recovery management. This aspect determines how to ratchet down communications as a crisis nears its end and potentially offers a list of marketing ideas on how to emerge from the crisis even stronger.

Crisis plans for smaller organizations can be brief and concise but it is critical to anticipate and plan for difficult situations. Even if you can’t fathom crises coming your way, it truly is better to be safe than sorry.