navigating a corporate crisis © 2012 fox rothschild llp navigating a corporate crisis pre-crisis...

Navigating a Corporate Crisis

© 2012 Fox Rothschild LLP


Pre-Crisis Phase

September 20, 2012

Presented by

Dori K. Stibolt



Does your company have a crisis management plan?



Is this your current crisis management plan?



Why do you need a crisis management plan?

Crises are unpredictable, but should not be unexpected

Since crisis events are generally a surprise, planning is vital because you likely will have a short response time

Protect reputation, market share, competitive edge, investor confidence and the long term health of the org.



Why do you need a crisis management plan?

In times of great stress, people revert back to what they know and how they have been trained to respond

As such, if you want your people and your organization to respond well to a crisis, your employees need a plan, leadership, and a level of knowledge and training to respond appropriately

Preparation can be the difference between success and failure



Role of In-House Counsel

Educate, educate, and then educate some more- Counsel must educate management and the

board of directors that no business is immune from a crisis

- Lobby management to implement and commit resources ($$$) to a crisis management plan




Preparation of a crisis management plan is going to involve costs

Provide cost-benefit analysis to upper management

When undertaking your risk audit, think about how many days (or weeks) your company might be unable to operate per each potential crisis




Think about and estimate lost business per day/per site

Analyze potential losses related to:- Business opportunities- Reduction in market share- Customer confidence- Brand/reputation impact




Prepare Crisis Management Plan.- Strategize regarding the kinds of crisis that

may impact your company- Undertake a risk audit- Develop a crisis management team- Develop an agreed upon crisis response

philosophy with senior management



Potential Corporate Crisis

Product recall or product safety issues




Federal or State investigation or enforcement action




Attacks by consumer advocacy groups




Serious injuries involving your product or service




Major infrastructure failure/supply chain disruption




Executives or officers are indicted or arrested




Natural disaster or fires




A whistleblower

employee



Risk Audit

What could disrupt our business? Short Term disruptions Long Term disruptions Look to your comparators Review and analyze past crises Identify your vulnerabilities



Risk Audit

Financial Strategic Operational Compliance Reputational



Crisis Management Team

Who should be on the team? A well thought out team should include:

- Management- Legal- Operations- IT- Public relations- Human resources- Business units



The greatest crisis management plan

This is called the nuclear football, it is part of our country’s Mobile Emergency Command Center

The President of the United States utilizes this when he is away from a fixed command center.



Prepare Your Plan

Components of a crisis management plan:- Executive summary- Crisis Management policy- Types of events covered by the plan- Response plan- Crisis communication plan



Prepare Your Plan

Crisis management team should have good understanding of all aspects of the company and business

Depending on team configuration, each team member may report on their area of the business or prepare a fact sheet

Utilize discoveries from the risk audit to determine probable scenarios to prepare for



Prepare Your Plan

Brainstorm and role play Assign other team members as a Devil’s

Advocate committee Contemplate and address the worst case

scenarios Prioritize



Prepare Your Plan

Design is important- Easy to read type- Understandable sub headings- Index- Flow Charts- Lists

Contemplate having a first hour check list



Prepare Your Plan

Include and maintain information on major projects in-progress

Assign team members’ responsibilities Detailed contact information for team

members and other important individuals (outside counsel, insurance, utility companies for a site



Prepare Your Plan

Incorporate your company’s vision and ethical standards into your plan

Develop and prepare your response to the crises that you have identified:- A product recall- An injury due to your product/service- A visit by law enforcement- A weather event



Prepare Your Plan

Develop crisis communication plan- You will need an internal crisis

communication team- Assign a person to communicate internally to

employees- Make sure to have a back up person - Communicate accurate information to

employees in a timely manner



Prepare Your Plan

Develop crisis communication plan- Take charge of communication quickly but

cautiously - Consider making a preliminary statement- Understand the facts and the situation before

making a more detailed statement- Understand the dynamic between admissions and

future litigation- Be aware of and monitoring social media- Be prepared to address any past issue



Prepare Your Plan

Develop crisis communication plan- Understand who will likely be your audience

in a crisis situation Employees News media Site neighbors Community Leaders Elected official Customers Stockholders and financial coummunity



Prepare Your Plan

Develop crisis communication plan- Communications during a crisis should be calm,

organized and factual- Establish a predetermined communication center

(and a back-up)- Establish telephone answering procedures for

directing media and emergency inquiries to the appropriate people

- Establish an internal system for communicating with employees



Prepare Your Plan

Develop crisis communication plan- Develop positive messages for your crisis

response Safety record Family owned Community and charitable giving

- Be certain employees know who the authorized spoke person is and they further should be trained to not respond to media



Prepare Your Plan

Develop crisis communication plan - Act FAST – the media will mobilize quickly- Make the media aware that you want to be

helpful and cooperative- But, do not speculate- Maintain contact information for media - Schedule additional updates both for the

media and employees



Prepare Your Plan

Develop crisis communication plan- Be aware and appropriate if crisis has

caused death, injury, environmental damage- Providing some media statement is better

than not talking- Do not provide “off the record” or “no

comment” statement- Do tell the truth- Continue to be accessible and responsive



Prepare Your Plan

Integrate your crisis management plan into your company policies and procedures

Train your employees Practice for an emergency Update your plan on a regular basis Hold crisis management team meetings



Now What??



Contact Information

Dori K. Stibolt

[email protected]

561.804.4417

navigating a corporate crisis © 2012 fox rothschild llp navigating a corporate crisis pre-crisis...

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