Crisis Communication

Business “crises” happen every day but, fortunately, not all rise to the highest levels of concern. Computer systems crash, key staff leave their jobs, earnings miss their mark – situations that can cause challenges and stress for your credit union, but usually don’t escalate to the point of causing long-term harm.

But sometimes, they do. A business crisis can cause significant problems, as can other sudden or disruptive events, like tornados, earthquakes or other physical crises.

Credit unions that have crisis communication plans in place – and review them alongside their business continuity plans – are better equipped to manage the media storm, communicate effectively with their publics, retain member loyalty and protect their reputations.

Are you prepared for unwelcome issues to erupt at your credit union? Who will address the media and what statements can be made? Is your credit union’s core message and background information readily available? What will you tell members? Knowing the steps to take ahead of time provides critical direction during the turmoil following an event.

As you begin your plan, it’s important to understand what constitutes a business crisis.

Types of Crises

While many components of crisis communication plans are standard – initial company stance, identified spokespersons, notification tools – your response strategy and preparation period will vary depending on each situation. If police or local authorities are involved, such as after an armed robbery, it’s likely they will take the lead with the media and address immediate concerns, shifting your focus to key stakeholders and operational recovery (if needed). But if it’s an internal situation, like a data breach or employee misbehavior, your credit union will likely be juggling all areas of response.

According to the International Association of Business Communicators,  there are four crisis categories, as outlined in its manual, “Crisis Management and Communication”:

• Sudden – A major event giving little or no warning that disrupts normal operations is a sudden crisis. It typically generates the most news coverage and public interest. Examples include natural disasters, removal of a senior officer, or workplace violence. Your credit union may anticipate that such a crisis could occur, but you can’t know when it might happen.
• Smoldering – This type of crisis is known (or should have been known) by a few employees, but staff fails to respond appropriately and it hasn’t been brought to the attention of management or the board. Examples include discrimination claims, major product/service problems, or financial losses.
• Perceptual – Sometimes, there’s no “real” problem, but stakeholders think there is. Rumors or misinformation threaten your reputation and include fear of company layoffs or a run on the credit union.
• Bizarre – These crises are almost unbelievable, leaving you scratching your head about what is the truth. A famous example is the “finger in the Wendy’s chili,” which actually was a setup for a fraudulent lawsuit. Yet, the event was significant enough to harm the company’s bottom line. 

Determining the type of crisis your credit union faces will dictate your responses and communication priorities. Here are some best practices to help you plan for potential crisis scenarios:

• Create a “mock event” – a set of assumptions about a negative situation that could occur, based on each major type of business crisis. (For examples, check out industry news on recent crises, such as embezzlements, security breaches or robberies.)
• Determine how each scenario is likely to affect your credit union’s reputation and ability to operate.
• For each scenario, determine the events most likely to occur and create sample message platforms and talking points that can be adapted as needed. Determine your key audiences, communication channels you will use, and who will serve as subject-matter experts, along with official spokespersons.
• Get help. In times of crises, an outside perspective is invaluable. Rely on legal counsel and professional public relations assistance to provide a clear perspective and sense of calm – hard to do when you are in the eye of the storm. 

It’s important to know that, while there are different types of crises, they tend to share common characteristics. Most crises are fast-changing and require quick decision-making. They could hinder operations, place severe stress on the board and personnel, and even threaten the credit union’s survival. And with today’s round-the-clock news cycle and extensive use of social media, the need for pre-planning your communication response is all the more important.   

As President Eisenhower said, “Plans are useless; planning is indispensible.” Not having a crisis communication plan that is regularly updated and available to help guide you when the unexpected happens can easily result in costly, reputation-damaging missteps. By understanding and planning for the various types of crises your credit union might experience, you’ll be well-prepared to respond and recover.

Margaret Blankers is president of Margaret J. Blankers Public Relations Group, which she founded in 2002 after more than 20 years’ experience in credit union public relations. The firm works with credit unions, trade groups, CUSOs and other service providers nationwide to provide strategic PR and crisis communication services. Contact MJB PR Group at 866.714.7041 or www.mjbpr.com.

For more resources related to crisis response, particularly pandemics and COVID-19, visit this page on CUmanagement.com, or visit our Coronavirus Update page on CUES.org.