The Importance of Effective Crisis Communication
An Interview with Oliver S. Schmidt, Principal of C4CS

 Why is crisis communication important and what is involved in the planning process?

Schmidt: We have seen it time and again over the years. Corporations respond well to a crisis situation from a managerial and an operational point of view, but they don’t communicate effectively with their internal and external stakeholders. As a result, they suffer significant reputational and economic loss.

In times of crisis the organizational future hinges on how stakeholders perceive and react to the company’s handling of the situation. Stakeholder perception and behavior are driven by the information that the company and other sources such as the media and opinion leaders provide. Hence, whether or not the company emerges from a crisis as a winner is increasingly determined by how effectively it communicates with its internal and external stakeholders. It is, therefore, crucial that management understand and act upon the fact that crisis communication planning is an integral part of comprehensive crisis preparedness planning.

Crisis communication planning calls for the communication function’s representation on the corporate, and if applicable also on regional and local crisis management teams. It includes the development and implementation of a crisis communication strategy and a crisis communication plan that are tailored to the company’s needs. In addition, conducting recurring media-spokesperson training and crisis management drills which, among other factors, test the internal and external crisis communication readiness is indispensable.

 What makes crisis communication effective? Are there characteristics worth noting?

Schmidt: Effective crisis communication is timely, truthful, consistent and coordinated and has a greater chance of achieving the desired objectives if the company engages in an ongoing and constructive dialogue with its stakeholders long before a crisis happens. Effective crisis communication also relies upon the proper organizational structure and tested processes, tools and skills that enable both one-way and two-way communication with internal and external stakeholders, active media involvement and Internet utilization.

Unfortunately, many companies do not have the necessary elements in place to communicate effectively in times of crisis and often lack an issues management program and a risk communication strategy. Some companies also commit the mistake not to engage in sufficient stakeholder analysis. In the last month alone we assisted four companies in responding effectively to surprise moves by well-organized activists who employed traditional and online communication channels to disseminate demeaning and factually wrong information.

Two of those companies neither followed a systematic message development process nor did they exercise a company-wide ‘One-Voice-Policy.’ Other companies we have worked with in similar situations failed to systematically monitor the Internet although they were aware that no organization is immune to the potentially harmful consequences of instant, global and uncensored online communication. An Internet Monitoring strategy and the other elements I mentioned enable effective internal and external crisis communication and must be established, tested and refined before a crisis occurs.

 Do you believe that companies should pay more attention to internal crisis communication?

Schmidt: Yes, I do. In an effort to satisfy the communication needs of external stakeholders, internal crisis communication often takes the backseat. But as I explain in the article I contributed to the 2004 / 2005 Disaster Resource Guide, employees are a key stakeholder group that must be communicated with in times of crisis. Any company that fails to do so puts the success of the entire crisis response at risk. I have made presentations on the subject in a number of countries and just accepted an invitation to conduct a workshop entitled 'Effecitive Employee Communication in Times of Crisis' at the 15th World Conference on Disaster Management. Fortunately, more and more companies are now redirecting the necessary resources toward improving their internal crisis communication capabilities.

 You have lived and worked in several countries and advise senior managers at multinational corporations concerning high stakes communication issues. How do U.S. corporations compare to their European and Asian competitors in terms of crisis communication preparedness and actual performance?

Schmidt: We work with multinational corporations from various industries and find that as a tendency, U.S. corporations are somewhat better prepared to communicate effectively in times of crisis than European and even more so Asian companies. However, because the discipline is constantly evolving, there is always room for improvement and no company can afford to be complacent. And regardless of the country or industry, our client partners agree with us that optimizing crisis communication preparedness is essential for sustaining economic success.

Actual crisis communication performance is the result of committing the necessary resources to thoroughly prepare for adversity and train for the appropriate response under realistic conditions. That rule applies no matter where the company is based.

About Oliver Schmidt

Oliver S. Schmidt is the managing partner of C4CS™, a leading consulting firm based in Pittsburgh, Pennsylvania that specializes in strategic communication and crisis management.

A multilingual native of Berlin, Germany, Schmidt has lived and worked in North America, Europe, and Asia. He regularly advises senior managers concerning high stakes communication issues, provides executive coaching and management training, and makes presentations to audiences around the world.

Mr. Schmidt combines extensive international work experience with a solid academic education, holding a Master’s degree in Communication Science and Business Management. He has been a guest lecturer at universities in the U.S. and in several European countries.

The 2004 / 2005 Disaster Resource Guide included an article authored by Mr. Schmidt entitled ‘Effective Employee Communication in Times of Crisis’. You may contact Oliver Schmidt via telephone at (412) 708-0940 or by email at schmidt@c4cs.com or visit the C4CS website at www.c4cs.com