One cannot save a boat once it begins to sink. RMS Titanic, a ship that was known as ‘the unsinkable’, sank more than a hundred years ago, but left us with a lesson on preparedness, de-risking and prudence. In a dynamic world, any corporate, big or small, is likely to encounter issues and crisis at different stages of their business. Given the scale and size of start-ups, entrepreneurs are particularly impacted and vulnerable to the rapidly changing business environment as well as internal issues posing as reputational risks.
In a quest to build a respected and sustainable business model, entrepreneurs are walking a tight rope chasing performance and profitability as well as focused on building a brand. Entrepreneurs often marginalise the importance of building a robust issues and crisis preparedness framework until and unless they are faced with a business threat. Managing and upholding reputation is a complex task mastered by only a few. Once a business gathers enough momentum and awareness of the start-up has increased, that’s when the primary foundation of reputation should be laid. It is at this junction that communication acts as both a catalyst to build reputation and a hedge against crisis.
Against a challenging economic environment, a well-thought crisis communication plan to navigate a crisis is the need of the hour! Here is a three-phased approach to dealing with a crisis at hand:
Preparedness is key
Predicting scenarios that could possibly transpire as an issue or crisis unfolds is as good as running a rehearsal before you pitch on the field.
As any start-up charts its growth trajectory identifying possible expansion opportunities, it is important to simultaneously identify the potential triggers and risks that can stall or deter the growth path.
It is recommended that start-ups prepare a detailed issues and crisis preparedness plan identifying various scenarios and risks, the possible impact on stakeholders and a planned course of action. Nothing happens in silos. The company should put together a crack team comprising all business heads and media-facing roles to collectively brainstorm on both external and internal risks and strategise the way forward.
Be pro-active and respond!
Reputation is hand-in-glove with the dynamics of the business environment – everything is public for the consumption of all and sundry.
As a start-up, you cannot be agnostic to the industry you are venturing in. If there is a business impact or an industry impact, you will be talked about. What must you do then? It is important to have a point of view, holding statement(s) and a variety of responses ready. Most start-ups face issues that are either funding-related, about corporate governance or based on industry issues that impact business continuity.
Being cognizant of the lifecycle of the business and potential issues will help emerging companies effectively organise and resolve the crisis as and when they are faced with it. Depending on whether you are a first generation or a second-generation start-up and what level of the investment cycle you are in – Series A or Series B, Bootstrap, etc. – it is critical to be well-rehearsed in your response, as also to understand how to engage and communicate. It is also extremely important for spokespeople to undergo relevant training collectively as a group to better prepare themselves for dealing with such issues. There has to be a cohesive and coherent response mechanism, with consistent messaging. More than anything else, it’s important to reinstate trust in the company’s ability to deal with the crisis and a prompt, confident, clear response is the surest way to do that.
Investigating the kernels of the setback
Last but not the least, analyse the situation as the wave has surpassed but the ripples are still around.
Learning from your or the industry’s mistakes is the biggest lesson of dealing with a crisis at hand. Evaluating, analysing, having consistent messaging, being proactive and aligning your teams to the crisis mitigation action plan will help deal with most crises affecting your business. Consumer-focused industries, which are especially prone to crisis, should learn from one another and share best practices to build a seamless preparedness framework.
Start-ups should determine their vanguard against the issues and crisis stratosphere through prompt and impactful communication. It doesn’t matter how big or small your start-up is. Even if you can count your stakeholders on your fingers, they need to have confidence in you. How you react and communicate in a crisis will determine whether that confidence will remain or not.