2 Minute Guide to Crisis Prevention
- Jessie Paul
Jessie Paul, CEO, Paul Writer (Independent B2B Agency) and Independent Director
Indians are known to be unenthusiastic consumers of pure insurance - the sort that only pays out if you’re actually sick. Something in us baulks at paying up good money year after year with nothing to show in return, assuming you stay healthy. Crisis preparedness is very similar - you have to prepare your crisis management plan, train your people and invest in a strategy - knowing fully well that you may never need it.
Most advice on crisis management, in my view talks about reacting and managing the crisis rather preventing the crisis from happening in the first place. But just as you would invest in preventive healthcare - vaccinations, a fitness routine, a diet and such, you need to have a strategy to prevent the obvious causes of a crisis.
Both aspects of crisis management - prevention and reaction - are lacking in most instances of crisis. The Maggi episode that happened a while back is great case study.
What can you do to avoid a crisis?
- Have a Risk Dashboard
Track all the variables that could cause a crisis for your brand. Typical flashpoints are (a) quality testing failures (b) product failure (c) environment (d) personnel relations (e) government relations
- Proactive Influencer Relations
Any large organization in India has to deal with regulation, legislation and
the government at multiple levels, along with regulatory bodies. This is in addition to influencers in the media, social media, industry leaders, champion end-users. I find it difficult to believe that relations soured to the extent of the government filing an unprecedented $99million class action suit against Nestle without any prior history.
If you can’t avoid the crisis what are the ways to handle it?
- Accept the Issue
Even if you cannot accept the allegation, it's better to acknowledge that there is an issue. To ensure transparency insist that your personnel or a respected third party also get involved with the testing/investigation. Get a panel of customers and media people involved in supervising the investigation. All of this will (a) make it impossible to game the testing process (b) show that you are open to admitting fault if there is one (c) show that you have taken some action on the information an not just brushed it aside by doing nothing.
- Show that you believe in your product
You have to be seen vigorously advocating your product in every forum. If there is doubt about the product manufactured in one area, import it if necessary to show that in general it is fine. However, in the case of Maggi, on the other hand, there were news reports that consumption in their own canteens had fallen.
- Business Continuity Program
If there is the slightest risk of harming the consumer, you must voluntarily withdraw or replace the product. And it is important to do this before you are forced to do so, whatever you may believe. Nestle is not a stranger to voluntary recalls and should have immediately invoked a stop-sale while investigations took place. Banks and technology firms have contingency plans in place to ensure business continuity if a particular deliver site or center is impacted.