Category: Compliance, Conferences and Events, Transfer Agency

An Ounce of Prevention (is worth a pound of crisis management)

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Every year a number of Boston Financial associates attend the Massachusetts Conference for Women. Being the largest conference of its kind in the country, the event hosts a number of prestigious speakers and packs a full agenda of educational break-out sessions.

This is the first in a series of blog posts recapping the experiences our associates had at the event.

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Risk-Management---187827816“I have never had an intimate relationship with the president, nor do I encourage my investigators on my staff to beat people or move bodies.” – Judy Smith

Perhaps best known as the inspiration for the character Olivia Pope in the popular ABC television crime drama Scandal, this is how Judy Smith started her Crisis Management 101 presentation at the 10th annual Massachusetts Conference for Women, hosted Thursday, December 4 at the Boston Convention and Visitors Center. Judy Smith launched her crisis management career in 1987 as Deputy Director of Public Information in the Office of the Independent Counsel Lawrence E. Walsh during the Iran Contra investigation. She has worked for the Office of the U.S. Attorney and was Deputy Press Secretary to President George H. W. Bush. She now manages Smith & Company, a full-service crisis management and communications firm where she helps clients like Monica Lewinsky and Michael Vick manage reputational crises.

One only needs to look to the massive theft of consumer credit card data at retail giants Target (2013) and Home Depot (2014) to remember that the financial industry is at risk for reputational crisis. One of the reasons mutual fund companies outsource their TA and compliance services to Boston Financial is to manage this risk. And in doing so, our clients are taking the first step in crisis management, which is to prevent it.

But what to do in the unlikely event that something does happen that requires your public relations team to go into crisis management mode? According to Judy Smith, your messaging should be carefully planned to:

  • Communicate the Truth  In the age of social media, we no longer have the luxury of controlling the medium and the message. Expect that someone else, over whom you have no influence, will be talking about the issue. Making sure your messaging is grounded in truth ensures you won’t get trapped in a ‘gotcha’ moment that compounds the crisis – because someone is bound to find those skeletons in the scandal closet.
  • Answer the question “What has the firm done – or not done – to get to this place?” – In partnership with your legal counsel and other professional advisors, consider the factors that contributed to the crisis. Then sketch out a plan for fixing it. Integrate this analysis and remediation strategy to put the firm in the position of taking responsibility for the crisis and proactively answering the inevitable ‘now what’ questions.
  • Avoid “woe is me”  If your firm is in crisis management mode, it is unlikely that anyone will be ready to empathize with you. So don’t ask for it.
  • Be consistent with your brand Carefully aligning your message with your brand value – without being insincere – demonstrates corporate integrity. If the situation warrants an admission that the crisis is an example of not living up to your brand promise? Then you have the opportunity to demonstrate a little humility too. Both integrity and humility can buy a lot of good will during a crisis.

Any crisis you find yourself in isn’t likely to just go away. So don’t wait to communicate. Smith told a story of a client who accidentally emailed risqué photos of herself to her male boss. Understandably mortified, she waited five days to approach him. While she mulled over what to do, the news of her mistake spread throughout the organization, which resulted in the client needing to engage in reputational repair not only with her boss, but the entire company.

Judy Smith’s crisis management 101 advice was fairly simple. But one only needs to imagine oneself in the board room at Target or Home Depot to realize that crisis management is anything but. So the lessons learned from Ms. Smith? An ounce of prevention is worth a pound of crisis management.

Gretchen Kinder

Gretchen Kinder

Gretchen Kinder works for Boston Financial's Sales Support and Corporate Marketing team where she works on sales support and strategy documents. Gretchen joined Boston Financial in 2014 after nearly two decades of professional experience in Boston’s nonprofit and municipal sectors. A Jane-of-all-trades, Gretchen earned her MSW/MPH from Boston University in 1997 and has held positions as a community organizer, program manager, fundraiser, event planner, strategic planning consultant, adult educator, philanthropic community manager, public information officer and grant writer/manager. She has worked in the fields of chronic disease management, community service learning, health professions education, philanthropic planning and wealth management, urban planning, public and community health, PK-12 public education, early literacy, mental health and dental insurance.

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