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Managing the Elements of Corporate Reputation During Crisis Recovery
Thomas Martin, senior vice president and director of corporate relations at ITT Industries
ITT Industries' senior vice president and director of corporate relations has handled a variety of crises in his career, first with FedEx and then at ITT Industries. He cites Bernie Ebbers of Worldcom, Dennis Kozlowski of Tyco and Ken Lay of Enron as instances where reputation mismanagement triggered a crisis.
He stresses that crisis communications requires understanding the differences between brand and reputation while recognizing they are interwoven. Being aware of this also requires preparing a company before a crisis occurs. This includes establishing a clear vision for reputation management, fostering healthy, ongoing relationships with key partners and stakeholders, and considering the impact every business decision will have on corporate reputation.
Tom offers common themes that arise when a crisis situation goes awry, such as (1) the cover-up being more damaging than the event itself, (2) arrogance playing a distinct role toward public perception and (3) the consistency of crises starting small and gaining momentum before they damage reputation. Recovering successfully from a reputation-threatening crisis requires some simple yet often overlooked tactics. They include:
- Building a reputation "bank account" with "deposits" of positive reputation credibility
- Honestly acknowledging mistakes
- Implementing fast, deliberate and honest recovery action
- Listening closely to stakeholders' concerns
- Building coalitions and support structures
- Committing to meaningful change and implementing it in a timely manner
- Monitoring progress closely
The corporate-communications function plays a vital role in the crisis-recovery process and must be ready to respond with strategies and tactics when the executive team seeks counsel. "Be prepared," Martin says of corporate communications during a crisis. "When you're given the opportunity to impart your knowledge and insight, it's imperative that you know the language of the business and your industry as well as the issues the organization is confronting. Empathizing with your colleagues is also important as you need to have an appreciation for where they're coming from."
Finally, companies must demonstrate that they practice the behaviors they are advocating with composure, humility and sincerity. All are integral to restoring and maintaining corporate reputation during the recovery process.