Crisis management for small business

Mon, Feb 22 2016

A crisis can affect any business – no matter how small. Everyone’s definition of crisis varies but one thing is common: that it’s an event that is beyond the scope of normal business life with the potential to damage your reputation.

If you think your business is too small to warrant a crisis management plan, then you may risk unravelling a lot of brand value and marketing effort.

A crisis could take various forms – a stock-out due to strike action; a competitor sledging your reputation in the media; or a run-away community-based smear campaign on social media.

In fact, when your business is online as most are, the exposure is greater and requires more forethought to ensure you can minimise damage to your reputation and your brand.

EXPERT TIPS

Yes! Online magazine recently spoke to Melbourne-based crisis expert and author Dr Tony Jaques, Managing Director, Issues Outcomes to get an overview on what businesses should consider when planning a crisis management strategy.

“It’s a common misunderstanding that only big companies and big brands need, or can afford, crisis management,” he said.

“We know from research that many smaller organisations regard crisis management as too expensive or too hard to establish, and they may believe they are less likely to be hit by a crisis.

“None of those things are true. Big organisations and big brands typically have more resources and sometimes in-house specialists.  And their crises are more likely to make headlines. But smaller organisations are just as much at risk and there are some basic protective actions which are not difficult and not expensive,” Tony said.

TRIAGE YOUR RISK

Small businesses should first identify and manage the issues which have the potential to become crises.

“Then they should put plans in place to be prepared,” Tony explained. “There are simple ways to do this. Although you can’t prepare for every possible crisis, every business has what I call natural crises. These are the risks which are natural to the business and represent the most probable crises.

“For example, every food company should have plans in place to respond to a possible product contamination crises; a company handling dangerous goods should be prepared for a spill or fire, and a company heavily dependent on IT should be prepared to deal with a cyber-attack or loss of data.  No-one knows your business risks better than you,” he said.

IDENTIFY A SPOKESPERSON

Even the smallest business should determine who will be the nominated go-to person in a crisis. That might be the owner, the manager or a subject-matter expert. There may be a different spokesperson for different types of scenarios but there should be a primary point of contact that will triage the issue and allocate the right person if required.

“It’s critical that everyone in your business knows who will speak for the organisation and what they will say,” Tony said. (Make it known to all your team so that they are not tempted to handle the issue themselves.) While big companies usually have experienced spokespersons, smaller organisations often make a crisis worse by not speaking at all, or saying the wrong thing. Media training is not expensive, though must be done before the crisis, not when all hell breaks loose,” he said.

Crisis management can seem daunting to small businesses but with some planning there’s no doubt it’s worth the effort. Think of it as an extension of your insurance policy coverage.

In future articles, we’ll bring you more detailed tips on how to formulate a crisis management plan for your business. For now, though, simply being aware of the potential issues could make all the difference.

“Even a basic crisis management plan may save your business from being the one in four which does not survive a crisis,” Tony concluded. “You don’t have to commit a lot of money and resources, but you do have to consciously want to do it.”

Author: Katrina Ganin, Optus. Original article found here: https://blog.optus.com.au/business/crisis-management-small-business/

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