Nothing tests a business owner’s leadership skills more than a crisis. How one reacts when confronted with an urgent situation is a strong indication of his or her effectiveness as a leader. There are several qualities every leader must possess to successfully weather a crisis, whether that person is the CEO of a Fortune 500 company or the owner of a small, family-owned business.
You need to be able to think and act rationally when confronted with a stressful situation and assess a crisis from every angle to see how it will impact your business both legally and financially, and influence your company’s reputation.
Smart Business spoke to Matt Marchbanks and Donna Mittendorf of Comerica Bank about what you can do when your company faces a crisis.
What is the first thing I should do?
Marchbanks: First and foremost, remain calm. By keeping a cool head, a leader will be able to step back and rationally assess the situation and create a calm environment so everyone can focus on the problem at hand. Being calm doesn’t mean you should downplay the seriousness of the crisis. It’s common to underestimate or deny that a crisis is happening, or to blame others. It can be more damaging to your business to deny a problem than it is to overreact to one.
What should I focus on when faced with a crisis?
Mittendorf: As a leader it is important, especially during a crisis, to listen. You need to know what people are saying, both internally and externally, about the issue at hand. Ask your employees for their takes on the situation and listen to what your customers, your business partners and media are saying, too. Listening to all of these different groups will help you determine the right course of action.
How should I handle the media?
Marchbanks: First and foremost, think through what you want to say. Think about the key messages you want to get across and who your spokesperson will be. Throughout the whole situation, remember to be honest and don’t mislead or lie to the media. Put yourself in the position of various audiences like your customers, employees and the community you serve. Always think, ‘If I were them, what would I expect to hear from the company?’
How should I prepare my employees?
Mittendorf: Make sure your employees know how to answer certain questions when they come up. This is particularly important in small businesses where every employee is a possible contact. It’s important to prepare employees with what to say and what not to say during a crisis, or if they should direct any inquiries to a selected spokesperson.
Should I reach out to my customers?
Marchbanks: Yes. You don’t have to go into specifics about the situation and what you are doing about it, but you should let your customers know that you are addressing the problem and taking steps to ensure it does not happen again. Customers like to be reassured and don’t want to do business with companies they don’t trust.
How can I retain my integrity during a crisis?
Mittendorf: Once you have properly assessed a problem, it’s important to be decisive so you can resolve it in a timely fashion. Whatever decisions you must make, don’t compromise your values. Integrity is a quality a leader needs at all times, and it is particularly tested during a crisis. Also remember to identify the cornerstone values and principles you want your business to be associated with no matter what befalls it, and convey those beliefs whenever you can.
MATT MARCHBANKS and DONNA MITTENDORF are senior vice presidents for Comerica’s Texas Business Banking Division. Comerica Bank is the commercial banking subsidiary of Comerica Incorporated (NYSE: CMA), the largest U.S. banking company headquartered in Texas, and strategically aligned by three business segments: The Business Bank, The Retail Bank, and Wealth & Institutional Management. Comerica focuses on relationships, and helping people and businesses be successful. In addition to Dallas, Houston and Austin, Texas, Comerica Bank locations can be found in Arizona, California, Florida and Michigan, with select businesses operating in several other states, as well as in Canada and Mexico. To receive e-mail alerts of breaking Comerica news, go to www.comerica.com/newsalerts.