Here’s What to Do When Things Go Wrong in Business

Life can be unpredictable. Even if you’re doing everything right with your business, a crisis can occur that jeopardizes its health. For a small business, you might not have the resources to bring things back in balance. This can mean that your customers get upset and your sales suffer. You may start to lose your credibility, and lose money too.

Acknowledge a Mistake

People such as Warren Buffet and Richard Branson have experienced this on a large scale, losing billions. Nobody is immune. Take for example, the crisis Toyota went through back in 2009 when their vehicles had accelerators that stuck, which actually killed and injured customers. The company didn’t help their situation when they didn’t immediately recall those vehicles. They lost both sales and their credibility.

In the early 90’s, PEPSICO had a crisis because it was believed they made cans of Diet Pepsi that had syringes inside. Pepsi took quick action and found that there was one person within the company who was at fault. He was arrested and Pepsi publicly talked about the issue and made an apology. Pepsi didn’t suffer the same kind of backlash as Toyota did, because they owned up to their mistake.

These are good examples of what you should and should not do when you make a mistake that impacts your customers. If you have a small business, it’s important to take these steps as well. You should always have a plan to TAKE responsibility for things that go wrong and ensure that there is a go-to person in place to take care of damage control.

 




 

Here are some of the ways to successfully manage and get past a crisis :

Be Objective

When things have gone into crisis mode, don’t forget to leave emotions at the door. They can completely get in the way of you making rational, conscious decisions. Stay calm and remain your composure. Analyze the situation, get deep into the reasons why it happened, and be reasonable about what you’re going to do about it. If you are able to recognize and define what the issue is, you’ve done half the work. If you’re a CEO, it’s important that you stay calm as others are looking to you. If you’re not calm, your staff won’t be either.

If you’re emotional when things aren’t going right, you’ll have a hard time making the choices you need to make to rectify the problem. You might experience anxiety, which doesn’t allow you to think at all. You need to be able to look at various perspectives in order to solve the problem. If you were to make a judgment call based on fear, it is likely not going to be the right choice.

Be Honest in Your Media Communications

It might not always be easy to admit to the public that you have made a mistake, but it’s really the best practice. Take Exxon for example, in the late 80’s one of their oil tankers dumped millions of gallons of crude oil into the ocean. They got a lot of bad press, which made their reputation sink. It also didn’t help that they wouldn’t take responsibility for the mistake. It took a long time before they made a statement to the public. Their company was marred with the reputation of not caring about the environment, hurting their business.

It’s important that you stay highly communicative, so people know how you feel and what you plan to do with the crisis. A big company may start to feel that they’re untouchable and what the public thinks about them doesn’t matter. They don’t feel the need to talk to their customers when they’ve made a mistake. A small business may also feel the same, not acknowledging their mistakes or taking accountability for what they’ve done wrong.

Once you’ve acknowledged the problem, it’s important to talk to your public. Be honest and sympathize with the people who were affected. Speak to them directly, and ask people for your support as you do your best to right the situation. If you try to hide any of the facts and people later find out, the outcome could be devastating for your company. You never know who will figure out what you’ve been hiding and let the public know. This would make your situation much worse in the long run. Credibility would be lost, and your customers would move on. You don’t want to speak in a political manner, confusing the public. Be as real as you can about the situation, why the mistake happened, and what you plan to do with it.

Have a Plan

Once you’ve appeased any customers or stakeholders within the business, you should look within the company. Bring together a team of people from various departments that are relevant such as your finance leader, legal services, and human resources. Talk about the problem extensively and try to figure out your plan of action together. You’ll then want to execute your plan, also known as your crisis management plan. This should be based on the philosophy and ideology your company was built on. When you keep this in mind, you’re not deviating from the company vision and all it stands for, which would further affect your production in a negative way. The plan should be picked apart and looked at thoroughly. It should be directly addressing the actual crisis that has occurred.

Change the Plan When Necessary

Really look at the crisis management plan and see if you can make the necessary changes. Some of your best solutions may be too costly to execute. Before you actually implement any part of the plan, lay out some targets and measurements so you can access the progress. If your outcomes aren’t materializing in the given timeframe, you should consider adjusting your strategy. You want to remain flexible when you’re dealing with the situation. Always be aware that you may have to adapt your plan when it’s not working.

These strategies will help you work through a crisis quickly, minimizing damage to your company’s bottom line and reputation. It’s important to follow these steps so you can show everyone that even in a crisis, your business is professional and responsible.

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Loraine Couturier
Staff writer: Loraine Couturier is a jet set writing chick from Canada that travels around the globe. Her writing and marketing skills are what keeps her eating exotic meals and jumping on planes. Loraine loves writing about pretty much anything and likes to pass on the knowledge she has to others. Visit her at lorainecouturier.com

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Staff writer: Loraine Couturier is a jet set writing chick from Canada that travels around the globe. Her writing and marketing skills are what keeps her eating exotic meals and jumping on planes. Loraine loves writing about pretty much anything and likes to pass on the knowledge she has to others. Visit her at lorainecouturier.com

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