Emergency marketing response: The crisis solution

Wham!

Something really bad happens, and you need to act fast.

It could be a horrible piece of publicity when one of your employees or subs is killed on a job site accident, your key client defects to a competitor (or worse, goes bankrupt just after you finish a major job but before you are paid), or terrorists hijack four planes and aim two of them for high profile public buildings in a market you thought you were succeeding in, and were about to expand. (For me, Washington Construction News, September 2001.)

Things happen in business and in life, and not everything is under your control.

You can plan for contingencies, but can you plan for everything?

To some extent, yes, but I would argue that outside of some common sense, you can't worry too much about the improbable or unexpected events that affect everyone. You'll be in a mess, of course, but so will everyone else around you. (And sometimes disaster equals opportunity -- I'm sure most contractors in Louisiana didn't fare too poorly after Katrina struck.)

The disasters you need to watch and prepare for are the ones which aim squarely at your own business, but no one else. These are usually self-inflicted. (It turns out I had business problems in Washington, D.C. which had nothing to do with 9/11 but were caused by my then lack of sufficient management controls and oversight of people/processes.)

Lets take the job site accident, for example. Are you observing all the relevant safety regulations, and do you have best-practices for managing and training your employees in the processes. (Skimping your safety budget to enhance your marketing is surely not a wise business decision, because when something goes wrong you will more than pay for the collateral damage.)

Is your credit and business management so loose that you would allow yourself to be caught when a major client fails, and are you too dependent on a single client, who will cause business havoc if he leaves? For the latter problem, some intelligent marketing to enhance your client diversification is as wise an an expense as appropriate insurance coverage and good safety training.

These preparations are helpful, but you need another quality to get through really bad situations. I call it a great stress instinct and am fortunate to be well equipped in this regard. When something goes wrong, I quickly figure out a response or solution, often within minutes, and get down to work.

You probably know if you have this trait yourself. If your business has been banged around by the recession and is still viable (or you lost your job in the hard times and managed to start, and succeed, at business in the current environment) you are okay.

Don't sweat the small stuff.

We're still in Washington, by the way. Issue number two of the Design and Construction Report will publish and go on line next Monday. But I have a client service crisis to resolve which I learned about at seven p.m. last night. I've already mapped out my simple and inexpensive solution.

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Crisis, change and opportunity

Mel Lester's description in his blog entry, Success, for a Change, of how a company successfully changed its business model to make safety a high priority is an enlightening reminder that sometimes really good things can happen when you push through and do things differently.

But change is hard. In Lester's story, the change occurred when his company's major client made it clear that safety must be a priority or it would lose business. Few things can motivate executives and employees to 'get it' than to realize they are about to lose their client (or job) if they don't shape up, and quickly.

My own business is seeing some changes now, as I recover from one of my more expensive blunders of recent years. Thinking we had successfully overcome the last major crisis and were on the way to rebuilding a massively successful company, I let go of key cash and business management controls, relying on inadequate financial reporting and measuring resources.

Costs skyrocketed just as the recession began tearing into our sales volume; and (worse), I pushed forward with business expansion plans thinking that "one bad month" would not thwart our success.

Well, the four-letter-word indeed hit the fan, and we suddenly faced an immediate business crisis. The solutions are still under-way, but we learned some important lessons which you may find helpful in your own business.

Little things count. Not because you are nit-picking, but because tackling the little things (quickly and without much time/effort) allows you to see and resolve the big picture. On Monday, for example, I cancelled a bill for a cell phone number I hadn't used in two years. We are especially careful in monitoring the credit card billing statements, checking them online every day, for charges which need explaining.

Decisiveness is vital. I've had to make hard, tough decisions, which impact on individual employees. In one case, I asked someone who joined us after a lengthy selection process to leave within two weeks of joining the company (fortunately, we had not lured the person from a better-paying job, so didn't harm the individual.)

Fairness and respect are essential. One of our employees combines income from hourly pay and contract work, with the understanding (at the outset) that his hours would be variable. Alas, he felt the immediate brunt of the cost controls, but we've worked to feed him additional freelance work (at lower cost than we are paying other suppliers) to help him maintain some degree of income stability.

Openness is crucial. Our previous accounting and reporting system clearly didn't do the job, but we have maintained it because employees, in receiving the reports before and during the crisis, can see the numbers and that the problems (and solutions) are real. Through Open Book Management, employees also are receiving the new, much more detailed and forward-looking reports. This openness has helped us to maintain trust and respect and proven to the employees that superficial cost cutting measures are not enough.

I can't say all of the decisions we've had to make have been easy, and some of the toughest choices are imminent. But I'm now optimistic we'll pull through. You can, too, if you take charge and do what you need to do, while working openly and forthrightly with your employees to solve the problems.

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