HSBC: Crisis management is broken and there are no quick fixes

The five stages of a PR disaster

Credible and candid comments on the state of crisis management today by a man whose company went through its own crisis hell earlier this year.

Reporting on a panel discussion in a summary of last month’s PR Summit 2015 in The Holmes Report, Arun Sudhaman notes:

[…] From creativity to crisis management, via a heavyweight panel that featured communications leaders from HSBC, GM, Danish Crown and Qsoft. And it was HSBC’s Pierre Goad that caught the eye, when he candidly admitted to the bank’s failings in managing the damaging revelations about its Swiss operation earlier this year. “We don’t know how to manage a crisis in this new environment,” said Goad, adding that his nine-year-old son probably had a better grasp of social media than a big bank. “We’re stuck there trying to catch up,” Goad recalled.  “We did all the traditional things – it still didn’t quite work. We got absolutely beaten up for nine weeks and the aftershocks continue. I think it’s really hard for corporates to use social media proactively, outside of consumer brands.”

Goad’s comments should be not be ignored, as the HSBC communications chief knows more about crisis situations than most. They reveal how traditional crisis management techniques lag way behind contemporary consumer behaviour, and how difficult it is going to be for corporates to win trust in such a sceptical environment.

And Sudhaman quotes the US Department of Homeland Security’s Andy Ozment:

You have to be prepared for the fact that you might be forced to communicate before you have the facts, before you know whether 300 people are affected or 300,000.

It gives perspective to recent crises – Volkswagen and TalkTalk in particular spring to my mind.

Goad’s and Ozment’s comments are worth bringing to front of mind for the next business crisis to emerge before voicing criticisms on how the organization in the frame is managing it.

Add to all this remarks by Jason Fried, co-founder of 37signals, and quoted by Tom Fishburne in his 2012 post (from which the cartoon at top came):

People don’t judge you on the basis of your mistakes – they judge you on the manner in which you own up to them. In my experience, most companies do a terrible job of taking blame. They lob press releases. Or they apologize for the inconvenience. Resist that temptation and say you’re sorry like you’re apologizing to a friend. Be good – and your customers will be good right back to you.

The loathsome phrase “lessons to be learned” comes readily to mind.